California is ending 2021 with yet one more designation as the worst state for something. California is at the bottom of the country for economic and personal freedoms, our schools rank at the bottom, California has the highest taxes and business-killing regulations, and now, we are once again the #1 “Judicial Hellhole” in the nation.
But we do have many beautiful and renowned beaches.
The American Tort Reform Foundation (ATRF), in its 20th anniversary edition of the annual report, named California is the worst “Judicial Hellhole®” in the country – where frivolous lawsuits thrive and courts produce uneven rulings.
But our ski resorts are powdery excellent.
“After a two-year hiatus, the ‘Golden State’ has once again reclaimed its spot atop the Judicial Hellholes® list,” the ATRF said. “While the state’s demotion was due to the plethora of issues that faced former-Number 1, the Philadelphia Court of Common Pleas and the Supreme Court of Pennsylvania, and not a result of reform; this year it is too hard to ignore the significant lawsuit abuse and liability-expansion occurring in California.”
But our state and national parks are incredible.
California has been in the Top 3 worst Judicial Hellholes® for a decade and was named an “Everlasting Judicial Hellhole” this summer, the ATRF said.
A rundown of the top reasons for California’s “Judicial Hellhole” designation include:
- Baseless Prop-65 lawsuits thrive in courts, volume skyrockets
- Small businesses weighed down by frivolous PAGA lawsuits and ADA litigation
- State’s unique Lemon Law provides windfall for plaintiffs’ attorneys
- Activist attorney general continues to push expansive view of public nuisance law
- Legislature ignores need for reform; pushes liability-expanding agenda
- Hotbed for asbestos litigation
They say the state’s atrocious litigation environment and government officials’ determination to expand liability across the board are to blame for the state’s return to the top – or bottom, as the case may be.
But California has thousands of beautiful hiking trails.
One of the biggest and most devastating reasons for this designation is California’s “Sue Your Boss” Law.
“Golden State employers are being financially crippled by frivolous lawsuits filed under the Private Attorneys General Act (PAGA),” Tom Manzo with the California Business and Industrial Alliance explained in the Globe. PAGA is a unique California law that allows aggrieved employees to file suit against their employer for even a small or accidental violation of California’s more than 1,100-page labor law digest. These lawsuits, while lucrative for the state’s trial attorneys, often cost businesses thousands, if not millions, in settlement and legal fees.”
“While its initial purpose was to protect workers, it has done little to help them. The plaintiffs’ bar has been the true beneficiary,” the American Tort Reform Foundation reports. “PAGA lawsuits have made it more difficult for family-owned businesses like mine to be flexible with employees,” says Ken Monroe, chairman of the Family Business Association of California and president of Holt of California.
“PAGA authorizes ‘aggrieved’ employees to file lawsuits seeking civil penalties on behalf of themselves, other employees, and the State of California for labor code violations. Many PAGA lawsuits revolve around technical nitpicks, such as an employer’s failure to print its address on employees’ pay stubs, even though the address was printed on the paychecks themselves.”
PAGA, often referred to as the Attorney Full Employment Act, does little to help employees, and everything to help unscrupulous trial attorneys get rich quick, Manzo said. “In a typical PAGA case, the attorneys receive 35 percent of the settlement. Both the mediator and the state receive two percent. Then, the remainder is split between the plaintiffs, who are often part of a class-action suit. When the money is divvied up, employees often walk away with little more than spare change while the attorneys rake in millions.”
“The unfortunate reality is that where California goes, the country tends to follow,” American Tort Reform Association President Tiger Joyce said. “The unintended consequences of this precedent could very well have a chilling effect on ingenuity and entrepreneurship across the nation. This is especially dangerous given California courts’ willingness to allow questionable science as expert evidence in trials.”
California is rife with “Americans With Disabilities Act” lawsuit abuse as well.
But our surfing is world class and our waves are tubular.
California is also struggling under the worker classification battle with passage of Assembly Bill 5 by former labor leader Assemblywoman Lorena Gonzalez (D-San Diego), has significantly limited Californians’ ability to work as independent contractors and freelancers. It was revealed during Senate debate in September that the AFL-CIO wrote AB 5, which served to strip independent contractor workers of the ability to work “gig” jobs for themselves, rather than as employees for a company – actors, musicians, writers, truck drivers, doctors and nurses. The goal really was to force millions of California workers into labor unions.
The American Tort Reform Foundation goes into great detail with California’s Proposition 65, the originally well-intentioned law enacted in 1986, and one of the plaintiffs’ bar’s favorite tools to exploit. Baseless Prop-65 litigation unjustly burdens companies that do business in California.
“Prop-65 subjects consumers to ridiculous warnings declaring that most everything causes cancer,” the ATRF says. “It also harms small businesses that do not have the in-house expertise or means to add the necessary warnings or handle litigation.”
“Under Prop-65, businesses are required to place ominous warning signs on products when tests reveal the presence of even the slightest, non-threatening trace of more than 1,000 listed chemicals that state environmental regulators deem carcinogenic or otherwise toxic. Failure to comply can cost up to $2,500 per day in fines, and settlements can cost $60,000 to $80,000.”
But California has thousands of miles of hiking trails.
And with Gov. Gavin Newsom recently extending California’s State of Emergency, as well as his emergency powers, the ATRF points out that California remains one of a few states not to address COVID-19 liability concerns for businesses and individuals on the frontlines during the pandemic.” Two thirds of states have enacted liability protections to date, and while a bill was introduced in California in 2021, legislators refused to grant it a hearing. California small businesses continue to be exposed to potential liability for COVID-related injuries and illnesses, even if the businesses follow health and safety protocols.”
However, 20 states enacted laws that protect healthcare providers, businesses, schools, manufacturers of personal protective equipment, and others from meritless claims during the COVID-19 pandemic, ATRF reports.
And if anyone thinks by moving to Florida or Texas you can escape this judicial hellhole, the ATRF notes that both states are on the Judicial Hellhole Watchlist.
You can read the entire 2021-2022 Judicial Hellhole report at the ATR Foundation website.
Or maybe go Trout fishing at one of California’s stunning lakes.
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