In Toyota’s Announcement, A (Successful) Tale of Legal Reform

By February 28, 2007Briefly Legal

In noting Toyota’s big announcement, below, we allude to the fact that Governors looking to lure investment need to create a climate that’s not hostile to business. While Mississippi had lots to celebrate yesterday, that wasn’t always the case.

Mississippi, as you may know, was long the home of some of the worst “Judicial Hellholes” in the country. There were outrageous verdicts down there that would even make the most shameless trial lawyers blush. And, they had a few high-profile trial lawyers in state government who helped foster the poisonous climate.

When Haley Barbour was elected, he aggressively set out to attract new business investment in his state. In 2004, he pursued a Toyota assembly plant. Toyota ultimately decided to locate the plant in San Antonio, Texas, a plant that is now fully operational and has predictably been a huge shot in the arm to the local and regional economy.

Barbour, understandably disappointed, contacted Toyota to ask why they hadn’t chosen Mississippi. In a letter, then-Senior Vice President Dennis Cuneo told Barbour that while Mississippi had many attractive features, Toyota decided against the Magnolia State as a location because, “the litigation climate in Mississippi is unfavorable, and negatively impacts the state’s business climate.”

This was all Barbour needed to push through the first wave of serious legal reforms. The state’s powerful trial bar was just plain run over by the public sentiment which galvanized against them in light of the now-famous letter.

That’s why yesterday’s announcement was so sweet for Gov. Barbour. He tackled an issue where few gave him any chance of success. But thanks to his “dogged determination,” as Trent Lott said yesterday, he was able to improve the economic climate of the state. For his troubles, he just landed a $1.3 billion investment that will make lives and livelihoods for hundreds of thousands of Mississippians for many decades to come.

And that’s more than the job-killing trial lawyers can claim.