Archived: Congressman Challenges 'Predatory Lawsuits' Exploiting ADA

By Frank Kineavy

Rep. Jerry McNerney (D)

New legislation has been introduced in California in response to a number of lawsuits from “high-frequency litigants” that are exploiting the Americans with Disabilities Act (ADA) to hurt small businesses.

Since George H. W. Bush signed into law the ADA in July 1990, millions of dollars have been rewarded to plaintiffs with disabilities at the expense of small businesses that can’t afford to keep up with the ADA’s constant revisions. So California Representative Jerry McNerney (D) is fighting for those small businesses that are suffering the unintended consequences of the landmark ADA bill. The second-term congressman claims certain plaintiffs are abusing the landmark bill to seek personal gains.

While the bill is known for ensuring accessibility and activity for people with disabilities, including entrance to public buildings and educational opportunities, it does contain some strict regulations that often could be strenuous on a typical American “Mom and Pop Shop.” McNerney’s bill would not give small businesses a free pass on ADA compliance but rather allow them time to meet the required standards without immediately entering financial hardship.

“I have heard from numerous local businesses who were forced to shut down, lay off employees, pay out large settlements, or change locations because of repeated lawsuits and threats of lawsuits that leave these businesses with little to no financial resources or time to fix the problem and become compliant,” McNerney said.

California makes up 12 percent of the United States population, yet 40 percent of all ADA cases are filed in the state. That is why McNerney has introduced H.R. Bill 4719, also known as the COMPLI Act (Correcting Obstructions to Mediate, Prevent, and Limit Inaccessibility). This act will require potential plaintiffs to notify the business of the exact ADA violation, giving the business owner a 90-day period to comply fully with the ADA before a lawsuit can be filed. In certain cases, a business will also be granted a 30-day extension if they make their best effort to comply with the violation but are unable to within 90 days. This “good faith” section of the bill allows for the extension if a business has obtained the proper permits to start necessary construction, has hired contractors and received an estimate for their services or has started construction and made every effort possible to ensure the project is complete as quickly as possible.

Several businesses in McNerney’s jurisdiction were overwhelmed with complaints that the congressman says are unfounded and fraudulent. “A handful of bad actors have taken advantage of the law just to make money,” he explained at a press conference. One individual in particular is responsible for over 150 lawsuits filed against California small businesses in the past five years. Cecil Shaw has made a career out of using his disability to exploit capitalists and reap the rewards against older local establishments out of date with the ADA’s ever-changing regulations. McNerney feels that people like Shaw “have no intention of entering and enjoying a business.”

Shaw and others make a career out of filing these damaging lawsuits. According to the California Commission on Disability Access, more than half of all ADA accessibility claims in the state were from just two law firms — and a little less than half of them came from just 14 plaintiffs.

Assemblymember Kristin Olsen (R-Modesto), who co-authored a Senate Bill that would also give businesses extra time to comply with ADA regulations, said, “It is crucial that leaders at both the state and federal level continue to work together to pass policies that strike a balance between the need to ensure access to public and private buildings with the need to protect businesses from predatory lawsuits.”

Businessmen like Gary Burton have been handcuffed by the debilitating accusations people like Shaw have filed against establishments such as his family shop, Diamond Luxury and Cleaners. As Burton tries to keep his 94 year-old mother’s dream open, he is swamped with legal fees, a $7,000 settlement and the cost of painting in handicapped parking spaces outside his business.

“I probably won’t be in business that long,” Burton said. “Another two years to comply That’s fine, but I don’t know if it’s worth it or if I can afford to keep subsidizing this. I just wish someone pointed it out to me before taking me to court. I thought I was grandfathered in.”

Shaw is one of many to exploit small businesses for ADA violations, and for most of these businesses, they are forced to close permanently to avoid tens of thousands of dollars in settlement costs — an unintended consequence of the ADA, which has also been extremely helpful for people with disabilities.

“As someone who has used a manual wheelchair for the past 17 years, I understand and appreciate the significance of the Americans with Disabilities Act,” said Rachelle Golden, an ADA defense attorney. “However, as a defense attorney I understand that the ADA is severely abused and has become a money making scheme for a small handful of attorneys and serial plaintiffs.”

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