Kansas City, MO, February 4, 2026
U.S. Representative Sam Graves introduces legislation to protect small businesses from ‘sue and settle’ lawsuits, which can impose excessive compliance costs. This new bill aims to create a fairer regulatory environment, allowing small business owners to make necessary adjustments without the fear of facing costly litigation. By addressing these legal challenges, Graves hopes to foster innovation and promote economic growth in Kansas City and nationwide.
Kansas City, MO
Safeguarding Small Business Innovation: Rep. Graves Targets ‘Sue and Settle’ Lawsuits
Kansas City’s entrepreneurial spirit thrives on innovation and hard work, with local businesses forming the bedrock of our community. However, regulatory complexities and legal challenges can often divert precious resources from growth and job creation. Recently, a significant legislative effort has been introduced to address one such challenge: “sue and settle” lawsuits that disproportionately impact small businesses across the nation.
This initiative aims to create a more predictable and equitable environment for Kansas City small business owners and their counterparts nationwide, fostering resilience and encouraging economic expansion by reducing the burden of exploitive legal practices. For many entrepreneurs in Missouri and beyond, navigating an ever-evolving regulatory landscape is a constant balancing act, and efforts to streamline processes are always welcome for promoting sustainable economic growth.
Understanding “Sue and Settle” Lawsuits
The term “sue and settle” describes a process where a federal agency is sued by special interest groups, and instead of engaging in a full legal defense, the agency agrees to a settlement. These settlements can lead to the creation of new rules and regulations outside of the standard, transparent rulemaking process, often without sufficient public participation or input from affected parties. Critics argue that these agreements can allow private entities to exert undue influence over public policy and agency priorities.
Historically, such practices have been observed in environmental lawsuits involving federal agencies like the Environmental Protection Agency (EPA) and the U.S. Fish and Wildlife Service (FWS). The resulting regulations, which often stem from these closed-door negotiations, can impose significant compliance costs and operational complexities on businesses, particularly smaller enterprises.
The Disproportionate Burden on Small Businesses
Small businesses, the engines of job creation and local economies, often bear a disproportionate share of regulatory burdens. Nationwide, firms employing fewer than 20 employees can face an annual regulatory burden that is nearly 60 percent higher per employee compared to companies with over 500 employees. These compliance costs can impact various aspects of a firm’s operations, including resource allocation, production, productivity, profitability, and expansion.
A recent survey indicated that 51% of small businesses nationwide believe that navigating regulatory compliance requirements negatively impacts their growth. Additionally, 47% report spending too much time fulfilling these requirements. When faced with lawsuits, small businesses are frequently targeted because they often lack the time or extensive resources needed to sustain prolonged litigation, making settlement a more likely, albeit costly, outcome. This dynamic allows some legal actions to become what some characterize as “quick cash grabs” rather than genuine efforts to resolve issues or ensure access.
Congressman Graves’ Initiative for Protection
In response to these concerns, U.S. Representative Sam Graves, a Republican from Missouri’s 6th congressional district (MO-06), introduced legislation aimed at protecting small businesses from what he terms “exploitive sue-and-settle” lawsuits. The bill, known as the Protecting Small Businesses from Predatory Website Lawsuits Act, specifically addresses instances where small businesses nationwide are targeted with “copy-and-paste demand letters” alleging their websites are not compliant with the Americans with Disabilities Act (ADA).
The core purpose of this Nationwide legislation is to provide small businesses with an opportunity to make their websites accessible for Americans with disabilities, rather than immediately being drawn into expensive litigation. Congressman Graves has stated that businesses should not be forced to choose between legal fees and paying their employees, emphasizing that these lawsuits, in many cases, are not primarily about promoting accessibility but about generating profit from hardworking business owners.
Fostering Innovation Through Clearer Pathways
This legislative effort aligns with a broader philosophy that reducing unnecessary regulatory burdens can unleash entrepreneurial innovation and bolster Kansas City’s economic growth. When small businesses, particularly Missouri MO entrepreneurs, are freed from the constant threat of predatory legal actions and excessive red tape, they can dedicate more resources and energy to expanding their operations, hiring new staff, and developing innovative products and services.
The intent behind this bill is to introduce a period for remediation, allowing small businesses to correct alleged compliance issues before facing severe penalties or costly lawsuits. This approach recognizes the often-unintentional nature of non-compliance for small operators and seeks to provide a practical pathway to accessibility, rather than a punitive one. By fostering an environment where compliance is achieved through cooperation rather than immediate confrontation, the legislation aims to support the resilience and sustained growth of Kansas City small business owners.
A Nationwide Call for Transparency
The issue of “sue and settle” practices has drawn Nationwide attention over the years, with calls for increased transparency and public engagement in agency rulemaking. Efforts have been made to limit an agency’s ability to enter into certain settlement agreements without allowing third parties, such as regulated industry interests, to intervene. These proposals often include requirements for publishing agreements in the Federal Register and soliciting public comment.
The initiative by Rep. Graves reflects this Nationwide sentiment, aiming to ensure that regulations and legal interpretations are developed through open and fair processes. For the vibrant business community in Kansas City and across the country, a more transparent and predictable regulatory environment is crucial for making informed decisions, allocating resources effectively, and ultimately contributing to robust economic growth.
Conclusion
The introduction of legislation by Representative Sam Graves targeting “sue and settle” lawsuits represents a significant step towards creating a fairer legal and regulatory landscape for small businesses nationwide. By aiming to protect local businesses from exploitive litigation and fostering a culture of compliance through opportunity rather than immediate penalty, this effort seeks to empower Missouri MO entrepreneurs and support the continued vitality of the Kansas City MO business sector. We encourage all residents to stay engaged in the ongoing dialogue surrounding policies that shape our local economy and to champion the small businesses that make Kansas City a dynamic and prosperous place to live and work.
Frequently Asked Questions
- What are “sue and settle” lawsuits?
- “Sue and settle” lawsuits refer to a process where a federal agency agrees to a settlement agreement, in a lawsuit from special interest groups, to create priorities and rules outside of the normal rulemaking process. These settlements are often negotiated behind closed doors with no participation from the public or affected parties.
- How do “sue and settle” lawsuits impact small businesses?
- New regulations resulting from “sue and settle” practices can disproportionately affect small businesses due to compliance costs, impacting their resource allocation, production, productivity, profitability, and expansion. Small businesses are often targeted because they may lack the resources to litigate, making settlement a more likely outcome.
- What is the purpose of Rep. Sam Graves’ new legislation?
- U.S. Representative Sam Graves introduced legislation, specifically the “Protecting Small Businesses from Predatory Website Lawsuits Act,” aiming to protect small businesses nationwide from what he calls “exploitive sue-and-settle schemes”. The bill focuses on lawsuits concerning ADA-compliant websites, giving small businesses a chance to make corrections instead of facing immediate, costly litigation.
- What is the scope of Rep. Graves’ legislation?
- The legislation introduced by Rep. Graves, the Protecting Small Businesses from Predatory Website Lawsuits Act, aims to protect small businesses nationwide.
- What are the broader arguments against “sue and settle” practices?
- Arguments against “sue and settle” practices include concerns about a lack of transparency, the circumvention of public input, and the potential for private groups to exert outsized influence over public policy and regulatory agendas.
Key Features of Legislation Targeting “Sue and Settle” Lawsuits
| Feature | Description | Scope |
|---|---|---|
| Legislator | U.S. Representative Sam Graves (R-MO-06) | State-level (Representative’s district) |
| Legislation Name | Protecting Small Businesses from Predatory Website Lawsuits Act | Nationwide |
| Primary Target | “Exploitive sue-and-settle” lawsuits against small businesses, specifically regarding ADA website compliance claims | Nationwide |
| Goal | To protect small businesses from predatory litigation by providing a chance to rectify alleged non-compliance before facing extensive legal costs. | Nationwide |
| Impact on Small Businesses | Aims to reduce the disproportionate regulatory burden and financial strain on small businesses, fostering economic growth and entrepreneurial innovation. | Nationwide |
| Transparency Concern Addressed | Addresses the issue of regulations being developed outside of normal, transparent rulemaking processes. | Nationwide |
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Author: STAFF HERE KANSAS CITY WRITER
The KANSAS CITY STAFF WRITER represents the experienced team at HEREKansasCity.com, your go-to source for actionable local news and information in Kansas City, Jackson County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as American Royal World Series of Barbecue, Dia De Los Muertos, and Planet Anime Kansas City. Our coverage extends to key organizations like the Greater Kansas City Chamber of Commerce and United Way of Greater Kansas City, plus leading businesses in healthcare, finance, and entertainment that power the local economy such as Children's Mercy Hospital, Government Employees Health Association, and AMC Entertainment. As part of the broader HERE network, including HEREStLouis.com, we provide comprehensive, credible insights into Missouri's dynamic landscape.
