As businesses seek to reopen amid the economic challenges of the pandemic, concerns persist that excessive litigation is causing many to close or leave the state and that such data has hasn’t prompted reform efforts by the state Legislature.
A recent analysis by Seyfarth Shaw LLP, which shows California leads the increase in ADA lawsuits, is raising questions about what happened to the law passed 10 years ago to stem such cases, and how to quantify the impact on small businesses here.
Many trial attorneys filing ADA suits focus on smaller operations rather than large corporations or manufacturers with their own in-house counsel, Victor Gómez, executive director of California Citizens Against Lawsuit Abuse (CALA) told the Northern California Record.
“They tend to focus on entrepreneurs, on small mom and pop businesses because they see it as easy prey,” Gómez said. “They want the least amount of opposition as possible; they want to go after businesses that really don't have the resources to protect themselves as larger companies probably would.”
According to the Center for Jobs & the Economy list of “CaliFormers,” more than 450 companies have moved some or all of their operations out of California since 2018.
A new report by the Alliance for Consumers found trial lawyers have sought political influence through campaign contributions.
Absent further action at the state level, Gómez noted municipalities have initiated efforts to help small businesses with ADA compliance.
“Cities like San Jose have taken a leadership role, and have said we're going to help our small businesses by helping them with ADA inspections, to make sure that they're in compliance and, in addition to that, we’re going to give them money, as grants, to bring their establishment up to up to par; those are good things,” Gómez said.
San Mateo County officials have also been asked to take steps to help local businesses with ADA compliance.
Whereas many ADA suits concern physical barriers, the Seyfarth study shows non-compliant website allegations have caused litigation to increase exponentially in recent years.
“They’re going after these places via their websites,” Gómez said. “That is extremely disappointing because they have no desire to patronize that establishment, all they have is a desire to sue them.”
A reasonable solution is a reasonable grace period, Gómez said.
“They need legislation to allow a 90-day grace period for these businesses to come into compliance once a notice is given,” Gómez said. “When these places are being sued, you’re not really addressing the root issue of ADA law, all you're doing is giving trial attorneys an opportunity to make money without actually fixing the problem.”
The result has been more closures, more businesses leaving California for states like Texas, Idaho, Arizona, and Nevada, Gómez said. “Until they actually do things like provide these remedies for them, more California businesses will continue to flee the state.”