Officials of the group, the American Tort Reform Association, also said that actions by Congress and the states "are critical elements" in reducing the cost of litigation and improving fairness in the system.

Regarding judicial action, Sherman Joyce, president of the ATRA, said he believes class action reform legislation has a good chance of enactment in the coming session of Congress.

The bill, whose strongest provision is moving class action lawsuits to federal courts, "should be even stronger than it currently is," Mr. Joyce said, but ATRA and other business groups support "early and prompt action."

On another legislation issue?asbestos reform?Mr. Joyce said that is a "much more difficult issue." He said "more work needs to be done" before the bill can pass Congress. But, he said, asbestos litigation "is an overwhelming problem and Congress needs to deal with it."

ATRA General Counsel Victor Schwartz, an experienced trial lawyer representing defendant companies and insurers, said the "overall trend" in class action litigation is "good," and things are even improving in the number one "judicial hellhole" of Madison County because a more moderate jurist has replaced a retired judge there.

Mr. Schwartz mentioned that while a $1 billion replacement parts case judgment against State Farm in Illinois is under appeal, the company is being charged 12 percent interest on the verdict. Interest rates on appealed judgments have not been lowered despite a precipitous drop in interest rates nationwide, he said.

Mr. Schwartz said that ATRA believes the State Farm parts verdict "should ultimately be overturned,"

Besides Madison County and nearby St. Clair County, Ill., the report identifies seven other "hellhole" jurisdictions: Hampton County, S.C.; the state of West Virginia; Jefferson County (Beaumont), Texas; Orleans Parish, La.; South Florida; Philadelphia, Pa.; and Los Angeles, Calif.

West Virginia made the list, ATRA said, after the state's Supreme Court ruled that a safety director fired for using cocaine on the job could not be terminated, even though the employee lied about using cocaine and "dishonesty" was in the employee's contract as grounds for dismissal.

"Dishonorable mentions" include Oklahoma, the Utah Supreme Court, the District of Columbia and New Mexico's appellate courts.

The report also "delisted" Jefferson County, Miss., as a "hellhole" following what ATRA officials called "a series of remarkable and positive changes that have taken place in Mississippi."

ATRA noted that after legislative changes Mississippi "has already begun to reap some of the benefits of the improving legal climate in the state." Specifically, it said that Massachusetts Mutual recently announced that it would reenter the market for Mississippi municipal bonds.

Also, Mississippi Insurance Commissioner George Dale has said that St. Paul Travelers will provide customers in the state by increasing homeowners and auto insureds. Mr. Dale also attributed a leveling-off of Mississippi's medical malpractice insurance rates to the legislative changes, ATRA said.

Mr. Schwartz said that "Litigation tourists, guided by their personal Injury lawyer agents file lawsuits In Judicial Hellholes because they know they will receive a large reward, a favorable precedent, or both. Defendants declare good reason to fear when sued in Judicial Hellholes."