BILL ANALYSIS                                                                                                                                                                                                    Ó






                             SENATE JUDICIARY COMMITTEE
                             Senator Noreen Evans, Chair
                              2011-2012 Regular Session


          SB 603 (Berryhill)                                     
          As Amended March 31, 2011 
          Hearing Date: May 10, 2011                             
          Fiscal: No
          Urgency: No                                            
          SK                                                     

                                        SUBJECT
                                           
                     Vexatious Litigants: Represented Plaintiffs

                                      DESCRIPTION  

          Existing law authorizes a court to declare a person to be a 
          vexatious litigant when that person has repeatedly abused the 
          judicial process by bringing meritless lawsuits in propria 
          persona (for one's self) (pro per).  This bill would remove the 
          requirement that the action be brought in pro per so that a 
          plaintiff represented by an attorney could be declared a 
          vexatious litigant if he or she met existing statutory 
          requirements.

                                      BACKGROUND  

          Under existing law, a court may declare a person to be a 
          vexatious litigant when that person represents himself or 
          herself and has repeatedly abused the legal system by doing any 
          of the following: (1) filed at least five unmeritorious lawsuits 
          in the past seven years; (2) repeatedly relitigates, after a 
          final adverse finding, the validity of the final determination 
          or the actual cause of action against the same defendant; (3) 
          repeatedly engages in tactics that are frivolous or solely 
          intended to cause unnecessary delay; and (4) has previously been 
          declared to be a vexatious litigant by a state or federal court 
          in an action based upon the same or substantially similar facts.

          Current law permits a court to enter a prefiling order which 
          prohibits a vexatious litigant from filing any new litigation in 
          pro per ("pro per" refers to a plaintiff who represents himself 
          or herself) without first obtaining permission of the presiding 
          judge of the court where the litigation is to be filed.  




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          Existing law permits the judge to allow the filing of that 
          litigation only if it appears that the litigation has merit and 
          has not been filed for the purposes of harassment or delay.  The 
          court may also require the plaintiff to furnish a security to 
          assure payment of reasonable expenses.  

          In the spring of 2010, the Policy Coordination and Liaison 
          Committee, the Trial Court Presiding Judges Advisory Committee, 
          and the Civil and Small Claims Advisory Committee of the 
          Judicial Council proposed legislation to improve the practice 
          and procedure for courts dealing with vexatious litigants.  That 
          proposed legislation has been introduced by this Committee (SB 
          731 (Committee on Judiciary)), and is currently pending in the 
          Assembly.  As a part of its process, the Judicial Council 
          committees circulated the proposal that would eventually become 
          SB 731 during its spring 2010 invitation-to-comment cycle.  
          Several of the comments received concerned "whether section 
          391.7 should be expanded to apply to a vexatious litigant 
          represented by an attorney."  The advisory committees did not 
          incorporate such a provision in the legislative proposal and 
          instead "decided to defer recommending legislation that would 
          expand the applicability of section 391.7 to a vexatious 
          litigant represented by counsel."

          This bill, sponsored by the Civil Justice Association of 
          California, would expand the applicability of California's 
          vexatious litigant statute to include plaintiffs represented by 
          counsel.

                                CHANGES TO EXISTING LAW

          1.Existing law  defines "vexatious litigant" to mean a person who 
            does any of the following:
           a.   In the immediately preceding seven years, filed, in pro 
               per, at least five actions, other than in small claims 
               court, that have been either: (1) finally determined 
               adversely to the person or (2) unjustifiably permitted to 
               remain pending at least two years without having been 
               brought to trial or hearing;  
            b.   After a final adverse ruling against the person, 
               repeatedly relitigates or attempts to relitigate, in pro 
               per, either: (1) the validity of the final determination or 
               (2) the actual cause of action against the same defendant;
           c.   In any litigation while acting in pro per, repeatedly 
               files unmeritorious motions, pleadings, or other papers, 
               conducts unnecessary discovery, or engages in other tactics 




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               that are frivolous or solely intended to cause unnecessary 
               delay; and  
            d.   Has previously been declared to be a vexatious litigant by 
               a state or federal court in an action based upon the same 
               or substantially similar facts.  (Code Civ. Proc. Sec. 
               391.)
            
            Existing law  provides that a defendant may make a motion for 
            an order requiring a plaintiff to provide security when it can 
            be shown that the plaintiff is a vexatious litigant and there 
            is not a reasonable probability that he or she will prevail in 
            the litigation.  (Code Civ. Proc. Sec. 391.1.)  After hearing 
            the evidence upon the motion, if the court determines that the 
            plaintiff is a vexatious litigant and that there is no 
            reasonably probability that he or she will prevail, the court 
            must order the plaintiff to furnish security in an amount 
            determined by the court and for the benefit of the defendant.  
            (Code Civ. Proc. Sec. 391.3.)  If that security is not 
            furnished, the lawsuit shall be dismissed.  (Code Civ. Proc. 
            Sec. 391.4.)

             This bill  would delete "in pro per" from (b) and (c) above, 
            thus expanding the applicability of these sections to include 
            plaintiffs represented by counsel.

             This bill  would specify that a vexatious litigant designation 
            shall not attach to an attorney representing a vexatious 
            client. 

           2.Existing law  permits the court to enter a prefiling order 
            which prohibits a vexatious litigant from filing any new 
            litigation in pro per without first obtaining permission of 
            the presiding judge of the court where the litigation is to be 
            filed.  Existing law permits the judge to allow the filing of 
            that litigation only if it appears that the litigation has 
            merit and has not been filed for the purposes of harassment or 
            delay.  (Code Civ. Proc. Sec. 391.7.)

           This bill  would delete "in pro per" from this provision, thus 
            expanding the applicability of this sections to include 
            plaintiffs represented by counsel.
           
          3.Existing law  permits a trial court to order a party or the 
            party's attorney to pay any reasonable expenses incurred by 
            another party as a result of bad-faith actions or tactics that 
            are frivolous or solely intended to cause unnecessary delay.  




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            (Code Civ. Proc. Sec. 128.5.)

           Existing law  provides that by presenting to the court a 
            pleading, petition, written notice of motion or similar paper, 
            an attorney is representing to the best of his or her 
            knowledge, information, and belief that the following 
            conditions are true: 
           a.   it is not being presented primarily for an improper 
               purpose, such as to harass or to cause unnecessary delay or 
               needless increase in the cost of litigation;
           b.   the claims, defenses, and other legal contentions therein 
               are warranted by existing law or a nonfrivolous argument 
               for the extension, modification, or reversal or existing 
               law or the establishment of new law;
           c.   the allegations and other factual contentions have 
               evidentiary support, or are likely to have that support 
               after a reasonable opportunity for further investigation or 
               discovery; and
           d.   the denials of factual contentions are warranted on the 
               evidence or are reasonably based on a lack of information 
               or belief.  (Code Civ. Proc. Sec. 128.7(b).)

             Existing law  authorizes a court to impose sanctions against an 
            attorney if the court determines that any of the above 
            provisions in Section 128.7(b) have been violated.  Existing 
            law provides that a motion for sanctions shall be made 
            separately from other motions or requests and shall describe 
            the specific conduct alleged to violate Section 128.7(b).  The 
            court may also impose sanctions on its own motion, as 
            specified.  (Code Civ. Proc. Sec. 128.7(c).)
             
            This bill  would require a court to make its decision on the 
            record regarding a motion for sanctions pursuant to the above 
            and to specify the reasons for the decision. 

           4.Existing law  provides in family law cases that a court may 
            base an award of attorney's fees and costs on the extent to 
            which the conduct of each party or attorney furthers or 
            frustrates the policy of the law to promote settlement of 
            litigation and, where possible, to reduce the cost of 
            litigation by encouraging cooperation between the parties and 
            attorneys.  Existing law requires the court in making an award 
            of attorney's fees and costs-which are in the nature of a 
            sanction-to take into consideration all evidence concerning 
            the parties' incomes, assets, and liabilities.  Under existing 
            law, the court may not impose a sanction that imposes an 




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            unreasonable financial burden on the party against whom the 
            sanction is imposed.  (Fam. Code Sec. 271.)

           This bill  would provide that when a court is requiring security 
            of a vexatious litigant in family court litigation, the 
            court's determination of that security shall be based on the 
            same considerations as used in the section above.

           This bill  would provide that the vexatious litigant statutes do 
            not apply to litigation involving domestic violence, child 
            custody, or child support.

                                        COMMENT
           
           1.Stated need for the bill  

          In support of the bill, the author writes: 

            Excessive and unwarranted lawsuits have been identified as a 
            significant problem in California that greatly hinders the 
            state's economy.  . . .  Case law has held that once a person 
            receives a vexatious litigant designation, thereafter they are 
            still subject to having to file a bond if they hire an 
            attorney but not prefiling approval by a judge.  Additionally, 
            there have been cases where a vexatious litigant gets someone 
            to be their attorney to file a case, to only come off the case 
            just to help the litigant get around the procedural 
            requirements so that the harassment can continue.  Just 
            because someone has an attorney does not mean he or she is not 
            acting as a vexatious litigant.  A vexatious litigant status 
            is imposed sparingly by judges and is a good tool to help 
            control uncontrollable filings in a case; this bill would 
            remove this distinction and allow a judge to find a person a 
            vexatious litigant irrespective of whether he or she has an 
            attorney if the level of abuse has reached such a level.

            Although there are some provisions on the books to protect 
            against this problem, courts are often reluctant to employ 
            them, moreover, when denying motions that would otherwise stop 
            this conduct, they are not required to make written findings 
            on their decisions which means there is no appeal of that 
            issue.  Wronged parties often have no recourse when an 
            attorney acts on behalf of a client in bringing these claims 
            but to engage in settlement (thereby encouraging nuisance 
            suits) or pay for expensive litigation to take a principled 
            stand.  California's court system is already overwhelmed by 




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            the number of cases it has to deal with, so providing more 
            scrutiny and authority to manage these cases will help reduce 
            needless filings. 

            Lawsuit abuse costs Californians millions of dollars every 
            year and perpetuates a climate of fear for many small business 
            owners.  Consumers pay for frivolous lawsuits as businesses 
            increase prices to cover their legal costs or shut down 
            entirely.

          Sponsor Civil Justice Association of California writes:

            The vexatious litigant statute was enacted in 1963 in order to 
            curb unwarranted litigation within California by allowing 
            courts to require a security bond or approval of the court to 
            file additional litigation (The California Vexatious Litigant 
            Statute: A Viable Judicial Tool to Deny the Clever 
            Obstructionists Access?, 72 S. Cal. L. Rev. 275, First Western 
            Development Corp. v. Superior Court (1989) 212 Cal. App. 3d 
            860)  Courts and commentators have observed that those who are 
            found to be vexatious litigants cannot avoid the statute by 
            thereafter hiring counsel because the purpose of the statute 
            would be frustrated (The Vexatious Litigant, (1966) 54 Cal. L. 
            Rev. 1769, Forrest v. Dept. of Corporations (2007) 150 Cal. 
            App. 4th 183, Camerado Ins. Agency, Inc. v. Superior Court 
            (1993) 12 Cal.App.4th 838, and In re Shieh (1993) 17 
            Cal.App.4th 1154).  However, this has not been consistently 
            applied, for example, a court recently found that the 
            requisite approval to file additional litigation did not apply 
            after a person hired an attorney (Flores v. Georgeson (2011) 
            191 Cal.App.4th 881) and in another the filing requirement was 
            held to apply at the very beginning of a case, so that as long 
            as an attorney represented the vexatious litigant at the 
            beginning of a lawsuit it did not matter that the attorney 
            withdrew (Shalant v. Girardi, 183 Cal.App.4th 545 (2010), 
            review granted).

            Many vexatious litigants, even those with lawyers, file 
            unwarranted lawsuits. Excessive and unwarranted lawsuits drive 
            up business expenses, cost government additional money and 
            increase the cost of goods and services for all Californians. 
            Consumers pay for unjustified lawsuits as businesses increase 
            their prices to cover legal costs or shut down.  Additionally, 
            employers cannot hire new employees or grow their business 
            when they are spending precious capital in defending against 
            meritless actions in litigation.




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            This bill stems from one business' attempt to fight abusive 
            tactics that have included legal threats, irrational motions 
            to disqualify multiple judges, meritless ex-parte motions, and 
            claims against unrelated third parties.  It will cost this 
            local business well over $300,000, even though the dispute is 
            over a $6,500 claim. Businesses who are already struggling to 
            stay afloat in this economic downturn should not have to waste 
            resources on shakedown lawsuits instead of keeping their doors 
            open or hiring more employees.

           2.Purpose of vexatious litigant statute/current law already 
            addresses improper behavior by lawyers
           
          Under existing law, a court may declare a person to be a 
          vexatious litigant when that person has repeatedly abused the 
          judicial process by bringing meritless lawsuits in pro per.  
          This bill would remove the requirement that the action be 
          brought in pro per, thus allowing a plaintiff represented by an 
          attorney to be declared a vexatious litigant if he or she met 
          existing statutory requirements.

             a.  Statutory requirements 

             Those statutory requirements  law define a "vexatious 
            litigant" to mean a person who does any of the following: (1) 
            in the immediately preceding seven years, filed, in pro per, 
            at least five actions, other than in small claims court, that 
            have been either (a) finally determined adversely to the 
            person or (b) unjustifiably permitted to remain pending at 
            least two years without having been brought to trial or 
            hearing; (2) after a final adverse ruling against the person, 
            repeatedly relitigates or attempts to relitigate, in pro per, 
            either (a) the validity of the final determination or (b) the 
            actual cause of action against the same defendant; (3) in any 
            litigation while acting in pro per, repeatedly files 
            unmeritorious motions, pleadings, or other papers, conducts 
            unnecessary discovery, or engages in other tactics that are 
            frivolous or solely intended to cause unnecessary delay; or 
            (4) has previously been declared to be a vexatious litigant by 
            a state or federal court in an action based upon the same or 
            substantially similar facts.  

            Once a plaintiff is declared to be a vexatious litigant, a 
            defendant may make a motion for an order requiring a plaintiff 
            to provide security when it can be shown that the plaintiff is 




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            a vexatious litigant and there is not a reasonable probability 
            that he or she will prevail in the litigation.  After hearing 
            the evidence upon the motion, if the court determines that the 
            plaintiff is a vexatious litigant and that there is no 
            reasonable probability that he or she will prevail, the court 
            must order the plaintiff to furnish security in an amount 
            determined by the court and for the benefit of the defendant 
            to assure payment of reasonable expenses.  If that security is 
            not furnished, the lawsuit shall be dismissed. 

            A vexatious litigant may also be subject to a prefiling order 
            which prohibits that litigant from filing any new litigation 
            in pro per without first obtaining permission of the presiding 
            judge of the court where the litigation is to be filed.  
            Existing law permits the judge to allow the filing of that 
            litigation only if it appears that the litigation has merit 
            and has not been filed for the purposes of harassment or 
            delay. 

             b.  Purpose of vexatious litigant statute

             The vexatious litigant statute was enacted in 1963 to "curb 
            the abuse of vexatious litigation" (3 Witkin, Cal. Procedure 
            (5th) Actions Sec. 365), and to prevent abuse of the judicial 
            process.  In First Western Development Corp. v. Superior Court 
            (1989) 212 Cal. App. 3d 860, the court noted:

              The vexatious litigant statutes were enacted to require a 
              person found a vexatious litigant to put up security for the 
              reasonable expenses of a defendant who becomes the target of 
              one of these obsessive and persistent litigants whose 
              conduct can cause serious financial results to the 
              unfortunate object of his attack.  The purpose of the 
              statutory scheme is to deal with the problem created by the 
              persistent and obsessive litigant who has constantly pending 
              a number of groundless actions, often against the judges and 
              other court officers who decide or were concerned in the 
              decision of previous actions adversely to him.  . . . 

              A litigant who loses then burdens the courts with new 
              actions and repeated appeals based on the same controversy 
              and with no reasonable possibility of prevailing wastes 
              valuable court time.  It is axiomatic in our system of 
              justice that every person is entitled to his day in court; 
              however, a litigant is not entitled to two days in court.  
              İcitations omitted] (Id. at 867-870).




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            By applying only to pro per plaintiffs, the vexatious litigant 
            statute distinguishes between plaintiffs who bring their cases 
            in pro per and those who are represented by attorneys.  In 
            upholding this distinction, the First District Court of Appeal 
            held that the statute's application "to persons proceeding in 
            propria persona is not arbitrary or unreasonable.  Attorneys 
            are governed by prescribed rules of ethics and professional 
            conduct, and, as officers of the court, are subject to 
            disbarment, suspension, and other disciplinary sanctions not 
            applicable to litigants in propria persona."  (Taliaferro v. 
            Hoogs, (1965) 236 Cal.App.2d 521.)

             c.  Current already law addresses improper behavior by lawyers

             As the court in Taliaferro noted, current law already contains 
            a number of sanctions that may be imposed on attorneys when 
            they engage in improper conduct.  As a result, limiting the 
            vexatious litigant statute to actions brought by pro per 
            plaintiffs is appropriate.  For example, Code of Civil 
            Procedure Section 128.5 permits a trial court to order a party 
            or the party's attorney to pay any reasonable expenses 
            incurred by another party as a result of bad-faith actions or 
            tactics that are frivolous or solely intended to cause 
            unnecessary delay.

            Code of Civil Procedure Section 128.7 authorizes a court to 
            impose sanctions against an attorney if the court determines 
            that the attorney has violated any of the following by 
            presenting to the court a pleading, petition, written notice 
            of motion or similar paper: (1) the filing is primarily filed 
            for an improper purpose, such as to harass or to cause 
            unnecessary delay or needless increase in the cost of 
            litigation; (2) the claims, defenses, and other legal 
            contentions therein are not warranted by existing law or a 
            frivolous argument for the extension, modification, or 
            reversal or existing law or the establishment of new law; (3) 
            the allegations and other factual contentions do not have 
            evidentiary support, or are not likely to have that support 
            after a reasonable opportunity for further investigation or 
            discovery; and (4) the denials of factual contentions are not 
            warranted on the evidence or are not reasonably based on a 
            lack of information or belief.

            Existing law also permits a court to impose sanctions against 
            an attorney or a party for engaging in conduct that is a 




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            misuse of the discovery process.  (Code Civ. Proc. Secs. 
            2023.010 - 2023.040.)  Finally, existing law, the State Bar 
            Act, provides that it is the duty of an attorney to do, among 
            other things, the following and subjects the attorney to 
            possible discipline for violation:  (1) maintain the respect 
            due to the courts of justice and judicial officers; (2) 
            counsel or maintain those actions, proceedings, or defenses 
            only as appear to him or her legal or just, except the defense 
            of a person charged with a public offense; and (3) employ, for 
            the purpose of maintaining the causes confided to him or her 
            those means only as are consistent with truth, and never to 
            seek to mislead the judge or any judicial officer by an 
            artifice or false statement of fact or law.  (Bus. & Prof. 
            Code Sec. 6068.)
                                                                           
            On these points, the Consumer Attorneys of California write in 
            opposition, ". . . sanctions law is carefully designed to 
            punish bad tactics without discouraging innovative, cutting 
            edge legal theories such as those involving civil rights.  . . 
            .  The vexatious litigant statute was enacted to restrict the 
            ability of unrepresented individuals to repeatedly initiate 
            unmeritorious claims.  The problem of attorney initiated 
            vexatious litigation, although real, has already been 
            addressed.  The legislature has carefully reviewed 
            California's sanctions statutes, and in 1994 enacted İSection 
            128.7]  . . .  to provide additional checks against 
            'frivolous' actions.  The amendments were carefully crafted to 
            permit sanctions against attorneys' improper conduct, and to 
            address tactics whether engaged in by a plaintiff or defense 
            attorney.  Most importantly, the legislature strove to strike 
            a balance in deterring bad tactics without chilling legitimate 
            advocacy."

            IS THIS BILL NECESSARY GIVEN THAT OTHER PROVISIONS OF LAW 
            ALREADY DEAL WITH IMPROPER TACTICS BY LAWYERS? 

           1.Does this bill have a possible chilling effect?   

          By extending the vexatious litigant statute to represented 
          plaintiffs, this bill would prevent a vexatious litigant from 
          filing any new actions with or without a lawyer if a prefiling 
          order was in place.  Organizations that represent low-income 
          clients raise concerns about the possible effects of the bill 
          given that they may be testing novel legal theories to vindicate 
          an important public right.  On this point, California Rural 
          Legal Assistance Foundation and Western Center on Law & Poverty 




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          write: 

            . . . we believe that to extend this statute to counsel would 
            have a chilling effect on vindicating important rights.  Our 
            clients benefit from private attorneys willing to take their 
            cases; legal aid organizations lack the resources to handle 
            all the cases presented to them.  Sometimes they propose novel 
            legal theories, perhaps after the in pro per litigant has 
            tried and failed.  

          DOES THIS BILL HAVE A POSSIBLE CHILLING EFFECT?  COULD THIS BILL 
          CHILL LEGITIMATE ADVOCACY?
           2.Is this bill premature given that the California Supreme Court 
            is currently considering this issue?  

          Existing law provides that a vexatious litigant plaintiff may be 
          subject to a prefiling order which prohibits him or her from 
          filing any new litigation in pro per without first obtaining the 
          judge's permission in the court where the litigation is to be 
          filed.  This bill would delete the term "in pro per."  The 
          effect of this change is to provide that a prefiling order would 
          prohibit the vexatious litigant from filing any new litigation 
          whether he or she is bringing the action in pro per or is 
          represented by an attorney.

          As the sponsor notes, the recent decision in Shalant v. Girardi 
          (2010) 183 Cal. App. 4th 545, review granted, is currently under 
          review by the California Supreme Court.  In Shalant, the 
          vexatious litigant plaintiff was subject to a prefiling order 
          that prohibited him from "filing any new litigation in propria 
          persona in the courts of California without approval of the 
          presiding judge of the court in which the action is to be 
          filed."  (Id. at 549.)  While represented by counsel, the 
          plaintiff Shalant filed an action alleging, among other things, 
          breach of contract and breach of the covenant of good faith and 
          fair dealing.  Beginning about five months after the filing of 
          the case and over the next year and a half, the plaintiff was 
          represented by his original counsel, new counsel, the plaintiff 
          himself, original counsel, and the plaintiff himself, in that 
          order.  At that point, the defendants filed a notice of the 
          plaintiff's status as a vexatious litigant subject to a 
          prefiling order, and a motion to dismiss the case on that basis. 
           The trial court granted that motion, and the Second District 
          Court of Appeal reversed the ruling, holding that a prefiling 
          order issued under the vexatious litigant statute "governs only 
          the initiation of a lawsuit, not what occurs during the 




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          prosecution of the litigation."  (Id. at 554.)   

          The California Supreme Court granted review of this case to 
          decide the following question: If a vexatious litigant subject 
          to a prefiling order files a lawsuit while represented by 
          counsel, but counsel substitutes out or is otherwise relieved, 
          may the litigant proceed in propria persona without first 
          obtaining the approval of the presiding judge under Code of 
          Civil Procedure section 391.7?

          As a result, the Court will decide whether or not a vexatious 
          litigant plaintiff is in violation of a prefiling order if he or 
          she is represented by counsel at the time the litigation is 
          commenced but at some point during the litigation he or she 
          becomes self-represented.  This bill, by providing that a 
          prefiling order would prohibit a vexatious litigant from filing 
          any new litigation whether he or she is bringing the action in 
          pro per or is represented by an attorney, generally concerns the 
          issues to be decided by the Court. 

          Proponents of the bill have raised the concern that vexatious 
          litigants can "game" the system by filing an action while 
          represented by counsel, then substituting out or relieving that 
          counsel, and still proceeding with their action despite a 
          prefiling order that may be in place.  In deciding to review 
          Shalant v. Girardi, the California Supreme Court is deciding 
          just that question.  As a result, the Committee should consider 
          whether it is appropriate to approve of this measure while the 
          Court decides the matter.  

          On this point, the Consumer Attorneys of California, in 
          opposition, write that because the court "is already reviewing 
          this general issue in Shalant v. Girardi  . . .  İi]t is better 
          policy to await a decision, review that decision, and then 
          review changes if necessary."

          IS THIS BILL PREMATURE GIVEN THAT THE CALIFORNIA SUPREME COURT 
          IS CURRENTLY CONSIDERING THIS ISSUE? 

          5.   Additional support arguments  

          California Citizens Against Lawsuit Abuse (CALA) writes in 
          support of the bill, stating that the bill "will tackle the 
          ongoing issue of vexatious litigants who continually re-litigate 
          decided issues or file meritless and harassing claims.  SB 603 
          is a vehicle that will tackle the excessive and unwarranted 




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          lawsuits in our state, which have been identified as a 
          significant problem that greatly hinders the state's economy.  
          Lawsuit abuse costs Californians millions of dollars every year 
          and perpetuates a climate of fear among small business owners.  
          Consumers pay for frivolous lawsuits too.  Businesses simply 
          increase prices to cover their legal costs or they shut down 
          entirely."

          Supporter Crusader Insurance Company offers the following 
          example in support of the bill:

            One of our policyholders was recently involved in an 
            automobile accident, causing damage to a 1973 Chevy pickup 
            truck camper.  Based on our appraisal, we accepted liability 
            and promptly offered $3,993.14 for the truck's damage.  The 
            truck's owner rejected that offer and demanded payment of 
            $13,000.  Rather than provide evidence in support of his 
            demand, the truck's owner, through his counsel, threatened to 
            inflict financial hardship through various forms of litigation 
            activity, citing "You will spend over $100,000 in litigation 
            so it would be less expensive for you to simply pay $13,000 
            now."  Our company has since spent over $300,000 in defending 
            against the incessant barrage of improper filings, motions and 
            actions brought by that truck owner.  . . .  like all other 
            expenses in the business world, those defense costs will be 
            passed on to consumers; and the expense to the justice system 
            will be borne by the taxpayers. 


           Support  :  American Council of Engineering Companies; Association 
          of California Insurance Companies; California Association of Bed 
          and Breakfast Inns; California Chamber of Commerce; California 
          Chapter of the American Fence Association; California Citizens 
          Against Lawsuit Abuse (CALA); California Fence Contractors' 
          Association; California Grocers Association; California 
          Independent Grocers Association; California Hotel & Lodging 
          Association; Crusader Insurance Company; Engineering 
          Contractors' Association; Flasher Barricade Association; Marin 
          Builders' Association; Valley Industry and Commerce Association; 
          Western Electrical Contractors Association; one individual  

           Opposition  :  California Rural Legal Assistance Foundation; 
          Consumer Attorneys of California; Consumer Federation of 
          California; Western Center on Law & Poverty 

                                        HISTORY




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           Source :  Civil Justice Association of California 

           Related Pending Legislation  :  SB 731 (Committee on Judiciary), 
          which would clarify that existing law relating to vexatious 
          litigants applies to matters in the Courts of Appeal and would 
          create a process for the courts to follow when a vexatious 
          litigant seeks removal from Judicial Council's vexatious 
          litigant list, is pending in the Assembly. 

           Prior Legislation  :  

          AB 1340 (Jones, Ch. 293, Stats. 2008), provided, among another 
          things, that if a person who is not the conservatee and who has 
          previously filed unmeritorious or harassing pleadings in a 
          conservatorship proceeding, files an unmeritorious petition to 
          terminate the conservatorship intended to harass or annoy the 
          conservator, the petition is grounds for the court declare the 
          person a vexatious litigant.  

          AB 1891 (Niello, 2008), would have required a trial court to 
          order a party, the party's attorney, or both to pay reasonable 
          expenses incurred by another party as a result of any filing, 
          action, or tactic that is frivolous, clearly unjustified, or 
          otherwise substantially devoid of merit.  AB 1891 failed passage 
          in the Assembly Judiciary Committee. 

          AB 1861 (Harman, 2002), would have enacted a new "Special Motion 
          to Strike" to strike all or any part of a civil action complaint 
          based on any privileged statement, testimony, or evidence made 
          or offered at a parole hearing, if the complaint against the 
          defendant, or any portion of that complaint, is filed by a 
          plaintiff unrepresented by counsel and incarcerated as specified 
          by the bill.  AB 1861 failed passage in the Senate Public Safety 
          Committee.  

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