Appeals Court Rejects Attorneys' Fees in Lawsuit

Appeals Court Rejects Attorneys' Fees in Accessibility Compliance Lawsuit
On June 30, the Second District Appellate Court of Appeal denied a plaintiff's claim for attorneys' fees in connection with a suit to force a landowner to install a designated van-accessible handicap parking space. In this case (Mundy v. Neal), neither the plaintiff, Thomas Mundy, a paraplegic who allegedly has filed more than 150 lawsuits against businesses in the last 18 months to enforce the Americans with Disabilities Act (ADA) and California State compliance, nor the actual tenant communicated with the property owner regarding the lack of accessible parking prior to the filing of the lawsuit.

When the property owner learned of the lawsuit, he investigated the matter and promptly had the space installed. Mundy dismissed the lawsuit and then filed a motion seeking $3400 in attorneys' fees, arguing that he is entitled to attorneys' fees under a "catalyst" theory because his lawsuit motivated corrective action that "inures to the public benefit," meaning that it had a positive effect.

The court referred to prior case law, holding that the "catalyst" theory cannot be invoked unless the plaintiff made a reasonable attempt to settle the matter before filing the lawsuit. The plaintiff argued that this only applied to laws that allow the court discretion in awarding fees, not those where an award to the prevailing party is mandatory. The court disagreed, holding that whether or not the fee award is mandatory, it is irrelevant and that "if the catalyst theory does not reward an opportunistic lawsuit in one context, it should not reward such a lawsuit in any context."

The outcome of this ruling may make enforcement of accessibility requirements a less lucrative pursuit for lawyers who file so called "drive-by" accessibility suits where businesses suddenly get a letter from an attorney, probably one they do not even know, informing them that they are out of compliance with ADA. The attorney will then settle the case out of court, often for amounts averaging $5000 per case.

For more information about accessibilty requirements, see CAA's Issue Insight: Violations of the Americans with Disabilities Act: The Latest Drive-By Lawsuit.