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I have zero familiarity with practice in the USA, so someone else is probably better placed to comment. That being said, I suspect the absence of "loser-pays-c

I have zero familiarity with practice in the USA, so someone else is probably better placed to comment. That being said, I suspect the absence of "loser-pays-costs" does make things worse in the USA. This mitigates most of the potential downside to litigation, capping your exposure to a known (controllable) quantity. But even then, it's still a huge problem in Commonwealth countries. I'm more interested to know if it's less of an issue in civil law jurisdictions like Germany.

pc86 6y ago
The US is something like 65 separate legal jurisdictions - many of them do have "loser-pays-costs" for certain types of litigation, however this suit is likely in a federal court where no such law exists.
- vlovich123 6y ago
  The thing is that the company has litigation insurance. So actually the lawsuit will still be fought and the company will stay alive doing so. The problem is that they can’t raise another round to fund operations because they can’t find investors while the lawsuit is ongoing. As others have noted loser-pays doesn’t provide any protection. The problem is that lawyers write the rules for the system they operate in (either directly as legislators or indirectly through fundraising, influence, and lobbyists). Regardless of the outcome of a case the lawyers arguing it are fine. I wonder what would happen if you suddenly made the lawyers somehow financially vested in civil suits too and strengthen scenarios where lawyers become financially liable (ie bad faith arguments, shenanigans by lawyers that might be de facto legal but are judged to be bad faith, etc).