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Finally, Relief for Small Business Owners Plagued by Predatory Litigators

Posted by Tim Lam | Jun 28, 2013 | 0 Comments

The Americans With Disabilities Act, Unruh, Etc. were created with the intent that people with disabilities be afforded equal access to public accommodations, transportation, and other accommodations. In California, however, a small group of attorneys and serial plaintiffs have taken advantage of these protections in an attempt to exploit a set of laws which were never intended to be an income generator for attorneys and opportunistic individuals. These actions prey primarily on small business owners of limited means, and generally offer the business owner the opportunity to make a payment in lieu of costly litigation in order to make the issue go away. It is a low-risk, high yeild proposition to establish a large set of potentially noncompliant properties, develop tenuous causes of action, and shake down the businesses for a nominal fee. California Senate Bill 1186 was signed into law in September, reforming existing legislation and limiting this predatory litigation in several ways.First, businesses with 25 or less employees AND less than $3.5 million in gross annual receipts face reduced statutory damages of $2,000, provided violations are corrected within 30 days of service. These penalties can be further reduced to $1,000 per violation if the defendant corrects all violations within 60 days of service, and the violating location has a Certified Access Specialist inspection report. Furthermore, the site must have improvement or construction approved between 2008 and January 1, 2016.

Second, the common initial demand for payment is now disallowed. Instead, attorneys must advise defendants with a written list of all construction related violations in a format which provides a reasonable and sufficient description of the basis of the claim. All demands and complaints must also be forwarded to the State Bar and the Commission on Disability Access.

Third, if the claim is against a small business, the property has a Certified Access Specialist report, or new construction was permitted in 2008 or later, the bill allows the defendant to request a stay or early evaluation conference.

Fourth, the bill makes it more difficult for the plaintiff to stack multiple claims based on the same violation on multiple dates for the same cause. The court now must consider whether or not the plaintiff acted reasonably in triggering these violations multiple times.

We see this bill as a step in the right direction in reforming the exploitation of law which protects the rights of disabled persons.

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