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.

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