Judicial Hellholes: A Threat to Nevada’s Economy

The American Tort Reform Association has just issued its Judicial Hellholes 2007 report, an annual summary of the nation’s most unfair civil court jurisdictions. Disturbingly, among the places it lists is Clark County, home to two million people, the City of Las Vegas, and the vast majority of Nevada residents.

ATRA notes that “Clark County has joined the Judicial Hellholes list for the first time. The decks appear to be stacked in favor of local lawyers who reportedly “pay to play” in the county’s courts. Judges have been criticized for issuing favorable rulings in cases that benefit friends, campaign contributors or their own financial interests.”

The fact that Clark County made the list is very interesting, because judicial hellholes are usually places that are either parochial, poor, or economically stagnant places (like the Rio Grande Valley or West Virginia, which also made the list), or left-wing. That’s not true of Clark County. It’s hard to argue that Clark County is just getting the bad judiciary it deserves.

Nevada has a tradition of low taxes and low regulation, which has given it the fastest percentage growth in population and economic growth of any state, as well as a good business climate.

Now, however, that positive climate is under assault from the Nevada state courts. As I noted earlier, the Nevada Supreme Court, in an extraordinary act of judicial activism, nullified a state constitutional provision limiting tax increases that made it harder for the legislature to raise taxes to pay for an increase in education spending, treating it as a mere “procedural” technicality. Nevada voters removed Nancy Becker, one of the rotten justices responsible for that decision, and the Nevada Supreme Court itself has subsequently admitted that its decision in Guinn v. Legislature was based on bogus reasoning. But some of the bad judges responsible for that decision remain on the court, doing great mischief. They have come up with all sorts of bizarre excuses to justify lawsuits and abuse, in areas ranging from tort law and commercial law to family law and divorce law.

But the problem is much worse in Clark County than in most of the rest of Nevada. As the “Judicial Hellholes” report notes, the Los Angeles Times featured an in-depth report on the Clark County judiciary entitled “They’re Playing With A Stacked Judicial Deck,” which observed that Clark County “courts are clogged with frivolous litigation and the rolls of the state bar are spotted with unethical and incompetent attorneys.” Similarly, the Las Vegas Review-Journal noted that Clark County “courts are clogged with frivolous litigation and the rolls of the state bar are spotted with unethical and incompetent attorneys.”

The “Judicial Hellholes” report cites example after example of corruption in Clark County:

“In Las Vegas courts, the deck is stacked for certain local lawyers. Judges routinely approve fees or rule on cases that benefit friends, business associates and campaign contributors without reporting the potential conflict. According to the L.A. Times‘ investigative report, Clark County judge had a fundraiser hosted by lawyers with cases before him just four days before a crucial hearing. The personal injury lawyer who brought that case, along with others in his firm, were the largest contributors to the event. The corporate defense lawyer, on the other hand, ‘hadn’t chipped in a dime.’ After the judge declined the defense motion to withdraw from the case, the defendant was ordered by the judge to pay $1.5 million in damages to the plaintiffs. Another judge held a fundraiser where 51 of the 54 attorneys donating $500 or more had cases pending before her or were assigned to her courtroom, while a former state judge ‘approved more than $4.8 million in judgments and fees during more than a dozen cases in which a recent search of court records found no statement that he disclosed his relationship with those who benefited from his decisions.’ One judge adjudicated six cases involving an attorney from whom he had ‘borrowed’ money. A senior judge ‘presided over at least 16 cases involving participants in his real estate deals,’ and another senior judge ‘ruled for a casino corporation in which he held stock.'”

Complicity in the corruption also appears to extend to court personnel responsible for making sure that cases are “randomly” assigned. For example, “former Las Vegas Tribune columnist Steve Miller asked the question, ‘How often is a judge ‘randomly’ assigned to five simultaneous, unrelated civil trials that include the same litigation?’ His answer? ‘Never — until recently.’ It seems that a certain local judge kept coming up whenever ‘one of the four biggest contributors to [her] last political campaign’ was involved in several civil lawsuits at the same time.”

The malfeasance in Clark County does not simply affect businesses. It also affects the little people. When I was a lawyer working for a non-profit law firm in Washington, D.C., before moving to CEI, I received letter after letter from people complaining about abuses in how Clark County judges handle divorce and child custody cases. I encountered disgraceful Clark County rulings such as one that gave custody of a child to an indisputably physically abusive and neglectful parent, and one that ordered a noncustodial parent dying of incurable liver disease to spend scarce funds paying for a spoiled adult child’s graduate school education. I could do nothing for the victims of these rulings, since my employer did not handle family law cases, or cases in state court.