Back in July of 2013, I blogged about the passage and implementation of California Senate Bill SB-1186, a bill intended to curb abusive lawsuits based on the federal Americans with Disabilities Act (ADA). In that article, I chronicled some infamous abuses of the law by unscrupulous litigants (and their attorneys) and explained the basics of the bill. I also noted, “Although the changes seem to be promising, Orlick and Sudeck [attorneys writing for the HotelLaw blog] remain hardened by their experience as defenders against ADA lawsuits. They conclude, ‘Experienced plaintiff’s attorneys have already figured out how to work within the boundaries of or circumvent the new law. It does not appear to be slowing the onslaught of lawsuits.’”
Apparently, Orlick and Sudeck’s observation was spot on. As a result, the California legislature has recently introduced three new bills—AB 52 (December, 2014), AB 54 (December, 2014), and SB 67 (January, 2015)—that are meant to further curb abusive ADA lawsuits and remedy some of the defects of Senate Bill SB 1186.
As mentioned in my prior blog article, California, like some other states, allows ADA plaintiffs to recover damages in addition to those recovered under the federal ADA law itself. Existing law allows minimum statutory damages for $4,000 per offense, although SB-1186 reduced that minimum to $1000 as long as the defendant meets either of the following requirements: (A) the site’s new construction or improvement was approved pursuant to the local building permit and inspection process on or after January 1, 2008, and before January 1, 2016, or (B) the site’s new construction or improvement was approved by a local public building department inspector who is a CASp (Certified Access Specialist).
I also noted that SB-1186 provided that “[s]ome defendants can request a stay of court proceedings and an early evaluation conference,” as long as they met the following requirements: (A) the site’s new construction or improvement was approved pursuant to the local building permit and inspection process on or after January 1, 2008, and before January 1, 2016, (B) the site’s new construction or improvement was approved by a local public building, and (C) the defendant is a “small business” under the Code and declares that all violations were corrected or will be corrected within 30 days of service of the complaint.
In its current form, SB 67 would make significant changes to this existing law. According to the legislative digest for SB 67, the bill, authored by California state senator Cathleen Galgiani,
would except a small business from statutory damage liability in connection with a construction-related accessibility claim, as described above, and would instead limit recovery to injunctive relief and reasonable attorney’s fees as deemed appropriate by the court.
The bill would also extend the period for correcting construction-related violations to within 120 days of being served with the complaint. Like SB-1186, SB 67 would apply to “small businesses.” The bill defines a “small business” as one that “has employed 25 or fewer employees on average over the past three years, or for the years it has been in existence if less than three years, as evidenced by wage report forms filed with the Economic Development Department, and has average annual gross receipts of less than three million five hundred thousand dollars ($3,500,000) over the previous three years, or for the years it has been in existence if less than three years, as evidenced by federal or state income tax returns.”
According to the legislative digest for AB 52, the bill would “provide that a defendant’s maximum liability for statutory damages in a construction-related accessibility claim against a place of public accommodation is $1,000 for each offense if the defendant has corrected all construction-related violations that are the basis of the claim within 180 days of being served with the complaint and the defendant demonstrates that the structure or area of the alleged violation was determined to meet standards or was subjected to an inspection, as specified.”
In addition, the bill would “reduce that maximum liability to $1,000 for each offense if the defendant has corrected all construction-related violations that are the basis of the claim within 180 days of being served with the complaint and the defendant is a small business, as revised. The bill would also provide that specified statutory damages in a construction-related accessibility claim against a place of public accommodation that is a small business, as defined, may only be recovered if the place of public accommodation is granted a 180-day stay of court proceedings to meet specified requirements.” The bill’s definition of a “small business” is the same as for SB 67.
AB 54, introduced by Assemblywoman Kristin Olsen, would provide that when a plaintiff brings a claim alleging a violation of a construction-related accessibility standard against a “place of public accommodation” within 3 years of a change in that standard, the plaintiff may collect statutory damages only if he or she also provides the business with “a written notice or demand letter at least 60 days prior to filing any action and the violation is not cured.” By using the phrase “place of public accommodation” in this portion of the bill, AB 54 does not appear to be limited to “small businesses” as defined in the other two bills.
It remains to be seen whether these proposed laws will get enacted in their current form and, if so, whether resourceful ADA plaintiff’s lawyers will find ways to get around them, as they appear to have done in the case of SB-1186. In the view of some, the legislation could also be improved by placing a cap on the number of ADA lawsuits an individual litigant can bring in a 12 month period. The would be similar to the rule that caps the number of lawsuits someone can bring in small claims court. (Currently, in California a litigant may not sue more than twice in one calendar year for over $2,500.) Such a cap could possibly prevent serial litigants from using the ADA laws to perpetuate a litigation cottage industry for their own financial gain.