During the COVID-19 pandemic, thousands of businesses were given Paycheck Protection Program (PPP) loans from the federal government to help mitigate lost revenue and cover payroll expenses. These loans were meant to be primarily used by small businesses for job retention and support.
However, questions have been raised after some large law firms received PPP loans and proceeded to increase spending in advertising.
According to an investigation in Legal Newsline:
“From March 2020 through December 2020, the firm aired about 70,000 ads at a cost of $10.5 million. The Journal said the firm’s advertising spending increased from $50,000 to $300,000 per day.
During the pandemic and just after it, legal advertising spending surged across the country from roughly $1.89 billion in 2020 to over $2.35 billion by 2022. That’s a 24.3% increase in television ads, billboards and digital promotions.”
PPP loans, funded by taxpayer money, were intended to help struggling small businesses pay their employees during an unprecedented hard time for business. Instead, large law firms took advantage of the loans while boosting their advertising services.
Bailey Aragon, director of public affairs for the American Tort Reform Association is quoted as saying:
“It’s just another example of the trial lawyer playbook at work: exploit loopholes, squeeze the system, and walk away richer, while everyday Americans are left footing the bill. This underscores why broader reforms and greater accountability for lawsuit abuse are so urgently needed.”
This behavior doesn’t just apply to big firms, smaller firms are also in the spotlight for extravagant spending after their PPP loans were forgiven:
“The Dimopoulos Law firm had its nearly $400,000 PPP loan forgiven in 2021… In 2023, he posted a video on Instagram of him eating caviar and drinking from a bottle of Louis XIII Cognac, which retails for more than $5,000 a bottle, with the caption “another day, another 900k.”
These examples highlight just one of the ways personal injury lawyers exploit our legal system and exploit taxpayer dollars.