FLASHREPORT

VOTERS AGREE THAT LAWSUIT ABUSE DESTROYS JOBS

Travis Hausauer, Co-Chair, California Citizens Against Lawsuit Abuse

Lawsuit abuse can take many forms. Sometimes it is someone clearly just looking for a quick payday, or maybe someone has been injured and deserves compensation, but exaggerates the injury to receive far more than the real damage warrants.

Small businesses like mine often face “gotcha lawsuits” in which people go digging for any type of error or non-compliance issue and then file lawsuits or shake down a business for a settlement even though no one’s been hurt. For a small business, a single lawsuit can mean the difference between keeping the doors open and providing jobs for the community or closing the business, depriving the community of jobs and services and further starving our governments of tax revenue.

What’s worse is that our Legislature seems to create new reasons for suing every day through laws that are poorly drafted, short-sighted or written to reward the personal injury attorneys who fund their political campaigns.
 
Simply put, lawsuit abuse hurts the economy and costs jobs. Whether it is large companies facing class action lawsuits or small businesses getting hit with ADA lawsuits, California’s legal climate is known nationally as being unfriendly to business. In fact, California’s legal climate is one reason why a recent poll of business leaders by CEO Magazine found that California’s business climate ranks dead last out of all fifty states.

Well, Californians have finally had enough of their leaders paying lip service to the need to help our ailing economy while continuing to support policies that create lawsuits and hurt job creation.

According to a survey by California Citizens Against Lawsuit Abuse (CALA), California voters across the political spectrum and from all parts of the state believe abusive lawsuits are hurting California’s ability to create jobs. In fact, about two-thirds of the California voters surveyed believe that the number of lawsuits filed against businesses or public entities in California has hurt the state’s economy.

As a small business owner myself, I can attest to the damage that a single lawsuit can do. A few years back, my business, the Squeeze Inn burger joint in Sacramento, was sued for violations of the Americans With Disabilities Act. I was forced to incur massive debt to move my business to a new location, forcing me to push back my plans to grow my business and hire new workers.

Californians have seen this happen time and time again, and know the damage cases like mine can cause. According to the survey, 75% of California voters believe ADA lawsuits have a negative impact on employers and the economy.

I am far from the first business owner in California to delay hiring because of the legal climate. In fact, in April, the CEO of CKE Restaurants, which owns the Carl’s Jr. chain of restaurants, announced he would not be opening any more stores in California, and may in fact seek to move his company’s headquarters out of California, partly due to California’s legal climate and the negative impacts it has had on his businesses. And where is he planning to continue expanding? Texas, where legal reforms over the past decade have helped the state improve its business climate to one of the best in the nation.

A vast majority of California voters believe legal reforms will help the state: more than seven out of 10 voters surveyed believe the state’s liability laws make it harder for employers to do business and succeed in California and almost three quarters of them believe that enacting lawsuit reform is an important part of improving the state’s business environment and attracting and keeping jobs. As California struggles to emerge from the Great Recession, our leaders need to listen to their constituents and pass legal reforms to get our state back on track.

A final note for legislators as they plan their reelection campaigns: The survey found that two-thirds of California voters are likely to support a candidate who supports lawsuit reform as a way to create a better business environment in California.

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