Author: Tom Scott

One of the key things CALA will be doing this spring and fall is sending questionnaires to candidates asking where they stand on key legal reform issues. Our questionnaires cover topics such as the impact of litigation on the economy, class action reform and penalties for filing frivolous lawsuits, among others. Most importantly we will be asking them whether they will be accepting contributions from the Consumer Attorneys of California or any of its affiliated political action committees.

According to the Civil Justice Associaton of California, the trial lawyers have given approximately $35.2 million dollars in contributions over the past decade. The trial lawyer influence in elections run vast and deep. Just in 2009, they gave approximately $1 million to incumbent state officials and candidates.

California needs to focus on creating jobs, not a legal climate that encourages more litigation. The reason we are in this economic mess is due to too many taxes, over regulation and a legal climate that is out of control. The legislature needs to adopt legal reforms that will help create jobs in our state, not drive them away.

According to the Institute for Legal Reform, California can go lower – nearly to the bottom. California once again slipped further down the rankings from 44th to 46th in the ILR’s Lawsuit Climate 2010. The only states whose legal climates ranked worse than California’s are Alabama, Mississippi, Louisiana and West Virginia are worse. How’s that for company?

What is even sadder is that our state legislature does not seem to get it. The policy committees that could very easily push through some reform are unwilling to give legal reform a serious chance. So it is business as usual and California continues to slip further down the rankings.

It’s worth taking a look at what earned California is ranking of 46. California’s courts remain a haven for class action lawsuits. California also has a reputation for large jury awards, which adds to its lawsuit-friendly perception. The state is also a growing hot spot for asbestos litigation. Out of state attorneys continue to flock to California to benefit from the state judiciary’s favorable rules towards asbestos suits.

A Los Angeles Times article titled, “Weighed Down By Recession Woes, Jurors Are Becoming Disgruntled,” brought to light some serious concerns about the California jury system.

A few years ago when we went to the one day, one trial system everyone was excited and cheering about how great the system had become. Well, it seems like the happy times are over and our jury system is showing some signs of wear and tear. I will be honest that I was just called for jury service and I was not too thrilled. I have been called a lot and ironically, my wife never gets called. Can someone explain that to me?  We are both registered voters and we both have California drivers licenses and have lived at the same residence for 13 years.

I have been through this plenty of times and find the process rather demeaning. You take time out of your schedule and you are treated like cattle. But, as demeaning as the process is, you really need to serve, even in these hard economic times. We all are experiencing some form of financial hardship during this times, but don’t make excuses. This is only time our country asks us to take the time to serve. It should not be too much to ask considering all the freedoms that come along with being an American.

On Saturday, February 6, an end of an era will come to Sacramento. The famous Squeeze Inn will be closing it’s location at 7916 Fruitridge Avenue in Sacramento. To clarify, The Squeeze Inn is not closing, it is simply closing it’s historic location that became the scene of a lawsuit filed under the Americans with Disabilities Act (ADA) last year. It will be opening its new location right around the corner in the next few weeks.

Famous for it’s 1/3 of a pound hamburger with a bubbling cheese skirt, the Squeeze Inn garnered extra publicity after appearing on the Food Network show, Diners, Drive Ins and Dives. In fact, the show’s host Guy Fieri recently appeared on Jay Leno’s show and ranked it in the two best burgers he has ever had.

Come Saturday, the famous location on Fruitridge will be closing and the cozy 12-seat diner owned by the great Hausauer Family will be no more. A little slice of Sacramento will be gone, all due to an ADA lawsuit. While it will live on in it’s new location and another location in Galt, it wont’ be quite the same.

Governor Schwarzenegger is right on the mark by making legal reform one of his top 5 priorities he outlined in the State of the State. Although legal reform was not part of his speech, it is included as one of his five proposals to get California’s economy back on track.

Focusing on the elimination of frivolous lawsuits as a part of our economic recovery is a huge step forward. Governor Schwarzenegger has always understood litigation reform. He is a businessman and and I think he better than most knows what kind of damage a lawsuit can do.

The Governor’s proposal is to focus on on an atmosphere in which businesses can thrive. He will propose a series of changes to regulations governing class action lawsuits, product liability suits and seek to cap punitive damage awards. While the devil is always in the details, this will be huge reform if delivered to the Governor’s desk later this year.

Well not quite, but it is now on the Watchlist according to the American Tort Reform Foundation (ATRF). The annual report issued by ATRF gives the latest rankings of America’s least fair legal climates. These are places where judges systematically apply laws and court procedures in an inequitable manner, generally against defendants in civil lawsuits. This is ATRF’s eighth annual report.

This year, California has been placed on the report’s Watchlist. The Watchlist shows jurisdictions that may be moving closer or further away from other Hellholes as their respective litigation climates improve or degenerate. I think it is fair to say that ATRF feels California might be slipping further and further into the litigation abyss.

When most people think about where their tax dollars go, they think of schools, parks, public safety and other social service programs. It never occurs to them that some of their hard-earned dollars are paying litigation costs. This is because most of the time the cases against cities, counties and the state are dealt with behind closed doors, shielded from public scrutiny.

In 2007 California CALA shed a little light on these hidden expenses and found that just three cities and four counties in California paid more than $276 million in verdicts, settlements and outside counsel in just two fiscal years. These costs did not even include litigation against school districts.

CALA just released a new report and the findings are staggering. CALA looked at verdicts, settlements and outside counsel for the counties of Alameda, Fresno, Kern, Los Angeles, Orange , Sacramento, San Diego, San Francisco and Santa Clara and the cities of Anaheim, Bakersfield, Fresno, Los Angeles, Oakland, Sacramento, San Diego and San Jose. Of these nine counties and eight cities more than $500 million dollars was spent to deal with litigation. Half a billion dollars! And we have 480 cities and 58 counties in the state. The total cost to our cities and counties would be mind-boggling.

The other day I received a notice of a class action settlement regarding Troyk vs. Farmers Group Inc. It seems like recently I get about one of these a month. This one caught my attention. I have not been with Farmers Insurance for some time and during the period in question I must have been with them for only a brief time.

The class representative in this case is claiming that monthly service charges collected for monthly billing and payment of premiums on Farmers Insurance Exchange auto policies in California and Nevada were illegal. So Farmers is settling the case and the settlement notices go out to current or former policy holders.

As a former policy holder I am entitled to a check for $37.50. Mr. or Mrs. Troyk is entitled to $5,000 for his or her costs, time and effort as acting as the class representative. And the law firm representing “my interests” is getting $5,400,000. This law firm is none other than Bill Lerach’s former firm, Coughlin Stoia Geller Rudman & Robbins. Did I mention that Bill Lerach is serving two years in a federal prison?

In the Weekly Standard, Fred Barnes tackled the issue of tort reform and healthcare reform. It seems that ever since former DNC Chairman Howard Dean (a former doctor) stated that tort reform was not part of the bill because Congress did not want to have to take on the trial lawyers in addition to everyone else, people have been talking about this more and more.

How can you discuss a massive overhaul of our healthcare with out looking at one of the biggest drivers of cost in healthcare? Barnes points to a study that was done in the Massachusetts Medical Society where 83% of doctors say they practice defensive medicine. He also looked at medical malpractice insurance. If doctors have to pay $200,000 annually in malpractice insurance, you can be assured that patients will be paying more.