But looking at the extent of lawsuit abuse in California, it’s not surprising CEOs would rank this state as having the most difficult environment to conduct business.This morning I attended a breakfast meeting hosted by California Citizens Against Lawsuit Abuse (CALA), the National Federation of Independent Business (NFIB) in California, and the Citrus Heights Regional Chamber of Commerce. Tom Scott, executive director of California Citizens Against Lawsuit Abuse, gave an update on the worst trends in lawsuit abuse against small businesses.
After citing some statistics about the disproportionate amount and stunning costs of lawsuits filed in California (both against private businesses AND public agencies), Mr. Scott focused on the statutory authorization of “private right of action” to enforce laws, in particular the federal Americans with Disabilities Act (ADA) and the associated state accessibility laws for disabled citizens. As you can see if you go to the links, trying to get a systematic understanding of these laws is a formidable task.
For ten years, Northern California news media and business groups have followed the legal activities of Scott Johnson, a disabled lawyer with a firm based in Carmichael (near Sacramento) called Disabled Access Prevents Injury, Inc. He routinely sues small business owners or threatens to sue them for non-compliance with accessibility laws unless they pay a settlement.
If you peruse the numerous news articles on these cases, you’ll see that many of the targeted small businesses were indeed out of compliance: some because of ignorance, some because of confusion over the interpretation of the law, and some because full ADA compliance would be absurdly costly. Some business owners claim they have been forced to close their operations because of the legal threats. In other cases, the businesses claim the charges are false and unsubstantiated.
Pressure from business groups to address this abuse increased when Mr. Johnson began targeting small businesses operating out of older buildings in economically-struggling rural areas of the Sierra Nevada mountains. Waves of litigation threats have hit numerous mom-and-pop businesses in small rural communities such as Pollock Pines and Foresthill.
According to Mr. Scott, public outrage against these legal tactics reached “the tipping point” in July 2009 after the highly publicized decision of the owner of the Squeeze Inn burger joint in Sacramento to stop squeezing his customers into his cramped long-established location. The owner had been sued by Jason Singleton, another lawyer who frequently takes legal action against small businesses that are not compliant with accessibility laws.
I found a concise June 2011 presentation on the web of an attorney I don’t know (Marc B. Koenigsberg of the law firm Greenberg Traurig, LLP in Sacramento) entitled “Avoiding Disability Access Lawsuits.” He dared to include a list (on page eight) of six Northern California attorneys notorious for legal actions for accessibility. He’s only scratching the surface.
In Southern California, a Los Angeles lawyer named Morse Mehrban who specializes in ADA lawsuits reportedly sued two businesses in March 2012 after employees there refused to allow a disabled man named José Estrada to bring his miniature pony (named “Princess”) inside. I was not able to find a copy of the actual lawsuit on the web (to confirm this bizarre only-in-California story is not an urban legend), but it is true that federal regulations authorize dogs and miniature horses to be service animals for the disabled: see here. Business owners: please make a note of the following federal regulation, from the September 15, 2010 Federal Register:
And another commenter responds with words good enough to be the title of this post:
Let us remember who Democrats and liberals value more. Not CEOs, not small business owners. No, they value ambulance chasing lawyers.