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AAJ also lobbying to quietly pass plaintiff lawyer tax break

Following up on Walter's July 30 post, "AAJ looking to quietly pass plaintiff lawyer tax break," on the American Association for Justice's attempts to get Congress to pass a $1.6 billion tax break for trial lawyers, we follow the money.

The proposal, introduced as S. 437 and H.R. 2519, would allow the deduction of attorney-advanced expenses and court costs in contingency fee cases. But it's too politically toxic to move as a stand-alone bill so the AAJ is hunting for an appropriate legislative vehicle.

It's certainly a lobbying priority for the group. Not only does the AAJ list the issue on its 2nd Quarter 2009 lobbying disclosure form, they also hired outside lobbying firms to work on it.

Legislation to end medical device preemption gains a lot of attention among Congress watchers, and it's definitely a heavily lobbied issue, but as Victor Schwartz of Shook, Hardy & Bacon tells us, the bill would only benefit a small percentage of AAJ member attorneys. But deductions for contingency fee lawsuits? The benefit cuts across the entire membership, helping small firms and big ones. For a $1.6 billion tax break, you spend a little money.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.