Public Interest Lawsuits in Danger

A right you probably didn’t know you had is in danger in Cally-Fornia.

A well funded group of businesses, the kind of businesses that have reputations for ripping off their customers, has managed to get an initiative on the ballot that will prevent private citizens from suing them under California Business and Professions Code 17200.

As things stand right now, if you or I notice that a business is in violation of law, we can bring a lawsuit against the company for an unfair business practice even if we are not directly harmed by the company’s actions.

This is a very powerful tool, and one that the California Chamber of Commerce doesn’t want you to have. The car dealers, banks, insurance companies, and telephone companies would rather you wait for the District Attorney or the Attorney General or the Federal Trade Commission to take action.

These companies do not want you to have this power.

I worked for a number of years as an investigator for a major Southern California District Attorney’s Office Consumer Affairs Division. There are thousands and thousands of good solid cases of unfair business practices out here that will never be investigated by any governmental agency. They don’t have the resources, and the District Attorney is an elected official who will not go after his corporate contributors.

The backers of the proposition claim that the law is being abused. And they are correct. There have been entire operations run by unscrupulous attorneys who have basically blackmailed businesses by bringing 17200 actions for essentially technical violations of the law.

However, these folks have been prosecuted by the Attorney General and others, and many of these operations have been shut down. The District Attorneys and Attorney Generals understand that the credibility of the consumer law is endangered by abuse of the system.

There have also been cases of mom and pop stores being sued for selling tobacco to minors brought by some over enthusiastic anti-smoking advocates. This practice, too was stopped by the authorities.

The answer to this kind of abuse is not to toss out the law, and give up the right to go after these businesses, but to go after those who abuse the consumer laws.

The advocates of this repeal have millions of dollars. The opponents of this propostion have several hundred thousand dollars.

Read more about it here.

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