Senate Standing Committee on Judiciary

Hang on for just a moment here. We'll give them a few minutes, then we'll start as a Subcommitee.

The Senate Judiciary Committee will come to order. We have. We are lacking two Members for purposes of establishing a quorum. I saw several Members just moments ago and asked them to join us. We're lacking just. We got a quorum. All right. Senator Ashby. Oh, don't. Wait a minute. I obviously scared Senator Ashby. Okay. All right.

We're holding this Committee hearing in room 112 of the Capitol. Ask all Members who are Members of the Committee present themselves in room 112 so we can establish a quorum. Let's go ahead and establish a quorum at this time. Madam Secretary, please call the roll for purposes of establishing a quorum.

[Roll Call]

We have a quorum. Alrighty. We have one bill to present today. That's AB 1755 by Assemblymember Kalra. We're going to follow the same procedure as we followed all year, which means that we'll have two primary witnesses in support and two primary witnesses in opposition.

Each primary witness in support will have two minutes to speak, and each primary witness in opposition will have two minutes. Other supporters are welcome to state their name, their affiliation, and their position by approaching the microphone. We'll first take the support, and then we'll take the opposition.

After we hear from the support and opposition, we'll come back to Committee for questions, comments. We can read.

So, if you have other information you would like to communicate to us, you can do so by submitting it to the Committee, by going online and looking at the Committee's website and provide you instructions as to how you can submit written material. All right. With that, let's begin. Assembly Member Kalra. Thank you.

Thank you so much, Mister Chair. AB 1755 is a joint Kalra Umberg bill to address the rapidly growing backlog of civil cases involving disputes over California's lemon laws. Since the end of the pandemic era restrictions on court hearings, the number of lemon law related lawsuits filed in California has doubled.

In fact, judges report that in LA County alone, Lemon law cases now represent 10% of all civil filings in the county. The corresponding increase in discovery disputes, protracted settlement negotiations, and disagreements regarding fees are significantly delaying many California's ability to replace a defective car with a safe and reliable form of transportation.

AB 1755 represents a compromise between the consumer attorneys, defense attorneys, and some auto manufacturers, most notably General Motors. The compromise has three primary components. First, the bill adopts new pre-litigation procedures designed to keep disputes from ever going to court. Consumers must now inform manufacturers in writing if they want a lemon vehicle bought back or replaced.

Otherwise, they forego the ability to seek civil penalties. Manufacturers receiving this notice must agree to replace the vehicle within 30 days or else a consumer may go to court. If the parties reach an agreement, the manufacturer must complete the repurchase or replacement of the vehicle within 60 days.

Second, in the event a lawsuit is filed, the bill adopts streamlined early discovery and mediation. Parties must provide a mandatory set of documents and discovery within 60 days of the defendant responding to the lawsuit. The plaintiff and defendant must submit to a deposition within 120 days of the defendant's response. Both parties must attend mediation within 150 days.

Finally, both sides must have a person capable of settling present at the mediation. The parties may seek extended discovery and litigation only if the early discovery and mediation fail.

I want to clarify that amendments adopted this morning clarified that any response from a defendant triggers discovery timelines, not just an answer, thus eliminating any chance for game-playing by litigants. The bill also enhances certainty in litigation timelines and settlements.

The bill narrows the timeline for filing lemon law cases to one year after the final warranty expires, or six years total from delivery of a vehicle. This is still more generous than other states. 47 states limit their lemon law remedies to the year or two after a car's purchase, or 18 to 24,000 miles.

Finally, the bill expedites settlement completion by providing one standard statutory form for repurchase replacement agreements, thus eliminating the need for negotiations requiring a settlement to be completed in a timely manner or else both sides face possible civil penalties and sanctions, and requiring the manufacturer to provide the consumer a check or a new vehicle at the time the lemon is turned in.

These consumer-friendly changes seek to promote timely resolution of cases outside the court when possible. Lastly, let me briefly address some concerns that have been raised by the opposition and note what the bill does not do. The bill does not alter any fundamental rights under existing lemon laws.

Much like today, manufacturers are obligated to conform vehicles to their warranty. Similarly, this bill does not cancel any warranty if a warranty issue arises at any time during a warranty's existence, the existing law related to warranty contracts still applies. The statute of limitations bill does not impact the warranty claims.

This bill does not shift any burdens on plaintiffs. It merely codifies existing practices and on the ground, realities related to notifying manufacturers about a car being a lemon and only applies these to actions seeking civil penalties. This bill does not alter a manufacturer's affirmative duty to replace lemons.

Once a vehicle hits the requisite number of repairs, it should be replaced or repurchased, and damages can begin accruing at that time. This bill does not delay litigation or permit nefarious litigation tactics. Rather, this bill streamlines discovery and adopts sanctions for bad behavior.

This bill does not grant new attorneys' fees. Given that the attorney-client privilege attaches before a lawsuit is filed, fees for pre-litigation activities are typically covered under existing law. This bill does not change that. Finally, this bill does not authorize bulk settlements.

Much like existing law, this bill deals with one plaintiff and one defendant at a time, and in no way authorizes new class actions or the grouping of distinct claims from distinct parties. This bill simply seeks to provide a process for the expeditious resolution of lemon law claims by incentivizing all parties to reach early and amicable outcomes.

Here to testify in support are Greg Rizio, on behalf of the Consumer Attorneys of California, and Mike Belote, on behalf of General Motors.

Thank you. Mister Rizio, floor is yours.

Thank you, Mister Chair. Good afternoon, Senators. My name is Greg Rizzio. I am the Consumer Attorneys of California's immediate past president and one of the chief negotiators on AB 1755.

I think it's important for all of you to know that AB 1755 was negotiated with lemon lawyers from both sides of the fence with the understanding that we weren't going to affect lemon laws, but we were going to fix the court congestion problem.

Sitting on a bunch of boards with judges and lawyers, I can tell you that all of us know that lemon law discovery filings are killing the consumers' rights to get trial dates and to get justice. Since 2022, lemon law filings have doubled from 15,000 per year to 30.

Since 2014, lemon law filings have increased over 25,000 cases a year. That's 30,000 cases that will be filed this year, further congesting courts that are already backlogged from the 2020 COVID pandemic. As I said before, AB 1755 fixes the court's congestion problems by changing the court processes without affecting the consumer's rights. The affirmative duties remain.

The warranty rights remain. AB 1755 imposes strict deadlines on pre-filing procedures to help identify and get lemon cars off the road within 60 days of a complaint.

And if they're not off the road on the 60th day, there is a $50 per day penalty against the manufacturer, a strict sanction that exists nowhere else in the United States of America. AB 1755 also to fix the court congestion, imposed strict deadlines on discovery procedures, procedures that both sides were having things to get done.

They will now get done in a timely fashion. And if they don't, there are extremely strict penalties on the manufacturer, including they would have to pay a higher fine than the consumer, recognizing the disparity in the finances between a consumer and $1 billion company.

And there are trial evidence sanctions that exist nowhere else in the United States where they lose defenses if they do not actually comply. I urge you to vote yes, because it's good for Californians to get these cars off the road and to fix the courts so others can get trial dates. Thank you.

Thank you very much. Mister Belote.

Thank you, Mister chair and Members. Mike Belote, on behalf of General Motors. Just to circle back on a couple of things that were said, cases have gone up sevenfold since 2015. I had to look up the word, it septupled in nine years. People are sometimes, in these cases, two to three years.

There is no way that a consumer should be forced to wait two to three years for relief on a lemon law claim. These are people who need to get to work and get to school. Let's talk about or get their kids to school. Let's talk about what the bill is. It's procedural.

A very substantial number of these cases will be resolved before litigation. What the bill does is it establishes a requirement, consistent with 49 other states, that manufacturers be given a simple demand to do a repurchase or replacement. That goes to this question of willfulness.

We believe that the manufacturer, in order to be found willful and subject to civil penalties, ought to get notice, a simple emailed notice from the consumer that they want a buyback. The bill reforms discovery. This is a key point. We have heard cases where courts have seen literally hundreds of motions to compel discovery in a single case.

This is an automobile claim. This is not IP. This is not a complicated products liability action. There is no reason why there should be hundreds of discovery requests. The bill lays out exactly what sorts of documents should be exchanged early in the case, and we think that will lead to resolution. Also shortened depositions and mandatory mediation.

Finally, it has a standard release. Sometimes lawyers go back and forth months about what the consumer should have to release in order to end the case. And this has a standard release in the statute. It also clarifies the very contentious issue of offsets and damages.

Very quickly, what the bill doesn't do it doesn't amend Song Beverly in any way. And let's be clear about that. That was something GM would have liked. The plaintiff's bar couldn't go there. This does not amend Song Beverly. Nor does it affect the holding in the Seminole case of Croton versus Porsche. It doesn't affect other remedies.

Both express warranties, implied warranties, consumer legal remedies act, and products liability. Finally, it's faster, more efficient, and we'd like to thank the consumer attorneys for their negotiation for months in good faith. Thank you.

Thank you, Mister Belote. And I note that the two witnesses went about five minutes and 15 seconds. And so, for the opposition, I will accord them the same amount of time. All right, thank you. Not yet on the opposition. Let's take support. If you're in support of AB 1755, please approach the microphone.

Give us your name, your affiliation and your position.

Mister Chair and Members. Shawn Tapeckian, on behalf of Ford Motor Company, in support.

Thank you.

Mister Chair and Senators, Cliff Costa today, on behalf of a number of clients, the California Judges Association in strong support, the California Defense Counsel, the Civil Defense Lawyers in strong support. And the RV Industry Association, also in strong support. Thank you.

Thank you.

Mister Chair and Members, Corey Salzillo with WPSs on behalf of Stellantis, in support. Thank you.

Thank you. All right, so now we're going to turn to the opposition. I think I'm going to ask the witnesses who were here in support to vacate for the moment. You may need to come back here in a little while. Ask the opposition to please approach and so you can. Who would like to go first?

All right, as I mentioned, you have additional time, so go ahead. The floor is yours.

Thank you, Mister Chair and Members, I'm Rosemary Shahan, President of Consumers for Auto Reliability and Safety. And I'm testifying behalf on of CARS.

And I've also been designated as a point of contact for a large coalition of the nation's leading pro-consumer auto safety and injury prevention organizations, as well as many leading California-based consumer and economic justice organizations who are listed in the analysis opposed to the bill.

And first, I'd like to give a shout out to council for such a fair and thorough analysis, especially at the end of session. And since 1979, I've dedicated my life to successfully improving California's laws to protect new and used car owners and their families and businesses.

CARS successfully spearheaded enactment of numerous laws over the years, including the 1982 Tanner Act that was signed into law by Jerry Burke Brown. Other laws that were signed by governors Wilson and Schwarzenegger, and to expand the law to cover small businesses, which most states don't cover, and our military families.

And that bill passed unanimously in both houses, expanding protections for military no matter where they buy their cars, and tightening protections against lemons with life-threatening safety defects.

So, instead of having to take your car back four times before it was presumed to be a lemon, and you're entitled to a refund, you had the benefit of the presumption in the Tanner Act. Two break failures. You don't have to keep risking your life. You're entitled to a refund.

CARS and our coalition partners opposed this bill because it would drastically weaken protections for California's new and used car buyers. Briefly, here are just four of the ways the bill would weaken California's recipe for automotive lemonade.

For the first time since 1970, when Governor Bacon signed the granddaddy of the lemon law known as the Song Beverly Consumer Warranty Act, it would deny full lemon law protections for vehicle owners who have warranties that last beyond six years after the car is sold, including emissions warranties and warranties for EV batteries, which are generally longer.

Some of them are mandated. And under the original Song Beverly Consumer Warranty Act, no matter how long the warranty is, the manufacturer is supposed to honor it. And if they don't, if they willfully violate their warranty, they're subject to up to double its discretionary, the amount of your damages.

So, that actually gives them an incentive to fix the car.

Thank you, Miss Shahan. It's two minutes and 54 seconds, so if you'd wrap it up, that'd be great.

Okay, sir. Senator. It would limit the time for bringing a lemon lawsuit to just one year after the warranty expires, harming consumers whose vehicles have latent defects. Now it's four years from whenever the claim arises. It would reduce the amount lemon owners with negative equity would receive as a refund by an average of about $6,000.

And worst of all, it make it harder for most people who never even talk to a lemon law attorney to get their cars fixed under warranty by shifting the burden for flagging when a vehicle is a lemon from the manufacturers who have that obligation now.

Thank you. So, you urge a no vote, I assume

We strongly urge a no vote.

Thank you. All right. Thank you, sir. The floor is yours.

Good afternoon, Mister Chairman, Vice Chairman Wilk and Members of the Committee. My name is Nicholas Johnson and I'm Senior Counsel at Volkswagen Group of America where I've handled lemon law matters for over eight years.

I want to thank you for the opportunity to speak on Assembly Bill 1755. I come before you on behalf of 14 automakers, that's the vast majority of the automotive industry, to respectfully oppose this bill. There can be no doubt that updating the Song Beverly Act is crucial to ensuring fair dispute resolution, safeguarding consumers, and promoting public safety.

Unfortunately, this hasty legislative process, which stemmed from a last-minute deal between one company and one plaintiff's attorney organization, will harm the very consumers it intends to protect. This flawed process has led to a flawed proposal that will ultimately do more harm.

Despite its good intentions, this bill misses the opportunity to make meaningful and common-sense reforms that addresses the real problem that is the ongoing exploitation of California's lemon law, where drawn out litigation denies and delays the very relief requested by consumers and increases the cost for all Californians. Without amendment, this bill will worsen the status quo.

For example, in addition to introducing vague and flawed language into the code, it fails to require pre-suit notice of all SBA claims. It fails to require a vehicle be available for inspection, and it fails to define a compliant offer.

Instead, it codifies additional attorney's fees and imposes disproportionate and draconian evidentiary sanctions against manufacturers that will be manipulated by trial attorneys. Instead of streamlining resolutions, this bill will entrench the very problems it seeks to solve.

The citizens of this state, consumers and industry alike, need for you to take the time to refine this bill with input from all interested parties, to ensure it genuinely benefits the consumers it's meant to serve. Thank you for your attention and consideration. I'll be here and available if you have questions. Thank you very much.

All right, all those who are opposed, if you'd approach the microphone, give us your name, your affiliation, and your position.

Thank you, Chair and Members. Nicolina Hernandez, government affairs for Toyota, in opposition. Thank you.

Thank you.

Good afternoon. Lizzie Cootsona here on behalf of Tesla in respectful opposition. Thank you.

Thank you.

My name is Payam Shahian. I represent thousands of consumers in California for the past 10, 12 years and a former defense attorney represented Ford and lemon law cases, and I oppose the bill.

Thank you.

Good afternoon, Mister chair. I'm Meegan Murray with the Weideman Group on behalf of Lucid in opposition, thank you.

Good afternoon. Carrie Fowler on behalf of American Honda. Thank you for listening.

Good afternoon. Linda White, BMW, in opposition.

Magaly Zagal with Greenberg Traurig, on behalf of Kia, in opposition.

Thank you.

Mister Chair and Members, good afternoon. Kirk Kimmelshue on behalf of Scout Motors, opposed.

Thank you. All right, seeing no one else approaches the microphone. Let's bring it back to Committee for questions and comments. Questions, comments. Seeing no questions or comments. Senator Ashby.

All right, so I have a few questions. First of all, freshman Senator. So first end of two year session, so maybe I'm the only one that feels 1000% jammed up, but new for me. Not new for some Members here. In looking at the law that you're proposing, Assembly Member.

One of the first issues I have is a question about the warranties, because there's nothing in here about assuring that people don't make the warranties shorter or exactly. Warranties are varied. For example, you could have a bumper-to-bumper warranty for three years, but let's say your cooling system goes out and it gets fixed.

You now have a one-year warranty on the fixed parts that they put in. If that breaks again the next year and you fix it again, you have another one-year warranty. And again, and again and again.

So which warranty are we talking about? The warranty that you originally purchased with your car or the warranty that you got again and again and again on the part that broke?

And if it is the latter, if that's outside of the three years or the six years of the original warranty period, then are you now precluded from being able to advance a lemon law claim? Because that's a real issue. Because most consumers say, ah, this part isn't working on my car. Let me get it fixed.

Okay, it's working now. And then a year later, it's not working again. Let me see if I can fix it again. And they will give the car company or the auto mechanic as many chances as they can, so long as it's under warranty.

So, at what point does that process butt up against a person's right to claim that actually they bought a lemon car to begin with.

I'll allow my witness to elaborate, since he did a lot of. But as it currently states, it's one year after the final warranty expires, or six years total from delivery of vehicle.

So, Senator Ashby, that's a good question, but it doesn't affect the, what this law does is it affects the rights to civil penalties. In lemon law, it doesn't affect your warranty rights. Your warranty rights don't change.

So, if your car breaks down the prescribed amount of times under the Tanner Act, you still have the right to bring a civil penalty against the individual as long as you file a email or send a letter to them and say, this is a lemon, please buy it back. There's no magic words to it.

And then you still have a right to file for the civil penalties. Nothing else is changing except the rights to civil penalties.

Tell me your name again. I'm sorry?

My name is Greg Rizio, ma'am.

Greg Rizio. Mister Rizzio. That wasn't the question. The question is which warranty rules.

All warranties are not affected. So.

Sure.

Somebody should use the mic.

He needs a mic.

First of all. So, Assembly Member Kalra.

I think that's. The opposition wants a chance to respond as well, Senator.

My name is Payam Shahian. I represent, I'm here on behalf of strategic legal practices. We've represented more consumers than anyone regarding lemon law in the past 10 years. And my friend wasn't in the room. And nobody knows the lemon law attorneys who were in the room who negotiated this.

And let me just tell you, under this bill, that's an excellent point that you brought up. Right? Because if, you have one warranty, you have one lemon car. And this bill provides different statutes of limitations for different warranties. And no one knows what that is. And I understand that the Committee is concerned about trying to streamline litigation.

This will basically increase litigation now, because which warranty is it? Did the statute of limitation on this warranty expire and not the other? You could have a car with like seven or eight battery complaints within the first two, two to four years.

And somebody files a trans, you know, a lawsuit because their transmission gave up after three times, and then the entire car is a lemon. And you'll have the other side arguing about the fact that, well, there's a statute of limitations and I'm a lawyer, a lemon law claim has one statute of limitations.

You don't go ahead and get a lemon law claim and apply different statute of limitations to different warranties. It's one warranty.

I appreciate that answer because that was my concern, is that it's very unclear which warranty prevails as to these new time limits and whether or not it changes the statute of limitations.

Like six years, then they should have just said six years.

Understood. Okay. And then. Thank you, Chair. Okay. And then my second concern is that it appears to shift quite a bit of burden to the consumer. So, the consumer needs to give notice in writing at a certain amount of time to the manufacturer 30 days prior to the action, laying out the vehicle information. Summary of problems.

It really asks the consumer of the vehicle to have a lot of information about that vehicle and really understand how the problem is mechanical and makes it a lemon, as opposed to just the average consumer of a vehicle who says it's making a clunky sound.

So, I'm not sure how you would expect a person to know that information and then convey it in a timely fashion to the entity. So, I'm a little worried about the shift in burden. I'm a little worried about the warranty term.

I'm a little worried about the fuzziness of how this bill interplays with the existing law, because obviously, you're not changing all of lemon law, you're just changing a portion of it. You're trying to speed it up. But I'm not sure that speeding it up benefits Californians.

I have questions about that and maybe they could all be answered if this was July. But it's not. It's the last week of August. So, we have five minutes. And that's if Mister Umberg doesn't, you know, get a hook on me before soon.

I do worry about people shortening the term of the overall warranty, because I think then that would provide them an even shorter window that they would have to provide this additional help.

And then I guess lastly, what I would say is, if this bill passes today, if I vote on this bill today, it would be my expectation that there would be follow-up legislation next year, that there would be cleanup legislation, that there would be additional things that need to happen.

And then lastly, and this is just for me, again, I beg your indulgence, new Senator. I try to make every decision based on one entity, and it is none of you, unless you happen to live in my district, which many of you do. It's all about my constituents. That's it.

I don't care what Ford or Tesla or GM or the judges or the trial lawyers think. I care about what Sacramento Senate District Eight members will have to do when I vote yes on this. And my eyes that went to McGeorge. So, you know, there's Harvard's in the room.

I'm just a McGeorge Knight student who was a mom. But what I recall is this. I think this makes it harder. Yeah, so I'm a little worried about that. And I would be fairly insistent that in the future we take another look at how we don't overburden consumers in California because they got sold a car that's not great,

And they didn't figure it out in time, and that time passed them by. I'm also a little concerned about the entities that are supporting having more claims than the entities that are not supporting having fewer claims. That's a red flag. But again, it's Monday of the last week of session, so I digress.

So let me, for avoidance of doubt, I no longer have a hook, number one. Number two is Senator Ashby, did you want Assembly Member Kalra to respond or what would you like here in terms of the original question?

He certainly can, but he did respond, I think, while you were reading some documents, and so did his folks. But I'm happy to hear anything anybody would like to add.

Miss Shahan, on the point of shifting burdens. It's not shift burdens. There's a notice requirement that would be in existence, but it doesn't shift I mean, this is really, this bill, more than anything else is about process. And you're correct that some of the manufacturers in support do have more of the claims.

They also sell a large quantity of the cars. But the three American manufacturers in support, I think, cover over 60% of the cases that are currently clogging the system.

This, the way this is written, will get either money or a new car into consumers' hands much more quickly than our current system based upon how it's being clogged up. And, Greg, do you want to speak to the notice requirement for the consumer? The burden on the consumer?

Senator Ashby, there is a notice requirement already. The only change, they have to pick up the phone now and make a phone call to the manufacturer. The only change is now they would have to do an email. And it doesn't change warranties. It changes your right only to obtain civil penalties.

You can still always file a lawsuit, and warranties don't change. Your question is, when warranties happen, that warranty is still in effect.

Let me ask you a question. Does current law require a consumer to provide written notice to the manufacturer at least 30 days prior to the action, laying out the vehicle information, including a summary of the problems, a repair history of the vehicle, and that that consumer demand that the manufacturer repurchase or replace the motor vehicle?

Is that a current requirement as stated right now?

That is not.

Okay. Then it's a shift.

Okay. Let. I don't know if you finished. Have you finished your answer?

I can answer.

Okay, go ahead and finish your answer.

But it is a requirement, if you want civil penalties, to put them on notice. Otherwise, you do not get that.

All right. Okay. Other questions. Yes, Senator Stern.

I'll pull that thread a little further. I appreciate the diligence from my colleague, but also, I know we've got both authors here, so I want to sort of try to hone in on that tension and what the openness is amongst the parties around resolving that sort of.

If it's not burden shifting, that it's burdensome, if you will, on the notice piece. I think I see author's point on that the evidentiary burden hasn't shifted, but that this notice requirement would somehow be harder than it is now. The substance of that electronic communication, maybe I'll ask the author or your lead.

Is that more than is currently required, like when you have to make that phone call now? Maybe. Yeah. The summary of the. All the sort of substance in that notice, is that a different set of elements than what is currently required under.

Currently, consumers are supposed to pick up the phone and make a complaint and ask to have the car bought back. There are a lot of high-filing firms that are taking advantage of that system, and that is one of the processes of litigation.

So, the answer to your question is yes, they are supposed to give all that information already, but it's now in an email form and 49 other states actually have a mail-in process. You don't have to do that in California.

Mister Chair, can I ask the Miss Shahan just to follow up on that? Sure. Is that all right? I want to get your perspective just because you were, you were talking about a broader public policy issue underlying this, which is that manufacturers are currently motivated, given the structure of the law.

I just want to ask Miss Shahan, just real quick, if you don't mind. But yeah, just can you give us that? We trust CARS on these consumer issues. It's a very reputable organization and known for integrity and Independence here. Not having a profit motive per se. Right? And those profit motives abound. Right? They're everywhere.

So, no one begrudging anyone's profit motives. It's just responding to the structures that we have built. Are we going to get a situation where if you're making good cars, you're going to, if you're making cars that are lemons at lower rates, you're going to have less incentive to do so in California?

Or is it, can you just flesh that out? And I guess if you want to comment too, on what the, if I can go back to the CARS representative first on the substance, like the burden question.

Okay, thank you very much, Senator. And Senator Ashby as well. You're asking really great questions. So, yes, it would shift the burden. And so, for decades, I've met with the auto manufacturers, and they wanted to get this written notice requirement in.

And the reason for that is that what is driving a lot of this isn't the amount of lemon law litigation per se, which is teeny tiny compared to how many cars they sell. Like during a three-year period, manufacturers sold 7 million new cars in California. There were about 35,000 lemon lawsuits, which is a fraction of 1%.

And the increase, to a great extent, is because some lemon law firms are advertising in multiple languages. So, a lot of consumers who didn't used to get representation are now being represented. Like one of the most active lemon law firms in the state is represent.

About 70% of their clients are Spanish speaking, so now they know they have rights. And to your question about whether manufacturers are more likely to comply with their warranties when consumers don't have to give them a formal notice. Yes, of course.

And we're very concerned about the consumers who never talk to an attorney but just want to get their car fixed. And right now, since 1970, if the manufacturer doesn't promptly give them a refund or replacement with just an informal communication, like through their dealers.

You know, the court found in the Croton decision, which dates back decades, that you don't have to be clairvoyant to know the car is a lemon. You're supposed to proactively without the attorney, the consumer having to do anything major, take care of it.

You know, like Toyota, who seldom gets sued under the lemon law, they'll send it to a troubleshooter. They built a distribution center in Southern California to distribute parts so that they could get them out really fast. What we're looking at is like Ford, which is supporting the bill. Last year they paid $1.6 billion in warranty costs.

They are apologizing all over to the media. Yeah, we know we have huge quality problems. They issued 56 safety recalls affecting 5.7 million vehicles with serious ADP effects like this steering wheel comes off in your hands, and that's very costly for them. They want to reduce those costs, not have to comply with their warranties.

For the vast majority, consumers are not going to figure out it's not enough just to tell the dealer anymore. It's not enough to call the manufacturer's toll-free number and talk to their service reps. You've got to write something.

Thank you for that. And just to wrap up, I guess that point is there, was that an important deal point, that email communication alone? And exactly what was in that email communication, was that central to the deal being reached? Or is there?

To Senator Ashby's point about there could be follow on to make sure that that mechanism, that contact mechanism is as easy as possible.

So, in other words, like that dealership example, was that thought about in a nonstarter or is the dealers is like having a few points of entry, not really as big of a sticking point after all? Yeah.

If I might, Mike Belote, on behalf of GM. Yes, it was a substantial part of the discussion. 49 states require some form of written notice, and it goes to willfulness. Did you intentionally fail to honor your warranty obligation, or you didn't, which is what leads to the civil penalties.

For the first time, there is no deadline at all on manufacturers now to respond. This is the first time in California law that a strict 30-day deadline will kick in. You have to tell the consumer, yes, we believe you have a lemon. And we're going to give you a replacement car or a full buyback.

And we're going to do that within another 30 days. So, within 60 days, we're going to figure out whether you have a lemon and take care of it. And that's the first time there has been a deadline in California law.

But we think it is fair and in accord with 49 other states to, instead of having to sift through the millions of calls that come into a call center, a simple email, I think I have a lemon. I need a buyback. I took it to the dealer three times.

Senator Wahab.

Thank you. So, I want to thank the author for bringing this forward. And obviously, this is an issue. You know, in this building, we constantly talk about going green, and I always argue the fact that this is America, we are all driving somewhere.

In my district, you know, we have a lot of people that commute outside of the district, into my district for jobs. You know, I, for example, where I used to live before this job, I would drive 3 hours a day, an hour and a half each way to and from my job.

A car is incredibly vital to all people, let alone the working class and those that are living even further and further away. We have one of the greatest American car manufacturers in the world suggesting that this is something that we push.

Average warranties that we are talking about is three years or, you know, 36,000 miles, something like that. Maybe a little bit more, maybe so forth. This has not been touched in decades.

The reality is that right now, if, and I'm going to speak from personal experience, so my very first car that I purchased, I had a beater for a very long time. And I eventually purchased a car. This was like maybe in college. And this vehicle was brand new, and it kept having little issues, right?

And I had no idea what the issues were. Took it to the dealership multiple times. Eventually it hit over the warranty mile because of the issues not being addressed the very first time.

And as a person who, you know, it's been talked about, the consumer, the right to representation, having to pay for that representation, having to find that representation, having to explain the problem and much more, and even calling the manufacturer and saying, hey, there's a 1 800 number. And going through that. It's a process already.

And to be quite frank, it's a bullshit process. Right? It does not serve the consumer. It's not answered. It's the phone calls are ignored, rejected, and the entire system is developed to not have to do what's in the best interest of the consumer. That is what we're actually having today, to be completely frank, an email. I would prefer.

I would prefer sending an email saying I bought a car at this time. I've took it to, whether it's some manufacturer or some auto body shop or something like that to fix this. It has not been fixed. In fact, I got an estimate from an outside party that has taken photos. Here are the attachments.

Let me forward you this email. It is friendlier to the consumer in this suggested manner. That's the honest truth. Yes. Are there cleanups? I'm sure, you know, a big change of a bill or a law that hasn't been touched in decades. Of course, there's nothing. It is last minute. Right?

And I know you guys have worked on it for months, but for us, we haven't necessarily seen it or had all our questions answered. But to me, being able to send an email at 11:00 at night and not being able to answer, have somebody on the phone, this serves my purpose. I can send photos.

I can say this, and I can say that the vehicle mileage is at this point initiating 100% that I need help before it hits its warranty or write when it was in warranty and show documentation and much more. I think that this is incredibly fair.

I think, yes, we still have work to do, and we need to prioritize consumers. To me, to be honest with you, and I'm surprised that, you know, all our environmental friends haven't been talking about this, is that warranties should be at minimum 10 years solid. That is a huge investment.

Even the cheaper cars that are $20,000 should last a person 20 years, 10 years, whatever the case is. But not these three years, 36 months, X, Y, and Z. We have not been friendly to consumer. We're basically buy and sell the car. To get a reaction from the manufacturer within 30 to 60 days, the way it's outlined is very fair and it allows a person to get back on the road to do their job and care about the things that are important to them. So, I will move this bill. Thank you.

Alrighty. Thank you, Senator Wahab. Other questions? Senator Roth and Senator Allen then. Oh, I'm sorry. Senator Durazo actually raised her hand first. So, Senator Durazo.

Thank you. Thank you very much. And I appreciate my colleagues' comments right now about what appears to be strong protections for the consumer. Sounds very fair. But the author who, authors, but this author I have a lot of respect for.

I know that you and your life and your commitment hold the consumer very high so that means a lot to me, but I'm a little bit thrown off by who's for and who's against, and I can't make sense of it.

So, as you were going through this and you reached an agreement about legislation that you would propose, what are these differences, for example, within the car manufacturers? You know, there's GM, there's other companies. What's going on here? What's the, what's motivating them to either before or against?

Well, there's, you know, I can't speak to others' motivations. I will tell you what my motivations are in learning about this negotiation, which was many, many months long. First of all, right now I've gone through a process, a lemon law recall process. I had to notify that I wanted to be part of it.

I was informed by a colleague in the Assembly and a few of us took part in it. The fact that there's no burden of notice right now in the consumers is frankly not true. There are steps they have to take.

To Senator Wahab's point, I don't know if there's any situation these days where we don't document things in writing, usually through email. We don't go on the phone and say, hey, I had an issue to come up with a repair shop. We put it in writing because we know that protects us.

So, this is asking us to do that. And let's keep in mind right now, there is no deadline for the manufacturer to respond to consumers once notice is made. Right now, there's no deadline. So, if you call and go through the process of calling, they can take weeks or months.

And what they are doing is they're actually delaying. And that's why our court system is clogged. 10% of civil cases in Los Angeles are lemon law cases. That is not good for consumers. So, are there some things the manufacturer likes? Yes. That's part of negotiations. That's how you get. That's what, we did that with PAGA.

I would have, I was fine. I probably wouldn't have done all the things that we did with PAGA the way exactly it was done. But guess what? It's not Ash Kalra that's negotiating with himself, right? In the similar situation.

This is a situation here that I believe will lead to results where consumers will actually get their end result done much more quickly. It doesn't affect warranties at all. Warranties are still going to. Warranty law still remains completely in effect. What this does, it actually speeds up the process of having manufacturers.

It requires them to respond within 30 days. Right now, there's zero deadline for them to respond.

And subsequent to that, there's another process where essentially within 60 to 90 days, unless there is some dispute, a greater dispute that is determined, the consumer is going to get their money back or get a vehicle, and that's not happening right now. And guess what? Another thing.

The manufacturers tend to have a lot more lawyers that can draw these things out than the average consumer does. And so that's where ultimately, ultimately, and, you know, are there going to be potential amendments going into the future that Senator Umberg and I are going to put? Certainly, like any, any piece of legislation. Especially.

I'm glad you brought that up because that was a question, is this is being done as an urgency and, you know, is there an understanding that this could, could come up to clean up or address issues that we would have known? I've been on the side of where I've been told, no, that's, that.

Don't even think about bringing that back. And there was a quote-unquote deal, that sort of stuff. So, I want to make sure you know this in exchange for the urgency that we really are going to be open-minded about any.

Senator, you're absolutely correct. This is not something. This is something. And I think you know myself and Chair Umberg well enough to know that we are more than happy to come back if things need technical cleanups, if there are things that need to be fixed.

This morning, we took an amendment based upon meetings we had last week from some of the defense attorneys to help ensure that games can't be played by litigants and particularly by the manufacturers. And the manufacturers accepted that amendment.

And so, there's no doubt that there are things that we can, we're going to continue to work on like any piece of legislation. It wasn't up to me that this, that this negotiation took many months. It happened in the way that it happened.

And I'm hoping that by coming to some agreement, this won't become a prolonged battle that will have to continue to return to this larger battle, but rather just work on the cleanup in the.

Months and years ahead just to clarify something. And you're right, this is a matter that's being brought to us at the very end, but there is no urgency provision in the bill.

Yes, there's no urgency. Yes, that's correct.

Correct, correct. All right. Senator Roth and Senator Allen and Senator Laird.

Thank you, Mister Chair. You know, perhaps we should have put a sunset on this for some length to figure out how it was going to work and then give us an opportunity to revisit. But hindsight is 2020 and we don't do that at this point in the process. I was a little confused on the conversation about warranties.

I looked at the analysis. There's an express warranty, maybe there's an implied, but I don't know. I didn't know and I used to be a lawyer. I don't know what you were talking about when you were exchanging conversation with my colleague about multiple warranties.

The analysis talks about this bill requiring actions to be commenced within one year after the expiration of the applicable express warranty, but no later than six years after delayed of original delivery, etcetera. I don't see anything about some other warranty. You talking about a service contract? I'm talking to you, sir? Me?

You were the one who were having the conversation talking about the service contract.

No, your honor, I'm not.

I'm not the honor, he's the honor.

I'm not. I apologize. So, what's going. So, a car has several warranties, a bumper-to-bumper, a 12-year battery warranty, and a powertrain warranty, for example.

Those are express warranties aren't they?

Right. Those are different express warranties.

So, they're express warranties.

So are we talking about.

Right.

Right. So, let's say if you have like for example, a car that has three battery complaints during the first year, that's covered under the 12-year one-month warranty, and then let's say you have a couple of air conditioning complaints that happen during the second-year warranty that's covered under the bumper-to-bumper.

And then let's say during the fourth year and fifth year, you have complaints about the powertrain warranty. So, you have all of these complaints regarding the battery and the entire car is a lemon. Right? So, you should be able to introduce all of that evidence and they're not.

And it shouldn't be well, you know what, all of those battery issues that you had within the first year, the three battery replacements, and the fact that this battery replacement also came back four or five years ago. Four or five years.

I mean, you know, came after the first year, none of that should come in because you didn't file your losses within one year of that warranty.

The applicable express warranty. So, if you have multiple express warranties.

Yeah, if applicable, express warranty means the most recent warranty in which that you reported the nonconformity with, then the customer complained about the nonconformity. That would be a clarification that should be made.

Did you supply corrective or amending language to either the people, the proponents of the bill, or the Committee?

Well, I think, I believe my, I believe we did submit some language on that issue to the Committee earlier today.

Well, you were a little bit late for that.

Well, because we weren't consulted about the bill.

:et me then ask, let me then ask another question. So, what happens if the consumer misses the 30-day window?

Under current law?

Little time to think about your answer because we need to recess for five minutes so that the floor session has started or will start in one minute. And they need to switch the TV camera over to the floor versus all of us good-looking people here.

So, we're going to be in recess now till 2:05. We don't have to go to the floor, but they need to switch over the electronics, I am told. So, we're in recess.

Senator Roth, when we parted company here, Senator Roth had asked a question, and the respondent is not here. So we'll move on to... Senator Roth, did you have other questions?

I can just. Let me just.

I mean, my understanding of reading this, if I read it properly in the time that I had to read it, is the consequence of not completing the 30 day notice results in perhaps the inability to secure the civil penalties, which are up to two times the amount of actual damages, but does not impact the consumer's right to obtain either restitution, which is the money paid for the crazy automobile.

That's lemonade, or a replacement vehicle, is that correct? As attorney's fees as well. You can still recover those. Okay, so let me just say this.

You know, as a former customer of the court system, as a former manager of a firm that admittedly, I confess where I was, but some of my partners defended Lemon law cases for one of the major manufacturers and also rvs that I watched from afar. It seemed like a sort of a cottage industry to me.

But one thing that did occur to me as I watched it was the never ending stream of discovery that resulted in these cases. And I watched it because I was managing the firm and to some extent, it wasn't a profit leader. And so I was interested in what lawyers were doing and paralegals were doing.

From my perspective, we need to streamline this thing. And if there's a problem somebody's complaining about front loading discovery, we ought to front load the important pieces of discovery. We ought to find out what the problems are in the case from both sides. Both sides ought to sit down.

If there's mediation required, they ought to mediate, and they ought to get the damn thing done. And if you can't settle it, then you can continue on with your discovery. But it is that sort of legal activity that is clogging our court system.

And I was practicing in Riverside County at a time when it took over five years to get a civil case to trial. They had to start the case, postpone the case, to toll the statute of limitations on proceeding, bring another case in and start another case.

In those days, I don't know if Mister Vizio remembers that, but I certainly do. We cannot go back to that. We need to streamline litigation where possible. And so I'm going to be supporting the Bill today.

I would, if we could amend to have a, perhaps a sunset so we could take another look at this and fine tune the provisions if, in fact, we've got it wrong. But we can still do that. I won't be here. Someone else will be here next year and the year after.

And if someone Member Kalra has caused a problem, we can fix the problem.

Thank you, Mister chair. Thank you Senator Roth. Senator Allen, Senator Lehrer, then Senator Niello.

Gosh, let me start with opposition. I mean, are there things, can you tell me what do you like about the Bill on the opposition side? Yeah, sure.

I've spoken with some of the Committee Members previously. You know, I do like the streamlined discovery procedures and I appreciate the Committee making the change and amending the Bill and now saying it's based on responsive pleading and the answer. And I appreciate some of the sanctions that were put, however, even on the discovery issues.

And I think this may have been because GM was in the room and not all the plaintiffs attorneys were in the room.

Is that for example, like we have communications that has to be produced between the customer and the manufacturer and customer and the dealer, but it's very vague and ambiguous as to whether or not documents and communications regarding the subject vehicle between the manufacturer and the dealer has to be produced. And that's really the lemon law case. Right?

Like the manufacturers and the dealers talk about the vehicle and the problems we had. So like there's some clarity that could have been, you know, introduced and it would be better. Also, I think there's also provisions regarding the discovery portion of this that says relevant documents needs to be produced.

I think there should be, you know, the clarification, by relevance we mean the allegations in the complaint and the affirmative defenses raised in the answer, not what the manufacturer thinks is relevant, and just produces it based on their own theory of the case.

Then what happens is you have a bunch of litigation and say, well, you know, the statute says what's relevant, this is what we think it's relevant. So those are some stuff.

And I'm sure, you know, Coc, who I'm a Member of, I'm a little bit disappointed that they didn't consult me with this or the other people who are going through this every day. But I think these are issues that the Bill could have been improved on even with the discovery streamlined, which I support.

But you know, but you know, but at the same time, that can also, you know, get codes courts congested as well.

Senator, can I add. There's such a different perspective. This is probably problems like the automobile. Industry doesn't answer your question. Well, I had one more. He answered his version of the question. Yes, it did. Zero, what was?

I'm sorry?

No, no. I mean it was responsive. Mister Allen, would you like, Alissa, respond your question. Yes, please. Can I just add one more thing to that?

Sure. Well, the other thing is, too, I don't believe a customer should be, I mean, under the current Bill is also vacant and because where the customer now needs to go and collect all the repair records from several years ago and produce it as part of the 120 days.

And, you know, I saw Senator Wahab, who brought up a good example. You went to the dealer, you found out your car had a problem, you got that repair record, and you sent it to them. That's great.

But you shouldn't have had to go and find four or five years worth of repair records and give it to them. And if you don't give it to them, then now they're going to file all of this document saying, zero, your case should be dismissed.

You didn't give us the documents that they already have in their possession, custody and control. So it would have been great. It's saying, look, the manufacturers should make the first initial production and whatever they don't produce and they haven't produced, then the consumer can go ahead and supplement that.

All right, thank you. Senator Allen, would you like your question answered by others? Yes, please. All right, thank you.

I just have two quick questions. Go ahead. In terms of, on behalf of the manufacturers, there's 14 manufacturers in opposition of this Bill. Two of the things that we like are the pre suit notice. That is a great addition to the Bill because it provides the pre suit notice. It provides a lot of clarity.

Right now, consumers do need to contact us, but they often do so by phone call. And they say things like, I'm unhappy with my repair history. I can't, I don't know what's going on with my car.

And then judges interpret that as pre suit notice that we should have affirmatively bought back a car when they could have just been calling up to ask a question. It's a shame it didn't get expanded to all song Beverly claims. Currently under the Bill, it only deals with ones that would eventually see civil penalties.

The second thing is that is a positive is part of the streamlined discovery process in that documents are defined and that topics are defined for a PMQ person. Most knowledgeable deposition. Right now we can get notice of 90 separate topics for a PMK deposition. And it's a lot more narrow in this document. That is definitely a positive.

But there is still some ambiguity here. So there will still be motions to compel and clarifying that, as Payam just mentioned, because they will not accept what we provide as a manufacturer as being reasonably responsive.

So even though there is a stay for other discovery, it won't cut off all the things we're trying to solve, which is clogging up the court system. We will still have motions to compel. Thank you very much.

Did that answer your question? Senator Allen, go ahead. Yeah. I mean, sure. Okay.

I understand everyone's in a big rush. I mean, we got this analysis at 10:00 a.m. this morning. I had no idea. This whole negotiation.

I'm not rushing. I just want to know if there's others you want to respond to your question?

Yeah. Well, Mister Laird seems to want to move on. I get it. All right. I'd love to hear from the person who's representing the California Judges Association right here. Okay. You're with? Okay.

I wanted to just get the judge's perspective on, you know, this whole couple things that have been brought up, one of them having to do with plaintiffs. Let's talk about, first of all, a civil procedure. There's been an argument made that this is really creates, it's setting new set of standards with regards to civil procedure.

Obviously, it's narrowly tailored to this particular type of incident, but they're worried about slippery slope issues. Was that something that was discussed around the judges table?

Thank you, Senator. Mike Belote, speaking on behalf of the California Judges Association, who looked at this very intensively, they believe that this, that we are. Our suggestion is correct. This will weed a lot of cases out before a lawsuit has ever been filed. This will give a relief within two months. Substantial numbers.

They also believe that the breadth of discovery, that to the extent you can standardize this, and we've done it before in other contexts, and we've done it early, as recently as last year in SB 235, will help judges say to the parties, no, you don't get worldwide records.

You get records relating to communications between the manufacturer and the dealer and the consumer. And it's on page. It's right there. It's page 11, lines one through four. It's quite clear. It's written and oral communications. Everything, you know, manufacturer, about communications, tell them.

And the more we can have, and so the judges believe, the more you could standardize this, the more they can get through these cases and everyone wins. So, yes, they looked a lot at it. I thought you were GM. I represent GM and we represent the California Judges Association. Both have for 40 years.

Okay. Okay. I got. No, no. I mean, as lawyers, we're always so confused by all the conflicts. But I know that's how it works here. Okay, let me ask about just the issues of some of these issues associated with, with the rights of a consumer.

All the extra paperwork they have to turn in, some of the issues that were just raised by the attorney here about having to provide all this additional documentation. Were those things discussed at the judge's table as well?

I understand the core concern is about congestion in the courtroom, but surely these access to justice questions, and these are important to them.

I know that they said, honestly, Senator, they said this is sort of how federal civil procedure works. If there are minor defects in how the plaintiff presents the case, and often by him or herself, we get over that. We take it as a complaint.

They say, tell them basically what you try to do to take care of your car. And that's, again, just for the civil penalties issue. And if you tell them that and they respond, then the 60 days kicks in. If not, they can bring the full complaint for civil penalties and the whole range of remedies.

So, yes, they thought a simple explanation for what the consumer went through with the manufacturer was fair pre litigation.

Right. Okay. Was there talk at some point about. I'd love to just, I know at 1.0 there was discussion about some sort of opt out mechanism where if the consumer and the OEM mutually agreed, they could choose a different path. I'd like to ask about that.

And I also like to ask if there's any discussion of some sort of sunset, given all the complexity here, so that we can at least get an understanding of how this has played out over a couple of years and then make a determination later as a body as to whether we want to continue the mechanism.

So I saw you move your mic.

To, well, we weren't involved in any of the negotiations. It was just Mister Balot and his three clients who spoke in favor of this today. But there is a provision in here that would provide, via stipulation of both parties to not use the streamlined agreement, the streamlined litigation procedures that is in this Bill.

So there's an option by both parties. If they mutually stipulate to not go through the streamlined procedures.

Yes, Senator, was a very contentious issue. And we did negotiate that all the. Way through, and it did. Both sides can stipulate out if they so choose.

All right, so you could end up saying to, if you happen to have a volkswagen problem, you could both agree to go a different path, I guess.

No, I mean, look, then we'll be able the same situation where we need. To talk into the minor. No, I mean, I think that the issue is going to be. We're talking about the consumers giving their substantive rights. And you asked me what I liked about the Bill and I said I like the discovery procedures. Right.

But I don't want to get into, if we're going to put something in the discovery procedures. I mean, we got a specific, I mean, I already know I'm going to be arguing with GM. He didn't not once mention that communication includes communications between the dealer and manufacturer regarding the subject vehicle.

These are communications about our client's vehicle that they have in their databases, that they record, they have about our clients. And they didn't even put that in the Bill. And he just wants to give me that.

The communications they have with the customer and the dealership, these are the kind of problems that I want to avoid in the discovery process, and these are the things that I like about them.

Thank you. The answer to your question is, I think, Senator Allen, if I could interject, is that, yes, if both parties agree to use the old process, they can basically do whatever they want to do. If they want to say, you know, we'd like to take 50 depositions on each side, they can stipulate to that.

And I assume the judge is going to go ahead and basically ratify their stipulation.

And what about the sunset consideration? Was that on the table?

That's. I wasn't part of the negotiation.

So today's the first time that's come up.

Right. Okay.

I wasn't part of the negotiation either. So I don't know if that was, but I haven't heard it from either party that that was part. All right.

Conversation. So. Okay. To be clear, I know we're on the floor, but I'm not, I don't want to rush any of the Senators. This is an important issue. Senators should ask any question they wish, make any comment they wish, and then ask whomever they wish to respond to that question.

That's perfectly fine, just as we do in other hearings. So. All right, next is Senator Laird.

I have a brief comment and a question for the author because I've been struggling, as everybody on this Committee has, with the fact that this is coming on Monday of the last week. And normally we would have a chance to work on this.

And I think it is a good bill in the framework and it gets to a better place.

And I have sort of concluded during this debate that if we were to adopt this Bill and then have still next year negotiations some of the issues that are still at issue, it actually sets the framework for those negotiations in the right way. Because it sort of sets this up as the starting gate to do it.

Because if we were to just kick this Bill over to next year, in many ways it would be starting all over. And in many ways, some of the concessions that each side made would not be made again or would not be enshrined into law. So I'm inclined to vote to move to the Bill.

But that leads to the question, which is of the author, are you willing to work with all the parties in the next year to address what are perceived to be any remaining issues?

Yes, absolutely. And, Senator, you know, this is my 8th year here. I don't think I. You've seen me do something of this nature before. And the reason why is what you.

Mean involved in a really controversial. Well, no, no, no. That I do all the time. I do all the time. In terms of coming the last, I've. Been to all those hearings, in terms.

Of coming the last week or two, this was, you know, it was predicated by the. How the negotiations went and when they ultimately completed. But absolutely, I think myself and chair Umberg are two folks that have no problem continuing to examine the work that we do. I know all the parties have indicated the same.

In fact, the amendment we took this morning was an amendment that our gentleman that's been expressing some concerns brought to us last week, and we inserted that today.

And so any suggestion that we're not willing to be flexible and listening to all sides and parties, even those that continue to object to the legislation with those amendments, that's fine. That's their prerogative. It doesn't mean we're not going to try to make it better. The suggestion was a good one. We took it up today.

The manufacturers agreed with it. And so we believe that's going to be.

I know you're an attorney. I am. The answer was yes.

But you have to remember I was. You have to remember I was a public defender. We have to sometimes, you know, find we have to have dramatics. Thank you. Thank you.

All right. Thank you. Senator Laird, Senator Niello, then Senator Caballero.

Thank you, Mister Chair. I'm with my fellow freshmen and longtime friend, Senator Ashby. I feel jammed and I kind of don't like that. Now, as a car dealer, I am not involved in lemon law cases, but I am an observer, although nothing to the process. So I don't see all that laborious stuff going on in the background.

But again, I'm not directly involved. So it's not an issue that I have to abstain and I'm not going to abstain. I am, however, not going to vote. And the reason is that, number one, being jammed. I briefly spoke with Mister Bellot earlier to let him know where I was.

I am feeling kind of jammed, and I don't feel now. I'm not an attorney, although I play one every Judiciary Committee, but I'm having a hard time assessing this as a permanent, effective reform that's not going to have unintended consequences. And Senator Laird's point could be one well taken.

But we're just taking the word of the author that he's going to work diligently to bring in the feelings and ideas of those that are opposed, and maybe, maybe not because they weren't involved in the first place.

And the really interesting thing about this, which is I find kind of unique, is that we have consumer interests that are in favor and we have consumer interests that are opposed. We have manufacturers that are in favor, and we have manufacturers that are opposed. We don't often see common entities and people on both sides of an issue.

However, I did notice, I think, Senator Allen, for his question, that there is enough agreement as to certain positive aspects of this Bill that the opposition could agree to, and perhaps a negotiation involving all relevant parties can work toward a better solution. And the lemon law as it exists, has been in place for over 50 years.

I think there's a reasonable contention that perhaps it is time to take another look at it. But I'm not comfortable passing this Bill with just the understanding that the opposition that wasn't involved before is all of a sudden going to be involved.

And perhaps the Bill amended so I'm not going to vote no, but I can't support the Bill. So I will be abstaining again, not because I'm conflicted, but because I truly am not going to vote on this piece of legislation for the reasons I stated. Thank you, Senator. Senator Caballero.

Thank you, Mister chair. And I appreciate the opportunity for all of us to be able to ask questions and to speak. Could I ask the opposition how? When was it that you saw the document that we're looking at today?

Thank you, Senator. The Bill language came out last Tuesday evening, and some of us were aware of the framework agreement about a week before that, but GM accepted, at least from our opposition coalition, zero amendments.

Thank you.

Yeah. And we found out when it was in print. We didn't see any language before then.

All right. Thank you very much. Well, let me just say that this is one of the harder bills I think, that we've seen, mostly because we all pretty much saw it late. But it is definitely an area where there is great consternation and real concern. We have a legal system that is, doesn't really function efficiently right now.

With all due respect to the judges, for a whole bunch of reasons and anything that clogs up the court system is really a means that their access to justice just isn't there. I want to agree with my colleague that it's a good framework.

It would have been better to have it done earlier so that we could all take a look at it and make, make some suggestions in terms of change.

There's no question in my mind it needs more work and it needs a sunset so that we can come back and take a look at whether it's working and whether there's, I mean, that sunset starts putting a timeline.

The question became, assemblymember, are you committed to, you know, working some more on this and working out what needs to be worked out? And you said, yes, I believe you. But a sunset really creates the opportunity to get it done and to do it early enough. So I'm going to support it today.

But I do think that we need to. So, and let me say why I take a look at this, and I think the earlier it is that there is, notice that there's a framework from which to advise the manufacturers that there's a problem and that it has to be fixed is a good thing.

And what I see out of the language is it starts a clock, but it's a clock that benefits the consumer as well as a clock that advises the manufacturer and the dealer as well. The dealers don't want to be stuck in the middle of these situations. That's the bottom line.

And many times they do because the lemon car keeps getting taken into the dealership. And over and over and over again, they're trying to figure out what's going on, when it probably should be handled by the manufacturer. So I think this is not an easy area of the law to deal with.

And I thank you for taking this on during this last time, but I'm going to support the Bill today.

Alrighty. Thank you. See? No other questions or comments. Just a few things. First of all, thank you, Senator, Assembly Member Cara, for bringing this forward. And I commit with you to continue to work on this very important and complex issue.

I want to note Senator Roth mentioning that this, the song Beverly act is 50 years old, which makes me feel a little old because I served with Bob Beverley, who, by the way, was a Republican Senator here in the Legislature, as well as Sally Tanner way back in the day.

A couple things here is that the language in the Bill, although I didn't negotiate it, is familiar because a lot of it comes from what we had done to take federal rule 26, which requires early disclosure of information, witnesses, documents and the like, to expedite litigation. And it is in, incorporated into this Bill.

The term relevant is now being defined, as we speak by the various courts, because that is existing law as of January 12024. And certainly documents, in my mind, and if it's not clear, we'll make it clear that documents that are delivered between the dealer and the manufacturer are clearly relevant documents.

The affirmative obligation still exists on the part of the manufacturer. There is no shift so far as I read the Bill. And to make it clear, and I'll ask Assemblymember Kara, I think he agrees with, there's no shift in terms of the burden.

The manufacturer still has the burden of making sure that the remedies are provided to the consumer. The challenge that we have, I recognize the challenge that we all have, because this is thrust upon us the last week, literally the busiest week of a two year session. But it is here.

And the question now is whether we create this framework to move forward, subject as it is to modification in the years hence. So with that.

Yes, I just want to say I'm going to lay off of the Bill today, and I just need you to understand why, had there been a sunset, I probably could have gotten there, but I just, and I know there's still time on the clock, and the reason I'm taking the moment to chime in while we all really want to get to the floor is that there's still time on the clock for you to make that change.

And perhaps I could reconsider on the floor. And I think it would be meaningful to many other people who are not in this room and won't have the benefit of this conversation.

Can we ask if he's willing to accept a sensei?

Yeah. If it's the will of this Committee to ask for a sunset, I'm perfectly fine with it. I believe the parties are okay, but we want them to speak for themselves. But I think five year sunset was something that was suggested. But I also want to ask my joint author as well.

So I, you know, I'm kind of like, I'm okay with. But it's not just me. I think it's for a couple of us.

Let me interrupt for just a second here. Here's the challenge with a sunset. And if it's the will of the author, that I'm willing to accede to the will of the author, as a joint author, to incorporate a sunset.

But when you have a sunset in a Bill concerning civil procedure, then it invites the parties who don't like that procedure to basically delay as long as they possibly can so they can avail themselves of the former procedure.

So to the extent there's going to be a sunset, I would suggest it Beverenne long enough that we don't invite gamesmanship here in the filing of claims. Senator Durazo.

My concern with the. Sunset is we just had a conversation back and forth about fixing this, and maybe as early as next year, fixing and working together. Let's see what makes sense, what doesn't make sense because of the time crunch that we're in.

My concern is you put a sunset, then you're basically saying, let's hold off. I've seen this happen before. Let's hold off. Let's not do anything to fix it, because there's a sunset here on which. All of us should work off of.

And respect the sunset and not really do much until the sunset gives, you know, that time has passed. So I'm very concerned primarily because we. Have as much of a commitment here as you could possibly get to fix it, whatever that may mean.

All right. So. Yes, Senator Wahab.

So sorry to add to this wonderful conversation. What about instead of a sunset, a one year delay of implementation to ensure that everything is up to par by next year?

I would probably have, I would find that probably more problematic than a sunset, only because I think that we know that the system is currently broken and that once it's implemented, I think we'll have an opportunity to see, but see if some of the horror stories that are being come to fruition or not.

I make two observations in terms of at least my observation of how civil litigants proceed. If there's a sunset, let's say there's a one year sunset, you will see lots of litigation practice by those who wish not to be bound by the law to, to delay things.

If there's a delay in implementation, you will see an acceleration by those who wish to use, avail themselves of the current law. So I think it either has impacts on the courts and what happens with the courts and what happens with the behavior of the various representatives. Yes.

Senator Roth, let me just make an observation. I mean, there's been a lot of conversation here.

While I will not be here next year, there are a lot of people on the dais who will, who are obviously concerned about certain portions of this Bill, who were concerned about the fact that we've got a bunch of manufacturers on one side and some on the other.

Frankly, I'm not sure I understand what that the nature of that opposition really is. We have heard what the concurrence is.

If you don't start to work on this thing, then I suspect one of these folks who will be here next year after January, in a new session, we'll offer a Bill to fix what we've just been talking about here.

And so, I'm not sure we need to worry about one year delays or sunsets at this point, because I think what will operationally happen is there will be a Bill. So. Well, I will offer my opinion on whether you can do an amendment from the dais the last four days of session, but I won't. All right.

All right. I'm sorry. That's right. Senator Havas made a motion. All right. Motion's been made. I'm sorry. The motion was to move the Bill as written?

Yeah, the motion is as written. I think, given the difference of opinion, including from the chair, in terms of the impact of a sentencing that proceed as written as the motion states.

All right, we'd like to close.

I appreciate. Look, this is not how I would want to do it, either come in the last couple of weeks, but I'm not going anywhere. Hopefully, for a little while. Some of you are going to be here. Hopefully a lot longer than that.

And I think, as indicated by Senator Roth, there's a lot of interest for a reason. And I don't think any of us are going to allow something to continue. If it's bad for consumers. I think this will be good for consumers. And I think time will be able to tell that.

And as indicated by amendments we've already taken in a relatively short period of time, from opposition. I hope that indicates that. Yes. I'm more than willing to take more feedback and convenient meetings with all the stakeholders. And with that respect, we ask for an aye vote.

Alrighty. Thank you very much. Madam Secretary, please call the roll.

This is AB 1755. The motion is do pass. [Roll Call] Nine to one.

9-1. Bill passes. Thank you all. Okay. That was funny.

We are adjourned. Thank you very much.