In litigation over the constitutionality of California’s Private Attorneys General Act (PAGA), the U.S. Chamber of Commerce has filed an amicus brief urging the court to find the statute violates the state’s separation of powers doctrine.
California Business & Industrial Alliance (CABIA) v. Bonta asserts that the PAGA statute allows unchecked wielding of state power by private citizens and their attorneys.
The U.S. Chamber brief, filed Dec. 31, notes that PAGA constitutional defects have led to plaintiffs’ attorneys preying on California businesses, and PAGA-like statutes are springing up around the country.
“PAGA punishes businesses but does little to help employees,” the brief states. “The LWDA [Labor and Workforce Development Agency] itself has acknowledged that PAGA may be ‘abused by those who may leverage the threat of litigation on behalf of many workers to benefit only a few.’ (DLSE FY 19/20 Budget Change Proposal, Analysis of Problem (May 10, 2019), at 2.) Even worse, PAGA lawsuits often lead to layoffs and business closures that further harm employees.”
Given the lawsuit’s specific concern with PAGA reform, the amicus brief is a positive development, Victor Gómez, executive director of California Citizens Against Lawsuit Abuse (CALA) told the Northern California Record.
“Number one we are very pleased to see the U.S. Chamber involved in this case,” Gómez said. “I think their opinion carries quite a bit of weight considering their national reputation.”
In this economy, making the public aware of the negative impact of PAGA is even more crucial, Gómez said.
“California is the largest economy in the United States, and the U.S. Chamber understands that it's very important to protect jobs and job creation in the state of California,” Gómez said.
The American Tort Reform Association recently ranked California as the country’s top “Judicial Hellhole,” due in part to frivolous litigation brought under the PAGA statute.
“Outside of the lawsuit, PAGA is something that the state of California needs to look at, no matter what,” Gómez said. “Whether we're talking about the delegation of powers to private attorneys or whether we're talking about drive-by ADA lawsuits or whatever it may be, frivolous lawsuits – and again PAGA specifically – need to be looked at.”
Gómez noted CABIA and others have conducted economic impact reports on the negative effects of PAGA, and that reforming the statute is about helping people maintain their livelihoods here.
“It's going to allow us to keep jobs in California and stop seeing these jobs fleeing to Nevada, Texas, Idaho, and other states,” Gómez said.
(Editor's note: The U.S. Chamber Institute for Legal Reform owns the Northern California Record).