As a business owner of a franchise for nearly two decades, I always appreciated my community and the passion people had for supporting local family-owned businesses.
Most residents understand the positive impacts of small business. Maybe working for a local burger shop or coffee shop was their first job, so the sense of appreciation for a family-owned operation never left them.
Small business creates a substantial number of jobs in any local community and that translates into millions of jobs statewide. So, you would expect that state and local policy makers would do all that they could to protect these job creators, especially during this COVID-19 pandemic.
Well, maybe not.
Recently, California landed at the No. 3 spot on the 2020-2021 Judicial Hellholes list provided in a report by the American Tort Reform Foundation. It is certainly not an award California should hang on its policy wall of fame.
Judicial Hellholes are the most unjust local courts and state civil justice systems in the country. The 2020-21 report shines a light on lawsuit abuse and its effects.
This year, California may have dropped to No. 3 from No. 2 last year but not because the state is improving. California’s fall to No. 3 cannot be attributed to any improvement in the state’s liability climate but rather results from the severity of problems in Pennsylvania courts and New York City.
Halfway through 2020 California had the most federal Americans with Disabilities Act accessibility lawsuits — 2,702. Most lawsuits allege a restaurant, store or its parking lot fails to meet any of numerous accessibility standards.
For example, if a mirror in a restaurant was an inch too high by ADA standards, there was no “warning” to the business owner, only a lawsuit. Combined, the other states in the top 10 jurisdictions for ADA lawsuits had only 1,845 cases filed between Jan. 1 and June 30.
Businesses, small and large, are struggling to make ends meet, yet California’s leadership once again failed to ease liability burdens and further stacked the deck against their survival.
In fact, almost 60% of Californians believe lawmakers are not doing enough to combat lawsuit abuse and more than 90% believe now is not the time to sue.
Excessive tort costs in California lead to an annual estimated $15.1 billion lost in direct costs and 242,761 jobs. This amounts to each Californian paying a $594.74 “tort tax.”
We should expect our state leaders and governor to do better.
If California wants mom-and-pop businesses to survive, things need to change. It’s time for our state leaders to step up to the plate and protect our small business owners from these frivolous lawsuits. If they refuse to, many will continue to whither in front of our eyes.
Victor Gomez is executive director of California Citizens Against Lawsuit Abuse and a member of the San José Spotlight Board of Directors.