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Governor Arnold Schwarzenegger State Capitol Sacramento, CA 95814 Dear Governor Schwarzenegger: I request your VETO of AB 437 (Jones), which could result in significant new employer liability and damages exposure in virtually any lawsuit challenging workplace decisions. AB 437 would codify in the California Code of Civil Procedure a sweeping statement that the recent ruling by the U.S. Supreme Court in Ledbetter v. Goodyear Tire & Rubber Co. (2007) 127 S. Ct. 2162 should be rejected for purposes of any statutes of limitation under existing California law, including but not limited to the Fair Employment and Housing Act (FEHA). By doing so, AB 437 does far more than merely “construe and clarify” existing law. It effectively instructs courts to adopt the alternative, a statute of limitations rule that is broad and limitless, potentially allowing for decades-old lawsuits and indefinite damages amounts. The Ledbetter case set forth a clear and objective rule that statutes of limitation, for purposes of workplace decisions, begin to run at the time of the employer’s decision and rejected the notion that they are renewed each time the employee’s pay are subsequently affected by that decision. This is consistent with current California statutory and case law, in which there is no blanket rule across all statutes that the repeated issuance of affected paychecks keeps lawsuits alive or that compensation merely being “affected” keeps a statute of limitations running. A vague and indefinite statute of limitations scheme is unworkable and undermines important public policies behind statutes of limitation. This includes prompt surfacing and resolution of potential claims through dialogue between employers and employees. Clear time limits also balance competing interests by providing plaintiffs a sufficient time to file charges while preventing courts and employers from facing stale claims in which evidence is lost, memories have faded, or witnesses are no longer available. Finally, I am concerned about AB 437’s potential retroactive application to pending cases. There is nothing limiting it to prospective claims. Thus, it appears AB 437 could also breathe life into stale claims not yet filed. Finally, AB 437 invites abuse of California’s employment laws and frivolous claims when unwarranted litigation is already an issue under so many California laws.

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