California Cities Sue Law Firm Accused of Abusing the ADA To Target Small Minority Businesses

Los Angeles and San Francisco filed civil suits against Potter Handy in San Diego, alleging that it illegally files thousands of Americans with Disabilities Act claims throughout the state. This is without legal standing.

California’s Unruh Act is being evaded by the law firm, according to the cities. The Unruh Act has many procedural requirements that would prohibit these cases from going to state court. The Unruh Act allows plaintiffs, in addition to any settlement, to demand minimum $4,000 damages for ADA violations.

Potter Handy wants it all, but the lawsuit says otherwise. “By using false standing allegations to get an ADA injunctive-relief claim into federal court—where the [California] Legislature’s procedural reforms on abusive Unruh Act litigation do not apply—and coupling the federal claim with a state-law Unruh Act claim, Potter Handy is able to avoid those reforms while demanding small businesses pay it the heavy damages available under the Unruh Act.”

Potter Handy insists that the client of the city must “personally encounter an ADA violation at the company” and show that he was “deterred from or prevented access to the business by it.”

It is alleged that it is physically impossible for Potter Handy’s Serial Filer clients (at least some) to continue traveling to all the thousands of businesses sued, particularly those hundreds of miles away from their home.

Potter Handy, who allegedly caused harm to clients by “frequently don’t personally encounter barriers (often conducting cursory “drive-bys” or having investigators or helpers go to businesses in their places), and almost never returns to the businesses that they sued after cases have resolved,” is also breaking state laws prohibiting “deceit, collusion, consent”.[ing]Any deceit, collusion or attempt to deceive any court or party.

According to the complaint, cities claim that evidentiary documents support their claims. This includes evidence from Federal courts. [previously] awarded attorney’s fees to businesses and sanctioned Potter Handy attorneys…for the firm’s bringing of frivolous or false standing allegations. Other federal courts…have thrown out Serial Filer cases for lack of standing, holding that their allegations simply are not credible. Moreover, the astonishing number of cases Potter Handy files on behalf of the Serial Filers—over 800 federal cases on behalf of Serial Filer Orlando Garcia, approximately 1,700 federal cases on behalf of Serial Filer Brian Whitaker, and thousands more on behalf of…various other Serial Filers—make it literally impossible for the Serial Filers to have personally encountered each listed barrier, let alone to intend to return to hundreds of businesses located hundreds of miles away from their homes.”

Los Angeles is home to two of the thousands of Potter Handy plaintiffs. However, according to the lawsuit L.A. courts started to notice them and began dismissing their cases. Thus, one serial filer in Los Angeles “taped off his activities in Los Angeles early 2021”, and the firm began to file “an immense number of federal lawsuits on his behalf in federal court in San Francisco, Oakland and San Jose. Eventually, there were over 500 new cases filed between February 2021 and 2022.”

Similarly, another such serial filer “on whose behalf Potter Handy filed nearly 500 physical-barrier ADA/Unruh cases in Los Angeles’s federal courts beginning in 2019, suddenly stopped initiating cases there in early 2021….Defendants began filing…over 320 physical-barrier ADA/Unruh cases in the… Northern District of California in a ten-month period from May 2021 to March 2022” on that other man’s behalf.

These cities consider this suspicious given the fact that both of those men, who were suddenly ADA-litigious for their Bay Area home, also live in Los Angeles County. Potter Handy was responsible for this shift, which allegedly occurred in places where they were supposedly facing ADA-reparable access barriers. It also highlights the fact that Serial Filers lawsuits do not seek to correct ADA violations experienced by Serial Filers within their daily lives, but rather to maximize financial returns to Defendants as well as the Serial Filers by targeting small, vulnerable businesses in plaintiff-friendly judicial venues.”

These cities claim that they are supporting a minority of people being attacked by Potter Handy. Potter Handy has used ADA/Unruh lawsuits each year to take down hundreds, if not thousands, of small businesses in order to settle it with cash, regardless of whether they have violated the ADA. According to the cities, this single firm is responsible for extorting tens of thousands from California small businesses through its suits.

Dennis Price of Potter Handy told Courthouse News that “the allegation that we targeted any particular community is a heinous lie and not supported by any evidence…our cases are filed throughout the state. They aren’t targeting any one neighborhood or particular business.