Court Opinion

ID: 4696223
Source: CourtListenerOpinion
Date Created: 2021-06-16 20:03:21.088079+00
Date Added: 2024-06-11T08:05:39.253778
License: Public Domain

Filed 6/16/21
                     CERTIFIED FOR PUBLICATION

       IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                        FIRST APPELLATE DISTRICT

                                   DIVISION TWO

 KIM LEE,
        Plaintiff and Appellant,
                                             A157657
 v.
 LUXOTTICA RETAIL NORTH                      (San Francisco County
 AMERICA, INC., et al.,                      Super. Ct. No. CGC17562793)
        Defendants and Respondents.

       Appellant Kim Lee, O.D., acting on behalf of a putative class of
optometrists in California with independent optometry practices, brought
suit against a competing chain of optical retailers. He now appeals from a
judgment sustaining without leave to amend a demurrer to his second
amended complaint, which asserts a single cause of action under California’s
Unfair Competition Law (UCL) (Bus. and Prof. Code, § 17200 et seq.).
       We hold that the only relief plaintiff requests against his competitors—
compensation for lost market share—is not a remedy authorized by the UCL,
because it does not constitute restitution, the only form of nonpunitive
monetary recovery authorized under the UCL. Simply put, compensation for
expected but unearned future income to which the plaintiff has no legal
entitlement is not recoverable as restitution under the UCL, regardless
whether it is characterized as lost market share. Lost profits are damages,
not restitution, and are unavailable in a private action under the UCL.

                                        1
Accordingly, the demurrer was properly sustained, and we will affirm the
judgment.
                               BACKGROUND
      “ ‘Because “[t]his case comes to us after the sustaining of a general
demurrer . . . , we accept as true all the material allegations of the
complaint.” ’ ” (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th
1134, 1141 (Korea Supply).)
      Plaintiff Kim Lee, O.D., is a San Francisco optometrist who has
operated his independent practice since 2002. In 2017, he commenced this
action against two corporate affiliates operating a chain of optical retail
stores in California that offer competing eyeglass products and optometry
services: parent company Luxottica Retail North America, Inc., an Ohio
corporation doing business in California under the name LensCrafters, and
its wholly owned subsidiary, Eyexam of California, Inc.1 The action was
brought on behalf of a putative class of optometrists consisting of “All
California doctors of optometry in practices independent of control by a retail
chain optical store in California, and whose practices were located within
20 miles of a LensCrafters location between November 30, 2013 and
September 1, 2015.”
      Lee’s second amended complaint alleges that during this period,
defendants operated the LensCrafters chain of stores in a manner that
violated state laws regulating the practice of optometry and the dispensing of
optical products, thereby constituting unfair and/or unlawful business
practices in violation of the UCL.

      1Unless otherwise specified, we will refer to these defendants jointly
as LensCrafters.

                                        2
      He alleges that, as a result of these practices, the putative class
members lost “market share” in retail sales based on allegations they had
“vested interests in the Total Addressable Market of individuals who visited
optometrists.” In particular, he alleges “[s]tudies have shown that adults are,
on average, willing to drive more than 20 miles for routine medical care” and
that “[i]f patients had not been able to visit illegal optometry locations, a
statistically significant and statistically ascertainable percentage of such
patients would have instead visited at least one member of the Class within
20 miles of the illegal locations [operated by defendants that] such patients
visited.” Thus, he alleges that the putative class members “lost market share
in their optical retail sales” due to defendants’ conduct which, conversely,
“improperly increase[ed] their market share of optical product sales in
California.” He alleges that “during the Class Period there were
approximately 150 LensCrafters locations throughout California which
serviced customers who would have gone to different optometrist[s] if they
had not visited LensCrafters, creating a pool of funds in which every legally
operating optometrist in the area had a vested interest,” and that “[m]embers
of the class are each entitled to their fair share of their cumulative vested
interest.” The putative class members allegedly “lost their vested interest in
the pool of funds that were spent on illegal optometry services and illegal
retail sales of optical goods, which would have instead been spent in a legal
location.”
      The only remedy prayed for is a judgment “[o]rdering the
restitution/disgorgement of all sums obtained by Defendants through
improper taking of market share from Class Members through violations of
the UCL.”

                                        3
      LensCrafters demurred to the second amended complaint, challenging
both the remedy sought and the class allegations.2 The trial court sustained
the demurer without leave to amend, on the ground that plaintiff failed to
allege an entitlement to restitution under the UCL. Judgment was entered,
and plaintiff timely appealed.
                                 DISCUSSION
      “A demurrer is properly sustained when ‘[t]he pleading does not state
facts sufficient to constitute a cause of action.’ (Code Civ. Proc., § 430.10,
subd. (e).) On appeal, a resulting judgment of dismissal is reviewed
independently. [Citation.] ‘ “ ‘[W]e accept as true all the material allegations
of the complaint’ ” ’ [citation], but do not ‘assume the truth of contentions,
deductions or conclusions of law.’ ” (Roy Allan Slurry Seal, Inc. v. American
Asphalt South, Inc. (2017) 2 Cal.5th 505, 512.)
      The UCL proscribes “any unlawful, unfair or fraudulent business act or
practice and unfair, deceptive, untrue or misleading advertising,” and any act
prohibited by California’s false advertising law. (Bus. & Prof. Code, § 17200;
see also id., § 17500.) Its purpose “ ‘is to protect both consumers and
competitors by promoting fair competition in commercial markets for goods
and services’ [citation][,] . . . [and to] ‘provide[] an equitable means through
which both public prosecutors and private individuals can bring suit to
prevent unfair business practices and restore money or property to victims of
these practices.’ ” (Solus Industrial Innovations, LLC v. Superior Court
(2018) 4 Cal.5th 316, 340.) “By prohibiting unlawful business practices,
‘ “section 17200 ‘borrows’ violations of other laws and treats them as unlawful
practices” that the unfair competition law makes independently actionable.’ ”

      2 The trial court had previously sustained defendants’ demurrer to the
first amended complaint with leave to amend.

                                        4
(De La Torre v. CashCall, Inc. (2018) 5 Cal.5th 966, 980.) Actions may be
brought by the Attorney General or other specified public officials, and “by a
person who has suffered injury in fact and has lost money or property as a
result of the unfair competition.”3 (Bus. & Prof. Code, § 17204.)
      “While the scope of conduct covered by the UCL is broad, its remedies
are limited.” (Korea Supply, supra, 29 Cal.4th at p. 1144.) Injunctive relief is
the primary form of relief available. (McGill v. Citibank, N.A. (2017)
2 Cal.5th 945, 954; Bus. & Prof. Code, § 17203.) In public enforcement
actions, civil penalties also may be assessed. (See Bus. & Prof. Code,
§ 17206.) But in a private action, “[t]he only monetary remedy available . . .
is restitution.” (Clark v. Superior Court (2010) 50 Cal.4th 605, 613; see Bus.
& Prof. Code, § 17203 [court may “make such orders and judgments . . . as
may be necessary to restore to any person in interest any money or property,
real or personal, which may have been acquired by means of such unfair
competition”].) Damages are not recoverable. (Bank of the West v. Superior
Court (1992) 2 Cal.4th 1254, 1266.) In short, “under the UCL, ‘[p]revailing
plaintiffs are generally limited to injunctive relief and restitution.’ ” (Korea
Supply, at p. 1144.)
      Here, plaintiff contends the demurrer was improperly sustained
because lost market share is a restitutionary remedy authorized by the UCL.
We do not agree.
      Although the precise question here is one of first impression in
California, it is squarely controlled by our Supreme Court’s 2003 decision in

      3 The injury in fact requirement was added by the electorate in 2004
through the passage of Proposition 64, which also eliminated the ability of
private plaintiffs to bring a representative action on behalf of the general
public without meeting the requirements for a class action. (See Arias v.
Superior Court (2009) 46 Cal.4th 969, 977-980.)

                                        5
Korea Supply, supra, 29 Cal.4th 1334, which addressed “what claims and
remedies may be pursued by a plaintiff who alleges a lost business
opportunity due to the unfair practices of a competitor.” (Id. at p. 1140.)
      In Korea Supply, the plaintiff was an agent representing the supplier of
military equipment in the supplier’s bid to procure a lucrative military
contract with a foreign government. (Korea Supply, supra, 29 Cal.4th at
p. 1141.) If the bid was successful, the plaintiff stood to earn a $30 million
commission. (Ibid.) The contract was awarded to a competitor, however.
The agent then brought suit against the winning bidder under the UCL (and
asserted related tort claims), alleging the contract had been procured by
wrongful means (i.e., bribes and sexual favors). (Korea Supply, at pp. 1141-
1142.) Its UCL claim sought disgorgement of all profits the winning bidder
had realized under the winning contract. (Korea Supply, at p. 1142.) The
trial court sustained a demurrer without leave to amend to the UCL claim on
the ground it did not allege facts sufficient to state a cause of action. (Korea
Supply, at pp. 1142-1143.) The appellate court reversed, but the Supreme
Court ruled the demurrer to the UCL cause of action had been properly
sustained because the plaintiff could not recover monetary relief under the
UCL. (See Korea Supply, at pp. 1142, 1152.)
      First, the Supreme Court held that non-restitutionary disgorgement of
profits—that is, profits that are neither money a defendant took from the
plaintiff nor funds in which the plaintiff has an ownership interest—is not an
authorized remedy under the UCL in an individual action. (See Korea
Supply, 29 Cal.4th at pp. 1140, 1144-1148, 1152.) It extended this principle
from the rule already established in the context of representative suits
brought under the UCL. (See Korea Supply, at pp. 1144-1145; Kraus v.
Trinity Management Services, Inc. (2000) 23 Cal.4th 116, 137, superseded by

                                        6
statute on other grounds as stated in Amalgamated Transit Union, Local
1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th 993, 1000.) It also
examined the statute’s history and purpose, and found “nothing to indicate
that the Legislature intended to authorize a court to order a defendant to
disgorge all profits to a plaintiff who does not have an ownership interest in
those profits.” (Korea Supply, at p. 1147.)
      The court also found support in the text of Business and Professions
code section 17203, the UCL’s general remedial provision, concluding the
UCL’s monetary remedies are quite circumscribed despite the UCL’s broad
remedial purposes. The court explained, “the language of section 17203 is
clear that the equitable powers of a court are to be used to ‘prevent’ practices
that constitute unfair competition and to ‘restore to any person in interest’
any money or property acquired through unfair practices. ([Bus. & Prof.
Code,] § 17203.) While the ‘prevent’ prong of [Business and Professions Code]
section 17203 suggests that the Legislature considered deterrence of unfair
practices to be an important goal, the fact that attorney fees and damages,
including punitive damages, are not available under the UCL is clear
evidence that deterrence by means of monetary penalties is not the act’s sole
objective. A court cannot, under the equitable powers of section 17203, award
whatever form of monetary relief it believes might deter unfair practices. The
fact that the ‘restore’ prong of section 17203 is the only reference to monetary
penalties in this section indicates that the Legislature intended to limit the
available monetary remedies under the act.” (Korea Supply, supra,
29 Cal.4th at pp. 1147-1148, italics added.) Canvassing prior caselaw, the
court concluded by “confirm[ing] what we have previously held: Under the
UCL, an individual may recover profits unfairly obtained to the extent that

                                       7
these profits represent monies given to the defendant or benefits in which the
plaintiff has an ownership interest.” (Id. at p. 1448, italics added.)
      Judged by these standards, the court held that the plaintiff’s requested
remedy was not restitutionary. (Korea Supply, supra, 29 Cal.4th at p. 1149.)
“The object of restitution,” it explained, “is to restore the status quo by
returning to the plaintiff funds in which he or she has an ownership interest.”
(Ibid., italics added.) There, however, plaintiff had no ownership interest in
the funds it sought to disgorge. (Ibid.) First, the court explained, “it is clear
that plaintiff is not seeking the return of money or property that was once in
its possession,” because “[plaintiff] has not given any money to [the winning
bidder]; instead, it was from the [foreign country] that [defendant] received
its profits.” (Ibid.) Thus, “[a]ny award that plaintiff would recover from
defendants would not be restitutionary as it would not replace any money or
property that defendants took directly from plaintiff.” (Ibid.)
      Second, citing and discussing Cortez v. Purolator Air Filtration
Products Co. (2000) 23 Cal.4th 163 (Cortez), the court acknowledged that
restitution under the UCL is not limited to the recovery of money or property
that was once in the plaintiff’s possession but also encompasses the recovery
of money or property in which the plaintiff has a “vested interest,” but held
plaintiff had no such interest. (Korea Supply, supra, 29 Cal.4th at pp. 1149-
1150.) Cortez held that earned but unlawfully withheld wages are
recoverable as a restitutionary remedy under the UCL, because the wages
once earned are “as much the property of the employee who has given his or
her labor to the employer in exchange for that property as is property a

                                        8
person surrenders through an unfair business practice.”4 (Cortez, at pp. 177-
178.) Contrasting what it called an employee’s “vested interest” in earned
but unpaid wages (Cortez), Korea Supply held that plaintiff had no
comparable vested interest in the receipt of its anticipated commission. At
most, its interest was only an “ ‘expectancy’ ” or a “contingent” one. (Korea
Supply, at p. 1149.) The plaintiff only expected payment if its client was
awarded the contract, and “[s]uch an attenuated expectancy cannot . . . be
likened to ‘property’ converted by [defendant] that can now be the subject of a
constructive trust,” because the requested recovery “cannot be traced to any
particular funds in [defendant’s] possession.” (Id. at p. 1150.) The court also
called plaintiff’s expectancy interest in the commission even “further
attenuated,” because, unlike in Cortez, it never anticipated payment directly
from the defendant but from a third party (i.e., from its client). (Ibid.)
“Unlike Cortez, then, the monetary relief requested by [plaintiff] does not
represent a quantifiable sum owed by defendants to plaintiff.” (Ibid.) For
these reasons, the Supreme Court concluded plaintiff’s claim was seeking
non-restitutionary disgorgement. (Ibid.)
      Korea Supply reaffirmed that “the UCL ‘is not an all-purpose substitute
for a tort or contract action,’ ” and rejected the plaintiff’s suggestion to limit
the remedy to the amount it would have earned as a commission. (Korea
Supply, supra, 29 Cal.4th at pp. 1150-1151, quoting Cortez, supra, 23 Cal.4th
at p. 173) The Supreme Court observed that the remedy plaintiff sought
“closely resembles a claim for damages, something that is not permitted” and,
quoting a federal district court decision that dismissed a UCL claim brought

      4 Cortez found a property interest in that situation, because “equity
regards that which ought to have been done as done (Civ. Code, § 3529), and
thus recognizes equitable conversion.” (Cortez, supra, 23 Cal.4th at p. 178.)

                                         9
against a direct competitor, noted that “ ‘[c]ompensation for a lost business
opportunity is a measure of damages and not restitution to the alleged
victims.’ ” (Korea Supply, at pp. 1150-1151, quoting MAI Systems Corp. v.
UIPS (N.D. Cal. 1994) 856 F.Supp. 538, 542 (MAI Systems); see also MAI
Systems, at p. 542 [“A restitutionary remedy would only be available to the
victims of [defendant’s] purportedly misleading [actions]—the allegedly
overcharged customers—and not by [plaintiff’s] competitors”].) From a public
policy perspective, the court also expressed its concern that allowing
monetary recovery on the theories advanced by plaintiff would enable
plaintiffs to recover tort damages while “bypassing the burden of proving the
elements of liability” under “traditional tort and contract claims”—
“something the Legislature never intended.” (Korea Supply, at p. 1151.)
      Finally, the court explained that the decision did not leave the plaintiff
or those affected by a defendant’s unfair practices without a remedy. (Korea
Supply, supra, 29 Cal.4th at p. 1152.) It noted that damages were potentially
available under traditional tort law, injunctive relief was available under the
UCL, and “[a]ctual direct victims of unfair competition may obtain restitution
as well.” (Korea Supply, at p. 1152.) Its decision “merely reaffirms the
balance struck in this state's unfair competition law between broad liability
and limited relief.” (Ibid.)
      There is no meaningful distinction between the remedy struck down as
non-restitutionary in Korea Supply and the “lost market share” theory of
recovery plaintiff asserts in this lawsuit. As in Korea Supply, plaintiff alleges
that LensCrafters engaged in practices that caused him and the other
putative class members to lose business. However one describes it (as “lost
market share,” loss of a business “opportunity,” or lost profits), the only
monetary relief that plaintiff seeks is lost income from sales that never took

                                       10
place, because such sales allegedly were unlawfully diverted to defendants.5
Yet Korea Supply stands unequivocally for the proposition that unearned
income (there, commission from a single business transaction that failed to
materialize) is not recoverable as restitution under the UCL—because the
plaintiff has no ownership interest in it. It does not represent money the
plaintiff ever parted with, nor does the plaintiff have any legally enforceable
property interest in it, analogous to wages that have been earned but
unlawfully withheld (Cortez). Indeed, as our Supreme Court recently
reaffirmed in another context, where economic relationships have not
“solidified into binding future promises” but are merely prospective,
“[n]either party to such a relationship has a legal claim to continued relations
with the other.” (Ixchel Pharma, LLC v. Biogen, Inc. (2020) 9 Cal.5th 1130,
1146-1147.) There is thus no sense in which plaintiff’s interest in future
income from his customer base is vested, as opposed to merely contingent.
(See also Pineda v. Bank of America, N.A. (2010) 50 Cal.4th 1389, 1402
[wages that have not been earned but are potentially recoverable as a
statutory penalty cannot be recovered as restitution in an action under the
UCL, because “[u]ntil awarded by a relevant body, employees have no . . .
vested interest” in those funds].)
      Plaintiff argues that Korea Supply is distinguishable because the case
did not involve lost market share. Instead, he argues the putative class
members here do have a “vested interest” in their share of the optical market,
analogous to earned but unpaid wages, because plaintiff and the other class
members “earned their share of the market by providing optometry services

      5 Plaintiff acknowledges this in his reply brief, where he asserts that
“the market share taken by Defendants represents actual business
transactions which [plaintiff] and the class would have had but for
Defendants’ UCL violation.” (Italics added.)

                                       11
and products to their customers, including those customers who would have
been part of that market share but instead patronized Defendants as a result
of their violation of the UCL.” (Italics added.) This boils down to plaintiff’s
contention that Korea Supply involved only a “single transaction” whereas
this case involves “thousands of actual business transactions taken from
[plaintiff] and the class . . . which can be proven by statistical analysis.” For
multiple reasons, these distinctions are unavailing.
      First, Korea Supply did involve lost market share. In that case, it was
a market of one (i.e., the foreign government buyer). There is no reason to
think the Supreme Court would have come out the other way had the
competitor been alleged to have bribed its way into military contracts with
two buyers, or three, or even thousands.6
      More fundamentally, we cannot accept the proposition that a business
has a vested property right in the share of the market that it occupies,

      6  In his reply brief, plaintiff cites authorities addressing the use of
statistical evidence in a variety of contexts (see Duran v U.S. Bank National
Assn. (2014) 59 Cal.4th 1, 39-41; Brinker Restaurant Corp. v. Superior Court
(2012) 53 Cal.4th 1004, 1054 [conc. opn. of Werdegar, J.]), including to prove
to the amount of restitution recoverable under the UCL in consumer class
actions (see Nelson v. Pearson Ford Co. (2010) 186 Cal.App.4th 983, 1016-
1017 [involving stipulation to use statistical sampling methodology],
disapproved on another ground in Raceway Ford Cases, 2 Cal.5th 161, 180
(2016); Walker v. Life Insurance Co. of Southwest (C.D. Cal., July 31, 2018,
No. CV1009198JVSRNBx) 2018 WL 3816716, at *8 [ruling on motion for
class certification], affd. (9th Cir. 2020) 953 F.3d 624), and argues that “[t]he
sufficiency of the statistical evidence to prove that Defendants unlawfully
took the class’s market share is a factual issue which cannot be resolved by
demurrer.” This misses the point. The issue here is not the methodology by
which plaintiff hopes to prove either liability or the amount of lost sales. The
question is whether plaintiff and the putative class members are entitled to
recover any compensation for lost income as restitution under the UCL.
None of these cited authorities have any bearing on that issue.

                                        12
equivalent (plaintiff says) to an employee’s vested property right in wages
already earned. That proposition, for which plaintiff cites no authority, not
only would have serious implications far beyond the context of this dispute
but is itself astonishingly anticompetitive. It assumes that, at any arbitrary
point forever fixed in time, customers have no right to do business wherever
and with whomever they please and that competing businesses, including
those operating legally, have no right to enter the market.7 That is the
antithesis of free competition.
      What plaintiff characterizes as a vested property interest in his share
of the optical market, earned through developing his business, is somewhat
akin to business goodwill. (See Bus. & Prof. Code, § 14100 [“The ‘good will’ of
a business is the expectation of continued public patronage”]; accord, Baker v.
Pratt (1986) 176 Cal.App.3d 370, 380.) Goodwill is an intangible asset that
can be sold (see NewLife Sciences, LLC v. Weinstock (2011) 197 Cal.App.4th
676, 689, fn. 11; Bus. & Prof. Code, § 14102), and a form of property the
impairment or destruction of which can be remedied through an award of
damages. (Baker, at pp. 380-381.) The only California case of which we are
aware that addresses the issue concludes that damages for harm to goodwill
is not a restitutionary remedy. (See Citizens of Humanity, LLC v. Costco
Wholesale Corp. (2009) 171 Cal.App.4th 1, 22 [harm to plaintiff’s goodwill
“would not entitle [plaintiff] to restitution [under Korea Supply],”
disapproved on another ground, Kwikset Corp. v. Superior Court (2011)
51 Cal.4th 310, 337 (Kwikset)).8

      7 Plaintiff makes no bones about this. He repeatedly says in his
briefing that the business LensCrafters allegedly diverted from the putative
class members “belonged to” the class.
      8 Here, plaintiff does not expressly allege that LensCrafters deprived
him of his goodwill. Rather, he alleges he and others were deprived of the

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      In addition, federal courts both before and after Korea Supply have
consistently held that compensation for lost business is not recoverable in an
action against a business competitor under the UCL. (See, e.g., Ozeran v.
Jacobs (9th Cir. Feb. 18, 2020) 798 Fed.Appx. 120, 122-123 [allegations that
competitor’s unfair business practices diverted business from plaintiff to
competitor held insufficient to state a claim under the UCL]; MAI Systems,
supra, 856 F.Supp. at p. 542 [“A restitutionary remedy would only be
available to the victims of [computer maker’s] purportedly misleading
contracts—the allegedly overcharged customers—and not to [computer
maker’s] competitors”]; POM Wonderful LLC v. Coca Cola, Inc. (C.D. Cal.
2010) 727 F. Supp.2d 849, 870 [“ ‘there is no reasonable definition of vested
interest that would include market share’ ”], judg. vacated and remanded in
part on other grounds (9th Cir. 2012) 679 F.3d 1170, 1178-1179; Rimini
Street, Inc. v. Oracle International Corp. (D. Nev. 2020) 473 F.Supp.3d 1158,
1226; Rosen v. Uber Technologies, Inc. (N.D.Cal. 2016) 164 F.Supp.3d 1165,
1178; AngioScore, Inc. v. TriReme Medical, LLC (N.D. Cal. 2014) 70
F.Supp.3d 951, 962-963; SkinMedica, Inc. v. Histogen Inc. (S.D. Cal. 2012)
869 F.Supp.2d 1176, 1183-1187.) We agree. Simply put, lost business is a
form of damages—it is not restitutionary. (See Cacique, Inc. v. Robert Reiser
& Co., Inc. (9th Cir. 1999) 169 F.3d 619, 624 [competitor’s sales and revenue
data held irrelevant and not subject to discovery in UCL action that seeks to
recover a “royalty” based on competitor’s profitability, because “California
law is clear” that damages are not recoverable under Bus. & Prof. Code,
§ 17200].)

income they would have received had LensCrafters not competed with them
in an unlawful manner.

                                      14
      Against the weight of this authority, plaintiff argues that it may seek
restitution of its “lost market share” under Law Offices of Mathew Higbee v.
Expungement Assistance Services (2013) 214 Cal.App.4th 544 (Higbee), a case
that addressed the standing requirements under the UCL. Higbee provides
no support for plaintiff’s novel bid to recover unearned income as restitution.
Higbee held that the plaintiff’s alleged loss of customers and revenue due to a
competitor’s allegedly unlawful business practices, as well as allegations he
had been forced to lower his prices and increase advertising spending, which
collectively was described as a “loss of market share,” was sufficient to
establish standing to sue. (Id. at pp. 555-556.) The appellate court did not
address whether these allegations stated a claim for restitution (the plaintiff
sought an injunction and “damages” (see id. at pp. 550-551)), and ineligibility
for restitution does not defeat standing under the UCL. (Kwikset, supra,
51 Cal.4th at p. 337.) “[T]he standards for establishing standing under
[Business and Professions Code] section 17204 and eligibility for restitution
under section 17203 are wholly distinct.” (Id. at pp. 335-336.) Higbee is
inapposite.
      Plaintiff also argues that awarding compensation for business that has
been diverted by a competitor is consistent with the Legislature’s intent to
curb unlawful or unfair business practices. But the court’s equitable powers
do not permit it to “award whatever form of monetary relief it believes might
deter unfair practices.” (Korea Supply, supra, 29 Cal.4th at p. 1148.) And
although “[a]ll remedies have some incidental deterrent effect[,] . . . [¶] . . . [¶]
. . . [r]estitution is not a punitive remedy.” (Clark v. Superior Court, supra,
50 Cal.4th at p. 614.) That said, as the Supreme Court recognized in Korea
Supply (see id. at p. 1152), denying compensation for lost business to
plaintiffs allegedly harmed by a competitor’s unlawful or unfair business

                                         15
practices will by no means leave anyone without a remedy. “Injunctions are
‘the primary form of relief available under the UCL to protect consumers
from unfair business practices,’ while restitution is a type of ‘ancillary
relief.’ ” (Kwikset, supra, 51 Cal.4th at p. 337.) Plaintiff could have brought
suit to enjoin the unlawful practices at the time they were taking place. In
addition, consumers, who are the direct victims of LensCrafters’ allegedly
unlawful business practices, may potentially seek restitution. (See Korea
Supply, at pp. 1151-1152, 1153.) Plaintiff may not.
      Simply put, regardless of label (“lost market share,” “lost business
opportunity” or “lost profits”), a plaintiff cannot recover anticipated but
unearned, future income under the UCL in the guise of restitution because,
absent a legally enforceable right to that stream of future income, the
plaintiff lacks an ownership interest in it and thus there is nothing to
“restore.” To be clear, we do not reach the question whether a contractual
guarantee (or some other source of legally binding entitlement) would create
a vested property interest sufficient to recover unearned income under the
UCL, because no such interest has been alleged here and that issue is not
before us. We hold only that in the absence of any legal entitlement to future
income, anticipated but unearned future income is not recoverable in a
private action under the UCL even when it is characterized as “lost market
share.”
      In light of our conclusion it is unnecessary to address the parties’
contentions about the adequacy of the class allegations.
                                DISPOSITION
      The judgment is affirmed. Respondents shall recover their costs.

                                       16
                                          STEWART, J.

We concur.

KLINE, P.J.

MILLER, J.

Lee v. Luxottica Retail North America, Inc. (A157657)

                                     17
Trial Court:San Francisco County Superior Court

Trial Judge:     Hon. Mary E. Wiss

Counsel:

Quadra & Coll, James A. Quadra, Rebecca Coll, and Robert Sanford for
Plaintiff and Appellant.

Crowell & Moring, Emily T. Kuwahara and Gregory D. Call for Defendants
and Respondents.

                                     18