"Lawsuit Tax" Adds a Hidden Cost
to Consumer Goods and Services

By Jon Opelt, Houston Director
Citizens Against Lawsuit Abuse
Houstonians have been burning the midnight oil this month preparing tax returns and listing deductions, but there is one thing they were unable to recover: the hundreds of dollars in hidden taxes every Texan is forced to pay because of lawsuit abuse.

At a time when residents are focused on taxes, it is time we focused attention on the "lawsuit tax" every Texan pays every time they buy a product or pay for a service.

Research indicates Texas households pay an estimated $1,200 more for goods and services each year because of lawsuits. This cost has probably been lessened due to the passage of a series of lawsuit reforms in 1995.

CALA President Cora Sue Mach attributed the "lawsuit tax" to the cost business bears in hiring lawyers, fighting lawsuits, settling cases, paying out excessive damage awards, and the myriad of defensive measures businesses take to protect themselves from being sued.

"The only way to minimize the lawsuit tax is to put an end to junk lawsuits and unwarranted awards," said Mach.

"Confidence needs to be restored in our civil justice system so that disputes are resolved based on merit rather than economic coercion," she said. "Otherwise, each and everyone of us will continue to pay these 'hidden taxes'; taxes we can never claim or reduce until the system is repaired," Mach said.

Citizens Against Lawsuit Abuse

2500 City West Boulevard, Suite 300 • Houston, Texas 77042
E-mail: sosueme@ • Administrative: (713) 267-2302 • Fax: (713) 267-2267