Circuit Court Removal by Insurance Companies in Maryland Car Accident Cases

There is a battle now in the Maryland state legislature about whether Maryland should increase the minimum jurisdictional amount before a defendant can remove a case from District Court to Circuit Court. Defense lawyers for State Farm and Allstate, the two largest auto insurance providers in Maryland, routinely “bump up” District Court claims to Circuit Court if the amount in controversy is more than $10,000.

So what happens is we have an enormous volume of cases where insurance defense lawyers in Maryland are seeking jury trials in cases that do not belong in Circuit Court. Why? Do they think a jury will give them a more fair trial? Ironically, for the jury-hating insurance companies who continue to argue that juries are out of control, trust in juries is at least one reason insurance companies seek jury trials in Maryland auto accident cases (at least in some Maryland counties where juries are more conservative).

But the primary reason insurance companies seek jury trials in smaller auto accident cases in Maryland is because it tortures Maryland auto accident lawyers. The insurance companies do this, not motivated by spite—well not primarily anyway, but because it is a good global tactic. A significant number of auto accident lawyers in Maryland are reticent to sue. The threat of getting a small case going through the Circuit Court ringer is even more daunting to many Maryland injury lawyers. I’m not saying it should be. But it is for those seeking the path of least resistance.

Insurance defense lawyers are more than willing to spend the attorney time and resources to frustrate plaintiffs’ lawyers. The result is an artificial decrease in the settlement value of personal injury cases where the settlement value is between $10,000 and $30,000.

This has led to too many soft tissue auto accident cases resulting in jury trials. The median compensation for motor vehicle accident lawsuits in Maryland is slightly less than $12,000. This is a small amount of money to strain the judicial system with a jury trial. I would like to know what percentage of cases where the verdict is less than $20,000 went to Circuit Court because the insurance company sought a jury trial. I bet that a significant portion of those car accident verdicts were from plaintiffs’ accident lawyers filing in Circuit Court to avoid Baltimore City District Court—a topic for another day—and insurance companies bumping cases from District Court to Circuit Court. The Maryland state legislature should step in and make the right call and increase the jurisdictional amount required before insurance companies can remove Maryland auto accident cases to Circuit Court.

Howard Zimmerle says:

February 17, 2009 at 11:41 am

Here in Illinois where I practice, you get a 6 person jury for the cases below $10,000.
We have an arbitration system set up for cases between $10,000 and $50,000. The lawyer/arbitrators in this case routinely award more than juries eventually do in the same case (so I could definitely see the advantage to a bench trial). Even then, it’s rare to see an arbitration level case resolve for more than $20,000. I think one reason is that attorneys file the $20,000 or $30,000 case as a $50,000+ case just to be safe. They also file the (less than) $10,000 cases as arbitration level cases. You might be seeing a similar thing in Maryland.

Aldo Terrazas says:

March 11, 2010 at 6:59 pm

To disabuse the defense bar of the “bump up” practice, prevailing plaintiffs’ lawyers should routinely move for fees and cost at the close of their cases, arguing that the same were necessary due to the defense’s unnecessary removal. At the time the suit is served, the cover letter should put the defense attorney on notice of plaintiff’s intentions should defendant choose to bump up. If enough lawyers do it and judges (even just a few of them) award fees and costs, the defense bar will think twice before removing to circuit court.