This year has seen an unprecedented increase in bills filed containing private rights of action. A private right of action specifically authorizes bringing a lawsuit as an enforcement mechanism for the subject matter of the bill. Some bills contain dual enforcement mechanisms that allow a government agency or the Attorney General to enforce, but also allow a civil lawsuit to be brought in addition to agency enforcement. These provisions are inserted in bills at the behest of the plaintiffs’ bar as they benefit most from this needless increase in litigation.
Private rights of action are problematic for several reasons:
1. Inconsistent Outcomes: Private rights of action result in inconsistent outcomes across different cases. The interpretation and application of laws may vary, leading to varying rulings and creating confusion and uncertainty. Enforcement by an agency of the state ensures more consistent enforcement and outcomes. Plaintiffs’ lawyers do not have an incentive to promote consistent approaches that advance public policy objectives.
2. Burden on the Legal System: Private rights of action lead to an increase in litigation, burdening the legal system and resulting in higher costs for both individuals and businesses. This can strain court resources and slow down the resolution of cases.
3. Potential for Abuse: Allowing private rights of action create opportunities for frivolous lawsuits and abusive litigation practices. This can lead to a misuse of the legal system, wasting time and resources.
Recently, several bills containing private right of action provisions moved forward in the state legislative process.
In the House of Representatives, H.B. 1378 received second consideration. This legislation, which aims to prohibit scalpers from using software to make bulk online purchases for the purpose of reselling the items at a higher price, includes a private right of action provision. In a memo to House members, the Pennsylvania Coalition for Civil Justice Reform (PCCJR) highlighted the detrimental effects of such provisions, and suggested that the bill be amended to give the Attorney General exclusive authority on enforcement. HB 1378 is now awaiting third consideration before going to the Senate for deliberation.
The House Consumer Protection, Technology and Utilities Committee also reported H.B. 1658 out of committee. The legislation seeks to ban speculative ticketing – but also contains a private right of action provision. PCCJR once again raised concerns regarding the negative outcomes that can result from such provisions. An amendment has been filed giving exclusive jurisdiction over enforcement to the Attorney General and removing the private right of action provisions.
The Senate Labor and Industry Committee recently approved S.B. 577 by a vote of 10 to 1. The underlying purpose of the legislation is to address the misclassification of construction workers as independent contractors. However, the language also contains private right of action provisions – despite the legislation already providing enforcement powers to the Secretary of Labor and Industry and the Attorney General. In a memo to committee members, PCCJR noted that a dual enforcement mechanism such as a private right of action is unneeded and detrimental to the consistent and equitable enforcement of the law. Additionally, the Department of Labor and Industry has the tools and expertise to enforce the provisions of S.B. 577.
PCCJR will continue to fight these trial lawyer enrichment schemes and seek to have these provisions amended out of bills or seek the outright defeat of bills containing private rights of action.