CA SB975

Creates civil liability for persons who cause another to incur "coerced debt" through duress, intimidation, threat of force, fraud, or undue influence, with liable parties owing the debt amount plus attorney's fees and costs to the claimant.

Requires claimants to cease collection activities upon receipt of adequate documentation and a debtor's sworn written statement that debt is coerced, and to complete a review and notify the debtor within 10 business days of their determination.

Allows debtors to bring actions or file cross-complaints against claimants to establish that a debt is coerced, and if proven by preponderance of evidence, entitles debtors to declaratory judgment, injunctions prohibiting collection, and case dismissal.

Requires courts to issue judgments against persons who coerced the debt in favor of the claimant and mandates protective measures such as sealed records and remote depositions to prevent abuse of the debtor or their family members.

Applies only to debts incurred on or after July 1, 2023, with an exception allowing debtors to file cross-complaints in pending collection cases involving debts incurred before that date if no final judgment has been entered.