The Litigation Economy

The Price of Making the Problem Go Away

The Mafia understood one economic principle extraordinarily well: protection has value when the alternative costs more.

The old protection racket was criminal. Civil litigation is not the Mafia. Filing a lawsuit is not violence, a settlement demand is not automatically extortion, and lawyers representing genuinely injured people perform a legitimate and necessary function.

But strip away the criminal comparison and examine the economics. A defendant receives a $250,000 demand and believes the underlying claim is weak. Perhaps liability is uncertain. Perhaps causation is questionable. Perhaps damages appear inflated. The defendant now confronts two prices: the price of the claim, and the price of proving the claim wrong.

If defending the case through discovery, experts, depositions, motions and trial could cost $100,000, while the claimant will accept $50,000, payment may be economically rational even when the defendant believes it owes nothing.

That $50,000 may not measure the injury. Part of it may simply purchase an exit from the litigation process. When the cost of determining the truth exceeds the cost of surrender, the process itself creates negotiating leverage.

The Small-Defendant Paradox

Now make the defendant smaller. Replace the multinational corporation with a restaurant owner, contractor, landlord, physician, local manufacturer, independent professional or homeowner.

A large corporation may have insurance specialists, established counsel, litigation reserves and the financial endurance to reject an unattractive settlement. A family business or individual may not. For a large enterprise, another $25,000 of legal expense can be manageable. For a modest defendant, it can consume savings, interrupt payroll or threaten survival.

Consider a small defendant facing a $100,000 demand. The defendant believes the claim is unfounded, but depositions, experts and counsel through trial might cost $40,000 or $50,000. Now the claimant offers to settle for $15,000.

The less able a defendant is to afford proving that he is right, the less the ultimate merits may matter to the settlement decision. The wealthy can afford principle. The small defendant often cannot.

A poor plaintiff deserves meaningful access to justice against a powerful defendant. A modest defendant deserves meaningful access to the same justice against a professionally financed plaintiff. Anything less turns equality before the law into a question of who can afford to stay in the room.

Insurance Does Not Make the Cost Disappear

Insurance can make settlement appear painless. The insurer writes the check, the claim closes, and everyone moves on. But the cost has not disappeared. It has moved into the insurance system.

An insurer may rationally prefer a $15,000 settlement to spending $50,000 defending a claim. That can be prudent risk management. Yet the insured may care about something the spreadsheet does not price: vindication.

Across a risk pool, claims, settlements and defense expenses are part of the economics insurers must finance. Not every settlement causes an individual premium increase, and premiums are affected by many factors. But insurance fundamentally pools and prices losses rather than erasing them.

The defendant may be removed from the immediate transaction, but the cost survives. It is distributed. The lawyer can rationally pursue the claim, the insurer can rationally settle it, and the defense lawyer can rationally bill for defending it. Everyone can act rationally while collectively financing a system that becomes progressively more expensive to resist.

The Institution That Wants the File Closed

The litigation economy is not powered by lawyers alone. Institutions often value resolution for reasons that differ from the accused person's desire for adjudication.

The EEOC provides a useful example of that distinction. Its mediation program is voluntary and uses a neutral mediator who does not decide who is right or wrong. If mediation fails, the charge proceeds to investigation. Mediation is therefore a mechanism for negotiated resolution, not a determination of guilt or innocence. [6]

That is legitimate administrative design. But it illustrates the central tension: institutional efficiency and factual vindication are not the same objective. A dispute can be resolved without producing a public determination of who was right.

The missing constituency can therefore be the person who wants more than closure. The claimant wants a remedy. Counsel wants an effective result. The insurer wants controlled exposure. The institution wants an efficient disposition. Who assigns economic value to proving that the accusation was wrong? Sometimes nobody.

Scale Is Not Just for Corporations

A litigation enterprise does not need one $100 million recovery to produce substantial revenue. Volume works too.

There is nothing inherently improper about efficiency. Technology and scale can lower the cost of representation and make legitimate claims possible. The concern arises when the cost of processing claims falls while each defendant's cost of resisting a claim remains high.

Then the economic value of a claim can contain two components: value supported by liability and actual damages, plus value created by the defendant's cost of resistance.

A justice system should not manufacture the value of a claim merely by making that claim expensive to defeat.

SATIRICAL COMPOSITE — The law firm described in the following section is fictional. Its details are illustrative, not factual claims about any identifiable firm. The wider editorial discusses real legal and economic institutions.

The Country’s Largest Personal-Injury Law Firm: A Satire of Scale

When the Mercenary Owns the Operation

Imagine a fictional national personal-injury firm so large that its billboards appear to have their own zoning department. It has a slogan for every highway exit, a call center that never sleeps, and a marketing budget that could make a minor kingdom reconsider its priorities. This is satire: the firm is a composite, not a description of any particular law practice.

In our imaginary enterprise, each claim arrives as a story of injury and becomes, after careful review, a file, a forecast, a calendar, a cost center and perhaps a settlement. Technology helps the firm organize evidence and represent clients efficiently. It also gives the business an incentive to measure throughput, predict recoveries and calculate the cost of fighting. The computer has not replaced justice; it has simply acquired a dashboard.

The fictional firm works on contingency: clients ordinarily do not pay an attorney fee up front, and the lawyer receives an agreed share of a recovery. In real life, that arrangement can be indispensable. It gives injured people access to counsel when they could not afford an hourly rate. Our satire is not about whether injured people deserve representation. They do.

That defense of the model matters. Contingency representation can give an injured person who lacks capital the ability to confront an insurer or corporation with vastly greater resources. That is a legitimate public function. The harder question begins when the equalizer itself becomes an industrial enterprise.

Brand → Claims → Scale → Capital → Litigation Capacity → Leverage → Recoveries → More Capital → More Brand

At that point, the opposing party confronts more than the merits of a single file. The economic question becomes inseparable from the legal one: not merely “Are we right?” but “What will it cost to prove we are right?” A party can possess a defensible position and still conclude that settlement is cheaper than discovery, experts, depositions, motions, uncertainty and trial. That does not establish that either side was legally correct. It establishes that litigation itself has a price.

The satirical target is the incentive structure, not the conduct of an identifiable firm. When an institution becomes very good at financing litigation, a defendant may ask not only whether a claim is valid but also how much it will cost to test that question. A settlement can be economically rational without proving that either party was right. That is a question about the design of civil justice, not an accusation of extortion.

The mercenary metaphor identifies the structural tension. A lawyer is an advocate. A contingency lawyer is also an economic participant because compensation depends on recovery. When advocacy is embedded in a national commercial engine, the warrior is no longer simply hired for the battle; the mercenary owns part of the operation that is paid when the battle produces a recovery.

The most formidable litigation machine therefore does not have to win every case. It needs the institutional capacity to credibly keep fighting. Once that capacity is understood, the settlement calculation can move from “Who is legally right?” toward “What price makes this dispute disappear?” The law remains present, but economics can determine whether the law ever receives a final adjudication.

The question is not whether scale is legal. The question is whether the machinery built to equalize power can accumulate enough power that the cost of resisting the machinery begins to compete with the merits of the claim itself.

Who Regulates the Regulators?

1.37 Million Lawyers, State-by-State Regulation, and the Question Nobody Owns

There is another institution conspicuously present in the litigation economy: the legal profession’s own disciplinary machinery. Lawyers are regulated. Ethical rules exist. Disciplinary authorities investigate misconduct, and courts can impose sanctions. None of that should be minimized. But the architecture deserves scrutiny. [7][8]

Consider South Carolina. The South Carolina Judicial Branch states that the Supreme Court has jurisdiction over the administration of state courts, admission to practice law, and discipline of South Carolina lawyers and judges for ethical violations. The Court also established the Commission on Lawyer Conduct to preside over complaints of lawyer misconduct and make recommendations to the Supreme Court. [8][9]

The Commission has 50 members: 34 attorneys and 16 members of the general public. That does not establish corruption. It establishes a legitimate question about institutional design: lawyers constitute a majority of a commission operating inside the profession’s disciplinary structure. [9]

The latest ABA Profile of the Legal Profession reports 1.37 million lawyers in the United States in 2025, up from 1.35 million in 2024. The ABA says its National Lawyer Population Survey counts resident active lawyers using data collected from state licensing bodies. [7]

The question is not whether 1.37 million lawyers are conspiring to manufacture litigation. There is no basis for making such a claim. The more troubling question is structural: who inside the litigation economy has an economic incentive to make the litigation economy smaller?

Plaintiff lawyers earn money pursuing claims. Defense lawyers earn money defending claims. Complex disputes generate work for experts, consultants and litigation-support services. These ordinary economic relationships do not prove misconduct. They do, however, justify asking whether professional discipline and economic oversight are solving the same problem.

Every participant may behave honorably. Every lawyer may comply with the professional rules. The system can nevertheless possess incentives that perpetuate complexity and legal spending. That is the distinction between individual misconduct and structural conflict of interest.

The National Picture

South Carolina is important not because it proves the system is uniquely compromised, but because it provides a window into the larger American regulatory architecture. The American Bar Association states explicitly that it is not a lawyer disciplinary agency and has no authority to investigate or act upon complaints against lawyers. Each state has its own agency performing that function for lawyers practicing in that state. [11]

There is national coordination, but not a single national disciplinary regulator. The ABA operates the National Lawyer Regulatory Data Bank, which it describes as the only national repository of information concerning public regulatory actions relating to lawyers throughout the United States. The ABA says all states and the District of Columbia, many federal courts, and some agencies provide regulatory information to the Data Bank. [12]

The distinction matters: a national repository of sanctions is not the same thing as a national regulator. The ABA describes the Data Bank as a central repository that assists disciplinary authorities and bar-admission agencies, while public disciplinary authority remains jurisdictional. [11][12]

National coordination therefore does not erase the South Carolina question. It nationalizes it.

The disciplinary architecture is built to identify and respond to professional misconduct. The litigation-economy question is different: who has independent responsibility for examining whether the economic structure of litigation itself creates incentives that make conflict, complexity and the cost of resistance economically valuable? The cited national regulatory sources describe disciplinary functions and repositories; they do not identify a single national body assigned that broader economic mandate. [11][12][13]

That is not an accusation that disciplinary authorities are failing to perform their assigned work. The ABA itself offers discipline-system consultations, when invited by the appropriate oversight agency, to review lawyer or judicial discipline systems and provide recommendations. That is evidence of oversight and professional-regulation infrastructure. It still leaves the institutional distinction between policing misconduct and examining the economics of litigation. [13]

Everyone can perform the assigned function correctly while nobody owns the larger question. That is not an accusation of conspiracy. It is an accusation of architecture.

An Ethical System Can Still Have Bad Economics

Traditional lawyer discipline asks whether a lawyer violated professional obligations. South Carolina’s published disciplinary system expressly focuses on ethical violations and lawyer misconduct. Its 2025–2026 annual report records 4,160 complaints pending or received during the fiscal year, 2,609 complaints resolved, 25 definite suspensions and 10 disbarments. Those figures show an operating disciplinary system; they do not answer whether the litigation system itself creates excessive or distorted economic incentives. [8][10]

That distinction is the heart of the issue. What if the participants follow the rules and the rules still produce economically perverse incentives? Who investigates whether litigation has become unnecessarily expensive? Who assesses whether procedural complexity generates costs disproportionate to the underlying dispute? Who represents the insured defendant’s interest in vindication when an insurer rationally prefers settlement? And who asks what portion of the money circulating through the litigation economy reaches people who suffered demonstrated harm?

Who inside a system economically sustained by legal activity is institutionally responsible for asking whether society needs less legal activity?

That is not principally a disciplinary question. It is a governance question.

Self-Regulation Is Not Independence

The serious criticism therefore cannot be that there is no oversight. There plainly is. In South Carolina, the Supreme Court has disciplinary authority, and the Commission on Lawyer Conduct includes both lawyers and public members. [8][9]

The harder question is whether oversight designed to police individual misconduct is also capable of examining the economic incentives generated by the litigation industry itself. One inquiry asks whether the players obeyed the rules. The other asks whether the rules created the right game.

The Mafia Boss Was Outside the System

The Mafia boss stood outside the justice system. The lawyer stands inside it.

That does not make lawyers mobsters. It means precisely the opposite: lawyers are licensed participants in a legitimate system of justice and can invoke the machinery of courts on behalf of clients. That legitimacy is why the system deserves a higher standard of scrutiny, not a lower one.

Discovery, depositions, expert testimony, motions, hearings and trials are essential mechanisms for finding facts and resolving disputes. But legitimacy does not erase economics. If defending a claim costs $50,000 while settling it costs $15,000, the process itself has acquired monetary value.

That is where the Mafia analogy must end and the public-policy inquiry must begin: when the legal cost of resisting a demand exceeds the price of surrender, how do we distinguish compensation for a legitimate injury from money paid because resistance is unaffordable?

“Unreasonable” Is Not a Number

Attorney fees illustrate another feature of the system. South Carolina's Rule of Professional Conduct 1.5 does not impose a general numerical hourly ceiling. It prohibits an unreasonable fee and identifies factors such as time and labor, difficulty, customary local fees, results, experience and whether the fee is fixed or contingent. [3]

That is meaningful regulation, but regulation through a standard rather than a published price ceiling. One of the listed factors is the fee customarily charged in the locality for similar services.

The economic concern is straightforward. As legal representation becomes more expensive, the cost of reaching adjudication can rise with it. A justice system can promise everyone a day in court while simultaneously pricing that day beyond practical reach.

A right that costs more to exercise than surrender is a peculiar kind of right.

When Government Becomes a Participant

Then government enters the picture. The tobacco litigation provides a striking historical example of public enforcement, private litigation, public policy and substantial financial payments converging.

The National Association of Attorneys General says the 1998 Master Settlement Agreement settled dozens of state lawsuits seeking recovery of health-care costs associated with smoking-related illness. The agreement imposed continuing payment obligations and restrictions on tobacco marketing. California's attorney general describes the agreement as requiring an estimated $206 billion in payments to the states, and NAAG continues to publish information on annual payments. [4][5]

Yet cigarettes remained legal products. That is not necessarily contradictory. A free society can regulate dangerous activity rather than prohibit it. Adults retain autonomy, and prohibition creates costs of its own.

But the incentive question is legitimate: when government receives continuing money from an activity it simultaneously regulates as harmful, citizens are entitled to scrutinize the institutional incentives created by that arrangement.

The question is broader than tobacco. Who should determine acceptable societal risk: elected lawmakers, specialized regulators, courts, juries, or settlement negotiations conducted under the economic pressure of litigation?

The Settlement Is Not the Injury

A $250 million demand does not mean someone suffered $250 million in provable loss. A $250 million verdict does not necessarily mean the claimant ultimately receives $250 million. And a $250 million settlement does not necessarily mean the defendant admitted liability.

Those distinctions disappear quickly in public debate. The size of the number begins to stand in for proof of wrongdoing.

But financial outcomes in litigation can reflect economic damages, noneconomic damages, punitive elements, fees, expenses, uncertainty and the future cost of continuing the dispute. The public deserves to know the difference.

Justice should compensate actual injury generously when wrongdoing caused it. The size of the transfer cannot itself become proof that the transfer was justified.

The Circular Litigation Economy

Follow the money far enough and a broader structure becomes visible. Businesses and citizens buy insurance. Insurers price risk into premiums. Businesses incorporate insurance and liability costs into operating expenses. Claims create plaintiff-side legal work and defense-side legal work. Complex cases support experts, consultants, discovery services and other professional services. Settlements can compensate injured people while also financing the machinery needed to produce and defend those settlements.

The costs do not vanish. They circulate.

That observation does not prove misconduct. It establishes something more important: justice has transaction costs, and a country spending hundreds of billions of dollars within its tort system should care deeply about the proportion consumed by process versus the proportion reaching people who suffered demonstrated harm.

The Necessary Counterargument

A serious editorial must confront the strongest case for the existing system. Corporations sometimes behave badly. Dangerous products exist. Companies conceal information. Drivers act negligently. Professionals make catastrophic mistakes. Governments fail. People get hurt.

An ordinary person confronting a wealthy institution may have no realistic remedy without a lawyer prepared to take the case without substantial payment up front. Contingency representation can therefore operate as an economic equalizer rather than a predatory mechanism.

That institution deserves protection. So does aggressive advocacy when the underlying claim is legitimate.

The objective of reform cannot be to make litigation so dangerous that genuinely injured families are frightened away from court. The system must protect two propositions simultaneously: no defendant should escape responsibility merely because the plaintiff cannot afford justice; no plaintiff should obtain money merely because the defendant cannot afford justice.

That is symmetry. That is equality before the law.

A healthy economy rewards the creation of economic value. A healthy justice system should reward the fair and efficient resolution of legal conflict. When the institutions surrounding justice prosper from the existence, duration and complexity of conflict, society must ask whether the economic incentives of the litigation market remain aligned with the purpose of the law.

The danger is not competition itself. Competition can improve advocacy and give clients meaningful choices. The danger arises when economic survival depends upon capturing enough legal activity to remain viable. The market then has incentives not merely to allocate existing legal work, but to identify, finance, expand and monetize it. That conclusion is an argument about institutional incentives, not an accusation that individual lawyers manufacture disputes or violate ethical rules.

Economic analysis has long recognized that private incentives to litigate may diverge from what is socially desirable. Steven Shavell’s National Bureau of Economic Research analysis addresses suit initiation, settlement versus trial, trial expenditures, negative-value suits, fee shifting, lawyer-client fee arrangements and insurers, with the divergence between private incentives and social desirability as a central theme. [17]

The law should make weak claims inexpensive to test and defeat. The litigation market can make the process of testing them expensive.

The law should resolve disputes efficiently. The litigation market can generate revenue while disputes remain unresolved.

The law should reward clarity. The litigation market can reward complexity.

For the economy surrounding litigation, more legal activity can be revenue-producing activity. More disputes can mean more paid work. More claims can create more contingency opportunities. More discovery can create more demand for lawyers, experts and litigation-support services. More complexity can increase the amount of specialized legal work required. But what benefits the litigation market does not necessarily benefit the law.

That limitation should remain explicit. The argument does not need an invented number. The documented turnover is enough to expose the market pressure, while the absence of a national financial-exit count identifies another gap in what the profession measures.

The longer view is equally sobering but still does not establish why every lawyer left practice. The American Bar Foundation’s After the JD project follows more than 5,000 lawyers admitted to the bar in 2000. Preliminary third-wave findings reported that 24 percent of surveyed lawyers were not practicing law in 2012, compared with about 9 percent in 2003. Nonpracticing careers included law professors, real-estate agents and investment bankers. The evidence therefore documents movement out of active practice, but it does not provide a defensible national count of lawyers who left specifically because they could not make the economics work. [15][16]

The available evidence requires precision. The NALP Foundation’s 2025 study of 141 participating U.S. and Canadian firms reported 4,442 associate departures and an average associate attrition rate of 19 percent. Eighty-three percent of departing associates had left within five years of hire. These figures measure departures from participating firms, not exits from the profession and not financial failure. [14]

A brutally competitive legal market is often defended the way competitive markets are defended everywhere else: competition should produce efficiency, innovation, lower prices and better service. But law is not an ordinary market. Justice is not merely a product, and litigation volume is not evidence that the system is producing more justice.

When Competition Serves the Market, Not the Law

Who Should Reform the Litigation Economy?

The answer cannot be the American Bar Association alone, and it cannot be politicians alone. If the problem is structural incentives rather than simply lawyer misconduct, reform must involve institutions with deliberately different responsibilities and interests.

State Supreme Courts: Regulate the Profession

The existing jurisdictional architecture puts each jurisdiction’s highest court at the center of lawyer regulation. In March 2026, the Conference of Chief Justices reaffirmed that each jurisdiction’s highest court regulates the professional conduct of attorneys authorized to practice there by adopting ethical standards and disciplinary mechanisms. [18]

That makes state supreme courts natural leaders on professional regulation, admissions, discipline and regulatory design. Existing national court leadership has already embraced reform as an ongoing responsibility: a 2025 Conference of Chief Justices and Conference of State Court Administrators resolution established a standing Committee on Legal Education and Admissions Reform to facilitate implementation of recommendations and investigate additional reforms. [19]

The ABA: Architect, Researcher, Convener — Not the National Policeman

The American Bar Association should have an important role, but not exclusive custody of reform. The ABA explicitly states that it is not a lawyer disciplinary agency and has no authority to investigate or act on complaints against lawyers; each state has its own agency for lawyers practicing there. The ABA does, however, operate the National Lawyer Regulatory Data Bank and collects national lawyer-discipline statistics. [11][12][20]

The ABA therefore belongs at the reform table as a source of model rules, research, professional expertise and national data. Its own Model Rules for Lawyer Disciplinary Enforcement contemplate a permanent statewide disciplinary agency appointed by the court and include both practicing lawyers and public members. [21]

Legislatures: Examine the Public-Policy Economics

Politicians should not become professional disciplinary tribunals. But elected legislatures have a legitimate public-policy role wherever statutes shape the economic environment in which civil litigation operates. The precise division of authority varies by jurisdiction and is constrained by constitutional and judicial authority. The reform principle should therefore be institutional rather than partisan: courts police professional conduct and procedure within their authority; legislatures examine public policy within theirs.

Courts and Rulemakers: Make the Merits Cheaper to Reach

If the cost of resistance can itself create settlement leverage, then procedural efficiency is not administrative housekeeping. It is substantive economic reform. The objective should not be to make plaintiffs weaker or defendants stronger. It should be to make the merits cheaper to discover.

Existing court leadership has already recognized that legal regulation should be evaluated against access, affordability, quality and market effects. The Conference of Chief Justices has endorsed assessment metrics for regulatory reforms that examine access to justice, the legal-services market and the effectiveness of the regulatory system. [22]

Independent Public-Interest Scrutiny: Measure the Machine

Professional discipline answers whether lawyers violated professional obligations. It does not, by itself, answer whether the economic architecture surrounding litigation produces socially desirable outcomes. Reform therefore needs an independent public-interest component capable of examining system performance rather than individual ethics alone.

That body, commission or research function should ask the questions that otherwise risk belonging to nobody: How much does litigation cost? Where does the money go? What proportion reaches demonstrably injured claimants? What proportion is consumed by legal process? Which procedural rules generate measurable cost without proportionate gains in adjudication? How often does the cost of defense materially influence settlement? These are proposed reform questions, not statistics claimed by this editorial.

No Participant Should Own Reform

The reform answer is therefore not to transfer ownership of the machinery from lawyers to politicians. Nor is it to ask the profession to examine itself in isolation. Court systems themselves recognize the need for collaboration: the Conference of Chief Justices’ National Action Plan described meaningful change in professionalism as requiring sustained, coordinated effort among different components of the legal community. [23]

Nobody with a financial or institutional stake in the litigation economy should have exclusive authority to reform it.

Courts understand adjudication. Lawyers understand practice. Legislatures represent the public in making public policy. Researchers can measure incentives and outcomes. Litigants and consumers experience the consequences. Reform should require all of them while giving none of them exclusive custody of the question.

Because the objective is not fewer lawyers, fewer plaintiffs, fewer defendants or fewer lawsuits.

The objective is simpler and more demanding: reduce the economic value of unnecessary conflict while preserving the legal value of justice.

The Questions Reformers Should Be Asking

Arguments about tort reform too often collapse into predictable camps. Trial lawyers defend access to courts. Business interests argue for protection against excessive litigation. The better question is neither pro-plaintiff nor pro-defendant: how do we maximize compensation for proven injury while minimizing the economic value of weak claims?

That means confronting incentives. When should legal costs shift? How quickly can unsupported claims be tested? How transparent should settlement distributions and attorney fees become? How should ordinary individuals and small businesses obtain affordable counsel when they are defendants? How should courts distinguish genuine legal uncertainty from settlement value created principally by the expense of continued resistance?

And above all: what portion of every dollar entering the tort system reaches the injured person the system claims to serve?

When Settlement Becomes Cheaper Than Truth

America unquestionably needs civil litigation. It needs lawyers willing to represent powerless people, courts capable of holding powerful institutions accountable, and serious damages when serious wrongdoing causes serious harm.

But a justice system must be capable of examining the industry that grows around those principles without treating scrutiny as an attack on justice itself.

The test cannot merely be whether somebody can file a lawsuit. It must be whether the system can reliably determine who was wrong, who was harmed, who caused that harm, and what proportionate remedy follows.

If processing claims becomes cheap while defending them remains expensive, incentives matter. If the rational response to an unsupported demand is payment rather than adjudication, incentives matter. If an insurer can make a financially rational settlement while the insured loses any realistic path to vindication, incentives matter.

The danger is not that lawyers make money. Skilled advocates should be paid for valuable work. The danger begins when the dispute becomes the product, the process becomes leverage, and the cost of resistance begins determining the outcome more powerfully than the merits.

A justice system worthy of the name must make wrongdoing expensive. But it must also make truth economically reachable. The injured must be able to afford to pursue the wrongdoer, and the accused must be able to afford to prove the accusation wrong.

That requires something more demanding than professional ethics. It requires institutional independence capable of questioning the interests of the profession itself.

A system cannot answer every criticism merely by pointing out that its participants followed the rules. Compliance matters. Discipline matters. But neither answers the larger economic question. Who benefits from complexity? Who profits from conflict? Who pays for resolution? And who, with no economic stake in perpetuating the litigation machine, is empowered to ask whether the machine has become larger than justice requires?

The danger is not merely that a national plaintiff firm becomes powerful. It is not merely that insurers find settlement cheaper than adjudication. And it is not that lawyers are paid well for difficult work. The danger is a closed economic circle in which litigation creates work, work creates revenue, revenue builds litigation capacity, litigation capacity increases leverage, and the institutions charged with policing professional misconduct may not be designed to police the economics of the system itself.

None of that proves corruption. It raises the more unsettling possibility that corruption is not necessary. A system can become self-perpetuating without anybody conspiring to perpetuate it. Every participant can follow the rules. Every transaction can appear rational. Every settlement can make economic sense.

A competitive market can be economically productive while remaining institutionally misaligned with the law it serves. And the collective result can still be a justice system in which the price of resistance competes with the merits, the industry surrounding justice prospers from conflict, and the public is left asking the question that should have been asked at the beginning:

Who is watching the people who own the machinery of justice?

Sources and notes

[1] The Brattle Group, Tort Costs in America, Fourth Edition, published by the U.S. Chamber Institute for Legal Reform, November 3, 2026. Estimates more than $655.6 billion in 2025 tort costs and compensation (2.12% of GDP; over $4,900 per household). Study commissioned/published by a civil-justice reform advocacy organization; figures are modeled estimates. https://www.uschamber.com/lawsuits/tort-costs-in-america. Earlier 2024 edition estimated more than $529 billion for 2022.

[2] U.S. Chamber Institute for Legal Reform, Tort Costs in America, Third Edition, Nov. 2024. The study was conducted by The Brattle Group and published by an organization that advocates legal reform; that perspective is identified in the editorial.

[3] South Carolina Judicial Branch, Rule 407, Rule 1.5: Fees. Prohibits unreasonable fees and lists factors including customary local fees, amount involved, results, experience, and whether a fee is fixed or contingent.

[4] National Association of Attorneys General, The Tobacco Master Settlement Agreement. Describes the 1998 settlement, payment obligations, public-health restrictions, and annual payments to settling states.

[5] California Department of Justice, Master Settlement Agreement. Describes estimated $206 billion in payments to states and major marketing restrictions.

[6] U.S. Equal Employment Opportunity Commission, Mediation. Describes EEOC mediation as voluntary; the mediator does not decide who is right or wrong, and unsuccessful mediation returns the charge to investigation.

[7] American Bar Association, 2025 Profile of the Legal Profession / National Lawyer Population Survey. Reports 1.37 million U.S. lawyers in 2025, up from 1.35 million in 2024, and explains that the survey gathers lawyer counts from state licensing bodies. https://www.americanbar.org/news/profile-legal-profession/

[8] South Carolina Judicial Branch, “Lawyer & Judicial Discipline.” States that the Supreme Court of South Carolina has jurisdiction over administration of state courts, admission to practice, and authority to discipline South Carolina lawyers and judges for ethical violations. https://www.sccourts.org/about/lawyer-judicial-discipline/

[9] South Carolina Judicial Branch, “Commission on Lawyer Conduct.” States that the Supreme Court established the Commission under Rule 413 to preside over lawyer-misconduct complaints and make recommendations to the Supreme Court; Commission membership is 34 attorneys and 16 members of the general public. https://www.sccourts.org/about/lawyer-judicial-discipline/commission-on-lawyer-conduct/

[10] South Carolina Judicial Branch, Annual Report of Lawyer Discipline in South Carolina 2025–2026. Reports 4,160 complaints pending and received, 2,609 resolved, 25 definite suspensions, and 10 disbarments for the fiscal year. https://www.sccourts.org/media/haddez1g/clc2026.pdf

[11] American Bar Association, “Resources for the Public: Complaints Against Lawyers.” States that the ABA is not a lawyer disciplinary agency, has no authority to investigate or act on lawyer complaints, and that each state has its own agency performing that function. https://www.americanbar.org/groups/professional_responsibility/resources/resources_for_the_public/

[12] American Bar Association, “National Lawyer Regulatory Data Bank.” Describes the Data Bank as the only national repository of public regulatory actions concerning lawyers; states that all states and the District of Columbia, as well as many federal courts and some agencies, provide regulatory information. https://www.americanbar.org/groups/professional_responsibility/services/databank/

[13] American Bar Association, Center for Professional Responsibility, “Services.” Describes lawyer and judicial discipline-system consultations conducted on invitation from the appropriate oversight agency, with reports and recommendations provided to the highest court or other inviting agency. https://www.americanbar.org/groups/professional_responsibility/services/

[14] NALP Foundation, “The NALP Foundation Releases Latest Update on Associate Attrition and Hiring (CY 25),” Apr. 21, 2026. Reports 2025 data from 141 participating U.S. and Canadian firms, including 4,442 associate departures, a 19% average associate attrition rate, and 83% of departing associates leaving within five years of hire. https://www.nalpfoundation.org/news/the-nalp-foundation-releases-latest-update-on-associate-attrition-and-hiring-%28cy-25%29

[15] American Bar Foundation, “After the JD: A National Study of Lawyer Careers.” Describes the project as a longitudinal national study tracking more than 5,000 lawyers during their first twenty years after passing the bar. https://www.americanbarfoundation.org/projects/after-the-jd-a-national-study-of-lawyer-careers/

[16] ABA Journal, “After the JD study shows many leave law practice,” Apr. 1, 2014. Reports preliminary findings that 24% of surveyed lawyers admitted in 2000 were not practicing in 2012, compared with about 9% in 2003, and identifies examples of nonpracticing careers. https://www.abajournal.com/magazine/article/after_the_jd_study_shows_many_leave_law_practice

[17] Steven Shavell, “Economic Analysis of Litigation and the Legal Process,” National Bureau of Economic Research Working Paper 9697, May 2003. Analyzes suit initiation, settlement, trial expenditures, negative-value suits, fee shifting, lawyer-client fee arrangements and insurers; identifies divergence between private incentives to litigate and socially desirable outcomes as a major theme. https://www.nber.org/papers/w9697

[18] Conference of Chief Justices, Resolution 1-2026, “Reaffirming the Authority of Jurisdictions’ Highest Courts to Regulate the Professional Conduct of All Attorneys Authorized to Practice in their Jurisdictions,” Mar. 20, 2026. Reaffirms that each jurisdiction’s highest court regulates attorney professional conduct through ethical standards and disciplinary mechanisms. https://ccj.ncsc.org/resources-courts/reaffirming-authority-jurisdictions-highest-courts-regulate-professional-conduct

[19] Conference of Chief Justices and Conference of State Court Administrators, Resolution 2-2025, “In Support of Establishing a Standing Committee on Legal Education and Admissions Reform.” Accepts the CLEAR report, establishes a standing committee to facilitate implementation and investigate additional reforms, and states that long-term collaboration among critical stakeholders is required to address structural impediments. https://ccj.ncsc.org/sites/default/files/media/document/Resolution%202_CLEAR_7_25_F_0.pdf

[20] American Bar Association, “Survey on Lawyer Discipline Systems 2023.” States that the ABA Center for Professional Responsibility collects, analyzes and compiles national statistics about lawyer regulatory systems; the 2023 questionnaire was sent to 56 lawyer disciplinary agencies. https://www.americanbar.org/groups/professional_responsibility/resources/surveyonlawyerdisciplinesystems/

[21] American Bar Association, Model Rules for Lawyer Disciplinary Enforcement, Rule 2. Describes a permanent statewide lawyer-discipline agency appointed by the court, with practicing lawyers and public members and separation of prosecutorial and adjudicative functions insofar as practicable. https://www.americanbar.org/groups/professional_responsibility/resources/lawyer_ethics_regulation/model_rules_for_lawyer_disciplinary_enforcement/rule_2/

[22] Conference of Chief Justices, Resolution 2, “Endorsing Standards for Regulatory Reform Assessment Metrics.” Endorses metrics assessing regulatory innovations for their effects on access to justice, the legal-services market and regulatory-system effectiveness. https://ccj.ncsc.org/resources-courts/endorsing-standards-regulatory-reform-assessment-metrics

[23] Conference of Chief Justices, “A National Action Plan on Lawyer Conduct and Professionalism,” adopted Jan. 21, 1999. States that different components of the legal community influence professionalism in different ways and that meaningful change requires sustained commitment and coordinated effort. https://ccj.ncsc.org/resources-courts/national-action-plan