California is tightening restrictions on lawyer solicitation practices through AB 2039, signed into law by Governor Gavin Newsom. The legislation establishes a $25,000 civil penalty for each violation of the state’s ban on “capping,” a practice in which attorneys pay people or businesses to help them recruit clients. The new law also requires the State Bar of California to seek the disbarment of attorneys found engaging in the practice rather than resolving cases through settlements.
Legislative Response to Los Angeles County Settlement Claims
Assembly member Rick Chavez Zbur sponsored AB 2039 following reporting by the Los Angeles Times regarding alleged false claims submitted under a $4 billion sexual abuse settlement. Last year, Los Angeles County reached the settlement to resolve more than 6,800 sexual abuse claims dating back to 1959. Legislative staff analyses and reporting indicated that a plaintiffs’ law firm, Downtown LA Law Group, represented nine individuals who stated they were allegedly paid to file claims under the settlement, and that some of those submissions were false.
The Downtown LA Law Group did not respond to requests for comment regarding the allegations on Monday, though the firm has previously denied wrongdoing. Both the Los Angeles County District Attorney’s Office and the State Bar of California have launched their own investigations into the false claims.
Stiffer Penalties and State Bar Enforcement
Prior to the enactment of AB 2039, California law already prohibited the practice and barred attorneys from hiring people to solicit clients in places such as hospitals and prisons. The new statute expands enforcement mechanisms by introducing direct financial penalties and altering how the state bar handles attorney discipline for this specific misconduct.
George Cardona, the chief trial counsel for the State Bar of California, addressed the legislative change in an official statement. “The State Bar of California welcomes the enactment of AB 2039 and is committed to fully implementing its provisions,” Cardona stated.
The legislation received backing from the Consumer Attorneys of California, a trade group. A spokesperson for Governor Newsom did not immediately respond to requests for comment following the bill’s signing.
Summary of California AB 2039 Penalties
- Civil Penalties: Imposes a $25,000 fine for each violation of the state’s anti-capping statutes.
- Mandatory Disbarment Action: Requires the State Bar of California to pursue disbarment rather than settling disciplinary cases for attorneys found to have engaged in the practice.
- Investigation Scope: Supplements ongoing probes by the Los Angeles County District Attorney’s Office into false claims tied to high-value municipal settlements.
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