The Mere Violation Of A Technical Rule Has Often Been Deemed Sufficient For Legal Action And Recovery
Businesses in California are facing, among other things, 100-400% increases in workers' compensation premiums, increasing employer mandates, and high tax and regulatory burdens. Unfortunately, a certain litigation strategy threatens many companies in an environment ripe for abuse. California's Unfair Competition Law is unique in that it allows anyone to sue businesses for alleged unfair business practices, even if they have not directly incurred the alleged wrongdoing, and even if no one was actually harmed. The mere violation of a technical rule has often been deemed sufficient for legal action and recovery. For example, small nail salons are being targeted for using the same bottle of nail polish on more than one customer and a motorcycle shop was sued for abbreviating the words "on approved credit" (OAC) on a print ad. This shift from traditional tort law requirements, such as proving actual injury, has contributed to an atmosphere that is most appealing to practitioners of the art of shakedown. Some law firms threaten small businesses with suits unless they settle to avoid exorbitant fees and costs and limit risk of an unjust, arbitrary action. Many of the businesses targeted by these unfair competition suits or claims are small, minority owned businesses guilty, at most, of minor, technical, or administrative violations, often unknowingl
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