BILL ANALYSIS
AB 568
Page 1
Date of Hearing: May 20, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 568 (Lieu) - As Amended: May 5, 2009
Policy Committee:
JudiciaryVote:10-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill establishes that nonresidential property used for the
manufacture, sale, or knowing possession of counterfeit goods
constitutes a nuisance and authorizes various public and private
remedies, including injunctions, abatement orders, and unlawful
detainer actions, to abate and prevent the nuisance.
Specifically, this bill:
1)Provides that a district attorney, county counsel, or city
attorney, may enjoin the person conducting or maintaining the
nuisance, as described above, and the owner, lessee, or agent
of the building from maintaining or permitting the nuisance.
2)Provides that a prosecutor may bring an action for unlawful
detainer against any person who engages in or maintains the
nuisance. Also specifies that prior to filing the unlawful
detainer action, the prosecutor must give the owner 30-days
notice, requiring the owner to file an action for removal of
the person engaged in or maintaining the nuisance. If the
owner fails to bring the unlawful detainer within 30 days,
then the right to bring the unlawful detainer shall be
assigned to the prosecutor.
3)Provides that in any unlawful detainer action brought pursuant
to the above provisions, a court may, upon a showing of good
cause, issue a partial eviction ordering the removal of
persons engaging in the nuisance activity, but allowing
innocent tenants to remain.
4)Provides that a court may order closure of the premises under
certain circumstances, and if it does the court may order the
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party seeking the closure to provide relocation assistance to
displaced tenants, as specified.
5)Makes a violation or disobedience of an injunction or order
for abatement punishable as contempt of court and a fine of
$500 to $10,000 and/or six months in county jail.
6)Provides that the court may assess a civil penalty not to
exceed $25,000 against any or all of the defendants, based on
the severity of the nuisance and its duration.
FISCAL EFFECT
Potential nonreimbursable costs to local governments for
prosecution and incarceration, offset to some extent by fine
revenues.
COMMENTS
1)Background . According to a 2007 report of the Los Angeles
Economic Development Corporation (LAEDC), counterfeit and
pirated goods are sold every day in Los Angeles in plain site.
Pirated and counterfeit CDs, DVDs, computer software, and
clothing and fashion accessories are openly sold on city
streets, at flea markets and swap meets, and, increasingly, in
commercial storefronts that appear to sell legitimate brand
name items. The report, based on 2005 data, noted that the
nine economic sectors most vulnerable to piracy and
counterfeiting represent about one-quarter of the total
employment in Los Angeles County. According to the report and
the claims of several of the supporters of this bill, the
annual costs run into billions of dollars in lost profits,
tens of thousands of lost jobs, and a half-million dollars in
lost sales tax revenue in the City and County of Los Angeles
alone.
Although existing law provides criminal sanctions for the
counterfeiting of trademarked goods, this bill's author and
sponsor-the Los Angeles County District Attorney's
Office-claim that "these sanctions have proven ineffective in
discouraging business owners from permitting the continued use
of their premises for the manufacture, distribution, and sales
of pirated goods." In order to supplement the usual criminal
sanctions against the perpetrators of the crimes, the sponsor
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seeks additional tools that will allow local authorities to go
after the property owners who permit the illegal activity to
continue on their premises. In short, by proclaiming that
premises used for the manufacture and sale of counterfeit
goods are a nuisance, this bill would make it easier for local
authorities, and even private citizens, to obtain injunctions
and abatement orders against the persons conducting, and
property owners permitting, the unlawful activity. In order
to better effectuate this goal, the measure would also permit
a district attorney, county counsel, or city attorney or
prosecutor, to file an action for unlawful detainer against
any person who engages in the nuisance or permits it to occur.
(The most recent amendments narrow the bill to apply only to
nonresidential property.)
This bill is modeled on Health & Safety Code Section 11570 et
seq., the state's narcotics nuisance abatement pilot project,
which allows local authorities to take aggressive abatement
and unlawful detainer actions against properties that are used
for illegal drug activity. More recently legislation has
extended the nuisance abatement and unlawful detainer
combination to combat the illegal sale and possession of
weapons and ammunition. (An unlawful detainer is a special
proceeding by a landlord to regain possession of real property
from a tenant, such as when a tenant fails to pay rent for an
apartment. The procedure for an unlawful detainer case is
prescribed by statute, and designed to provide an expeditious
means for a landlord to regain possession when a tenant
wrongfully refuses to leave. The underlying goal is to promote
peaceful resolution of landlord-tenant disputes.)
2)Opposition . The American Civil Liberties Union (ACLU) opposes
this bill because, by creating an entirely new "public or
private nuisance," it will allow government to deprive persons
and businesses of property rights without obtaining a
conviction. Moreover, ACLU argues that, while counterfeiting
may be unlawful, it does not constitute a nuisance to tenants
or neighbors in the same manner as prostitution, illegal
drugs, and illegal weapons. "By extending the 'public
nuisance' designation to counterfeiting and sales," the ACLU
persuasively concludes, "it is hard to imagine which illegal
activities could not be considered a public nuisance."
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081