Good for business? Why corporate lawyers give bad marks to Chicago, L.A.

Chicago and Los Angeles have the least fair and reasonable litigation environment for businesses in the US, according to a national survey released on Monday by the US Chamber of Commerce’s Institute for Legal Reform.

The survey asked 1,125 top lawyers at major corporations to rate state and county court systems.

They were asked: “Thinking about the entire country, what do you think are the five worst city or county courts? That is, which city or county courts have the least fair and reasonable litigation environment for both defendants and plaintiffs?”

Seventeen percent of respondents answered Chicago/Cook County, Illinois. Sixteen percent of surveyed lawyers identified Los Angeles.

In addition, nine percent listed the entire state of California and an additional nine percent identified San Francisco. Eight percent listed Philadelphia as having the least fair and reasonable court system.

The Institute for Legal Reform has been conducting the litigation survey since 2002. Institute officials say the results are important because a state’s lawsuit environment may influence where companies decide to locate or expand.

“As our economic recovery has stalled, a growing percentage of business leaders have identified a state’s lawsuit climate as a significant factor in determining their growth and expansion plans, and the jobs that come along with them,” Institute President Lisa Rickard said in a statement.

“That makes the consequences of this survey even more significant to the economic growth of individual states,” she said.

In the overall ranking of states, corporate lawyers identified the most fair litigation environments in Delaware, Nebraska, Wyoming, Minnesota, and Kansas.

Least fair from a corporate perspective were West Virginia, Louisiana, Mississippi, California, and Illinois, according to the survey results.

The corporate lawyers were asked to assess how the courts treat plaintiffs and defendants in tort cases, contract disputes, and class action lawsuits.

They were asked to give states a grade of A-F to assess performance in several areas. Those areas included treatment of tort and contract litigation, the conduct of class-action suits, whether courts restricted the location where suits could be filed or allow forum shopping, impartiality of judges and juries, and legal competence of judges.

The report notes that corporate lawyers gave state and local courts significantly more A’s and B’s than D’s and F’s. Respondents awarded A’s and B’s 49 percent of the time, and D’s and F’s 16 percent.

“Taken as a whole, general counsel and senior litigators perceive state courts to be doing better than average on the various elements,” the report says.

The full report is available here.