Court rules that fraudulent ADA lawsuits are immune from action by the state?

It has not been a good summer for stemming the tide of shake-down lawsuits filed under the banner of the ADA.  Courts.

On April 24, 2019, the District Attorney of Riverside County filed a civil lawsuit, People of the State of California v. James Rutherford, et al., Case No. RIC 1902577. The lawsuit alleged, among other things, that Plaintiff misrepresented his disability and that his access lawsuits, e.g., the “ADA Action” were essentially fraudulent. The lawsuit gave numerous examples of allegedly fraudulent conduct in preparation for filing lawsuits against businesses.

Small businesses and their attorneys applauded the long-overdue law enforcement action on a topic that has been rife with fraud and cynical lawsuit abuse.  The optimism was short-lived.

On July 24, 2019, the Riverside Superior Court, the Hon. Sunshine Sykes presiding, dismissed the D.A.’s lawsuit (sustained the demurrer of Plaintiff and his co-defendants without leave to amend).  The Court’s ruling did not include findings or a statement of reasons. However, the briefing of Plaintiff and his co-defendants argued that the Noerr-Pennington Doctrine and the Civil Litigation Privilege found in Civil Code §47(b) granted immunity from prosecution or liability to persons for even fraudulent conduct in private litigation, particularly settled litigation.  The briefing further argued that it was up to the defendant in each lawsuit in the course of the litigation to conduct discovery and argue that Plaintiff’s conduct was fraudulent. The Court appears not to have made any findings, one way or the other, regarding the Riverside District Attorney’s factual investigation and allegations.

Of course, the idea that it’s up to each defendant, on their own, to prove fraud is the rub.  That’s a $50,000 plus investment for each defendant with a lot of risks.  That means that ADA plaintiffs, fraudulent or not, can coerce settlements for $25,000 with impunity, . . . actual immunity, all day long.

 

 

About William Adams

Attorney at Norton, Moore, & Adams, LLP.
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