New survey ranks California's lawsuit climate 47th worst in the nation

By Karen Kidd | Sep 11, 2017

LOS ANGELES — Litigation over a small businessman's pursuit of the perfect kitty litter scoop is one example of why the lawsuit climate in California continues to rank low compared to other states, according to a survey released this week.

"No one is actually accusing your product of harming anyone," Chuck Firth, the creator of the popular DuraScoop kitty litter scooper, said in a video by Faces of Lawsuit Abuse, a project of the U.S. Chamber Institute for Legal Reform, which owns this publication. "They're just saying, 'You didn't put a warning label on it.'"

After years of litigation, a settlement was reach in the case of the DuraScoop not originally having a warning label, but only after significant costs that Firth's small business could ill afford.

Firth's experience is only one example of what's wrong with the lawsuit climate in California, according to the video by Faces of Lawsuit Abuse. 

John Doherty, president of Civil Justice Association of California  

"The lawsuit climate is playing out like a Hollywood movie," the video said. "But far from a courtroom drama, this is looking more like a horror film. That's because a new survey finds that California's lawsuit climate ranks 47th worst in the nation."

California has the 47th worst legal climate in the U.S., according to the survey, which is scheduled to be released on Sept. 12 by the U.S. Chamber Institute for Legal Reform.  

"California has become a haven for out-of-state lawsuits," the Faces of Lawsuit Abuse video said. "Front and center in the state's lawsuit crisis, Los Angeles. The city is the single worst lawsuit jurisdiction in America, according to the survey."

This year marks the third time since 2012 that California's lawsuit climate has ranked 47th out of 50 states in the Harris Poll conducted for the U.S. Chamber Institute for Legal Reform's annual survey. California has ranked among the bottom ten states every year since 2002, the first year the survey was issued. 

The survey ranks the U.S. states based on the experiences and observations of senior business executives in their states' lawsuit environments.

"Here in California, our legal climate is so bad because of a unique combination of factors," John Doherty, president of Civil Justice Association of California, said in the Faces of Lawsuit Abuse video. "We have courts with a bad structure and bad rules. We have bad laws like Prop. 65."

Proposition 65 was a voter initiative approved 1986 over concerns about toxic chemical exposure. Prop. 65 eventually evolved into the Safe Drinking Water and Toxic Enforcement Act of 1986, which requires businesses to notify California residents about significant amounts of chemicals in their products or that are released into the environment. The initiative also requires California's state government to maintain a list of chemicals that are known to cause cancer, birth defects or other types of reproductive harm. Currently, approximately 927 chemicals are on the list.

"And we have a legislature that's been unwilling to try to reform those problems," Doherty said in the video.

Laws such at Prop. 65 have led to what Bob Dorigo Jones, a senior fellow at the Center for America, has referred to as "California's wacky labels" in an opinion piece published by the Washington Times, as well as major litigation headaches for small business owners like Firth, according to Faces of Lawsuit Abuse research.

"The law requires product warning labels on everything from coffee beans to common plastics in every day products," the Faces of Lawsuit Abuse video said.

Lawsuits against companies like Firth's have a growing impact on business decision-making. About 85 percent of business leaders who participated in the U.S. Chamber Institute for Legal Reform's survey said a state's lawsuit climate will impact business decisions, including where to grow and expand. That percentage is an all-time high for the survey, according to the Faces of Lawsuit Abuse video.  

"For states like California, a bad lawsuit climate is one more factor in determining the cost of doing business in the state," the Faces of Lawsuit Abuse video said.

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Organizations in this Story

Civil Justice Association of California U.S. Chamber Institute for Legal Reform (ILR)

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