FOR IMMEDIATE RELEASE
Contact: John Kabateck, California State Director, john@kabstrat.com
or Tony Malandra, Senior Media Manager, anthony.malandra@nfib.org

SACRAMENTO, Calif., Dec. 9, 2025—Congratulations, Los Angeles. You blew past seven competitors to win the title of No. 1 Judicial Hellhole in the nation, according to today’s release of the 2025-2026 Judicial Hellholes report by the American Tort Reform Foundation.

“California, a perennial Judicial Hellhole, has appeared on the list almost every year since its inception,” according to the report. “While little has improved across the state, this year, lawsuit abuse and judicial bias in Los Angeles have set it apart, propelling the jurisdiction to the very top of the list …

“This summer, RICO filings brought to light extensive alleged fraud in Los Angeles courts. The jurisdiction also continues to serve as a breeding ground for abusive lawsuits under the Americans with Disabilities Act and Proposition 65 claims, as well as privacy lawsuits that target small businesses. Courts have allowed novel theories of product and environmental liability to move forward, and lemon law cases routinely deliver windfall recoveries to plaintiffs’ attorneys.”

The latest report is not a surprise to John Kabateck, state director for the National Federation of Independent Business in California. “In a state where the trial-lawyer lobby has an outsized influence, you can’t help but feel that lawsuit abuse seems to be the standard operating procedure of our judicial world. If you want a sterling example of how the shakedown mill works, look no further than Senate Bill 222 (Wiener), which would have opened up whole new opportunities for litigation under the guise of climate change; Senate Bill 799 (Allen), which would have greatly expanded the False Claims Act to include confidential records; and another Wiener proposal, Senate Bill 310, which would have undone all the reforms to the Private Attorneys General Act (PAGA). Fortunately, all three bills failed to pass.”

A deal forged last year reformed the state’s horrendously bad anti-employer law, the 20-year-old Private Attorneys General Act (PAGA), but it took the threat of a ballot initiative, the Fair Pay and Employers Accountability Act, to bring some of the reluctant parties to the table. Given the outcome of a ballot measure such as Proposition 36, which showed people fed up with a lot of California’s current system, it was probably wise for the much-too-powerful attorneys’ lobby in this state to bargain rather than block.

Kabateck said small businesses are now looking to work with Sen. Roger Niello to make reforms to the Americans with Disabilities Act, another law rife with lawsuit abuse, along the same lines as the successful reforms made to PAGA. In the meantime, NFIB offers some helpful advice on responding to ADA lawsuits.

A lawsuit is no small matter to small business. The law firm of Novian & Novian says, “On average, it costs employers around $75,000 to work with an employment lawyer to settle a claim before it reaches trial. However, if the case progresses to court, the expenses can skyrocket, with pre-trial defense costs easily exceeding $125,000.”

Keep up with the latest California small-business news at www.nfib.com. Follow us on X @NFIB_CA and on Facebook @NFIB.CA.

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For over 80 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven association. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.

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