The 2025 Tort Reform Act: Georgia Charts a New Course Toward Fairer Trials
By the partnership of McMickle, Kurey & Branch, LLP
Please note: as of this writing, Senate Bill 68 continues to await Governor Kemp’s signature and has not yet taken effect. Our understanding is that Governor Kemp is awaiting passage of the other component of the tort reform bill, Senate Bill 69, in order to sign the complete package into law on the same date. This is prudent, as it will align the effective dates from both bills and eliminate confusion in the future.
Georgia’s new tort reform package represents the most comprehensive overhaul of Georgia civil procedure since 2005. MKB has been intimately involved in advocacy for this bill, including developing the background information that led to parts of this legislative effort. MKB’s firm-wide discovery efforts across a range of cases, involving more than a dozen MKB partners and associates, provided strong fodder for the Legislature to understand and address many of the abuses dealt with by this package. And, MKB partner Zach Matthews testified before the Georgia House, twice in 2020 and once again in 2025, thereby bringing specific details to the lawmakers that otherwise would have been concealed from them.
Although the bill that ultimately made its way out of the Georgia Legislature did not have everything that was needed to comprehensively address the fraud and waste in Georgia’s tort system, it nevertheless represents a major step forward in the quest for a fair playing field – especially at trial.
This article will analyze all nine major components of what had been dubbed Senate Bill 68, including the implications of certain new laws that were not necessarily stated with clarity by our Legislature. Meanwhile, Senate Bill 69, a companion bill addressing third party litigation funders, is still making its way through the Legislature but is ultimately expected to pass in some form—and will be briefly addressed below.
Table of Contents
Section 1 – Anchoring
Section 2 – Discovery Stay Upon Filing of Motions to Dismiss
Section 3 – Permissive Dismissals
Section 4 – No Double Recovery of Attorney Fees
Section 5 – Non-Use of Seat Belts Admissible
Section 6 – Negligent Security Overhaul
Section 7 – Phantom Damages
Section 8 – Bifurcation of Trials
Section 9 – Effectiveness
Senate Bill 68
Senate Bill 68 was offered and successfully advocated by Georgia Senate President Pro Tempore John F. Kennedy (R-Macon) in close cooperation with Governor Brian Kemp’s office. It has nine sections, each of which address a different element of fraud, abuse, or plain unfairness, that amounted to some of the main reasons why Georgia found itself listed as “Number One” on the Judicial Hellholes list promulgated by the American Tort Reform Association.
Section 1 – Anchoring
Section 1 of the bill addresses the popularity of “anchoring,” an argumentative tactic endorsed by the Plaintiff’s personal injury bar in many seminars nationwide. “Anchoring” means offering the jury a pie-in-the-sky dollar value comparison, often the multi-year salary of a major sports figure, in order plant a suggestion and to get the jury thinking about higher numbers. (Many argue that this maneuver is also intended to create an emotional sense of disgruntlement, that can lead jurors to want to “play Fairy Godmother” by awarding extravagant damages to a plaintiff. Such arguments are strongest when the Plaintiff’s injuries are undisputed and catastrophic, leading to so-called “nuclear verdicts”). Anchoring is fundamentally all about driving verdicts above and beyond the fair recoveries that are supposed bring people who are legitimately hurt back to the status they had before their injury—which is the structure our civil justice system is supposed to endorse.
Under Section 1, which will now be codified at O.C.G.A. § 9-10-184, the draft bill would have meant lawyers were no longer allowed to “argue” non-economic damages at all, meaning dollar values outside of those actually in evidence as special damages:
[C]ounsel shall not argue the worth or monetary value of noneconomic damages, and counsel shall not, in the hearing of the jury or any prospective juror, elicit any testimony regarding, or make any reference to, any specific amount or range of amounts of noneconomic damages, the measure of such damages being the enlightened conscience of an impartial jury.
This element was widely reported at the time, and there may already be a misconception that the new law “bans anchoring.” However, after the typical level of horse-trading in the Legislature, a subsection (C) was added, which re-opened the door to “anchoring” arguments in both opening statements and closing argument, as follows:
(1) In the trial of any action to recover damages for bodily injury or wrongful death, counsel for any party shall be allowed to argue the worth or monetary value of noneconomic damages only after the close of evidence and at the time of such first opportunity to argue the issue of damages provided that such argument shall be rationally related to the evidence of noneconomic damages and shall not make reference to objects or values having no rational connection to the facts proved by the evidence.
(2) If counsel is entitled to the opening and concluding arguments, then counsel shall not be allowed to argue the worth or monetary value of noneconomic damages during such counsel’s concluding argument unless counsel has argued the worth or monetary value of noneconomic damages during such counsel’s opening argument, and such counsel shall not argue a different worth or monetary value of noneconomic damages in concluding arguments than was argued in such counsel’s opening argument.
A very good argument can be made that this law is actually nothing new. Under existing law, jurors have already been instructed that they are to follow the evidence and also that lawyers’ arguments are not testimony. Offering the jury some “everybody knows” figure, like major league baseball star Mike Trout’s purported salary, is actually nothing more than a violation of the basic principles that a juror should consider the evidence, not extrinsic material. Such arguments also likely violate the hearsay rule, because “Mike Trout’s salary” is unlikely to ever be in evidence—but judges in Georgia had grown more and more permissive about allowing such arguments to reach the jury.
The Courts’ interpretation of the “no rational connection” language will determine whether the anti-anchoring provisions of the new bill have teeth, or prove to be watered down to the point of potentially having no impact on trials at all. Under the new law, plaintiff’s counsel will still be allowed to argue non-economic damages in both opening and closing (which was already the only time counsel is allowed to argue at trial). But, counsel’s argument should now have guardrails, for example outlawing discussion of a major league baseball player’s salary in a car wreck case. Of potentially equal importance is the fact that a Plaintiff’s lawyer will now be obligated to offer a non-economic damages figure in opening statement, if he or she plans to argue non-economic damages in closing—and the figure may not change between the two arguments. This will prevent Plaintiff’s counsel from overstating the figure early in order to “look reasonable” by asking for somewhat less in closing argument. Overall, after revision, Section 1 is the part of the law that is most susceptible to interpretation by the Courts, which will ultimately determine how strong an effect – if any – the anti-anchoring provisions have.
Section 2 – Discovery Stay Upon Filing of Motions to Dismiss
Section 2 addressed a common annoyance expressed by defense lawyers under the existing code. O.C.G.A. § 9-11-12, which is modeled on Fed.R.Civ.P. 12, allows a defendant to move to dismiss a case where there is no dispute of fact and no proper case has been presented. Typical scenarios for such a motion would include a blown statute of limitations, a lawsuit improperly filed against an entity with a similar-sounding name to the correct Defendant, or a significant failure of process or service of process.
Under existing O.C.G.A. § 9-11-12 (j), a motion to dismiss was intended to freeze proceedings, including discovery, until the Court ruled on the motion—which was intended to take place within 90 days. The problem was that the law prescribed no guidance for the situation where a Court failed to rule within 90 days, which was oftentimes the case given the busy dockets in Georgia. Indeed, MKB has experienced many cases in which motions to dismiss have gone without rulings for months, or in some circumstances (mostly in Metro Atlanta) even years.
The new law fixes that issue. Under new subsection (a), a Defendant may elect to file a motion to dismiss in lieu of filing its Answer, and if it chooses to do so, Discovery will be automatically stayed until the Court rules on that motion (regardless of how long that takes).
There is one very important wrinkle for practitioners: a Defendant who files an Answer will immediately terminate the Discovery stay. The typical procedure previously had been for Defendants to file Special Appearances by Way of Answer at the same time as filing a Motion to Dismiss. Under the new statute’s subpart (j) (1), doing so would immediately open Discovery:
[P]rovided, however, that, if a defendant files an answer before the ruling of the court on such motion, the stay imposed by this subsection shall immediately terminate with respect to such defendant[.]
The correct procedure going forward will be to move to dismiss, but hold off on filing any Answer until the Court rules on that motion. Under subpart (a) of the new law, a Defendant who has moved to dismiss but sees that motion denied will then have 15 days to file his or her Answer, after the order of denial issues.
This is a needed change that should go far in ensuring that Courts actually achieve the Legislature’s goals. Moreover, this change provides clarity for practitioners on both sides, so there is never any question as to whether Discovery has opened or not.
Section 3 – Permissive Dismissals
Section 3 represents a legitimate re-balancing of a procedural advantage that the Plaintiff’s bar had enjoyed for years. Under the existing code, Plaintiffs have “one free dismissal,” pursuant to the permissive dismissal statute, O.C.G.A. § 9-11-41. This meant that a Plaintiff could dismiss without prejudice at any time, for any reason, up until the first witness was sworn in at trial. Once dismissed, the case could then be re-filed with a clean slate (but only once).
Plaintiffs’ lawyers regularly abused this right, which was unique to Georgia state law. For example, in a number of cases in which there was no disputed fact and no legitimate reason to deny pending motions for summary judgment, MKB lawyers have seen cases dismissed without prejudice rather than a Plaintiff’s lawyer awaiting a Court’s ruling (which would presumably have been against his client). This sudden dismissal was often immediately followed by a re-filing in a different venue (for example, Superior Court instead of State Court), in order to force a change in the judge overseeing the case. In other words, this tactic was often used by Plaintiffs’ lawyers to forum-shop. Personal injury lawyers also regularly abused the permissive dismissal statute, where they had simply failed to push their cases forward, thus forcing defendants to incur months of legal expenses followed by a sudden dismissal and refiling, essentially re-starting the action.
Under the new law, which is still codified at O.C.G.A. § 9-11-41, a Plaintiff will only be allowed to pull the lever on permissive dismissal within the first 60 days after a Defendant files an answer. This is a strong correction that was desperately needed to curb some of the forum-shopping abuses that were becoming routine. Plaintiffs’ lawyers will also now be in a posture of needing to push their cases forward diligently, rather than relying on the ‘get out of jail free’ card they have enjoyed for years.
Section 4 – No Double Recovery of Attorney Fees
Section 4 addresses a recent run of Georgia appellate caselaw that had interpreted the existing “attorney fee shifting” statutes to, in limited circumstances, allow a double recovery of such fees. Under the existing code, O.C.G.A. § 13-6-11 allows a Plaintiff to recover his or her attorney fees (typically assessed as 40% of the total award) if the jury finds that Defendants acted in “bad faith” at the time of the underlying occurrence, or have been “stubbornly litigious” since then.
Meanwhile, O.C.G.A. § 9-11-68 allows a party to make an offer of settlement to the other side. In the case of a Plaintiff making such an offer, if the Plaintiff ultimately succeeds in garnering an award of 125% or greater than the offer of settlement he or she properly made under O.C.G.A. § 9-11-68, then the Plaintiff also automatically recovers his or her attorney fees and expenses – again, generally assessed as 40% of the total award.
In the 2022 case of Junior v. Graham, 313 Ga. 420, 870 S.E.2d 378 (2022), the Georgia Supreme Court held that a Plaintiff who triggered both an O.C.G.A. § 13-6-11 award and also triggered the offer of settlement statute, O.C.G.A. § 9-11-68, would be entitled to a double recovery of fees, which was being assessed as 40% of the first jury’s award, then re-compounded a second time as 40% of that already-inflated figure. In other words, if a Plaintiff was awarded $1,000,000 by the jury and both statutes were triggered, he or she could see a final judgment of $1,000.000 X 1.4 (the first fee shift award) X 1.4 (the second fee shift award) = $1,960,000 (almost twice the actual number the jury gave in damages).
The tort reform bill adds a new code section, O.C.G.A. § 9-15-16, that eliminates any double recovery of attorney fees, and effectively reverses Junior v. Graham by statute for cases going forward:
[N]o party shall recover the same attorney’s fees, court costs, or expenses of litigation more than once pursuant to one or more statutes authorizing awards of attorney’s fees, court costs, or expenses of litigation, whether such statute or statutes authorize such awards for compensatory or punitive purposes, unless the statute or statutes specifically authorize the recovery of duplicate attorney’s fees, court costs, or expenses of litigation.
The new bill also provides that no contingency fee agreement shall be admissible as evidence of the value of those bills, presumably leaving the jury (or court) to work out a fair compensation using other factors.
Section 4 of the bill was needed, but the scenario giving rise to a double recovery did not actually occur very often in Georgia practice. The greatest impact of this new bill will be on settlement negotiations, particularly after known facts have changed. One of the personal injury bar’s favorite tactics is to send a policy limits demand to an insurer, known in Georgia as Holt demand (similar to a Stowers demand in Texas, or a Tyger River demand in South Carolina). These demands for policy limits often include less than complete information, such as out-of-date special damages figures or missing “bad facts” details on the Defendant insureds, that may be known to Plaintiffs’ counsel but unknown to the Defendants’ insurers.
As cases develop and bad facts become known, insurers often realize that exposures are greater than they once seemed, potentially giving rise to “bad faith [at the time of the underlying transaction]” or “stubborn litigiousness [since then],” making for unforeseen exposure under O.C.G.A. § 13-6-11. This is particularly troublesome when the insurer has already rejected an O.C.G.A. § 9-11-68 demand because it was still operating on incomplete information by the time the bad facts come to light. In such scenarios, the current state of the law has been used to threaten a “double recovery of fees” under Junior v. Graham to leverage maximum settlement payouts – as shown in the math equation above, such a situation can effectively double a Defendant’s (and thus its insurer’s exposure). This revision to the code will at least take such a double recovery of attorney fees risk off the board, eliminating what had been a very valuable (to personal injury lawyers), albeit quite rarely used, loophole in the law.
Section 5 – Non-Use of Seat Belts Admissible
Section 5 addresses what was probably the best example of just how out-of-balance Georgia tort law had become. Until this bill passed, it was illegal to tell a jury whether or not a Plaintiff was wearing his or her seatbelt at the time of a car wreck. Seatbelts have been basic safety equipment mandated on American automobiles by NHTSA since 1968, but somehow Georgia jurors were forbidden from knowing whether or not a Plaintiff took that bare minimum level of precaution for his or her own safety. This was a clear example of the kind of political power that personal injury lawyers have exerted over this state in years past.
Now, thanks to Governor Kemp’s initiative, O.C.G.A. § 40-8-76.1 has been amended to state:
The failure of an occupant of a motor vehicle to wear a seat safety belt in any seat of a motor vehicle which has a seat safety belt or belts may be considered in any civil action as evidence admissible on the issues of negligence, comparative negligence, causation, assumption of risk, or apportionment of fault or for any other purpose.
The decision of whether or not that information is actually admissible will still be with the judge – but the use of a seatbelt will clearly be relevant in almost any personal injury action.
Section 6 – Negligent Security Overhaul
We come now to one of the most comprehensive changes in Georgia law: negligent security reform. Section 6 of this bill was absolutely needed to address arguably the most egregious abuse of the civil justice system in the state. “Negligent security” has become a broad tort in Georgia. In many other states, including adjacent Tennessee, the common law rule prevails, which that says an intervening third party tortfeasor who commits a criminal act and harms someone thereby breaks the chain of proximate causation between even a negligent landowner, and the injuries sustained, so long as the criminal act was not reasonably foreseeable.
This law is most applicable in shooting cases. In many states, a landowner could not be held responsible if a gang war suddenly erupted and bullets flew across owned property, resulting in injury to an innocent bystander. After all, in this hypothetical (which is sadly not hypothetical at all in Georgia), the gangbangers were the ones who pulled the triggers—not the landowner. In Georgia, however, such a landowner would likely face serious liability exposure that in recent years has grown into the tens of millions of dollars.
Many of the best lawyers in the Georgia Trial Lawyers Association have focused their practices on the concept of “negligent security,” meaning an effort to blame landowners for failing to keep the peace on his or her premises. And, Georgia juries, especially in metropolitan counties, have proven willing to accept those arguments, holding landowners accountable for the criminal actions of others. As a result of this situation, trial lawyers have made hundreds of millions of dollars in profits, almost entirely from national liability insurers—while notably achieving no perceptible change whatsoever in public safety in the inner cities. Indeed, the trial lawyers’ predatory tactics on inner city premises owners have clearly made matters worse, by making some areas de facto uninsurable. Whatever those trial lawyers may argue in the media, urban blight is a societal problem, requiring redress on many levels—not an easy issue than can simply be litigated out of existence.
It is not unfair or inequitable to want to hold bad landowners accountable for failing to keep their premises in repair. Those areas cry out for change. But, the biggest problem is that every other landowner – including many that are blameless for urban blight or even working diligently to prevent it – have been getting unfairly targeted with the same multi-million-dollar tactics by personal injury lawyers. As a result, the biggest possible positive change – new investment in bad areas to make them better – has become impossible. One of the most effective advocates for 2025’s tort reform package was an urban housing advocacy organization, which correctly noted that it could not achieve its goals of building homes for the unhoused, when insurance rates for liability coverage were sky high due to Georgia’s broken tort system.
This all came to a head as a result of 2023’s landmark case, Georgia CVS Pharmacy, LLC v. Carmichael, 316 Ga. 718, 890 S.E.2d 209 (2023), in which the Georgia Supreme Court upheld a 2012 verdict awarding $43M to a man shot in a CVS pharmacy parking lot. The injured man had come to the parking lot to conduct a Craigslist transaction – not to shop at CVS. After completing the sale of goods that had nothing to do with CVS or its business, an unknown assailant jumped into Plaintiff’s vehicle and shot him. Even though he did no business with CVS and did not even intend to do business with CVS, the trial court nevertheless construed the Plaintiff as an invitee of CVS and instructed the jury on an invitee’s duty. The jury apportioned 95% of the fault for the injury to CVS, along with 5% to the Plaintiff, meanwhile attributing no fault whatsoever to the shooter.
Bad facts make bad law, and this case became the classic example of overreach. By successfully arguing to uphold such an absurd result, the Plaintiffs’ bar simply managed to shine a spotlight on the glaring unfairness of Georgia’s current tort system. In other words, if the law legitimately allowed such a result, then the law needed to be changed—pure and simple. And that is exactly what the Legislature just did.
O.C.G.A. § 51-3-50 radically changes the analysis when it comes to negligent security. First, it offers a statutory definition of the concept for the first time:
(1) ‘Negligent security’ means any claim against an owner or occupier, or against a security contractor, that:
(A) Sounds in tort or nuisance, including, but not limited to, any claim under Article 1 of this chapter;
(B) Seeks to recover damages for bodily injury or wrongful death; and
(C) Arises from an alleged failure to keep the premises and approaches safe from the wrongful conduct of third persons.
It then proceeds to set a definition for the kind of notice that must be given to a landowner in order to hold the landowner or any occupier of that land liable for “negligent security”:
(3) ‘Particularized warning of imminent wrongful conduct by a third person’ means information actually known to an owner or occupier and deemed credible by the owner or occupier, which causes the owner or occupier to consciously understand that a third person is likely to imminently engage in wrongful conduct on the premises that poses a clear danger to the safety of persons upon the premises, such information being specific as to the identity of the third person, the nature and character of the wrongful conduct, the degree of dangerousness of the wrongful conduct, and the location, time, and circumstances of the wrongful conduct.
It also offers a new definition of a “prior occurrence”:
(5) ‘Prior occurrences of substantially similar wrongful conduct’ means prior occurrences of wrongful conduct which are sufficiently similar in nature and character, degree of dangerousness, proximity, location, time, and circumstances to the wrongful conduct from which a claim of negligent security arises to lead a reasonable person in the position of the owner or occupier to apprehend that such wrongful conduct is reasonably likely to occur upon the premises, to understand the risk of injury to persons upon the premises presented by such wrongful conduct, and to understand that a specific and known physical condition of the premises has created a risk of such wrongful conduct on the premises that is substantially greater than the general risk of such wrongful conduct in the vicinity of the premises.
The operative element of the new statute is codified at O.C.G.A. § 51-3-51, which states in full as follows:
Except as provided in Code Section 51-3-54, an owner or occupier shall be liable for negligent security arising from any injury sustained by any person upon the premises of the owner or occupier as an invitee if the plaintiff proves that:
(1) The wrongful conduct by a third person that caused the injury sustained by the invitee was reasonably foreseeable because the owner or occupier:
(a) Had particularized warning of imminent wrongful conduct by a third person; or
(b) Reasonably should have known that a third person was reasonably likely to engage in such wrongful conduct upon the premises, based on:
(i) Prior occurrences of substantially similar wrongful conduct upon the premises of which the owner or occupier had actual knowledge;
(ii) Prior occurrences of substantially similar wrongful conduct upon the property adjoining the premises, or otherwise occurring within 500 yards of the premises, of which the owner or occupier had actual knowledge; or
(iii) Prior occurrences of substantially similar wrongful conduct by the third person whose wrongful conduct caused the injury, if the owner or occupier knew or should have known, by clear and convincing evidence, that such third person was or would be upon the premises and if the owner or occupier had actual knowledge of such prior occurrences of substantially similar wrongful conduct;
(2) The injury sustained by the invitee was a reasonably foreseeable consequence of such wrongful conduct by a third person;
(3) Such wrongful conduct by a third person was a reasonably foreseeable consequence of such third person exploiting a specific physical condition of the premises known to the owner or occupier, which created a reasonably foreseeable risk of wrongful conduct on the premises that was substantially greater than the general risk of wrongful conduct in the vicinity of the premises;
(4) The owner or occupier failed to exercise ordinary care to remedy or mitigate such specific and known physical condition of the premises and to otherwise keep the premises safe from such wrongful conduct by a third person; and
(5) Such failure of the owner or occupier to exercise ordinary care was a proximate cause of the injury sustained by the invitee.
Needless to say, the number of cases in which a landowner has the level of knowledge contemplated by the new law before an injury occurs will likely be limited to those in which the landowner himself causes the harm.
The next section, new O.C.G.A. § 51-3-52, also sets an even higher bar for recovery against a landowner in the case of licensees (as opposed to invitees). And, new O.C.G.A. § 51-3-53 establishes that the negligent security structure established by these laws shall be an “exclusive remedy.” New O.C.G.A. § 51-3-54 immunizes landowners from negligent security claims from trespassers, while new O.C.G.A. § 51-3-55 makes clear that landowners are not obligated to essentially perform the role of the police in keeping order on their property.
Critically, new O.C.G.A. § 51-3-56 directly addresses the absurdity of the CVS case holding, making it mandatory that a jury at least apportion a reasonable degree of fault to the actual person who committed the criminal act, or else see the verdict set aside. Finally, new O.C.G.A. § 51-3-57 extends the protections of the prior set of laws to security contractors hired by landowners.
The Georgia Trial Lawyers’ Association pulled out all the stops to prevent the passage of this law. As noted above, trial lawyers typically recover 40% of any amount awarded by a jury. In an area of law where juries have been routinely awarding eight figure verdicts, it is not difficult to see the incentive structure in play.
Section 7 – Phantom Damages
Section 7 addresses the extreme burden put on Georgia’s civil justice system by phantom damages. Phantom damages are best defined as the amounts that doctors bill, but never expect to actually get paid. Because of the arms’ race between health insurers and doctors, it is now common in the medical space for a hospital facility or doctor to charge $100 in the hopes of being paid $25. Typically, payments received by doctors come from health insurers, and 89% of Georgians have some form of health insurance according to publicly-available statistics. Health insurers have contracts with each clinic or hospital that dictate the far lower percentage amount they actually pay for each service. That system is unwieldy and maybe even somewhat ridiculous, but in the healthcare space at least everyone knows how the system works. Not so in the jury trial system.
Georgia courts have historically applied the “Collateral Source Rule” to keep jurors from learning that the amounts charged by medical practitioners are, in effect, fictional. And, in the last fifteen years, new predatory clinics have arisen that specialize in the lawsuit injury model, specifically because information on the true market value of their bills is hidden from juries. These “lien clinics” drive people away from using their health insurance so they can perform often risky and unapproved procedures without any oversight from other medical professionals, at steeply inflated charges. At its simplest level, a doctor who is willing to do nothing but treat lawsuit plaintiffs on a lien can make a great deal more money than he or she would have made as a general practitioner, and also will never have to answer to any other medical professional about whether or not his services were medically necessary. This creates quite an allure.
Section 7 addresses those abuses by setting up a new damages structure, via O.C.G.A. § 51-12-12.1. New subparts (c) through (f) offer the operative language:
(c) If the plaintiff in any such civil action has any form of public or private health insurance, including benefits under a governmental workers’ compensation program, evidence relevant to the determination of the reasonable value of medically necessary care, treatment, or services pursuant to subsection (b) of this Code section shall include both the amounts charged for past, present, or future medical and healthcare expenses and the amounts actually necessary to satisfy such charges pursuant to the insurance contract or the applicable governmental workers’ compensation program, regardless of whether the health insurance has been used, is used, or will be used to satisfy such charges.
(d) In any claim for medical and healthcare expenses rendered under a letter of protection or any other arrangement by which a healthcare provider renders treatment in exchange for a promise of payment for the plaintiff’s medical and healthcare expenses from any judgment or settlement of a civil action to recover damages resulting from injury or death to a person, regardless of how such arrangement is referred to, the following shall be relevant and discoverable:
(1) A copy of the letter of protection;
(2) All charges for the plaintiff’s medical and healthcare expenses, which shall be itemized and, to the extent applicable, coded according to generally accepted medical billing practices;
(3) If the healthcare provider sells the accounts receivable for the plaintiff’s medical and healthcare expenses to a third party at less than the invoice price:
(A) The name of the third party; and
(B) The dollar amount for which the third party purchased such accounts receivable; and
(4) Whether the claimant was referred for treatment under a letter of protection or other similar arrangement and, if so, the identity of the person who made the referral.
(e) It is the intent of the General Assembly that this Code section abrogates the common law collateral source rule to the extent necessary to introduce the evidence described in this Code section; provided, however, that nothing in this Code section shall be construed or applied to prevent the court from issuing appropriate jury instructions to clarify the role of collateral source payments and to prevent potential jury confusion regarding the effect of collateral source payments on the plaintiff’s recovery.
(f) Nothing in this Code section shall be construed or applied to limit the right of a plaintiff or defendant to present evidence or testimony, or both, challenging the reasonableness of medical and healthcare expenses, whether incurred or projected future expenses, or the medical necessity of any treatment.
Under the new law, the amount the Plaintiff’s health insurer would have paid for the treatment will become relevant and admissible whether or not the Plaintiff actually used his or her insurance. The jury will also learn whether or not the Plaintiff has health insurance.
This provision will go a long way towards cleaning up the abuse of phantom damages, especially by lien clinics. The law also makes certain referral information, which was already discoverable under case law precedent, both discoverable and relevant by statute. This will help get the jury the true facts in the very common situation where a Plaintiff’s lawyer has actually been the one directing and controlling the Plaintiff’s treatment.
And, the law is clear via subpart (f) that this way of analyzing reasonableness and necessity is non-exclusive, in noted contrast to the exclusivity provisions of the negligent security code sections analyzed above. This means that firms like MKB, that have other means of analyzing reasonableness and necessity, will not be foreclosed from offering even more evidence to challenge the bills by this statute.
There is one potential negative externality that this law may create, depending on how Courts interpret the operative timeframe of the “insurance comparison” language. If the Courts decide that a Defendant may compare a Plaintiff’s charges to applicable insurance rates provided the Plaintiff had insurance on the day of the accident, then the large majority of claims should be captured and phantom damages will be dealt a significant blow. But, if the Courts determine that the “insurance comparison” can only be made if a Plaintiff has applicable insurance in effect at the time of treatment, then lien clinics will be incentivized to convince Plaintiffs not just to stay away from using their insurance, but rather to drop their insurance altogether. If the Courts allow Plaintiffs to get away with dropping their insurance to avoid the comparison effects of the new Phantom Damages bill, then Plaintiffs’ lawyers are sure to at least argue that the old Collateral Source Rule still applies – and more legislation may be needed.
The statute’s omission of a clear comparative tool for uninsured Plaintiffs is very likely to engender further legislation, particularly if bad actors run through the loophole by convincing more and more lawsuit Plaintiffs to give up their insurance altogether, in an effort to continue pulling the wool over jurors’ eyes as to how much their care is really worth. The proper way to close this loophole would be to simply to allow the jury to see the amount the lien clinics have been receiving on average for the services they rendered to the Plaintiff. That “fair market value” analysis has many analogues in Georgia law, such as how the courts have historically valued legal services, or a used car or even the fair sale price of a home.
The GTLA is very likely to challenge this part of the Tort Reform bill on Constitutional grounds, likely by citing a 1991 opinion called Denton v. Con-Way S. Exp., Inc., 261 Ga. 41, 402 S.E.2d 269 (1991), in which the then-sitting Supreme Court panel held that the Legislature’s last statutory abrogation of the Collateral Source Rule was unconstitutional (on Equal Protection grounds). The problem the GTLA will run into is that Denton was overturned the following year by Grissom v. Gleason, 262 Ga. 374, 418 S.E.2d 27 (1992), in which the Supreme Court walked back its prior Equal Protection analysis, calling its own holding in Denton “an aberration.”
It is MKB’s analysis that the Legislature does have the Constitutional right in Georgia to abrogate the Collateral Source Rule if it wants to. The Collateral Source Rule is nothing more than a common law rule of evidence, that appears nowhere in the Georgia Constitution. Its only “Constitutional” underpinning was via the Equal Protection analysis offered only one time in Denton, that was then rejected the very next year in Grissom. And, traditional applications of the Rule were never meant to deal with the Phantom Damages billing structure that has only arisen in the past fifteen to twenty years. Thus, while appellate litigation on this issue is likely, the new Phantom Damages law is likely to stand, barring political change in the Legislature.
Section 8 – Bifurcation of Trials
Section 8 proved to be one of the most controversial elements of the new law, even though its logical underpinnings are some of the most elementary. Trials typically involve two stages: first, determination of liability, and second, the amount of damages to be awarded. Importantly, since the enactment of the apportionment statute in 2005, Georgia’s judges also have been charged with reducing any amount awarded by the jury by the percentage of fault assessed to a given Defendant.
The trouble is that trials have not traditionally kept these two phases all that distinct. As such, it has been very common for a jury to be presented with testimony as to liability and testimony as to damages at the same time. Such a presentation can absolutely tug the heart strings, even though jurors are always instructed by the Court not to let sympathy affect their verdict.
Under the new law, these phases of trial will be much more distinct, through a process called “bifurcation.” A bifurcated trial will go forward first as to only the liability factors, meaning the jury will need to be charged and will need to deliberate halfway through a trial. And, because apportionment is a component of the liability analysis, any apportioned fault will need to be determined and announced by the jury in this first phase – before it hears any damages.
If the jury finds that a particular Plaintiff was 50% or more at fault for his or her own injuries, then the trial would end then and there. If the jury finds the Plaintiff to be less than 50% at fault, then the trial would re-commence as to damages. In the second phase, the Plaintiff would proceed to tell the jury about the harm he or she alleged suffered, and the jury would hear evidence of the dollar value of those injuries.
The idea behind this law is to get jurors to assess liability in as neutral a way as possible, based only on the facts presented, not on the facts plus sympathy factors for injured plaintiffs. (And this is the reason why the Georgia Trial Lawyers Association hates the law so much: divorcing liability from damages will erase one of their key advantages – sympathy – which is not supposed to be any part of the jury’s analysis in the first place).
Again, as the bill progressed through the Legislature, a certain amount of horse-trading occurred. As amended, mandatory bifurcation of trial will not apply in any case with an amount in controversy of less than $150,000, or in cases involving alleged sexual assault. (The latter was a humanitarian compromise to prevent assault victims from having to give their testimony twice).
O.C.G.A. § 51-12-15 contains the text of the new bifurcation statute, as follows:
(a) In any action to recover damages for bodily injury or wrongful death, any party may elect, by written demand prior to the entry of the pretrial order, to have fault and any award of damages determined at trial in the following manner:
(1) In the first phase of the trial, the trier of fact shall determine the fault of each defendant, and if the trier of fact finds that any defendant is at fault for the plaintiff’s injuries or wrongful death, the trier of fact shall further determine through an appropriate form of the verdict the percentages of fault of all persons or entities that contributed to such injuries or wrongful death as provided in Code Section 51-12-33, prior to any determination of the total amount of damages to be awarded, if any such findings are required. The evidence and arguments of counsel in the first phase of the trial shall be limited to the issues provided for in this paragraph;
(2) If the trier of fact finds in the first phase of the trial that any defendant is at fault for the plaintiff’s injuries or wrongful death, the trial shall be recommenced immediately with the same judge and the same jury. In the second phase of the trial, the trier of fact shall determine all compensatory damages to be awarded to the plaintiff, if any, and the evidence and arguments of counsel shall be limited to this issue; and
(3) If the trier of fact finds in the second phase of the trial that any compensatory damages are to be awarded to the plaintiff, the trial may be recommenced immediately with the same judge and the same jury for such further proceedings as may be required, including, but not limited to, proceedings provided for in subsection (d) of Code Section 51-12-5.1 concerning punitive damages and proceedings to determine liability for, and the amount of, any attorney’s fees, court costs, or expenses of litigation that may be awarded by the trier of fact as provided by law.
(b) The court may reject an election by any party made pursuant to subsection (a) of this Code section and order the concurrent trial of fault and damages only upon motion by any party in opposition to such election and upon the court’s determination that:
(1) The plaintiff, or if the plaintiff is the legal guardian of a minor, the minor, was injured by an alleged sexual offense and would be likely to suffer serious psychological or emotional distress as a result of testifying more than once in a bifurcated proceeding; or
(2) The amount in controversy is less than $150,000.00.
The courts will need to make a determination as to whether the case poses a $150,000 amount in controversy or not. MKB expects judges to look to federal diversity removal law for that issue. In cases involving an alleged sexual offense, the Court will need to determine if the victim is at risk of “serious psychological or emotional distress,” in order to decide whether to bifurcate or not. Most of those cases will likely avoid bifurcation.
Once again, MKB anticipates a Constitutional attack on this bill, likely on equal protection grounds. During witness testimony in the House, GTLA spokespeople raised the argument that this law treats personal injury tort claimants differently than it treats other types of plaintiffs, for instance in contract disputes. Of course, contract disputes do not typically involve any need to separate sympathy factors from the barebones analysis of liability, nor is materiality of a contractual breach truly analogous to the jury’s decision as to liability and apportionment. So far, no one has convincingly raised any legitimate Constitutional reason why liability and damages should have be tried to a jury simultaneously as opposed to sequentially. But, “bad facts make bad law,” and it may be that in complex multi-party cases Defendants will have to make some tactical concessions to avoid giving the Plaintiff’s bar an unusual fact pattern that could tempt the appellate courts to overturn the law.
Section 9 – Effectiveness
The Legislature understood that many of the elements in play in this bill will represent large changes in how things are going to be done in Georgia. Thus, it added a section specifying which parts of the new law will take effect immediately, versus which will be delayed. And, it wisely tied the effectiveness of those two parts of the new law to the day the cause of action develops (meaning, in insurance terms, the “date of loss”), not the day the lawsuit was filed. This should help offset what happened in Florida, where tort reform saw a mass run on the courts as Plaintiff’s lawyers rushed to file under the old, unfair rules.
Under the enabling language of Section 9, only the provisions of Sections 6 and 7 of the Act, meaning negligent security reform and phantom damages reform, will be delayed. Every other part of the Act will kick in immediately. In Georgia:
Legislation which involves mere procedural or evidentiary changes may operate retrospectively; however, legislation which affects substantive rights may only operate prospectively. Enger v. Erwin, 245 Ga. 753, 754, 267 S.E.2d 25 (1980). The distinction is that a substantive law creates rights, duties, and obligations while a procedural law prescribes the methods of enforcing those rights, duties, and obligations. Polito v. Holland, 258 Ga. 54(3), 365 S.E.2d 273 (1988).
Fowler Properties, Inc. v. Dowland, 282 Ga. 76, 78, 646 S.E.2d 197, 200 (2007).
Functionally, no part of the 2025 tort reform act is likely to affect “substantive rights” except for Section 6 (Negligent Security). Even Section 7 (Phantom Damages) arguably only affects procedure—though the Legislature saw fit to dodge that discussion altogether by delaying the impact of this bill as to phantom damages as well.
The most immediate impact of the law is going to be the bifurcation provisions of Section 8. Section 1 (Anti-Anchoring) is also immediately effective, but the practical effect of that section will depend on Courts’ interpretation of the ‘”no rational connection” prohibition.
Future Impacts of Tort Reform and Next Steps
Overall, the Legislature’s tort reform efforts merit a round of applause, even if the bill ultimately did not achieve every one of the lawmakers’ stated goals. The trial lawyers’ lobby is very strong and very well funded, and passing anything over their strenuous objections was a real political coup both for Governor Kemp and his supporters in the Legislature. But, Kemp’s supporters were forced to trade away (or simply did not bring) some of the components of tort reform that would have done the most to actually cut insurance premiums in this state.
The two biggest policy gaps in the law – as passed – are both easy to see: first, the anti-anchoring provisions under Section One leave the interpretation of the “rational connection” prohibition up to the Courts, which have already proven to be willing to give counsel great leeway in making opening and closing argument. That section also likely could have addressed and banned use of “Reptile Theory” tactics – which are a popular method of getting around the Golden Rule (i.e. “Thou shalt not ask the jury to place itself in the shoes of the Plaintiff”). Reptile Theory approaches to trials focus on inappropriately stirring the jurors’ emotions, and can be key drivers of nuclear verdicts.
The other gap in the law is in the Phantom Damages provision’s failure to state when the “insurance comparison” applies, which could wind up encouraging lien clinics to push their clients completely off their health insurance, instead of simply talking them out of using it. Actually convincing a patient to completely drop his or her insurance is clearly unethical, and would in theory open the lien clinics up to greater liability in the event of medical malpractice—but, nothing MKB lawyers have seen in the last ten years of litigating with these entities suggests they would be sufficiently deterred by those considerations, given the vast sums of money they have been making in this space.
Senate Bill 69 (dealing with third party litigation funding) is, as of writing, still working its way through the Legislature, and that bill could in theory still be strengthened to better govern lien clinics and litigation funders.
The truth is, until the lien clinics are truly dealt with, it may be difficult for Governor Kemp to make good on his implied promise to drive down everyday Georgians’ auto insurance rates. But, if the GTLA and its political arms continue to make the argument that rates have not (yet) been positively affected by Governor Kemp’s tort reform efforts, then specific provisions dealing with the lien clinics would be the most logical next steps to deliver on the Governor’s goals of lowering auto insurance premiums and making sure Georgia stays the number one place to do business in America.