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Democrats in the California Assembly cobbled together a bare majority late Thursday to pass their half of a legislative package aimed at revising the state’s unfair competition law. AB 95, by Assemblywoman Ellen Corbett, D-San Leandro, squeaked by on a 41-35 vote — an hour after an initial roll call failed to come up with enough votes to pass the plan. Republicans and some moderate Democrats blasted the proposal, saying it didn’t go far enough to reform Business & Professions Code, 17200. Opponents said it would not prevent unwarranted lawsuits and pointed out that many businesses that have been victims of unfair competition suits are opposed to it. Members also spoke against a provision in the companion Senate bill, SB 122, which would allow plaintiffs to seek disgorgement through fluid recovery and cy pres awards. Approved by the Senate on Wednesday by a vote of 22 to 15, SB 122 is double-joined to Corbett’s bill, which means that both have to pass in order for the changes to become law. Assemblywoman Carol Liu, D-Pasadena, said she agreed to support AB 95 despite her opposition to disgorgement. “I think [disgorgement] could hurt small businesses,” Liu said. “I will not be able to support disgorgement.” Liu threw her support behind AB 95 after Corbett agreed to consider amending the bill to require that the attorney general and district attorneys be notified when a 17200 suit is filed. Together, AB 95 and SB 122 add several checks designed to discourage lawyers from filing frivolous 17200 suits. They would require plaintiffs bringing such suits to send a notice to every defendant informing them of their rights under the statute, require judges to review all settlements and prevent plaintiffs from joining defendants together in an action just because they’re in the same business. But Assemblyman Robert Pacheco, R-Walnut, said AB 95 would not prevent abuses of the process. “This bill does absolutely nothing,” Pacheco said. There needs to be a “threshold requirement that prevents filing of a lawsuit. There has to be some harm incurred by plaintiffs.” Assemblyman Lou Correa, D-Santa Ana, said he decided to vote against the measure based on who was supporting it and who was opposing it. Correa has been an outspoken supporter of efforts to revise the unfair competition law. “My constituents — small auto shops, nail salons, restaurants — most victims [of 17200 lawsuits] are opposed to the bill,” Correa said. But Assemblywoman Hannah-Beth Jackson, D-Santa Barbara, said the bill would prevent abuse of 17200 and weed out bad lawyers. “There have been abuses by a few firms,” she said. “By virtue of this measure they will be thrown out of practice. The bill also gives disincentive for bad actors to come in — they will be disgorged of their profits.” Corbett rejected arguments that the bill does not help small businesses, saying it was “one of the most ironic and despicable parts of the discussion.” “Some say we should sit on our hands and do nothing because it doesn’t go far enough,” she said. “It goes a long way. Don’t listen to those who are behind wiping out a landmark consumer protection act.” The Consumer Attorneys of California, which supports the Assembly and Senate bills, said in a release that the package “will stop further abuse of 17200 dead in its tracks.” Corbett’s bill will now move to the Senate Judiciary Committee, while SB 122, being carried by Sen. Martha Escutia, D-Montebello, will be taken up by the Assembly Judiciary Committee.

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