Reforming Nuclear Verdicts, Public Nuisance Lawsuits Are Key Reform Measures
By Roger Borgelt
Does your pocketbook feel lighter? In addition to inflation, Texans also feel the pinch of what can best be described as a “lawsuit tax.”
Texans pay an average of $1,725 more for goods and services every year as the cost of lawsuits and massive court awards are passed on to consumers, a new study from Citizens Against Lawsuit Abuse (CALA) shows.
According to the study, this lawsuit tax is even as high as $2,746 per person in our bigger cities and well over the national average of $1,666 annually. Clearly, we need to rein in excessive lawsuits and massive court awards that drive up the costs consumers pay for virtually every item on the market.
Proposed legislation filed by lawmakers at the State Capitol could address some of the biggest drivers of this lawsuit tax.
Senate Bill 30, filed by state Sen. Charles Schwertner, seeks to address the problem of artificially inflated medical bills that feed unreasonable court awards. These court awards are so large, often exceeding $10 million, they are known as “nuclear verdicts.” As the name suggests, these outsized verdicts are nuclear-level in destruction, driving up costs for businesses and consumers and threatening the Texas business climate.
Between 2009 and 2023, Texas led the nation in the number of nuclear verdicts or court awards of $10 million or more. A total of 207 nuclear verdicts were awarded in Texas during that time, totaling more than $45 billion – costs often ultimately borne by consumers across the state.
In addition to addressing nuclear verdicts, the Texas Legislature should also pass Senate Bill 779, which will bring much-needed reform to a centuries-old, overly broad public nuisance law that has strayed from its original purpose. Some personal injury lawyers use public nuisance lawsuits to drive up monetary settlements and impose policy objectives through the courts instead of through legislatures.
Senate Bill 779 would address this obscure yet costly provision in our law, helping to ensure our courts are used for justice, not greed. This legislation specifies that lawful actions and products cannot be declared a nuisance to the public. This change is sensible and appropriate as it would not apply to private nuisance lawsuits involving private property owners or common nuisance lawsuits. Nor would it impact private lawsuits against defective products.
Texas’s work to rein in abusive lawsuits and legal practices has set the standard nationally. For decades, Citizens Against Lawsuit Abuse has championed change, raising the alarm on the costs and consequences of abusive, excessive lawsuits on consumers, taxpayers, and small business owners.
You don’t have to be a party to one of these abusive lawsuits to pay the price. As the lawsuit tax suggests, Texans from the kitchen table to the office pay more for virtually every product and service on the market due to costly, frivolous lawsuits.
That’s why, as lawmakers consider legislation at the state Capitol in Austin this spring, they should consider reforms that will strengthen the business climate, drive continued job creation, and protect access to our civil courts.
There’s much work to be done in Texas to defend our positive record of reform and guard against attacks and abuses on our civil justice system. Let’s encourage our Texas lawmakers to continue supporting lawsuit reform for Texas consumers and small businesses.
