New York City Lawsuit Settlements: Agencies, Costs, and Causes

New York City lawsuit settlements totaled $1.94 billion across 13,397 resolved claims in fiscal year 2024, up sharply from $1.45 billion the year before.¹² That money comes out of a dedicated “Judgments and Claims” line in the city budget, which exceeds $1 billion annually and is funded by taxpayers.³ A small number of agencies and case categories account for most of the spending.

Tort Claims Versus Law Claims

City payouts fall into two buckets. Tort claims cover personal injury and property damage. Law claims cover salary disputes, contracts, and special education reimbursements. In FY 2024 the city paid $1.04 billion on tort matters and $907.83 million on law claims, with the law-claim total jumping 27.8% from the prior year.¹ Within the law-claim bucket, salary settlements accounted for 49% and special education reimbursements for 46%.

FY 2023 showed a comparable split across 13,227 resolved matters: $739.6 million in tort claims and $708.9 million in law claims.² The largest tort subcategories that year were motor vehicle ($173.7 million), civil rights ($145.4 million), police action ($93.1 million), school accidents ($70.6 million), and medical malpractice ($51.5 million).

Which Agencies Drive the Cost

Five agencies produced nearly all of the FY 2024 tort spending:¹

NYPD: $309.56 million
Department of Correction: $252.87 million
Department of Education: $128.07 million
Department of Transportation: $115.27 million
Health + Hospitals: $45.77 million

The Correction department’s number was inflated by a single $171.52 million class-action settlement over detainees held after posting bail.¹ The NYPD has consistently led the list, with $266.7 million in FY 2023 tort payouts alone.⁴

Police Misconduct and Wrongful Convictions

NYPD misconduct suits have cost more than $100 million every year since 2022. In 2025 the city paid over $117 million to resolve 1,044 misconduct cases.⁵ 2024 was worse: $206 million across 980 lawsuits, a record.⁶ The cumulative total since 2019 passes $796 million.⁷

Wrongful conviction cases are the heaviest piece. In FY 2023, 13 reversed-conviction matters cost $81.3 million, which was 56% of all civil rights payouts that year.² Roughly $42 million of the $117 million 2025 total went to wrongful conviction settlements, including $13 million to Eric Smokes and $11.1 million to David Warren, both wrongly convicted for a 1986 robbery.⁶ The NYPD has pointed out that about a third of its 2025 settlement total stemmed from cases originating more than 20 years ago.⁵ The best-known wrongful conviction settlement, $40 million to the Central Park Five, was described at the time of its approval under Mayor Bill de Blasio as the city’s largest civil rights settlement.⁸

NYPD conduct during the 2020 racial justice protests generated its own wave of payouts. The city agreed to a $13.7 million class-action settlement covering nearly 1,400 people at $9,950 each, and a separate $6 million deal for about 320 protesters “kettled” at a Bronx demonstration, who received roughly $21,000 apiece.⁹¹⁰ Hundreds of individual claims had been filed as of mid-2023, with about half resolved at a cost of nearly $12 million.

Rikers Island

Conditions at Rikers have driven corrections payouts upward for years. Personal injury claims against the Department of Correction hit $13.1 million in FY 2015, a 122% jump from FY 2009, with claim volume up 73% in just two years. Death cases from that period produced significant individual settlements, including $2.25 million for Jerome Murdough, who died in an overheated cell, and $1.25 million for Angel Ramirez, who was allegedly beaten to death by guards.¹¹

The FY 2024 Corrections total of $252.87 million was pushed up almost entirely by one case. Jones v. City of New York, filed in 2017, alleged that the city routinely held people in jail for hours or days after they had posted bail. The settlement, approved in 2023, pays $3,500 per instance of delayed release to a class estimated at 71,000 people. Early estimates put the total at $74.55 million, though some projections run as high as $300 million depending on claims filed.¹²¹³

Special Education: The Fastest-Growing Line

The single most rapidly growing category of city payouts has nothing to do with police or jails. Under federal law, the Department of Education must provide a free appropriate public education to every child with a disability. When the DOE fails to deliver mandated services, families can file for due process hearings and, if they win, force the city to reimburse private school tuition or independently arranged therapy. Spending on these reimbursements climbed from $161 million in FY 2012 to $918 million in FY 2022, and passed $1 billion in FY 2023.¹⁴ In FY 2024, special education was the single largest category of law claim payouts, with the city spending more than $1.2 billion.¹⁵

The FY 2025 budget projected $1.3 billion for these costs, and the current administration sought an additional $558 million for FY 2026 on top of $935 million already approved.¹⁶¹⁵

DOE reimbursement rates for therapy sit far below market. A 30-minute speech therapy session pays $45 while private rates reach $300 per hour, which pushes providers out of the DOE system and more families into litigation. The Comptroller’s office also found that in FY 2022, more than 90% of over 900 providers paid through due process settlements had no documented safety clearances, accreditation checks, or background screenings on file.¹⁴ Access is unequal too: in 2021 the Upper West Side logged 14.8 due process cases per 1,000 students, Queens fewer than 1, and Staten Island 0.6.¹⁶

The Gulino Teacher Certification Judgment

One of the most expensive single matters in city history is Gulino v. Board of Education, a class action alleging that the DOE used discriminatory teacher certification exams. Total projected payouts run to roughly $1.35 billion plus additional damages, scheduled through FY 2028.² The city paid $366.8 million toward the judgment in FY 2022 and $218.8 million in FY 2023, with those payments categorized as salary claims and making up the majority of that subcategory in both years.

How a Claim Becomes a Settlement

Anyone suing New York City must first file a Notice of Claim with the Comptroller’s Office within 90 days of the incident.¹⁷ After a minimum 30-day wait, claimants may be called in for a sworn interview (a 50-h hearing). If Comptroller examiners find the city responsible, they may offer a settlement, though an offer is not an admission of liability.¹⁸ If no deal is reached, a lawsuit must be filed within one year and 90 days of the incident, at which point the matter transfers from the Comptroller to the NYC Law Department.¹⁹

The Law Department runs about 800 lawyers and 750 support staff on roughly $250 million a year. Its Tort Division alone fields over 7,000 new lawsuits annually, with about 24,000 cases pending at any time.³²⁰ Under Section 394(c) of the City Charter, any litigation settlement requires the joint approval of both the Corporation Counsel and the Comptroller; neither office can act alone.²¹

Efforts to Bring the Numbers Down

The Comptroller’s annual report has repeatedly urged agencies to use claim data as a risk management tool, with specific pressure on the two biggest tort categories, vehicles and police.² A February 2023 report called “Wreckless Spending” recommended shrinking the city fleet, redesigning streets, and tightening driver accountability. The report has also pressed the NYPD to fold claim data into officer accountability and misconduct training.

The state FY 2026–27 budget added tort reforms aimed at motor vehicle litigation. New York moved from pure comparative fault to a modified version that bars recovery when a plaintiff is primarily at fault, tightened the “serious injury” definition that lets claims bypass the no-fault system, and limited payouts to drivers who were uninsured or acting illegally at the time of a crash. A separate Litigation Funding Act, passed in 2025 and amended in 2026, capped lawsuit-loan recoveries at 25% of a plaintiff’s total recovery and required those firms to register with the Department of Financial Services. Other proposals, including a Scaffold Law overhaul and a move from the fixed 9% judgment interest rate set in 1981 to a market-indexed rate, have been floated but not enacted.²²

1
Insurance Journal. NYC Claims Tracking Dashboard FY 2024
2
NYC Comptroller. Annual Claims Report
3
CityLand. The City’s Attorney: What the Corporation Counsel Does
4
NYC Comptroller. City Paid $1.45B in Settlements Last Fiscal Year
5
Queens Daily Eagle. Police Misconduct Payouts Top $100 Million for Fourth Straight Year
6
ABC7 New York. NYC Paid $117 Million in 2025 to Settle NYPD Police Misconduct Lawsuits
7
Legal Aid Society. NYPD Misconduct Cost Taxpayers $117 Million in 2025
8
PBS NewsHour. New York City Awards $40 Million to the Wrongly Imprisoned Central Park Five
9
The Guardian. New York NYPD George Floyd Protests 2020
10
NBC New York. NYC to Pay George Floyd Protesters Millions in NYPD Kettling Settlement
11
NYC Comptroller. ClaimStat: Rikers Island
12
Prison Legal News. Nearly $75 Million Class Action Settlement Reached for Delayed Releases From NYC Jails
13
Civil Rights Litigation Clearinghouse. Jones v. City of New York
14
NYC Comptroller. Course Correction
15
Families for New York. NYC Special Education: A Billion Dollar Problem
16
New York Post. A De Blasio-Era Special Ed Policy Is Killing NYC’s Budget
17
NYC Comptroller. Filing a Claim With the New York City Comptroller
18
NYC Comptroller. Personal Injury Claim FAQs
19
NYC Comptroller. Property Damage Claim FAQs
20
NYC Law Department. Tort Division
21
NYC Charter. Chapter 17
22
Empire Center. New York at the Crossroads: Will It Modernize Liability Law or Expand It