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Calif. gov's sweeping vetoes upsets plaintiffs bar

Amanda Bronstad / Staff reporter
October 02, 2008

On Tuesday, the last day on which he could sign or veto legislation for the year, California Governor Arnold Schwarzenegger vetoed more than 100 bills, including several that would have benefited the state's plaintiffs' bar.

Key among them was Assembly Bill 1945, which would have required health insurance plans to get regulatory approval before rescinding, canceling or cutting back on individual policies. The bill added that a "willful violation" of such provisions would result in a crime.

In a veto message, the governor said the bill would increase costs and lacked several provisions he had proposed to the legislature.

"This bill was written by the attorneys that stand to benefit from its provisions," he said. "In rushing to protect a right to litigate, the proponents failed to consider the real consumer protections that are needed."

John Sullivan, president of the Civil Justice Association of California, a tort reform group in Sacramento , praised the governor's decision. Given the language of the bill, "all these cases would have ended up in court," he said, even if a health service provider had made a simple mistake.

Don Ernst, president of the Consumer Attorneys of California, and a partner at Ernst & Mattison in San Luis Obispo , Calif. , said the bill has support from numerous medical associations and Republicans.

"Governor Schwarzenegger is making lawyers the scapegoat for his failure to protect consumers," Ernst said. "AB 1945 unequivocally banned health insurance companies from wrongly rescinding the insurance of honest consumers."

The governor also vetoed Senate Bill 1113, which would have allowed expert witness fees to be granted to plaintiffs in successful public interest cases, such as those alleging discrimination. In a veto message, the governor said: "Broadening already substantial awards could encourage more unfounded litigation and exponentially increase liability in potentially unjustifiable situations. During a year where the economy is struggling to get back on its feet, the effects could be devastating."

Another bill, Assembly Bill 437, would have allowed the legislature to reject the U.S. Supreme Court's interpretation in Ledbetter v. Goodyear Tire & Rubber Co., 127 S. Ct. 2162 (2007), which said race or gender discrimination suits over equal pay should be filed no later than 180 days after an employer made the decision on which the claims are based.

The bill "would create uncertainty regarding the accrual of the statute of limitation for wage discrimination," the governor wrote in a veto message. "This uncertainty will undoubtedly lead to unnecessary litigation."

The governor also vetoed some bills that would have loosened the protections of arbitration.

On judicial appointments, Schwarzenegger vetoed Assembly Bill 2095, which would have required him to divulge to the public the names of individuals who evaluate or select judicial applicants for him. In his veto message, the governor said the bill would have "a chilling effect upon people willing to provide candid information, and would subject individuals to political lobbying from various sources."