South Bay Business Owners Targeted by Serial ADA Lawsuits

Gary Burton took over day-to-day operations at Diamond Laundry and Cleaners when he turned 23, just after he left the service. Running the family business freed up his parents to travel the world and gave him a chance to settle down. Forty-five years later, he sits behind the same worn desk in the same mid-century building at San Carlos Street and Delmas Avenue. He pays out of pocket to keep the shop afloat.

“I do this for my mom,” Burton says, gesturing toward the front desk where 92-year-old Mary Burton comes in every day to greet customers and chitchat with employees. “I can’t let her sit at home and do nothing, so I keep this going for her.”

But a lawsuit filed last year could change all of that.

“It was like a sinking feeling,” Burton says, recalling a young man who came into the front office with a stack of white papers summoning him to court. “I knew I was in over my head.”

About seven months ago, Burton found himself the target of serial plaintiff John Ho. Identified in court papers as a wheelchair-bound paraplegic from the Southern California town of Rosemead, Ho claimed that while vacationing in San Jose, he tried to drop off some laundry at Burton’s shop but couldn’t finish the errand because there was no designated handicapped parking. He asked for $10,000 in damages.

Burton settled for $7,000, plus another $5,000 in attorney fees, which he paid for again from his own savings in lieu of filing the business for bankruptcy. He has two years to paint in some disabled parking spots, which would have cost all of $300 in the first place.

“I probably won’t be in business that long,” Burton says. “Another two years to comply? That’s fine, but I don’t know if it’s worth it or if I can afford to keep subsidizing this. I just wish someone pointed it out to me before taking me to court. I thought I was grandfathered in.”

Nearly 80 businesses in San Jose and several more throughout South Bay have been hit by one of Ho’s lawsuits, which allege violations of the federal Americans with Disabilities Act (ADA). In the court filings, Ho—who has not been seen by anyone interviewed for this story—says he was denied his right to access several businesses because there was no handicapped parking, wheelchair lift or some other accommodation. Most of the lawsuits have been filed over the past two months in Santa Clara County Superior Court. They claim that Ho visited dozens of business during the first week of May 2012, including Hydration Coffee and Tea, La Victoria’s taqueria, Burton’s dry cleaners, several motels, Santo Market in Japantown, a strip mall in Mountain View, and dozens of other retailers and restaurants. Ho was apparently a very busy man while vacationing in the area.

Multiple calls to the plaintiff’s landline went unanswered, and his law firm also did not return calls for comment. But an Internet search shows Ho is no stranger to litigation. The San Gabriel Valley resident has filed several hundred civil suits against businesses in San Diego, Fresno, Inland Empire and, now, the Bay Area. And he’s not alone.

A man named Cecil Shaw has filed hundreds of lawsuits in federal court through a San Jose-based law firm alleging similar violations.

ADA lawsuits have become a multimillion-dollar industry. Across the country, communities are being hit with serial claims, often a hundred or more at a time. Law firms team up with disabled clients to inspect businesses for compliance issues, and then sue in droves, expecting half or more defendants to settle out of court.

The New York Post called one such serial plaintiff, wheelchair-bound Zoitan Hirsch, “hell on wheels.” The New York City double-amputee filed 87 federal claims in a single year, leading the newspaper in 2011 to question whether he’s a crusader or a con man.

Similar ethically ambiguous cases have plagued small businesses since the advent of disability access laws. Some Southern California lawsuits were tossed after defendants were able to prove the plaintiffs never visited the spots they claim to have been denied access, having instead relied on law firms to look up businesses on Google Street View to check for possible violations.

“Generally, you will find that once a serial plaintiff’s credibility has been damaged, they will to go another location,” defense expert David Warren Peters told the Orange County Register, “[though they may] have difficulty in finding ethical lawyers to represent them.”

On the state level, Gov. Jerry Brown signed a law in 2012 in an attempt to curb abuse of ADA claims. It protects a business targeted by litigators if the company already hired a consultant to check for compliance and limits mandatory damages to just $1,000 instead of $4,000 in some cases. AB 1186 also banned demand-for-money letters, which lawyers have sent to businesses and landlords asking for a set amount in exchange for dropping the case.

Some downtown business owners in San Jose doubt Ho was truly able to visit the several-dozen businesses he claims to have frequented on Cinco de Mayo weekend in 2012.

“You really question what the motive is here,” says Scott Knies, executive director of the San Jose Downtown Association.

Councilman Sam Liccardo calls the lawsuits an abuse of a well-intended law, a shakedown that targets small businesses. His office pulled together an emergency meeting last week, bringing in lawyers, defendants, community leaders and a restaurant lobbyist to devise a game plan for how to deal with Ho.

“The law rightly and appropriately protects the rights and access of people with disabilities, but like all laws it can be abused by lawyers who have enough time on their hands,” Liccardo says.

The problem for targeted business owners is that Ho is often correct in his complaints. It’s easy to find restaurants and retailers out of compliance, especially if they’re small and run out of a building that predates ADA laws. A little more than a year ago, 92 of about 300 lawsuits Ho filed in Los Angeles County reportedly opted to settle for a collective $554,000 (and possibly more). It’s unclear how much of that went to his attorney, Raymond Ballister of the San Diego-based Center for Disability Access.

The California Restaurant Association keeps tabs on career plaintiffs and generally gives business communities a heads up if they spot a flurry of legal activity in a given region, says spokeswoman Angie Pappas.

“I think everybody in the restaurant industry would agree that businesses should be accessible and they should be held accountable to these legal standards,” she says. “But a lot of these lawsuits are more about playing gotcha with business owners and not truly an effort to correct a violation.”

Marejka Sacks, of Moore Law Firm in San Jose, says people like her client, Shaw, view themselves as champions of the ADA. Building inspectors are supposed to tell businesses and property owners how to become ADA-compliant, but they often sign off on new construction or remodels without spotting a violation.

“Ignorance of the law is no defense in court,” Sacks says.

Niccandro Barrita wishes a building inspector had pointed out access deficiencies to him when he bought up the old Victorian on East San Carlos Street, where he runs one of four La Victoria Mexican restaurants.

“I didn’t know any better,” he says.

At the losing end of a few lawsuits, including one leveled against him by Ho, Barrita knows better now. Six years ago a man named Armando Rodriguez, who has relied on a wheelchair to get around since a 2006 car crash rendered him paralyzed from the waist down, went to La Vic’s after a doctor’s appointment. He remembered enjoying the place before his near-fatal crash, according to court statements.

“When Rodriguez … pulled up to the restaurant, [he] noticed that there was a stairway leading up to the front entrance,” documents recount. “He further observed that there was no lift or ramp for persons in wheelchairs.”

The resulting lawsuit asked for tens of thousands of dollars in damages and demanded Barrita install a wheelchair lift. It would have been a $30,000 preemptive fix, but Barrita fought it in court on grounds that the city had signed off on all the permits to operate.

“I lost,” he says. “I thought because when the building was remodeled in 1996 and the city waived the lift requirement that I was in the clear. But that wasn’t the case.”

Six years later, Barrita finally settled all claims. He has had to shell out $900,000 in attorney fees, he says, to cover the ordeal. He adds that only $12,000 will go to the plaintiff.

“You have to be proactive,” Barrita says. “Don’t rely on someone to point out a deficiency to you. Find out for yourself if you’re compliant.”

Jennifer Wadsworth is a staff writer for San Jose Inside and Metro Newspaper. Email tips to [email protected] or follow her on Twitter at @jennwadsworth.

4 Comments

  1. why are you addressing this issue again.  It is a total lawyer scam!  How is this not a crime when they threaten to sue you if you do not pay them.  This is not about a handicap access issue when they shack you down for a cash settlement and use a poster child as some poor person who cannot access a business which they would never set foot in to begin with.

    • I agree. Looks like criminal activity. I don’t know how they get away with it. Someone should let them know that they have picked on the wrong city to do this sort of thing.

  2. You all are correct. It is “legalized extortion” but the key is that it is legal because no one is putting a stop to it. Everyone is afraid that if they say “stop it” they’ll look like they’re bullying the disabled. The problem is that I’m defending these lawsuits and my clients have to deal with them on a daily basis. If you can pass along this atrocity to your friends and they can pass it along to theirs, maybe we can make some changes. Maybe there can be a requirement that the disabled person actually suffer an injury and get rid of the attorneys’ fees provision. The thing driving this is the attorneys’ fees. The disabled person gets near nothing for being a plaintiff, but the attorney is making a fortune at $5,000 nearly daily. Can you imagine making $5,000 a day?

  3. > Maybe there can be a requirement that the disabled person actually suffer an injury and get rid of the attorneys’ fees provision. The thing driving this is the attorneys’ fees.

    It’s also what’s driving much of the “environmentalist” lawsuits.

    It’s legalized societal theft benefiting trial lawyers.