FOR IMMEDIATE RELEASE:
CONTACT: Linda Okun
PHONE: (626) 824-8927
March 9, 2004
Two new studies by the California Business Roundtable
and the U.S. Chamber of Commerce show that California’s
civil justice system is in dire need of reform, says Citizens
Against Lawsuit Abuse (CALA).
On March 8, the U.S. Chamber of Commerce issued
its third annual study which ranked California’s liability
system 46th out of 50 in terms of how fair and reasonable the
system is perceived to be by corporate America. An overwhelming
80 percent of respondents also indicated that the litigation environment
of a state could affect decisions such as where to locate or do
business. And 56 percent ranked state court liability systems
as only fair or poor.
“If there is any doubt that California’s
pro-litigation environment hurts businesses, this should erase
it,” said Linda Okun, executive director of CALA in Los
Angeles. “From large corporations who don’t want to
do business in our state to small businesses who are faced with
shakedowns from Unfair Competition lawsuits, California has become
a haven for lawsuit abuse.”
Adding insult to injury for Los Angeles, the
U.S Chamber study also says the Los Angeles court system has the
“least fair and reasonable litigation environment,”
especially toward businesses. This supports a recent report by
the American Tort Reform Association, which named Los Angeles
County as having one of 13 “judicial hellholes” nationwide
where lawsuit abuse occurs.
According to the 2003 “Jury Verdict Survey”
by Jury Verdict Research, the median personal injury award in
California was $65,000, 54 percent higher than the national median
award of $41,894.
"Small and large businesses in California
are facing huge challenges in regulation, taxation and workers
comp, but they're also facing one of the most hostile legal environments
in the nation," said Okun.
The U.S. Chamber report only helped echo the
California Business Roundtable's "California Competitiveness
Project," issued in February 2004, in which 100 percent of
senior executives interviewed view the California business climate
less favorably than other states. Nearly 40 percent said they
planned to relocate jobs out of California, and 50 percent have
explicit policies to halt employment growth in the state.
CALA says California's bad business climate could
improve with two proposals to reform the legal system, which could
help remove the black mark from California’s “unfriendly”
reputation.
“Two proposals to fix the state's unique
and often abused Unfair Competition Law would be a small but desperately
needed start to help address the state’s legal problem,
and give California businesses a glimmer of hope,” said
Okun.
California's Unfair Competition Law (Business
& Professions Code 17200) is the subject of legislation and
an initiative proposed for the November ballot. The legislative
proposal, Assembly Bill 2604, (authored by Assemblyman Robert
Pacheco) requires lawyers bringing Unfair Competition lawsuits
to provide evidence of actual harm.
The initiative, now in the signature gathering
stage, would similarly require an attorney who files a lawsuit
to have an actual client who has been harmed or suffered financial
injury and would allow only public officials (the Attorney General,
District Attorneys and some City Attorneys) to file lawsuits on
behalf of the "general public."
“California will need a lot more than just
reform of one flawed law to improve the legal environment for
employers,” Okun said. “We also need a legislature
that isn’t beholden to the personal injury lawyers lobby,
and more legislation to restore some sanity to the justice system.
Until then, fixing the Unfair Competition Law is just a nice drop
in the bucket.”
To obtain a complete copy of the U.S. Chamber
or California Business Round Table studies, contact CALA at (626)
824-8927.
For more information on these issues, please contact Los Angeles
CALA at (626) 824-8927 or maryann@maryannmaloney.com
.
Linda Okun is the Executive Director of Citizens
against Lawsuit Abuse in Los Angeles, a nonprofit, grassroots
public education organization. Write to her c/o CALA at P.O. Box
262 - Glendora, CA 91740, or via email at maryann@maryannmaloney.com.
IMPORTANT NOTE: If you would like a CALA
speaker to address your organization or some information for your
organization's newsletter, let us know today.
CALA is a nonprofit, grass roots, public education
organization dedicated to serving as a watchdog over the legal
system and those who would seek to abuse it for undeserved gain.
More than 9,000 citizens and taxpayers are Los Angeles CALA supporters.
