By Victor Gomez, executive director, Citizens Against Lawsuit Abuse
As business owners check their mailboxes this Halloween season, they shouldn’t have to fear being targeted by a frightening demand letter threatening costly litigation. Yet for too many California businesses, that fear has become a reality. One of the scariest examples has been the explosion of lawsuits under the California Invasion of Privacy Act (CIPA), a statute written in 1967 to stop illegal wiretapping of landline telephones. This law was never intended to regulate online activity decades before the internet even existed.
This haunting dynamic allowed unscrupulous attorneys and plaintiffs to exploit CIPA to bring over 4,000 abusive lawsuits over common website tools such as analytics, pixels, and other digital services, without any allegation of actual harm or injury.
The good news worth celebrating this Lawsuit Abuse Awareness Week, October 5 through 9, is that Governor Gavin Newsom has put an end to this modern shakedown tool by signing Senator Ana Caballero’s SB 690 into law. The new law delivers much-needed relief to thousands of California businesses, nonprofits, and public agencies that have been targeted by abusive CIPA lawsuits. While this victory is worth celebrating, there is still much more work to do to stop frivolous lawsuits from hurting hardworking Californians.
For example, the Private Attorneys General Act (PAGA) continues to place enormous burdens on California employers. The law allows employees to sue employers over technical labor code violations and seek substantial penalties that can quickly escalate into six- and seven-figure settlements.
Despite reforms being enacted several years ago, PAGA litigation continues to surge. According to the California Business and Industrial Alliance, settlements exceeded $1.6 billion in 2024 and climbed to more than $2.2 billion in 2025. Those numbers make it clear that PAGA still needs reform.
As long as financial incentives encourage unwarranted litigation, businesses will remain vulnerable to costly lawsuits over technical violations that cause little or no actual harm. The same bewitching pattern appears in Americans with Disabilities Act (ADA) litigation.
Everyone supports the spirit of the ADA and its goal of ensuring access to public places for people with disabilities. But the ADA has become a tool for trial lawyers to target small businesses or minor fixable issues, such as an incorrect or missing parking lot sign. With legal battles so expensive, business owners are forced to settle.
Senator Roger Niello offered a common-sense solution through SB 84. His bill would have given small businesses up to 120 days to correct certain ADA violations before facing litigation. While the bill passed the Senate with overwhelming support, it never received a hearing in the Assembly Judiciary Committee and failed to advance before the legislative session concluded.
When faced with lawsuits, business owners must divert money that could otherwise be used to increase employee wages, expand operations, improve facilities, keep prices affordable for consumers, or simply keep their doors open.
The consequences of abusive lawsuits extend beyond individual businesses. California residents pay an estimated $2,567 per person annually in what is commonly referred to as a “tort tax,” the hidden cost of litigation passed on through higher prices, reduced investment, and fewer economic opportunities.
This Lawsuit Abuse Awareness Week, and every week, California Citizens Against Lawsuit Abuse, our supporters, and small business owners across the state have a simple message for lawmakers:
Stop making it easier to file ghoulish shakedown lawsuits. Instead, reform laws to reduce financial incentives for litigation when no real harm has occurred. The passage of SB 690 demonstrates that lawmakers can take meaningful action to curb abuse of the legal system while preserving access to justice for those who have been wrongfully harmed.
This Halloween, let’s take away the tricks from those who abuse the legal system for personal gain and protect the businesses, jobs, and consumers that keep our communities strong.
