August 25, 2019

Archives for October 18, 2012

Colorado Businesses Beware – ADA Public Accommodation “Drive-By” Lawsuits On The Rise

The opinions and views expressed by Featured Bloggers on CBA-CLE Legal Connection do not necessarily represent the opinions and views of the Colorado Bar Association, the Denver Bar Association, or CBA-CLE, and should not be construed as such.

Known as “Drive-By Litigation,” Colorado is getting hit by a rash of lawsuits alleging that businesses are violating Title III of the Americans With Disabilities Act (ADA). Since April of this year, 20 lawsuits (and counting) have been filed against Denver area businesses by the same Plaintiff who is represented by the same two attorneys from Florida, for alleged violations of Title III of the ADA, including things like lack of ramps, narrow doorways, missing signage, doorknobs that can’t be opened by a closed fist, and misplaced soap dispensers and coat racks.

Most of the businesses are in well-to-do areas of Denver, such as The Highlands, LoDo, LoHi, and SoBo, and include everything from popular restaurants, hair salons, day spas, tobacco shops, muffler shops, delis, and donut shops, to even a motel and a tile and linoleum shop. Channel 7 News recently ran a news story that is worth viewing called “Colorado Businesses Claim Identical ADA Lawsuits Filed By Florida Attorney ‘Extortion.’”

What Is “Drive-By Litigation”?

Although premised on the altruistic goal of fighting disability discrimination, these suits have become a profit-driven, litigation machine of high volume, boilerplate complaints, filed with the ultimate goal of squeezing business owners so that the plaintiffs and their attorneys can profit quickly from cash settlements in the tens of thousands of dollars.

The problem with these cases is that the vast majority are not situations where a disabled individual truly felt discriminated against and sought out an attorney to help redress an injury due to a lack of accommodation. Instead, it is the lawyers who hire investigators to identify local businesses that are not in technical compliance with the ADA, and then recruit plaintiffs from disability advocacy groups to serve as the front person. The investigators take pictures and build the case while the plaintiffs merely “drive by” the establishment, without any honest intentions of ever servicing the establishment.

Once the boilerplate suit is filed, questionable litigation tactics are then employed, such as serving immediate discovery in violation of the rules, asking the courts to order the parties to a settlement conference to force a quick settlement, and refusing to accept agreements or assurances of ADA compliance without monetary payments, even though the ADA itself does not allow damages to be awarded to plaintiffs (the ADA allows only injunctive relief and attorneys’ fees).

Earlier this year, the New York Times reported that “[i]n the last year, 3,000 [accessibility] suits, including more than 300 in New York, were brought under the Americans With Disabilities Act, more than double the number five years ago.” Other states hit hard have been Ohio, Florida, California and North Carolina. This is an unfortunate and lucrative cottage industry in the legal profession, preying on small businesses who often times opt for settlement over litigation to avoid legal costs since they don’t have resources like Wal-Mart. But, in some cases, where business owners decide to fight back, courts have dismissed the suits, sanctioned the plaintiff’s attorneys for unscrupulous litigation tactics, and/or awarded attorneys’ fees to prevailing business owners.

What Can Businesses Do Before They Get Sued?

If you have not done an audit lately, or ever, it is a good idea to conduct an ADA accessibility audit. Self-audits can be done with good checklists, or by a professional. Also, it is important for business owners to review their insurance coverage to see if they have, or can obtain, insurance coverage for accessibility lawsuits.

What Can Businesses Do If They Get Sued?

You are not alone, so don’t go it alone. Engage competent counsel to protect your rights as a business owner. Legal arguments can be made to dismiss certain claims or to dismiss the entire case at the onset of litigation or after discovery, which can save thousands of dollars in legal fees.

Jennifer L. Gokenbach is the founder and principal attorney of Gokenbach Law, a boutique law firm that specializes in labor and employment matters. As a trial lawyer, Jennifer has successfully handled a wide variety of employment disputes, including discrimination, harassment, retaliation, disability, wage & hour, breach of contract, and other employment-related claims under both federal and state law. She also writes the Colorado Employer’s Law Blog, where this article originally appeared.
She also provides consulting services with respect to workplace investigations, fair pay and wage & hour audits, training, and drafting workplace policies. Prior to starting her own firm, Jennifer was a Shareholder with Ogletree, Deakins, Nash, Smoak & Stewart, P.C., one of the nation’s largest labor and employment firms.

Tenth Circuit: Preliminary Injunction Enjoining Gas Production Affirmed Because of Likely Success of Nuisance Claim

The Tenth Circuit issued it’s opinion in Northern Natural Gas Company v. L.D. Drilling on October 17, 2012.

In these consolidated interlocutory appeals, Defendants-Appellants, natural gas producers with wells in south central Kansas, challenge a preliminary injunction enjoining them from further gas exploration of those wells. The district court entered the preliminary injunction after concluding there was a substantial likelihood that Plaintiff-Appellee Northern Natural Gas Company would prevail on it’s state-law claim alleging that Defendants’ natural gas production from these wells was an actionable nuisance because it was disrupting Northern’s nearby underground storage of natural gas.

The parties agreed that, to succeed on the nuisance claim, Northern had to establish four elements: 1) that there was an interference with Northern’s use and enjoyment of the field, and that the interference was substantial (this was undefeated); 2)  that there was a substantial likelihood Northern would be able to establish that Defendants acted with the intent to interfere with Northern’s use and enjoyment of the field (the Tenth Circuit found this to be true); 3) that the nature, duration, or amount of of Defendant’s interference with Northern’s use of the field was unreasonable; and 4) that there was a substantial likelihood that Northern would prevail on it’s nuisance claim.

Having found no abuse of discretion, the Tenth Circuit AFFIRMED the preliminary injunction.

Tenth Circuit: Insurance Company Had No Contractual Relationship with Foster Child

The Tenth Circuit issued it’s opinion in Colony Insurance Company v. Burke on October 17, 2012.

In January 2002, the Oklahoma Department of Human Services (DHS) placed six-month-old Aurora and four-year-old Cassandra in the foster care of Deanza Jones. Less than one month later, Aurora was found dead due to an untreated respiratory illness. Aurora’s estate brought a state-court wrongful death action against Jones, DHS and two DHS employees.

Oklahoma purchases liability insurance for foster parents. Two companies provided insurance: United and Colony. Before trial, Colony and United made offers of settlement, culminating in a combined offer of $300,000. No settlement was reached, and the case proceeded to trial, which resulted in a total judgment for the estate and against Jones of over $24 million. Jones appealed.

On appeal, the court addressed: 1) whether a foster child in Oklahoma has a “contractual or statutory” relationship with the insurance company that provides foster care liability insurance to a foster child’s foster parent, such that the insurer owes the foster child either a contractual obligation or an implied duty of good faith and fair dealing; 2) whether a judgment creditor may garnish a judgment debtor’s insurance policy in excess of the insurer’s actual liability to the judgment debtor; and 3) whether a Defendant’s status as intervenor in a co-Defendant’s cross-claim against a plaintiff is relevant to mattered adjudicated solely between defendant and plaintiff.

The Tenth Circuit held that the answer to all three questions was no. Accordingly, the Court AFFIRMED the judgment of the district court.

Tenth Circuit: Evidence Sufficient to Support Mandatory Sentence to Life in Prison

The Tenth Circuit published it’s opinion in United States v. Bagby on October 17, 2012.

Defendant Bagby was convicted of possessing, with intent to distribute, fifty grams or more of crack cocaine. Because of his prior felony convictions, he received a mandatory minimum sentence of life in prison. Defendant appealed his conviction.

The Tenth Circuit found the evidence sufficient of constructive possession of the crack cocaine because a reasonable jury could find that Defendant had an appreciable ability to guide the destiny of the drugs.

Further, Defendant’s statements to the police the evening the drugs were found provided sufficient evidence from which a reasonable jury could find that Mr. Bagby owned the drugs.

Defendant also objected to the stipulation to the unredacted indictment, which included his prior felony counts. The indictment was read to the jury with the rest of the instructions. The Tenth Circuit concluded that the reading was non prejudicial, even if it was error, since the evidence against Mr. Bagby was so overwhelming.

The Court further found that the admission of his “penitentiary pack” (his correctional history) did not affect his substantial rights, and found no plain error in the joinder of the counts.

Finally, Defendant objected to the sentence enhancement that mandated a minimum of life imprisonment without release. The Tenth Circuit found any error committed by the district court was harmless. AFFIRMED.

Colorado Court of Appeals: Announcement Sheet, Week of October 18, 2012

On Thursday, October 18, 2012, the Colorado Court of Appeals issued no published opinions and 30 unpublished opinions. Neither State Judicial nor the Colorado Bar Association provides case summaries for unpublished appellate opinions. The case announcement sheet is available here.