De La Torre v. CashCall, Inc.
56 F. Supp. 3d 1105
N.D. Cal.2014Background
- Plaintiffs filed a class action against CashCall, Inc. in 2008 alleging California consumer protection violations.
- Class certification was granted in 2011.
- On July 30, 2014, the court denied CashCall’s partial/overall summary judgment and granted Plaintiffs’ motion addressing their UCL/unconscionability claims.
- CashCall sought leave to file a motion for reconsideration of the denial as to the Unconscionability Claim.
- The court granted leave and, after consideration, granted CashCall’s reconsideration motion, dismissing the Unconscionability Claim and granting CashCall summary judgment on the Fourth Cause of Action.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether UCL unconscionability claim is viable | Plaintiffs claim UCL allows restitution and injunctive relief for unconscionable loans. | Threshold question exists whether unconscionability can be asserted under the UCL at all. | Unconscionability claim not viable; threshold issue should have been addressed and court grants reconsideration. |
| Can the court fashion a remedy without intruding on legislative policy on interest rates | Equitable restitution could be awarded, potentially full interest refunded. | Court cannot set or alter interest rates or provide a remedy that encroaches on legislative domain. | Remedy cannot be fashioned without intruding on legislative policy; the UCL claim fails as a matter of law. |
| Whether reconsideration under Civil Local Rule 7-9 was appropriate | Rule 7-9 arguments were not fully considered previously. | New dispositive legal arguments were not properly addressed. | Court grants reconsideration and affirms dismissal of the Unconscionability Claim. |
Key Cases Cited
- Cel- Tech Communications v. Los Angeles Cellular Telephone Co., 20 Cal.4th 163 (Cal. 1999) (standards for when courts may intrude into economic policy matters)
- California Grocers Ass’n v. Bank of America, 22 Cal.App.4th 205 (Cal. App. 1994) (judicial intervention in setting economic policy is improper)
- Madrid v. Perot Systems Corp., 130 Cal.App.4th 440 (Cal. App. 2005) (restitution limitations under UCL context)
- Korea Supply Co. v. Lockheed Martin Corp., 29 Cal.4th 1134 (Cal. 2003) (UCL remedies limited to injunctive relief and restitution)
- Carboni v. Arrospide, 2 Cal.App.4th 76 (Cal. App. 1991) (unconscionability defense/defense to enforcement of contract)
- Harris v. Capital Growth Investors, 52 Cal.3d 1142 (Cal. 1991) (limits on judicial interference in economic policy)
- Lazzareschi Inc. Co. v. San Francisco Federal Savings & Loan Ass’n, 22 Cal.App.3d 303 (Cal. App. 1971) (economic policy considerations in lending contexts)
- McCormack v. Hiedeman, 694 F.3d 1004 (9th Cir. 2012) (overbreadth concerns in injunctive relief)
- Exxon Shipping Co. v. Baker, 554 U.S. 471 (S. Ct. 2008) (principles on not relitigating or raising new arguments)