Tuesday, October 16, 2012

California City Pays Serial Litigant $15K Not to Sue the City or Any Business Within It

As all three of my blog's readers know (I have it on good authority I picked up a third reader!  Yay!), I have taken an "anti-anti-" position on serial ADA public accommodations litigation.  I understand the frustration that many business owners express about individuals with disabilities and their lawyers who go into a town and sue dozens of inaccessible businesses at a pop before moving on to the next town and doing it again.  But to focus one's criticism on the serial litigators, I have argued, misses two key points: (1) serial litigation wouldn't work if so many businesses didn't still fail to comply with the ADA, a law that is now more than 20 years old; and (2) the remedial structure of the ADA's public accommodations title encourages serial litigation.  In a very large swath of cases (perhaps the overwhelming majority of those cases), serial ADA public accommodations litigators are suing businesses that are actually in violation of the statute.  And whatever one might think of the attractiveness of the tactic of suing lots of businesses at once, the prospect of being sued by a serial litigator does place an incentive on businesses to get educated about the ADA and get into compliance. That is why I've generally opposed efforts to limit serial ADA litigation.

But I have no tolerance for serial litigation that does not advance compliance with the ADA -- litigation that does not contribute to making businesses more accessible.  Which brings me to the following story, which begins:

George Louie is a West Sacramento man who has sued hundreds of Northern California cities and businesses for failing to comply with the federal Americans with Disability Act. 
This week, Yuba City announced it has agreed to pay Louie $15,000 to leave the city and its businesses alone for good. 
"He's agreed not to file ADA lawsuits in our city, period," said Darin Gale, Yuba City's economic development manager. "There's no timetable, it's forever." 
The agreement, which Yuba City officials say is the first of its kind, has many business owners in the Sutter County town drawing a sigh of relief.

Read more here: http://www.sacbee.com/2012/10/13/4907961/yuba-city-pays-man-not-to-file.html#storylink=cpy

I understand why the city would pay $15,000 if it would get this plaintiff to go away, but a $15,000 bounty, paid for by the city, does absolutely nothing to incentivize business owners to improve accessibility or comply with the law.  Indeed, the promise never to file an ADA lawsuit against the city or businesses within the city, at any point in the future -- even for violations that haven't yet occurred -- undermines incentives for compliance.  Indeed, to the extent that the agreement covers claims that haven't yet arisen (because there is no violation yet or Mr. Louie hasn't yet encountered or learned of the violation), it is likely unenforceable.  See 14 Penn Plaza LLC v. Pyett, 556 U.S. 247, 265 (2009) (reaffirming "that [substantive] federal antidiscrimination rights may not be prospectively waived").  But even to the extent that the agreement is enforceable, it seems to me quite discreditable.

By the way, California's recent anti-serial-litigation legislation will do virtually nothing to stop conduct like this.  It will, to be sure, prohibit plaintiffs' lawyers from placing a request for money in a demand letter (likely a First Amendment violation), but it won't stop defendants from offering, and plaintiffs from accepting, settlements like this.  And it won't stop defendants from asking plaintiffs what it will take to get them to go away, and plaintiffs from responding by saying, "Give me the Louie v. Yuba City deal."  Nor, as Julia Campins recently pointed out, should the other provisions of the new legislation stop cases like this.  The legislation will have real effects on legitimate litigation, but it won't address the real problem that this case illustrates.

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