*1 Dist., A097495.First Div. Aug. Two. [No. 2002.] CORBETT, Petitioner,
THOMAS THE SUPERIOR COUNTY, COURT OF ALAMEDA Respondent; AMERICA, N.A., al., BANK OF et Real Parties in Interest.
Counsel Law Offices of Wilson; Sharon Kinsey, Sharon L. Amanda K. Kinsey, Pianelli, McGehee & McGehee; Jack E. and Brad for Petitioner. Seligman Robinson, Calcagnie & Robinson and Sharon J. Arkin for California Con- sumer Health Care Council and Health Administration Responsibility Project Amicus Curiae on behalf of Petitioner.
The Sturdevant Law Firm and James C. Sturdevant for Consumer Attorneys of California as Amicus Curiae on behalf of Petitioner. Goldstein,
Saperstein, Demchak & Bailer and Laura L. Ho as Amici Curiae on behalf of Petitioner.
Van Bourg, & Weinberg, Roger Rosenfeld and Moscowitz for Ellyn District Workers, Council of Iron Northern California Council, Carpenters Regional Roofers Local United Assoication Local United Association Local 709, International Brotherhood of Electrical Workers Local 11 and Painters *5 District Council 36 as Amici Curiae on behalf of Petitioner.
Michael Rawson for Public Interest Law as Project Amicus Curiae on behalf
of Petitioner. Weiss Milberg Bershad Hynes & Lerach and William S. Dato as Amicus Curiae on behalf of Petitioner.
No for appearance Respondent.
Steefel, Weiss, Lee, Levitt & W. Barry Andrea Hackett and Henningsen Chad D. Bernard for Real in America, Interest Party Bank of N.A. Jackson,
Christa & Laura K. Christa and Laurence Jackson for Real in Party Interest Hayward Inc. Dodge,
Opinion LAMBDEN, us, J. In thecase before Thomas Corbett filed his (Corbett) for petition conclusion, relief extraordinary trial court’s challenging a 654 law, it for could not a class to claim certify pursue violating
matter section law Business and Professions Code (UCL), the unfair competition against et The struck the of Corbett’s portion pleading seq.1 America, N.A., Bank of Corporation, Bank of Bancamerica Auto Finance Dodge, America Bank of Corporation (collectively America), Hayward into a for of unlawful fluid disgorgement profits Inc. (Hayward Dodge) recovery fund. authority courts have the
Although presumed they numerous considered reviewing UCL claims as class actions2 courts have certify in must be considered when class a UCL lawsuit certifying what factors National Bank Cal.3d Fletcher Security (e.g., Pacific no court has appellate directly 591 P.2d (Fletcher)), Cal.Rptr. [153 51] whether UCL class actions are fundamentally addressed the question The us is therefore one of first question impression. before incompatible. however, the Supreme of America and maintain that Hayward Dodge, Bank Services, Cal.4th in Kraus v. Inc. Trinity Management this (Kraus) question 999 P.2d settled already 718] orders dis when it concluded that “section 17203 does authorize recovery into a fluid fund.” gorgement Kraus and UCL claims are do not holds class actions agree
We it Court in Kraus made clear exclusive. The mutually it had remedy, whether a fluid which recovery before was question actions, (Kraus, authorized UCL. “sanctioned” class also “the has The court concluded that Legislature Cal.4th p. 127.) in UCL authorized relief other than restitution monetary not expressly actions, fund but has authorized into fluid Thus, holding recovery remedy its barred (Id. liquid actions.” actions. actions and did not address class UCL non-class UCL Dodge and Bank of by Hayward of Kraus advocated interpretation *6 its earlier Court to disapprove required Supreme America would refer to Business Professions Code. unspecified 1All further code sections and Diego County Hayes Superior Court San certified example, Judge Charles R. 2For action, affirmed in Massachusetts Mutual a claim a class Fourth District UCL as Life (Mass. Mutual). Cal.Rptr.2d Superior Court 97 1282 Ins. Co. [119 190] addition, “True Actions Are leading a on the contains a section entitled Class treatise Advertising (Stern, Practices False Bus. & Unfair Business Permissible Under §17200[.]” section, 7.28, explains 2000) this (The Group Under Code Rutter Prof. 17200 § ¶ Angeles County Los distributes a department Superior Court of the class action “ necessary collective following: certification is obtain flyer containing the ‘Class assuming persons, process is satisfied. Class injunctive for absent due restitution and relief ” may “superior” only (Id. at obtain those remediesM’ not be in an action to certification 7.29, p. 218.) ¶
655 Fletcher, in Fletcher. In opinion Court Supreme ruled that a implicitly UCL claim could as a class properly action when it held that the trial court improperly class certification of a rejected UCL claim because plaintiffs could not that each prove individual borrower lacked knowledge the bank’s unfair practice. (Fletcher, supra, Cal.3d at Not p. 453.) did the Court in Fletcher, Kraus from quote but it approvingly pointed out that it had held in Fletcher already that “once an unfair trade established, practice a class action could proceed without individualized of lack of proof knowledge fraud.” (Kraus, supra, Cal.4th at p. Fletcher, added, italics citing Cal.3d at
In addition to the in Kraus language claims, of class UCL approving in the nothing of the UCL or in language its legislative history suggests UCL claims and class actions are incompatible. numerous modifi- Despite UCL, cations to the has Legislature never added language barring Furthermore, actions. section 17205 expressly that the remedies provides under the UCL “are cumulative to each other and to the remedies or penalties available under all other laws of this state.” Consequently, plaintiff a class UCL action is entitled to an expressly injunction restitution, UCL, authorized under the and to into disgorgement a fluid recovery, authorized under the class action statutes.
Finally, also public policy us to compels reject argument of Hayward and Bank Dodge of America. Refusing ever permit liquid in a UCL claim would thwart purpose the UCL because it would permit defendants to keep of their portion illicit profits (see, Bank e.g., West v. Superior 2 Cal.4th P.2d If a 545]). in a plaintiff UCL action was from precluded seeking disgorge ment into a fluid those recovery, ill-gotten profits could not be returned to identifiable injured or deceived would be parties retained the defend “ ants. This would ‘impair full impact of deterrent force that is ” essential if adequate enforcement’ of the UCL is to be achieved. (Fletcher, Cal.3d at p. 451.)
Accordingly, we hold that UCL claims and class actions are not mutually exclusive as matter of certified, law. Where a class has been properly plaintiff in a UCL action seek of unlawful into a profits fluid recovery fund.
Background *7 17, 2000, Corbett, On April and on behalf of all individually others situated, similarly filed a class action for complaint damages and for an 27, On injunction Hayward Dodge. August Bank of America and against 2001, class the court denied without Corbett’s motion for certifi- prejudice his for to set evidence in of motion. support cation failure forth 2001, filed third amended and August alleged On Corbett a complaint interest simple that he a motor vehicle under motor purchased five-year interest, and financed Bank of security by vehicle installment contract to the financing. America. According pleading, Hayward Dodge arranged that Bank of America had his loan approved applica- Corbett was unaware of 12.50 but Dodge tion an interest rate approximately percent, Hayward of for an interest rate of 17.50 Bank loan documents prepared percent. and shared the difference between the interest rate America Hayward Dodge of charged. Hay- and the interest rate Neither Bank America nor approved of this information to the consumer. Corbett Dodge any ward disclosed all on of himself and other consumers who had been similarly behalf alleged of business causes by misleading practice harmed this and deceptive Code, et for the Consumers Remedies Act violating Legal (Civ. seq.), § contract, fraud, interference with permanent injunc- intentional prospective (a)(2), violating tion under Civil Code section subdivision 17200 et (§ seq.). to, 19, 2001, filed a motion other Hayward Dodge among On September of seeking ill-gotten gains strike Corbett’s things, “allegations disgorgement competition as under the unfair that relief is recoverable profits, to court motion strike granted statutes.” On November to the claim under section 17200. The relief related prayer disgorgement for disgorge “Motion of strike Hayward Dodge prayer stated: of Business and Professions ment relief 5th cause action under related Services, Inc.[, Trinity Management 17200 is Granted. Kraus v. Code 116, 138, remedy is not a in and disgorgement 23 Cal.4th holds that supra,] Rather, allegedly ill-gotten profits Kraus holds that of disgorgement itself. restitution funds. is a insofar as it mechanism to remedy only permit [is] enter as orders (Court may may Business and Professions Code 17203 real or money ‘to in interest person any property, restore necessary of such unfair by competi have been means may acquired which personal, an order for restitution possibility This does not preclude tion.’) a borrower borrower to affected borrowers on charges interest improper to effect restitution. a mechanism disgorgement basis or use [¶] relief under obtain Business argument Plaintiffs’ they as a class action 17200 because that claim is plead and Professions Code cannot, law, certify pursue Plaintiffs as a matter misplaced. [a between There is distinction 17500], claim under sections 17200 and on a claim behalf bringing in a representative capacity a claim bringing
657 Kraus, 137, of a class. . . .” The court cited 23 Cal.4th at page that the Kraus court noted that the Legislature stated is aware of distinction between and class actions. The court continued: representative “Claims under 17200 are defined statute as [section] claims. . . . These representative claims can seek relief to equitable remedy acts, unlawful business they but are not direct claims seeking damages the alleged unlawful business acts. A can plaintiff pursue class action a direct claim asserting to obtain for the same unlawful damages alleged business acts for him or herself and all other who are persons similarly situated, but that direct claim is not the same as the claim under [section] cannot, law, 17200. The Court aas matter of a class to certify a claim pursue under 17200. . . .” [section] 26, 2001,
On November Corbett filed a renewed motion for class certifi- cation on all of his causes of action for his except UCL claim. On December 24, 2001, Judge Ronald M. Sabraw denied this motion on grounds ascertainable, class was not individual issues over common predominated issues, and Corbett was not typical putative class.
Corbett filed a petition for writ of mandate peremptory from the Novem- 8, ber 2001 law, order as a finding, matter of that he could not a class pursue action for the UCL. We violating issued an order to show cause.
Discussion Although courts generally deny writ relief Science (e.g., Applications Internat. Corp. Court Superior Cal.App.4th 1100 [46 Cal.Rptr.2d 332]; Omaha Co. v. Indemnity Superior (1989) 209 Cal.App.3d Cal.Rptr. a writ of mandate should 66]), [258 denied when “the issues are of presented great and must public importance be resolved Sacramento v. Hickman promptly.” (County 66 Cal.2d Cal.Rptr. 428 P.2d these criteria 593].) Clearly are present here. Our receipt numerous amicus curiae briefs underscores the impor addition, tance of this issue. In a conflict exists trial courts. currently among Sabraw, Judge the designated for Alameda complex litigation judge County, has ruled that UCL exclusive, claims and class actions are mutually while Charles R. Judge Hayes at Court of San Superior County has Diego Mutual, certified UCL claims for class action. Mass. (See, e.g., 1282; see also fn. 2 Judicial therefore ante) economy requires a prompt resolution this controversy.
I. Corbett’s UCL Claim unlawful, Section defines unfair unfair competition “any unfair, or fraudulent business act or untrue or practice deceptive, *9 .” the trial . . . The before us is whether misleading advertising question the for relief and in that request finding court erred striking disgorgement matter an claim cannot be as a class action as a competition pursued unfair erred, law. the should be for class apply of If Corbett permitted add to the disgorgement certification for the UCL claim and the language determine the the to this we examine case question prior To answer pleading. issue, UCL and history law on this the and of claims legislative purpose actions, the class expressly permitting class omission of any language UCL, the between the UCL procedure actions in and differences and proof and class actions. is there is no that a UCL claim absolutely dispute
We that emphasize a action and that the two have different distinct from class procedurally However, a the mere fact that differ does not mandate they purposes. fact, In as we infra, conclusion are discuss under they incompatible. 82,3 3 circumstances set forth in Code of Civil Procedure section proper goals a UCL claim as class action furthers the and purposes certifying both of these actions. underlying certification, we denying
When an order class reviewing granting reverse is based criteria or incorrect improper legal if order upon “ ‘ though may support “even there be substantial evidence to assumptions ’ ” Co. 23 Cal.4th Thrifty court’s order.” v. Oil (Linder words, 435-436, 448 2 P.3d “In other review we 27].) [97 certification, court for denial of class given the reasons trial by other denial.” Glendale grounds support (Bartold ignore any might Cal.Rptr.2d 226].) Federal Bank not be ruling If the trial court’s UCL claim could maintained flawed, remains as a action as a matter law is no other basis legally class sustaining court’s ruling. and UCL A. Case Law Class Claims Regarding Certification The most recent Court case address whether Supreme question Kraus, be is Cal.4th maintained as a class action may claim Court in Kraus argues implicitly approved 116. Corbett for UCL claims whereas Bank Hayward Dodge the Kraus and irrecon- contend that court recognized separate, America cilable, Civ. for a class action by Legislature (Code created procedures Proc., et and UCL claim 17200 382) (§ seq.). § who provides: section 382 “If the consent of one should 3Code of Civil Procedure obtained, defendant, may joined he made a the reason thereof plaintiff been cannot be interest, general being question one of a common or complaint; in the and when stated numerous, many impracticable bring it is them all persons, parties or when the court, for the benefit of all.”
before one or more sue or defend Kraus, 121-122, 23 Cal.4th six former tenants pages claims, UCL, number of one on behalf of themselves including under fund, the and absent for the into a fluid persons, nonrefundable and administrative fees collected the own illegal security ers and residential not seek They rental did property managers properties. (Id. certification of their UCL claim as a class action. *10 three a fluid involves
Supreme explained implementing recovery “ ‘ “First, the defendant’s total is over to a class steps: damage liability paid Second, fund. individual class members are afforded an to opportunity collect their individual shares their by proving usually particular damages, Third, to a lowered standard of residue after according proof. any remaining individual claims been is one of have distributed several paid practical ’ ” procedures that been the courts.” at developed by (Id. p. 127.)
The Kraus court stated that the had not Legislature expressly authorized a fluid in UCL recovery actions. 23 Cal.4th at (Kraus, supra, pp. Section 17203 the 129-137.) provides for UCL actions and it ex remedy authorizes pressly restitution as the After monetary remedy. reviewing UCL, statutory history of Court stated it Supreme that had found to nothing suggest Legislature intended to authorize a recovery fluid in UCL actions when it representative made the to order restitution power at statutory. (Kraus, supra, The court declared that section p. 132.) does not authorize into a disgorgement fluid and recovery, “[authority order fluid has its source in the recovery court when powers presiding action, over a class as now confirmed Code of Civil Procedure expressly section 384.” The (Kraus, supra, p. 133.) court held: section “[R]eading 17203 as orders for permitting disgorgement into fluid fund recovery be would inconsistent with the Legislature’s decision to authorize expressly fluid in class actions and to recovery that Consumers Rem provide Legal Code, edies Act et (Civ. suits on behalf of the seq.) plaintiff § other actions, situated consumers similarly as class not may actions, representative while to authorize failing fluid recovery represen Further, tative UCL actions.” (Kraus, supra, court stressed: sum, “In has not authorized relief Legislature expressly other monetary actions, than restitution in UCL but has authorized into a fluid fund in recovery class actions. is well aware of the Although Legislature actions, distinction between class actions and it has not done representative so for UCL actions. Inasmuch as the has representative Legislature spoken, further extension of the fluid should come from the recovery remedy not, as the dissent Legislature, argues, from this court.” (Ibid.) Court in Kraus stressed that the Although Legislature authorized fluid recoveries for class actions and did not do so for expressly UCL, the never be suggest court did not that fluid recoveries could Rather, action; in a UCL action was not indicated remedy presented. that courts retained the remedies authority liquid order Code pursuant certified the UCL of Civil Procedure section when had plaintiffs as a class of Civil section 382. The claim Code Procedure pursuant “Therefore, Kraus court added: we decline to read the grant equitable in section to fashion a fluid encompassing power authority when the action has not been as class action.“ remedy recovery certified Cal.4th at italics court further added.) explained (Kraus, actions, the action representative fluid when allowing action, has not been certified as a class due concerns may implicate process of a class action supervision serve the because public judicial (Ibid.) than that of a UCL action. greater We conclude that the Kraus *11 recognized procedural statutory hold, between and class actions but did not as the differences representative ruled, trial court that a action is with representative necessarily incompatible finds a class action. Our of the further interpretation majority’s opinion in Justice concurrence and dissent in Kraus. She dis Werdegar’s support the with to the extent barred a agreed majority’s holding liquid recovery actions, for uncertified UCL because UCL actions are formally private, often with class treatment. Cal.4th at incompatible (Kraus, supra, p. (conc. of was not the majority’s & dis. Her concern that opn. Werdegar, J.).) actions, UCL availability foreclosed the of a in all holding liquid that it would be available “in a critical class of UCL actions— but never (Id. 147-148.) at brought by unaggrieved plaintiffs.” pp. those personally Fletcher, Kraus, Court in 23 Cal.3d supra, Prior the addressed Supreme action a UCL claim. In 442 the of a class and question compatibility Fletcher, in a class under the UCL sought bank customers action restitution the bank the interest on the basis of because had annum rates computed per (Id. held for each at The court p. 445.) a loan. 360-day year separately suit, the certify the lower court used the basis refusing had improper could proceedings and noted that the trial court “determine subsequent as a class action is on precluded that the maintenance of suit present (Id. statement indicates following other at grounds.” actions under the did not consider class actions and court an action “Although may individual fundamentally incompatible: UCL pretrial of certification and potentially significant expense eliminate action, notice, to a class procedure and thus may frequently preferable court all adequacy representation the trial conclude of assured case proceeded borrowers would best be injured allegedly if discretion, its the trial court must exercising carefully class action. Before both the individual action and an weigh advantages disadvantages against (Id. and a class burdens benefits of suit.” proceeding underlying italics added.) Fletcher, and Bank America dismiss 23 Cal.3d attempts Kraus, cases that that Kraus with other predate arguing disagreed and Kraus essentially them therefore overruled them. did not overrule To the Kraus Fletcher. from contrary, opinion quoted extensively on Fletcher relied stated that it held in Fletcher already had expressly Fletcher, claim as a In could class action. proceed discussing court Kraus stated: “We a UCL from on distinguished claim claims based breach contract or fraud that once trade Fletcher], and held an unfair [in established, practice a class could without individualized proceed lack of proof fraud.” 23 Cal.4th knowledge (Kraus, supra, at p. Fletcher, added, italics citing 23 Cal.3d p. 450.) Similarly, Addiction, Stores, Court in Supreme Youth Inc. v. Inc. Stop Lucky 553, 582, Cal.4th footnote 3 950 P.2d stated: 1086] “Fletcher was as a class action. there that the might We stated or, order restitution to the if the class action was relief precluded, to an ancillary Cal.3d at injunction. 453-454.)” (23 pp. Fletcher, case Kraus, decided after before shortly
Court Bank Washington Mutual Superior Cal.4th *12 320, Cal.Rptr.2d 15 P.3d to (Washington Mutual) again appears [103 1071] the Mutual, of UCL In recognize class actions. appropriateness Washington the trial court had bank; certified nationwide class against action Court reversed because the to Supreme court had failed resolve choice-of- law issues and the different states’ impact applying laws on the unfair Mutual, practices business claim. supra, p. The court (Washington 927.) “Without that, stated: views on we expressing dispute, this note if trial court were to determine claims of residents be out-of-state must under states, resolved the unfair their practices business laws of own instead UCL, of California’s present appear then at such claims be outside 928, plaintiff’s] at fn. The scope complaint.” (Id. p. [the cautioned that it had not considered issues all of the involved with nationwide class action certification: “For determinations example, regard ing applicable may law affect issues other than predominance such or as whether have claims manageability, representative plaintiffs defenses of those of class or typical representative whether plaintiffs fairly can entire pp. interests of the class.” adequately protect (Id. The be 928-929.) Court never that proposed plaintiffs may law; from UCL claim as a class action as a matter of precluded pursuing rather, it held that the trial court must consider the factors set forth in Code
662 determining Civil Procedure section 382 when appropriateness certification.
class be without whether UCL suits Similarly, directly addressing may actions, as class several Court of decisions have Appeal presumed implied that claims class actions in cases. In bring UCL plaintiffs may appropriate 758, 211 Inc. v. Court Cal.App.3d Dean Witter Reynolds, Superior held the lower court (Dean 773 our division Cal.Rptr. Witter), 789] [259 class action by permitting proceed by abused its discretion the UCL action not class demonstrably when the had established that treatment was plaintiffs individual, “The to an action. The court superior representative explained: for action be the unfair claims class treatment must suitability competition statute, under the class action Code of by general tested principles developed Witter, 382.” fn. (Dean omitted.) Civil Procedure section Fletcher, the Fifth Wine Co. both Dean Witter and District Bronco Citing 720 Frank A. Farms (1989) Cal.App.3d Cal.Rptr. Logoluso [262 reversed a that awarded restitution awards under UCL judgment 899] that, not to the action. The court suggested who were growers parties are not as to binding because unfair business actions judgments nonpar ties, individual, to maintain an improper In Norwest unfair outside the confines of a class action. competition (Ibid.) Inc. v. Superior Mortgage, [85 the Fourth District an order a nationwide 18], certifying reversed claim, in a because nonresidents of included a pleading court, however, specifically not assert UCL claims. California could that it the certification order without reversing prejudice, stated this class to claim. certify (Ibid.) could move new plaintiffs pursue Inc. Payne v. National Collection Systems, (2001) Cal.App.4th successfully the court UCL actions Cal.Rptr.2d 260], prior held the Los District by Angeles County General and prosecuted Attorney no did bar a UCL class action who received Attorney plaintiffs *13 the or relief in the on behalf of monetary brought People. restitution actions the class though res did not even judicata apply The court held that Attorney General and by on the same conduct premised litigated District Angeles County Attorney. (Ibid.) Los the trial Fourth District considered a claim that
Most recently, had case that the defendant alleging certified a class action in a improperly Mutual, Remedies Act. Legal (Mass. violated UCL and the Consumer in did not assert The defendant Mass. Mutual supra, 91 Cal.App.4th action, argued only as a but that a UCL claim could not be maintained failed to in that case because plaintiff that a class could not certified 382. Civil Procedure section (Mass. of Code of satisfy requirements Mutual, at The Court of affirmed the lower court and supra, p. 1287.) Appeal UCL claim common and factual legal held that “plaintiffs’ presents treatment as a class action.” (Id. issues which were suitable plainly for 1292, italics added.) conclude that a trial court a UCL claim as a class action may certify We of section 382 of the Code of Civil Proce- statutory requirements when met. dure are
B. and UCL and Class Actions Legislative History Purpose of and Bank of America contend that the of the
Hayward Dodge purpose UCL, 172044; which is on behalf of the see also brought public (§ People 20, Land Research Co. 20 Cal.3d Cal.Rptr. Pacific action, P.2d is distinct from that of a class which is on behalf 125]), in private litigants. maintain that our Fletcher has They Supreme this distinction and has that these two recognized emphasized separate Kraus, are mechanisms each to be their effect. given separate (See Cal.4th at A brief review statutes legislative history the UCL and class governing actions reveals that their histories procedural distinct, but not incompatible. 1. The UCL Kraus,
Our
Court set forth the
of the UCL in
legislative history
summarize
129-131,
23 Cal.4th at
which we
here.
pages
briefly
“
Former Civil Code section
enacted in
‘Neither
provided:
law,
nor
relief can be
in
specific
preventive
enforce a
granted
penal
except
”
nuisance,
a case of
nor to enforce a
or
in
penalty
forfeiture
case.’
any
amended the
Legislature
statute
1933 to retain the
and
original provision
relief,
added an unfair
to the limit on
which
competition exception
injunctive
became subdivision
and
unfair
express authority
enjoin
competition,
which became subdivision 2.
Subdivision
(Kraus, supra,
pp. 129-130.)
“
defined unfair
as an ‘unfair or fraudulent business
competition
practice
unfair, untrue or
act
Penal
misleading advertising
any
by
denounced
provides:
any
chapter
4Section
pursuant
pros
“Actions
relief
to this
shall be
exclusively
competent jurisdiction by
Attorney
ecuted
in a court of
General or
district
attorney
attorney
any county
by agreement
or
counsel authorized
with the district
ordinance,
involving
county
any city attorney
city,
city
actions
violation of a
of a
or
750,000, and,
county, having
population
of the district
in excess of
with
consent
or,
attorney, by
city
any city having
city prosecutor
prosecutor
a full-time
with
*14
by
city
county
attorney,
city attorney
any
consent of the district
a
in
in the name of the
upon
any
people
upon
complaint
complaint
of the State of California
their own
or
the
of
officer,
board,
by any
acting
the
person, corporation
person
or association or
interests
itself,
general public.”
its members or the
” (Kraus,
130,
654a,
Code
654b or
Stats.
citing
sections
654c.’
p.
953, 1,
1933,
5 included
in the
2482.)
acting
ch.
“Subdivision
p.
person
§
the
the
to
an
general
among
bring
interest of
authorized
public
persons
130,
953,
1933,
action for an
Stats.
ch.
injunction.” (Kraus, supra, at p.
citing
1,
1972,
used
until
the
p. 2482.) Primarily
by public prosecutors
§
Court in
v. Merchants Collection Assn.
The amended Civil Legislature 1005, 1, restitution. ch. to the courts with to order p. 2378) provide authority § (K the 23 Cal.4th 130.) following year, Legislature raus, the law from Civil section 3369 and competition removed unfair Code 1, 2, it in the and Professions Code ch. placed (Stats. Business §§ who has 1202-1203). “Any person engages, Section 17203 pp. provides; engage enjoined or to in unfair be engaged, proposes competition may court The court make orders or may judg such competent jurisdiction. ments, receiver, to the of a as be including appointment may necessary which consti any person any practice the use or prevent employment by in this or be to tutes unfair as defined competition, chapter, may necessary or to in interest or real any person any money property, personal, restore means of such unfair acquired by competition.” which been may Thus, of section 17203 limited history express language ante, the relief to restitution and As discussed injunctions. majority available held in the or nothing statutory history language permitted Kraus fund restitution to other any person into a fluid or 23 Cal.4th at p. than direct victim of unfair competition. (Kraus, supra, Action 2. Class Liquid Recovery cy près concept
Probate Code section 15409 authorized expressly funds the next best use if the trust could purpose charitable trust putting Bruno v. until did California courts in no Not longer accomplished.5 123-124 Cal.Rptr. Superior Cal.App.3d 342] by beneficiary, provides: “(a) petition On a trustee or 5Probate Code section 15409 or modify dispositive provisions of the trust terminate may the administrative settlor, if, anticipated not owing to settlor and trust circumstances known substantially impair accomplish its terms would defeat or continuation of trust under case, purposes necessary carry if out the purposes ment the trust. In this the trustee to do acts trust, by the not authorized or are forbidden the court order restraining provision transfer of (b) trust The court shall consider trust instrument. [¶] making modify or terminate the its decision whether beneficiary’s interest as a factor *15 a fluid (Bruno) apply class actions. 23 Cal.4th at recovery (Kraus, supra, The Bruno court fluid explained purpose recovery: “The class theory fluid is that since each class member underlying recovery be suffered, cannot for the compensated exactly he or she the best damage alternative is to in a that benefits as of the class pay damages way many members as and in the possible that each member approximate proportion been has even most damaged, though, some class members probably, injured will receive no and some compensation not in the class people will benefit distribution; or, it, from the as one commentator states ‘where funds cannot be claims, delivered to those with precisely primary should legal money if be to the “next possible put best” use.’ (Bruno, supra, pp. [Citation.]” 123-124.) 1993, enacted former Legislature Code of Civil Procedure section
383, which authorized fluid recovery class actions. (Kraus, supra, Cal.4th 863, 2, at p. citing 4574; Stats. ch. see now Code p. Civ. § Proc., 384. “The 6) did not Legislature sanction fluid orders as an § available equitable power to the court in other proceedings.” (Kraus, supra, at p. 132.) 3. Comparing and the Language the UCL with the Purpose Class
Action Statute in the
Nothing legislative history suggests Legislature intended to prohibit class certification in connection with unfair competition Indeed, claims. Kraus did not suggest and, that such actions are barred as noted, already only declined “to read the grant equitable in section power 17203 as encompassing authority fashion fluid recovery remedy when the action has not been as class action.” (Kraus, certified Cal.4th at italics out, As Justice added.) section Werdegar pointed “ 17203 expressly authorizes courts to make such orders ‘necessary . . unfair prevent. . . . or competition as to restore may necessary to any trust, precluded but the court is not exercising modify from its discretion to or terminate the solely trust because of a restraint on transfer.” 6Code of Civil Procedure provides: “(a) Legislature section 384 It is the intent of the enacting unpaid this section to ensure that the litigation residuals in class action are distrib uted, possible, designed to the extent in a manner purposes either to further action, underlying causes of promote justice (b) or to for all Except Californians. . . . [¶] provided (c), prior entry in subdivision any judgment to the in a class action established pursuant to Section the court shall payable determine the total amount that will be to all members, if all paid they pursuant class members are the amount to which entitled judgment. (c) to the apply any brought against . . . This section shall not class action [¶] any However, public entity, abrogate any .... this section shall not be construed to equitable cy pres remedy regard which be available in part class action with to all or residue.” *16 (Kraus, interest . . . money (italics added) or
person any property’ Thus, a J.).) liquid recovery at & dis. of p. (conc. opn. Werdegar, authorized, the the be the of UCL did not bar may expressly not but language Further, relief Code 384. the authorized under of Civil Procedure section entirely relief forth in Code of Civil Procedure section 384 is consistent set UCL, be necessary with the broad of section 17203 in the provision may to achieve the of UCL in cases.7 purpose appropriate the remedies under section 17203 should Hayward Dodge complains that v. Air Filtration Cortez Purolator be cites not and Bank of America expanded Products Co. P.2d 23 Cal.4th 173-174 (2000) Cal.Rptr.2d [96 the notion that (Cortez) rejected as evidence that the Court has 706] compatible a scheme such is with recovery disgorgement profits fluid as trial court quotes following: may restitution. Bank of America “[T]he have make order for all benefits defendant received disgorgement may an to may from It order restitution failing pay persons overtime wages. been or unlawfully from whom or has obtained.” money property unfairly However, at omitted the (Id. conveniently Bank of America has p. 172.) where the Cortez court admonishes: quoted sentence section preceding a in a UCL action that is not as is recovery “Fluid not authorized certified class For that reason the trial not make an order may action. court Thus, . far from (Ibid., added.) of all benefits . . .” italics the Cortez opinion, again, Bank of America’s bolsters supporting viewpoint, a be in a UCL claim. class action position may asserts, not, only monetary in a 7The is the dissent whether the relief available question Kraus, opn., already has been settled in (Dis. post, UCL action is That restitution. Rather, may claim be a pages question is whether a UCL 23 Cal.4th 137-138. Indeed, action, remedy the class action statutes. permit which would authorized Corp. although Day T implies contrary, the dissent to the court AT & recovery incompat is suggest does not that a fluid 339 [74 55] Rather, recovery be points out that fluid in a UCL action ible with a UCL claim. unfairly com appropriate when the the defendant would have received but for amount it, explained The in the case before petitive practice “objectively is measurable.” cards, deceptive advertising people purchase prepaid phone there which to induce involved away ill-gotten profits Any respondents taken from for services were “no to restore. amount This, seen, using rebate. as we have is not provided properly filed tariffs would amount to a summarize, restoring something to the notion permitted.” (Ibid.) The court concluded: “To offending separate components. party The must competition a victim unfair includes two up given and the victim must have something to which it was not entitled obtained keep. charged by rates he was Because filed something which or she entitled correct, prepaid phone card obtains respondents presumptively a consumer who uses are nothing, he given up regardless of whether paid full was for and therefore has value of what attempt to purchase place. Any card first calculate improperly she induced to in the necessarily would purchased on those who cards monetary paid amount behalf of would enmesh for services. This properly result refund or collected fees in a rebate Appellants filed directly contravene the rate doctrine. rate-setting process court in the (Id. at money under section 17203.” not entitled to seek restoration The dissent’s contention that a fluid inconsistent with a class recovery UCL claim also on relies Justice Bird’s in State majority opinion of Califor nia v. Levi Strauss & Co. 41 Cal.3d 460 P.2d Cal.Rptr. (Levi Strauss). Levi Strauss court considered the doctrine in cypres 564] the class action context to the prior enactment of former section 383 of the Procedure, Code of Civil the first statute to authorize fluid in class *17 Thus, here, actions. it has limited relevance to the the issue but opinion’s logic our conclusion as supports follows: “The of fluid in propriety recovery case its in particular depends usefulness the of the upon fulfilling purposes underlying cause of action. . . . Fluid be essential recovery may [Citations.] to ensure that the of policies disgorgement or deterrence are realized. Without fluid defendants be to retain ill recovery, permitted [Citation.] their gotten gains simply because conduct harmed numbers of large people in small amounts instead of small of people large numbers amounts.” Straus, (Levi supra,
Although the has Legislature authorized into a fluid recovery fund class actions and in consumer actions under the Consumers Kraus, Remedies Legal Act (see Cal.4th at this does not p. 137), mean that class UCL claims cannot include fluid relief. As recovery already stressed, the Kraus court does not that the suggest doctrine would be cy pres Indeed, barred if the plaintiff were a class UCL claim. bringing such a would be holding intent, to the directly contrary Legislature’s clear as set expressly forth in section 17205. Section 17205 “Unless oth- provides: erwise the expressly provided, remedies or this penalties provided by chapter are cumulative to each other and to the remedies or available under penalties all other laws of this state.” the statute relief Accordingly, authorizes set forth in other statutes and does not exclude which is liquid recovery, available under another section.
Hayward and Bank of America maintain the Dodge fact that the UCL contemplates representative actions on behalf of the renders it general public class, inconsistent with the notion of a which is to benefit a limited designed however, number of see individuals. We in the nothing legislative history, indicating authorization of actions was designed fact, class, exclude class actions. In a UCL claim on behalf of the permitting when would further the the appropriate, of UCL. When the UCL purpose claim is not on behalf of a class and all the of the brought victims unfair located, cannot practice the in the company engaging unfair practice Thus, the monies that cannot be returned to the individual victims. the keeps retains some of the from its unfair and this company profits practice, contravenes the deterrent goal UCL. context,
In a different Court has declined to Supreme already permit defendants ato UCL action to retain their from their unfair profits gained Court, In at p. 1254.) Cal.4th
practices. (Bank Superior West v. West, Bank Court refused to companies violating allow it would the UCL to shift their loss to insurer because permit its to retain unlawful conduct. company (Id. proceeds court clarified: “Such a result would be inconsistent with act’s deterrent ‘ of the illicit ... purpose. permit portion “[T]o [retention even] that is if the full of the deterrent force essential profits, impair impact would to be One requirement enforcement is achieved. adequate law] [of such is a those policy engaged pro enforcement basic who ’ ” scribed all therefrom.” profits flowing (Ibid.) conduct surrender
If, action, however, the monies UCL claim total fund, to be can be in a thus preventing fluid disgorged placed from its obtained company wrongfully profits. many from benefiting *18 actions to have committed unfair can be practices pre- defendants found if the has retaining proceeding vented from obtained wrongfully profits manner, been as a action. this the of purpose liquid certified class a Bruno, 123-124, recovery, pages as described in 127 Cal.App.3d and, circumstances, furthers the deterrent complements appropriate under of the UCL. purpose of the or its
Absent the text UCL language legislative history suggest- to can as a action or reason UCL claim never maintained ing of the believe class certification would obstruct seeking purpose UCL, restriction, we to such a which would usurp power decline impose not Legislature, to the courts. belongs Permits a UCL Class Action C. No Statute Specifically not Bank of America that the did Hayward Dodge argue Legislature claims, intend UCL because otherwise would permit specifically of the with in section 17204 They language for it. contrast provided Act that in Code 1752 of the Consumer Remedies Legal Civil section (CLRA). this title
Civil of CLRA reads: “The of provisions Code section 1752 herein of section any are not exclusive. remedies for violation provided title be in this for section of this shall any of title or conduct proscribed by conduct other or remedies violation or any any addition to procedures in this title shall limit other any for in other law. provided any Nothing [¶] or other any law General statutory any rights Attorney or common Class consumers under class actions. actions person bring this with Section of provisions Chapter (commencing 1770) specific title shall be governed exclusively by provisions Chapter (commenc however, so with Section this shall not be construed ing 1780); deprive a class action consumer common law any statutory right bring resort If title without to this title. act or under this practice proscribed constitutes also a cause of action common law or a violation another statute, consumer assert such common law or cause statutory action under the and with the remedies for in such law.” procedures provided and Bank of no
Hayward Dodge America such argue language class actions authorizing appears the UCL. Since the did not Legislature statute, include this when it language repeatedly Hayward amended maintains Dodge that it did not intend to class actions for UCL. permit however, This one of argument, ignores reasons for the probable Legislature’s of a class action in the CLRA. specifying permissibility The statutory authorization for class action in the CLRA is Civil unique. Code section 17818 a class action governs under CLRA rather than the more general provision Code of Civil Procedure section 382. e.g., (See, Caro Procter & Gamble Co. 644, 655, fn. 6 Cal.Rptr.2d 419].) Since the intended Legislature specifically Code of Civil Procedure section 384 CLRA, to the it had apply *19 8Civil provides: “(a) Any bring Code section 1781 consumer entitled to an action under method, act, may, practice Section 1780 if the unlawful damage or has caused to other situated, similarly bring consumers an action on behalf of himself and such other consumers damages to recover provided (b) or obtain other relief as in for Section 1780. The court [¶] permit shall the suit to be represented maintained on behalf of all members of the if all class following of the (1) impracticable bring conditions exist: It is all members of the class [¶] (2) questions before the court. substantially The of law or fact to the common class are [¶] predominate questions similar and over the affecting (3) the individual members. The [¶] claims or defenses of the plaintiffs typical of the claims or defenses of the (4) representative plaintiffs fairly class. The adequately protect will the interests of the [¶] [¶] [¶] (e) . required by (d) following: class. . . . . . The notice subdivision shall include the [¶] (1) The court requests by will exclude the member if notified from class he so a not, specified judgment, date. The whether favorable or include all will members who [¶] exclusion, request do not Any request may, exclusion. member who does not if he [¶] desires, dismissed, appearance through (f) enter an counsel. A class action shall not be [¶] settled, court, compromised approval or proposed without the and notice of dismissal, settlement, or compromise given shall be in such manner as the court directs to given pursuant (d) each member who was notice request to subdivision and did not exclusion. [¶] (g) judgment The in a class action shall describe those to whom the notice was directed requested and who have not exclusion those the court finds to be of the class. members possible judgment given The best notice of the shall in be such manner as the court directs to personally (d) each member who was pursuant served with notice to subdivision and did not request exclusion.”
670 a action be and the that class specify requirements it under the CLRA.9
bringing ante, nothing suggests As discussed UCL Code Civil 384 to the UCL. To the apply Procedure sections 382 and should not Fletcher, supra, the UCL has been amended since contrary, repeatedly fit 442, and the has never seen to interfere with the Legislature Cal.3d Fletcher, UCL claims in practice, certifying appropriate common since ante, cases. fn. As discussed Code Civil Procedure section (See ante) “distributed, shall be to the residuals provides unpaid in manner either to further possible, designed purposes extent action, . .” or to for all Californians . . underlying promote justice causes of UCL, which This statute is consistent with section 17203 of authorizes to deter unfair “may necessary” competi “such orders as judgments” Further, tion or to restore its interested proceeds persons. already stressed, states that its remedies are cumulative and do the UCL expressly is a statute and the class others UCL substantive displace (§ 17205). collectively is a device for substantive litigating action statute procedural no Legislature each other and the had complement claims. The statutes is permitted and/or class certification reason fluid specify with a UCL action.
D. and Procedure Differences Proof for a UCL claim contends that a class action Dodge permitting
Hayward and unfairly a swift UCL suits goal permitting remedy would thwart of proof. because UCL claims lesser measure require defendants prejudice Witter, Cortez, 173-174, Dean Cal.4th at (See, e.g., pp. quoting compensa- ‘The of claims for exclusion Cal.App.3d [“ overarching also consistent with the tory damages [in claims] streamlined for the concern to legislative provide procedure prevention *20 To individual permit or threatened acts of unfair competition. ongoing to be as of such a pursued part procedure claims for compensatory damages the court to deal a requiring to this with objective by would tend thwart of issues of a order of Consumers damage higher complexity.’”].) variety do not have to that been prove they actually a UCL action filing deceived, deceived; be the also do plaintiffs that are to simply likely but they the intended to injure anyone. (See, e.g., not need to that defendant prove plaintiff a proceeding under Code of Civil Procedure section plaintiff 9Unlike will required is to show that substantial benefit moving certify a class under CLRA not (Hogya Superior v. Court Cal.App.3d litigants to the court. result Thus, section the CLRA Cal.Rptr. 325].) unlike Code of Civil Procedure 134-135 [142 class will come forward require plaintiff probability each member does not show (Hogya, recovery. 134-135.) pp. separate portion his her claim to a of prove Fire Court 45 State Farm & Co. Casualty Superior 1093, 1102 Cal.Rptr.2d 229].) fails to how class certification would
Hayward Dodge identify actually harm the defendants other than by being required give up wrongfully true, noted, obtained It is profits. already obtained could be when the victims are not com
wrongfully profits larger However, identified. of the UCL is to pletely purpose deprive noted, defendant of these As profits. previously allowing “ defendants to retain of their illicit would the full any portion profits ‘impair ” of the deterrent is if force that essential enforcement’ impact adequate the UCL is to be Cal.3d at (Fletcher, achieved.10 p. 451.) fact, a class action for UCL claims not permitting may prejudice but benefit defendants. Judgments individual UCL actions Thus, not as to a defendant be binding nonparties. may exposed lawsuits and therefore reluctant to settle a case that will not be multiple final action, as to all injured With a class each member of parties. participating the class is a to the lawsuit and to the Class party court’s subject jurisdiction. action defendants can achieve final of the claims them. repose against we can
Finally, of the a class quickly dispose argument permitting streamlined action would thwart the intended the UCL. There procedure by is no evidence that the of the lower standard of in a UCL purpose proof Moreover, claim offset a class action. consequences prohibiting the streamlined to benefit the the consumer procedure designed public; would have to balance the burden and of a class action its expense potential benefit. with this alternative Providing plaintiff would UCL, obstruct nor would it on purpose burden place greater Moreover, the defendants. the court would only class certification permit when the benefits burdens. As our outweigh stated: an individual action eliminate the “Although signifi may potentially notice, cant certification and expense pretrial and thus may frequently action, a preferable procedure to a class the trial court conclude that the of all would best be adequacy representation allegedly injured [plaintiffs] assured if the case aas class action. Before its discre proceeded exercising tion, the trial court must both the and disadvan carefully weigh advantages of an individual action the burdens and benefits of a class tages against for the suit.” 23 Cal.3d at proceeding underlying (Fletcher, supra, 10Moreover, reality because is that often UCL actions will not be on behalf of class absent, plaintiffs “truly representative (Bartlett class members” must be unnamed *21 435, Village, (1978) Cal.App.3d Cal.Rptr. 392]), private while a v. Hawaiian Inc. 87 438 [151 aggrieved (Committee party standing has UCL even if he or she is not on Children’s Television, 197, 211, 783, Corp. (1983) Cal.Rptr. 215 Inc. v. General Foods 35 Cal.3d [197 660]). 673 P.2d
II. Individualized Issues Bank of America that the trial court the class acknowledges rejected law, a certification of UCL claim as matter of but contends that court’s order should be affirmed on the alternative basis that individual factual class action It predominate, making inappropriate. argues issues a that the must be if trial is on any order affirmed court’s action correct Cohen v. Assurance legal (See, e.g., Equitable theory. Society (1987) Life 669, 673 J.B. Inc. American Cal.App.3d Cal.Rptr. 84]; v. Aguerre, [242 6, Co. 15-16 Liability Guarantee & Ins. 59 Cal.App.4th [68 Cal.Rptr.2d 837].) cannot, 2001, the trial “as a
On November court ruled that Corbett law, matter of class to claim sections 17200 and certify pursue under [a There is a distinction between a claim a bringing 17500]. a claim on behalf of a class.” On November
capacity bringing Corbett filed a motion for on all of causes of renewed class certification his court, 24, 2001, for his UCL claim. The on December denied except ascertainable, this the class not issues grounds motion on individual issues, not of the over common and Corbett was predominated typical class because he neither read the contract nor recalled putative financing transaction.
Bank issues to the claims of America factual related other argues 24, 2001, set in the dated to the apply forth order December equally on other is not disagree. certify UCL claim. We The refusal to claims certified, the UCL on whether the UCL claim should because dispositive claim different from other causes of action. Relief under materially reliance, and deception, UCL is available without individualized proof Mutual, (Fletcher, 452-453; Cal.3d at Mass. injury. pp. with to its Much of the court’s
Cal.App.4th reasoning respect causes upon refusal a class for non-UCL of action focused certify individual each class member knew reliance—what problems questions each would acted had the differently person and whether member UCL, not show known of the dealer reserve. Under the need plaintiff with reliance and therefore certification injury many problems or here. (See, Superior the other Prata relating apply e.g., claims 296] [“[U]nder UCL, need not that members prove a representative plaintiff deceived, sus practice, were relied fraudulent actually upon public tained damage.”].) tort between claims and other
Since the manner of differs proof claims, with problems not in whether determine position we *22 claims a class as to the other to the UCL certifying any applicability certified, no as to a class should be since claim. We whether express opinion However, the trial court is better suited to address this issue. the trial court erred when it that Corbett not a class action for the UCL ruled bring claim as a matter of law.
Disposition Let a writ of mandate issue court to peremptory directing respondent UCL, vacate its order to consider a class action under the and to refiising consider further of this matter in with the views accordance disposition herein. Costs are awarded to Corbett. expressed
Kline, J.,P. concurred. HAERLE, J. dissent. I majority’s believe I respectfully opinion for a of reasons. wrong variety Actions,
I. Actions and UCL This Irrespective Class Compatibility Petition Be Should Denied
A. This Is an Case Writ Inappropriate Relief us,
When the first came before I dissented from the present petition issuance of the order to show cause and took somewhat unusual step (in this court I said: would not have anyway) stating why. granted “[I] because, order to show cause the trial court’s December [my] opinion, 2001, order on several different motion for denying, grounds, petitioner’s class certification of all causes of action remaining (including portion if the fifth cause of renders the action) present petition substantially moot.” entirely
Some of this case procedural background may help explain my prior—and continued—concern. The initial cause of action under complaint (minus any 2000. the unfair law was filed competition (hereafter UCL)) April later, Almost months motion for class certification was petitioner’s but, order, denied1 in the he leave to file a third amended same was granted later, us Three he filed such a one before complaint. days complaint, us, was of 1Although presumably the matter is not clear from the record before this denial provided party. us complaint, a motion related to a second amended a document not *23 674 It fifth cause action under and Professions Code
here. added a Business 17200.2 section 19, 2001, defendants, Inc., the Hayward Dodge,
On one of September words and from one phrases para- filed a motion to strike certain specific cause of and one of the paragraph complaint’s fifth action graph alia, for the inter that neither forms of relief ground, prayed relief on prayer are under the UCL. On Novem- permitted for and (disgorgement restitution) order ber the trial court issued its and partially granting partially motion as it to strike 8 It (November order). granted motion denying related to the relief of but denied disgorgement regarding restitutionary relief. it struck from 71 of fifth cause action Specifically, paragraph to relief and nine similar words from words eight relating disgorgement relief, That, for a total of words. complaint’s prayer paragraph that, the sum the November 8 granted by total of relief only order, the before us. being challenged by order petition two for its order.
The trial court offered
distinct
separate
justifications
Services,
was,
alia, that
Kraus v. Trinity Management
The first
inter
under
Inc.
The trial first rationale for its order was conceded expressly court’s motion to strike. Hayward Dodge’s his opposition petitioner counsel stated: referenced by majority—petitioner’s pleading—not analysis with disagree Hayward Dodge’s do not with defendant “[P]laintiffs Court’s decision in Kraus on effect of California respect Kraus, are California courts no their claims for of funds. After disgorgement or unlawful ill-gotten orders gains able issue for longer to a through pursuant strictly representative, their equitable powers profits under 17200.” non-class action claim Section order, the issuance of November
Just a of weeks after couple causes of certification of his other four filed a motion petitioner to the and Professions Code unless subsequent statutory references Business 2All noted. otherwise action.3 This motion was denied on December (December its several: “the class as The court’s reasons for denial were order).4 overbroad,” defined is had made an inadequate showing (2) petitioner because, fact, common was not “typical” questions (3) plaintiff he contract and did financing to his own never read according testimony, *24 not recall the The trial court to by declining grant transaction. concluded leave to substitute in a or . . . because the claims “typical plaintiff plaintiffs at issue could not be certified for class treatment if a ‘typical’ plaintiff even could located.” so, order,
This was to the December 24 for the according two reasons: (1) first, second, motion “to a class to the third and only sought certify prosecute fourth causes of action in the it had third amended complaint” (2) held, order, its previously via November “cannot petitioner certify class to the fifth cause of action under Business and Professions Code pursue 17200.” The order’s denial of class certification was expressly [section] “without to Plaintiff a further for class certifi- prejudice making application cation,” that, the of the to in to although language order seems order suggest motion, achieve class certification the via future will have petitioner substantial burden of then the discovering and evidence of presenting requi- site common of law and fact. questions later,
A 18, 2002, it, few weeks on January filed this petitioner petition. Indeed, he attacks the November 8 order the motion to strike. only granting he did not even the December 24 bring order to our attention. That important America, document was to us Bank of supplied N.A. respondent exhibits filed with its to the opposition petition.
Let me then summarize which procedural posture majority elects to on of class action and relief under opine availability procedures the UCL: motion to strike a few (1) Hayward Dodge’s only very was from a in the fifth cause of action and specific phrases single paragraph relief; another in the for that motion was paragraph prayer (2) granted only as to the as to those words to relief and denied pertaining 26, 2001, apparently 3This motion was filed on November but it is not in the record before Thus, only description provided by us. we are left it the trial court in its December with 24 order. implicate petitioner’s 4This second denial of a for did not UCL motion class certification this; majority acknowledges says point, petitioner cause of action. At one it “filed a except renewed motion for class all of action for his UCL certification on of his causes ante, ante, however, 657; Later, (Maj. opn., p. maj. opn., p. claim.” see also at it by seeming (partially granting confuses matters to characterize the order under review ante, granting (Maj. strike) denying opn., motion to as “an order class certification.” 658. court, relief; his to the trial implicating restitutionary (3) pleadings justi- conceded that words was petitioner striking disgorgement-related Kraus; fied trial “no under court’s class action under section 17200” (4) rationale one of offered its even justify ruling; (5) if, was two rationale, certification is for causes contrary appropriate action, on the record it the trial would almost certainly before come to the same conclusion of class certi- regarding inappropriateness fication for fifth cause of action because of absence common law the order petitioner; (6) and fact questions non-typicality the motion strike was filed motion for class granting any partially before filed; certification relating aspect operative complaint filed, action; when such a motion was did UCL cause of implicate except eight the UCL cause of action survives in all respects *25 words; to again free move disgorgement-related (9) petitioner expressly certification, of for class but will to do so on basis clearly all of of and fact as-yet-undisclosed questions plus, evidence common law likelihood, a more than this plaintiffs plaintiff “typical” petitioner. find
In this I this one of case light background, singularly inappropriate “It of a writ. is well known that writ relief is deemed grant rarely We see and we ‘extraordinary.’ deny majority petitions vast of we the most for denying fundamental reason explain why. reality, perhaps writ relief is the case is still with the trial court and there is a likelihood good error will be either mooted or the time of purported by judgment.” cured Internat. Court (Science Applications Corp. Superior (1995) 1095, 1100 Cal.Rptr.2d 332].) [46 of writ relief “The leading Another case states: concerning propriety of of demonstrates that courts large number writ will rejections petitions trial to and order of the second-guess every ruling use their scarce resources court, time nor in the when to do so would save neither aid particularly relief, if Writ it were granted resolution of lawsuit. [Citation.] [¶] hat, of at the justice of a would interfere an administration drop orderly with guard trial and levels. courts have been cautioned to appellate Reviewing ‘ ‘extraordinary’ to take “. . . too lax a view of the against tendency ’ risk of fostering nature . . .” lest run the they of writs prerogative [citation] trials, proceedings, of and trial courts with delay vexing litigants multiple to the in the court. appellate and adding delay judgment appeals pending otherwise, in ordinary ‘If the rule action every were [Citations.] [¶] in the trial court by he chose could halt the proceeding defendant whenever the action ordinary for a writ of applying prohibition stop progress an intermediate toward a until a tribunal judgment reviewing passed upon rule, had If courts would reviewing arisen. such were question innumerable cases be from courts to nisi tribunals.’ prius converted appellate Co. v. (Omaha Indemnity Superior Cal.App.3d [Citation.]” 1266, 1272 Cal.Rptr. 66].) [258 case,
In the there was a motion for class certification present never even action, the relevant cause of a motion to strike a few words regarding one motion regarding part relief. And that was prayed-for granted only The trial court’s later class certification for part. ruling denying petition- er’s other four causes of action suggested rather such would also clearly be the fate of the UCL cause state the record. given present However, that motion was also denied without prejudice petitioner expressly allowed discover evidence of common attempt questions law and fact. whether,
The admittedly
after Kraus and Cortez v.
interesting question
Purolator Air Filtration Products Co.
B. The Trial Court’s Order Is Under Its First Entirely Justifiable Rationale The majority’s confuses the order the court under opinion inexplicably of
review one of with the two reasons the for of that order. gave entry it that, so misses the doing, even the incorrectness of the point assuming order, trial court’s second rationale for that its first is conceded clearly—and by petitioner be—correct.
A basic one principle but overlooked appellate jurisprudence, is that an . . . order correct on be majority, “appealed will any theory even the trial court’s been affirmed, though erroneous.” reasoning may al., et Cal. Practice Guide: (Eisenberg Civil & Writs Rutter Appeals (The 8:214, “If the decision of a is Group 2001) p. 8-106.) lower court correct ¶ case, on of law to the be any theory or order will applicable judgment affirmed of the correctness of the regardless grounds upon which lower court reached its conclusion.” Davidov v. Issod 78 (Mike (2000) 597, 610 see In re 897]; also Cal.Rptr.2d Marriage Burgess (1996) [92 25, 444, Cal.4th 913 P.2d 473]; Campbell Cal.Rptr.2d Rappleyea [51 8 Cal.4th 884 P.2d 126].) notes, monetary
As the itself Kraus makes clear that “the majority only ante, in relief action is restitution.”5 at opn., p. available UCL (Maj. Kraus, held to direct fn. Others “In the court that restitution 7.) agree: The the UCL.” only remedy victims is the available under monetary (Karas, Role Fluid in Consumer Protection Kraus v. Trinity Recovery Litigation: Cal. Management (hereafter Karas).) Services L.Rev. 971-972 if ruling But there is doubt on this lingering point, dispositive Kraus as disgorgement liquidated reads follows: order “[T]he that fees be to the extent it damages/security only compels enforced And, former (Kraus, restitution to tenants.” Cal.4th earlier, and meaning only, the court defined “restitution orders” as meaning, an “orders defendant to return obtained money through UCL compelling unfair those in interest from whom the practice persons property business was taken.” (Id. pp. 126-127.) trial could states: “If the court’s claim ruling majority flawed, no
not be as a matter of law is legally maintained a class ante, at opn., other basis remains for the court’s sustaining ruling.” (Maj. all, First of it confuses flatly wrong This statement is for two reasons. one support trial court’s with of two bases articulated “ruling” Its that 17 should stricken from the third words ruling.6 “ruling” two is second complaint; majority criticizing amended what Second, sustaining stated bases the “basis remains for ruling. [that] for ruling” is, “Kraus holds question: court’s the order quote it is is a insofar as disgorgement allegedly ill-gotten profits remedy . restitution of funds. . . This does permit preclude mechanism . mechanism to effect of . . the use of as a possibility restitution.”
I pose following respectfully questions: *27 8 the lower court’s November majority If the is so anxious to reverse
(1) we words restored ruling, just disgorgement-related shouldn’t order 17 But can that be after Krausl how complaint? order, the present If the case is to the trial court (2) pursuant returned it with its same order wrong issuing precisely what would be possibly (see post, 690-692), majority promptly 5Although, point pp. I at contradicts as out later marriage representative UCL aggressively permitting this it advocates statement when ante, 659-660, 667-668, 670.) recovery. (See, e.g., maj. pp. at opn., action and fluid says: It trial repeats dispository in its order. majority 6The this error conclusion “[T]he bring class for the claim as a it ruled Corbett not UCL court erred when refusing class its order to consider a matter law” and then orders that “to vacate ante, not 673.) trial court’s (Maj. opn., p. . . But that was action under the UCL . .” “order,” of it. explanation of the offered one bases language the same 17 words—but previously—i.e., striking omitting any did actions and class UCL concerning incompatibility representative and, instead, on its first-stated basis? solely actions order justifying Is C. The Petition Should Be Denied Because Petitioner Not “Typical” minimum, in the At the consideration of the issues addressed important should at least await a case in which record does majority opinion the trial court finding by include—as this record does—an factual explicit is not class status plaintiff seeking representative “typical.” that, It certifica- will be recalled its December class ruling denying court, action, tion to the first four the trial on relying causes petitioner’s own with the defendants’ conten- deposition testimony, agreed specifically tion that he “is not a because he “never read the plaintiff’ financing typical contract and does not recall the transaction.”
There is no to this in the record before us. challenge ruling by petitioner based, were, But even if there a trial denial of class certification e.g., court’s on is not or that there are findings that a putative typical fact, insufficient common of law or reviewable under questions generally an abuse of discretion Mutual e.g., Washington standard review. (See, Bank v. Cal.4th Superior 914 [103 Stores, Inc. P.3d Reese v. Wal-Mart (Washington Mutual); 1071] 1225, 1233 I submit there is no possible Cal.Rptr.2d 346].) basis for abuse of discretion in the trial court’s determination finding any is not class. This was the second time petitioner typical putative this trial court had entertained motion for class certification in this action and, it, examined the before clearly, including specifically record carefully petitioner’s deposition.
Petitioner they have an answer this: contend majority issue of under a far more liberal “typicality” will determined necessarily standard as and when a UCL claim is considered for class action status. (See, ante, at There are two with e.g., maj. opn., things wrong fn. in mind law on this the first UCL substantive proposition. place, bearing reliance, the lack of etc. damage, standing, post, p. 682), need (see correct, if and the it will mean that a petitioner majority “typical” be, class counsel dra- putative class action could plaintiff literally, anyone *28 Second, off the this standard was not the way petition- street. liberal goons addressed in a single paragraph er’s counsel pled typicality; topic all causes applicable his third amended words complaint expressly action. bases,
On these two it seems to me inconceivable that would petitioner ever be found even UCL claim could be certified as a class “typical” z/his reason, therefore, this action. For additional be denied. petition should
II. Class Actions and Actions Representative
Are Inconsistent Fundamentally the substantive issue of whether UCL actions Regarding representative from single and class actions are I start with a sentence compatible, case, of a a case footnote recent Court like ours very Appeal antedating both Kraus Cortez. Massachusetts Mutual Ins. Co. v. Superior Life 1282, 1290, Court fn. 3 (Mass (2002) Cal.Rptr.2d 190] [119 the court the whole “As Mass Mutual succinctly: matter Mutual), put very out, a UCL is from a representative under the different class points I I further. I agree, go action.” but would a bit believe differences under Code of Civil section 382 brought between actions Procedure section so substan UCL actions under 17204 are brought the two mutually tial that are inconsistent. course, Code of Civil
Of class action law neither totally procedural; 382, the of Civil section Procedure section later-enacted Code Procedure sections, nor case or those any interpreting purport lay applying UCL, contrast, down substantive standards.7 The contains both legal by substantive and Section 17200 is substantive provisions. procedural and 17204 the ones. principal procedural sections 17203 provision i.e., that a court unfair may enjoin competition, Section provides and, in “as may may of section order relief process, violation real or any money to restore to interest or necessary any person property, which been means unfair acquired by competi- such personal, the UCL then an action to enforce brought tion.” Section 17204 provides reads, It part: is one to enforce not private, rights. pertinent public, exclu- for this shall be chapter prosecuted “Actions relief pursuant or . . in a court General . jurisdiction by Attorney sively competent . .the general (Italics interests by any person acting public.” of. added.)8 under private In recent actions individuals years, groups Kraus, actions.” (See, e.g., section 17204 have been labeled “representative Altering provided actions as a means to enforce substantive law. 7“Class to confuse means with ends—to procedure law accommodate would be substantive 447, 462 goal (City Superior 12 Cal.3d going.” for the San Jose v. sacrifice 1223]; Burnham see also Vernon v. Drexel & Cal.Rptr. 525 P.2d 76 A.L.R.3d [115 147].) Cal.Rptr. Cal.App.3d Co. persons. provides “person” the term includes natural 8Section 17201
681 v. People In the case of supra 126-138.) leading 23 Cal.4th at pp. Pacific 20, 569 P.2d Land Research Co. Cal.Rptr. 20 Cal.3d (1977) 125] [141 Land the essentially “pub- Research), our Court described (Pacific Supreme seeking “An filed by People lic nature of a such an action: action good” a enforcement relief and is law fundamentally civil injunctive penalties The and not to benefit private parties. action to designed protect public to to continued violations of law and relief is purpose injunctive prevent from funds obtained. Civil illegally penalties, violators prevent dissipating to the are designed penalize which paid government [citations] defendant conduct. The for restitution on behalf illegal past request to the remedies only sought vendees such an action ancillary primary for the benefit of the restitution would benefit public. While [Citation.] obtained, the return of the such is not vendees money illegally repayment suit, of the as is in most class actions.” primary object private That even when the UCL action is analysis applies brought by private citizen. As one authors has written: “While B&P group knowledgeable section officials actions can be both representative brought by public no distinction has been made between the two private parties, types either the substantive of B&P section plaintiffs interpreting prohibitions 17200 or the or injunctive remedies available under section restitutionary 17203. Because dozens of court have considered reported appellate opinions law, settled, the lack of distinction is opinions section 17200 in cases officials are interpreting brought by public fully Greater al., Repre actions.” et applicable private representative (McCall Funds, sentation Consumers—Fluid Consumer Trust Recovery, for California Actions 816-817, Representative fn. omit L.J. Hastings ted.)
Quite our Four obviously, agrees. years ago, business large but also numerous amici curiae respondent, (including and California Chamber of General the court Attorney urged Commerce) to rule that could sue under UCL to enforce only “public prosecutors” minors. Penal Code’s ban on The this cigarettes rejected sales expressly declining judicially categorize potential “invitation request, to maintain UCL claims on behalf plaintiffs unqualified qualified has general public. Legislature expressly provided ‘any person’ suit, and—it need be noted—should hardly maintain such [citation] here, it free to our conclusion remains Legislature disagree provide with Stores, Addiction, Inc. Lucky Youth Inc. v. (Stop otherwise.” Kasky P.2d see also 1086]; Cal.4th *30 682
Nike, 296, 939, 45 P.3d Cal.Rptr.2d Inc. 27 Cal.4th 949-950 (2002) [119 243].) actions, are fundamentally UCL class actions
In contrast to or
tort
damages
least
to recover
seeking
usually)
actions
private
(at
citizens. In
situated
similarly
private
contract
a
number
by large
suffered
382,
be
there must
of Civil Procedure section
order to
under Code
proceed
of interest
community
and “a well defined
both “an ascertainable class”
(Daar
to be
parties
represented.”
of law involved affecting
questions
724,
695,
433 P.2d
Cal.Rptr.
67 Cal.2d
704
v. Yellow Cab Co. (1967)
[63
429,
23 Cal.4th
435
Linder
Oil Co.
732];
Thrifty
(2000)
see also
v.
[97
179,
“The
of interest
community
require
2 P.3d
(Linder).)
Cal.Rptr.2d
27]
common
of law
questions
three factors: ‘(1) predominant
ment involves
class;
or defenses
fact;
typical
class
with claims
representatives
(2)
class.’
represent
who can adequately
(3)
representatives
[Citation.]”
Mutual,
435; see also Mass
supra,
23 Cal.4th at
(Li
p.
nder,
supra,
“each
consideration is whether
Another relevant
Cal.App.4th
p.
his or her separate
ultimately
prove
class member will come forward
23 Cal.4th at
. . . .” (Linder, supra,
to a
of the total
portion
claim
“
trial courts
‘to
Court has instructed
our
435.) Additionally,
Supreme
p.
accrue
substantial benefits
of the class action
where
allow maintenance
”
Court
v.
Chip Stamps
Superior
and the courts.’
litigants
(Blue
both to
1. There is actual Similarly, been harmed. have to have does even plaintiff regarding nor reliance need not be shown to the plaintiff damages course, must, of be shown All of these things alleged misrepresentations. note, which, majority regret addresses. 9Practically I none of the class action; further, must damages “typical” the plaintiffs a class Stores, Addiction, Inc., Lucky Youth Inc. v. Stop to be represented. (See Research, 7; fn. 20 Cal.3d 567; p. Land Cal.4th at Pacific 832, 27 Superior Saunders States, Inc. Inc. v. Fisher Development, Union United Consumers 438]; Mutual, Mass 151]; Cal.Rptr. 1439-1444 *31 (1989) Cal.App.3d [257 968, 1288; Karas, L.Rev. at 90 Cal. supra, pp. 97 at Cal.App.4th p. supra, 979-980). generally and the of customers knowledge
2. The intent
the defendant
in
both
UCL
unimportant
the unfair
are
regarding
competitive practice
866,
v. Bank America
15 Cal.3d
876
(1976)
actions.
Chern
(See
[127
110,
that need be shown in UCL
544 P.2d
all
1310].) Additionally,
Cal.Rptr.
is
to deceive consum
likely
is that the
business
challenged
practice
actions
Television,
ers,
on Children’s
Inc.
not that it has
done so.
actually
(Committee
783,
197, 211
673
Cal.Rptr.
General Foods
35 Cal.3d
(1983)
v.
Corp.
[197
Mutual,
contrast,
at
660];
Cal.App.4th
p. 1289.) By
P.2d
Mass
97
supra,
in
“bear the traditional burden
class actions
fraud
plaintiffs
alleging
Mutual,
common
97
supra,
of victims of
law fraud.”
required
(Mass
at
actions,
in
3.
In
not so
damages may
sought;
representative
class
actions, the
relief
is restitution.
UCL actions. In those
(Ce
available
only monetary
Communications, Inc. v. Los
Cellular
Co.
Angeles
Telephone
l-Tech
163,
548,
527];
20 Cal.4th
973 P.2d
Bank
Cal.Rptr.2d
179
(1999)
[83
538,
1254,
2
West v.
Court
Cal.4th
1266
833
Superior
(1992)
[10
283,
P.2d
Court
9 Cal.3d
286
545];
(1973)
People Superior
(Jayhill)
[107
192,
1400,
507 P.2d
55 A.L.R.3d
Dean Witter
(Jayhill);
Cal.Rptr.
191]
211
Inc. v.
774
Reynolds,
Cal.App.3d
Superior
[259
object
And restitution “is not
primary
Cal.Rptr.
(Dean Witter).)
789]
Research,
suit,
as it is in most
class actions.”
Land
(Pacific
supra,
private
4.
numerous procedural
in
actions; no such protections apply
defendant from possible multiple
subject
UCL action is
UCL actions.
representative
representative
“[A]
. . . .” (Kraus, supra,
as a class action
judicial
the same level of
supervision
Research,
5. In class Proc., 384, (b).) Civ. subd. (Code sible and appropriate. § actions, is not UCL over and above basic restitution any disgorgement Kraus, 125-126, at 137-138.) 23 Cal.4th supra, available. (See pp. are in an
6. not recoverable under damages Punitive Cal.3d at class actions. supra, 287.) They clearly UCL. (Jayhill, p. is intended to a “streamlined provide procedure 7. The was and or threatened acts of unfair prevention competition.” (Dean ongoing Cortez, Witter, quoted supra, Cal.App.3d p. approvingly ex- “In contrast to the streamlined 173-174.) procedure 23 Cal.4th at pp. is ‘a of a class action Legislature, management pressly provided Witter, difficult and administrative task.”’ legal (Dean v. Hertz Corp. Cal.App.3d Lazar Cal.App.3d quoting Thus, class actions are many Cal.Rptr. 849].) ways, *32 because, UCL other among different from actions” “procedurally quite actions, of class “without the notice and certification things, requirements trial much to settlement or than class swiftly UCL suits move more may at actions.” 90 Cal. L.Rev. pp. 969.) (Karas, supra, actions, of UCL actions bind 8. class settlements “[Ujnlike private action, the not the entire class.” brought plaintiff (Karas, individual who 90 Cal. at supra, p. 969.) L.Rev. actions, no whereas in class requirement
9. There is notice receive notice of the lawsuit and would actions claimants would “potential and their entitlement to recovery have the to come forward show opportunity in a 90 Cal. L.Rev. at fn. (Karas, supra, p. 164.) amount.” particular course, insist determi- may, 10. A defendant in a class action of upon merits; on the of the class before an adjudication nation of composition UCL, if the seek has under the action does not he no similar even rights Research, Land 20 Cal.3d at (Pacific supra, restitution. differences, these cases with reported agree numerous several
Because are, indeed, of actions “different.” types (Mass Mass Mutual the two Mutual, For Hernandez example, fn. supra, p. 3.) 279], Finance Cal.App.3d Cal.Rptr. v. Atlantic Co. “ public, is an on behalf of general pros court noted: ‘Nor action action, be confused with class attorney ecuted aby private general, ” also, to the is required.’ (See to the representative plaintiff wherein damage States, Inc. v. Fisher effect, Development, Union United same Consumers Inc., Cal.App.3d court: Research, Mosk wrote for a unanimous And in Land Justice Pacific brought by People, actions protection do not that consumer agree “[W]e restitution, are the relief, equivalent civil seeking injunctive penalties the same safeguards parties, requiring class actions brought by private other harmful consequences. a defendant from suits and multiple protect [¶] the fundamental at Furthermore, . . lacks by . an [¶] People The Attorney of a class action filed a private party. tributes consumer files the action is ordinarily General or other official who governmental class, be public may a member of the his role as a protector so that he could not adequately inconsistent with welfare of their and defenses are not typical interests claims protect [citation] Research, 17-18, the class Land 20 Cal.3d at pp. (Pacific [citation].” fns. omitted.)10 in the remedy disgorgement
Most course of recently, holding collected monies into a fluid fund was not under wrongly recovery permitted UCL, to confirm the Kraus court used which seems wording as, indeed, It “Nonethe two forms of action “different.” wrote: regards less, section orders for into a fluid reading permitting fund would be inconsistent with decision recovery Legislature’s in class actions and to provide authorize fluid expressly Remedies Act suits on behalf of the Legal plaintiff Consumers [citation] actions, not other situated consumers as class similarly *33 actions, in recovery while to authorize fluid representative failing represen sum, tative UCL actions. has not authorized Legislature expressly [¶] actions, relief other than restitution in UCL but has authorized monetary into a fluid fund class actions. Although is class actions and repre well aware distinction between Legislature of actions, sentative it has not done so for UCL actions.” (Kraus, representative 23 Cal.4th at italics supra, p. added.) Kraus, from the of noted the dissenting holding
Even Justice Werdegar, “UCL actions often inconsistencies between the two of actions: many types treatment, must be as class formally plaintiffs are with incompatible while, absent, unnamed class members’ ‘truly representative [citation] has UCL the UCL’s broad remedial a purposes, private party with keeping he or she is directly aggrieved. whether standing regardless [Citations.]” at opn. Werdegar, J.).) 23 Cal.4th (Kraus, supra, p. (dis. Kraus, other is neither Cortez nor any
The that majority’s response is with a held that class action relief “incompatible” has precedent explicitly ante, brought by 681), clearly apply to both actions (see p. 10Asnoted above at these words attorney general.” (See, e.g., Stop Youth “private a a law enforcement official Addiction, Stores, Inc., 574-578.) Lucky pp. 17 Cal.4th at Inc. v. ante, 655, 658, 660, UCL action at opn., pp. 663) representative (maj. ante, the two of actions are exclusive.” at (Maj. types “mutually opn., p. I concede that there is no such I also concede the explicit precedent. 655.) that, a number of trial courts have majority’s point apparently, permitted UCL actions to be certified as class actions. But a combination of (1) Kraus, above, consideration of quoted language especially actions fundamental and differences between class many specific actions have listed several above—there undoubt representative (I convinces me that two actions are not “different” edly others) (Mass Mutual, at but fn. Cal.App.4th 3), incompatible. how just
A recent decision in a UCL action demonstrates representative pre one of the inconsistencies between these two of actions many types them. In Prata v. any overlap Superior cludes between of the Second (Prata), panel 296] District issued a writ of mandate court vacate an directing superior not under the order that could petitioner bring representative a bank for an and misleading marketing UCL against allegedly deceptive for a One of the financing credit-card campaign program. arguments defendant bank was not a petitioner representative proper because, he had other consumers other “refused among things, pay” finance hence “is entitled to individual allegedly improper charges and this that a (Id. rejected argument, noting restitution.” “ deceived, UCL violation ‘can be shown even if no one was relied actually damage.’ the fraudulent or sustained any (Id. p. upon practice, [Citation.]” in Prata consider what had been plaintiff But would happened class certification. Which would precedent apply, seeking body a class to have suffered damage typical requiring class or that that no such putative holding showing required *34 UCL UCL Similarly, precedent action? would representative representative if before the trial court was precedent or class action the issue apply And what suits after a or multiple judgment reliance? about from protection action of a action—which would law prior apply, settlement class/UCL or defendants from liability holding clearly protecting multiple Pacific do “the same Land Research that UCL actions not require from suits and other harmful protect multiple a defendant safeguards Research, Land Cal.3d at consequences”? (Pacific and when a UCL action certified majority strongly implies action, class action law otherwise inconsistent law. “trumps” as a class class action Thus, that UCL law should over prevail the majority suggests reliance, and injury” proof deception, “individualized regarding (1) law one key On the latter issue (a of the plaintiff. regarding typicality and more that the C., the majority strongly implies I. ante) in this case—see pt. at pp. 670-673.) control. (Maj. opn., liberal UCL standard will are, all, holding inconsistent with the majority’s first of holdings These in UCL class action.11 fund recovery into a fluid disgorgement approving trial for a nightmare create a procedural would Additionally, they clearly been already this has The instant case is a classic example: petitioner court. he causes of action. But suppose his first four regarding ruled “non-typical” the majority’s suggested for the UCL cause of action under is “typical” a case is a class The trial court then has to which try liberalized standard. an individual action to the as to one of causes of action but only five the huge does not majority perceive other four. I am perplexed in a bizarre inherent such evidentiary number of procedural problems countenance class certification majority situation. would Similarly, deception, in the absence of evidence of actual relief a UCL claim of action. Finally, both for all other causes although inappropriate would matter, I too envelope oral in this am argument clearly pushing after standard could well far liberalized by suggesting majority’s implied actions, the of law commonality questions to the core issue in class apply and fact.12 is a “representative
All of the assumes that the action at issue foregoing all actions UCL action.” There remains the of whether question first time our Court used phrase under the UCL are such. The Kraus, the term and said in the it footnoted UCL actions” “representative to refer to a UCL action the term action’ footnote: “We use ‘representative is the a private person plaintiff that is not certified as a class action which other than restitution on behalf a person and seeks and/or 126, fn. 10.) 23 Cal.4th at p. in addition to the (Kraus, supra, plaintiff.” can, indeed, there be a nonrepresen- This seems to suggest footnote to represent does not purport UCL action in which the plaintiff tative sues under is where a plaintiff One of such an action good. example public sums, more. this was nothing Exactly restitutionary the UCL to collect Inc. Systems, Collection recent case of National Payne sanctioned Another 1045-1047 91 Cal.App.4th 260]. handling of the fluid consistency majority’s 11There is one element of between *35 positions of its and class action law: both differences between UCL law issue and the other plaintiffs. are favorable to UCL of the action the issue argument, argued that in a UCL/class petitioner’s oral counsel 12At necessarily be more relaxed. commonality and fact would of issues law 688 a large group actual alleging injury typical is where a
example plaintiff statutes, them section among sues under multiple potential litigants but good only monetary an to enforce injunction public but does not seek of this sort of nonrepresentative relief of various types. Examples Mutual, Mutual. In Mass Mass Mutual and Washington actions well be of “van- had a particular type alleged they purchased several plaintiffs had, the defendant viola- life insurance and that policy ishing premium” Act, failed to Legal Remedy the UCL and the Consumers tion of both its to “ratchet down” policies plans of these purchasers disclose to Mutual, at p. 1286.) supra, Cal.App.4th on it. payable (Mass the dividend relief only sought from the opinion, as can be determined As far class action relief.13 monetary lender mortgage Mutual a sued single plaintiff
Similarly, Washington situated” on five causes of herself and all others similarly “on behalf Mutual, 24 Cal.4th action, the UCL. (Washington supra, one under including the court’s opinion, as can be determined from as far 906.) Again, class was monetary. on behalf of the putative relief sought Prata, for a unanimous court writing Justice Epstein, Significantly, be of two of section 17200 can that an action a violation alleging recognized cause of “an individual asserting action or one types: representative former, he suggested, supra, Cal.App.4th at p. action.” (Prata, brought the latter are those section while are those under 17203. (Prata, under section and clearly qualifies filed section 17204
The instant case was under two includes complaint para UCL action. The third amended representative alleges of the fifth cause of action Paragraph this clear. graphs making and Plain & Professions Codes that “Under Business §§ [sic] and on general public.” of himself tiff asserts on behalf standing behalf of this and “Defendants’ alleges: on from 72 follows added.) Paragraph (Italics restrained order of this conduct, by and enjoined unless and until unlawful I to the . . . .” submit public court, injury cause great irreparable will has—deliberately that this petitioner make clear allegations that these UCL action. a representative consciously—brought distinguishing point a careful why Mutual court made such may well be the Mass 13This noted, Prata, Prata, specifically it was a Cal.App.4th 1128. the case before from UCL,” noting that pregnant its footnote dropped it then action under the “representative Mutual, (Mass from a class action.” the UCL is different representative “a action under that a non- corollary this would seem to be 3.) The fn. UCL, i.e., of an brought—at partially—because least one action under the having standing, plaintiffs classic typical plaintiff or alleged of section 17200 violation 17204, may qualify for good to section well seeking public pursuant and not to enforce class action status. *36 relies on substantially the majority
In of its contrary argument, support Bank 23 Cal.3d National Security Fletcher Pacific case, the court held (Fletcher).14 591 P.2d Cal.Rptr. 51] restitution to recover seeking trial court erred in a class action dismissing under section to be lending alleged deceptive from a bank based on practices for reasons. I Fletcher is here several controlling 17535. don’t believe all, the court started articulating First of Fletcher was decided before long actions, as it actions and class the differences between UCL representative Second, more all importantly, did in Kraus and Cortez. and clearly probably each of in Fletcher held is that it was unnecessary majority opinion 50,000 class to have alleged per the over bank customers composing of the defendant sonal interest-calculation knowledge offending policy held bank for the case to as a class action. On that proceed point, order that “the trial court in the instant case determined that an erroneously of restitution under section 17535 must individualized predicated upon Third, of lack of 23 Cal.3d at knowledge.” proof (Fletcher, supra, less nowhere in Fletcher even mention section much majority did of a UCL action.” underlying Finally, citing nature “representative Kraus, the Jayhill seemingly holding decades-later anticipating Fletcher hinted that an action relief and strongly seeking injunctive majority as to a class action for the restitution relief could well be ancillary preferable 23 Cal.3d at pp. sorts claims at issue that case. (Fletcher, supra, 453-454.) it
Finally, notwithstanding all of this that our noteworthy Legislature, numerous amendments to the UCL documented has (well majority), never authorized class action relief under it. If the had wanted Legislature actions, somehow these two different it could have done so marry types It long ago. is not for this court to do so for now. Witter, Mutual, majority holdings Washington Mass Mutual 14The also cites our in Dean indicating disagree. impliedly overlap types as there is some between the two of actions. I holding plaintiff core of our in Dean that the UCL claims of that “should not Witter was
proceed such an action and a class action” because the fundamental differences between strongly suggested provide superior UCL action that a class action would never “a method for Witter, adjudicating (Dean Cal.App.3d competition the unfair claims.” Mutual, trial court Washington And in 24 Cal.4th a unanimous court held that the the court’s in a multi-cause of action case. The entire thrust of improperly had certified a class issues; nary a was said holding selection-of-applicable-law to choice of word related law among those certified for class about whether the inclusion of a section 17200 cause of action And, above, appears it Mass Mutual problem. not a as noted neither nor treatment or was Rather, both seem to action filed under section 17204. to have been a including brought by plaintiff and a cause of typical suits have been multi-cause-of-action monetary substantively seeking relief under section 17203. based on section 17200 and *37 690 UCL Class Are Ever
III. Even Actions and Actions Representative if Available Recovery Fluid Is Not Under the Compatible, concedes it “settled in At one in its that was point opinion, majority is Kraus” that “the relief available a UCL action restitu- only monetary ante, 666, fn. on tion.” But then to (Maj. opn., p. 7.) majority goes contend, fluid disgorgement indeed that into a quite aggressively, recovery fund would be available as and when a UCL action is certified as ante, 659-660, 667-668, e.g., action. (See, maj. opn., pp.
That
is
for two
and distinct reasons. First of
proposition wrong
separate
all,
Kraus,
it contradicts the
which
“For all of these
ruling of
reads:
express
reasons we conclude that section
does not
orders for
17203
authorize
(Kraus,
into a fluid
23 Cal.4th at
recovery
supra,
fund.”
disgorgement
p.
sentence,
conscious of this
wishes
137.) Although presumably
majority
it the
to
words “unless
action is certified as a class action.” But
append
nor,
that’s not what the Kraus court wrote
what meant. Kraus
plainly,
came to
conclusion
based on
well-established
just quoted
previously
the UCL
that
form of
relief available under
was
only
monetary
principle
Communications,Inc. v.
restitution.
Cel-Tech
Los
Cellular
(See, e.g.,
Angeles
Co.,
179;
at
Bank
v.
20 Cal.4th
the West
Telephone
supra,
p.
Superior
Court,
1266;
286;
As the trial in its recognized ruling striking disgorgement court in excess from the third amended allegations complaint, disgorgement Thus, in is in a UCL action. its con restitution unavailable on the issue the Kraus ruled: order for clusion disgorgement “[T]he fees be enforced only disgorgement liquidated damages/security “ (Kraus, tenants. to the extent that it restitution to compels former Kraus an Cal.4th at italics And defines order explicitly supplied.) UCL defendant to return restitution as one requiring “compelling money those in interest from through practice persons obtained an unfair business taken, is, who had an persons ownership whom property through interest in the or those claiming person.” (Id. pp. property this Kraus: not aspect fails to 126-127.)15 majority totally grasp entail, Day Corp. v. AT&T regarding 15For more what restitution does and does see Cortez, 55], pages 338-339 23 Cal.4th (“[R]estitutionary encompass quantifiable person sums one owes another 177-178 awards Addiction, Stores, Inc., supra, Stop Lucky Youth Inc. page Cal.4th at .”) . . . Baxter, J.). (conc. opn. of UCL, but so under the fund unavailable recovery is into a fluid and above restitution.16 is over any disgorgement recov- into a fluid
Second, holding regarding disgorgement the majority’s Kraus the law was clear before fund misses even ery point on the action is not whether dependent of fluid availability *38 If action, substantive law at issue. a class but on the underlying certified as fine; if it does not then the fact recovery, that substantive law fluid permits binding There are a number of that it is a class action does matter. v. Levi effect, the leading being to this one State precedents of California (Levi 605, 715 P.2d Strauss & Co. Cal.3d 460 Cal.Rptr. 564] [224 or not to approve before the court there was whether issue Strauss). a Cart- a fluid settlement—including recovery provision—in issue, on that the court held: “The propriety Act case. Before wright ruling in fulfilling in a case its usefulness recovery depends upon of fluid particular 472.) the of the cause of action.” purposes underlying (Id. p.
This these and relied the articulate upon principle they words quoted Stores, 62, in Collins v. Inc. Cal.App.3d Safeway now, to avoid P. J. But conc.). apparently wishing Cal.Rptr. (Kline, 638] Strauss, to the Levi declares that case has “limited relevance majority of here” it enactment of what is now Code Civil issue because preceded ante, section Our 667.) Procedure 384. (Maj. opn., p. the rule that the to learn this. It still finds apparently “propriety surprised cause of action” to be still
of fluid recovery” depends upon “underlying relevant, those words from Levi Strauss two exactly years because quoted Kraus, in Kraus. 23 Cal.4th at ago (See
Nor, Levi to “limited did our intend to reduce Strauss clearly, Legislature Procedure section 384 relevance” when it enacted what is now Code of Civil course, fact, in is purely procedural 1993. both that statute (which, in- and its demonstrate that history Legislature anyway17) legislative cause of action” of Levi Strauss. “underlying principle tended to preserve (enacted For Code of Procedure section subdivision (a) Civil example, “It of the in intent part: in 1993 as subd. reads (a)), pertinent § residuals unpaid this section to ensure Legislature enacting in manner distributed, the extent possible, class action litigation action, cause either to purposes underlying designed further And the follow- . . . .” (Italics added.) for all Californians justice promote also (b), Procedure section subdivision Code of Civil ing provision, of action.” to the cause “underlying links fluid exactly Kraus to hold federal district court understood majority, a California 16Unlike Rorer, Laboratories, (C.D.Cal. 2001) Inc. Inc. v. Rhone-Poulenc (See this. Watson 1099, 1121-1122.) F.Supp.2d 17See footnote ante. Civil Procedure section Code of history (now) The legislative example, For gambit. “limited relevance” majority’s further undermines regarding (now) committee legislative reports numerous bill analyses cite Levi Strauss but also section 384 not Code of Civil Procedure methods distribut- of the ‘appropriate reference its “excellent discussion Com., Rules Off. class actions.’” Sen. (E.g., consumer ing damages Bill No. 536 (1993-1994 3d Sen. Analyses, reading analysis Sen. Floor 9, 1993, reports analyses These same 2.) as amended Sept. p. Reg. Sess.) “will proposed legislation to the effect that also include statements manner funds in which to distribute the unclaimed a court permit objectives purposes is consistent with court determines Com., floor Analyses, Rules Off. of Sen. causes of action.” underlying (Sen. 10, 1993, Sept. Bill 536 (1993-1994 Reg. Sess.) of Sen. No. Analysis *39 Strauss, in of Levi Thus, cavalier treatment majority’s notwithstanding 384 our Legislature Procedure section is now Code of Civil enacting what substan- rule that the underlying not intend to alter that case’s did obviously Kraus, clearly After recovery. action must justify liquid tive cause of no such thing. UCL does of the is incorrect for each I the majority’s opinion believe
Although similar above, magnitude. its errors to be of I do not find reasons detailed are UCL actions Thus, class actions and representative whether regarding in this state are current practice I that the law and concede incompatible, above, the appropriateness discussed And two other issues regarding unclear. finding petitioner’s the lower court’s relief on this record and of writ wrong, views on them to be the majority’s I believe although nontypicality, truly egregious The majority’s many sleepless nights. will not cause me they between the order superior its to distinguish errors lie in refusal reasons court proffered the second of two reviewing court we advocacy proposition its of that order and unabashed support UCL cause of action with a representative fluid compatible six-to-one two-year-old ruling Court’s our notwithstanding Supreme Kraus to the contrary. quite for review by in interest of real petition parties Baxter, Chin, J., therein. participate did December 2002.
was denied granted. should be Brown, J., petition J., opinion were of