Texans are facing higher costs for goods and services due to the impact of lawsuits and large court awards, according to a study by Citizens Against Lawsuit Abuse (CALA). The study indicates that Texans pay an average of $1,725 more annually, surpassing the national average lawsuit tax of $1,666 per person. Mike Hachtman, chairman of Texans Against Lawsuit Abuse, said, "While Texas has been at the forefront of lawsuit reform in the United States, this new study shows there’s still work to be done to defend and advance commonsense lawsuit reforms in our state."
The report was prepared by The Perryman Group and coincides with the Texas Legislature's consideration of Senate Bill 30. This bill aims to address "nuclear verdicts," which are substantial court awards that can inflate costs for businesses and consumers. State Sen. Charles Schwertner authored the bill, which is a priority for Lt. Governor Dan Patrick.
Between 2009 and 2023, Texas led in "nuclear verdicts," totaling over $45 billion from 207 cases. Bobby Jenkins, chairman of Citizens Against Lawsuit Abuse of Central Texas (CALACTX), commented on the broader implications: "We all pay for the cost of lawsuits, win or lose, and whether we’re involved in a lawsuit or not." He emphasized that such legal actions could hinder business growth and increase consumer prices.
The Perryman study highlights regional disparities within Texas regarding the lawsuit tax: $2,746 per person in Austin-Round Rock-Georgetown; $2,483 in Dallas-Fort Worth-Arlington; and $2,373 in Houston-The Woodlands-Sugar Land. Statewide economic losses include $33.6 billion in direct costs annually and job losses totaling 453,426.
Jenkins called for reforms to curb inflated medical bills and provide transparency: "We desperately need reforms to limit the ability of unscrupulous personal injury lawyers to shake down small businesses." Hachtman added that maintaining a fair civil justice system is crucial: "A strong and fair civil justice system is an integral part of American democracy."
For further information on Texans Against Lawsuit Abuse, visit www.tala.com.
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