The law, overwhelmingly approved by the Legislature (Assembly Bill 1394 - Figueroa and Escutia), is already saving manufacturers thousands of dollars in legal defense costs.

"The money saved by this bill is dramatic," said John H. Sullivan, president of the Civil Justice Association of California, which co-sponsored the legislation. "For example, every one of the 1,500 makers of retailer software in the state was vulnerable to these extortionate lawsuits. If each had been hit and forced to defend themselves without the help of this new law, the combined cost could have easily hit $100 million! Add to this the costs avoided by other kinds of manufacturers being hit with these suits and the savings is quite remarkable.

"These are costs that would have been passed to consumers. The caseload would have uselessly burdened the courts."

Software makers across California had been hit with lawsuits demanding $1 million each because their retail packages were "too large" for the disks and printed instruction booklets they contained. Dozens of similar suits were also filed against cosmetic and soap manufacturers. A lawyer could bring these cases without even having a client claiming damages.

Dismissals of existing cases have already begun in some courts. The new legislation is based on guidelines that district attorneys have been using to determine when packaging should be challenged as misleading.

Sullivan noted that district attorneys still will be able to crack down on fraudulent packaging and protect consumers.

"This bill will prevent private attorneys from using the law primarily to generate income," he said.