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U.S. Supreme Court Denies Legal Fees In Settled ADA Cases

July 2, 2001

Washington, DC--In a significant victory for restaurants and other small businesses, the U.S. Supreme Court ruled that the Americans With Disabilities Act (ADA) does not permit a court to award legal fees for plaintiffs’ attorneys in situations where an alleged violation of the ADA was resolved before a trial verdict or a court ordered consent decree.

The case (Buckhannon Board & Care Home Inc. v. West Virginia Department of Health and Human Services) offers hope to restaurateurs facing frivolous and costly lawsuits by attorneys seeking to exploit and cash in on the ADA. The 5-4 ruling came as Congress considers legislation that would allow restaurateurs and other business owners to correct alleged violations of the ADA without the expense of going to court. The ADA Notification Act (S. 782/H.R. 914) by Sen. Daniel Inouye (D-Hawaii) and Rep. Mark Foley (R-Fla.) is strongly supported by the National Restaurant Association. Under the bill, a small business would be informed of an alleged ADA violation and then have 90 days to correct it before a lawsuit could be filed.

“While the Association strongly supports the accommodation of individuals with disabilities both as customers and employees, we are very concerned about people taking advantage of the ADA and filing flagrant lawsuits against restaurateurs,” says Association Senior Vice President and General Counsel Peter Kilgore. “Just one frivolous lawsuit is enough to put a small business out of business.”

“The Supreme Court decision is a positive sign for our industry. Compliance—not legal fees—should be the focus,” he adds. “While this decision is not going to preclude litigation from continuing, it does take away one of the incentives from a monetary standpoint.”

Source: National Restaurant Association

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