ADA Defense – know when to fold ’em.

In the classic Kenny Rogers song “The Gambler” a mysterious stranger advises him to “know when to hold ’em, know when to fold ’em, know when to walk away and know when to run.” You can’t walk or run away from an ADA lawsuit, but a spate of new decisions illustrate the dangers of not knowing when it is time to stop fighting and start settling.

I’ll start with Kalani v. Nat’l Seating & Mobility, Inc., 2014 WL 1665226 (E.D. Cal. Apr. 25, 2014), a typical ADA lawsuit claiming problems with parking and an accessible restroom. The defendant contest the truth of the plaintiff’s allegations, arguing instead that some of the evidence in a summary judgment proceeding was inadequate. After thinking the matter over in a Motion for Reconsideration the Court granted the plaintiff statutory damages under California’s Unruh Act. The damages were not large ($4,000), but as other cases show choosing to fight on procedural rather than substantive grounds can cost far more when it comes time to award the plaintiff attorney’s fee. And of course all the money spent on the non-substantive defenses was completely wasted.

Griffin v. J.A.R.S., LLC, 2014 WL 1600315 (S.D. Fla. Apr. 21, 2014) is another decision that might be regarded as a prelude to the fight over attorney’s fees. In Griffin the defendant claimed that the complaint was inadequate because it referred to violations of “Section 208” of the ADA standards. As examples the defendant cited specific parts of Section 208 that would not apply to the defendant. The Court was not impressed, writing that:

Defendants point to parts of Section 208 that they have picked and chosen and that they know do not apply to them and use those aspects of the Standards to argue that Section 208 as a whole does not apply to them when they know full well that the general parts of Section 208 do appear to apply to them. Worse yet, they appear to attempt to hide the relevant parts of Section 208 by attaching only the irrelevant parts of the Standard to their Motion. This does not comply with the duty of candor to the Court, and it is frivolous at best and disingenuous at worst. Defendants’ other challenges to the Complaint are similarly without basis, and the Court will not belabor this Order further pointing out the faults with them.

Losing this particular motion to dismiss probably stung, but losing the Court’s confidence in the defendant’s honesty is likely to be very expensive in the long run.

Lema v. Comfort Inn Merced, 2014 WL 1577042 (E.D. Cal. Apr. 17, 2014) is a case in which the defendant’s tactics resulted in a higher award of attorney’s fees to the plaintiff. In Lema the defendants refused to settle the substantive claims in the lawsuit because the plaintiff failed to produce billing records. The defendants argued that without the records they could not settle the attorneys fee claims. The court, which referred to the defendants’ “extensive delaying tactics,” refused to adjust the plaintiffs fees on this basis. It noted instead that if the defendants had settled the substantive claims — which did not seem to be disputed — they would have eliminated the cause of action giving rise to attorney’s fees and thus limited further fees. By refusing to settle the substantive claims the defendants gave the plaintiff to continue incurring recoverable fees.

Finally, in Hernandez v. Grullense, 2014 WL 1724356 (N.D. Cal. Apr. 30, 2014) the defendants managed to turn a judge with grave doubts about the plaintiff’s attorney’s claim for fees into an award of very high fees simply because they refused to admit the obvious; that is, that the property was not ADA compliant. To understand the case it is helpful to start with the Court’s attitude toward the plaintiff’s lawyers:

This motion presents the problem of determining a fair award in an uncomplicated ADA matter to an experienced law firm that has been repeatedly criticized for the same unreasonable billing practices that it used in this case.

This sounds like the prelude to a defense victory, but after a detailed analysis of the plaintiff’s claim for fees the Court ended up cutting the fees only to a level already offered by the plaintiff’s at the original settlement meeting. The Court’s explanation is educational:

the defendants chose to contest liability instead of promptly conceding that their premises violated the ADA. If they felt Hernandez’s settlement position was unreasonable, they could have made a Rule 68 offer much earlier than they did to cut off the inevitable growth of plaintiff’s fees and costs. I will not protect defendants from the consequences of their litigation decisions. I will not speculate that the parties would have settled at the mediation if Rein had quoted an amount of fees and costs commensurate with this Order’s analysis.

The final award of fees to the plaintiff for a case that “required scant discovery and motion practices and resulted in a $10,000 payment to its client and up to $25,000 in remedial costs at the premises of the defendants” was more than $50,000, plus more than $11,000 in costs. This is apart, of course, from the money spent by the defendant on its own attorneys.

I often say that defendants should “fix first, then fight.” I suppose these cases will require me to point out that it isn’t useful to fight about non-substantive matters, because such fights only drive up the costs of litigation. ADA plaintiffs and their lawyers are often unattractive litigants, but a defendant who decides to get down and dirty in the fight instead of taking the high ground is likely to find himself tarred by the same brush he tries to use on the plaintiff. This is the worst kind of loss, because the defendant pays everybody’s lawyer and incurs all the costs of remediation. “Fix first, then fight about things that matter.”