Rutan & Tucker Opens 17200 Practice
By CHRIS CZIBORR
Costa Mesa-based law firm Rutan & Tucker LLP has formed a practice to defend companies facing lawsuits based on the state’s Business and Professions 17200 code, which has gained notoriety in California in the past year.
The firm’s Advertising and Competitive Business Practices group starts with six attorneys and is expected to grow to a core group of about 10 within a year, according to Rutan & Tucker partner Layne Melzer, who chairs the group.
“We’ve seen an increasing flurry of 17200 litigation affecting our clients,” Melzer said. The firm felt it was missing an opportunity by not forming a 17200 practice.
“We (already) had a critical mass of people dealing with 17200 issues,” he said.
California’s 17200 code allows anyone to sue on behalf of the public. The business code has been on the books for about 70 years, but related litigation mushroomed in the past year. Suits mainly have targeted small businesses, such as nail salons and auto repair shops.
Critics contend the 17200 suits amount to little more than legalized extortion. California lawmakers have considered several bills aimed at reforming the code.
Beverly Hills-based Trevor Law Group LLP emerged as the most notorious of 17200 litigators. The firm targeted thousands of small businesses in Orange County and elsewhere in the Southland using 17200.
Trevor Law would notify small businesses that it planned to pursue a suit unless a payment,often in the thousands of dollars,was made to the firm.
The firm’s three partners,Damien Trevor, Allan Hendrickson and Shane Han,last month had their licenses suspended by a state bar judge and face a disciplinary hearing by the end of July that could result in complete disbarment for all three.
Rutan & Tucker attorney Ed Sybesma will be part of the firm’s new practice. Sybesma represents Nashville-based Bridgestone/-Firestone Americas Holding Inc., part of Japan’s Bridgestone Corp., and the owner of a La Habra repair shop that was sued by Trevor Law under 17200.
Rutan & Tucker has more than 50 attorneys who handle litigation. Melzer said many of them were fighting a growing number of 17200 cases.
“Some of these cases had gotten to an almost absurd level, and we realized we needed to handle them in a more formalized fashion,” Melzer said.
The practice includes Rutan & Tucker partner Mike Hornak and attorneys Karen Walters, Lisa Neal and Andrew Ainsworth.
“We’ll eventually have 20 attorneys or so that will be part of the new group,” Melzer said.
Other law firms with 17200 practices include Los Angeles-based Gibson, Dunn & Crutcher LLP. It has had a 17200 practice since the 1980s, and includes attorneys based in the firm’s Irvine office.
Rutan & Tucker, with roots going back to 1906, is the oldest and largest full-service law firm headquartered in OC. The firm currently counts more than 120 attorneys.
