FOR IMMEDIATE RELEASE
April 27, 2000

CONTACT: John H. Sullivan
Barbara Wheeler
PHONE: (916) 443-4900

MAYDAY! MAYDAY!
California Businesses in Danger From Attorney-Fees Machine

SACRAMENTO - "It's time the Legislature protects businesses from attorneys who are using the law to leverage settlements that produce little more than attorney fees," said John H. Sullivan, president of the Civil Justice Association of California (CJAC).

The Association is sponsoring a bill (AB 2186 - Robert Pacheco) that would require private lawyers to have a bona fide client who has actually been injured before they can sue a business under the state Unfair Competition Law (UCL). The bill is scheduled to be heard by the Assembly Judiciary Committee on May 2. The bill's author, Assemblyman Robert Pacheco (R- Walnut), and co-author, Senator Bill Morrow (R- Oceanside) will review the legislation at a press briefing on Monday May 1, in Room 1190 at 10:00 a.m.

"Right now," Sullivan said, "the law lets a business be targeted with a lawsuit whenever a lawyer decides it may produce some fee money. How else can you explain a San Diego lawyer, without an identified client, suing a Silicon Valley online golf retailer for not listing the manufacturing site of clothing offered on its web site?"

The Unfair Competition Law has been on the books for years, protecting consumers and businesses from companies that try to win a commercial edge by breaking sales and advertising laws. It has been effectively used by district attorneys Ü a practice the Civil Justice Association does not want to curtail.

Unfortunately, some private attorneys have been using the law as a low grade substitute for class action lawsuits. The lawyers claim to be suing on behalf of consumers, but don't have to tell consumers about the lawsuit. Not only does this leave people without any say in a case filed on their behalf, but it leaves defendant companies without protection from repeated lawsuits over the same activity. The proposed law would prevent this abuse.

Lawyers have also been adding Unfair Competition Law allegations to lawsuits brought on other grounds, sometimes to evade lawsuit filing deadlines and other times to increase the economic threat to the defendant and squeeze out bigger settlements. Supreme Court Justice Janice Brown has described the law as a "standardless, limitless attorney-fees machine." And the state's plaintiffs' lawyer association has held a seminar on how the law "can be a value-added component of your litigation."

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