Half of our country’s workforce is employed in small business. Unlike large corporations, some of which grew during the COVID-19 shutdowns, small businesses are particularly vulnerable. About one-quarter of them closed during the pandemic.
Here in California, over one-third closed. Their owners and employees are still working to pick up the pieces. Our lawmakers have offered Paycheck Protection Program loans and loosened certain regulations to help them make it through the pandemic, but there’s still a big gap — protection against unwarranted litigation.
This need is not new. Small businesses have been threatened by frivolous lawsuits for years, particularly in California. You can sue a small business over anything you want. It costs just $400 to file. That’s not necessarily a bad thing. In America, everyone should have their day in court.
But easy access also means easy abuse. Each year the American Tort Reform Foundation looks across the nation to identify the states where lawsuit abuse is most prevalent. Our litigious environment has landed California on one of the top 10 spots on their Judicial Hellholes list for several years. In 2020, we earned the No. 3 spot. According to the report, almost 60% of Californians “believe that lawmakers are not doing enough to combat lawsuit abuse.”
