CJAC keeps pressure on Calif. Legislature for tort reform

Legal News Line Feb. 19, 2009, 5:00pm

John Sullivan

SACRAMENTO, Calif. (Legal Newsline) - Hearing news that Democratic Assembly Speaker Karen Bass has formed a task force to develop strategies to spur economic growth, the Civil Justice Association of California continue to pressure lawsuits to enact tort reform that would entice businesses to move to California.

The group offered praise to Bass, D-Los Angeles, for her prioritizing economic growth on Thursday, the same day the state Senate broke a months-long deadlock and passed a revised budget that will shore up the state's projected deficit of $42 billion.

"With a budget solution agreed upon, there is no time to lose in enacting specific changes to send a genuine message nationally that California is going to be a better place to do business and hire workers," CJAC President John Sullivan said.

But CJAC's solutions may differ from those of the Democratic caucus. The organization has mounted continued pressure on state leaders to enact tort reform that it says would balance the courts and help dispel the notion that California's plaintiff friendly courts is hostile to businesses.

Most tort reform professionals believe that Democrats, fueled by donations from plaintiffs' attorneys, are hostile to tort reform legislation. California is routinely ranked among the worst business "hellholes" in an annual report put out by the American Tort Reform Association.

Attorney General Jerry Brown is known as one of the country's more aggressive AGs in suing businesses for treatment of workers, environmental abuses and other financial issues.

Sullivan said he sent Assemblyman Manuel Perez, who will lead the Assembly Stimulus, Economic Recovery, and Jobs Task Force, information on four statutory changes in civil litigation that would help send a national signal that California wants to treat businesses fairly.

"To say business planners across the country have been getting an opposite message is a vast understatement," he said.

The legal changes CJAC is promoting include improving the state's unbalanced class action law, encouraging mediation and arbitration, removing penalties on defendants hoping to appeal decisions, and bringing realistic clarity to employee meal and rest break rules.

Sullivan sent letters earlier in the week to legislators advocating a bill authored by Assemblyman Van Tran, R-Costa Mesa, which allows defendants an equal opportunity to appeal a judge's decision to certify a class action.

"California's class action law creates an unbalanced and unfair legal climate in this state. With our current economic crisis, we need to take steps that create a positive business environment and help California's economic recovery," Tran said in a press release issued by the organization.

Sullivan sent a similar letter to Republican Gov. Arnold Schwarzenegger late last year.

Sullivan mentioned a recent opinion story in the Wall Street Journal that said the state's economic troubles stem from two decades of overspending, over-regulating and overtaxing businesses. It took particular issue with new sales and income tax increases that will cost the state business support.

"The tragedy..." the story states, "is that the political class still won't address the root cause of its financial problems, which is that the state is becoming less economically competitive... It's no surprise that most CEOs we talk to, many of whom live in California, say they'd be foolish to build another plant in the state," one that suffers from "runaway liberal governance."

Sullivan said the reforms his organization is touting are less "splashy" than tax issues and other hot-button topics, but they will "be recognized by business decision-makers. These are the people who in preparing for economic recovery will decide how many personnel and facilities to add or retain in California, if any, and how much to develop in a different state," a press release issued by CJAC stated.

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