New York City Comptroller Brad Lander released the Annual Claims Report, summarizing claims filed against or settled by the City during fiscal year 2022.
In FY 2022, 12,188 claims and lawsuits against New York City cost $1.5 billion—the highest annual amount in the city’s history. The increase from FY21 is largely due to the Gulino class action lawsuit, filed in 1996 for discrimination by the City as a result a State-mandated teacher certification examinations. Of the top 11 largest individual claims settled by the City in FY 2022, seven were for wrongful convictions.
“Of the eleven largest individual tort claim settlements against the City last year, seven were for wrongful convictions, two for medical malpractice, one for an assault at Rikers Island, and an accident involving a science experiment at a public school. We’d so much rather spend the $1.5 billion we spent on claims this year to improve our schools, parks, and neighborhoods. The Annual Claims Report can serve as a tool to identify and mitigate risks, reduce harms to New Yorkers, and improve the City’s bottom line,” said Comptroller Brad Lander.
Personal injury and property damage claims (collectively, “tort claims”) payouts cost the City $688.4 million, up from the $583.0 million spent in FY 2021, an 18% increase. The five costliest types of tort claim settlements in FY 2022 were civil rights, motor vehicle crashes (explored in detail over the past decade in the Comptroller’s recent Wreckless Spending report), police action, accidents in schools, and medical malpractice claims. Together, these five claim types cost $482.7 million and accounted for 71% of all personal injury claim settlements in FY 2022.
Salary Claims Account for Largest Share of Law Settlements
In FY 2022, the City paid out $819.2 million in law claims, a 117% increase from the $377.0 million paid out in FY 2021. Salary claims represent more than half the cost of all law claims. Total salary claim payouts increased dramatically from $18 million in FY 2021 to $437.5 million in FY 2022, primarily due to judgments in Gulino v. Board of Education.
The Gulino v. Board of Education class action lawsuit was filed in 1996 and alleged that two of the Department of Education (DOE) mandated teacher certification examinations had a disparate impact on Black and Latino teachers. After years of litigation courts decided that use of the examinations as part of the selection process for teachers violated Title VII because the examinations had a disparate impact on Black and Hispanic test takers and there was a lack of proof that the examinations were a valid device for selecting teachers. Ultimately, the DOE was required to pay backpay and other damages and costs, resulting in payments of $366.8 million in FY 2022.
Excluding judgments on that lawsuit, payouts on salary claims still increased by 293%. This increase is due to several other multimillion-dollar payments, including two eight-figure collective action settlements alleging violations of the Fair Labor Standards Act. Excluding Gulino v. Board of Education, the cost of salary claim payouts increased by $52.7 million, from $18.0 million in FY 2021 to $70.8 million in FY 2022.
Wrongful Conviction Settlements Account for Largest Share of Tort Settlements
For the first time since FY 2017, City payouts on tort claims rose in part due to the 17% rise in civil rights claims. The cost of civil rights claim payouts increased to $143.2 million in FY 2022 up from $95.2 million in FY 2021.
Some of the highest tort claim payouts were 16 wrongful conviction claims that settled for an average of $5.43 million each, costing the City a total of $86.8 million in payouts. Six of these settlements were settled by the Bureau of Labor Law pre-litigation and cost the city $25 million. Pre-litigation settlements ensure prompt relief for claimants and help both the City and claimants avoid costly legal fees.
Under the New York City Charter, the Comptroller has the power to settle or adjust all claims against or on behalf of the City. This work is performed by the Comptroller’s Office Bureau of Law and Adjustment (BLA), which, under the direction of the Comptroller, the General Counsel, and the Assistant Comptroller for BLA, comprises attorneys, claims professionals, engineers, and administrative staff.
The full Annual Claims Report for Fiscal Year 2022 can be read here.
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