ADA, Not ATM

Guest post written by attorney David Warren Peters, with California Justice Alliance, APC.  Mr. Peters’ comments expressed herein are his personal views and not necessarily those of Citizens Against Lawsuit Abuse, California Justice Alliance, APC, or any other organization in which he may be involved, and should not be relied upon as tax, design or legal advice.

Every summer, Sick of Lawsuits focuses on how lawsuit abuse and the inappropriate use of certain litigation claims and tactics can hurt small businesses across the country. I wanted to draw attention to one type of lawsuit that is increasingly being filed throughout the United States and can have a devastating impact on the many small and family-run businesses that are increasingly the targets of these claims — lawsuits brought under the Americans with Disabilities Act of 1990 (the “ADA”).  Most would agree that the ADA is a very well-intentioned law, designed to open doors so that people with disabilities could have meaningful access.  However, certain trial lawyers and frequent filers seem to be using these noble laws for purely financial gain, without obtaining changes which might be needed or required, or any enforceable agreement to make them — provided a suitable financial settlement is quickly paid.

Small and family-run businesses tend to be a particularly common target of these actions, in some cases because they lack the financial resources for access to justice, so those involved will often perceive little choice but to pay a financial settlement to “stop the bleeding” even if the claims might ultimately not be successful at trial.  California was one of the first jurisdictions to see individuals become multimillionaires from filing these claims. In some instances, most if not all businesses on a given street were named as defendants by the same lawfirm or plaintiff.  Regrettably, some attorneys seem to be targeting individuals with a particular ethnic heritage, or with limited English language ability, because they are assumed to have a greater inclination to pay a “nuisance value” settlement just to stop the litigation.

California Citizens Against Lawsuit Abuse documented that 180 small businesses in Fresno alone had been sued on ADA violations and that almost 80 percent of these suits were against minority-owned businesses. This would not be difficult to believe and would be consistent with situations we’ve seen in other communities. For years, we have seen such businesses lay off employees and cut community support just to cope with the litigation or settlement expense. In poorer areas, we have seen as much as a year’s net income of a small business defendant go to plaintiffs who later had no awareness of the claims their attorney had made.  ADA laws were meant to make businesses more accessible – not run them into the ground.  We have received countless reports of lawyers who use all but identical suits substituting only the names and addresses to file hundreds of lawsuits over a matter of weeks without ever paying the filing fees, even though they receive millions of dollars in settlements from those claims.

In Florida, second only to California in the explosion of ADA lawsuits, a cottage industry of ADA filers has emerged. Concentrated in South Florida and Broward, Palm Beach, and Miami Dade counties, a small number of serial filers have been targeting local businesses with lawsuits. It’s the same story: lawsuits appear to be filed to squeeze payments out businesses– not truly to improve access. The state is also home to lawsuit mills like those in California, which can churn out up to 20 lawsuits per day.  New York and Hawaii report similar developments.  New lawyers and plaintiffs seem to enter the market every day, and there is no practical limitation on the maximum number of lawsuits which can be filed in a given jurisdiction, or against a particular business (even if it is in the process of making changes).

Despite the vast increase in the number of lawsuits with ADA claims, legislators have been slow to consider reforms which could both increase access and reduce the potential for abuse.  Many of the offices of the plaintiffs’ attorneys in these cases, and the legislators who oppose reforms, have the very same conditions mentioned in these lawsuits, which calls the sincerity of their positions into question.

As we continue to wait for meaningful reforms, small business should quickly get accurate information about changes which may need to be made at their locations (see ADA.gov for some, but certainly not all information which might be needed).  If you are concerned about the potential for abuse of these claims, you should talk to your legislator about the need for change.  If you see inappropriate use being made of these truly noble and well-intentioned laws, you should report it to Citizens Against Lawsuit Abuse (CALA) so that they can direct additional attention to the issue.  Together, we can all work towards a solution that stays true to the original goal of the ADA – providing access for people with disabilities – not an ATM for trial lawyers.