Two bills introduced in the 89th Texas Legislature aim to reform lawsuits, and address what critics say are nuclear verdicts—the cost of which businesses pass on to consumers.
According to Texans Against Lawsuit Abuse, “nuclear verdicts,” or jury awards of $10 million or more, are driving up the cost of doing business in the state.
A Citizens Against Lawsuit Abuse study shows lawsuit costs and court awards cause Texans to spend an additional $1,725 annually on goods and services.
The national average annual lawsuit cost is $1,666 per person, which means Texans pay nearly 4% more, according to the study.
Between 2009 and 2023, Texas led the nation in the number of nuclear verdicts, with 207, totaling more than $45 billion, according to Texans Against Lawsuit Abuse.
The study’s publisher describes itself as tax-exempt grassroots organization, while another entity, the Center for Justice and Democracy at New York Law School claims the group “actually represent(s) major corporations and industries seeking to escape liability for the harm they cause consumers.”
Since 1991, these business groups, which refer to themselves as tort reform advocates, have set up dozens of these tax-exempt groups in 18 states, according to the Center for Justice and Democracy.
The study reported the “lawsuit tax” is even higher in the Austin-Round Rock-Georgetown area, where residents pay $2,746 each, up 39% from the national average.
It also reported higher expenses in Dallas-Fort Worth at $2,483, up nearly 33%; and $2,373, up almost 30%, per Texan in the Houston-The Woodlands-Sugar Land area.
These regional disparities in lawsuit costs underscore the need for comprehensive lawsuit reforms in Texas, according to Texans Against Lawsuit Abuse.
Statewide, the study found lawsuits in Texas drove economic losses at the local and state levels, including $33.6 billion in direct costs and 453,426 job losses.
Legislation in the Works
Now, two proposed laws in Texas aim to curb nuclear verdicts.
Senate Bill 30, sponsored by Sen. Charles Schwertner, R-Georgetown, includes reforms that aim to stop the manipulation and inflation of medical damages; and educate jurors on noneconomic damages by providing clear standards and definitions.
Another proposed law, Senate Bill 39, sponsored by Sen. Brian Birdwell, R-Granbury, focuses on the civil liability of a commercial motor vehicle owner or operator. The bill would narrow the circumstances under which commercial vehicle owners and operators can be liable for damages.
Lt. Gov. Dan Patrick has included both bills in his list of high-priority legislation this session. He calls SB 30 the “Curbing Nuclear Verdicts” bill and SB 39 the “Protecting Texas Trucking” bill.
The Lone Star Economic Alliance, or LSEA,—of which Texans for Lawsuit Reform, the Texas Trucking Association (TXTA) and the Texas Food and Fuel Association serve as founding members—says it “is advocating for reforms that will protect Texans from higher insurance costs; guarantee fair restitution for legitimate injuries; and create a legal environment that encourages medical providers to treat accident victims without fear of litigation abuse,” according to a news release.
Citizens Against Lawsuit Abuse, based in Austin, hired The Perryman Group, a Waco-based economic research group to do the study.
The study found that large verdicts drive up grocery, housing and insurance prices.
“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,” Mike Hachtman, chairman of Texans Against Lawsuit Abuse, said in a statement. “It’s clear, we need to rein in excessive lawsuits and massive court awards that are driving up costs consumers pay for virtually every item on the market.”
Source: https://www.law.com/texaslawyer/2025/03/31/everythings-bigger-in-texasincluding-the-cost-of-nuclear-verdicts/?slreturn=20250402-41230