New No-Fault Car Insurance Initiative to Be Filed Today

Worried that the California Trial Lawyers Assn. might get a court ruling invalidating a no-fault automobile insurance initiative, the insurance industry said it will refile the initiative today, minus campaign contribution provisions that the lawyers had challenged.

An industry spokesman said the insurers are acting now, without knowing for sure that there would be an adverse court ruling, because if they wait for the court to act, there would not be sufficient time to qualify a new version of the initiative for the November ballot.

As it is, the insurers may not get the go-ahead from Atty. Gen. John K. Van de Kamp to circulate the new initiative until close to May 1. That would leave them only about a month before the deadline for submitting the required 372,000 signatures.

Insurance lobby spokesman George Tye said Thursday that the industry’s professional petition circulators are convinced that they have enough time to qualify the reworded initiative and thus avoid any possibility that the industry would be left without an initiative on the ballot this year.

‘Real Hard Deadline’

“We think around June 1 is the real hard deadline for submitting the signatures,” Tye said. “We do feel we could qualify it in four, five or six weeks.”

The industry action came, according to Tye, after the insurers’ lawyers advised them that a three-judge panel of the 3rd District Court of Appeal in Sacramento appeared to be seriously considering making a ruling striking down the initiative as illicit under state law.

The trial lawyers sued for such a judgment on Feb. 26. They contended that provisions in the no-fault initiative allowing elected officials who receive insurance industry campaign contributions to vote on matters affecting the industry were in violation of the state’s constitutional ban on including more than one subject in a single initiative.

Joe Remcho, attorney for the trial lawyers association, said Thursday that he too feels it is quite possible that the court of appeal will, as early as next Monday, issue a peremptory writ striking down the insurers’ initiative as presently written.

Remcho called the refiling by the insurance industry “virtually a concession of defeat” and hinted that the trial lawyers might file a new lawsuit seeking to invalidate the refiled initiative as well, perhaps on other grounds.

The trial lawyers are supporting their own auto insurance initiative, one that would call for some rate rollbacks by insurance companies and price regulation of insurance by the state Department of Insurance, even while leaving in place the system of litigation that the insurers’ no-fault system would restrict.

Without flatly predicting that the Court of Appeal would rule for the trial lawyers, Remcho said of the insurers, “They tried to pull a fast one (with their campaign contribution provisions in the no-fault initiative) and they got caught.”

The insurers’ spokesman, Tye, said that the industry had already obtained 325,000 signatures on behalf of its no-fault initiative in the original form. These will be kept, and new signatures will even be gathered, just in case the courts do reject the trial lawyers’ arguments after all.

But for now, Tye said, the insurers will go ahead with the initiative in its new form.

He expressed hope that Van de Kamp and other state officials would act as expeditiously as possible to assess the initiative’s fiscal impact and prepare a legal summary of it, thus allowing as much time as possible to circulate petitions.

Tye pointed out that the new initiative is identical to the old one, except for the one section that has been removed.

Van de Kamp and the other agencies, the state Finance Department and the state legislative analyst, together have about 40 days to assess the new initiative and prepare a summary of it.

Van de Kamp is on the steering committee of the competing initiative supported by the trial lawyers. Just last week he was accused by a proponent of yet another proposed insurance initiative of sitting on that initiative for as long as he was legally permitted in an attempt to reduce the chances that there would be enough time to circulate petitions for it.

Aides to the attorney general denied any such intent then, and they reiterated the denial Thursday.

But Assemblyman Richard Polanco (D-Los Angeles), angered by a legal mistake made in Van de Kamp’s office that resulted in the possible invalidation of thousands of signatures he had collected for yet another insurance initiative, has introduced legislation providing that in cases where the attorney general is committed to an initiative, he would have to give up preparing summaries for others competing with it.