WASHINGTON – The American Tort Reform Association (ATRF) released its annual Judicial Hellholes report last week with the state of California placing as the second worst legal climate in the nation following the Philadelphia Court of Common Pleas.
The ATRF Judicial Hellholes ranking of litigious climates, established in 2002, has “identified and documented places where judges in civil cases systematically apply laws and court procedures in an unfair and unbalanced manner, generally to the disadvantage of defendants,” according to the report.
California, which placed atop the list a year ago, for years has had a legal climate that ranks among the worst for businesses in the country for a number of reasons.
One major issue that the report details is state’s Private Attorneys General Act (PAGA), or what it refers to as the “Sue Your Boss Law.” The bill authorizes employees who are allegedly subject to illegal labor code violations to act as private attorneys general to recover civil penalties from their employers stemming from violations of the labor code. PAGA has led to copious amounts of litigation throughout the Golden State.
“CABIA (California Business and Industrial Alliance) is suing the state, arguing that PAGA is unconstitutional,” said Tom Manzo, founder and president of CABIA. “We want the state to enforce its own labor laws rather than giving trial attorneys the power to do so. CABIA has a trial setting conference scheduled for Jan. 17, 2020. Currently we are litigating our state and federal ‘Equal Protection’ claims based on AB 1654’s exemption of the construction industry from PAGA. Our due process and separation of powers claims will be addressed on appeal.”
CABIA first filed its suit in November 2018.
AB 1654 seeks to provide a PAGA carve-out for unionized construction workers covered by an applicable collective bargaining agreement. Currently the bill is limited to the unionized construction industry but other industries are hoping that it may serve as a prequel to further relief from PAGA.
“One legal observer asked whether there might now be ‘an end in sight’ to PAGA, and said that – because of CABIA – ‘the fight to end PAGA has been initiated,’” said Manzo.