If there's a disadvantage to loser-pays rules, it's the expense and inefficiency of post-matter litigation over attorneys' fees. The aftermath of the Granholm v. Heald Supreme Court case over interstate wine sales shows what one such collateral litigation can look like. Because the case was a Section 1983 action, the victorious plaintiffs were entitled to attorneys' fees, but the attorneys couldn't initially agree amongst themselves what those fees should be. Loser Michigan (who wouldn't have been eligible for its fees had it won under the one-way 42 USC 1988) complains aptly that they shouldn't be on the hook for redundant expenditures that came about because of "intramural differences" between lawyers. (Tony Mauro, "Courtside: Grapes of Wrath: Lawyers Locked In Fee Fight", Legal Times, Apr. 10) (via Lattman).
Granholm v. Heald aftermath