California continues its legacy of leading the nation with hostile, predatory legal climate

Shawn Lewis
NFIB/CA State Communications Director

Today the American Tort Reform Foundation issued its 2017-2018 Judicial Hellholes report, ranking civil courts in California among the nation’s most unfair. It is no secret the State of California leads the nation with its hostile legal climate which rewards predatory litigation on the backs of struggling small businesses across the state. Our state being ranked the #2 judicial hellhole in the nation is certainly no commendation to be proud of.

Since its inception in 2002, the American Tort Reform Foundation (ATRF)’s Judicial Hellholes report has identified and documented the worst abuses within the civil justice system, focusing primarily on those jurisdictions where courts have been radically unfair and out of balance. The content of this report builds off the American Tort Reform Association’s (ATRA) real-time monitoring of Judicial Hellhole activity year-round and reflects feedback gathered from countless firsthand sources. For Californians, unfortunately this year’s report hits very close to home. California earned the number-two spot as the worst in the country with its expansions of civil liability as well of the honor of being the West Coast’s perennial Judicial Hellhole.

The Golden State is indeed just that for personal injury lawyers seeking riches at the expense of small businesses, jobseekers and those desperately in need of affordable housing. It is no surprise California earned this abysmal ranking given that the state enacts more than 800 new laws every year, many of which are specifically designed to expand civil liability at the behest of politically influential personal injury lawyers. Because of this, legislators and the governor make it all but impossible for California residents and small businesses to stay perfectly compliant and thus avoid being targeted by the nearly 1 million civil lawsuits filed here annually.

California’s long list of civil injustices include precedent-defying state supreme court decisions, the Private Attorneys General Act (PAGA), Proposition 65, food and beverage litigation, so-called innovator liability, the California Environmental Quality Act’s impact on affordable housing, court’s expansion of public nuisance law and natural disaster-chasing personal injury lawyers, among others.

Another trend we see popping up across the country are food industry class action suits, but California takes the cake and is a national leader. Since so many of these class action suits are filed in California, some state and federal courts in the northern part of the state have aptly been nicknamed the “Food Court.” While many of these lawsuits prove fruitless in court, the reputational damage done to many small businesses by plaintiffs’ lawyers seeking to make a pretty penny is a prime example of the abuse of the civil justice system.

Consumer advocates say that these class action lawsuits are the most effective way to hold companies accountable for what they allege to be misleading marketing. But real-life consumers, those the litigation is supposed to protect, are often harmed as defendants’ legal costs and sometimes multimillion-dollar verdicts or settlements are passed on in the form of higher prices and fewer choices.

One bit of good news is the U.S. Supreme Court in June reversed a California high court decision in Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County, without which would have thrown California’s courthouse doors open even wider to out-of-state plaintiffs suing out-of-state defendants over alleged out-of-state injuries. However, we need to do much more in California to make commonsense reforms to our legal system which unfairly gets trial lawyers rich on the backs of struggling small businesses and taxpayers.

Shawn Lewis is the State Communications Director for NFIB California, which represents 22,000 dues-paying small business members across the state.

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