Senate Revenue and Taxation Committee Rejects Shakedown Lawsuit Bill

Media Contact:
Nick Mirman
nick@cmpublicaffairs.com

SACRAMENTO, Calif. (April 23, 2025) — Today, Kyla Christoffersen Powell, President and CEO of the Civil Justice Association of California (CJAC), and Robert Gutierrez, President and CEO of the California Taxpayers Association (CalTax), released the following statement after SB 799 (Allen) failed to pass in the Senate Revenue and Taxation Committee:

“California small businesses are struggling. The last thing they need is a state-sanctioned army of plaintiffs’ attorneys barreling down on them over issues with their tax filings.

“SB 799 would have unleashed shakedown lawsuits against business owners and outsourced the state’s responsibility for tax enforcement to the plaintiffs’ bar. Members of the Senate Revenue and Taxation Committee wisely rejected this bill, saving small businesses from cost increases and new litigation threats.”

CJAC and CalTax led a large coalition against SB 799, which would have revised the state’s False Claims Act law to empower private individuals and attorneys to sue businesses over tax issues – even matters already cleared by the state’s tax enforcement agencies.

Under the provisions of SB 799, private plaintiffs and their attorneys would have been able to collect up to 50% of the recovery. The bill also allowed for treble damages, which could have turned a $200,000 tax dispute into a seven-figure court award.