Is It Too Much Of A Nuisance For the Attorney General's Office To Do Its Job?

Ted Lieu, who’s angling for the job of California Attorney General, thinks plaintiffs’ lawyers should take over the role of the elected representatives and the appointed public servants who oversee the complex enforcement of statutory and regulatory rules affecting California consumers. According to LegalNewsline, Lieu said, "The single best way to deter misconduct is through private enforcement of the laws," and "If I were king for a day, I would greatly expand the private right of action," which allows private attorneys to sue on behalf of the public.

The funny thing is, California voters have said they don’t want private attorneys and their stalking horse clients to have broad rights to sue on voters’ behalf. In 2004, California passed Proposition 64, which ended California’s long experiment with a truly unique consumer law standing provision that allowed “any person” to sue businesses “on behalf of the general public.” After Proposition 64 passed, amending California’s Unfair Competition Law (Business & Professions Code section 17200 et seq.), businesses accused of misleading consumers could still be found liable under extraordinarily lenient standards of proof, but the person pursuing the claim had to be someone who actually lost money or property as a result of the challenged business practice. That change brought the Unfair Competition Law (UCL) in line with the otherwise near universal rule that a law suit claiming a wrong was done ought to be brought by the person who was wronged, and not by an officious intermeddler trying to make a buck off of someone else’s perceived injury.

Proposition 64 came about when a majority of the voting public came to understand what had become increasingly clear to practicing lawyers and judges at the front lines of consumer litigation: injecting a personal profit motive into prosecution of claims that purport to broadly benefit the general public leads to some pretty crazy results. An individual lawyer could, before proposition 64, go around the state tagging businesses small and large for technical rule violations—or even for conduct that was just vaguely “unfair” in someone’s subjective opinion—and collect big judgments and settlements without ever having to show that a single consumer was actually harmed by the defendant’s conduct. Cloaking themselves in the mantle of “consumer protection,” the litigation mill lawyers who made a living off of these so-called consumer claims didn’t take into account that “consumers” include not just those who supposedly gained marginal protection against business practices that weren’t actually bothering anyone, but also those who had to pay higher prices for the goods and services provided by the targeted businesses that were defending themselves against serial law suits, and also those who lost their jobs when businesses downsized or left the state because of the out-of-whack litigation climate here.

Pointing to the state’s shrinking budget, Lieu has indicated he wants private enforcement of inherently public rights because he thinks it’s cheaper and easier to outsource public prosecution rather than having the attorney general’s office (which he hopes to head) do its job. But here’s the thing: you get what you pay for. Protecting public rights is a delicate balancing act that requires an objective understanding of legitimately competing interests. Farming that role out to private attorneys filing civil law suits may reduce the workload for the attorney general’s office in the short run, but by definition that means handing over the reins to someone who is trained to be a zealous advocate for one side in a dispute, and who is compensated not on the basis of achieving the best result for the greatest number of people, but on the basis of collecting a contingency fee percentage of the highest dollar figure they can get from whatever target has the means to pay.

The better approach? If the attorney general’s office needs more lawyers on occasion to pursue public claims (perhaps to obtain statutory penalties under the UCL, remedies under public nuisance laws, enforcement of tax laws, and so forth), those lawyers can be brought in as independent contractors, and paid on an hourly basis. Such lawyers would have the clear understanding that their mission is aligned with that of the attorney general’s office and the state as a whole: prosecute public claims using the full sovereign power of the state to obtain the best outcome for all, without being distracted by the prospect of a jackpot judgment at the end of the process.