Northern California Record

Thursday, December 12, 2019

State's poor lawsuit climate ranking largely due to meritless litigation, PAGA and Prop 65, CALA director says

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By Rich Peters | Sep 27, 2019


SACRAMENTO – The 2019 Lawsuit Climate Survey: Ranking the States, conducted by The Harris Poll on behalf of the U.S. Chamber Institute for Legal Reform (ILR), has ranked California 48th in the nation in a lawsuit climate survey, dropping two spots from a year ago.

“Most Californians are shocked when they learn about the crush of litigation facing small businesses in the state,” California Citizens Against Lawsuit Abuse Executive Director Ken Barnes said in a statement. “However, defense attorneys encountered these challenges daily on behalf of the state's employers. I don't believe real data skews the results, but rather informs them to create a full picture of the damage being done to California's economy.”

The survey polled senior business executives with first-hand knowledge of litigation about the fairness and reasonableness of state court systems.

While California ranked poorly, Barnes believes there are sensible ways to get the legal system back on track.

“The bulk of the litigation filed in California lacks merit or is based on a very minor or technical violation of the law,” Barnes said. “For example, most PAGA (Private Attorneys General Act) labor claims are based on issues which caused no harm, such as typographical errors on a wage statement. California can address these abuses by allowing a small right to cure window, in which minor errors can be corrected without six- and seven-figure settlements.”

The ILR cited "abusive litigation" as one of the reasons for the state's low ranking.

“Reasons for California’s low ranking abound, including litigation connected to the state’s infamous Prop. 65 law, abusive litigation over the Americans with Disabilities Act (ADA), laws that allow private plaintiffs’ lawyers to sue as if they were the state’s attorney general, and eye-popping jury verdicts,” an ILR press release states. “While the state has a large economy, the poor perception of California’s legal climate should be a concern. That’s because a record-high 89 percent of survey participants said a state’s lawsuit environment is likely to impact their company’s decisions about where to locate or do business.”

The survey is based on a national sample of more than 1,300 in-house general counsel, senior litigators or attorneys and senior executives.

Editor's note: The Northern California Record is owned by the U.S. Chamber Institute for Legal Reform. 

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Organizations in this Story

U.S. Chamber Institute for Legal Reform (ILR)California Citizens Against Lawsuit Abuse

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