Restriction on Lawsuits

Summary: The measure would restrict a person’s right to sue under the Unfair Business Competition Law, known as 17200 after its section number in the business and professions code. The law allows anyone to sue a company, even if he or she wasn’t directly affected by its conduct. If Proposition 64 passes, only people who have been injured or suffered losses could sue for unfair practices or false advertising. Claims on behalf of a larger group would have to meet stringent requirements for class-action status. Only government prosecutors would be authorized to sue on behalf of the public. Civil penalties recovered in such suits could be used only for enforcement of consumer laws.

Supporters: The California Chamber of Commerce, Civil Justice Assn. of California and California Motor Dealers Assn. sponsored the measure. A range of business interests, including oil companies, health maintenance organizations and small business groups, support the measure.

Opponents: The California Trial Lawyers Assn., the Foundation for Taxpayer and Consumer Rights, the Sierra Club, the California Nurses Assn., and other conservation and consumer watchdog groups oppose the measure.

Impact: Supporters argue that unscrupulous attorneys are abusing the law to churn out lawsuits and win quick financial settlements from small companies. A victory could greatly reduce the threat of lawsuits against businesses.

Opponents believe the law has been a tool for forcing businesses to stop selling unsafe products, running misleading advertising and polluting the air and water. They say abusive lawsuits could be curbed by changing the current law.

Websites: Yes on 64: stopshakedownlawsuits.com.

No on 64: www.electionwatchdog.org.