We’ve talked a great deal about how vulnerable small businesses are to lawsuits under the Americans with Disabilities Act. Indeed, it is all too easy for trolling plaintiffs to spot technical violations of the (ADA), sometimes without ever stepping into a business. Indeed, some vexatious plaintiffs make a living bringing flimsy (or entirely frivolous) ADA claims—typically threatening litigation, unless the business—caught in the cross-hairs—agrees to pay a hefty settlement. And the trouble is that it is often more costly to retain counsel and prove your innocence than it is to settle a frivolous claim.
Of course, in those cases where a plaintiff has wrongfully alleged a business to be in violation of the ADA, these settlements are nothing less than extortion. In economic terms defendants are willing to pay the “nuisance value” of a threatened lawsuit—just to make it go away. Yet, as NFIB Legal Center’s Senior Executive Counsel, Elizabeth Milito, explained in her recent testimony to Congress, this economic calculus creates a perverse incentive for plaintiff’s attorneys to pursue questionable claims. (Forbes covered Milito’s testimony here).
When it comes to ADA lawsuits, plaintiff’s attorneys have a special interest in pursuing potential violations because they stand to win attorney’s fees. And that explains why one group brought over 1,700 lawsuits against small businesses in the Phoenix area for minor alleged violations. But in August, 2016 Arizona Attorney General Mark Brnovich stepped in to end this reign of legal terror.
The Attorney General’s office intervened and successfully consolidated these cases before a single judge. Soon thereafter, the judge dismissed 1,000 of those pending cases. Then, things got interesting—as the Attorney General sought to bring sanctions against this group for bringing frivolous claims against the small business community. And of course, NFIB praised the Attorney General throughout this process for taking a stand against litigation abuse.
Now we have great news out of Phoenix once again, as the Attorney General has entered into a settlement agreement that permanently bars this vexatious litigant from bringing another ADA claim. This settlement also requires the vexatious plaintiff to pay court fees and reasonable attorney fees for the various defendant businesses, and to pay $25,000 to the State to use in educating small businesses on ADA compliance.
Yet, this marks a victory only against a single (especially abusive) group. And the reality is that ADA lawsuit abuse will continue elsewhere, until we see meaningful reforms. In the interim, all we can do is work to help educate small business owners on how to remain compliant. For guidance, check out this recent post on what to do if you are hit by an ADA lawsuit, and on what you need to know to avoid ADA lawsuits.