Although small businesses are touted as the economic engines driving job creation, they disproportionately bear the brunt of the nation’s tort costs, impairing their ability to thrive and grow, according to research released by the U.S. Chamber Institute for Legal Reform (ILR).

Businesses with $10 million or less in annual revenue paid $105.4 billion in tort liability costs in 2008, a study by ILR and NERA Economic Consulting points out. Some $35 billion of those costs were paid for out of pocket, not covered by insurance.

Unfortunately, for U.S. small businesses, their liability costs are expected to continue to grow. NERA forecasts that by 2011, small businesses, including small medical businesses, will be paying $152 billion in tort costs.

“Our lawsuit system is increasingly burdening business owners, workers, and our entire economy,” ILR President Lisa Rickard says. “As America struggles to get out of the economic downturn, this study shows that our lawsuit system continues to be a drag on job-creating small businesses.”

ILR and the Chamber are pushing back against trial lawyers at the state and federal levels through legislative, political, judicial, and educational activities. They opposed efforts by plaintiffs’ lawyers to receive a $1.6 billion tax break for costs associated with contingency fee lawsuits. They are fighting a slew of bills related to the Gulf Oil spill. One bill would allow certain class action lawsuits to be brought in state courts, where compensation awards are typically higher than in federal courts. Another would establish an unlimited liability cap for energy exploration activities.

Also, ILR and the Chamber applauded Florida and Georgia for passing laws that increase transparency and certainty in their legal systems.

To learn more, visit www.instituteforlegalreform.com.