California tort-reform supporters marked Lawsuit Abuse Awareness Week with concern and disappointment about the pace of reforming the state’s civil litigation climate while pointing to high-profile fraud allegations against the plaintiff’s bar.
Lawsuit Abuse Awareness Week, which occurs during the first week of October, comes amid warnings expressed by groups such as the Civil Justice Association of California (CJAC) and California Citizens Against Lawsuit Abuse (CALA) about the costs of excessive litigation borne by consumers in the state.
CJAC is also raising concerns about law firms engaging in wholesale fraud. Such allegations unfolded in the past week against the DTLA Law Group in Los Angeles, which was the topic of a Los Angeles Times article questioning its legal practices. The firm allegedly paid former residents of a foster care facility to file bogus sexual abuse claims against Los Angeles County.
“We’re seeing the consequences of a system with too little oversight and too many incentives for abuse,” Kyla Cristoffersen Powell, CJAC’s president and CEO, told the Southern California Record in an email. “Yet more fraud allegations against the plaintiffs bar – this one involving a downtown Los Angeles law firm – underscore how deeply the problem runs and how urgently we need reform.”
California is among the most litigious states in the country, according to Christoffersen Powell, and state lawmakers continue to pass bills that expand liability opportunities – a practice that causes consumers to pay more for goods, services and insurance.
“We have solutions to provide meaningful tort reform, but we’re missing the political will in the Legislature to stand up for consumers and against powerful plaintiffs attorneys,” she said. “Until that changes, Californians will keep footing the bill for a broken system that rewards lawsuit abuse over accountability.”
In response to the DTLA Law Group allegations, Geoff Wells, president of Consumer Attorneys of California, an organization representing trial attorneys, urged the State Bar of California to launch a thorough investigation of the firm.
“This is not a matter that can wait,” Wells said in a prepared statement. “Illegal ‘capping’ and ‘running’ – generating lawsuits by paying intermediaries to drive claimants to a particular attorney or firm – are corrosive practices explicitly prohibited under California law.”
Victor Gomez, California CALA’s executive director, said the average tort costs resulting from an “out-of-balance” civil justice system now average nearly $2,500 per California resident.
“These aren’t abstract numbers,” Gomez told the Record. “They represent lost jobs, shuttered small businesses and higher prices for consumers. Each year, excessive litigation drains opportunity from our communities – costing California an estimated 829,000 jobs.”
The state Legislature has been slow to pass meaningful tort reforms, he said, though a recent proposal, Senate Bill 84, would have taken some pressure off small businesses by allowing those accused of violations of the Americans With Disabilities Act to fix problems before facing litigation and potential financial penalties, according to Gomez.
SB 84 passed that state Senate and attracted bipartisan support but was denied a hearing in the Assembly Judiciary Committee. One small business owner testified before state senators that she was cited for a restaurant table being one-sixteenth of an inch below the federal law’s specifications and subsequently faced an expensive legal settlement.
“Every Californian deserves access to justice, but that access shouldn’t be weaponized for profit,” Gomez said.
