Source: https://www.uclpractitioner.com/ucl_remedies_in_general/
Timestamp: 2019-04-23 06:51:37+00:00

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Posts categorized "UCL - remedies in general"
New UCL "injury in fact" opinion: Ivanoff v. Bank of America, N.A.
Whether or not Ivanoff’s allegation that she “stands to lose her home” adequately pleaded injury in fact under the UCL, Ivanoff also alleged, as a result of the Bank’s unlawful business practices, she paid money to the Bank and received billings for increased monthly loan payments in excess of what she should have owed (or was told she would owe). No more is required to allege injury in fact.
Ivanoff v. Bank of America, N.A., ___ Cal.App.5th ___ (Mar. 13, 2017), slip op. at 13-16. However, the UCL claim was time-barred. It accrued no later than May 2011, more than four years before suit was filed in August 2015. Id. at 17-19.
The UCL and secondary liability: Daniels v. Select Portfolio Services, Inc.
In an opinion handed down in April of this year, the Court of Appeal (Sixth Appellate District) reconfirmed the rule that UCL liability can be predicated on an agency or conspiracy theory. Daniels v. Select Portfolio Services, Inc., 246 Cal.App.4th 1150, 1188 (2016) (citing People v. JTH Tax, Inc., 212 Cal.App.4th 1219, 1242 (2013); People v. Bestline Products, Inc., 61 Cal.App.3d 879, 918-19 (1976)).
This blog's discussion of People v. JTH Tax, Inc. is available at this link. People v. Bestline Products was a little before the blog's time, but see this post for a discussion of more recent decisions on aiding and abetting liability under UCL.
In Beaver v. Tarsadia Hotels, 816 F.3d 1170 (9th Cir. Mar. 10, 2016), the Ninth Circuit considered a UCL "unlawful" prong claim predicated on violation of a federal statute. The UCL's four-year statute of limitations governed, the court held—not the shorter limitations period of the "borrowed" federal statute. Id. at 1177-78. Nor did the shorter limitations period preempt "the UCL's more generous" one. Id. at 1778-81.
A cert. petition was filed in June and remains pending. Possibly, the petition focuses on the court's holdings in the second half of the opinion, which considered whether the "borrowed" federal statute (the Interstate Land Sales Full Disclosure Act, 15 U.S.C. § 1701 et seq.) applied to the defendant's conduct. Id. at 1781-88.
Many thanks to the blog reader who brought this case to my attention. Although I have not been blogging as frequently this year as I have in the past, I always enjoy and appreciate hearing from my wonderful readers.
Not only is there no analogous case applying the [unclean hands] doctrine to an action pursuant to [Public Contract Code] section 7107, there are analogous cases holding as a matter of law that the doctrine does not apply to such statutory causes of action.
Id. at 20-21 (emphasis and hyperlink added). My original post on Ticconi (before rehearing) is here.
New UCL primary jurisdiction opinion: Guerrero v. Pacific Gas & Elec. Co.
In Guerrero v. Pacific Gas & Electric Co., ___ Cal.App.4th ___ (Oct. 10, 2014), the Court of Appeal (First Appellate District, Division Three) affirmed the trial court's ruling that allowing the plaintiff's UCL claim against PG&E to proceed would interfere with the jurisdiction of the Public Utilities Commission.
The UCL action was filed in the wake of the 2010 San Bruno gas line explosion, and sought retitution of those portions of PG&E's revenues that plaintiffs claimed should have been, but were not, expended on safety-related projects. Slip op. at 1-2.
New decision addresses (briefly) UCL standing: Boorstein v. CBS Interactive, Inc.
In Boorstein v. CBS Interactive, Inc., ___ Cal.App.4th ___ (Dec. 19, 2013), the Court of Appeal (Second Appellate District, Division Four) held that the plaintiff lacked standing to bring a claim against the defendant for violating the "shine the light" law (Civil Code §§ 1798.83 et seq.). Slip op. at 9-18. The panel determined that the plaintiff had not been "injured by a violation of this title," as the "shine the light" law requires. Id. at 9 (quoting Civ. Code § 1798.84).
The UCL provides that to pursue a claim for relief under the statute, an individual must have “suffered injury in fact and ha[ve] lost money or property as a result of the unfair competition.” (Bus. & Prof. Code, § 17204.) For the reasons stated above, plaintiff failed to allege an “injury in fact.” Thus, he has not stated a claim for relief under the UCL. The demurrer to the second cause of action was properly sustained.
New UCL statute of limitations opinion: Fuller v. First Franklin Financial Corp.
In Fuller v. First Franklin Financial Corp., ___ Cal.App.4th ___ (May 1, 2013; pub. ord. May 29, 2013), the Court of Appeal (Third Appellate District) reinstated the plaintiffs' UCL and other claims, all of which the trial court had dismissed on the pleadings as barred by the statute of limitations. The Court held that the complaint adequately alleged facts sufficient to bring the case within the doctrine of fraudulent concealment, as construed in Aryeh v. Canon Business Solutions, Inc., 55 Cal.4th 1185 (2013) (discussed in this blog post).
The case is not a class action. It involves alleged misrepresentations by a lender and broker in connection with a home purchase.
Ninth Circuit en banc panel issues narrow arbitration opinion: Kilgore v. KeyBank, N.A.
In its original three-judge panel opinion last year, the Ninth Circuit held in no uncertain terms that under Concepcion, "the FAA preempts the Broughton-Cruz rule." Kilgore v. KeyBank, N.A., 673 F.3d 947, 951 (9th Cir. 2012) (hyperlinks added).
We hold that the Broughton-Cruz rule does not survive Concepcion because the rule "prohibits outright the arbitration of a particular type of claim"—claims for broad public injunctive relief. Concepcion, 131 S.Ct. at 1747. Therefore, our statement in Davis—that Broughton and Cruz prohibit the arbitration of public injunctive relief claims in California—is no longer good law. See 485 F.3d at 1082.
The UCL authorizes broad injunctive relief to protect the public from unfair business practices. Cal. Bus. & Prof. Code § 17203. The Supreme Court has suggested that claims arising from a statute whose underlying purpose creates an “inherent conflict” with the federal policy favoring arbitration may be exempt from the FAA. Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 26 (1991). Relying on Gilmer, the California Supreme Court has found an inherent conflict between the FAA policy favoring arbitration and California statutes authorizing “public” injunctive relief. Broughton v. Signa Healthplans of Cal., 988 P.2d 67, 73, 78 (Cal. 1999).
The Broughton plaintiffs “were covered by Medi-Cal, which had negotiated a contract with Cigna ... for health care coverage.” Id. at 71. They sued Cigna under California’s Consumer Legal Remedies Act (“CLRA”), Cal. Civ. Code §§ 1750–85, seeking damages for medical malpractice and injunctive relief against Cigna’s allegedly deceptive advertising. Broughton, 988 P.2d at 71. The California Supreme Court held the damages claim subject to the arbitration clause in the Cigna policy because “[s]uch an action is primarily for the benefit of a party to the arbitration, even if the action incidentally vindicates important public interests.” Id. at 79. But the Court also found that because the plaintiffs were “functioning as a private attorney general, enjoining future deceptive practices on behalf of the general public,” id. at 76, their injunction claims were not arbitrable, id. at 75–78.
The California Supreme Court expanded upon Broughton in Cruz v. PacifiCare Health Systems, Inc., 66 P.3d 1157 (Cal. 2003). .... Extending the reasoning of Broughton to claims brought under the UCL and Business and Professions Code, the Cruz court found “the request for injunctive relief is clearly for the benefit of health care consumers and the general public” and therefore not subject to arbitration. Id. at 1164.
Defendants argue that Davis was vitiated by Concepcion, and the Broughton-Cruz rule no longer exempts a public injunction claim from arbitration. We need not reach that broad argument. Even assuming the continued viability of the Broughton-Cruz rule, Plaintiffs’ claims do not fall within its purview.
Public injunctive relief “is for the benefit of the general public rather than the party bringing the action.” Broughton, 988 P.2d at 78. A claim for public injunctive relief therefore does not seek “to resolve a private dispute but to remedy a public wrong.” Id. at 76. Whatever the subjective motivation behind a party’s purported public injunction suit, the Broughton rule applies only when “the benefits of granting injunctive relief by and large do not accrue to that party, but to the general public in danger of being victimized by the same deceptive practices as the plaintiff suffered.” Id.
The claim for injunctive relief here does not fall within the “narrow exception to the rule that the FAA requires state courts to honor arbitration agreements.” Cruz, 66 P.3d at 1162.
Slip op. at 14-17 (footnote omitted).
The opinion concludes, as did the original opinion, that the arbitration clause was not unconscionable under Armendariz. Id. at 10-14.
Judge Pregerson dissented. His opinion provides some additional factual context and includes the plaintiffs' fine-print contracts (for tuition loans for an education they never received) as an appendix. Slip op. at 18-26 & Appx. A.
The new opinion is not the legal watershed as it could have been. The California Supreme Court has denied review in two cases holding that the Broughton/Cruz rule remains good law. The dissent is worth reading.
In article on the opinion Friday, the San Francisco Chronicle reported that "[s]tudents at an Oakland helicopter pilot school that folded in 2008 can't sue a bank for relief from unpaid loans and must take their cases to arbitration, a federal appeals court ruled Thursday. .... In an indignant dissent, Judge Harry Pregerson said the [arbitration] fee, a confidentiality requirement and other arbitration provisions were one-sided and unfair. KeyBank 'participated in the fraud that Silver State [Helicopters] perpetrated on unwitting students' and should be held accountable in court, Pregerson said."
Pending cert. petition of interest: Pom Wonderful LLC v. The Coca-Cola Co.
In June, the Ninth Circuit handed down its opinion in Pom Wonderful LLC v. The Coca-Cola Co., 679 F.3d 1170 (9th Cir. 2012), discussed in this blog post. Pom sued Coca-Cola for allegedly mislabeling its "pomegranate blueberry" juice, which according to the lawsuit actually consists mostly of grape and apple juices. The Ninth Circuit allowed Pom's state-law claims, including its UCL claim, to proceed, but found the Lanham Act claims barred.
In December, Pom filed a cert. petition with the U.S. Supreme Court. POM Wonderful LLC v. The Coca Cola Co., No. 12-761 (U.S.). The case was distributed for conference on March 22, 2013, and on March 25, the Court invited the Solicitor General to file a brief. This development suggests some interest in the case.
Although it's not a UCL case, Acosta v. Brown, ___ Cal.App.4th ___ (Jan. 30, 2013), is instructive. It discusses several leading UCL decisions on the economic abstention doctrine, such as Alvarado v. Selma Convalescent Hospital, 153 Cal.App.4th 1292 (2007) (discussed in this blog post), Arce v. Kaiser Foundation Health Plan, Inc., 181 Cal.App.4th 471 (2010) (discussed here), and Desert Healthcare Dist. v. PacifiCare FHP, Inc., 94 Cal.App.4th 781 (2001).
This doctrine is sometimes referred to as the "equitable abstention doctrine," but this is a misnomer. It applies only in cases involving "complex economic and/or political issues [and where] the nature of the relief sought would uncommonly burden the court." Acosta, slip op. at 12 n.7 (citing Alvarado).
Supreme Court holds that ordinary claims accrual rules, including the delayed discovery doctrine, apply to UCL claims: Aryeh v. Canon Business Solutions, Inc.
Yesterday, in Aryeh v. Canon Business Solutions, Inc., ___ Cal.4th ___ (Jan. 24, 2013), the Supreme Court held that common-law rules governing claims accrual (including the delayed discovery rule, the doctrine of equitable tolling, fraudulent concealment, the continuing violation doctrine, and the continuous accrual doctrine) apply to UCL claims -- just as they would to any other claim. The unanimous opinion was authored by Justice Werdegar.
Section 17208 was passed in 1977 as part of an act that consolidated and recodified existing state unfair competition laws without substantive change in the Business and Professions Code. (Stats. 1977, ch. 299, § 1, p. 1203; Assem. Off. of Research, 3d reading analysis of Assem. Bill No. 1280 (1977-1978 Reg. Sess.) as introduced Mar. 31, 1977, p. 1.) The adoption of an express statute of limitations was not intended to modify but to clarify the presumed applicable limitations period. (Assem. Com. on Judiciary, Bill Digest of Assem. Bill No. 1280 (1977-1978 Reg. Sess.) p. 1.) On the question of accrual, legislative committee reports are conspicuously silent, and the enrolled bill report expressly confirms the understanding that the subject is to be governed not by statute but by judicial construction: “Questions concerning the point at which the statute of limitations begins will be left to judicial decision.” (Governor’s Off. of Legal Affairs, Enrolled Bill Rep. on Assem. Bill No. 1280 (1977-1978 Reg. Sess.) June 27, 1977, p. 1.) It thus appears the Legislature, by passing a bare-bones limitations statute and delegating to the judiciary the task of defining the point of accrual in particular cases, left courts free to determine whether the circumstances in each case call for application of either the general last element rule of accrual or any of its equitable exceptions.
Slip op. at 7-8 (emphasis added).
Broberg involved a statute of limitations challenge to a claim of deceptive practices under the UCL. The court reasoned that the underlying nature of the claim, not its form, should control. (See Jefferson v. J. E. French Co. (1960) 54 Cal.2d 717, 718 [“[T]the nature of the right sued upon, not the form of action or the relief demanded, determines the applicability of the statute of limitations.”].) Consequently, that the cause of action was pleaded under the UCL should not preclude application of an equitable exception to the usual accrual rule; just like common law claims challenging fraudulent conduct, a UCL deceptive practices claim should accrue “only when a reasonable person would have discovered the factual basis for a claim.” (Broberg, at pp. 920-921.) Broberg is consistent with both our precedent and the absence of anything in the text or legislative history of the UCL establishing a legislative desire either to categorically limit or categorically guarantee the application of common law accrual exceptions under the UCL.
Accordingly, we conclude the UCL is governed by common law accrual rules to the same extent as any other statute. That a cause of action is labeled a UCL claim is not dispositive; instead, “the nature of the right sued upon” (Jefferson v. J. E. French Co., supra, 54 Cal.2d at p. 718) and the circumstances attending its invocation control the point of accrual. The common law last element accrual rule is the default (see Neel v. Magana, Olney, Levy, Cathcart & Gelfand, supra, 6 Cal.3d at p. 187), while exceptions to that rule apply precisely to the extent the preconditions for their application are met, as would be true under any other statute. We disapprove Snapp & Associates Ins. Services, Inc. v. Robertson, supra, 96 Cal.App.4th 884, and Salenga v. Mitsubishi Motors Credit of America, Inc., supra, 183 Cal.App.4th 986, to the extent they hold otherwise.
 As well, the UCL and its remedies are equitable. (Korea Supply Co. v. Lockheed Martin Corp., supra, 29 Cal.4th at p. 1144.) It would be inconsistent to conclude that while equity may drive the availability of remedies under the UCL, equitable exceptions have no place in determining whether a claim for relief has been timely asserted in the first instance.
Slip op. at 10-12 (emphasis added).
The opinion then holds that in this particular case, the complaint adequately pleaded "a recurring unfair act," which was sufficient to support application of the continuous accrual doctrine. Accordingly, the trial court erred in sustaining the defendant's demurrer without leave to amend. Id. at 14-20.
In theory, the Court could have considered only the continuous accrual doctrine, held that it applied to UCL cases (including this case), and left the other doctrines for another day. It did not, perhaps because the rationale for its decision would be identical for all the doctrines. The approach also promotes judicial economy by resolving the split in authority among the lower courts, which revolved around the delayed discovery rule in particular.

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