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Make Your Voice Heard California Statewide November 2, 2004 General Election
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Proposition 63
   
 
Proposition 64
   
 
Proposition 65
   
 
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  Title and Summary | Analysis | Text of Proposed Laws

ARGUMENTS AND REBUTTALS

Proposition 64

Limits on Private Enforcement of Unfair Business
Competition Laws. Initiative Statute.

ARGUMENT in Favor of
Proposition 64

PROTECT SMALL BUSINESSES FROM FRIVOLOUS LAWSUITS -CLOSE THE SHAKEDOWN LOOPHOLE

There's a LOOPHOLE IN CALIFORNIA LAW that allows private lawyers to file frivolous lawsuits against small businesses even though they have no client or evidence that anyone was damaged or misled. Shakedown lawyers "appoint" themselves to act like the Attorney General and file lawsuits on behalf of the people of the State of California, demanding thousands of dollars from small businesses that can't afford to fight in court.

Here's the little secret these lawyers don't want you to know:

MOST OF THE TIME, THE LAWYERS OR THEIR FRONT GROUPS KEEP ALL THE MONEY!

No other state allows this. It's time California voters stopped it. For years, Sacramento politicians, flush with special interest trial lawyer money, have protected the lawyers at the expense of California consumers, taxpayers, and small businesses.

Yes on Proposition 64 will stop thousands of frivolous shakedown lawsuits like these:

  • Hundreds of travel agents have been shaken down for not including their license number on their website.
  • Local homebuilders have been sued for using 'APR' in advertisements instead of spelling out 'Annual Percentage Rate.'

HERE'S WHAT ACTUALLY HAPPENED TO ONE SMALL BUSINESS VICTIM:

"My family came to this country to pursue the American Dream. We work hard to make sure our customers like the job we do. One day I got a letter from a law firm demanding $2,500. The letter didn't claim we broke the law, just that we might have and if we wanted to stop the lawsuit, we needed to send them $2,500. I called a lawyer who said it would cost even more to fight, so we sent money even though we'd done nothing wrong. It's just not right."
Humberto Galvez, Santa Ana

Here's why "YES" on Proposition 64 makes sense:

  • Stops these shakedown lawsuits.
  • Protects your right to file a lawsuit if you've been damaged.
  • Allows only the Attorney General, district attorneys, and other public officials to file lawsuits on behalf of the People of the State of California to enforce California's unfair competition law.
  • Settlement money goes to the public, not the pockets of unscrupulous trial lawyers.

"Public Prosecutors have a long, distinguished history of protecting consumers and honest businesses. Proposition 64 will give those officials the resources they need to increase enforcement of consumer protection laws by designating penalties from their lawsuits to supplement additional enforcement efforts, above their normal budgets."
Michael D. Bradbury, Former President
California District Attorneys Association

Vote Yes on Proposition 64: Help California's Economy Recover

"Frivolous shakedown lawsuits cost consumers and businesses millions of dollars each year. They make businesses want to move to other states where lawyers don't have a legal extortion loophole. When businesses leave, taxpayers who remain pick up the burden. Proposition 64 closes this loophole and helps improve California's business climate and overall economic health."
Larry McCarthy, President
California Taxpayers Association

Vote Yes on Proposition 64. Close the frivolous shakedown lawsuit loophole.

RAY DURAZO, Chairman
Latin Business Association

MARTYN HOPPER, State Director
National Federation of Independent Business

MARYANN MALONEY
Citizens Against Lawsuit Abuse

REBUTTAL to Argument in Favor of Proposition 64

Small business???
The Associated Press reported:
"Here are some of the companies that have made donations to the campaign to pass Proposition 64 and some of the lawsuits that have been filed against them under California's unfair competition law:
-Blue Cross of California. Donation: $250,000. Unfair competition suits have accused the health care company of . . . discriminating against non-company emergency room doctors and underpaying hospitals.
-Bank of America. Donation: $100,000. A jury found the bank misrepresented to customers that it had the right to take Social Security and disability funds from their accounts to pay overdraft charges and other fees.
-Microsoft. Donation: $100,000. Suit . . . accuses the computer giant of failing to alert customers to security flaws that allow hackers to break into its computer systems by gaining some personal information.
-Kaiser Foundation Health Plan. Donation: $100,000. One suit accused the health care provider of false advertising for claiming that only doctors, not administrators, made decisions about care . . .
-State Farm. Donation: $100,000. A group of victims of the 1994 Northridge earthquake accused the company of reducing their quake coverage without adequate notice. State Farm reportedly was forced to pay $100 million to policyholders."

Quoting the Attorney General's senior consumer attorney in the Department of Justice, the Los Angeles Times reports: "The initiative 'goes unbelievably far,'. . . 'Throwing the baby out with the bathwater is not the best thing' . . . the (current) law has been used successfully to protect the public from polluters, unscrupulous financing schemes and religious discrimination."

ELIZABETH M. IMHOLZ, Director Consumers Union, West Coast Office

SUSAN SMARTT, Executive Director California League of Conservation Voters

DEBORAH BURGER, RN, President California Nurses Association

 

ARGUMENT Against
Proposition 64

Proposition 64 LIMITS THE RIGHTS OF CALIFORNIANS TO ENFORCE ENVIRONMENTAL, PUBLIC HEALTH, PRIVACY, AND CONSUMER PROTECTION LAWS.

The Attorney General's Official Title for the Proposition 64 petition read: "LIMITATIONS on Enforcement of Unfair Business Competition Laws."

Across California headlines warn the public about this special interest initiative. San Francisco Chronicle: "Measure would limit public interest suits"; Ventura County Star: "Consumers lose if initiative succeeds"; Orange County Register: "Consumer lawsuits targeted"; San Francisco Examiner: "Bank of America's shakedown: Unfair-competition law under fire from businesses."

Look who is supporting Proposition 64. Consider why they want to limit California's 71-year-old Unfair Business Competition law.

Chemical companies support Proposition 64. They want to stop environmental organizations from enforcing laws against polluting streams, rivers, lakes, and our coast.

Oil companies support Proposition 64. They want to stop community organizations from suing them for polluting drinking water supplies with cancer-causing MTBE.

Credit card companies support Proposition 64. They want to stop consumer groups from enforcing privacy laws protecting our financial information.

IF A CORPORATION PROFITS FROM INTENTIONALLY POLLUTING OUR AIR AND WATER, OR INVADING OUR PRIVACY, WE SHOULD BE ABLE TO STOP IT.

The Los Angeles Times reports: "The measure would weaken a state law that allows private groups and government prosecutors to sue businesses for polluting the environment and for engaging in misleading advertising and other unfair business practices . . . If voters approve the measure, the current law would be drastically curtailed."

Tobacco companies support Proposition 64. They want to block health organizations from enforcing the laws against selling tobacco to children.

Banks support Proposition 64. They want to stop elderly and disabled people who sued them for confiscating Social Security funds.

Insurance companies and HMOs support Proposition 64. They don't want to be held accountable for fraudulent marketing or denying medically necessary treatment to patients.

Energy companies support Proposition 64. They ripped off California during the "energy crisis" and want to block ratepayers from attacking energy company fraud.

Since 1933, the Unfair Business Competition Laws have protected Californians from pollution, invasions of privacy, and consumer fraud. Here are examples of cases successfully brought under this law:

  • Supermarkets had to stop changing the expiration date on old meat and reselling it.
  • HMOs had to stop misrepresenting their services to patients.
  • Bottled water companies had to stop selling water that hadn't been tested for dangerous levels of bacteria, arsenic, and other chemicals.

The Los Angeles Times editorialized: "(Proposition 64) would make it very difficult for citizens, businesses, and consumer groups to file justified lawsuits."

Proposition 64 is strongly opposed by:

  • AARP
  • California Nurses Association
  • California League of Conservation Voters
  • Consumers Union
  • Sierra Club California
  • Congress of California Seniors
  • Center for Environmental Health
  • California Advocates for Nursing Home Reform
  • Foundation for Taxpayer and Consumer Rights

Please join us in voting NO on Proposition 64. Don't let them limit your right to enforce the laws that protect us all.

ELIZABETH M. IMHOLZ, Director
Consumers Union, West Coast Office

SUSAN SMARTT, Executive Director
California League of Conservation Voters

DEBORAH BURGER, RN, President
California Nurses Association

REBUTTAL to Argument Against Proposition 64

The argument against Proposition 64 is a trial lawyer smokescreen: Read the official title and the law yourself.

  • Nowhere is Environment, Public Health, or Privacy mentioned!
  • California has dozens of strong laws to protect the environment, public health, and privacy, including Proposition 65, passed by voters in 1986, the California Environmental Quality Act and the California Financial Information Privacy Act.
  • Proposition 64 doesn't change any of these laws.
  • Proposition 64 would permit ALL the suits cited by its opponents.

". . . the trial attorneys who benefit from the current system are going bonkers, and misrepresenting what (Prop. 64) will do. They claim that (Prop. 64) . . . will somehow undermine the state's environmental laws. That's patently untrue."
Orange County Register

Here's what 64 really does:

  • Stops Abusive Shakedown Lawsuits
  • Stops fee-seeking trial lawyers from exploiting a loophole in California law-A LOOPHOLE NO OTHER STATE HAS-that lets them "appoint" themselves Attorney General and file lawsuits on behalf of the People of the State of California.
  • Stops trial lawyers from pocketing FEE AND SETTLEMENT MONEY that belongs to the public.
  • Protects your right to file suit if you've been harmed.
  • Permits only real public officials like the Attorney General or District Attorneys to file lawsuits on behalf of the People of the State of California.

Join 700+ groups, small businesses, and shakedown victims, including:
California Taxpayers Association
California Black Chamber of Commerce
California Mexican American Chamber of Commerce

Vote YES on 64-www.yeson64.org

JOHN KEHOE, Founding Director Senior Action Network

ALLAN ZAREMBERG, President California Chamber of Commerce

CHRISTOPHER M. GEORGE, Chairman of the Board of Governors Small Business Action Committee



Arguments printed on this page are the opinions of the authors and have not been checked for accuracy by any official agency.


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