A team of experienced class action lawyers is taking on California’s red light camera industry, and photo enforcement companies are expressing unease. Last month, the law firm of Pearson Simon Warshaw and Penny, LLP filed suit in San Mateo County Superior Court arguing that tickets issued throughout the Golden State since January 1, 2004 should be refunded where the photo enforcement contracts violated a state law mandating flat-rate compensation to companies like Redflex Traffic Systems. Redflex referred to the case as a particular business risk in an August 25 filing with the Australian Securities Exchange.
Despite collecting A$137 million in revenue from automated traffic ticketing, the Australian photo enforcement giant Redflex Traffic Systems yesterday announced its net profit before tax had fallen to a mere $442,000 for the first half of 2010. Redflex remains the number one player in the US market with US motorists providing 79 percent of the company’s ticket revenue. Redflex management, however, blamed recent losses primarily on “considerable public opposition” to photo radar and red light cameras in the US.
Officials in Tasmania, Australia last week reluctantly admitted that some of its speed cameras produced unreliable readings. The automated ticketing machines on Tasman Bridge were found to be issuing speeding tickets to vehicles that were not speeding, forcing a refund of 440 tickets issued between June 5 and July 5. According to The Mercury, a test of the device against a handheld speed gun showed inaccurate readings.
According to AZfamily.com, Arizona’s controversial freeway speed cameras will come down this week, as a result of governor Jan Brewer’s decision to not renew the state’s contract with Redflex. In addition to public opposition to the cameras, a lack of revenue flowing to the state appears to have been a factor in the decision to shut down the cameras. Apparently, the cameras generated over 7,000 tickets in their first year of operations, but because so many motorists simply ignored the tickets and the state didn’t have enough process servers, only about $30m of the estimated $90m in fines that should have been generated by those tickets was actually paid to the state. Arizona’s freeway speed cameras should be deactivated by this Friday.
Toll road giant Macquarie Bank this week announced its intention to acquire the leading operator of red light cameras and speed cameras in the US. Macquarie, known for its skill in harnessing government guarantees to make itself a “millionaire’s factory,” made an offer to purchase Redflex Traffic Systems of Australia at the bargain price of A$2.50 a share.
A federal jury ruled Thursday against a traffic camera company that had sought to impose a $20 million fine on its nearest rival. The panel of eight spent an hour-and-a-half to arrive at the verdict denying American Traffic Solutions (ATS) payment for contract revenue lost in twelve cities after the Australian firm Redflex Traffic Systems snuck uncertified equipment into the country in violation of Federal Communications Commission regulations.
With ballot initiatives and other possible legislative action threatening to put a major photo enforcement company out of business, an effective public relations strategy has become the firm’s top priority. Redflex Traffic Systems on Friday had its former corporate spokesman, Michael Ferraresi, return to writing about the industry for the Arizona Republic newspaper, which covers the battleground market of Phoenix.
The Las Cruces, New Mexico city council voted Monday to partially obey a New Mexico Department of Transportation (NMDOT) to remove red light cameras and speed cameras from the state right-of-way by May 18. State officials are concerned with the negative impact that the devices have on safety, but Las Cruces officials emphasized the need to “work around” the state in expanding the red light camera program even though the city has seen an increase in accidents where photo enforcement has been installed.
Lobbyists for municipalities and photo enforcement companies have succeeded in gutting attempts to place even the most minor of restrictions on the use of red light cameras and speed cameras in Arizona and Tennessee. For more than a year, the Tennessee General Assembly debated the wisdom of restricting the use of automated ticketing machines. A special study committee was established where state House members listened to testimony almost exclusively from representatives of cities and the private, for-profit companies that operate traffic cameras. The committee now has nothing to show for its effort.
Arizona Governor Jan Brewer’s administration has officially canceled the state contract that authorized Redflex Traffic Systems to issue automated freeway speeding tickets. The program, started in 2008 by Brewer’s Democratic predecessor Janet Napolitano, will be terminated according to statement issued earlier today to Australian Securities Exchange investors.