New Study: Lawsuits Against Louisiana Municipalities Cost More Than $52 Million
BATON ROUGE, LA – Lawsuits against Louisiana’s cities and parishes are numerous – and very expensive, a new study released today by the non-partisan, legal watchdog group Louisiana Lawsuit Abuse Watch (LLAW) shows. An analysis of just eight Louisiana municipalities identified more than $52 million spent on lawsuits against local governments, including settlements, verdicts and outside counsel from 2006- 2009.
To assess the extent of litigation impact on Louisiana’s municipalities and municipal budgets, LLAW surveyed eight of the largest cities and parishes in Louisiana, and found these staggering results:
$13 Million in Average Annual Municipal Lawsuit Costs: From 2006-2009, Alexandria, Baton Rouge, Lafayette, Lake Charles, Monroe, New Orleans, Shreveport and Terrebonne spent $37 million in verdicts and settlements and $14.9 million in payments to outside counsel. The average total is more than $13 million per year for the eight municipalities combined. For all Louisiana municipalities, the annual litigation cost is estimated to be nearly $24 million.
Increasing Municipal Lawsuits: For the nearly 3,000 lawsuits filed against the group of municipalities during the period, the number of suits per year increased from 706 in 2006 to 814 in 2009 – an increase of 15 percent over the period. The average number of lawsuits for the jurisdictions was 88 in 2006 and 102 in 2009.
Louisiana Households Pay a “Lawsuit Tax”: On average, municipal litigation costs per household were more than $88 over the time period studied.
“This report sheds light on a growing problem that has gone largely unnoticed in Louisiana,” said LLAW Executive Director Melissa Landry. “At a time of deep recession, when state and local governments are going through unprecedented budget hardships, our municipalities are spending tens of millions of dollars defending against lawsuits and paying settlements.
“These costs to government are an unproductive use of taxpayer dollars. Our municipalities would be better off using our precious tax dollars on much-needed public services such as education, law enforcement, health care and road repairs.”
Had the millions spent on litigation costs been available for other, more worthwhile projects, Louisiana municipalities could have been able to:
Hire More Police: In Baton Rouge, where crime is a major problem, the $10.2 million spent on litigation from 2006-2009 could have been used to hire roughly 80 new police officers over the same four-year period.
Hire More Teachers: In New Orleans, the $14.1 million could have paid the salaries of 72 more teachers.
Hire More Firefighters: In Lafayette, the $6.7 million could have been used to pay salary and benefits for 30 additional fire fighters.
“This report also reveals that Louisiana’s growing municipal litigation costs far exceed those that our neighbors pay,” Landry continued. “For example, Baton Rouge has paid out nearly three times as much as Austin in ‘lawsuit taxes’ over the last several years. Austin has nearly twice the population, yet they are paying much, much less.
“On a per-household basis, when comparing just verdicts and settlements in Baton Rouge between 2011-2009 the amount is more than five times that of Austin, nearly $47 in our capitol as compared to slightly more than $9 in the Texas capital. Moreover, verdicts and settlements per-household are even higher for New Orleans, Terrebonne, Lafayette and Lake Charles.
“These numbers clearly demonstrate that there is a growing problem in Louisiana, and we can and must do more to stop it. While some lawsuits have merit, many do not. We cannot afford to keep paying millions of dollars in litigation costs while so many of our public institutions are losing their funding. Lawsuits are meant to provide justice for those who have been truly wronged, not a windfall for a handful of plaintiffs and their attorneys.”
Read the complete report.
The release of this report is part of LLAW’s long-term public education campaign to increase public awareness about the widespread costs of lawsuit abuse in Louisiana.