Kabateck LLP founding partner Brian Kabateck and managing partner Shant Karnikian have contributed analyses to the Daily Journal’s 2026 New California Laws Supplement, which provides an overview of legislation enacted by the California Legislature in 2025.
Brian Kabateck examines AB 931, California’s first comprehensive regulatory framework for consumer legal funding. Consumer legal funding—where companies purchase plaintiffs’ contingent rights to settlement proceeds—has long provided financial support to injured parties awaiting case resolution, but the industry has operated without meaningful oversight. Effective January 1, 2026, the new law requires funding contracts in writing with plain-language disclosures, grants consumers a five-business-day cancellation right, and caps charges at 36 months from the funding date to prevent compounding spirals. The law also prohibits funding companies from paying attorney referral fees and bars California attorneys from sharing fees with out-of-state entities that allow non-lawyer ownership—a provision that will remain in effect until January 1, 2030.
Shant Karnikian analyzes SB 37, California’s most comprehensive reform of attorney advertising regulations in recent history. The law targets three primary areas: it prohibits misleading advertisements and restricts award references unless merit-based and free of charge; it requires attorneys to conspicuously display at least one bona fide office location or State Bar address; and it bars lawyers from marketing past case results unless they are objectively verifiable and not misleading through omission. Most notably, the law introduces a private right of action with statutory damages ranging from $5,000 to $100,000 per violation—empowering consumers and competitors to police false advertising through civil litigation. Karnikian advises practitioners to immediately audit all advertising materials, including websites, social media profiles, directory listings, and third-party advertisements, to ensure compliance before the law takes effect on January 1, 2026.
Read Brian Kabateck’s full analysis of AB 931 (subscription required).
Read Shant Karnikian’s full analysis of SB 37 (subscription required).