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California Slips in National Ranking of Judicial Hellholes

Dec 27, 2023 11:49AM ● By NFIB California News Release

SACRAMENTO, CA (MPG) - The American Tort Reform Foundation released its latest Judicial Hellholes report showing California now the third worst jurisdiction in the nation, a two-place drop from its previous perch at No. 1 in last year’s report.

“It’s nice to see California drop a few rungs on the Judicial Hellholes ladder,” said John Kabateck, California state director for the National Federation of Independent Business (NFIB), the state’s leading small business association. “But it wasn’t because our Legislature tried. Business owners, especially small business owners, still are in the crosshairs of the most egregious PAGA, Prop. 65, ADA, and now Consumer Privacy Act lawsuits, which give trial attorneys full rein to sue Main Street employers.”

PAGA, the Private Attorneys General Act, comes in for justified criticism in the Judicial Hellholes report, the California section of which begins on Page 30, but just as troubling is the “Trial Lawyers’ Newest Statutory Gold Mine” section (Page 33), which forewarns:

“On January 1, 2023, the California Privacy Rights Act of 2020 (CPRA) went into effect. This Act replaced the California Consumer Privacy Act (CCPA) and addressed some of the CCPA’s ambiguities. It eliminates a business’ 30-day window to cure, grants new rights to consumers, and increases business’s contractual obligations. It also creates the California Privacy Protection Agency to enforce the CPRA, which will fine businesses $2,500 for violations and $7,500 for intentional violations and those involving a minor. While the Act took effect in 2023, it applies to data collected beginning on January 1, 2022. In July, California Attorney General Rob Banta announced that his office was doing an ‘investigative sweep’ of all large employers in the state to ensure they are in compliance with the Act. Apart from the attorney general investigations, consumers can sue for cash awards following a data breach without proving an actual injury, making it easy for trial lawyers to bring massive class actions. The law also provides for treble damages and attorneys’ fees, creating a large incentive for the plaintiffs’ bar to file lawsuits.”

From the Executive Summary, “Endless Prop-65 litigation targets a variety of industries and no-injury Private Attorney General Act (PAGA) and Americans with Disabilities Act (ADA) accessibility lawsuits bog down business. The state’s unique Lemon Law is a gold mine for plaintiffs’ lawyers and arbitration is under attack in both the courts and the legislature. California also is at the forefront of the environmental litigation battle.”

Keep up with the latest on California small-business news at www.nfib.com/california or by following NFIB on Twitter @NFIB_CA or on Facebook @NFIB.CA.

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