SB 235 Introduces New Civil Disclosure Rules for California

SB 235 Introduces New Civil Disclosure Rules for California

Estimated reading time: 6 minutes

The year 2024 ushered in new California civil disclosure rules that will shape litigation strategy in the state for at least the next three years.

Meet Senate Bill (SB) No. 235, which updates California’s Civil Discovery Act to streamline discovery in most California civil matters. The law’s provisions apply to most civil lawsuits filed between January 1, 2024, and January 1, 2027, and align California’s initial disclosures process with those of the Federal Rules of Civil Procedure (FRCP).

Why upend California’s established civil discovery procedures? The answer is simple: to level the playing field among parties during one of the most expensive, time-consuming phases of litigation. 

Before SB 235 took effect, parties in California litigation could meet their initial disclosure requirements by listing individuals and companies who could have access to relevant, discoverable information and associated insurance policies. This approach benefitted deeper-pocketed companies, allowing them to hint at where relevant information could be without furnishing it. However, it created burdens and increased costs for individuals and smaller businesses in finding this evidence. And even if a judge concluded a party did abuse discovery, they would only be fined $250 per sanction — an amount not even a small-cap company would blink at. 

California’s legislature passed SB 235 to change the power balance in discovery, encouraging parties to come to the table with more concrete information and avoid burdensome production requests. Will it completely solve the issues it plans to tackle? That remains to be seen; local challenges will be inevitable, requiring lawyers to track important developments (which CEB’s DailyNews can help with — even for free accounts). However, it is still a step in the right direction for parties facing litigation in one of the country’s largest legal markets.

What has changed?

California’s legislature intended SB 235’s changes to bring California civil discovery more in line with federal requirements. Section 2016.090, for example, requires parties to provide their initial disclosures within 60 days of a demand instead of within 45 days of a court’s order to provide the disclosures after stipulation by the parties. 

To meet these disclosure requirements, parties can no longer tease where important evidence may be; they must be more concrete in their responses. What would these initial disclosures need to include? The names, addresses, telephone numbers and email addresses of all individuals likely to have discoverable information that a disclosing party may use to support its claims or defenses or that is relevant to the subject matter of the action or any associated motion. It also encompasses copies, or descriptions by category and location, of all relevant documents and insurance policies.

SB 235 also imposes higher standards on what each side should disclose. Unlike under the FRCP, California parties must disclose witnesses and documents that are relevant to their cases — regardless of whether the information helps or hurts them. Litigants do not have to share impeachment evidence or information about their expert witnesses and consultants.

And remember the $250 fine per discovery violation from the previous law? California’s legislature quadrupled it to deter noncompliance and manipulation. Under Section 2023.050, the mandatory sanction for parties who fail to respond in good faith to discovery requests will now be $1,000 per incident.

How the changes could complicate discovery

Despite the good intent of California’s new civil disclosure rules, they still leave potential hurdles for civil litigants, particularly those without significant financial resources.

For one, SB 235 requires disclosures to be shared only in response to a party’s demand; it’s not automatic as it is in federal practice. The FRCP, for example, requires stays on all discovery in federal court until after the parties exchange information and before their first case management conference. This phase lasts 90 to 120 days after the lawsuit’s initial filing. Under SB 235, parties can request comprehensive discovery upon the lawsuit’s filing, which can be more in-depth, demanding and expensive to prepare.

It also remains to be seen how SB 235 will impact larger-scale disputes, including class actions and complex litigation. The only actions that SB 235 does not affect are those involving unlawful detainers, small claims and litigation involving self-represented parties. However, many experts, including some that CEB interviewed, consider the law to be drafted with single-plaintiff, single-defendant actions in mind. For class actions, this could complicate discovery for parties on both sides of the “v.,” likely forcing them to furnish initial disclosures to hundreds of different adversaries to achieve compliance (not to mention complying with California’s onerous class action procedures).

Even the penalty increases may not achieve their intended purpose and discourage abuse. Smaller defendants, such as small businesses, may think twice about noncompliance, given the new $1,000 fines. However, the new amounts may not be enough to dissuade the average Fortune 500 corporation or well-financed party from burying their opponents in discovery motions.

Furthermore, because SB 235 does not retroactively apply to pre-2024 cases, lawyers cannot toss aside the state’s old civil discovery rules. Lawyers litigating in California must be well-versed in both sets of civil disclosure rules until SB 235 sunsets on January 1, 2027.

California’s legal community will not know the law’s true impact until courts and lawyers begin adapting to the rules in practice. When CEB’s DailyNews contributors asked California practitioners for insights on SB 235’s potential impacts, they found the legal community’s outlook to be mixed.

Some lawyers surveyed viewed SB 235 as unnecessary due to discovery tools already available to California litigants. Katherine Gallo, a Foster City discovery referee who writes extensively on California discovery topics, suggested that California’s form interrogatories accomplish the same objectives since they “specifically ask questions as to the investigation, the contract, the injuries. They’re specific to categories.” By contrast, the breadth of SB 235 is designed “to get Moby-Dick.”

Others, like Consumer Attorneys of California President Greg Rizio, felt the law has some helpful benefits but may not deliver on its intended promises. Rizio told DailyNews that SB 235’s mandatory discovery sanctions increases can help plaintiffs’ attorneys. “In these particularly document-heavy cases — elder abuse, products liability — a lot of times you don’t get those documents, or they’re late in getting to you,” Rizio said. “This is a way to get what plaintiffs’ lawyers need early on in the litigation.” He added, however, that the increased penalties might not impact the strategies of deeper-pocketed corporate defendants.

Confronting the fallout

When SB 235 sunsets on January 1, 2027, California courts and attorneys will better understand if the state’s new civil disclosure rules led to more parity and fairness during discovery. In the meantime, companies, individuals and lawyers facing litigation in California must adjust their strategies to accommodate SB 235 and monitor challenges to the law. 

CEB’s civil practice resources and DailyNews updates can help lawyers stay up to speed on critical litigation developments around SB 235. With more than 75 years of experience educating the legal community on California regulatory developments, CEB can be any law firm’s trusted copilot in understanding and planning around California’s litigation rules. 

See how CEB can help you navigate California’s new civil disclosure rules.