WASHINGTON – Changing California’s lemon law could be the gateway to reforming the state’s stormy legal climate, suggests a legal reform organization.
The U.S. Chamber’s Institute for Legal Reform (ILR) recently contended in a post that the state’s Song-Beverly Consumer Warranty Act, the state's lemon law, would be a fitting place to start considering the act does not provide caps on lawyers’ fees and allows for claims to be eligible for punitive damages under California’s Consumer Legal Remedies Act.
The impact of these laws is acutely illustrated in cases involving alleged auto defects. One law firm, the Knight Law Group, has filed more than 4,000 Song-Beverly suits, the Southern California Record previously reported. More than 8,000 suits have been filed against Ford Motor Co., while General Motor is facing more than 5,000.
The price of litigation in California defective product lawsuits usually exceeds the cost of settling these cases, the ILR indicated, further noting that it’s essentially akin to giving money to attorneys through the shakedown of automakers without performing much legal work.
“Any statute that has no caps on attorney fees, like the Song-Beverly Act, is a recipe for abuse,” former California legislator Bob Huff said. “To my knowledge, this is not high on the legislature's 'redo' list, unless someone points out and documents the abuses to them.”
Becoming law in 1970, the Song-Beverly Consumer Warranty Act was intended to help consumers find resolutions to defective vehicle issues. The law states that if a manufacturer is unable to resolve the defect problem with the customer then the company is required to replace or purchase the vehicle back from the consumer, the ILR post said.
Editor's note: The Southern California Record is owned by the U.S. Chamber Institute for Legal Reform.