A new Forbes report (hat tip: Overlawyered) has some pretty shocking statistics about how much money New York City spends on lawsuits:

New York City spends more money on lawsuits than the next five largest American cities—Los Angeles, Chicago, Houston, Phoenix and Philadelphia—combined.

The city’s $568 million outlay in fiscal year 2008 was more than double what it spent 15 years ago and 20 times what it paid in 1977. New York now allocates more taxpayer dollars to settling personal-injury lawsuits than it does to parks, transportation, homeless services or the City University system.

There are some New York plaintiff’s lawyers that are getting the job done.

I don’t want to risk the ire of the plaintiff’s bar, but couldn’t they give the city a little bit of a discount given the collapse of the financial markets and the global economic recession? The first rule of parasitic symbiotic behavior is to avoid killing off the host.

Just kidding. There’s no need to blame lawyers when there are so many New York State politicians running around that we can blame.

More details after the jump.

Leave it to New York State legislators to adopt a hypocritical standard if it is in their own best interests:

Why is Gotham such a litigation target? Blame New York State’s laws, which have made the city a gold mine for personal-injury lawyers. While many states restrict lawsuits against municipalities to state claims courts, which are overseen by only a judge and tend to restrain damages, New York allows citizens to sue municipalities in jury trials. The New York State Legislature has also periodically blocked bills that would create a special court of claims for municipal cases—though the state hypocritically enjoys the low-cost benefits of a claims court for lawsuits filed against it.

This seems like an easy fix. Citizens of New York City, marshaled under the leadership of an effective and popular mayor, could exert political pressure to change this law. As long as the people are not fractured by a contentious tort reform debate we can … oh no:

Tort reform would benefit not just private victims of trial-lawyer shakedowns but the city as well. A good start would be to place caps on noneconomic damages, such as pain and suffering, as two-thirds of states have done. In Texas, for instance, lawmakers recently imposed a $250,000 cap on noneconomic damages, which not only resulted in dramatically reduced malpractice-insurance premiums for doctors, but also cut the number of all tort lawsuits in half and doubled the number of doctors applying to practice medicine there. California has long capped such damages at $250,000 in medical-malpractice cases.

Many states have also abolished or limited joint and several liability, which skews responsibility for damages toward the party with the greatest ability to pay, regardless of wrongdoing. Following suit would help New York level the playing field with those other states and protect the city from absurd litigation as well. But perhaps the single most effective action would be to establish a court of claims for municipal cases to restrain outsize judgments.

Well there’s hardly any point in slipping and falling on a city street if you can’t go after the deep pockets. Why even bother walking anymore?

Lawsuit abuse benefits the very few at the expense of the many. Reforming New York’s culture of lawsuit abuse won’t happen overnight or without a fight—especially with so many state lawmakers committed to moving counter to national tort-reform trends. But as former Indianapolis Mayor Steve Goldsmith says wryly of New York: “If you can get criminals under control, surely you can get lawyers under control.”

That’s not even helpful. The personal injury bar may be a lot of things, but they’re not “criminals.” People get hurt, sometimes because of the gross negligence of another party. and in those cases there is a fair argument that they are entitled to money.

Who gets to decide how much money? Well, it probably shouldn’t be a business man. Or a mayor. But what about a court? A special court specifically designed to balance the needs of few against the needs of the many.

I’m going to call up my local state senator right now and ask her to … oh, I forgot. I live in New York State and my elected state officials are useless.

The Big Apple’s half-billion-dollar tort tax dwarfs that of other cities. [Forbes]
John Avlon, “Sue City” [Overlawyered]