settlement

Walt Disney Co. will pay $2.75 million to settle allegations that it violated the California Consumer Privacy Act by not fully complying with consumers’ requests to opt out of data sharing on its streaming services, the state attorney general’s office said Wednesday.

The Burbank media and entertainment company allegedly restricted the extent of opt-out requests, including complying with users’ petitions only on the device or streaming services they processed it from, or stopping the sharing of consumers’ personal data through Disney’s advertising platform but not those of specific ad-tech companies whose code was embedded on Disney websites and apps, the attorney general’s office said.

In addition to the fine, the settlement, which is subject to court approval, will require Disney to enact a “consumer-friendly, easy to execute” process that allows users to opt-out of the sale or sharing of their data with as few steps as possible, according to court documents.

“Consumers shouldn’t have to go to infinity and beyond to assert their privacy rights,” Atty. Gen. Rob Bonta said in a statement. “In California, asking a business to stop selling your data should not be complicated or cumbersome.”

A Disney spokesperson said in a statement that the company “continues to invest significant resources to set the standard for responsible and transparent data practices across our streaming services.”

“As technology and media continue to evolve, protecting the privacy and preserving the experience of Californians and fans everywhere remains a longstanding priority for Disney,” the spokesperson said.

The settlement with Disney stemmed from a 2024 investigation by the attorney general’s office into streaming devices and apps for alleged violations of the California Consumer Privacy Act, which governs the collection of consumers’ personal data by businesses.

Under the law, businesses that sell or share personal data for targeted advertising must give users the right to opt-out.

Disney’s $2.75-million payment is the largest such settlement under the state privacy act, Bonta’s office said.

The attorney general has also reached settlements with companies such as beauty retailer Sephora, food delivery app DoorDash and SlingTV for alleged violations of the privacy act.

The Los Angeles City Council has again increased what it will pay Gibson Dunn to represent it in a contentious homelessness case, bringing the law firm’s contract to nearly $7.5 million.

In mid-May, the council approved a three-year contract capped at $900,000. The law firm then billed the city $1.8 million for two weeks of legal work, with 15 of its attorneys charging nearly $1,300 per hour.

In a closed-door meeting Wednesday, the council voted 9-4 to approve an increase of about $1.8 million from the current $5.7 million, with Councilmembers John Lee, Tim McOsker, Imelda Padilla and Monica Rodriguez opposed. It was not clear why the additional money was needed.

Rodriguez said that spending resources on outside lawyers instead of complying with the settlement terms in the case is “simply a waste of public funds.”

“In the face of a mounting homelessness crisis, it’s misguided for the City to continue pouring our scarce resources into outside counsel instead of housing the most vulnerable Angelenos,” Rodriguez said in a statement.

The contract “has expanded significantly beyond its original scope,” Lee said in a statement, later adding, “I believe the Council has a duty to demand transparency and closely scrutinize costs.”

The L.A. city attorney’s office did not respond to a request for comment.

The city reached a settlement with the nonprofit LA Alliance in 2022, agreeing to create 12,915 homeless shelter beds or other housing opportunities, while also clearing thousands of encampments.

Since then, the LA Alliance has repeatedly accused the city of failing to comply with the terms of the settlement agreement.

Gibson Dunn was retained by the city a week before a federal judge called a seven-day hearing to determine whether he should take authority over the city’s homelessness programs from Mayor Karen Bass and the City Council. Alliance lawyers said during those proceedings that they wanted Bass and two council members to testify.

The judge later declined to put Los Angeles’ homelessness programs into receivership, even as he concluded that the city failed to adhere to the settlement.

Theane Evangelis, a Gibson Dunn attorney who led the firm’s LA Alliance team, did not immediately respond to a request for comment.

City Atty. Hydee Feldstein Soto has praised Gibson Dunn’s work in the LA Alliance case, saying the firm helped the city retain control over its homelessness programs while also keeping Bass and the two council members off the stand.

She commended the firm — which secured a landmark Supreme Court ruling that upheld laws prohibiting homeless people from camping in public spaces — for getting up to speed on the settlement, mastering a complex set of policy matters within a week.

Faced with lingering criticism from council members, Feldstein Soto agreed to help with the cost of the Gibson Dunn contract, committing $1 million from her office’s budget. The council has also tapped $4 million from the city’s “unappropriated balance,” an account for funds that have not yet been allocated.

On Thursday, Matthew D. Umhofer, an attorney who represents LA Alliance, called the Gibson Dunn contract increase “predictable.”

“It’s a taxpayer-funded debacle designed to help city officials avoid being held accountable for their failures on homelessness,” Umhofer said in a statement. “The amount will keep going up as long as the City is more interested in ending oversight than ending homelessness.”

Los Angeles County will halt some payments from its $4-billion sex abuse settlement, leaving many plaintiffs on edge as prosecutors ramp up an investigation into allegations of fraud.

L.A. County agreed last spring to the record payout to settle a flood of lawsuits from people who said they’d been sexually abused by staff in government-run foster homes and juvenile camps. Many attorneys had told their clients they could expect the first tranche of money to start flowing this month.

But the county’s acting chief executive officer, Joseph M. Nicchitta, said Thursday that the county would “pause all payments” for unvetted claims after a request by Dist. Atty. Nathan Hochman. These are claims that have been flagged as requiring a “higher level of scrutiny,” according to a joint report submitted Thursday by attorneys in the settlement.

The district attorney announced he would investigate the historic settlement after reporting by The Times that found some plaintiffs who said they were paid to sue. Investigators have found “a significant number of cases where we believe there is potential fraud,” according to a spokesperson for the prosecutor’s office. The State Bar is spearheading a separate inquiry into fraud allegations.

On Jan. 9, Hochman formally requested the county pause the distribution of funds for at least six months, which he said would give his office “a reasonable opportunity to complete critical investigative steps.”

“Premature disbursement of settlement funds poses a substantial risk of interfering with the investigation by complicating witness cooperation, obscuring financial trails, and impairing my office’s ability to identify and prosecute fraudulent activity,” Hochman wrote in a letter to Andy Baum, the county’s main outside attorney working on the settlement.

Plaintiff lawyers argued the county was required to turn over money by the end of the month.

The county said it came to an agreement Thursday and plans to turn over $400 million on Friday, which would “cover claims that have already been validated,” according to a statement from Nicchitta. That money will go into a fund where it will be distributed when judges are finished vetting and deciding how much each claim is worth.

“No plaintiff was getting paid until the allocation process is completed,” said the county’s top lawyer, Dawyn Harrison. “The County is not overseeing that intensive process.”

The rest of the payments, Nicchitta said, will be on hold until the claims can “be appropriately investigated.”

“The County takes extremely seriously its obligations to provide just compensation to survivors. Preventing fraud is central to that commitment,” he said. “Fraudulent claims of sexual assault harm survivors by diluting compensation for survivors and casting public doubt over settlements as a whole.”

The uncertainty has sparked a sense of despair among those who spent the last few years wading through the darkest memories of their lives in hopes of a life-changing sum.

Andrea Proctor, 45, said the last few years have been like “digging into a scar that was healed.”

“The whole lawsuit just blew air out of me,” said Proctor, who sued in 2022 over alleged abuse at MacLaren Children’s Center, an El Monte shelter where she says she was drugged and sexually abused by staff as a teenager. “I’m just sitting out here empty.”

Proctor said she desperately needs the money to stabilize her life, the first part of which was spent careening from one crisis to the next — an instability she traces partially to the abuse she suffered as a minor.

Since a 2020 law change that extended the statute of limitations to sue over childhood sexual abuse, thousands have come forward with claims of abuse in county-run facilities dating back decades. The county resolved claims it faced last year through two massive payouts — the first settlement for $4 billion, which includes roughly 11,000 plaintiffs, and a second one last October worth $828 million, which includes about 400 victims.

Now, according to court filings made public Tuesday, the county faces an additional 5,500 claims of the same nature, leaving the prospect of a third hefty payout looming on the horizon.

“They’re telling me the ship has sailed,” said Martin Gould, a partner with Gould Grieco & Hensley, who said he wants this next flood of litigation to focus on pushing for arrests of predatory staff members still on the county’s payroll. “I don’t believe that.”

Gould says his firm, based in Chicago, represents about 70 victims in the new litigation. James Harris Law Firm, a small Seattle-based firm that specializes in big personal injury cases, has about 3,000. The Right Trial Lawyers, a firm that lists a Texas office as its headquarters, has about 700, according to an attorney affiliated with the firm.

These lawyers will be pleading their cases in front of a public — and a Board of Supervisors — at a moment when the conversation has shifted from a reckoning over systemic sexual abuse inside county facilities to concerns about the use of taxpayer money.

A series of Times investigations last fall found nine clients represented by Downtown LA Law Group, or DTLA, who said they were paid by recruiters to sue. Four said they were told to make up their claims.

All the lawsuits filed by the firm, which represents roughly a quarter of the plaintiffs in the $4-billion settlement, are now under review by Daniel Buckley, a former presiding judge of the county’s Superior Court.

DTLA has repeatedly denied any wrongdoing and said in a previous statement that it “categorically does not engage in, nor has it ever condoned, the exchange of money for client retention.”

Several DTLA clients said they were unaware of the probes by the State Bar and the district attorney, though they were told this month to expect delays in payments due, in part, to “a higher-than-expected false claim potential.”

The delays have caused extra anguish for some plaintiffs who have taken out loans against their settlement.

Proctor took out loans worth $15,000 from High Rise Financial, an L.A.-based legal funding company, which collects a larger portion of her payout with each passing year. She now owes more than $34,000, according to loan statements.

Proctor said High Rise Financial recently inquired about buying her out of the settlement payment, which the county is expected to pay out over five years. The loan company told her she could get a percentage of her settlement up front in a lump sum, with the company pocketing the rest as profit. For example, she said, she was told if she received a $300,000 payout, she could get $205,000 up front.

“Conversations were held with consumers to assess their interest in a potential financial arrangement related to a possible settlement,” High Rise said in a statement. “No agreements were sent, nor were any transactions entered into.”

Proctor’s friend Krista Hubbard, who also sued over abuse at MacLaren Children’s Center, borrowed $20,000 to help her through a period of homelessness. She now owes nearly $43,000. She said she, too, got the same offer this month from High Rise of getting bought out of her settlement.

Hubbard, who is crashing at the home of her godfather in Arkansas, said she’s considering it.

“How much longer is it going to take?” she said. “Am I going to be able to not be homeless?”

The $828-million settlement, which includes just three law firms, is running into its own roadblock with lawyers belatedly learning that roughly 30 of their clients were also set to receive money from the $4-billion settlement despite rules barring plaintiffs from receiving money from both.

The overlap has led to a dispute over which pot of money should cover payments to those plaintiffs. Those in the $828-million settlement, which has a much smaller pool of plaintiffs, are expected to get much more.

“It reeks,” said Courtney Thom, an attorney with Manly Stewart & Finaldi, who said she believed the county should have flagged long ago that there were identical clients in both settlements.

“It is not for me to fact-check for the county,” she told Judge Lawrence Riff at a court hearing Wednesday. “It is not for me to cross-reference names.”

Some of these plaintiffs had two different sexual abuse claims against the county — for example, one lawsuit alleged abuse in foster care while a second involved juvenile halls. Other clients had identical claims in both groups and mistakenly believed the two firms that represented them were compiling the information into one claim, Thom said.

Baum, the outside attorney defending the county, told Riff he wanted to ensure the clients didn’t “have their hands in two cookie jars.”