What Relief Does New Disability Access Legislation Provide for Businesses?
In recent years, in response to complaints from both large and small business owners, the California Legislature enacted a variety of measures to rein in lawsuits by individuals with disabilities under California’s Unruh Civil Rights Act and Disabled Persons Act (collectively “Unruh Act”). On May 10, 2016, Governor Jerry Brown signed into law Senate Bill 269 (SB 269), in another effort to provide some “safe harbor” to business owners. This article will identify some of the recent and more prominent changes to the Unruh Act (and related statutes), and how they may assist building and business owners in limiting financial responsibility for some violations of disability access laws.
Equal Access to Businesses for Individuals with Disabilities
Individuals with disabilities are entitled to equal access to businesses open to the public, and their services and products, under both state and federal law. Disabled individuals are protected under federal law by the Americans with Disabilities Act of 1990 (ADA) and its related regulations and in California under the Unruh Act and related accessibility building standards set forth in Title 24 of the California Code of Regulations (Title 24). The Unruh Act, unlike the ADA, provides for the award of monetary damages in addition to injunctive relief and attorneys’ fees, while disabled individuals are limited only to injunctive relief and attorneys’ fees for the violations of the ADA.
Under the Unruh Act, individuals with disabilities may recover up to three times the amount of actual injuries and damages suffered as a result of the denial of access, or instead, recovery of $4,000 in damages (with some exceptions) without any proof of actual injury at all (statutory damages). As a consequence of this entitlement to statutory damages, a financial incentive exists in California to file disability access lawsuits.
For more than 10 years, the Legislature has attempted to address legitimate, competing interests of the disabled community, who certainly are entitled to equal access to the goods and services of all businesses open to the public, and the business community, who complain they are targeted by “professional” or “serial” plaintiffs (and their lawyers) trolling for accessibility violations without ever intending to purchase goods or use any of the services offered by those businesses. California has tried to satisfy both groups of constituents in an attempt to minimize the well-known abuses of a few, but without directly addressing the conundrum created by the award of statutory damages without proof of any injury.
Past Legislative Efforts
In 2008 (Senate Bill 1608), and later in 2012 (Senate Bill 1186) and in 2015 (Assembly Bill 1521), California enacted various procedures to reduce disability access lawsuits considered to be frivolous or abusive. These efforts included identifying high-frequency litigants who have filed 10 or more complaints alleging access violations in the preceding 12 months, by requiring them to pay an additional $1,000 filing fee and to explain why the individual visited the business, among other things. A business owner can now “stay” a lawsuit and move for the mandatory scheduling of an evaluation/settlement conference with a judge if the complaining party is a high-frequency litigant or if the business owner had previously obtained a certificate from a Certified Access Specialist (CASp) stating that the business complied with accessibility standards and regulations.
Additionally, legislative changes have reduced liability for statutory damages to $1,000 per offense if a business had been previously inspected by a CASp and all construction-related violations were corrected within 60 days of being served with a civil complaint (among other conditions). Similarly, statutory damages have been reduced against “small businesses” to $2,000 per offense if all construction-related violations are corrected within 30 days of being served with a civil complaint. Previous legislation also prohibited pre-lawsuit demands for money to settle disputes about disability access. A plaintiff was also required to establish that the barrier to access that existed at the businesses caused “difficulty, discomfort or embarrassment” that either prevented or dissuaded her from accessing the business. In other words, a very minimal threshold to the recovery of statutory damages.
Legislation also clarified that statutory damages were limited to each particular denial of access to the business, regardless of the number of technical violations encountered during the visit to the business. But none of these statutory refinements eliminated “automatic damages,” or required persons who were denied access to first notify the building owner or tenant of the existence of barriers to access, providing an opportunity to address or remove them before filing a civil lawsuit for damages. As a result, the desired reduction in disability access lawsuits in California has never materialized.
SB 269 Benefits Provide Some Relief from Abusive Plaintiffs
The “ADA Wars” are primarily fought in federal, not state, courts. While federal law does not permit recovery of monetary damages, federal courts typically exercise “pendent jurisdiction” over state law claims and can award damages under California law when both federal and state law claims are asserted. Local federal courts also impose stringent obligations on the parties to promptly meet and confer to address accessibility claims and is, therefore, a favored forum for accessibility lawsuits. Yet, the procedural mechanisms imposed by state law to stay litigation if a CASp report had already been obtained and other similar measures are not generally recognized or followed by federal courts. As a consequence, many of the legal refinements made by California’s Legislature look good on paper, but in practice provide little real relief for businesses who are typically sued in federal court.
Still, SB 269 has taken a few steps forward. SB 269 creates “a rebuttable presumption” that certain technical violations of Title 24 do not cause a complaining individual to experience “difficulty, discomfort or embarrassment,” which would otherwise entitle the individual to statutory damages. SB 269 also exempts modest-sized businesses from liability for statutory damages if their premises were inspected by a CASp before a claim is filed and all required corrections are completed within 120 days of the inspection (and up to 180 days if delays are caused by a building permit approval). In other words, SB 269 continues to provide incentives to business owners to have their premises inspected by a CASp and make readily achievable changes within a reasonable period of time. These measures will in fact provide some refuge from abusive plaintiffs.
SB 269 also enacted the Permit Streamlining Act, which establishes new procedures for applications for certain development projects and their review. Local agencies are now required to expedite review of projects when the applicant demonstrates that the project is necessary to address alleged violations of disability access standards or a violation noted in a CASp report. Also, a welcome change for the better.
Limitations on the “Rebuttable Presumption”
The relief provided by SB 269, nonetheless, is limited. The “presumption” that certain violations do “not cause a person difficulty, discomfort or embarrassment” applies only to small businesses employing 25 or fewer employees on average over the past three years (or for the years that it has been in existence if less than three years) as evidenced by wage report forms filed with the Economic Development Department and have an average annual revenue of less than $3.5 million during the previous three years, or for the years it has been in existence if less than three years, as evidenced by its Federal or State income tax returns.
In addition, this favorable presumption will only arise if all identified violations are corrected within 15 days of the earlier of receipt of a summons and complaint asserting a construction-related disability claim, or receipt of written notice of the violations that are the basis of the claim, and the violations are one of these seven relatively minor transgressions:
- Interior signs, other than directional signs or signs that identify the direction of accessible elements, facilities or features, when not all are accessible;
- The lack of interior signs, other than parking signs and directional signs, including signs indicating the location accessible pathway or entrance or exit doors when not all pathways, entrance and exit doors are accessible;
- The order in which parking signs are placed or the exact location or wording of parking signs, provided that the parking signs are clearly visible and indicate the location of accessible parking and van-accessible parking;
- The color of parking signs, provided the color of the background contrasts with the color of the information on the sign;
- The color of parking striping, provided that it exists and provides sufficient contrast with the surface upon which it is applied to be reasonably visible;
- Faded, chipped, damaged or deteriorated paint of otherwise fully compliant parking spaces and passenger access aisle and parking lots provided that it indicates that the required dimensions of a parking space or access aisle in a manner that is reasonably visible; and
- The presence or condition of detectable warning surfaces on ramps, except where the ramp is part of a pedestrian path of travel that intercepts with a vehicular lane or other hazardous area.
Importantly, the presumption that no difficulty, discomfort or embarrassment is suffered for these minor violations is simply a “rebuttable” presumption that only affects a complaining party’s burden of proof. It can be rebutted by evidence showing that the complaining party did, in fact, experience difficulty, discomfort or embarrassment on the particular occasion(s) as a result of one or more of the technical violations listed above. This may involve distress and anxiety about where to park or which direction to safely travel to enter the business, or potentially being embarrassed to ask where disabled access to the business is located. And, of course, the rebuttable presumption only applies to the technical violations enumerated in the law and not to other alleged violations that are also likely to be alleged. In other words, not much protection at all for businesses.
The CASp Inspection and Remediation Defense
If real benefit can be found in SB 269, it is the provision that allows for a longer and more realistic opportunity to correct disability access violations and for certain larger businesses to avoid statutory damages. Now, qualified businesses will not be subject to statutory damages, if they demonstrate all of the following:
- The business, as of the date of inspection, has employed 50 or fewer employees on average over the past three years, or for the years it has been in existence if less than three years, as evidenced by the wage reports filed with the Employment Development Department;
- The structure or area of the alleged violation was the subject of a CASp inspection (“CASp determination pending” or “Inspected by CASp”);
- The inspection predates the filing of the claim, or receipt of a demand letter from, the plaintiff regarding the alleged violation and the business was not on notice of the alleged violation prior to the CASp inspection; and
- The business has corrected all construction-related violations, as noted in the CASp report, within 120 days of the date of the inspection.
If the business fails to correct all construction-related violations within 120 days of the date of the inspection, it will not receive any protection from statutory damages, unless a building permit was required for the needed corrections that could not reasonably be completed within 120 days. In such a case, business owners will have up to 180 days from the date of inspection to complete all required corrections, if it has begun the process of correcting the violations, as evidenced by, at least, an active building permit necessary for the improvements to correct the violations. Yet, these protections will not apply to intentional violations of the law, affect the awarding of actual damages for injuries actually suffered, or the awarding of treble actual damages, if applicable.
Some limited, if not significant, safe harbor was created by SB 269. If your business employs 50 or fewer employees on average over the three years before an accessibility claim is asserted and a CASp inspection has already occurred, then for a period of 120 days (or up to 180 days if delays occur in the permitting process), statutory damages for violation of construction-related accessibility laws may be eliminated if the needed corrections are timely made.
A new incentive now exists to retain a CASp to inspect your business premises to determine if it complies with California’s construction-related accessibility laws and regulations. Reluctant business owners may now want to re-consider, or consider for the first time, whether to retain a CASp to inspect their premises and ensure legally compliant access for individuals with disabilities. Since statutory damages that require no real proof of injury is the law in California, businesses should take advantage of the modest new protections created by SB 269 to avoid such damages and the attendant legal expense that will necessarily be incurred.