Highway Accident Fairness Act of 2023 Attempts to Strengthen Penalties for Staged Commercial Motor Vehicle Accidents and Mandate Disclosure of Third-Party Litigation Funding

August 2023 • Source: Ney J. Gehman and Trent P. Roddy, Perrier & Lacoste

The Highway Accident Fairness Act (H.R. 2936)(118^th Congress) was introduced by Representative Henry Cuellar (D-TX) and cosponsored by Garret Graves (R-LA) and Mike Bost (R-IL) on April 27, 2023.  The bipartisan legislation is intended to make it a federal crime to intentionally cause an accident with a commercial vehicle and to make a false claim for damages. The goals of the Highway Accident Fairness Act of 2023 is to “reduce unnecessary lawsuits, lower car insurance rates, and increase safety on our roads.”[1]

The three main goals of the Act include establishing criminal penalties for staged highway accidents involving commercial motor vehicles (CMVs), provide federal courts jurisdiction in cases involving accidents with truck crashes involved in interstate commerce and exceeds $5 million; and to require the disclosure of third-party litigation financiers.[2]  

The Purpose of the Highway Accident Fairness Act

The purposes of the Act include:

(1)  Assure fair and prompt recoveries for highway accident victims;

(2)  Benefit society by preserving predictability and stability in the movement of freight in interstate commerce and lowering costs to the supply chain and, ultimately, all Americans;

(3)  Protect the motoring public from the safety hazard of staged collisions between passenger cars and commercial vehicles;

(4)  Prevent fraudulent claims that result from staged collisions;

(5)  Protect law enforcement agencies and highway departments from expending resources dealing with the aftermath of staged collisions; and

(6)  Minimize the impact of staged collisions on the supply chain and the movement of goods in interstate commerce.[3]

Staged Commercial Motor Vehicle Accidents

Without question, staged commercial motor vehicle accidents have emerged as an ongoing issue facing the trucking industry and their insurance carriers.  For example, a federal investigation continues in the Eastern District of Louisiana has focused on more than 150 accidents in the New Orleans area has led, to date, of more than fifty (50) individuals convicted for their involvement in staged accidents.  The foregoing included one lawsuit that resulted in a $4.7 million settlement alone prior to the fraudulent claims being exposed.[4]

 “Just incredibly selfish and irresponsible to do these sorts of things, which is why we’ve got to bring the FBI and other federal law enforcement to shut these things down,” said Representative Garret  of Louisiana.  “Once we learned about what happened down in New Orleans, we realized this is something that could not happen again.” 

“Our bill will prevent criminal rings that are intentionally causing accidents from driving up costs for the rest of us by cracking down on fraudulent claims, increasing safety on the roads, and lowering insurance rates for everyone,” said Graves.[5]

Third Party Legal Funding Disclosure

Another key component of the Highway Accident Fairness Act is for the disclosure of “any civil action in State or Federal court alleging bodily harm or loss of life involving one or more commercial motor vehicles, as defined in in section 31101 of title 49, operating on a public road in interstate commerce.”[6]  This wide-ranging requirement of disclosure would apply to any state or federal civil action “alleging bodily harm or loss  

Conclusion

It remains to be seen whether the Highway Accident Fairness Act of 2023 will be enacted in its current form, or will be revised or modified to increase its likelihood of enactment.[7]   The Highway Accident Fairness Act of 2021, which contained the same Third-Party Litigation Funding disclosure proposal, did not receive a vote in a prior session of Congress.  The bill has not currently been scheduled for debate.