Bobby Jenkins, CEO of ABC Home & Commercial Services, expressed concerns about the impact of frivolous and fraudulent lawsuits on Texas businesses. He said that these legal actions increase costs, restrict growth and hiring, and impose a hidden "lawsuit tax" of approximately $1,700 per household annually.
"For service industry businesses like ours, margins are razor thin. So, the money some people are collecting for settling their frivolous or even fraudulent lawsuits is the same money that comes out of the pockets of our customers and employees," said Jenkins, President and CEO. "We all pay for the cost of lawsuits, win or lose and whether we're involved in a lawsuit or not. Lawsuit abuse can squelch a business' plans to expand, hire new employees or deliver pay raises. As consumers, we pay more for products and services, including for liability insurance. For Texans, this ‘lawsuit tax' is about $1,700 on average every year for each of us, well above the national average. We desperately need reforms to limit the ability of unscrupulous personal injury lawyers to shake down small businesses and make a windfall. Access to courts for legitimate lawsuits must be preserved, but today's get-rich-quick lawsuit environment must be stopped. Let's hope the Legislature agrees and acts."
According to Jenkins in a blog post, abusive lawsuits harm small businesses across Texas. Personal injury lawyers target service companies with baseless claims, often driven by aggressive advertising and misleading tactics. These lawsuits, even when unfounded, impose significant financial burdens on businesses, leading to higher consumer prices and stifling business growth and employment opportunities. Jenkins said that every Texan effectively pays an annual "lawsuit tax" due to inflated liability costs and described the state's legal system as being exploited by a "lawsuit lottery" culture.
A study from the U.S. Chamber Institute for Legal Reform found that Texas ranks among the top five states for nuclear verdicts. Between 2013 and 2022, 130 personal injury and wrongful death cases resulted in $16 billion in awards. The study highlighted how "anchoring" tactics—where attorneys suggest arbitrary high-dollar damage amounts—contributed significantly to inflating jury awards. An example cited involved a $39 million verdict in an auto accident case after a plaintiff’s lawyer proposed a symbolic per-mile damage figure; the Texas Supreme Court later overturned it due to improper tactics. These excessive awards contribute to higher insurance premiums and consumer costs while undermining fairness in the legal system.
The American Tort Reform Association (ATRA) reported that Texas is a major hub for legal services advertising. Dallas and Houston rank among the top ten U.S. media markets for total spending on these ads in 2024. Dallas saw approximately $69.8 million spent on 622,212 ads, while Houston accounted for over $56.6 million spent on more than 411,000 ads. These figures reflect a broader national surge in trial lawyer advertising, which reached $2.5 billion across the U.S. last year—more than double what pizza restaurants spent.
The American Property Casualty Insurance Association (APCIA) and Munich Re US released a survey indicating that most Americans believe certain plaintiff lawyer tactics contribute to rising insurance and consumer goods costs. The Harris Poll conducted among over 2,000 U.S. adults revealed that 69% think third-party litigation funding (TPLF) and jury anchoring increase insurance costs, while 66% say these practices raise prices of everyday items. Additionally, 77% agree that allowing foreign investors to participate in TPLF could pose a national security threat.
Jenkins is also noted as the owner of ABC Home & Commercial Services—a family-owned business with over 900 employees across multiple Texas cities offering residential and commercial services—and has held leadership roles in various civic organizations.