HEATHER L. NEWTON, Plaintiff, v. AMERICAN DEBT SERVICES, INC., et al., Defendants.
No. C-11-3228 EMC
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA
December 16, 2014
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT (Docket No. 238)
Plaintiff Heather Newton filed a putative class action lawsuit against Defendants American Debt Services (ADS), Quality Support Services (QSS), Global Client Solutions (Global) and Rocky Mountain Bank and Trust (RMBT, or the Bank) alleging various violations of California and Federal law relating to Defendants’ debt-settlement enterprise. See Docket No. 1 (Complaint). Global and RMBT are the only remaining defendants after ADS and QSS defaulted. Docket Nos. 156, 199 (Entry of Default).
After this Court dismissed a number of Plaintiff‘s causes of action, and rejected certain of her legal theories, Plaintiff filed her second amended (and operative) complaint. Docket No. 206 (Second Amended Complaint). In that complaint, Plaintiff alleges that RMBT violated all three prongs of California‘s Unfair Competition Law (UCL) where it purportedly breached the terms of a 2009 Cease and Desist Order entered into between RMBT and the Federal Deposit Insurance Corporation (FDIC). Id. at 17. Plaintiff also claims that RMBT and Global each aided-and-abetted
For the reasons explained below, this Court grants summary judgment in favor of RMBT on all of Newton‘s UCL claims predicated on violations of the FDIC Order. Newton‘s “unlawful” and “unfairness” prong claims fail because the FDIC Order cannot be enforced in this Court or otherwise “borrowed” to serve as a predicate law violation under the UCL. And Newton‘s “fraudulent” prong claim fails because Newton did not respond to Defendants’ summary judgment motion on this ground, thereby conceding the claim as a matter of law. However, the Court denies RMBT‘s and Global‘s summary judgment motion regarding Newton‘s aiding-and-abetting causes of action. As this Court has previously held, those claims may proceed to trial.
II. BACKGROUND2
A. Factual Background
1. Newton‘s Debt Settlement
Plaintiff Heather Newton resides in Santa Clara County. Docket No. 206 at 4. Defendants ADS, QSS, Global, and RMBT collectively provided debt settlement services to Newton. ADS is a debt settlement company that advertised its services online to consumers. See Docket No. 146-4 (Ex. D to Leonard Decl.) (Newton Depo., at pg. 16). Newton found ADS‘s webpage offering debt settlement assistance. Id. In August 2009, Newton signed up online for ADS‘s services. See Docket No. 146-1 (Ex. A to Leonard Decl., at pg. NEWTON_00058). Newton and ADS agreed that ADS would provide debt settlement and restructuring services, which consisted of negotiating with creditors on Newton‘s behalf for reduction of debt and formulation of a payment plan. See Docket No. 146-1 (Ex. A to Leonard Decl., at pg. NEWTON_00054).
For its part in this debt settlement enterprise, QSS agreed to provide “customer service functions” and other services to process debt settlements for ADS clients. See Docket No. 185 (Ex.
Global‘s role in the debt-settlement scheme was to create bank accounts for ADS clients to “accumulate and disburse funds in connection with the repayment of their debts.” See Docket No. 251-4. (Ex. 3 to Kennedy Decl., at pg. GLOBAL-CONFIDENTIAL-00056). Essentially, Global is a payment processor for consumers who are enrolled in debt settlement programs. See id. Global touts itself as “a leading provider of account management services to the debt settlement industry today.” See Docket No. 185 (Ex. 4 to Kennedy Decl.).
RMBT, a Colorado-chartered bank, agreed to provide custodial bank accounts (sometimes referred to as “Special Purpose Accounts“) for debt settlement companies and their clients, such as ADS and Newton. See Docket No. 185 (Ex. 2 to Kennedy Decl., at pg. RMBT-CONFIDENTIAL-00002, ¶¶ 3.1). As part of Newton‘s agreement with ADS, Global opened and administered a Special Purpose Account in Newton‘s name at RMBT. See Docket No. 146-4 (Ex. D to Leonard Decl.) (Newton Dep. 36:22-38:13). Global maintained access to Newton‘s payment history, including how much ADS and QSS charged Newton for debt settlement services. See Docket No. 185 (Ex. 3 to Kennedy Decl., ¶¶ 1[b], 1[d]). And Global agreed to provide ADS and QSS with access to Newton‘s account activity, including deposits and withdrawals. See Docket No. 185 (Ex. 3 to Kennedy Decl., ¶ 1[g]). RMBT had independent access to these pieces of information. See Docket No. 185 (Ex. 6 to Kennedy Decl.) (Hampton Depo., at pgs. 24-25).
In April 2010 another creditor, Chase, served Newton with a summons and complaint in a collection action. See id. at ¶ 14. Newton subsequently settled the debt without assistance from Defendants. See id. at ¶ 18. Newton also settled with a third creditor (Capital One) without assistance. See Docket No. 146-4 (Ex. D to Leonard Decl.) (Newton Depo., at pg. 56). In June 2010, Newton terminated her account with ADS via certified letter. See id. at ¶ 19. Ultimately, Newton paid a total of $4,206.50 into the Special Purpose Account at RMBT, of which $70.04 was eventually refunded to her, $2,200 was paid to Bank of America, and the balance of which Defendants kept. See id. at ¶ 20. Records maintained by Global confirm that Newton was charged $1,936.46 in “Customer Fees” and “Transaction Fees.” See Docket No. 185 (Ex. 1 to Kennedy Decl., at pgs. GLOBAL.R26.00003-GLOBAL.R26.00005). These amounts appear well in excess of those allowed under the Proraters Law. See
2. Regulatory Actions Against Global and RMBT
Both Global‘s and RMBT‘s involvement in the debt-settlement industry raised the attention of government regulators. See, e.g., Docket Nos. 164-1; 164-2 (Regulatory Letters). In 2008, the California Department of Corporations targeted Global, along with others, for prorating without a license and collaborating with other companies, including RMBT, to prorate without a license. See Docket No. 164-2 at 1-6. The Department of Corporations specifically ordered Global, “in concert
The FDIC targeted RMBT in 2009. Specifically, on April 2, 2009, RMBT consented to the issuance of a cease and desist order (hereafter, the FDIC Order, or the Order) without a hearing. Docket No. 164-1 (FDIC Order). According to the Order, the FDIC “had reason to believe that the Bank had engaged in unsafe or unsound banking practices and had violated laws and/or regulations.” Id. at 1. Consequently, RMBT was ordered to cease and desist a number of such practices, including “[f]ailing to appropriately monitor and/or manage third-party risk and operating in contravention of the FDIC‘s Guidance for Managing Third-Party Risk.” Id. at 2-3. Specifically, the Order required RMBT to “provide adequate and effective oversight over the Bank‘s third-party relationships, specifically focusing on monitoring the activities of third-party payment processors and their customers, who are referred to herein as Debt Settlement Companies (‘DSC‘).” Id. at 19. The FDIC also ordered RMBT to review, revise, and implement “third-party policies” that would “[e]nsure the Bank‘s compliance with Federal and state consumer protection laws, regulations, and policies” id., and further required the “development of internal monitoring procedures to:
(i) Ensure ongoing review of each payment processor, ACH originator, and DSC;
(ii) Maintain documentation demonstrating that each payment processor, ACH Originator, and DSC‘s activities are beneficial to consumers; [and]
(iii) Ensure that payment processors, ACH originators, and DSCs rectify harmful consumer activity or the Bank shall cease operations with the payment processor, ACH originator, and/or DSC . . .”
Id. at 20. RMBT was required to submit its revised policies to the FDIC within 60 days of the effective date of the Order.5 Id. at 19-20. The FDIC had 30 days to provide comments on the Bank‘s policies. Id. at 20. After receiving any FDIC comments, the Order required that “the Bank shall approve the revised policies . . . [and] shall implement [them].” Id. at 21.
RMBT responded to the FDIC‘s criticism in December 2009, but despite RMBT‘s purported efforts to comply with the Order, later correspondence from the FDIC indicates that it remained largely unsatisfied with RMBT‘s revised policies and procedures to monitor third-party debt servicing companies (like Global, QSS, and ADS) and ensure their compliance with state laws. For example, on February 24, 2010, FDIC stated that deficiencies continued regarding RMBT‘s substantive compliance with the Order, and specifically the Third Party Risk provisions. Id. at RMBT.CONFIDENTIAL.00005810. FDIC further reiterated an earlier demand that RMBT develop and submit a plan to terminate its relationship with Global in a timely manner given RMBT‘s alleged noncompliance with the Order. Id.
On April 20, 2010, RMBT wrote to Global informing it that RMBT “has been directed by the Federal Deposit Insurance Corporation to terminate its entire . . . relationship” with Global. Id. at RMBT.CONFIDENTIAL.00005869. RMBT informed Global that all Special Purpose Accounts at the Bank serviced by Global would be terminated by August 31, 2010. Id.
The FDIC finally expressed satisfaction with RMBT‘s compliance with the third-party risk provisions of the Order on February 24, 2011. Id. at RMBT.CONFIDENTIAL.00006021. But even
B. Procedural History
Newton filed this putative class action on behalf of herself and similarly situated consumers on June 29, 2011. Docket No. 1. Defendants moved to compel arbitration of Newton‘s claims. Docket Nos. 36, 39. This Court denied the motion and the Ninth Circuit affirmed. Docket Nos. 72, 224. While the Ninth Circuit appeal was pending, ADS and QSS defaulted. Docket Nos. 156, 199.
On April 22, 2013, Global and RMBT filed separate summary judgment motions attacking a number of Newton‘s legal theories. Specifically, they argued that Newton‘s claims against them under the Credit Repair Organizations Act (CROA)6 and California Legal Remedies Act (CLRA)7 failed as a matter of law. See Docket No. 204. Global and RMBT also argued that Newton‘s UCL claims that they conspired to violate, or aided-and-abetted violations of, California‘s Proraters Law could not proceed to trial. Id. The Court granted summary judgment with respect to the CROA and CLRA claims, and also granted summary judgment in favor of RMBT on Newton‘s conspiracy claim. Id. at 26. The Court denied summary judgment on the remaining UCL indirect liability claims, holding that the “facts create a genuine issue of whether [Global] and/or RMBT aided-and-abetted ADS and QSS in violating the Proraters Law‘s maximum charge provision and whether [Global] conspired with ADS and QSS to violate that provision . . . .” Id. at 22. The Court also noted that “there is [] sufficient evidence to infer that both [Global] and RMBT aided and abetted violations of the licensing provision” of the Proraters Law. Id. at 21. Newton‘s motion to amend her complaint was granted with regards to the Proraters Law claims that the Court determined had survived summary judgment. Id at 22-25. Newton filed her Second Amended Complaint on October 17, 2013. Docket No. 206.
On May 15, 2014, Global and RMBT once again filed for summary judgment. Docket No. 238. RMBT argues it is entitled to summary judgment on those of Newton‘s UCL claims which are predicated on RMBT‘s alleged violation of the FDIC Order.8 Specifically, RMBT argues that: (1) the Order is not an independent law that can be borrowed for purposes of establishing liability under the “unlawful” prong of the UCL; (2) RMBT did not violate any affirmative commands of the Order, and thus it could not have committed either “unlawful” or “unfair” acts under the UCL; and (3) any conduct in violation of the Order could not establish liability under the “fraudulent” prong of the UCL because Newton did not know about the FDIC Order or otherwise rely on RMBT to act in compliance with that Order. Id. at 7-18. Global and RMBT also argue that they are entitled to summary judgment on Newton‘s UCL claims alleging that Global and RMBT aided-and-abetted ADS‘s and QSS‘s violations of the Proraters Law – the exact same argument this Court has previously rejected in two written orders. See Docket Nos. 204, 223.
A. RMBT is Entitled to Summary Judgment on Newton‘s UCL Claims That Are Predicated on “Violations” of the FDIC Order Because This Court Cannot Enforce That Order Either Directly or Indirectly
All three of Newton‘s remaining direct UCL claims are predicated on allegations that RMBT violated the terms of the FDIC Cease and Desist Order. Specifically, Newton alleges that: (1) “RMBT‘s ongoing business relationship with [Global] and QSS is unlawful, in that it violates the Federal Deposit Insurance Corporation‘s Cease and Desist Order of April 2, 2009“; (2) RMBT‘s “conduct in violation of the Cease and Desist Order was and is unfair in that the harm to consumers from [RMBT‘s] conduct outweighs the utility of that conduct“; and (3) RMBT‘s conduct in violation of the Cease and Desist Order “was and is fraudulent in that it tends to mislead the general public.” Second Amended Complaint at ¶¶ 107-109. Succinctly stated, Newton alleges that RMBT violated the FDIC Order, and thereby transgressed all three prongs of the UCL. See
In its latest motion for summary judgment, RMBT argues that all of Newton‘s UCL claims predicated on violations of the FDIC Order necessarily fail because this Court lacks jurisdiction to enforce the FDIC Order, either directly or indirectly, and similarly lacks the institutional competence to determine whether the FDIC Order was, in fact, violated. For the reasons explained below, the Court agrees with RMBT.
1. The FDIC Order Cannot Be “Borrowed” Under the UCL Unlawful Prong
The UCL substantively prohibits business acts or practices that are “unlawful.” See
RMBT argues that Newton‘s claim under the unlawful prong of the UCL must fail because the 2009 FDIC Order is not an “independent law” that can be borrowed to serve as a predicate for a UCL violation. Docket No. 238 at 9-12. Neither party submitted any case law (and the Court has found none in its own research) addressing whether a regulatory order or consent decree, like the FDIC Order here, can form the basis of an alleged violation of §17200‘s unlawful prong. Hence, this Court considers this issue on a clean slate.
The slate, however, is not entirely spotless: California courts have previously found that the UCL provides a cause of action to remedy an extremely wide variety of allegedly “unlawful” behavior. “Virtually any law or regulation – federal or state, statutory or common law – can serve as predicate for a §17200 ‘unlawful’ violation.” Stern, Business and Professions Code §17200 Practice, 3:56 (Rutter Group 2014 ed.).
Consideration of a small sample of exemplar cases demonstrates just how broadly certain courts have interpreted the reach of UCL‘s unlawful prong. For instance, in Garrett v. Coast & Southern Fed. Sav. & Loan Assn., 9 Cal. 3d 731 (1973), the California Supreme Court interpreted a provision of the California Civil Code to prohibit contracts which pre-set the amount of damages to be awarded in the event of a default, unless such damages would be “impracticable” to calculate or otherwise “extremely difficult to fix.” Id. at 738. In a later case, Bondanza v. Peninsula Hospital & Medical Center, 23 Cal. 3d 260, 266-68 (1979), the Supreme Court was asked to determine whether a hospital‘s 33% surcharge on delinquent or defaulted accounts was a contractual penalty, and therefore violated the rule prohibiting such penalties announced in Garrett. The Bondanza court concluded that the surcharge was an even “more patent violation” than the one in Garrett, and concluded that the 33% assessment was thereby “plainly unlawful” under the UCL. See id at 266-67. That is, the Bondanza court “borrowed” the case law rule announced in Garrett, and found that violation of that rule was an independent violation of the UCL‘s “unlawful” prong. See id. at 268 (holding that the Court was “compelled to decide on the authority of Garrett that the defendants’ conduct herein is unlawful“); see also Community Assisting Recovery, Inc. v. Aegis Security Insurance Co., 92 Cal. App. 4th 886, 891 (Cal. 2001) (acknowledging that “an unlawful business practice actionable under the UCL is one that violates an existing law, including case law“) (internal quotation marks and citation omitted).
A panel of the Court of Appeal went even further in Hewlett v. Squaw Valley Ski Corp., 54 Cal. App. 4th 499 (Cal. 1997). In Hewlett, Defendant Squaw Valley Ski Corporation violated a temporary restraining order (TRO) issued by the trial court. See Id. at 533. Rather than bringing contempt proceedings against Squaw, plaintiffs instead filed an action alleging that Squaw had violated the “unlawful” prong of §17200. Id. Squaw argued that a TRO could not be borrowed to serve as predicate authority for the purposes of the UCL, particularly where the TRO could be enforced directly via contempt proceedings. Id. at 535. The Court of Appeal disagreed, holding that “proceedings under the unfair competition statutes are cumulative to other possible remedies or penalties, and violations of a TRO may therefore be prosecuted as an unlawful business practice.” Id. (citations omitted).
The Ninth Circuit has also weighed in, albeit briefly, on the sweep of the UCL‘s unlawful prong. In CRST Van Expedited, Inc. v. Werner Enterprises, Inc., 479 F.3d 1099 (9th Cir. 2007), the court held that a plaintiff had adequately alleged a violation of the unlawful prong where he claimed that the defendant had “stolen” his employees in violation of the common law prohibition against intentional interference with employment contracts. Id. at 1107. The panel noted that its conclusion was a simple one given that the “California Supreme Court has given the term ‘unlawful’ a straightforward and broad interpretation . . . [that] ‘embraces anything that can properly be called a business practice and that at the same time is forbidden by law.‘” Id. (quoting Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134, 1143 (2003)). The California Supreme Court later confirmed that the UCL “unlawful” prong may borrow obligations imposed solely by the common law. Zhang, 57 Cal. 4th at 384.
Still, “[a]lthough the unfair competition law‘s scope is sweeping, it is not unlimited.” Cel-Tech Communications, Inc. v. L.A. Cellular Telephone Co., 20 Cal. 4th 163, 182 (1999). One such limit particularly relevant here is the prohibition on borrowing laws for the purposes of UCL liability where those laws provide a “safe harbor” for the challenged conduct or otherwise “bar”
Here, RMBT argues that private enforcement of the FDIC Order is absolutely barred as a matter of federal law, and thus this Court cannot “borrow” the Order for the purpose of imposing liability under the UCL. RMBT appears correct.
The 2009 FDIC Order was issued pursuant to powers granted the FDIC by Congress in
As relevant here, however,
Accordingly,
Newton argues otherwise, and cites two out-of-district cases that have construed the jurisdictional provisions of
Plaintiffs in Rex sued Chase for alleged misrepresentations and other unlawful acts undertaken in connection with their Chase mortgages. Rex, 905 F. Supp. 2d. at 1119. According to plaintiffs, Chase promised to release them from the obligation to pay any remaining balance outstanding on their mortgages after the plaintiffs sold their properties at a loss. Id. Instead, Chase reneged on its promise, and “sought to collect the short sale deficiency and reported Plaintiffs’ failure to pay it to credit reporting agencies.” Id. Plaintiffs sued under a variety of statutes, including the Consumer Credit Reporting Agencies Act (CCRAA), the Rosenthal Fair Debt Collection Practices Act (FDCPA), and the UCL. Id. at 1122. Notably, however, the Rex plaintiffs’ UCL cause of action did not seek to enforce the terms of the regulatory cease-and-desist order; rather it was a derivative claim for injunctive relief predicated on Chase‘s alleged violation of other substantive statutes (such as the CCRAA and FDCPA). See id. at 1130 n. 16.
Indeed, it was defendant Chase that raised the issue of the cease-and-desist order, namely an order Chase and the Office of the Comptroller of the Currency (OCC) entered into nearly a year before the Rex plaintiffs filed their complaint.10 Id. at 1121. In that order, Chase agreed to adopt a “compliance program” aimed to guarantee that Chase would, among other things, “ensur[e] effective coordination of communications with borrowers” related to short sales and foreclosure activities. Id. That is, Chase‘s compliance with the cease and desist order arguably would have required it adopt a monitoring program aimed to stop the very same misleading practices the plaintiffs later filed suit over. See id. at 1126. Thus, Chase argued that the district court lacked jurisdiction to hear plaintiffs’ case under
The Rex court made this clear. Following the reasoning of In re JPMorgan Chase,11 the court first explained that the “jurisdictional bar” in
“Rather, ‘the primary purpose of
The Rex court then went on to explain that Congress did not intend
[Chase]‘s interpretation of Section 1818(i) would require this Court to read a regulatory statute designed to strike fear in the hearts of the banking industry as actually creating a jurisdictional mechanism by which banks can escape millions of dollars of liability in consumer class actions. Essentially, Defendants’ rule allows any defendant-bank to insulate itself from liability for practices that violate state contract and consumer laws simply by entering into an OCC consent order which requires the defendant-bank to develop a plan. Under Defendants’ rule, the defendant-bank could then use its promise to make a plan to divest courts of jurisdiction over numerous consumer lawsuits, even if the defendant-bank implements a plan that denies the very relief that plaintiffs seek in those lawsuits.
Id. (emphasis omitted). Consequently, the court concluded that it did not lack jurisdiction to adjudicate plaintiffs’ various state law claims regarding Chase‘s handling of short-sale mortgages.12
Hence, for the reasons stated above, the rule adopted in Rex is entirely consistent with this Court‘s determination that
Indeed, Congress‘s decision to vest exclusive enforcement jurisdiction over
At bottom, Newton cannot “borrow” the FDIC Order to serve as predicate authority for a violation of the UCL‘s unlawful prong because
2. The FDIC Order Similarly Cannot Be Enforced Through the UCL‘s “Unfairness” Prong
RMBT also requests summary judgment on Newton‘s claim that it violated the “unfair” prong of the UCL where it allegedly breached the terms of the FDIC Order.13 For the same reasons
In her opposition to RMBT‘s summary judgment motion, Newton concedes that the only “unfair” behavior targeted in her complaint is the “ongoing business relationship” between RMBT and QSS, ADS, and Global. Docket No. 250-4 at 18. And in Newton‘s complaint, she directly and exclusively pleads that the ongoing business relationship is “unfair” because it was “in violation of the Cease and Desist Order.” Docket No. 206 at 17. Thus, as pleaded, Newton‘s unfairness prong claim turns on whether RMBT actually violated the FDIC Order, a determination this Court has already concluded it lacks the power to make under
Newton tries to walk back this aspect of her complaint, arguing that what she meant to allege is that the ongoing business relationship between RMBT, QSS, ADS, and Global was “unfair” regardless of whether it actually violated the FDIC cease and desist order. But this is not what her complaint says. The complaint says simply: ”Unfair. Defendants’ conduct in violation of the Cease and Desist Order was and is unfair in that the harm to consumers from Defendants’ conduct outweighs the utility of that conduct.” Docket No. 206 at 17. This claim clearly depends on Newton proving that RMBT‘s conduct was “in violation of the Cease and Desist Order.”14 Id.
Newton argues that if this Court finds (as it has) that it cannot adjudicate whether RMBT actually violated the FDIC Order, that she be allowed to amend her complaint to allege that RMBT acted unfairly simply by continuing its business relationship with its co-defendants irrespective of the commands of the FDIC Order. Such an amendment could possibly salvage Newton‘s claim. But
3. RMBT‘s Summary Judgment Motion on the “Fraudulent” Prong Is Granted
As the Court has previously explained, it lacks jurisdiction to even “affect” the enforcement of the FDIC Order. For this reason, dismissal of Newton‘s fraudulent prong claim predicated on violations of the FDIC Order would also seem appropriate. But RMBT is entitled to summary judgment on this claim for an even simpler reason: In her opposition, Newton does not address or respond to RMBT‘s arguments regarding the fraudulent prong. Nor does Newton provide any evidence that would be relevant to defeat summary judgment with respect to the fraudulent prong. Consequently, RMBT is entitled to summary judgment on this claim because Newton conceded it as a matter of law. See, e.g., Mariscal v. Graco, Inc., -- F. Supp. 2d. --, 13-cv-02548-TEH, 2014 WL 2919520, at *7 (N.D. Cal. June 26, 2014) (“Defendant moves for summary judgment on Plaintiff‘s claims for breach of warranty. Plaintiff failed to address there arguments in his opposition brief, and therefore conceded these claims.“); Jenkins v. Cnty. of Riverside, 398 F.3d 1093, 1095 n.4 (9th Cir. 2005) (noting that the Plaintiff “abandoned her other two claims by not raising them in opposition to the County‘s motion for summary judgment“).
B. RMBT‘s and Global‘s Motion for Summary Judgment on Newton‘s Aiding-and-Abetting Claims Is Denied
The last ground for summary judgment is raised by both Global and RMBT. They argue that they are entitled to summary judgment because there is no cause of action under the UCL for aiding-and-abetting a violation of California‘s Proraters Law. Docket No. 238 at 18-20. This argument has already twice been explicitly rejected by this Court in written orders. See Docket Nos. 204, 223. And it has also been rejected by numerous California courts that have expressly found that aiding-and-abetting liability exists for UCL claims. See People v. Toomey, 157 Cal. App. 3d. 1, 15 (Cal. 1984) (“[I]f the evidence establishes defendant‘s participation in the unlawful practices, either directly or by aiding and abetting the principal, liability under [the UCL] can be imposed.“) (citations omitted); see also Stern, Business and Professions Code §17200 Practice, 6:6 (Rutter Group 2014 ed.) (noting that California courts recognize six forms of secondary liability under the UCL, including aiding and abetting, and collecting cases). The cases cited by Defendants in support of their motion do not hold otherwise. See, e.g., DuFour v. Be., LLC, No. C 09-3770 CRB, 2010 WL 431972, at *3 (N.D. Cal. Feb. 2, 2010) (addressing whether aiding and abetting liability exists under the Advance Fee Talent Services Act); Toy v. TriWire Engineering Solutions, Inc., No. C 10-1929 SI, 2010 WL 3448535, at *3 (N.D. Cal. Sep. 1, 2010) (striking UCL aiding and abetting allegations without analysis because plaintiff failed to cite any relevant authorities).
In fact, not only did the Court previously find that both Global and RMBT can be held liable under the UCL for aiding-and-abetting ADS‘s and QSS‘s violations of the Proraters Law, the Court further held that Newton had submitted sufficient evidence to proceed to trial on these claims. See Docket No. 204 at 21 (holding that there is “sufficient evidence to infer that both [Global] and RMBT aided and abetted violations of the licensing provision“); id. at 22 (holding that the “facts
IV. CONCLUSION
RMBT‘s motion for summary judgment on Newton‘s UCL claims predicated on violations of the FDIC Order is granted because this Court lacks jurisdiction to adjudicate these claims. Moreover, Newton abandoned her claim under the UCL‘s fraudulent prong. RMBT‘s and Global‘s motion for summary judgment on Newton‘s aiding-and-abetting claims, however, is once again denied.
This order disposes of Docket No. 238.
IT IS SO ORDERED.
Dated: December 16, 2014
EDWARD M. CHEN
United States District Judge