April 25, 2023

Litigation Victory Signals End to California Courts’ Illegal Late Fees That Penalized Poverty for Profit

FOR IMMEDIATE RELEASE
April 25, 2023
MEDIA CONTACT: Raya Steier, 530-723-2426, rsteier@lccrsf.org

 

***PRESS RELEASE***
Litigation Victory Signals End to California Courts’ Illegal Late Fees That Penalized Poverty for Profit.

 

San Francisco, CA- The Lawyers’ Committee for Civil Rights of the San Francisco Bay Area, the ACLU Foundation of Northern California, and Bay Area Legal Aid, celebrate our final victory today as we announce the end of our lawsuit against the Judicial Council of California and San Mateo Superior Court. Read the final resolution filed here.

The lawsuit filed last year challenged the legality of exorbitant court late fees known as “civil assessments”—which California had encouraged courts to use to raise revenues. These fees—automatically assessed without judicial review, adequate notice, or consideration of a person’s circumstances—resulted in tremendous and unfair burdens on low-income Californians for the express purpose of raising court revenues. This obvious financial conflict of interest led to biased decision-making that violated the due process rights of hundreds of thousands of working Californians. In just three years, San Mateo Superior Court imposed late fees on 80,000 low-income residents—raising a whopping sum of over $9 million in revenues. To meet these profit goals, the Court automatically assigned fees at the maximum amount in every case, via computers, without a judge—violating California law.

These unconscionable practices are now at an end thanks to a collaborative settlement process with the Judicial Council of California and the Court. In response to our litigation, the Judicial Council of California has rescinded its illegal guidance regarding civil assessments and issued new guidance to California trial courts. San Mateo Superior Court has announced an official policy against civil assessment late fees, and at least nine other court systems have followed suit by promptly discontinuing their unlawful late fee programs. These victories come just months after the successful passage of AB-199—a new law signed in response to our litigation that eliminated the financial incentive for California courts to charge late fees for profit, erasing an astronomical $500 million to $1 billion in outstanding late fees that were illegally imposed by the California courts.

We celebrate the beginning of the end for California’s modern-day poverty tax. The civil assessment fee has never served any legitimate purpose besides punishing low-income Californians for simply being poor. The policy is rooted in the racist tough-on-crime policies of the 1990s, when it was created to address judicial funding shortages caused by the costs of mass incarceration. It is a needless and regressive tax that extracted millions of dollars annually—mostly from low-income and Black and Brown Californians. This revenue-generation scheme was particularly egregious given that California law already ensures that the government can collect from supposed “scofflaws” who can actually afford to pay their tickets through ordinary debt collection measures. In other words, civil assessments have only ever been about raising court revenue.

Courts across California are finally discontinuing their civil assessment programs as a direct result of the successful settlement with San Mateo, the passage of AB-199, and the Judicial Council’s new guidance. These major advances from the Judicial Council and the Court are a credit to the California judiciary.

Courts that fail to eliminate their unlawful fee schemes will risk future legal challenges and may pay the price. In settlement for this case, the Judicial Council of California paid $80,000 in Plaintiffs’ legal fees.

We will continue to fight on behalf of our clients until they are satisfied that these unlawful and unconstitutional practices have ended across California. California must end its reliance on regressive fees and fines to fill government coffers.

 

Attorney Statements:

“The sun is finally setting on California’s regressive taxation of working Californians for profit.” said Zal K. Shroff, a Senior Staff Attorney at the Lawyers’ Committee for Civil Rights of the San Francisco Bay Area (LCCRSF). “We celebrate these major steps toward economic justice at the Judicial Council and the Council’s recognition of the profound harms that fines and fees needlessly visit on low-income Californians. Our litigation has made clear to trial courts that even they are not above the law.”

“The fact that courts across California are starting to abandon their civil assessment practices is monumental: it will unburden thousands of low-income people -disproportionately from Black and Brown communities – who have been stuck in a cycle of poverty due to their inability to pay these unlawfully imposed court debts,” said Ariella Hyman, Director of Program and Advocacy at Bay Area Legal Aid.

 “This win is one step closer to California confronting the racialized impact of traffic stops,” said Brandon Greene, Racial and Economic Justice Program Director at the ACLU of Northern California. “For years, our coalitions have been making the clear case that the economic devastation wrought by California’s administrative fines and fees is both morally unjust and just bad fiscal policy. We will continue to fight until these and all other unnecessarily punitive fees are fully eliminated and ultimately repealed by the California Legislature.”

 

Client Statements:

“Debt from civil assessment fees pushed my family deeper into poverty and made it incredibly difficult for me to travel to work, provide for my children and put food on the table. No one deserves to endure this kind of punishment, especially not low-income Californians who are already struggling to survive. I am overjoyed by the outcome,” Lorena Gonzales Baes said.

“No one should ever be forced into unjust and illegitimate debt. I am ecstatic to see that California is on a path to ending all of its wealth extraction schemes while unburdening thousands of families of court debt. This is a major step in ending the generational cycle of poverty and incarceration and will allow communities like mine to breathe a little easier.” said Manuel Galindo, Carceral Debt Organizer, Debt Collective

“On behalf of the low-income community members we serve, we are overjoyed that San Mateo County and nine other court systems have disbanded their unlawful late fee programs and that the Judicial Council has issued new guidance to trial courts. This is a huge step in the right direction, but we need all of the trial courts to stop imposing civil assessments and garnering court revenue on the backs of low-income people of color,” said Katrina Logan, Executive Director, Community Legal Services of East Palo Alto.

 

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