Escondido city councilman on litigation costs: 'Without reform, businesses will continue to be targeted, forcing prices higher'

Mike Morasco, an Escondido City Councilman, has expressed concerns over California’s tort system, which he claims leads to increased costs and job losses for businesses. He urged lawmakers to tackle litigation abuse through meaningful reforms in an op-ed published by the Times of San Diego.

"Without reform, businesses will continue to be targeted, forcing prices higher and workers to be paid less or let go," said Morasco. "Our tort system is more impactful than most people realize, and it is high time lawmakers called out this exploitation and enacted meaningful reforms. Prop. 65 'fishing' expeditions have become a cottage industry in our state; Since 2012, filings have increased by 251% This year, Welch's settled a case for $1.5 million where the average payout to class members was $4.94, while lawyers took home $394,657."

A report from the U.S. Chamber Institute for Legal Reform estimates that California's tort system generated $72 billion in costs in 2022, translating to $5,429 per household—over $1,200 above the national average. The report suggests that legal incentives and a lack of substantial reform have contributed to heightened litigation activity within the state. It points out the influence of plaintiffs' lawyers and third-party litigation funders in shaping a system that imposes growing financial burdens on households and businesses.

According to official data from the Judicial Council of California, class action lawsuits increased by 81% between 2000 and 2005. This rise highlights a trend of mass legal filings often focused on minor or technical grievances. Legal observers attribute much of this surge to consumer-protection statutes and evolving interpretations of laws like California’s Unfair Competition Law. The Council's review indicates that this growth has significantly impacted civil court workloads, creating bottlenecks and financial burdens on defendants.

The Perryman Group's 2024 economic analysis states that California’s excessive tort costs amount to $61 billion annually, resulting in a per-resident "tort tax" of $2,458. These costs encompass not only legal fees and settlements but also broader effects such as reduced economic output and job losses. The report warns that unchecked litigation costs suppress business investment, undermine competitiveness, and shift financial burdens onto consumers and workers.

Morasco is not only a City Councilman but also a business owner in Escondido, California. His official Facebook page emphasizes his focus on fiscal policy, public safety, and economic matters. He has publicly addressed the impact of legal costs and referenced laws such as Proposition 65 and PAGA (Private Attorneys General Act).