California’s Lawsuit Industry Is Driving Businesses Away
6th October 2026
When it was reported that Paramount is considering leaving California, many politicians looked for ways to keep one of the largest moviemakers in Hollywood. But few looked for reasons why employers are packing their bags in the first place.
Chevron, Tesla, Oracle, and more Fortune 500 companies have already left for other states. And all cited an unfriendly business environment.
High taxes and onerous regulation are big parts of that story, but California’s legal environment has also chased big taxpayers out of the state.
The Golden State is a troubling example of what happens when workplace litigation becomes an industry unto itself. From the beginning of this year through August, nearly 2,000 California workplace disputes reportedly settled for a combined $1.63 billion. Some undoubtedly involved workers who had been genuinely wronged and were entitled to compensation.
But over the years, an enormous cottage industry has grown from workplace lawsuits and employment claims, in part because many employers acknowledge that even claims with some merit can cost enormous sums to defend.
Sometimes paying a settlement is simply cheaper than proving you did nothing wrong.
“Sue and settle” has been a guaranteed money-maker for trouble-makers for too long.