Legal problems have caused thousands of Americans to lose virtually everything they own, often justly so but many times not justly at all. Lawsuits and threats of lawsuits have lead directly to far fewer products & services, fewer pharmaceutical drugs, fewer charitable and community service activities, etc. A relatively small number of currently active litigation lawyers (ranked in Forbes richest lawyers' list) have extracted billions of dollars from corporations, much of it ethically and logically unjustifiable. The problems with the litigation explosion are aggravated by the limited downside risk to the plaintiff. That is, they don't have to pay any of the defendant's legal costs even when the plaintiff loses. (Note that most of the rest of the world uses the "English Rule" which does allow a winning defendant to collect from the losing plaintiff). The amount of litigation also is aggravated by contingency fees; there is no risk at all to the plaintiff, and even the plaintiff's attorney can control his/her costs.

One of the worst litigation aggravations is the "joint and several liability" legal theory in the U.S. "Under joint and several liability there is no such thing as innocence or guilt. In fact, the only bad decision you can make is to be in business, or worse yet, to be successful...It punishes those who have done nothing wrong but who have the ability to pay. It disregards legal agreements and contracts. It allows one company to be sued in place of another, as if the identity of the (real) defendant were an impenetrable mystery.... A study...estimates the direct costs of the tort component of the civil justice system at $132 billion in 1991. That's 60% of what the U.S. spends on public education for kindergarten through 12th grade."*

What could cause a lawsuit that threatens your property? A major threat is from automobiles or other vehicles. If you, teenage children or anyone else you have lent your automobile to is in a vehicle accident, and the accident is the fault of the driver of your auto, your liability is almost unlimited. This is especially true if the accident kills one or more people, or causes serious and long term injury. These kinds of accidents can literally incur millions of dollars in legal damages. You may not afford or be able to get enough liability insurance to cover damages in those amounts. This leaves the rest of your property at tremendous risk. An accident victim, or the victim's family, can legally come after your home, vehicles, investments, vacation property, or anything else that you own.

Rental real estate creates serious liability problems for all the assets of the property owner. Construction and industrial equipment also have the potential for accidents which will subject the owner to claims or litigation. Owning or operating almost any business makes the business owner an open target for a host of lawsuits.

Joint tenancy property ownership with spouses, children or other heirs is extremely risky, with the size of the risk multiplied by the number of joint tenants.

The elderly face the confiscation of almost all their estate from Medicaid should they ever require long term health care.

Threats to your assets usually come from these sources: Divorces, environmental hazards, employees, creditors, bankruptcy, tax agencies and authorities, business customers, business competitors, business regulatory agencies, rental property accidents, lead paint hazards on home or rental property (which is not covered by most insurance policies), guest accidents at home, joint ownership of real estate (when the other joint tenant gets sued, divorced, etc.), involvement in partnerships, corporate officer and director positions, advisory board positions, and leadership positions in civic organizations.