Baseless Lawsuits May Begin and End with California

court gavelCalifornians may not know it, but their courts are creating an unprecedented “super tort” that could be used against anyone that makes and sells a lawful product. Today, it is paint and tomorrow it could be you or your company.

In February, California’s Supreme Court surprised many experts by declining to review a high-profile case against paint and pigment makers that has been in the state’s court system since the early 2000s. In unprecedented rulings, the lower courts are making three companies pay more than a billion dollars to remove lead paint from all private homes built before 1951 across 10 California counties. The only option left for the companies is to take the case to the U.S. Supreme Court.

To some, this may not sound like a case of national importance, but it is. Lawsuits that seek to pursue businesses for money, regardless of wrongdoing, have been tried for four decades. In the past, state courts have stopped this including in Rhode Island, New Jersey and Illinois. This case is the first time a state high court has allowed this type of deep pocket jurisprudence to stand.

The legal theory is a new twist on the centuries-old tort of public nuisance. The lawsuit argues that three companies can be liable for all lead paint remaining in homes today simply because they sold paint containing lead pigment decades ago. The passage of time, the development of knowledge about specific risks and any semblance of actual causation were jettisoned from the case. Incredibly, the lower courts are requiring the companies to remove lead paint from homes even if their paints were never in those homes.

Now, lawyers representing eight California communities are pushing a similar version of public nuisance theory against energy manufacturers. In lawsuits filed last year, they allege the companies are contributing to climate change and, therefore, should be liable for any potential impacts of the global phenomenon. Even though energy products are used by every American and around the world, the lawsuits want to hold a handful of companies responsible. It may be good for politicians seeking headlines or lawyers seeking financial gain, but it won’t solve the problem. It does, however, threaten the jobs of manufacturing workers. U.S. District Court Judge William Alsup agreed that the courts are not the proper venue to address this issue and recently dismissed the complaints brought by San Francisco and Oakland.

With these public nuisance lawsuits in their infancy, along with a similar one brought by New York City, the U.S. Supreme Court should hear the case against the paint manufacturers. The Supreme Court could go a long way in halting the onslaught of baseless lawsuits cropping up across the country.

If the Supreme Court grants review, the plaintiffs may have their work cut out for them. The Court shut down similar lawsuits in the past. In American Electric Power v. Connecticut, a state-led coalition sued six power companies claiming that their emissions were a federal public nuisance. In an 8-0 decision, the Court dismissed the suit, explaining that emissions are not to be regulated by the courts. Similarly, lead paint, once its harms were known, was subject to regulation by the legislative and executive branches— not the courts. If American Electric Power v. Connecticut is any indication, Supreme Court consideration of the lead paint case may help shut the door on these baseless lawsuits.

More than one million Californians work in manufacturing and more than twelve million men and women nationally. These types of lawsuits undermine the fairness of our nation’s legal system, our manufacturing base, and our economy.

Lindsey de la Torre is Executive Director of the National Association of Manufacturers’ Manufacturers Accountability Project.

Federal Bill To Curb Shakedown Ada Lawsuits Introduced

There has been a lot of focus on what will California do this year to stop the shakedown lawsuits associated with the Americans with Disability Act (ADA). Many bipartisan bills have been introduced at the state level (including AB 52, AB 54 and SB 67), but to solve the problem we also need the federal government to take steps to stop these shakedown artists.

Well, there’s good news on that front. Congressman Ken Calvert (CA-42) and Congressman Duncan Hunter (CA-50) have re-introduced the ACCESS (ADA Compliance for Customer Entry to Stores and Services) Act – . This legislation is designed to help small businesses comply with the ADA, and stop the abusive ADA lawsuits that have hurt so many businesses in California.

“The purpose of the ADA is not to give abusive trial lawyers access to the hard earned money earned by small businesses,” said Rep. Calvert when he reintroduced the bill. “The ACCESS Act will ensure that disabled individuals continue to have access throughout our communities while protecting small businesses from abusive lawsuits. The important thing is to find ways to improve access, not fleece small business owners and jeopardize jobs.”

The ACCESS Act requires someone who wants to file a lawsuit against a business for an ADA violation provide the business owner/operator a written notice of the violation. The owner/operator would have 60 days to provide the plaintiff a description outlining the improvements that would be made to address the barrier, and then have 120 days to address the violation. If the owner/operator fails to meet any of these conditions, the lawsuit could then move forward.

CALA applauds Representatives Calvert and Hunter for reintroducing this critical legislation. A whole host of additional elected officials have signed on to H.R. 241. I hope more will join them, and that it can be a truly bipartisan effort like the ADA bills here in California.

California has over 40% of the nation’s ADA lawsuits, while having only 12% of the country’s population.  But this isn’t just a California problem. Other states like Florida, Louisiana New York and Minnesota are beginning to see more of these lawsuits. That’s why the ACCESS Act deserves to become law.

Originally published by Fox and Hounds Daily

Tom Scott is executive director, California Citizens Against Lawsuit Abuse

Report: CA Remains “Judicial Hellhole”

California is home to innovation, from advances in the movie industry to the development of the iPad. But not all innovations here are beneficial, and some of the “innovations” of California’s lawyers are nothing but attempts to get large settlements or win large verdicts.

Those innovations are one reason why California was yet again named one of the worst “Judicial Hellholes” in the nation. We’ve all heard about the crazy lawsuits against food manufacturers that are filed here in California, such as lawsuits about a footlong Subway sandwich not measuring exactly one foot. But the Judicial Hellholes report also highlights an especially troubling trend: contingency-fee lawyers prospecting on the backs of taxpayers by using “public nuisance” lawsuits to sue entire industries looking of a big payday.

For years now, California Citizens Against Lawsuit Abuse has been watching the progress of a lawsuit against paint manufacturers who in the early 1900s manufactured paint with lead-based pigments, a product specified for use on government buildings and repeatedly endorsed by federal, state, and local governments until the mid-1970s. In this case, the plaintiffs’ attorneys – who are working on a contingency fee and have profit, not public health as a motive – have creatively alleged that paint manufacturers violated the state’s public nuisance laws, creating a much lower bar for liability and thus a much easier way to make money.

Unfortunately, the judge in this case bought this absurd argument hook, line and sinker, and awarded $1.15 billion to the plaintiffs – of which 17 percent will go to the contingency fee lawyers who took this case on – nearly $200 million. And while the lawyers are laughing all the way to the bank, California’s homeowners will suffer the consequences of this decision. That’s because the decision labels all homes built before 1981 with lead paint inside them in the ten plaintiff cities and counties as “public nuisances,” – a decision that could “precipitate the worst plunge in California home values since the housing crash of 2007,” according to Giuseppe Veneziano, president of the Los Angeles County Boards of Real Estate.

There may be even more far-reaching effects. The judge’s decision in this case requires inspectors to look for evidence of lead paint in pre-1981 homes, forcing occupants to vacate their homes and relocate until safety is restored to the satisfaction of authorities. This ruling will affect 2.6 million homes in Los Angeles County alone, and an estimated 5 million homes statewide.  How long will it take to inspect all those homes? What will the effect be on the value of those homes until inspection and abatement is complete? Will there be a lasting effect on home values even after abatement takes place? These questions remain unanswered but the results could be catastrophic for California homeowners, as well as the local governments that rely on property taxes to provide services.

But those are just minor details to lawyers looking for a payday. In fact the windfall victory has encouraged other lawyers to try to cash in, too. Contingency fee lawyers have convinced two counties in California (Orange and Santa Clara) and Cook County in Illinois to sue the pharmaceutical industry using the same “public nuisance” argument regarding the use of opioid-based drugs.

These lawsuits are textbook examples of one of the biggest problems facing our lawsuit system – it mainly serves the interests of lawyers rather than ordinary people. But it doesn’t have to be this way. It’s up to all of us to take a stand against this abuse of our courts. We need to challenge our elected leaders to take a stand against these brazen attempts to get wealthy through lawsuits. After all, our court should be used to make people whole – not rich.

Originally published on Fox and Hounds Daily

Tom Scott is Executive Director, California Citizens Against Lawsuit Abuse