Elder v. Pacific Bell Telephone Co.
205 Cal. App. 4th 841
| Cal. Ct. App. | 2012Background
- Elder filed a 2009 class-action against Pacific Bell and OAN for cramming unauthorized charges on California telephone bills under Pub. Util. Code §2890(a).
- Plaintiff asserted causes of action for breach of contract (Pacific Bell), tortious interference, restitution/unjust enrichment (OAN), UCL, and unauthorized charges (2890) on behalf of a California class.
- Superior Court sustained defendants’ demurrers without leave to amend, ruling PUC had exclusive/primary jurisdiction; case dismissed.
- PUC had authority to regulate cramming and had issued General Order 168 and related decisions, but these did not grant exclusive/primary jurisdiction over private damage actions.
- Court reviews demurrers de novo, liberally construing the complaint; assesses whether pleading states actionable claims.
- Court reverses, holding the PUC has neither exclusive nor primary jurisdiction over this action, and the first amended complaint is sufficient to withstand demurrers; the case is remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the PUC has exclusive jurisdiction over cramming claims | Elder argues PUC does not have exclusive jurisdiction over damages for cramming. | Pacific Bell/ OAN contend the PUC exclusive jurisdiction applies. | No; PUC exclusive jurisdiction not established for private damage action. |
| Whether the primary jurisdiction doctrine applies to stay or dismiss | Action should proceed in court pending PUC input. | Matters involve regulatory policy; court should stay. | Not warranted; action may proceed without postponement. |
| Whether the first amended complaint states claims under §2890 and the UCL | Allegations show unauthorized charges and related damages. | Allegations insufficient or uncertain. | Sufficient to state §2890 and UCL unlawful practices claims; damages to be determined later. |
| Whether breach of contract claim against Pacific Bell is actionable at demurrer stage | Contractual obligation to bill only authorized charges. | Ambiguity in contract defense; may require further fact-finding. | Adequate pleading to withstand demurrer; merits to be resolved later. |
| Whether restitution/unjust enrichment against OAN is pleadable | OAN benefited from unauthorized charges. | Unjust enrichment claim not properly pled. | Adequate at pleading stage; final relief issues to be resolved later. |
Key Cases Cited
- San Diego Gas & Electric Co. v. Superior Court, 13 Cal.4th 893 (1996) (three-part test for jurisdiction over private utility actions)
- Hartwell Corp. v. Superior Court, 27 Cal.4th 256 (2002) (limits on court interference with PUC authority; primary jurisdiction considerations)
- Waters v. Pacific Tel. Co., 12 Cal.3d 1 (1974) (PUC jurisdiction and liability expectations in telecom)
- Gruenberg v. Aetna Ins. Co., 9 Cal.3d 566 (1973) (demurrer scope; test sufficiency of pleading)
- Cel‑Tech Communications, Inc. v. Los Angeles Cellular Telephone Co., 20 Cal.4th 163 (1999) (unlawful prong of UCL and borrowing other laws)
- Farmers Ins. Exchange v. Superior Court, 2 Cal.4th 377 (1992) (primary jurisdiction doctrine framework and policy considerations)
- People ex rel. Kennedy v. Beaumont Investment, Ltd., 111 Cal.App.4th 102 (2003) (statutory interpretation and deference to administrative findings)
- Shvarts v. Budget Group, Inc., 81 Cal.App.4th 1153 (2000) (pleading standards on demurrer; factual basis sufficiency)