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New Law Prohibits Cash-Grabbing ADA Lawsuits

Governor agrees to halt abuse of disability access law

SACRAMENTO – California’s business owners have been plagued for decades by lawsuits aimed at getting cash for lawyers and their handicapped clients. It’s been especially hard on small businesses in towns where most buildings were constructed long before the Americans with Disabilities Act became federal law in 1990.

In fact, nearly 40% of all ADA lawsuits in the United States are filed in California.That percentage should begin to drop significantly thanks to Senate Bill 1186, a tort reform law passed by the State Assembly Aug. 31, the Senate on Sept. 1, and signed by Governor Jerry Brown on Sept. 19. The law became effective immediately.

“There is a serious problem in California where unscrupulous attorneys are filing shakedown lawsuits against businesses in an effort to gain an easy payday with no intention of improving access for the disabled community,” Sen. Bob Dutton (R-Rancho Cucamonga), stated on his State Senate website.

Dutton co-sponsored SB 1186 with Senate Pro Tem Darrell Steinberg (D-Sacramento).

The bill passed the Assembly on a 77-0 vote, and the Senate 34-3, with Senators Noreen Evans (D-Santa Rosa) and Loni Hancock (D-Oakland) voting “no,” along with Senate Majority Leader Ellen M. Corbett (D-San Leandro), who represents the State Senate on the California Commission on Disability Access and the California Commission on Uniform State Laws.

“This is a great example of everyone – Republicans and Democrats, along with members of the business and disabled communities – working together to solve a problem that will benefit everyone in this state,” Dutton added.

SB 1186 outlaws “demand for money” letters from attorneys on ADA claims. They can still send letters to a business to alert the owners of a potential violation or infraction of ADA, but that letter can no longer include a “demand for money.”

Any attorney sending such an advisory letter to a business owner must now send a copy of that letter to the California State Bar, which will examine the letter to make sure it meets the requirements of the new law.

Instead of forcing small business owners to come up with the cash to settle the suit, the new law allows owners time to fix the disability access problem. It also reduces potential damages for such violations from a minimum of $4,000 to as little as $1,000 if the business owners acts quickly to correct the situation.

Before SB 1186 became law, lawyers could collect fees for themselves and “damages” for their clients without requiring the problems to be corrected. So it was less expensive for many business owners to pay a settlement out of court than to correct whatever construction-based violation made their buildings out of compliance with ADA requirements.

“Both supporters and opponents of SB 1186 say most lawsuits are filed by a small number of attorneys whose main objective is to demand – and receive – a settlement of thousands of dollars and not further compliance,” stated the California Disability Community Action Network in an Aug. 28 report on the bill’s progress through the Assembly.

“This bill should provide some relief to small business owners who are making good faith efforts to comply and it should help reign in unscrupulous plaintiffs’ lawyers who have been exploiting the Americans with Disabilities Act for financial gain,” said Kim Stone, president of the Civil Justice Association of California, in a press release Wednesday.

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