New Report: Economic Impact of Lawsuit Abuse
FOR IMMEDIATE RELEASE
February 6, 2026
CONTACT:
Victor Gomez
(WASHINGTON, DC) – Today, Citizens Against Lawsuit Abuse (CALA) released its latest Economic Impact of Lawsuit Abuse report, revealing that the cost of excessive litigation in the United States continues to rise, placing a growing burden on American families, workers, and the broader economy.
While America’s civil justice system plays a vital role in resolving disputes, compensating those who have been legitimately harmed, and deterring irresponsible behavior, the system can become imbalanced. When that happens, excessive tort costs, unpredictable outcomes, and massive awards begin to distort economic decision-making and divert resources away from productive uses.
The latest analysis, conducted by The Perryman Group, finds that excessive tort costs continue to impose a staggering economic burden on American families.
The Economic Impact of Excessive Tort Costs (2025)
$397.2 billion in annual direct tort costs
$602.3 billion in lost economic output (gross product)
More than 5.05 million jobs lost
$111.4 billion in annual federal revenues
$31.1 billion in annual state revenues
$26.0 billion in annual local government revenues
These costs translate into a hidden “tort tax” of $1,771 per person, or $5,579 per family, every year, raising prices on everyday goods and services while suppressing wages.
America’s civil justice system has always been structured to provide fair remedies and promote responsible behavior, not to be punitive, excessive, or unpredictable. When baseless litigation drives exorbitant damages or an explosion in awards, the result is a misallocation of scarce economic and human resources that weakens economic growth and job creation.
All major industry sectors are affected, with particularly severe impacts felt in retail trade, business services, health services, and other service industries, which experience some of the greatest losses under excessive tort burdens.
Importantly, the report also highlights a clear path forward to help solve the national lawsuit abuse crisis.
States that have enacted tort reforms to restore balance to their civil justice systems have seen improved judicial efficiency and increased economic performance over the years. These reforms preserve access to justice for those who are legitimately harmed while reducing excess costs that weigh down families and employers.
A fair and balanced legal system should promote accountability, impartial justice, and economic prosperity, not enrich the trial bar at the expense of working Americans.
The full report is available through Citizens Against Lawsuit Abuse and provides a comprehensive analysis of the economic and consumer impacts of lawsuit abuse in the United States.
###
About Citizens Against Lawsuit Abuse (CALA)
Citizens Against Lawsuit Abuse (CALA) is a nonpartisan, grassroots movement working to end rampant lawsuit abuse across the United States. CALA advocates for commonsense legal reform measures by educating the public about the devastating, real-world costs of lawsuit abuse on working families and small businesses.
About The Perryman Group (TPG)
An economic and financial analysis firm, The Perryman Group (TPG), provides clients with well-documented, carefully considered answers to even the most complex questions. For more than 30 years, The Perryman Group has met the challenges of thousands of clients through a systematic approach and a level of performance that assures a consistent standard of excellence. The firm has been involved in scores of major events shaping the economic landscape, from crucial corporate locations to landmark legislation to important regulatory policies to notable judicial decisions.