Michael Arnold Glueck, M.D., and Robert J. Cihak, M.D.
Thursday, May 20, 2004

Unfortunately some of the really bad stuff the California trial lawyers do leads the way for the rest of the nation - so consider this a "heads-up" to mount your defenses!

Let us draw your attention to legislation that paints a target on every business in California as fair game for frivolous multi-million dollar lawsuits. Fortunately, concerned lawmakers along with Governor Schwarzenegger are calling on the Legislature to immediately repeal Senate Bill 796 also known as the "Sue Your Boss" bill.

This lethal bill, SB 796, is sure to be a deathblow to businesses by increasing the employee incentive to file frivolous lawsuits against their employer. There's no requirement in the bill that the employee actually be harmed. As a result, litigation against employers will increase, giving employers incentive to move their businesses out of the state.

Under SB 796, an employee, including a state employee, could file a civil lawsuit for tens of millions of dollars for the most minor violation, including not having current posters, not having the correct font size on posters, and failure to post elevator permits.

For example, the civil penalty for just one elevator permit violation over a three year period could be as high as $17.8 million. Companies may be forced to reduce employment, cut benefits or reduce dividends to pay for these frivolous lawsuits. There's also potential to lose millions of dollars in tax revenue as California companies cut jobs or locate to other states to avoid these frivolous lawsuits.

Legislation introduced to repeal the law (AB 2181) has been introduced by Assemblyman John Campbell with the support of Governor Schwarzenegger, but was voted down earlier this month as expected on a party line Democratic trial lawyer controlled vote. It is to Campbell's credit that he has the courage to fight for the people and their jobs - but it is time the electorate takes notice, stands up and gives him some help.

So why won't the Legislature repeal a bad law? The simple answer is $62 million that personal injury lawyers see as theirs because of the millions of dollars they have given to legislators in campaign contributions. Now they want their payoff.

According to Assemblyman Campbell, a brief inspection of the California Capitol offices revealed 14 separate violations that could subject the State to a $249 million lawsuit. As required by statutory law, personal injury lawyers will earn 25 percent of that amount totaling $62 million.

Little wonder the personal injury lawyers are so opposed to repealing the "sue your boss bill." They stand to make millions in filing frivolous lawsuits under it. Author (and former trial lawyer made rich), Senator Joe Dunn (D-Santa Ana), has opted to cater to a special interest lobby of personal injury lawyers and add one more example to their litany of self-serving, anti-consumer money-making projects.

SB 796 is not unlike California's Unfair Competition Law (also known as Business and Professions Code 17200). The law has allowed California to become a personal injury lawyer's utopia. Like SB 796, it allows personal injury lawyers to threaten a lawsuit and demand settlement money without having an actual client, and actual proof of injury or financial harm.

Comments Maryann Maloney, Executive Director of Orange County Citizens Against Lawsuit Abuse and Orange County's auburn haired version of Ann Coulter, "We're saying that there should at least be a victim, there should be harm done before there can be any type of lawsuit. If we want to make California a business-friendly state we have to make it a level playing field with other states that are taking jobs away from us."

Under SB 796, the potential for more frivolous litigation against employers, as well as the impact on California jobs could be disastrous. Why would any business choose to stay or expand in such a hostile legal environment? When the businesses go, so do the jobs.

It's time California and the other 49 state Legislatures, stopped lining the pockets of their personal injury lawyer friends at our expense, and took steps that will truly be in the best interest of all Americans.

Editors Note: Michael Arnold Glueck wrote this week's column.

Robert J. Cihak, M.D., is a Senior Fellow and Board Member of the Discovery Institute and a past president of the Association of American Physicians and Surgeons. Michael Arnold Glueck, M.D., is a multiple-award-winning writer who comments on medical-legal issues.

Contact Drs. Glueck and Cihak by e-mail.