BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2015-2016 Regular Session
AB 54 (Olsen)
Version: May 24, 2016
Hearing Date: June 14, 2016
Fiscal: Yes
Urgency: No
NR
SUBJECT
Disability access: construction-related accessibility claims:
demand letters
DESCRIPTION
With regard to construction-related accessibility violations,
this bill would require that information about the demand letter
and the complaint be submitted to the California Commission on
Disability Access in a standard format specified by the
Commission.
BACKGROUND
Since 1969, persons with disabilities have enjoyed protection
under Civil Code
Sections 54 and 54.1, which entitle individuals with
disabilities and medical conditions to full and free access to
and use of roadways, sidewalks, buildings and facilities open to
the public, hospitals and medical facilities, and housing. After
Congress enacted the Americans with Disabilities Act (ADA) in
1990, the state made a violation of the ADA also a violation of
Section 54 or 54.1. The state protections provided to disabled
persons are comparatively higher than those provided under the
ADA and are independent of the ADA. Additionally, under the
Unruh Civil Rights Act, all persons, regardless of sex, race,
color, religion, ancestry, national origin, disability or
medical condition, are entitled to the full and equal
accommodations, advantages, facilities, privileges, or services
in all business establishments of every kind whatsoever. (Civil
Code Sec. 51.) A violation of the ADA also constitutes a
violation of Section 51.
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In 2003 and 2005, several bills were introduced after multiple
lawsuits were filed in state court by a few plaintiffs and
attorneys against business owners and operators for allegedly
technical violations of the state's access or ADA regulations.
(SB 69 (Oller, 2003), AB 209 (Leslie, 2003), AB 20 (Leslie,
2005), SB 855 (Poochigian, 2005).) Three of those bills would
have required a plaintiff to undertake prelitigation steps prior
to the filing of a complaint, including providing notice to the
owner of the property or business of the alleged violations, and
provided a specified time period for the owner or business to
cure the violations. One bill, (AB 20, Leslie, 2005) would have
precluded an action for damages for a de minimus violation,
allowing only injunctive relief and attorney's fees. All of
those bills failed passage in the Judiciary Committees of their
respective houses. In 2008, two bills were introduced relating
to disability access. AB 2533 (Keene, 2008) and SB 1766
(McClintock, 2008) would have both imposed prelitigation hurdles
on plaintiffs claiming violations of construction-related
disability access laws. Both of these bills failed in the
Judiciary Committees of their respective houses. In 2011, SB
783 (Dutton, 2011) would have established notice requirements
for an aggrieved party to follow before he or she can bring a
disability access suit and given the business owner a 120-day
time period to remedy the violation. That bill failed passage
in this Committee.
Alternatively, SB 1608 (Corbett et al., Ch. 549, Stats. 2008),
which took effect January 1, 2009, did not create any
pre-litigation hurdles for a person with a disability but
instead, among other things, provided for an early evaluation of
a filed complaint if the defendant is a qualified defendant who
had the identified place of public accommodation inspected and
determined to meet applicable physical access standards by a
state Certified Access Specialist (CASp) prior to the filing of
the complaint. In 2012, Senators Steinberg and Dutton authored
SB 1186 (Ch. 383, Stats. 2012) which sought to comprehensively
address continued issues with disability litigation.
Ultimately, the bipartisan effort was viewed as a compromise
that hoped to end the abusive litigation tactics of some
attorneys, protect the rights of disabled persons, and promote
compliance with state and federal access laws. SB 1186 created
a number of protections for small businesses and defendants who
had, prior to a claim being filed, sought out a CASp inspection.
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These protections included reduced minimum statutory damages,
early evaluation conferences, and mandatory stays of court
proceedings while the violations were corrected. That bill also
prevented the stacking of multiple claims to increase damages,
banned pre-litigation demands for money, and increased data
collection regarding alleged access violations.
Last year a number of bills were introduced to further combat
perceived issues with disability litigation. AB 1521 (Committee
on Judiciary, Ch. 755, Stats. 2015) created a new class of
plaintiff, a "high frequency litigant," upon which it imposed
additional costs and procedural burdens. Two bills, one which
created a tax credit for certain access expenditures to
businesses, and the other that would have provided funding to
the Commission on Disability Access, were vetoed by the
Governor, who stated that such legislation is more appropriately
considered in the annual budget process (SB 251 (Roth) and AB
1342 (Steinorth); see Prior Legislation below). This bill,
seeking to aid the Commission in its charge to collect and
analyze data related to construction-related accessibility
claims, would authorize the Commission to create a standard
format that attorneys would need to follow when submitting
information to the Commission.
CHANGES TO EXISTING LAW
Existing federal law , the Americans with Disabilities Act (ADA),
provides that no individual shall be discriminated against on
the basis of disability in the full and equal enjoyment of the
goods, services, facilities, privileges, advantages, or
accommodations of any place of public accommodation by any
person who owns, leases, or leases to, or operates a place of
public accommodation. (42 U.S.C. Sec. 12182.)
Existing law , the Unruh Civil Rights Act, declares that all
persons, regardless of sex, race, color, religion, ancestry,
national origin, disability or medical condition, are entitled
to the full and equal accommodations, advantages, facilities,
privileges, or services in all business establishments of every
kind whatsoever, and entitles persons to $4000 minimum statutory
damages for violations of Unruh. (Civ. Code Sec. 51 et seq.)
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Existing law provides that individuals with disabilities or
medical conditions have the same right as the general public to
the full and free use of the streets, highways, sidewalks,
walkways, public buildings, medical facilities, including
hospitals, clinics and physicians' offices, public facilities,
and other public places. It also provides that a violation of
an individual's rights under the ADA constitutes a violation of
state law. (Civ. Code Secs. 54, 54.1.)
Existing law provides that a violation of the ADA also
constitutes a violation of Sections 54 or 54.1, and entitles a
prevailing party to recover reasonable attorney's fees. (Civ.
Code Sec. 55.)
Existing law prohibits a demand letter from including a request
or demand for money or an offer or agreement to accept money,
unless the claim involves a physical injury and special damages,
and provides that a violation of this provision constitutes
cause for attorney discipline. (Civ. Code Sec. 55.31.)
Existing law requires an attorney who serves a demand letter
upon a defendant to, within five business days, submit a copy of
the demand letter to the California Commission on Disability
Access. (Civ. Code Sec. 55.32.)
Existing law requires an attorney who files a complaint to
submit a copy of the complaint to the Commission within five
business days, and requires that the attorney notify the
Commission of any settlement, judgment, or dismissal, as
specified. (Civ. Code Sec. 55.32.)
This bill would require an attorney serving a demand letter or
complaint to send a copy to the Commission and submit
information in a standard form specified by the Commission.
COMMENT
1.Stated need for the bill
According to the author:
AB 1521 was created to set up a database of high-frequency
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litigants to "crack down" on individuals filing frivolous
claims. Requiring the complaint letters to be sent in a
standard format was going to make it easier for the Commission
on Disability Access to quickly review the letters and quickly
identify who was abusing the legal system. However, the
standardized format requirement doesn't take effect until
2019.
AB 54 "fills in the gap." Rather than waiting until 2019, this
law will take effect so that the demand letters will be
required to be sent in a standardized format developed by the
Commission.
2.Increased data collection helps the Legislature evaluate
allegations of predatory practices
Existing law requires attorneys who serve demand letters and/or
file complaints alleging violations of any construction-related
accessibility standard, to send a copy of the letter or
complaint to the California Commission on Disability Access
(Commission) within five business days of sending or serving the
letter or complaint on the defendant. Additionally, the attorney
must notify the Commission of any judgment, settlement, or
dismissal of the claim or claims alleged in the complaint within
five business days and provide the Commission with the following
information: (1) the date of the judgment, settlement, or
dismissal; (2) whether or not the violations alleged in the
complaint were remedied after the plaintiff filed a complaint;
and (3) if the violations alleged in the complaint were not
remedied, whether or not another favorable result was achieved.
In 2015, the Commission released a report indicating that of the
5,392 access-related complaints filed between September 2012 and
October 2014, 54 percent of the cases were filed by two law
firms, and 14 plaintiffs were involved in 46 percent of the
cases. That report was used to support the need for a number of
bills seeking further reform of construction-related access
litigation. This bill, which would allow the Commission to more
efficiently process data, will arguably help ensure that
lawmakers have access to up-to-date and accurate information in
evaluating legislation related to disability access.
3.California Commission on Disability Access has limited
resources
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As noted above, despite significant legislation, the business
community continues to call for action to curb the allegedly
predatory practices of a handful of attorneys. In seeking to
better understand the issues related to serial
construction-related accessibility litigation, a number of bills
have called for increased data collection, analysis, and
reporting by the California Commission on Disability Access
(Commission). Beginning with SB 1186 (see Background) the
Commission has routinely been charged with new responsibilities.
SB 1186 provided that "a priority of the Commission shall be
the development and dissemination of educational materials" to
promote and facilitate disability access, and required the
Commission to create educational materials and toolkits and to
make those items available on its Internet Web site. SB 1186
also called for increased data collection, required that the
data be reported to the public, and additionally created annual
reporting requirements to the Legislature. This year, two bills
(SB 269 (Roth) and AB 2093 (Steinorth)) would further require
the Commission to develop and/or educate the public about
resources and educational materials related to disability
access, and SB 1407 would require the Commission to begin
collecting and analyzing data on disability access litigation
brought against public entities.
The Commission currently employs only four staff members: an
executive director, two program analysts, and an office
technician. Supported largely by volunteers that input data,
the Commission has continuously satisfied the new
responsibilities assigned by the Legislature. This bill, which
would authorize the Commission to designate a "standard format"
by which attorneys must submit information related to demand
letters and complaints, could arguably reduce (if not eliminate)
the onerous task of data entry, thereby allowing the Commission
to spend its limited resources instead on analyzing data and
creating educational materials.
4.Disciplinary action for non-compliance
Regarding disability access litigation, existing law requires an
attorney who provides a demand letter and/or serves a complaint
to submit a copy of the letter or complaint, along with other
related information, to the Commission on Disability Access
(Commission) within five business days, as specified. Failure to
submit the required copy and/or information "shall constitute
cause for the imposition of discipline of an attorney where a
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copy of the complaint, demand letter, or notification of a case
outcome is not sent to the California Commission on Disability
Access within five business days, or a copy of the demand letter
is not sent to the State Bar within five business days. In the
event the State Bar receives information indicating that an
attorney has failed to send a copy of the complaint, demand
letter, or notification of a case outcome to the California
Commission on Disability Access within five business days, the
State Bar shall investigate to determine whether [this
requirement] has been violated." (Civ. Code Sec. 55.32.)
Thus, failure to submit the requisite information and documents
within five business days subjects an attorney to disciplinary
action by the State Bar which could negatively affect an
attorney's career. Furthermore, the Commission has noted that
because of its limited resources (see Comment 3 above), law
firms that wait to submit information to the Commission until
they have acquired a large batch, are not only potentially in
violation of the law, but often jam the data entry process and
make it difficult for the Commission to properly staff its
office with volunteers.
Staff notes that because this bill would allow the Commission,
at any time after January 1, 2017, to determine the format in
which attorneys must submit specified information, and that
failure to comply with that format could result in disciplinary
action, it is imperative that attorneys receive adequate notice
as to any changes in required format. This bill, as amended on
May 24, 2016, requires that the Commission post any "standard
format" by which it wishes to receive information on its
Internet Web site 30 days prior to that format being required,
and would additionally require the Commission to clearly post
the date the new format would need to be followed. This will
arguably ensure that attorneys who are seeking, in good faith,
to comply with the law will have adequate notice and afford them
the time to update their internal processes to reflect the
format specified by the Commission.
Support : California Grocers Association; California Small
Business Association; Civil Justice Association of California
Opposition : None Known
HISTORY
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Source : California Commission on Disability Access
Related Pending Legislation :
SB 269 (Roth, 2016) is substantially similar to SB 251 (see
below), with the exception of the tax credit, which the author
removed to address the Governor's concerns. This bill is
currently in the Assembly Appropriations Committee.
SB 1142 (Moorlach) would have established notice requirements
for an aggrieved party to follow before he or she can bring a
disability access suit and would have given the business owner a
120-day time period to remedy the violation. The bill would
have also provided that in the event of any difference between
the ADA and state law, that the ADA controls. This bill failed
passage in the Senate Judiciary Committee.
SB 1406 (Mendoza) would require an attorney who sends or serves
a complaint alleging a construction-related accessibility
violation against a public entity to send a copy of the
complaint and submit the notification of judgment, settlement,
or dismissal to the California Commission on Disability Access,
as specified.
Prior Legislation :
AB 52 (Gray, 2015) would have provided that the defendant's
maximum liability for statutory damages in a
construction-related accessibility claim against a place of
public accommodation is $1,000 for each offense if the defendant
has corrected all construction-related violations within 180
days of being served with the complaint. This bill was never
heard in the Assembly Judiciary Committee.
AB 1230 (Gomez, Ch. 787, Stats. 2015) establishes the California
Americans with Disabilities Act Small Business Compliance
Finance Act to provide loans to assist small businesses to
finance the costs of projects that alter or retrofit existing
small business facilities to comply with the federal Americans
with Disabilities Act.
AB 1342 (Steinorth, 2015) would have provided additional revenue
to the California Commission on Disability Access. This bill
was vetoed by Governor Brown who stated that it was "something
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more appropriately addressed in the annual budget process."
AB 1468 (Baker, 2015) would have provided that a public entity's
possession of a close out letter from the State Architect
certifying that the buildings, facilities, and other places meet
the applicable construction-related accessibility standards of
the federal Americans with Disabilities Act, serves as
presumptive evidence of compliance with the federal Americans
with Disabilities Act. This bill was never heard in the
Assembly Judiciary Committee. See Background; Comments 2, 4, and
6.
AB 1521 (Committee on Judiciary, Ch. 755, Stats. 2015) See
Background.
SB 67 (Galgiani, 2015) would have limited recovery against a
small business for construction-related accessibility claims to
injunctive relief and reasonable attorney's fees, and would
allow businesses who have undergone a CASp inspection 120 days
to correct violations in order to qualify for reduced statutory
minimum damages. This bill was never heard in the Senate
Judiciary Committee.
SB 251 (Roth, 2015) would have made various changes to access
laws, including: exempting a defendant from liability for
minimum statutory damages if corrections were made within 120
days of receiving a CASp report; requiring the State Architect
to publish a list of CASp inspected businesses; and providing a
tax credit for elibible access expenditures, as specified. This
bill was vetoed by Governor Brown who argued that tax credits
are more appropriately addressed in the annual budget process.
SB 1186 (Steinberg and Dutton, Ch. 383, Stats. 2012) reduced
statutory damages and provided litigation protections for
specified defendants who timely correct construction-related
accessibility violations of the Unruh Civil Rights Act. That
bill also banned prelitigation "demands for money" and created
rules for demand letters and complaints in claims involving
construction-related accessibility violations.
AB 2282 (Berryhill, 2012) would have authorized an aggrieved
person to bring a disability access suit only if: (1) the person
has suffered an injury in fact; (2) the injury in fact was
caused by the violation; and (3) the violation is redressable,
was held under submission in the Senate Appropriations
Committee.
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AB 1878 (Gaines, 2011) which is substantially similar to SB 1163
but applies to "microbusinesses," defined by the bill, failed
passage in the Assembly Judiciary Committee.
SB 1163 (Walters, 2012) would have established notice
requirements for an aggrieved party to follow before he or she
can bring a disability access suit and would have given the
business owner a 120-day time period to remedy the violation.
If the property owner cured the violation, this bill would have
prohibited the plaintiff from receiving any damages or
attorney's fees, except for special damages. This bill failed
passage in this Committee.
SB 783 (Dutton, 2011), which was identical to SB 1163, failed
passage in this Committee.
SB 384 (Evans, Ch. 419, Stats. 2011) clarified that attorneys
who file complaints or send demand letters related to disability
access violations must provide a written notice of legal rights
and obligations whether or not the attorney intends to file an
action in state or federal court.
SB 209 (Corbett & Harman, Ch. 569, Stats. 2009) required a CASp
inspection report to remain confidential rather than be under
seal and subject to protective order.
SB 1608 (Corbett et al., Ch. 549, Stats. 2008) See Background;
Comment 6.
SB 1766 (McClintock, 2008) See Background.
AB 2533 (Keene, 2008) See Background.
SB 855 (Poochigian, 2005) See Background.
Prior Vote :
Assembly Floor (Ayes 78, Noes 0)
Assembly Appropriations Committee (Ayes 17, Noes 0)
Assembly Judiciary Committee (Ayes 9, Noes 0)
Assembly Rules Committee (Ayes 11, Noes 0)
Assembly Judiciary Committee (Ayes 10, Noes 0)
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