A new report released by a group pushing for tort reform has outlined the costs of lawsuits associated with some of California’s local government. The 17 cities and counties included in the study a massed more than $1.09 billion in settlements and fees from lawsuits in just four years.
In addition to the now infamous settlement that pushed Mammoth Lakes into bankruptcy, the report outlines several other settlements with significant implications to local budgets. In one case from Half Moon Bay, the CALA reports that the City settled a case for $16 million – nearly double the City’s annual budget. The size of the settlement nearly caused the city disincorporate. Instead of folding, they say, the City issued $16 million in bonds and won a settlement from their insurance company.
While the $16 million settlement was a pittance in the overall $1.09 billion price tag, other cities and counties accounted for large portions of the billion dollars. Los Angeles County, for instance, spent $213 million on verdicts and settlements during the four years, and $146 million for outside legal services, the City of Los Angeles spent another $221 million on settlements and $59 million for legal services; bringing the combined totals for Los Angeles to $434 million and $205 million for settlements and services respectively. San Francisco paid $117 million in settlements and $6 million for legal services.
“[The] report examines the cost of verdicts, settlements and outside counsel to some of California’s largest cities and counties,” reads the CALA Report. “It does not take into account the cost of in-house counsel and other administrative costs associated with the enormous number of lawsuits facing cities and counties.
“While this report does not present an exhaustive accounting of the cost of litigation to cities and counties in California, the data it contains make one point exceedingly clear: it is unacceptable for cities and counties to continue paying out-of-control legal costs while vital social service and public safety programs face budget cuts.”
The report also highlights some extremes that local governments have gone to avoid further lawsuits. In Yuba City, a man was awarded a $15,000 settlement in exchange for his promise not to file any more ADA lawsuits against the City or its businesses. He had been filing ADA Compliance lawsuits for various “minor” infractions which one local businessman called “extortion.”
Review the full report here.