Court Opinion

ID: 9409285
Source: CourtListenerOpinion
Date Created: 2023-07-17 17:04:43.466569+00
Date Added: 2024-06-11T17:20:49.116934
License: Public Domain

IN THE SUPREME COURT OF
               CALIFORNIA

          CALIFORNIA MEDICAL ASSOCIATION,
                 Plaintiff and Appellant,
                           v.
          AETNA HEALTH OF CALIFORNIA INC.,
               Defendant and Respondent.

                          S269212

          Second Appellate District, Division Eight
                         B304217

             Los Angeles County Superior Court
                         BC487412

                        July 17, 2023

Justice Evans authored the opinion of the Court, in which
Chief Justice Guerrero and Justices Corrigan, Liu, Kruger,
Groban, and Jenkins concurred.
CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH
              OF CALIFORNIA INC.
                             S269212

                Opinion of the Court by Evans, J.

      The California Medical Association, a professional
association representing California physicians, has sued a
health insurance company, alleging the company violated the
unfair competition law (UCL; Bus. & Prof. Code, § 17200 et seq.)
by engaging in unlawful business practices. The UCL confers
standing on a private plaintiff to seek relief under the statute
only if that plaintiff has “suffered injury in fact” and “lost money
or property as a result of the unfair competition” at issue. (Bus.
& Prof. Code, § 17204.)1 This case presents the question
whether an organization can satisfy these two related standing
requirements by diverting its own resources to combat allegedly
unfair competition.
    The issue arises here because, under the UCL as it was
amended in 2004 by Proposition 64, a membership organization
such as the California Medical Association may not base
standing to sue on injuries to its members, but only on those to
the organization itself. (Amalgamated Transit Union, Local
1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th 993, 1003–
1004 (Amalgamated Transit).) And, while an organization
would clearly have standing under the UCL if it were, for
example, fraudulently induced to buy a product from a deceptive

1
     Unless otherwise specified, statutory references are to the
Business and Professions Code.

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                  Opinion of the Court by Evans, J.

seller (see § 17201 [broadly defining “person[s]” who can sue
under the UCL]), this case presents us with a more difficult
question: whether resources that an organization has spent to
counter an unfair or unlawful practice constitute “money or
property” that has been “lost . . . as a result of the unfair
competition.” (§ 17204.)
     We hold that the UCL’s standing requirements are
satisfied when an organization, in furtherance of a bona fide,
preexisting mission, incurs costs to respond to perceived unfair
competition that threatens that mission, so long as those
expenditures are independent of costs incurred in UCL
litigation or preparations for such litigation.       When an
organization has incurred such expenditures, it has “suffered
injury in fact” and “lost money or property as a result of the
unfair competition.” (§ 17204.) In this case, which arises on
appeal from summary judgment for the defense, the record
discloses a triable issue of fact as to whether the plaintiff
association expended resources in response to the perceived
threat the health insurer’s allegedly unlawful practices posed to
plaintiff’s mission of supporting its member physicians and
advancing public health. The evidence was also sufficient to
create a triable issue of fact as to whether those expenses were
incurred independent of this litigation. For these reasons, the
trial court erred in granting summary judgment for the defense.
We therefore reverse the judgment of the Court of Appeal, which
affirmed the grant of summary judgment.
        I. FACTUAL AND PROCEDURAL BACKGROUND
    Defendant Aetna Health of California Inc. (Aetna) provides
health insurance. For its preferred provider plans, Aetna
contracts with a network of physicians and other medical

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                  Opinion of the Court by Evans, J.

providers who offer care to insured individuals at an agreed
rate. Member patients can also see providers outside the
network on referral from in-network physicians, but may bear a
greater share of the cost. Effective in 2009, Aetna adopted a
“Network Intervention Policy” designed, according to its terms,
to “reduce the number of non par [i.e., nonparticipating, or
out-of-network] referrals by par providers and if necessary take
further action against participating providers who refuse, after
warning and education to comply with the terms of their
contract.” (See California Medical Assn. v. Aetna Health of
California Inc. (2021) 63 Cal.App.5th 660, 662–664 (California
Medical).)2
     The California Medical Association (CMA) is a nonprofit
professional organization, founded in 1856, that advocates on
behalf of California physicians. By CMA’s count, it has more
than 37,000 physician members. CMA’s established mission,
which it carries out through “ ‘legislative, legal, regulatory,
economic, and social advocacy’ ” (California Medical, supra, 63
Cal.App.5th at p. 664), includes “the protection of the public
health and the betterment of the medical profession.” According
to its vice-president and general counsel, CMA “has been
especially active in advocacy and education on issues involving
health insurance companies’ interference with the sound
medical judgment of physicians providing care to enrollees.”

2
      We have drawn some factual background (unchallenged
by either party through a petition for rehearing) from the
opinion of the Court of Appeal below. (See Cal. Rules of Court,
rule 8.500(c)(2).)

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                    Opinion of the Court by Evans, J.

     In 2010, at least two years before it filed suit, CMA learned
of Aetna’s Network Intervention Policy from its members and
became concerned that in threatening termination or actually
terminating participating physicians for their referrals to
out-of-network providers, the policy’s implementation interfered
with physicians’ exercise of their sound medical judgment.
Aetna maintains that its policy, rather than interfering in
medical judgments, was designed simply to encourage
participating physicians, consistent with their judgment, to use
in-network care providers, such as ambulatory surgery centers,
and was adopted in part in response to physicians referring
patients to facilities in which they had financial interests. The
merits of the parties’ dispute are not before us, and we express
no views on them.
       CMA’s general counsel estimated that the organization
diverted 200–250 hours of staff time to respond to the policy.
That time was spent on activities including: (i) “investigat[ion]”
for the purpose of “advis[ing] physicians and the public
regarding how to address Aetna’s . . . interference with the
physician-patient relationship in an effort to avoid litigation
over this issue”; (ii) “prepar[ing] a 3-page document entitled the
‘Aetna Termination Resource Guide,’ which [CMA] publicized,
advising . . . members about Aetna’s new policy . . . , including
ways to proactively address and counteract Aetna’s policies”;
(iii) engaging with physicians affected by Aetna’s policy and
interacting with Aetna on physicians’ behalf; and
(iv) “prepar[ing] a letter to California’s Department of Insurance
and California’s Department of Managed Health Care
requesting that they take action to address” Aetna’s change in
policy. According to the general counsel, at least some of this

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                  Opinion of the Court by Evans, J.

diverted time “would otherwise have been devoted to serving
[CMA’s] membership” in other respects.
     In July 2012, CMA sued Aetna, alleging Aetna’s
implementation of the Network Intervention Policy violated the
UCL both because it was unfairly oppressive and injurious and
because it violated specified sections of the Insurance Code,
Business and Professions Code, and Health and Safety Code.
CMA sought to enjoin Aetna from enforcing the policy. Aetna
moved for summary judgment. It argued that CMA lacked UCL
standing because CMA had not lost money or property as a
result of the policy. Aetna emphasized that the policy applied to
individual physicians — not to CMA. CMA countered that it
had diverted resources in response to the policy.
      The trial court granted Aetna’s motion for summary
judgment on standing grounds. Relying on Amalgamated
Transit, supra, 46 Cal.4th 993, the court concluded that an
organization’s diversion of resources is not “sufficient to
establish standing under the UCL.” CMA appealed.
     The Court of Appeal affirmed. (California Medical, supra,
63 Cal.App.5th 660.) First, the court held that CMA could seek
an injunction against Aetna only if CMA had individually
suffered injury in fact and lost money or property; injury to
CMA’s members did not suffice. That conclusion is not disputed
here. Second, the court addressed whether CMA’s evidence that
it diverted substantial resources to investigate and oppose
Aetna’s actions showed that CMA itself suffered injury in fact
and lost money or property. (Id. at p. 667.) The court held that
the evidence did not create a material dispute of fact on this
point, because CMA had merely expended resources for its
members’ benefit: CMA “was founded to advocate on behalf of

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                   Opinion of the Court by Evans, J.

its physician members. The staff time spent here in response to
Aetna’s termination and threats to terminate physicians was
typical of the support CMA provides its members in furtherance
of CMA’s mission.” (Id. at p. 668.) If CMA’s expenditure of
resources in this manner sufficed to establish standing, the
appellate court reasoned, “then any organization acting
consistently with its mission to help its members through
legislative, legal and regulatory advocacy could claim standing
based on its efforts to address its members’ injuries. The 2004
amendments to the UCL eliminated such representational
standing.” (California Medical, at p. 668.)
      We granted CMA’s petition for review.
                         II. DISCUSSION
      Sections 17200 to 17210 of the Business and Professions
Code contain what we now refer to as the unfair competition
law. (Stop Youth Addiction, Inc., v. Lucky Stores, Inc. (1998) 17
Cal.4th 553, 558, fn. 2 (Stop Youth Addiction); see id. at pp. 569–
570 [history of UCL].) The law’s “purpose ‘is to protect both
consumers and competitors by promoting fair competition in
commercial markets for goods and services.’ ” (McGill v.
Citibank, N.A. (2017) 2 Cal.5th 945, 954 (McGill).) To that end,
the UCL takes aim at “unfair competition,” a term it defines to
“include any unlawful, unfair or fraudulent business act or
practice.” (§ 17200.) The phrase “any unlawful . . . business act
or practice” (ibid.) in effect “ ‘ “borrows” ’ rules set out in other
laws and makes violations of those rules independently
actionable.” (Zhang v. Superior Court (2013) 57 Cal.4th 364,
370.) The text of section 17200 also “makes clear that a practice
may be deemed unfair even if not specifically proscribed by some

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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other law.”   (Cel-Tech Communications, Inc. v. Los Angeles
Cellular Telephone Co. (1999) 20 Cal.4th 163, 180.)
       The UCL’s broad reach contrasts with the somewhat
limited scope of the remedies that the statutory scheme creates.
The UCL affords private plaintiffs the ability to seek injunctive
relief and restitution in response to unfair conduct. (§ 17203;
see also Clayworth v. Pfizer, Inc. (2010) 49 Cal.4th 758, 790
(Clayworth).) But the UCL does not itself authorize an award
of damages or attorney’s fees. (Zhang v. Superior Court, supra,
57 Cal.4th at p. 371.) It approves awards of civil penalties only
in actions brought by specified governmental plaintiffs.
(§ 17206; State of California v. Altus Finance (2005) 36 Cal.4th
1284, 1307.) These limited remedies are not exclusive, however;
they “are cumulative to each other and to the remedies or
penalties available under all other laws of this state.” (§ 17205.)
      This case concerns the circumstances in which a private
organization may seek injunctive relief under the UCL. In the
past, “any person acting for the interests of itself, its members
or the general public” could bring a UCL action — even if that
person had not been injured by the business act or practice at
issue. (Former § 17204; see Stop Youth Addiction, supra, 17
Cal.4th at pp. 561, 567.) Some in the legal and business
communities were concerned that this broad authority to sue
allowed attorneys “to file frivolous lawsuits against small
businesses even though they ha[d] no client or evidence that
anyone was damaged or misled.” (Voter Information Guide,
Gen. Elec. (Nov. 2, 2004) argument in favor of Prop. 64, p. 40;
see In re Tobacco II Cases (2009) 46 Cal.4th 298, 316–317
(Tobacco II Cases); Angelucci v. Century Supper Club (2007) 41
Cal.4th 160, 178, fn. 10.) In response, the electorate approved

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     CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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                    Opinion of the Court by Evans, J.

Proposition 64, a 2004 initiative measure.              (Californians for
Disability Rights v. Mervyn’s, LLC (2006) 39 Cal.4th 223, 228–
229 (Mervyn’s); see Voter Information Guide, Gen. Elec., supra,
text of Prop. 64, § 1, p. 109 [findings and declarations of
purpose].)
      Proposition 64 limited the set of eligible private UCL
plaintiffs to those persons who have “suffered injury in fact” and
“lost money or property as a result of” the business act or
practice at issue. (Voter Information Guide, Gen. Elec., supra,
text of Prop. 64, § 3, p. 109; § 17204.) The “injury in fact”
requirement is borrowed from federal constitutional law and
overlaps to a considerable degree with the “lost money or
property” inquiry. (§ 17204; see Kwikset Corp. v. Superior Court
(2011) 51 Cal.4th 310, 322–323 & fn. 5 (Kwikset).) The core
inquiry is whether the plaintiff has suffered “economic
injury . . . caused by . . . the unfair . . . practice . . . that is the
gravamen of the claim.” (Id. at p. 322.)
      Whether CMA has standing to bring a claim under the
UCL requires us to answer two questions of statutory
interpretation.3 The first is whether diversion of staff time can
qualify as an “injury in fact” and loss of “money or property”
within the meaning of section 17204. The second is whether an
organization that chose to divert staff time to counteract the
defendant’s business practice can be said to have lost that staff
time “as a result of” (ibid.) that practice. We review these

3
      That CMA is not a natural person does not matter for
standing purposes. Section 17201 defines “person,” as used in
the UCL’s enforcement provisions, to include “associations and
other organizations of persons.”

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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interpretive questions de novo, beginning by examining the
statutory language to determine the voters’ intent. We construe
that language in its full statutory context, keeping in mind the
nature and purposes of the statutory scheme as a whole. (People
v. Lewis (2021) 11 Cal.5th 952, 961; Kwikset, supra, 51 Cal.4th
at p. 321.) To the extent there are ambiguities in the initiative’s
language affecting its application to the case, we turn to
“extrinsic sources such as ballot summaries and arguments for
insight into the voters’ intent.” (Kwikset, at p. 321.)
      Whether the trial court erred by granting Aetna’s motion
for summary judgment is likewise subject to de novo review, and
like the trial court ruling on the motion, we must view the
evidence in the light most favorable to CMA and draw all
reasonable inferences in CMA’s favor. (Weiss v. People ex rel.
Department of Transportation (2020) 9 Cal.5th 840, 864;
Samara v. Matar (2018) 5 Cal.5th 322, 338.)
     A. Economic Injury
      A private plaintiff has UCL standing only if that plaintiff
“has suffered injury in fact and has lost money or property.”
(§ 17204.) Because loss of money or property is a subset of injury
in fact, proof of harm to money or property will generally satisfy
the injury-in-fact requirement. (See Kwikset, supra, 51 Cal.4th
at pp. 323, 325.)
     The phrase “injury in fact” is borrowed from, and was
intended to incorporate aspects of, the federal constitutional law
of standing. (See Voter Information Guide, Gen. Elec., supra,
text of Prop. 64, § 1, subd. (e), p. 109 [declaring intent to limit
standing to plaintiffs who have been “injured in fact under the
standing requirements of the United States Constitution”].) To
establish a case or controversy within the scope of the federal

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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judicial power (U.S. Const., art. III, § 2), a plaintiff in federal
court “must show (1) an injury in fact, (2) fairly traceable to the
challenged conduct of the defendant, (3) that is likely to be
redressed by the requested relief.”            (Federal Election
Commission v. Cruz (2022) __ U.S. __ [142 S.Ct. 1638, 1646].)
Proposition 64 incorporated the injury-in-fact requirement into
the UCL (Kwikset, supra, 51 Cal.4th at pp. 322–323) but did not
borrow the traceability or redressability requirements of the
federal standing inquiry.4 To show an injury in fact, a plaintiff
must identify “ ‘an invasion of a legally protected interest which
is (a) concrete and particularized, [citations]; and (b) “actual or
imminent, not ‘conjectural’ or ‘hypothetical.’ ” ’ ” (Kwikset, at
p. 322.)
      The UCL’s focus on “los[s]” of “money or property”
(§ 17204) restricts the broad range of harms that could
otherwise give rise to standing. As a matter of federal law, an
injury can be concrete — i.e., “ ‘real,’ and not ‘abstract’ ” — even
if the injury is personal instead of economic; even certain
intangible injuries qualify as injury in fact. (Spokeo, Inc. v.
Robins (2016) 578 U.S. 330, 340; accord, TransUnion LLC v.
Ramirez (2021) __ U.S. __ [141 S.Ct. 2190, 2204]; Kwikset,
supra, 51 Cal.4th at p. 324, fn. 6.) Under the UCL, however,
only injuries to money or property — that is, only economic
injuries — can support standing. (Kwikset, at p. 324.)

4
      In place of the federal traceability requirement,
Proposition 64 included its own causation element for standing:
that the injury was incurred “as a result of” the challenged
business practice. (§ 17204.) We discuss that element in the
next section.

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                   Opinion of the Court by Evans, J.

      Beyond this limitation to economic injuries, section
17204’s reference to “money or property” does not otherwise
define or limit the injury-in-fact inquiry. (Kwikset, supra, 51
Cal.4th at pp. 323–325.) A showing of economic injury requires
only that the plaintiff allege or prove “a personal, individualized
loss of money or property in any nontrivial amount.” (Id. at p.
325.) Moreover, because the issue is one of standing, rather
than the amount of restitution due, “a specific measure of the
amount of this loss is not required. It suffices that a plaintiff
can allege an ‘ “identifiable trifle” ’ [citation] of economic
injury.” (Id. at p. 330, fn. 15.)
     As we explained in Kwikset, “[t]here are innumerable
ways in which economic injury from unfair competition may be
shown. A plaintiff may (1) surrender in a transaction more, or
acquire in a transaction less, than he or she otherwise would
have; (2) have a present or future property interest diminished;
(3) be deprived of money or property to which he or she has a
cognizable claim; or (4) be required to enter into a transaction,
costing money or property, that would otherwise have been
unnecessary. [Citation.] Neither the text of Proposition 64 nor
the ballot arguments in support of it purport to define or limit
the concept of ‘lost money or property,’ nor can or need we supply
an exhaustive list of the ways in which unfair competition may
cause economic harm.” (Kwikset, supra, 51 Cal.4th at p. 323.)
      CMA contends it suffered an economic injury through the
diversion of personnel and other resources to respond to Aetna’s
Network Intervention Policy, resources that would otherwise
have been deployed to assist CMA’s members in other ways.
Consistent with our observation in Kwikset that Proposition 64
did not “purport to define or limit” what constitutes lost money

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    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
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or property (Kwikset, supra, 51 Cal.4th at p. 323), we conclude
that diversion of salaried staff time and other office resources
can constitute the loss of “money or property” within the
meaning of section 17204. Every organization, including CMA,
has finite resources to devote to its mission. If the organization
uses staff time for a particular project, for example, it must
either pull those hours from a different project or augment its
staff. Even if, as here, the personnel involved are paid on a
salaried basis rather than by the hour, their time clearly holds
economic value to the organization. When staff are diverted to
a new project undertaken in response to an unfair business
practice, the organization loses the value of their time, which
otherwise would have been used to benefit the organization in
other ways. (Cf. Convoy Co. v. Sperry Rand Corp. (9th Cir. 1982)
672 F.2d 781, 785–786 [plaintiff in breach of contract case can
recover cost of salaried staff time spent supervising defective
computer system]; VMark Software, Inc. v. EMC Corp. (1994) 37
Mass.App.Ct. 610, 620 [642 N.E.2d. 587, 594] [damages in
misrepresentation case “should have included the costs of the
hours fruitlessly spent by EMC employees trying to make the
defective computer system work”].)
      While the exact question of UCL standing presented here
is one of first impression in this court, it has been addressed by
other courts applying California law, and closely analogous
questions of federal standing have been addressed by the federal
courts. Before turning to those decisions, though, we observe
that CMA’s theory of economic injury is consistent with how we
have understood this element of UCL standing. In Kwikset, we
held that consumers who purchased locksets in reliance on an
allegedly false “ ‘Made in U.S.A.’ ” label (Kwikset, supra, 51

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Cal.4th at p. 316) “ha[d] ‘lost money or property’ within the
meaning of Proposition 64” (id. at p. 317), even though the
products were not objectively defective and the plaintiffs, “while
they had spent money, [had] ‘received locksets in return’ ” (id.
at p. 331). Consumers deceived in this manner, we explained,
suffered economic injuries when they purchased products they
would not have bought, at least at that price, had the products
been accurately labeled. (Id. at pp. 329–330.) Kwikset relied in
part on our earlier decision in Clayworth, supra, 49 Cal.4th at
pages 788–789, where we held that the plaintiff pharmacies’
ability to pass drug manufacturers’ allegedly illegal overcharges
on to consumers did not defeat their standing under the UCL,
because they suffered an economic injury when they paid the
manufacturers’ inflated prices. (Kwikset, at p. 334.)
       Our cases thus teach that economic injury for purposes of
UCL standing, even after Proposition 64, is not limited to
out-of-pocket expenditures for which no value has been received,
or to objectively determined overpayments. In that respect, the
facts here can be seen as loosely analogous to those in Kwikset
and Clayworth. CMA may not have incurred additional
out-of-pocket costs in responding to Aetna’s allegedly illegal
practices; its employees were salaried and would have been paid
regardless. But the economic value CMA received from their
labor was reduced. CMA “lost money or property” (§ 17204)
when its personnel were diverted from other activities that
would also have served its goal of assisting its physician
members.      In Kwikset’s terms, CMA “enter[ed] into a
transaction, costing money or property, that would otherwise
have been unnecessary,” as its staff was diverted from what the
organization regarded as useful projects to respond to Aetna’s

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allegedly unfair business practices. (Kwikset, supra, 51 Cal.4th
at p. 323.) That injury suffices for standing purposes.
      On facts closer to those shown here, courts have agreed
that UCL standing can be based on an organization’s diversion
of resources in response to a threat to its mission. In Animal
Legal Defense Fund v. LT Napa Partners LLC (2015) 234
Cal.App.4th 1270 (Animal Legal Defense), the plaintiff
organization had advocated for a California ban on the sale of
foie gras and was active in informing the public about the law
once enacted. (Id. at p. 1280.) On discovering that the
defendant’s restaurant was continuing to serve foie gras, the
organization diverted staff time and resources from other
projects to complete an investigation of the restaurant, share its
findings with local law enforcement authorities, and try to
persuade those authorities to enforce the ban against the
defendant. (Ibid.) The Court of Appeal concluded the plaintiff’s
diversion of resources constituted economic injury as Kwikset
had explained that UCL standing requirement: in response to
the defendant’s allegedly illegal sales, the organization had
“ ‘enter[ed] into a transaction, costing money or property, that
would otherwise have been unnecessary.’ ” (Animal Legal
Defense, at p. 1280, quoting Kwikset, supra, 51 Cal.4th at
p. 323.)5

5
      Among the organization’s steps in Animal Legal Defense
was hiring a private investigator to dine at the restaurant and
request foie gras.      (Animal Legal Defense, supra, 234
Cal.App.4th at p. 1275.) The Court of Appeal’s decision,
however, does not emphasize that outside expenditure as
establishing loss of money or property; it places at least equal

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                   Opinion of the Court by Evans, J.

       Similarly, in Southern California Housing Rights Center
v. Los Feliz Towers Homeowners Ass’n (C.D.Cal. 2005) 426
F.Supp.2d 1061 (Southern California Housing), a condominium
owner and a housing rights organization sued a homeowners’
association for failing to provide the owner with an accessible
parking space as a reasonable accommodation for her disability.
(Id. at p. 1063.) In a brief analysis, the federal district court
concluded the organization had standing under the UCL, even
after Proposition 64, because it had presented “evidence of
actual injury based on loss of financial resources in investigating
this claim and diversion of staff time from other cases to
investigate the allegations here.” (Id. at p. 1069; accord, In re
WellPoint, Inc. Out-of-Network UCR Rates Litigation (C.D.Cal.
2012) 903 F.Supp.2d 880, 900 [relying on Southern California
Housing in declining to dismiss plaintiff associations’ claims of
organizational injury].)
       A California appellate court later cited Southern
California Housing as one of several examples of how
“expend[ing] money due to the defendant’s acts of unfair
competition” could establish economic injury, describing the
federal case with the parenthetical explanation, “housing rights
center lost financial resources and diverted staff time
investigating case against defendants.”         (Hall v. Time
Inc. (2008) 158 Cal.App.4th 847, 854.) This court, in turn, later
cited that passage from Hall as “cataloguing some of the various
forms of economic injury.” (Kwikset, supra, 51 Cal.4th at p. 323.)

stress on the evidence the organization’s own staff “spent
months on the effort to persuade Napa authorities to take action
based on the alleged violations.” (Id. at p. 1282.)

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While Kwikset did not specifically endorse the decision in
Southern California Housing, our approving citation of Hall’s
catalogue, which included the citation to Southern California
Housing and described its diversion-of-resources reasoning,
indicates at the least that the diversion theory of standing is not
facially inconsistent with Kwikset’s understanding of the UCL
after Proposition 64.
      The Court of Appeal below considered Animal Legal
Defense distinguishable on the ground that the plaintiff
organization in that case, unlike CMA here, “was not advocating
on behalf of or providing services to help its members deal with
their loss of money or property.” (California Medical, supra, 63
Cal.App.5th at p. 668.) Because CMA’s expenditures benefited
its physician members who were threatened by Aetna’s policy,
the lower court reasoned, CMA’s suit is in reality a
representative one. (Ibid.) Aetna makes the same argument.
      We find the lower court’s reasoning unpersuasive for at
least two reasons. First and most fundamentally, the court’s
opinion appears to conflate CMA’s own claimed injury, its
expenditure of resources responding to Aetna’s policy, with the
injuries to the member physicians affected by that policy. The
two injuries are conceptually distinct, even if CMA acted in part
to prevent further injury to its members. Relatedly, the Court
of Appeal appears to have confused associational standing,
under which an association “may bring an action on behalf of its
members when the association itself would not otherwise have
standing” (Amalgamated Transit, supra, 46 Cal.4th at p. 1004),
with organizational standing, in which the organization asserts
its own claims based on its own injuries.

                                  16
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

      For the same reason, we are not persuaded that, as Aetna
maintains, CMA’s standing theory is foreclosed by our decision
in Amalgamated Transit. The plaintiff unions in that case,
unlike CMA, made no claim to injuries distinct from those to
their members, instead seeking standing only as assignees and
representatives of the injured union members. (Amalgamated
Transit, supra, 46 Cal.4th at pp. 998–999.) Here, in contrast,
CMA’s standing theory — organizational rather than
associational standing — is based on its own claim of economic
injury.
     Second, the perceived threat to CMA’s mission went
beyond injury to physician members of CMA. By imposing
unwarranted restrictions on network physicians’ medical
referrals, in CMA’s view, Aetna’s policy impaired CMA’s efforts
to protect the public health. Whether or not the plaintiff
organization in Animal Legal Defense had members who were
affected by the alleged unlawful practices, the organization
could claim injury in its diversion of limited resources to respond
to a threat to its own mission, a claim that may equally be made
by a membership organization like CMA.
      The Court of Appeal’s discussion of this point is also
unclear as to its bearing on the standing question. Proposition
64’s amendments to the UCL did not eliminate representative
actions. In section 17204, the measure requires that all private
plaintiffs have suffered an economic injury; in section 17203, it
mandates that private plaintiffs bringing representative actions
comply with class actions procedures and requirements
developed under Code of Civil Procedure section 382. (See Arias
v. Superior Court (2009) 46 Cal.4th 969, 977–980.) Even if
CMA’s suit were considered a representative one, then, the

                                  17
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                    Opinion of the Court by Evans, J.

organization could still claim standing based on its own
economic injury.6
     Both Animal Legal Defense and Southern California
Housing relied on a line of federal decisions, beginning with
Havens Realty Corp. v. Coleman (1982) 455 U.S. 363 (Havens),

6
       As we explained in McGill, supra, 2 Cal.5th at pages 959–
960, a party with individual standing to sue under section 17204
may do so even if the complaint seeks injunctive relief that
primarily benefits the public, and such a request for relief does
not make the action a representative one under section 17203 or
require compliance with Code of Civil Procedure section 382.
       In its brief, CMA maintains that it seeks injunctive relief
that would primarily benefit the public rather than CMA’s
membership and that the action therefore should not be deemed
representative for purposes of section 17203. Aetna, on the
other hand, argues that the action is subject to section 17203,
and CMA should have to comply with Code of Civil Procedure
section 382, because the organization’s request for injunctive
relief primarily seeks to further the interests of its physician
members.
       We need not resolve this dispute, nor need we address the
underlying premise that section 17203 might apply to some
claims of injunctive relief and not others. (Cf. McGill, at pp.
960–961 [distinguishing a claim for public injunctive relief from
a claim seeking “ ‘disgorgement and/or restitution on behalf of
persons other than or in addition to the plaintiff’ ”].) The
question of section 17203’s application, and whether compliance
with Code of Civil Procedure section 382 is required here, is
separate from the question of standing under section 17204 —
the sole ground on which summary judgment against CMA was
rendered and affirmed. The Court of Appeal did not address
section 17203’s requirement of compliance with Code of Civil
Procedure section 382, but focused throughout on standing
under section 17204. We therefore need not decide in this case
whether CMA’s action is subject to section 17203, and we
express no opinion on that point.

                                   18
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

holding that an organization may establish injury in fact by
showing that it diverted resources in response to a threat to its
mission. (See Animal Legal Defense, supra, 234 Cal.App.4th at
pp. 1281–1282; Southern California Housing, supra, 426
F.Supp.2d at p. 1069.) CMA, as well, relies on Havens and its
progeny for its standing theory here, while Aetna maintains
that the narrower standing limits of the UCL after Proposition
64 make the federal cases inapposite. On reviewing the federal
decisions, we find them to be persuasive authority for CMA’s
theory of UCL standing.
      In Havens, a nonprofit corporation devoted to increasing
equal housing opportunities in the Richmond, Virginia area
joined individuals who had allegedly suffered from a building
owner’s racial steering practices in suing the owner under the
federal Fair Housing Act of 1968 (Havens, supra, 455 U.S. at pp.
366–368), alleging the defendant’s practices had frustrated the
organization’s mission and caused it “ ‘to devote significant
resources to identify and counteract the defendant’s [sic] racially
discriminatory steering practices.’ ” (Id. at p. 379.) The high
court held the organization’s allegations satisfied the federal
Constitution’s injury-in-fact requirement, reasoning that “[i]f,
as broadly alleged, petitioners’ steering practices have
perceptibly impaired HOME’s ability to provide counseling and
referral services for low- and moderate-income homeseekers,
there can be no question that the organization has suffered
injury in fact. Such concrete and demonstrable injury to the
organization’s activities — with the consequent drain on the
organization’s resources — constitutes far more than simply a
setback to the organization’s abstract social interests . . . .”
(Ibid.) In a footnote, the court added: “That the alleged injury

                                  19
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

results from the organization’s noneconomic interest in
encouraging open housing does not affect the nature of the
injury suffered [citation], and accordingly does not deprive the
organization of standing.” (Id. at p. 379, fn. 20.)
     Federal courts have applied the reasoning of Havens in
numerous cases, finding that organizations with a variety of
missions have suffered injury in fact through the diversion of
their resources. (See, e.g., Nnebe v. Daus (2d Cir. 2011) 644 F.3d
147, 156–157 [taxi drivers’ alliance may base standing to sue
regulatory agency on expenditure of resources in counseling and
assisting drivers threatened with summary suspension];
Heights Community Congress v. Hilltop Realty, Inc. (6th Cir.
1985) 774 F.2d 135, 139 & fn. 2 [fair housing organization had
standing to sue over racial steering]; Crawford v. Marion County
Election Bd. (7th Cir. 2007) 472 F.3d 949, 951 [Democratic Party
has standing to challenge voter identification law because the
law causes the party “to devote resources to getting to the polls
those of its supporters who would otherwise be discouraged by
the new law from bothering to vote”]; Fair Housing Council of
San Fernando Valley v. Roommate.com, LLC (9th Cir. 2012) 666
F.3d 1216, 1219 [fair housing organizations had standing to sue
over allegedly illegal roommate referral practices because the
defendant’s conduct “caused [them] to divert resources
independent of litigation costs and frustrated their central
mission”]; El Rescate Legal Services, Inc. v. Executive Office of
Immigration Review (9th Cir. 1991) 959 F.2d 742, 748
[organizations assisting immigrant refugees established
standing by alleging that federal agency’s translation policy
“frustrates [their] goals and requires the organizations to
expend resources in representing clients they otherwise would

                                 20
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

spend in other ways”]; Fort Lauderdale Food Not Bombs v. City
of Fort Lauderdale (11th Cir. 2021) 11 F.4th 1266, 1287
[organization serving food to homeless had standing to sue city
over city’s restrictions on food-sharing activities because, among
other effects, “volunteers who would have normally worked on
preparing for food-sharing demonstrations had to divert their
energies to advocacy activities such as attending City meetings
and organizing protests against the Ordinance”]; Spann v.
Colonial Village, Inc. (D.C. Cir. 1990) 899 F.2d 24, 27 [fair
housing organizations had standing to sue over racially biased
advertising because the allegedly illegal practices caused them
to “devote resources to checking or neutralizing the ads’ adverse
impact”]; see also Pacific Legal Foundation v. Goyan (4th Cir.
1981) 664 F.2d 1221 [adopting diversion-of-resources theory
prior to Havens].)
      The Havens court did not characterize the alleged injury
it found sufficient for organizational standing as economic or
noneconomic; unlike UCL standing, federal constitutional
standing does not turn on that distinction. Indeed, the high
court’s opinion left it somewhat uncertain whether the injury
that mattered was the “impair[ment to] HOME’s ability to
provide counseling and referral services for low- and moderate-
income homeseekers,” the “consequent drain on the
organization’s resources,” or both. (Havens, supra, 455 U.S. at
p. 379.) The footnoted statement that the alleged injury “results
from the organization’s noneconomic interest in encouraging
open housing” (id. at p. 379, fn. 20) does not imply that the injury
itself is noneconomic:         both the “impair[ment]” of the
organization’s activities (id. at p. 379), seemingly a noneconomic
harm, and the “consequent drain on the organization’s

                                  21
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

resources” (ibid.), seemingly an economic one, could be said to
result from the organization’s interest in promoting equal
housing opportunities.
      Some of Havens’s progeny, however, have more clearly
identified the injury that establishes standing under the
diversion-of-resources theory as an economic one. In Fair
Housing of Marin v. Combs (9th Cir. 2002) 285 F.3d 899, 905,
for example, the court held a fair housing organization suing a
property owner for racial discrimination “has direct standing to
sue because it showed a drain on its resources from both a
diversion of its resources and frustration of its mission.” The
appellate court noted that the district court had, in fact,
awarded more than $16,000 in diversion-of-resources damages
to compensate the organization for its “ ‘economic losses’ ” in
staff pay and other “ ‘funds expended.’ ” (Ibid.; see also Heights
Community Congress v. Hilltop Realty, Inc., supra, 774 F.2d at
p. 139, fn. 2 [characterizing housing organization’s expenditures
for monitoring real estate practices as an “economic injury”].) In
Nnebe v. Daus, supra, 644 F.3d at page 157, the court recognized
that the taxi drivers’ alliance had incurred an “opportunity cost”
when its resources were diverted to counseling drivers on the
city’s suspension policy and held that this showing of “economic
effect” sufficed to establish injury in fact. And in Crawford v.
Marion County Election Bd., supra, 472 F.3d at page 951, it was
the “added cost” that the Democratic Party incurred getting
voters to the polls that established the party’s standing. As
these courts have understood it, at least, the crucial injury in a
diversion-of-resources case is clearly an economic one.
     Like the courts in Animal Legal Defense and Southern
California Housing, therefore, we find the Havens line of federal

                                 22
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

decisions persuasive authority for a rule that an organization’s
diversion of resources can establish “injury in fact” and “lost
money or property” for purposes of section 17204. As explained
earlier, the voters in Proposition 64 intended to adopt the injury-
in-fact requirement from federal standing law. The added
reference to “lost money or property” does no more than limit
the cognizable injuries to economic ones. (Kwikset, supra, 51
Cal.4th at p. 325.) As Havens and its progeny make clear, an
organization that has expended staff time or other resources on
responding to a new threat to its mission, diverting those
resources from other projects, has suffered an economic injury
in fact.7
      Relying on the rule that a party opposing summary
judgment cannot create an issue of fact by a declaration that
contradicts the party’s prior discovery responses (Shin v.
Ahn (2007) 42 Cal.4th 482, 500, fn. 12), Aetna argues that the
declaration by CMA’s general counsel estimating that the
organization diverted 200–250 hours of staff time to respond to

7
      Aetna cites In re Sony Gaming Networks and Customer
Data Sec. Breach Litigation (S.D.Cal. 2012) 903 F.Supp.2d 942,
966, along with two unreported district court rulings, for the
proposition that loss of time is not an economic loss for purposes
of UCL standing. But the plaintiff in each of these cases was an
individual or a class of individuals who spent their personal,
uncompensated time responding to the alleged unfair
competition, not an organization alleging diversion of paid staff
time.    (See id. at p. 950; Knippling v. Saxon Mortg.,
Inc. (E.D.Cal., Mar. 22, 2012, No. 2:11-CV-03116-JAM) 2012 WL
1142355, p. *1; Ruiz v. Gap, Inc. (N.D.Cal., Feb. 3, 2009, No. 07-
5739 SC) 2009 WL 250481, p. *1.) Our discussion and holding
here are limited to organizational standing; we say nothing
about individual standing.

                                  23
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

Aetna’s policy must be disregarded because it contradicts prior
discovery responses, and that without that declaration there is
no evidence to show economic injury even under the
diversion-of-resources theory. The cited depositions, however,
show only that one CMA employee (testifying on this point only
in his individual capacity) was unaware of databases tracking
expenses “for responding to specific member inquiries” and that,
according to another employee (whom CMA had designated as
most qualified to answer), CMA “is working on trying to identify
the cost for resources expended to address the Aetna illegal
terminations. . . . [B]ut we don’t have that available today.”
(Aetna also cites its own response to one of CMA’s filings in
opposition to summary judgment, but that contains no
admissions by CMA.) The cited deposition testimony does not
contradict the general counsel’s later declaration estimating the
extent of CMA’s diverted staff time, and accordingly, there is no
barrier to our consideration of it.
     B. Causation
      A private plaintiff has UCL standing only if the plaintiff
lost money or property “as a result of” the practice at issue.
(§ 17204.) In Kwikset, we concluded this language imposed a
causation requirement on UCL standing: “ ‘The phrase “as a
result of” in its plain and ordinary sense means “caused by” and
requires a showing of a causal connection or reliance on the
alleged misrepresentation.’ ” (Kwikset, supra, 51 Cal.4th at
p. 326.) In a fraud case like Kwikset, reliance is key because
“ ‘reliance is the causal mechanism of fraud.’ ” (Ibid., quoting
Tobacco II Cases, supra, 46 Cal.4th at p. 326.) As in Tobacco II
Cases, also a fraud case, Kwikset limited its discussion of the
causation element to such cases, declining to opine on the

                                 24
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

contours of causation where the alleged unfair competition did
not lie in misrepresentation. (Kwikset, supra, 51 Cal.4th at p.
326, fn. 9; Tobacco II Cases, supra, 46 Cal.4th at p. 325, fn. 17.)
In the present case, of course, Aetna’s Network Intervention
Policy is attacked not as fraudulent but as violative of laws
protecting medical decisionmaking. Beyond establishing that
“as a result of” in section 17204 requires a causal connection
between the alleged unfair competition and the plaintiff’s
economic injury, therefore, our precedents are of limited use in
deciding how the statutory requirement is to be applied here.
      Aetna argues that section 17204 imposes a requirement of
proximate causation akin to that in tort law, and that this
requirement cannot be met here because CMA independently
chose to oppose Aetna’s policy. According to Aetna, “[a] plaintiff
who chooses to advocate against a practice with which it
happens to disagree, assuming it lost money at all when
advocating, did so because of that choice, not because of the
defendants’ alleged conduct. [CMA’s] ‘choice,’ in other words, is
an intervening cause that breaks any chain of causation.” CMA,
on the other hand, contends that section 17204 requires only
“but for” causation. And even if proximate causation were
required, CMA further maintains, to break the chain of
proximate causation an intervening cause must be of
independent origin, and here the opposite is true. CMA asserts
that its “dedication of resources to respond to actions that
frustrate its mission is not ‘of independent origin’ — the origin
of the diversion is the allegedly unlawful conduct.” Because
CMA’s diversion of resources was a foreseeable response to
Aetna’s implementation of its policy, CMA argues, it did not
break the chain of proximate causation.

                                  25
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

      There are reasons to doubt that section 17204 imports a
proximate cause requirement from the substantive law of
negligence into the test for UCL standing. Neither the text of
section 17204 nor our decisions in Kwikset and Tobacco II Cases,
which address reliance as the causative mechanism in
misrepresentation cases, contain language suggesting a
proximate causation test applies. The “unlawful, unfair or
fraudulent business act[s] or practice[s]” (§ 17200) at which the
UCL takes aim are not markedly similar to the conduct that can
give rise to a negligence action.
      Ultimately, however, we need not resolve the question
here. In any event, we agree with CMA’s alternative argument:
CMA’s decision to devote resources to responding to Aetna’s
Network Intervention Policy was not a supervening or
superseding cause under the law of proximate causation if it
were to apply.
     In a decision both parties cite, this court explained that a
supervening or superseding cause, one that breaks the chain of
proximate causation, is a “later cause of independent origin”
that was neither “foreseeable by the defendant” nor “caused
injury of a type which was foreseeable.” (Akins v. County of
Sonoma (1967) 67 Cal.2d 185, 199; accord, Ballard v.
Uribe (1986) 41 Cal.3d 564, 587; Bigbee v. Pacific Tel. & Tel.
Co. (1983) 34 Cal.3d 49, 56.) “ ‘[F]or an intervening act properly
to be considered a superseding cause, the act must have
produced “harm of a kind and degree so far beyond the risk the
original tortfeasor should have foreseen that the law deems it
unfair to hold him responsible.” ’ ” (Kahn v. East Side Union
High School Dist. (2003) 31 Cal.4th 990, 1017.)

                                 26
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

     The facts here do not involve any such independent and
unforeseeable conduct by CMA or any third party. Aetna
implemented     its  Network  Intervention   Policy   by
communications with physicians in its preferred provider
networks, in some cases threatening to terminate their network
participation. That some of those physicians would alert CMA,
the state’s most prominent physician association, was highly
foreseeable. That CMA would come to their assistance by
working to reverse or alter Aetna’s policy, attempting to prevent
its implementation in ways that impinged on its members’
medical practices, was equally foreseeable. CMA’s response to
Aetna’s policy, while voluntary, thus derived foreseeably from
Aetna’s conduct.     It was not the type of independent,
unforeseeable action that would preclude a finding of proximate
cause in a tort context. Even if section 17204 incorporated a
proximate cause requirement into its UCL standing test, that
requirement would be met.
      Aetna compares this case to Two Jinn, Inc. v. Government
Payment Service, Inc. (2015) 233 Cal.App.4th 1321, 1326 (Two
Jinn), in which a licensed bail agency sued an unlicensed
company for providing bail services in violation of the UCL. As
part of its argument for standing, the plaintiff averred it had
“suffered an economic injury by incurring ‘significant costs and
expenses’ to investigate the ‘nature, scope and extent of
Defendant’s conduct.’ ” (Id. at p. 1334.)8 The Court of Appeal

8
      The plaintiff also claimed injury from direct competition,
but the appellate court rejected that theory because the evidence
showed that “any diversion of potential customers from Aladdin
to GPS results from the Legislature’s establishment of the cash

                                 27
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

rejected that theory of standing on causation grounds: “These
‘pre-litigation’ costs do not establish standing to bring a UCL
claim because they are not an economic injury caused by the
business practices that Aladdin characterizes as unlawful.
Rather, . . . the reason Aladdin incurred prelitigation expenses
was to generate evidence. Aladdin then used that evidence to
support this lawsuit.” (Ibid.) Distinguishing Havens on its
facts, the court explained that “[h]ere, proof that Aladdin spent
money to investigate GPS’s activities would not show that those
allegedly unfair business activities had any independent
economic impact on Aladdin’s bail bond business. Beyond
that, Havens does not hold or intimate that a party can
manufacture an economic injury by incurring investigation costs
to generate evidence for its lawsuit.” (Id. at p. 1335.)
      Similarly in this case, Aetna argues, its Network
Intervention Policy did not affect CMA’s operations, since the
policy applied only to physicians. CMA should not be able to
rely on its expenditures opposing that policy for UCL standing,
any more than the bail agency in Two Jinn, which was not
directly injured by the defendant’s allegedly illegal conduct,
could rely on its investigative costs to establish an economic
injury for standing.
      CMA does not take issue with the propositions, reflected
in Two Jinn’s reasoning, that the diversion-of-resources theory
requires a threat to the plaintiff organization’s mission and that

bail payment system as an alternative to the traditional bail
bond service, and not from the fact that GPS conducts its
business without a bail agent license.” (Two Jinn, supra, 233
Cal.App.4th at p. 1332.)

                                  28
     CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                      CALIFORNIA INC.
                    Opinion of the Court by Evans, J.

expenditures made for UCL litigation itself cannot support UCL
standing. But, CMA argues, both requirements were met here.
Aetna’s policy, at least in the view of CMA, threatened
physicians’ medical independence and consequently the public
health, both objects of CMA’s protective mission. In response,
CMA undertook efforts to assist its members in dealing with
Aetna’s policy, to persuade Aetna to stop enforcing the policy,
and to spur regulatory action against the policy. These efforts
were independent of this litigation, which was commenced
approximately two years after CMA began responding to
Aetna’s policy.
      We agree with this analysis. As the Animal Legal Defense
court explained, in assessing causation under the diversion-of-
resources theory, “the proper focus is on whether the plaintiff
‘undertook the expenditures in response to, and to counteract,
the effects of the defendants’ alleged [misconduct] rather than
in anticipation of litigation.’ ” (Animal Legal Defense, supra, 234
Cal.App.4th at pp. 1283–1284.) Thus the plaintiff must show
that the defendant’s actions have posed a threat to the plaintiff
organization’s mission, causing it to devote resources to allay
the threat. (East Bay Sanctuary Covenant v. Biden (9th Cir.
2021) 993 F.3d 640, 663; Rodriguez v. City of San Jose (2019)
930 F.3d 1123, 1134 [“The organization cannot, however,
‘manufacture the injury by . . . simply choosing to spend money
fixing a problem that otherwise would not affect the
organization at all’ ”].)9

9
      Although the Proposition 64 voters did not borrow the
traceability requirement from federal standing law along with

                                   29
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

      Moreover, expenditures an organization makes in the
course of UCL litigation, or to prepare for such litigation, do not
serve, for purposes of UCL standing, to establish an injury in
fact resulting from the allegedly unfair competition. (Buckland
v. Threshold Enterprises, Ltd. (2007) 155 Cal.App.4th 798, 815.)
That parallels the rule adopted in several federal decisions
applying Havens:       “An organization cannot, of course,
manufacture the injury necessary to maintain a suit from its
expenditure of resources on that very suit. Were the rule

that of injury in fact, the closeness of the factual contexts makes
cases applying Havens somewhat helpful in understanding how
causation works for organizational standing under section
17204. To satisfy the traceability requirement, “there must be
a causal connection between the injury and the conduct
complained of — the injury has to be ‘fairly . . . trace[able] to the
challenged action of the defendant, and not . . . th[e] result [of]
the independent action of some third party not before the
court.’ ” (Lujan v. Defenders of Wildlife (1992) 504 U.S. 555,
560.) Where the organization’s mission has been impaired or
threatened, courts have deemed the diversion of resources
traceable to the defendant’s conduct. (See, e.g., Comite de
Jornaleros de Redondo Beach v. City of Redondo Beach (9th Cir.
2011) 657 F.3d 936, 943 [organization assisting day laborers
established sufficient “causal connection” between city’s
antisoliciting ordinance and organization’s diversion of
resources]; Pacific Legal Foundation v. Goyan, supra, 664 F.2d
at p. 1224 [pre-Havens decision: in light of the plaintiff’s
mission, it was “only natural for plaintiff to increase its vigilance
and efforts” in response to contested policy].)             In some
circumstances, however, a causal chain posited for
organizational standing can become so attenuated that it fails
the fair-traceability test. (See, e.g., Center for Law and Educ. v.
Department of Educ. (D.C. Cir. 2005) 396 F.3d 1152, 1160–
1161.)

                                  30
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

otherwise, any litigant could create injury in fact by bringing a
case, and Article III would present no real limitation.” (Spann
v. Colonial Village, Inc., supra, 899 F.2d at p. 27; accord, La
Asociacion de Trabajadores de Lake Forest v. City of Lake
Forest (9th Cir. 2010) 624 F.3d 1083, 1088; Fair Housing of
Marin v. Combs, supra, 285 F.3d at p. 90.)
      As CMA argues, however, it has met both standing
requirements. The evidence submitted on summary judgment
sufficiently showed (that is, it was sufficient to create a triable
issue) that CMA’s expenditures in diverted resources were
undertaken in response to a perceived threat to CMA’s ability to
perform its preexisting mission, which according to its general
counsel includes “advocacy and education on issues involving
health insurance companies’ interference with the sound
medical judgment of physicians.” CMA alleges that Aetna’s
policy posed a perceived threat to this mission, in particular to
the independent medical decisionmaking by its physician
members and thus to the health of patients; CMA responded by
diverting its own resources to oppose the policy. The evidence
further showed that some or all of those resource diversions
were independent of any preparations CMA may have made for
this litigation. The expenditures included efforts to counsel
CMA’s members on how to deal with Aetna’s implementation of
the Network Intervention Policy, provision of public information
for the use of patients, and interactions with regulatory agencies
with the goal of stopping Aetna’s policy implementation, or
alleviating its effects, by means other than private litigation
under the UCL.
      This is not a case of an organization attempting to
manufacture standing and insert itself into a dispute in which

                                  31
     CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                      CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

it had no natural stake. While voluntary in one sense — CMA,
like many other organizations, is free to set its own budgetary
priorities — its decision to expend resources on working to
counter the perceived threat in Aetna’s policy followed from that
policy in a sufficiently direct and uninterrupted causal chain.10
    For the above reasons, Aetna was not entitled to
summary judgment on causation grounds.
     C. Evasion of Proposition 64’s Purposes
      Beyond their textual arguments focused on economic
injury and causation, Aetna and its allied amici curiae contend
that recognizing a diversion-of-resources theory of standing in
this case would flout the intent of the voters who passed
Proposition 64 in order to restrict UCL standing. To assess
these claims, we look beyond the operational text in section
17204 — which is consistent with the diversion-of-resources
theory but does not explicitly endorse it — and examine other
indicia of voter intent.

10
       As Aetna notes, one federal appellate court held the
Havens standing theory inapplicable where the only threat
posed by a challenged statute was to the plaintiff organization’s
“pure issue-advocacy.” (Center for Law and Educ. v. Department
of Educ., supra, 396 F.3d at p. 1162.) In a later decision,
however, the same court expressed doubt about the existence of
“a sharp distinction between advocacy and other activities”
(American Soc. for Prevention of Cruelty to Animals v. Feld
Entertainment, Inc. (D.C. Cir. 2011) 659 F.3d 13, 26) and
concluded that “[u]ltimately, whether injury to an organization’s
advocacy supports Havens standing remains an open question”
(id. at p. 27). In any event, CMA claims not that Aetna’s policy
impaired its ability to lobby government agencies on abstract
issues, but that it threatened CMA’s mission of service to its
members, the medical profession, and the public health.

                                 32
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

      In its introductory findings and declarations, Proposition
64 identified certain assertedly objectionable practices in UCL
litigation, including the law’s “misuse[] by some private
attorneys who . . . [¶] . . . [¶] (3) [f]ile lawsuits for clients who
have not used the defendant’s product or service, viewed the
defendant’s advertising, or had any other business dealing with
the defendant.” (Voter Information Guide, Gen. Elec., supra,
text of Prop. 64, § 1, subd. (b)(3), p. 109, italics added.) We
alluded in Kwikset to this italicized language, describing
Proposition 64’s “apparent purposes” as eliminating standing
“for those who have not engaged in any business dealings with
would-be defendants and thereby strip such unaffected parties
of the ability to file ‘shakedown lawsuits,’ while preserving for
actual victims of deception and other acts of unfair competition
the ability to sue and enjoin such practices.” (Kwikset, supra, 51
Cal.4th at p. 317, italics added; see also id. at p. 321.) Observing
that CMA neither competes with Aetna nor was itself subject to
the Network Intervention Policy, Aetna argues CMA had no
business dealings with it and, therefore, necessarily lacks
standing to sue under our decision in Kwikset.
       Aetna’s argument reads too much into Kwikset’s allusion
to Proposition 64’s purposes. In Kwikset, there was no dispute
that the plaintiffs had dealt with the defendant, whose allegedly
false labeling had led the plaintiffs to purchase the defendant’s
product. (Kwikset, supra, 51 Cal.4th at p. 319.) Nowhere in
Kwikset did we suggest that section 1 of Proposition 64, which
set out the initiative measure’s findings and statement of
purpose, holds legal force independent of the actual statutory
language added by the measure. With regard to standing, that
operational language is contained in section 17204, which does

                                  33
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

not require a plaintiff to have had business dealings with the
defendant but only to have “suffered injury in fact” and “lost
money or property as a result of the unfair competition.”
Kwikset’s holdings were reached through analysis of that
operative language, not by reliance on the statement of purpose
in section 1 of Proposition 64. (See Kwikset, supra, 51 Cal.4th
at pp. 321–327.)
      Section 1 of Proposition 64 explained to voters why limits
on standing to sue were viewed as necessary but did not itself
add any such limits to the law. The section’s reference to
plaintiffs who have had no business dealings with the defendant
formed part of that explanation; it did not add or amend any
statutory provisions of the UCL. (See Allergan, Inc. v. Athena
Cosmetics, Inc. (Fed.Cir. 2011) 640 F.3d 1377, 1383
[“Proposition 64 did not add a ‘business dealings requirement’ to
standing under section 17204”].) Understood as explanatory
rather than operational, the reference to lack of business
dealings does not indicate an intent to bar suit by plaintiffs like
CMA who have suffered economic injury as a result of an
allegedly unlawful or unfair business practice.
     Though it was neither a competitor of Aetna nor a
consumer of that company’s services, CMA was affected in its
mission by Aetna’s policy. CMA responded by devoting staff
time and other resources to opposing and helping its members
navigate that policy’s implementation, a diversion of resources
that constituted an economic injury. CMA is far from the type
of disinterested plaintiff Proposition 64 sought to bar from suing
under the UCL, and in seeking an injunction against practices
that caused it to divert its own resources CMA has not brought

                                  34
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                  Opinion of the Court by Evans, J.

what the voters characterized as a “ ‘shakedown lawsuit[].’ ”
(Kwikset, supra, 51 Cal.4th at p. 317.)
      More broadly, Aetna argues that the diversion-of-
resources theory subverts the limiting intent of Proposition 64
by allowing an organization to “create standing for [itself] by
choosing to advocate against any practice the organization
disagrees with.” Aetna raises the hypothetical case of an
organization with a generally stated mission, for example
“Californians for Fair Competition,” that after “a brief stint of
advocacy” could have standing for “wide swaths of potential
UCL litigation,” thus reinstituting the kind of “ ‘shakedown
suits’ ” by uninjured plaintiffs Proposition 64 was intended to
foreclose.   Amicus curiae the United States Chamber of
Commerce makes a similar argument, hypothesizing that “an
attorney who wishes to sue travel agencies who fail to include
their agents’ licenses on their websites,” for example, could form
an organization with a stated mission of promoting
transparency in the travel industry, hire a staff member and,
“after a few weeks, . . . ‘divert’ that staff member’s time to
writing letters to travel agencies who have not publicly posted
their agents’ licenses.”
     We are not persuaded that recognizing a diversion-of-
resources theory in this case will open the door to abuses of the
sort suggested by Aetna and the amicus curiae. CMA is an
organization with a bona fide mission of promoting the medical
profession and the public health, not one formed for the purpose
of UCL litigation. Its pursuit of these goals substantially
predates the events that gave rise to this litigation, rather than
being adopted as a pretext to create UCL standing. Aetna’s
Network Intervention Policy, in CMA’s view, threatened CMA’s

                                 35
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                   Opinion of the Court by Evans, J.

ability to pursue its mission, and it responded by taking several
steps to oppose the policy and alleviate its effects on CMA’s
members, independent of any existing or planned UCL
litigation. These steps required reallocation of staff time and
other resources from other ongoing projects, giving rise to the
economic injury that supports standing here. CMA presented
sufficient evidence to, at the least, create triable issues of fact
on these points.
      In contrast, the organizations in Aetna’s and the amicus
curiae’s hypotheticals might well have difficulty establishing
that they were sincerely pursuing missions separate from
planned UCL litigation and that their efforts on a given issue
were not undertaken simply to establish standing for such
litigation. Without an articulable mission focused enough to
make sense outside the UCL litigation context, an organization
like “Californians for Fair Competition” would be hard pressed
to show that its allocation of resources was in fact undertaken
in response to a threat to its mission or that it diverted staff
from mission-oriented work they would otherwise have pursued.
In short, it is far from clear that an isolated “brief stint of
advocacy,” unconnected to a preexisting mission independent of
UCL litigation, would suffice to show economic injury and
causation for purposes of section 17204.
                        III. CONCLUSION
      Viewing the evidence submitted on Aetna’s motion for
summary judgment in the light most favorable to CMA and
drawing all reasonable inferences in CMA’s favor, as we must
(Weiss v. People ex rel. Department of Transportation, supra, 9
Cal.5th at p. 864), we conclude the evidence established a triable
issue of fact as to standing to sue under the UCL. The Court of

                                  36
    CALIFORNIA MEDICAL ASSOCIATION v. AETNA HEALTH OF
                     CALIFORNIA INC.
                 Opinion of the Court by Evans, J.

Appeal erred in affirming the trial court’s grant of summary
judgment for the defense on the ground that CMA lacked such
standing.
                      IV. DISPOSITION
     The judgment of the Court of Appeal is reversed.

                                                     EVANS, J.

We Concur:
GUERRERO, C. J.
CORRIGAN, J.
LIU, J.
KRUGER, J.
GROBAN, J.
JENKINS, J.

                                37
See next page for addresses and telephone numbers for counsel who
argued in Supreme Court.

Name of Opinion California Medical Association v. Aetna Health of
California Inc.
__________________________________________________________

Procedural Posture (see XX below)
Original Appeal
Original Proceeding
Review Granted (published) XX 63 Cal.App.5th 660
Review Granted (unpublished)
Rehearing Granted
__________________________________________________________

Opinion No. S269212
Date Filed: July 17, 2023
__________________________________________________________

Court: Superior
County: Los Angeles
Judge: Elihu M. Berle
__________________________________________________________

Counsel:

Whatley Kallas, Alan M. Mansfield, Edith M. Kallas, Deborah J.
Winegard; Altshuler Berzon, Michael Rubin and Stacey M. Leyton for
Plaintiff and Appellant.

Rob Bonta, Attorney General, Nicklas A. Akers, Assistant Attorney
General, Michele Van Gelderen and Amy Chmielewski, Deputy
Attorneys General, for the Attorney General of California as Amicus
Curiae on behalf of Plaintiff and Appellant.

Strumwasser & Woocher, Michael J. Strumwasser, Bryce A. Gee and
Salvador Perez for the American Medical Association as Amicus Curiae
on behalf of Plaintiff and Appellant.

Jerry Flanagan and Ryan Mellino for Consumer Watchdog as Amicus
Curiae on behalf of Plaintiff and Appellant.
Law Office of Jonathan Weissglass and Jonathan Weissglass for the
Service Employees International Union California State Council,
International Brotherhood of Teamsters Joint Council 7, Writers Guild
of America, West, Inc., United Food and Commercial Workers Western
States Council and United Farm Workers of America as Amici Curiae
on behalf of Plaintiff and Appellant.

Thomas A. Myers, Jonathan M. Eisenberg and Kirra N. Jones for AIDS
Healthcare Foundation as Amicus Curiae on behalf of Plaintiff and
Appellant.

David Chiu, City Attorney (San Francisco), Yvonne R. Meré and Owen
J. Clements, Chief Deputy City Attorneys, Ronald H. Lee, Deputy City
Attorney, Barbara J. Parker, City Attorney (Oakland), Mara W. Elliott,
City Attorney (San Diego) and Nora V. Frimann, City Attorney (San
Jose), for local prosecutors as Amici Curiae on behalf of Plaintiff and
Appellant.

Cristina Kladis and Christopher Berry for Animal Legal Defense Fund
as Amicus Curiae on behalf of Plaintiff and Appellant.

Spertus, Landes & Umhofer, Matthew Umhofer, Elizabeth Mitchell;
Williams & Connolly, Enu Mainigi, Craig Singer, Grant Geyerman and
Benjamin Hazelwood for Defendant and Respondent.

Munger, Tolles & Olson, Sarah Weiner and Henry Weissmann for
Chamber of Commerce of the United States of America as Amicus
Curiae on behalf of Defendant and Respondent.

Daponde Simpson Rowe, Michael J. Daponde and Darcy Muilenburg
for California Association of Health Plans and Association of California
Life and Health Insurance Companies as Amici Curiae on behalf of
Defendant and Respondent.

The Office of Michael Tenenbaum and Michael Tenenbaum for Ken
Frank and Sean Chaney as Amici Curiae on behalf of Defendant and
Respondent.
Counsel who argued in Supreme Court (not intended for
publication with opinion):

Stacey M. Leyton
Altshuler Berzon LLP
177 Post Street, Suite 300
San Francisco, CA 94108
(415) 421-7151 ext. 304

Benjamin Hazelwood
Williams & Connolly LLP
680 Maine Avenue, SW
Washington, DC 20024
(202) 434-5159