Here is the section:
4461.
(b) A person to whom a disabled person placard has been issued
shall not lend the placard to another person, and a disabled person
shall not knowingly permit the use for parking purposes of the
placard or identification license plate issued pursuant to Section
5007 by one not entitled to it. A person to whom a disabled person
placard has been issued may permit another person to use the placard
only while in the presence or reasonable proximity of the disabled
person for the purpose of transporting the disabled person. A
violation of this subdivision is subject to the issuance of a notice
of parking violation imposing a civil penalty of not less than two
hundred fifty dollars ($250) and not more than one thousand dollars
($1,000), for which enforcement shall be governed by the procedures
set forth in Article 3 (commencing with Section 40200) of Chapter 1
of Division 17 or is a misdemeanor punishable by a fine of not less
than two hundred fifty dollars ($250) and not more than one thousand
dollars ($1,000), imprisonment in the county jail for not more than
six months, or both that fine and imprisonment.
(c) Except for the purpose of transporting a disabled person as
specified in subdivision (b), a person shall not display a disabled
person placard that was not issued to him or her or that has been
canceled or revoked pursuant to Section 22511.6. A violation of this
subdivision is subject to the issuance of a notice of parking
violation imposing a civil penalty of not less than two hundred fifty
dollars ($250) and not more than one thousand dollars ($1,000), for
which enforcement shall be governed by the procedures set forth in
Article 3 (commencing with Section 40200) of Chapter 1 of Division 17
or is a misdemeanor punishable by a fine of not less than two
hundred fifty dollars ($250) and not more than one thousand dollars
($1,000), imprisonment in the county jail for not more than six
months, or both that fine and imprisonment.
Since the person to whom the placard was issued was not in the proximity, it appears they have a good case against you. Understand that this can also be charged as a misdemeanor ... though it is most often filed as an infraction. If you go to traffic court, it's an infraction. If it goes to criminal court, then you might want to speak with an attorney.
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