CIWA Endorses Civil Justice Association of California’s Ballot Initiative

The California Insurance Wholesalers Association (CIWA), an industry group of wholesale insurance brokerage operations, has endorsed the Civil Justice Association of California’s Ballot Initiative to Reform California’s Unfair Competition Law.

“Many CIWA members specialize in providing insurance coverage for small ‘mom and pop’ businesses of the type being victimized by these so-called shakedown lawsuit mills,” stated Haldeman, president of CIWA. “While we’re seeing that no business sector is really insulated from these suits, CIWA is taking a stand on the reform initiative as the type of businesses being targeted more frequently is at the core of CIWA’s business, including auto repair shops, convenience stores, nail salons, travel agents and restaurants. We’re all too aware of the economic damage–and heartache–caused by this outrageous practice.”

The Stop Shakedown Lawsuits Initiative (www.stopshakedownlawsuits.com) seeks to close a legal loophole in the Business and Professions Code Section 17200. ‘17200’ has become shorthand to describe California’s Unfair Competition Law, regularly used by public prosecutors to protect consumers and firms from unfair business practices. The loophole in the current law also allows private lawyers to file suit against a business even though it has not injured, damaged or misled anyone, and a consumer or other business has made no request for a lawsuit. Typically, lawyers who abuse the loophole never intend the frivolous 17200 suit make it to court, but use threatening form letters demanding a business owner pay a several-thousand dollar settlement or face an even more costly lawsuit.

“We’re pleased to be a part of this effort…it’s one more issue confronting California that absolutely must be addressed,” Haldeman said. “The current legislature has failed to act, so the initiative process appears to be the only remedy in correcting yet another obstacle to doing business in this state. CIWA encourages not only its members, but all Californians to support the initiative.”

Topics Lawsuits California