CABIA Rallies on the SCOTUS Steps for PAGA Reform Now – Opinion

Here is the problem with getting people to care about the Private Attorneys General Act (PAGA) and its deleterious effects on small business in California: it’s a complicated morass—intentionally made so by plaintiff’s attorneys, in order to erode the power of the employer and business owner to run their business as they see fit. The erosion has a negative impact on employees’ quality of work and their flexibility. It also affects bonuses and promotions as well as workplace safety and security. Why hasn’t your boss given everyone a raise in two years? Perhaps because the boss had to make a PAGA claim, and all of his or her coffers are empty.

Blaine Eastcott (California entrepreneur), is the owner of Rockcreation Climbing clubs.

“I [would]To pay the bill, you will need to take out a loan [a PAGA lawsuit] off, which means if I am paying a PAGA lawsuit, I’m not paying my employees a better wage.

I’m not paying the bonuses when, you know Christmas rolls around, or the company does better, because it’s burdened by these loans. I’m not buying amenities that improve the operation for the community of people that use the facilities.”

Doesn’t get more bottom line than that. The taxpaying public is still blissfully ignorant of the impact PAGA has on their lives and communities.

The Supreme Court appears to be taking a new interest in Federal Arbitration Act, and any lawsuits that may add to PAGA’s morass and the FAA’s end-runs. The following is a case the SCOTUS justices reviewed: Viking River Cruises, Inc. v. Moriana. Because a favorable decision for Viking River Cruises, the petitioner in this case could significantly limit PAGA damages and cause reforms of the Act, it has been closely monitored.

Wednesday saw oral arguments from this case before the Supreme Court. This was the ideal opportunity for California Business and Industrial Alliance’s (CABIA), to host a rally at the Supreme Court steps to raise awareness about PAGA abuses and to represent the interests of those who were adversely affected.

PAGA can make a lot of money for both the State of California, and the attorneys who file these claims. CABIA posted a blog post about an attorney that brags on his license plate the amount of money he makes from PAGA claims.

Daniel Gaines hails from Gaines & Gaines law, a firm well-known for filing lawsuits under the Private Attorneys General Act (PAGA). In fact, the firm ranks 4th in California for the number of PAGA claims it files.

You might think that someone who makes a living filing frivolous lawsuits against unsuspecting small businesses might not flaunt their profession; with Gaines, it’s quite the opposite.

It has recently come to our attention that Gaines drives a white Rolls Royce proudly bearing the license plate “MR PAGA.” We couldn’t believe it either, but as they say: A picture is worth a thousand words.

Trial attorneys have been profiting off of PAGA lawsuits for too long, and our state’s businesses have suffered for it. It’s bad enough that these attorneys have made careers out of going after entrepreneurs, but to advertise it so blatantly (on a Rolls Royce no less) just adds insult to injury.

Named and shamed. It is obvious that anyone would want to own a Rolls Royce bearing this license plate. If SCOTUS decides in favor Viking River Cruises petitioner, it will render this lawyer and all his ilk useless. Also, they want to be sent back to ambulancechasing.

CABIA will continue to support these California companies and submit an amicus brief in coordination. Viking River Cruises Inc. v. MorianaIt was an integral part of it.

It was also an ambitious undertaking. California business owners sacrificed their time to travel over 3,000 miles and tell their stories. Oral arguments will determine whether Viking is granted their petition and whether PAGA is weakened or reneged on by the highest court of the land.

From the SCOTUS blog:

This case involves PAGA, California’s Private Attorneys General Act. Any employee may bring an action against their employer and assert claims on behalf of the entire workforce. One example: In the recent PAGA lawsuit against Lyft, an employee filed claims for more than 500k Lyft drivers. Other cases that involve tens to thousands of employees would be routine. To explain further, PAGA authorizes any individual employee to bring any claim that the employer has violated California’s Labor Code; 75% of the award goes to the state and the remainder is distributed to the aggrieved employees as a group. Angrie Moriana, the employee in this case, sought to have PAGA relief against Viking River Cruises. The claim was that Viking River Cruises had failed to pay her wages and failed to pay overtime. Viking argued that the action should fail because Moriana’s employment agreement called for individualized arbitration of all disputes about her employment with Viking and explicitly waived her right to assert such claims through PAGA.

John Loudon, a former California businessman who is also a former Missouri senator, has been appointed Vice President for Government Affairs at CABIA. Loudon was present at the Rally and shared these words.

“What’s so sinister about PAGA is that it’s a conspiracy of the plaintiff’s bar of the state inspiring to suck money out of companies on the back of workers.”

This tactic is all too familiar to progressive governments and unions. Use the workers as the face of “reform” in order to enrich themselves.

This must be ended.

California’s courts are continuing to support the victims, however. mo’ moneyattorneys, to uphold decisions that support PAGA. One of many reasons it reached the Supreme Court is because of this.

It surprised nobody when the Supreme Court granted review. Viking argues that the decisions of the California courts are a flagrant departure from the Supreme Court’s rulings in the area and that a decision in its favor follows directly from Concepcion. For Viking, Moriana’s agreement to individualized arbitration means that neither courts nor legislatures in California have the power to move the dispute to another forum or to aggregate the claims of multiple employees in the same proceeding. It argues that the same problems that motivated the Supreme Court to reject California’s mandate for class-based arbitration compel rejection of the PAGA proceeding here. The most obvious is that a PAGA proceeding with claims by tens or thousands of employees would be so different from bilateral individualized arbitration proceedings, it will ruin the efficiency Viking River has claimed.

Following the rally, I listened carefully to oral arguments. Although the justices were somewhat tense, they weren’t too contentious. Most striking was the sudden interest that Justices Elena Kagan (Stephen Breyer) and Sonia Sotomayor had in federalism. If you read their dissent in the 6-3 decision to strike Biden’s employer vaccine mandate, the government is the be-all, end-all over corporations, and they have no right to oppose any inroads made through federal fiat.

But they seem to not have any problem with state-engineered FAA solutions. PAGA is, in essence, the King of this. And other state lawsuit bars are beginning to pay more attention. California leads the way… in enriching corrupt lawyers nationwide.

Justice Sotomayor, as was the case in oral arguments about vaccine mandates, again proved herself to be uninformed. She used information she had been spoonfed to answer her questions. She argued with the counsel for Viking, Paul D. Clement, that the company was seeking to destroy the state’s ability to enforce its labor law violations.

SOTOMAYOR: That’s what you’re banking on. You’re banking on destroying the state’s mechanism for enforcing its law –for enforcing labor law violations, aren’t you?

MR. CLEMENT: No, Justice Sotomayor, we’re not. Moriana may still file her claims. Those claims are backed by attorneys’ fee provisions.

Mr. Clement held his own with the Justices’ questions, the conservative policymakers I spoke with felt good about the tenor of the arguments.

Californian business owners are fighting to reform PAGA.

Rally Highlights and my commentary.

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