Allergan, Inc. v. Athena Cosmetics, Inc.
640 F.3d 1377
Fed. Cir.2011Background
- Allergan sued multiple defendants under California UCL § 17200 for unfair competition related to PGF-containing hair/eyelash growth products.
- Allergan alleged injury such as lost sales, revenue, market share, and asset value due to defendants’ practices.
- The district court dismissed Allergan’s UCL claim for lack of standing, relying on the idea that restitution-only injuries were required under § 17204.
- Proposition 64 amended § 17204 to require injury in fact and lost money or property caused by unfair competition, but did not create a separate “business dealings” requirement.
- California Supreme Court decisions Kwikset and Clayworth later held standing can exist without restitution-eligibility, focusing on injury in fact caused by unfair competition.
- This appeal concerns whether Allergan has standing under § 17204 and whether the “business dealings” requirement applies; the Ninth Circuit reverses and remands.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does § 17204 require restitution-eligible injury to have standing? | Allergan argues injury in fact and causation suffice under § 17204. | Athena argues injury must be restitution-eligible. | No; standing requires injury in fact caused by unfair competition; restitution eligibility not required. |
| Is there a separate 'business dealings' requirement under § 17204 after Prop. 64? | Allergan contends no such requirement exists. | Defendants claim Prop. 64 imposes business-dealings limitation. | There is no business‑dealings requirement; standing rests on injury in fact caused by unfair competition. |
| Do Kwikset and Clayworth control the standing analysis here? | Kwikset/Clayworth support standing with injury-in-fact caused by unfair practices. | Legacy precedents requiring restitution-eligibility still cited by some. | Yes; Kwikset/Clayworth control, showing Allergan has standing under § 17204. |
Key Cases Cited
- Kwikset Corp. v. Superior Court of Orange County, 246 P.3d 877 (Cal. 2011) (standing requires injury in fact caused by unfair competition; no restitution eligibility needed)
- Clayworth v. Pfizer, Inc., 233 P.3d 1066 (Cal. 2010) (standing requires injury in fact caused by unfair competition; no restitution eligibility needed)
- Citizens of Humanity, LLC v. Costco Wholesale Corp., 171 Cal. App. 4th 1 (Cal. Ct. App. 2009) (overruled on standing requirements by Kwikset)
- Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134 (Cal. 2003) (discusses loss of money or property and restitution linkage)
- Buckland v. Threshold Enters., Ltd., 155 Cal. App. 4th 798 (Cal. Ct. App. 2008) (earlier standing requiring restitution eligibility (overruled))