What happened: A profit-driven model of litigation—fueled by contingency fees, third-party investors and nuclear verdicts—is distorting the civil justice system and ultimately imposing a considerable tort tax on all hardworking Americans. 

By the numbers:

• The U.S. Chamber of Commerce Institute for Legal Reform estimates that lawsuit abuse adds nearly $5,000 per year to the average American family’s expenses.

• Texas had the fourth-highest number of nuclear verdicts (awards exceeding $10 million) in the country between 2013 and 2022, with more than 130 such judgments.

• Legal system abuse costs the U.S. economy approximately $529 billion annually, roughly 2 percent of the country’s GDP.

• Tort costs are rising at an alarming 7.1 percent per year, outpacing inflation.

• In Florida, legal reforms led to a nearly 24% drop in insurance-related lawsuits over two years.

TLR Thoughts: Legal system abuse doesn’t just hurt defendants—the corrupt behavior of certain personal injury attorneys drives up prices, erodes public trust and weakens our economy. In Texas, TLR continues to advocate for meaningful reforms that will help curb the proliferation of meritless and excessive lawsuits, maintain a predictable and affordable insurance market for all, and restore fairness and transparency to Texas’s courts.

Read the full article here.

What happened: Delaware’s long-standing dominance as the go-to state for corporate litigation is facing growing competition, as Texas, Oklahoma and Nevada move to attract businesses with new courts and more predictable legal environments. 

Tell me more: Frustration with recent Delaware court decisions and rising uncertainty around shareholder litigation has prompted several high-profile companies to relocate their incorporation to more pro-business states. 

What about Texas: Texas has already opened its specialized business court and enacted TLR-backed, bipartisan legislation that raises the threshold for filing shareholder derivative lawsuits, limits certain shareholder records requests and provides greater legal protections for corporate officers and boards.

TLR Thoughts: TLR is proud to support legislation that ensures Texas remains the best place in the country to do business. The reforms adopted during the 89th Texas Legislative Session are part of a long-term, strategic effort to make Texas the preferred home for companies that value legal clarity and a fair and efficient civil justice system.

Read the full article here.

What happened: Texas passed a landmark set of reforms during the 2025 Texas Legislative Session that will boost business confidence and help bring down costs. Critically, these bipartisan reforms will promote strong corporate leadership, combat shareholder proxy abuses and prohibit taxation on securities transactions.

Remind me: For more than two decades, America has seen a sharp decline in publicly traded companies thanks to rising costs, regulatory overreach and a lack of transparency. Texas is helping to restore a truly pro-business system.

In his words: “There’s a reason that Abbott calls Texas an ‘economic juggernaut.’ Companies across the world are realizing all that our great state has to offer.” – James Lee, founder and CEO of TXSE Group Inc. 

TLR Thoughts: The pro-business reforms passed in Texas this session are a major victory for the state. Texas didn’t gain its reputation as a powerhouse for job creation, innovation and growth by accident—it’s the result of decades of principled leadership and smart policy choices, in part embracing tort reform more than 30 years ago. 

Read the full article here.

What happened: On June 20, Gov. Abbott signed into law more than 300 bills passed during the 89th Regular Legislative Session, advancing policies that reinforce Texas’s reputation as a national leader in economic opportunity and limited government.

Worth noting: Among the newly signed laws are two reforms championed by TLR through the Coalition for Regulatory Efficiency and Reform:

• HB 11: Reduces barriers for skilled professionals moving to Texas by directing state licensing agencies to pursue reciprocity agreements—cutting red tape and helping new residents get to work faster.
• HB 12: Strengthens Texas’s Sunset review process to identify and address problematic regulations earlier and more often. It incorporates efficiency audits into the process and ensures regulations are tied to key agency deliverables.

TLR Thoughts: Modernizing Texas’s regulatory system is vital to supporting continued economic growth in the state. With the passage and enactment of HB 11 and HB 12, Texas is leading the way as the blueprint for America’s future.

Read the full press release here.

What happened: Legal payouts by the City of Los Angeles have skyrocketed, hitting $289 million in 2024—contributing to a major budget shortfall and prompting calls for reform. By contrast, two years earlier, Los Angeles paid just $91.3 million in legal settlements and jury verdicts.

Tell me more: A sharp rise in high-dollar “nuclear verdicts,” aging infrastructure and a growing number of lawsuits are fueling the crisis. Legal costs are now so severe that city services are being cut to cover the mounting liability.

TLR Thoughts: The Los Angeles budget crisis offers a harrowing warning to Texas lawmakers. When unchecked litigation, aging infrastructure and a lack of sensible tort reform collide, the consequences can be dire. The dramatic rise in lawsuit abuse and “nuclear verdicts” is draining Los Angeles taxpayer dollars, forcing budget cuts and diverting resources away from public services. TLR will continue to advocate for policies that preserve balance, promote fairness and keep Texas from following California’s costly path.

Read the full article here.

What happened: A new poll released by Protecting American Consumers Together (PACT) underscores the strong, bipartisan support that exists among registered California voters for lawsuit abuse reform to help address the state’s affordability crisis. 

By the numbers:

• 90% say their cost of living has increased over the past year.
• 72% identify lawsuit abuse as a key driver of rising household costs.
• 83% want the Legislature to enact reforms to eliminate the estimated $5,500 “hidden tax” lawsuit abuse imposes on California families.
• 86% believe their legislators should prioritize stopping lawsuit abuse over protecting personal injury lawyers.

TLR Thoughts: The data is clear: Americans overwhelmingly recognize the link between lawsuit abuse and higher costs of living, and they want reform. While this survey focuses on California, other states also recognize the critical need for meaningful reform—including Texas. Without commonsense legal reforms, families and job creators alike face rising costs driven by an abusive legal system. TLR remains committed to advancing reforms that protect Texas consumers and promote fairness and transparency in our courts.

Read the full article here.

What happened: Gov. Greg Abbott has signed into law HB 11, legislation that will help alleviate the incredible burden that licensed professionals face when they move to the Lone Star State. 

Remind me: Texas has one of the most burdensome occupational licensing systems in the country, with 858 license types reported in 2024. 

• Notably, licensed professionals moving to Texas often face duplicative, expensive and time-consuming licensing requirements, delaying their ability to quickly get to work and contribute to the economy. 

Why it matters: The reforms included in HB 11 will help break down unnecessary regulatory barriers, allowing qualified professionals to work more quickly and to meet Texas’ growing workforce demands. 

TLR Thoughts: TLR was proud to support HB 11 this session through the Coalition for Regulatory Efficiency and Reform. Modernizing licensing requirements will help unlock greater economic opportunity throughout the state, and signal that Texas “values talent over regulations and bureaucracy.”

Read the full article here.

What happened: During the 89th Texas legislative session, lawmakers passed some of the most impactful and beneficial changes to Texas corporate law in history. 

Tell me more: 

• TLR-supported SB 29 codifies the business judgment rule, preventing wholly inappropriate derivative lawsuits aimed at imposing social or political outcomes on businesses.
• TLR-supported HB 40 further positions the Texas Business Court as the strongest competitor to Delaware’s Chancery Court, offering businesses greater legal clarity and corporate efficiency.

TLR Thoughts: SB 29 and HB 40 are critical, pro-business reforms adopted this session, helping to make Texas “the premier geographic location on the planet to create, grow, build, or maintain a business.”

Read the full article here.

What happened: U.S. Sen. Thom Tillis (R-NC) and U.S. Rep. Kevin Hern (R-OK) have introduced a proposal to close a tax loophole that allows foreign litigation funders to avoid paying taxes on proceeds from lawsuits against U.S. companies.

Tell me more: Third-party litigation funding has surged as global investment funds pour billions into U.S. lawsuits, often with questionable merit, seeking high returns from massive settlements or jury awards. 

By the numbers: In 2023, 39 investors committed approximately $15.2 billion to commercial litigation in the U.S.

• Litigation funders see average annual returns of 25%, fueled by large settlements and jackpot jury verdicts.
• Foreign investors currently pay zero U.S. taxes on lawsuit proceeds, since those earnings are treated as capital gains and exempt under current tax law.
• The average American household bore $4,200 in litigation-related costs in 2022, according to the U.S. Chamber of Commerce.
• The Tillis-Hern proposal would tax all litigation funders—foreign and domestic—at the ordinary income rate of 37%, plus a 3.8% surcharge, closing the existing loophole.

TLR Thoughts: The loophole in the tax code benefits entities that fuel costly, abusive litigation rather than investing in innovation and job creation. The Tillis-Hern provision preserves access to the courts for legitimate claims while ending unfair tax advantages that encourage predatory lawsuits and undermine U.S. businesses.

Read the full article here.

What happened: Texas lawmakers approved SB 293, a 25% pay raise for state judges—the first increase in 12 years—on the final day of the legislative session.

Why it matters: Texas ranks near the bottom nationally in judicial pay, making it harder to attract experienced, well-qualified candidates. 

• SB 293 also addresses long-standing concerns about linking judge salaries to lawmaker pensions by shifting oversight of future legislative pensions to the Texas Ethics Commission.

TLR Thoughts: Ensuring Texas has a strong, capable judiciary starts with attracting top legal talent—and fair, competitive compensation plays a major role. TLR strongly supported this reform because it will help expand and improve the pool of candidates seeking to serve, ultimately strengthening the quality of Texas’s judiciary and public trust in our courts.

Read the full article here.

What happened: An alliance between personal injury lawyers and certain medical providers has driven a surge in nuclear verdicts across Texas, inflicting serious harm on small businesses. 

Tell me more: In 2023, nuclear verdicts of $10 million or more reached a 15-year high. 

• Some cases, like a 2018 fender-bender in Upshur County, resulted in awards exceeding $100 million, fueled by exaggerated medical treatments from doctors tied to the plaintiff’s legal team. 
• These verdicts not only distort justice but raise insurance costs and pressure businesses to scale back, relocate or shut down.

TLR Thoughts: While many nuclear verdict cases relate to very serious injuries, the increase in the number and amount of these verdicts is distorting Texas’s legal system and discouraging allocation of capital to Texas. These awards are economically unsustainable. This session, TLR – alongside a coalition comprised of more than 1,200 Texas businesses, associations and individuals – urged meaningful reforms in SB 30 and SB 39, to prevent judicial actions that are distorting Texas’s litigation environment and yielding both nuclear verdicts and excessive verdicts in run-of-the mill cases. Although the legislation did not pass this year, legislative action remains vital for the health of Texas job creators and for the Texas families who are hit with skyrocketing costs due to these abusive lawsuits. TLR is calling on the Texas Legislature to prioritize this issue in the 90th Texas Legislative Session.

Read the full article here.

What happened: Texas continues to position itself as a major player in the financial sector, competing with financial hubs like New York and Delaware. Notably, on May 14, Governor Greg Abbott signed into law three pro-business bills. These legislative victories come as the Texas Stock Exchange prepares to launch trading in early 2026. 

Worth noting: One of the three pieces of legislation enacted by Gov. Abbott is TLR-supported Senate Bill 29 by Sen. Bryan Hughes and Rep. Morgan Meyer. The new law, effective immediately, enhances legal protections for companies and limits shareholder lawsuits, aligning with broader efforts to make Texas more attractive for corporate registrations. 

• Meanwhile, a proposed constitutional amendment on the November ballot would ban taxes on securities transactions, directly countering efforts in New York to reinstate a stock sales tax. 
• These steps reflect a coordinated strategy to make Texas the top destination for business incorporation and capital markets activity.

In his own words: “Texas is going in direct competition with Delaware and New York, Delaware for registrations and New York for listings and the exchange operators.” — Jim Lee, founder of the Texas Stock Exchange

TLR Thoughts: Texas continues to distinguish itself as a national leader, leading the charge in establishing a favorable climate for businesses to flourish, ultimately boosting job growth and innovation. By reducing litigation risk and rejecting burdensome financial transaction taxes, the Lone Star State is sending a clear message: Texas is open for business. 

Read the full article here.