The UCL Practitioner
Friday, April 29, 2005
 
Stare decisis twist
When the Supreme Court grants review, the Court of Appeal's opinion is no longer considered published and therefore no longer citable as precedent. See Rule of Court 976(d)(1). Accordingly, Mervyn's, Branick, Benson, Bivens, and Lytwyn are now all uncitable. However, two published Prop. 64 opinions remain: Frey v. TransUnion Corp., 127 Cal.App.4th 986 (2005), and Thornton v. Career Training Center, Inc., 128 Cal.App.4th 116 (2005). No review petitions have been filed in those cases, and the Supreme Court did not reach out to take them, as it did Lytwyn. This means that as of right now, the only citable appellate cases hold that Prop. 64 does apply retroactively to pending litigation. Under familiar rules of stare decisis, trial courts are bound to follow those cases. The Supreme Court has until approximately May 23 in Frey and June 3 in Thornton to grant review. See Rule of Court 28.2(c)(1). It should do so, or depublish them.
 
"Supreme Court Will Decide Prop 64 Retroactivity"
Yesterday's Daily Journal also had a very nice article, in which I am quoted, on the recent developments in the Supreme Court.
Thursday, April 28, 2005
 
"California justices to clarify Prop 64 tort reform"
The San Francisco Chronicle also picked up the story, as did the Los Angeles Times. The Associated Press story appears in papers across the country.
 
"State High Court to Review Cases in Prop 64 Flap"
This morning's Recorder has the story, which quotes me and describes this blog as "a de facto clearing house for information on Prop 64." Thank you, Justin. I owe Justin Scheck a debt of gratitude for alerting me to yesterday's developments. His article points out that both parties in Mervyn's urged the Supreme Court to grant review, which is something I wasn't previously aware of. That, coupled with the fact that Mervyn's was the first case in which review was sought, explains why the Supreme Court chose Mervyn's as the lead case over the others.
Wednesday, April 27, 2005
 
MORE BREAKING NEWS: Supreme Court denies review in two other Prop. 64 cases
After granting review in the five cases listed in my post below, the Supreme Court DENIED review in two other cases:
They're obviously focusing in on the published opinions.

UPDATE: The Court's decision to deny review in both of these cases is quite interesting. In Mastercard, the trial court (Judge Kramer) held that Prop. 64 does NOT apply to pending cases. In Duran, the trial court went the other way. In both cases, writ petitions were summarily denied. The fact that review was denied in both cases speaks volumes about the Court's lack of preconceptions on the retroactivity question.
 
BREAKING NEWS: Supreme Court grants review in five Prop. 64 cases
The Supreme Court just granted review in five of the cases in which the Prop. 64 retroactivity question has been raised. All involve published Court of Appeal opinions:

I will post more on this development later.

UPDATE: Here's the story. The Court granted review outright in Mervyn's, and issued "grant and hold" orders in Bivens and Lytwyn. In Benson, the Court granted review of Mr. Benson's review petition, which raised the Prop. 64 issue, and denied review of Kwikset's review petition, which raised other UCL-related issues. Benson, too, is a "grant and hold" order, pending the outcome of Mervyn's. In Branick, the Court granted review of a limited issue:
If the standing limitations of Proposition 64 apply to actions under the Unfair Competition Law that were pending on November 3, 2004, may a plaintiff amend his or her complaint to substitute in or add a party that satisfies standing requirements of Business and Professions Code section 17204, as amended, and does such an amended complaint relate back to the initial complaint for statute of limitations purposes?
You may recall that in Branick, the Court of Appeal held that the trial court did have discretion to grant leave to amend. As I'm sure all my readers know, Mervyn's was the first decision on Prop. 64 retroactivity, and Branick was the second (and the first to address the amendment issue), so it makes sense that the Court would grant review in the way it did.
 
New amicus brief in Kids Against Pollution
Many thanks to the reader who sent me a copy of the amici curiae brief filed by the California Chamber of Commerce and the California Bankers Association in the Kids Against Pollution case. It has been added to my list of Prop. 64 appellate briefs. The parties' response to that brief is due on May 10, at which point the briefing will be complete unless more amicus filings appear.
 
"Will You Still Need Me, Will You Still Plead Me, After Prop. 64?"
That catchy phrase is the title of a day-long MCLE seminar on the UCL. It will be held in San Diego on May 13. This is the annual program of the State Bar of California's Antitrust and Unfair Competition Law Section, which I've attend in the past, and it's always very good. This year's seminar features prominent practitioners and several judges. However, I do hope that Northern California attorneys will attend the program at which I will be speaking in San Francisco on May 10, sponsored by the Practicing Law Institute. Judge Richard A. Kramer, the complex litigation judge in San Francisco who has issued multiple rulings on Prop. 64 retroactivity, will be a co-speaker. Even my mom said she wants to come!
Tuesday, April 26, 2005
 
Update on Foundation Aiding the Elderly review petition
The Supreme Court docket now has an entry for the review petition in Foundation Aiding the Elderly v. Superior Court, Cal. Supreme Court case no. S133293. This is the case in which the First District issued an unpublished opinion reaffirming its holding in Mervyn's that Prop. 64 does not apply retroactively to pending cases. The Supreme Court docket describes the review petition as "premature," and indicates that the start date for the case will be May 3, 2005.
 
Prop. 64 pending appeals list updated
I've also updated my list of Prop. 64 pending appeals to reflect all the recent activity at the Supreme Court level, about which I've been posting over the past week.
 
Prop. 64 appellate briefs list updated
I've updated my list of Prop. 64 appellate briefs to include the answer to the petition for review in Bivens. Many thanks to Scott A. McMillan, counsel for Mr. Bivens, for sending me a copy. If you have any other appellate briefs on Prop. 64 or the UCL, please send them in.
Monday, April 25, 2005
 
Another brief filed in Apple blogger case
On Friday, the bloggers in O'Grady v. Apple Computer, Inc. (Sixth Appellate District, case no. H028579) filed a reply to Apple's opposition to their petition for writ of mandate. As the reply observes, the outpouring of amici support for the bloggers has been "extraordinary." On Thursday, the Court of Appeal granted several pending requests for leave to file amici curiae briefs, including the brief in which I joined.
 
Recent class action decisions
Now that many plaintiffs will be seeking formal class certification of their UCL claims, practitioners should stay on top of developments in class action law. I'm going to try to do that in this blog. Several noteworthy class action decisions have been handed down recently:

  • In Chamberlan v. Ford Motor Co., ___ F.3d ___ (Mar. 31, 2005) (per curiam), the Ninth Circuit addressed, for the first time, the circumstances under which it would accept, under Federal Rule of Civil Procedure 23(f), an interlocutory appeal from an order granting or denying class certification. The opinion contains a detailed discussion of how other Circuits have dealt with this issue, and holds that:
    We adopt the principles justifying review that are set out in the Advisory Committee Notes—the presence of a death knell situation for either party absent review and the presence of an unsettled and fundamental issue of law related to class actions—along with an additional criterion, manifest error in the district court's certification decision.
    Applying those criteria, the Court declined to review an interlocutory order granting class certification of a CLRA claim involving allegedly defective components in certain Ford vehicles. This is a significant development for those of us handling class actions in federal court.

  • In Pioneer Electronics (USA), Inc. v. Superior Court, ___ Cal.App.4th ___ (Mar. 30, 2005), the Court of Appeal (Second Appellate District, Division Four) addressed the issue of pre-certification notices to putative class members (a relatively rare occurrence). The Court held that because the notices sought permission to release personal identifying information, "it was incumbent upon the trial court to fashion a means of notification that assures that the consumer receive actual notice and, hence, an opportunity to assert his or her right of privacy before the consumer is deemed to have given up that right." (Slip op. at 14-15.) UPDATE: On July 27, 2005, the Supreme Court granted review in this case. Here is a link to the docket.

  • In Cummings v. Connell, ___ F.3d ___ (Mar. 29, 2005), the Ninth Circuit held that "when nominal damages are awarded in a civil rights class action, every member of the class whose constitutional rights were violated is entitled to nominal damages. An award of nominal damages to only the named class representatives fails to appreciate the difference between a class action and a conventional lawsuit." This ruling raised the damages award from $7 to $37,000, a not-insignificant increase. The Court went on to hold that the amount of attorneys' fees should be revisited in light of the enhanced benefit to the class.

  • Finally, as I previously reported, in Consumer Cause, Inc. v. Mrs. Gooch's Natural Food Markets, Inc., ___ Cal.App.4th ___ (Mar. 7, 2005), the Court of Appeal elaborated on the circumstances under which class action objectors are entitled to recover attorneys' fees for their efforts. (A petition for review was recently filed in this case.) UPDATE: The petition for review was denied on June 29, 2005.
  • Saturday, April 23, 2005
     
    "Initial Reflections on the Law and Economics of Blogging"
    This article is by a law professor (Larry Ribstein of the University of Illinois College of Law) and is very intriguing. (Hat tip to IPTABlog.)
    Friday, April 22, 2005
     
    April 2005 issue of Mealey's California Section 17200 Report now available
    The editor of Mealey's California Section 17200 Report asked me to announce that the April 2005 issue is now out. He graciously sent me a complimentary copy, and I can tell you it is chock full of Prop. 64 information (the lion's share of which will already be familiar to regular readers of this blog).
    Thursday, April 21, 2005
     
    Depublication requests filed in Frey v. TransUnion and Thornton v. Career Training Center
    According to the Court of Appeal dockets, depublication requests were filed with the Supreme Court last week in Frey v. TransUnion Corp., 127 Cal.App.4th 986 (2005) (Fourth Appellate District, Division Three) and in Thornton v. Career Training Center, Inc., ___ Cal.App.4th ___ (April 4, 2005) (Fourth Appellate District, Division One). Neither case shows up on the Supreme Court's docket yet. The depublication requests will ensure that the Supreme Court looks at these cases along with the rest of the published opinions on the Prop. 64 retraoctivity question, all of which are already before that Court in one way or another.
     
    Another unpublished Prop. 64 opinion: Tucker v. AT&T Wireless
    Yesterday, the Fourth Appellate District, Division Three, issued another unpublished opinion in which it held that Prop. 64 applies to cases filed before its effective date. Tucker v. AT&T Wireless Servs., Inc., case no. G034038.
    Wednesday, April 20, 2005
     
    New Supreme Court review petition: Lytwyn v. Fry's Electronics
    UPDATE: After writing the post below, I was informed that no petition for review was filed and that what has actually happened is the Supreme Court reached out sua sponte to consider granting review in Lytwyn v. Fry's Electronics, Inc., 126 Cal.App.4th 1455 (2005). See Rule of Court 28.2(c). That is almost unheard of and is extremely significant. I will post more here if/when I learn anything else.

    ORIGINAL POST: Many thanks to the reader who alerted me to another petition for review raising the Prop. 64 retroactivity issue: Oddly, the docket does not indicate when the review petition was filed, but it does say that on Friday, April 15, the Supreme Court gave itself additional time, through May 23, to grant or deny review. The main case screen says that the case was commenced last Friday, but that does not seem very likely, because the review petition would have been due by April 1. In any event, we now know that the Supreme Court has given itself more time to act in two different Prop. 64 retroactivity cases in a two-day period last week, which suggests that the Justices are looking at the issue very closely. The Court of Appeal's opinion in Lytwyn v. Fry's Electronics, Inc., 126 Cal.App.4th 1455 (2005), is accessible here.
    Tuesday, April 19, 2005
     
    Upcoming MCLE program on the UCL, Prop. 64, and the Class Action "Fairness" Act
    On May 10, 2005, I will be speaking at an MCLE seminar in San Francisco entitled "Unfair Competition Claims 2005: The Impact of Proposition 64 and the Class Action Fairness Act on California Section 17200 Claims," presented by the Practicing Law Institute.

    My co-speakers will be San Francisco County Superior Court Judge Richard A. Kramer (author of a key order on Prop. 64 non-retroactivity); Paul J. Riehle of Sedgwick, Detert, Moran & Arnold; Emily Maxwell of DLA Piper Rudnick Gray Cary; and Bruce L. Simon of Cotchett, Pitre, Simon & McCarthy. I am looking forward to working with all of them, especially Judge Kramer, and I hope that many of my readers will sign up to attend!
    Monday, April 18, 2005
     
    Supreme Court development
    On Thursday, the Supreme Court gave itself 30 additional days, until May 13, 2005, to grant or deny review in Mastercard Int’l, Inc. v. Superior Court (Cal. Supreme Court case no. S131416). As you may recall, that review petition challenges San Francisco Superior Court Judge Richard A. Kramer’s first order holding that Prop. 64 does NOT apply to pending cases. Under Rule of Court 28.2(b), no further extensions are allowed, so if the petition is not granted by May 13, it will be deemed denied. This appears to be the only Prop. 64 case in which the Supreme Court has taken any action lately.
     
    "Applying Proposition 64 to Pending Cases: The Consumers' Prospective; The Business Defendants' Perspective"
    The Spring 2005 issue of the Association of Business Trial Lawyers Report (Los Angeles edition) has two lengthy and well-done articles on the two sides of the Prop. 64 retroactivity question. The Northern California edition of the Spring 2005 issue also has an article on the UCL and Prop. 64: "Section 17200: Reform Comes in from the Cold." And, last but not least, the most recent issue of the San Diego edition also features two opposing articles on Prop. 64 retroactivity.
    Friday, April 15, 2005
     
    80 more bloggers weigh in on freedom of the press
    SoCal Law Blog reports here that the Bear Flag League, a group of 80 California bloggers, has filed an amicus brief in support of the blogger-petitioners in O'Grady v. Apple Computer, Inc. (Sixth Appellate District, case no. H028579). I took a quick look at the brief, and it reads very well. So far, there is no indication in the docket that any amicus parties have stepped forward to support Apple. For more on the case, including the amicus brief filed on behalf of myself and a couple dozen other bloggers, please visit this link.
     
    New Prop. 64 trial court order: Bosch v. Kia Motors
    A reader writes in:
    On 3/29/2005, Judge A. Rex Victor in Dept. S-15 of the San Bernardino Superior Court took judicial notice of Proposition 64 and applied it retroactively to sustain a demurrer in Bosch v. Kia Motors, et al. (SBSC Case No. SCVSS92702). The Court's minute order on the SBSC web-site provides:
    COURT FINDS: REQUEST TO TAKE JUDICIAL NOTICE OF PROP 64 GRANTED. DEMURRER BY SHAVER DEFENDANTS TO THE 3RD AMENDED COMPLAINT IS SUSTAINED WITH 30 DAYS LEAVE TO AMEND AS TO THE 8TH, 10TH AND 11TH CAUSES OF ACTION. DEMURRER IS SUSTAINED WITHOUT LEAVE TO AMEND AS TO THE 6TH CAUSE OF ACTION. ...
    This case was initially filed in 2002. In December, plaintiffs amended to add new causes of action, so defendants demurred to 8th and 11th causes of action (B&P 17200 and 17500, respectively) based upon Prop 64 and their lack of standing. Plaintiffs have been granted leave to try to plead injury in fact and loss of money or property on these causes of action.
    Many thanks for sharing that information. It will be added to my list of Prop. 64 trial court orders.
     
    "Blogs - Cutting Edge or Bleeding Edge?"
    I'm looking forward to tomorrow, when I will be speaking at the annual Spring Institute of the Northern California Association of Law Librarians. The Institute is called "The Future of Legal Research: Legal Resources and Access Today and Tomorrow." Blogger-librarians Mary Minow and Susan Nevelow Mart will be joining me, along with Karen Schneider of the Librarians' Index to the Internet, in presenting "Blogs - Cutting Edge or Bleeding Edge?"
    Thursday, April 14, 2005
     
    New unpublished UCL decision: Schulz v. Neovi Data Corp.
    On Monday, the Fourth Appellate District, Division Three, issued another unpublished decision on the Prop. 64 retroactivity question. Schulz v. Neovi Data Corp., case no. G033879 (aka Schulz v. Ginix Corp.). This was one of the cases in which the Court asked for letter briefs on Prop. 64 shortly after Election Day. No surprise, the Court followed Benson in holding that Prop. 64 applies to pending cases.

    What's more interesting about this decision is its holding that a defendant can be liable under the UCL if it aided and abetted others in committing an unfair business practice. The Schulz court held that Emery v. VISA International Service Assn., 95 Cal.App.4th 952 (2002), did not stand for the proposition that the UCL precludes aider and abettor liability. (Slip op. at 10-11.) Emery is the only other case that I'm aware of in which an appellate court addressed that issue, but as I reported just over a year ago, Emery has been read by some as holding that aiding and abetting is not a viable theory of UCL liability. Schulz confirms that such a reading of Emery is incorrect. Moreover, in Schulz, unlike Emery, the court held that the plaintiff had alleged sufficient facts to proceed under an aiding and abetting theory. For these reasons, I think the second half of the Schulz opinion either "establishes a new rule of law" or "applies an existing rule to a set of facts significantly different from those stated in published opinions" (Cal. Rule of Court 976(c)(1)). A request for partial publication would be very appropriate.
     
    New review petition: FATE v. Superior Court
    According to the First District's docket, a petition for review was filed this week in Foundation Aiding the Elderly v. Superior Court. (The review petition does not yet show up in a search of the Supreme Court's docket.) This is the case in which the First District reaffirmed its view that Prop. 64 does not apply retroactively to pending cases. Unfortunately, the opinion is unpublished. According to the reader who informed me of this development, "[t]hey asked for a 'grant and hold' pending the outcome [of the petition for review] in Mervyn’s." Many thanks for that information. Now, the Prop. 64 retroactivity issue has been raised in at least seven pending Supreme Court review petitions, as well as in the Kids Against Pollution case, in which review was granted some time ago and in which supplemental briefs on Prop. 64 have been filed.
     
    New appellate brief
    I've received a copy of the petition for review in Duran v. Superior Court (May Dept. Stores), Cal. Supreme Court case no. S132689. The brief is quite good and has been added to my list of Prop. 64 appellate briefs.
    Wednesday, April 13, 2005
     
    New pending appeal involving Prop. 64 retroactivity: Privacy Rights Clearinghouse v. JetBlue
    I have been informed of another pending appeal in which the Prop. 64 retroactivity issue has reportedly been raised:
    On 4/8/05, in Privacy Rights Clearinghouse et al. v. Jetblue Airways Corporation et al., Fourth District Court of Appeal, Division 1, Case Number D045568, JetBlue moved to dismiss the appeal based on Proposition 64. The trial court sustained a demurrer without leave to amend holding that the plaintiffs' UCL claims were preempted by the Airline Deregulation Act. Plaintiffs appealed and their opening brief was "due" 4/11/05. Jetblue moved to dismiss the appeal and plaintiffs' response to the dismissal motion is due 4/25/05.
    (Hyperlink added.) Thank you to the reader who forwarded that information. The Prop. 64 retroactivity issue has been essentially resolved within the Fourth District, so this case is unlikely to make new law unless it's procedurally distinctive in some way that's not apparent from the docket. Nonetheless, the case has been added to my list of pending Prop. 64 appeals.
     
    New blog page: Pending Supreme Court appeals involving the UCL
    Over the weekend, I created a new page for the blog that lists all of the pending Supreme Court cases that I'm aware of in which review has been granted and in which one or more UCL issues are to be decided. (The new list does not include cases involving the Prop. 64 retroactivity issue, which are catalogued separately here.) One of the cases, Snowney v. Harrah's Entertainment, has been scheduled for oral argument on May 3, 2005 at 9:00 a.m. In that case, the Supreme Court will decide the following issue:
    In an action alleging false advertising and unfair business practices, are Nevada hotels subject to personal jurisdiction in California based on advertising in the state, maintaining a toll-free telephone number for accepting reservations from within the state, and maintaining an internet website capable of processing online reservations of California residents?
    If you know of any other pending Supreme Court cases involving the UCL in which review has been granted, please drop me a line. Also, if you have copies of any of the briefs in these cases, I'd very much like to see them.
    Tuesday, April 12, 2005
     
    Blogger amicus brief filed yesterday in Apple case
    Yesterday, a group of blogger-journalists submitted an application for leave to file an amici curiae brief in O'Grady v. Apple Computer (Sixth Appellate District, case no. H028579). I decided to throw my hat in the ring, and signed on to the brief as an amicus. As I've explained in prior posts, I have very strong feelings about the free press implications of the trial court's order. I find myself in very good company, as a number of prominent blogger-journalists have also signed on. Please visit the Electronic Frontier Foundation's website for more information on the case, including a list of the amici parties with links to their blogs.

    UPDATE: Shall I compare myself to Julia Roberts, who forgot to thank Erin Brockovich? My sincere thanks to Lauren Gelman of the Stanford Law School Center for Internet & Society, who worked very hard drafting the blogger brief and did an excellent job.
     
    List of Prop. 64 briefs updated
    I've updated my list of Prop. 64 appellate briefs to include about ten more that I've received over recent weeks. All of the new briefs were mentioned in prior blog posts. The list is now organized alphabetically by case name. If you have an appellate brief on any UCL issue and would like to see it mentioned here, please send me a copy.
     
    "Blogs: The Great Equalizer in Marketing Attorney Expertise"
    The Winter/Spring 2005 issue of San Francisco Attorney (published by the Bar Association of San Francisco) has an excellent article on using blogs for legal marketing. It's unfortunate that the article is not available online, because it's one of the best I've read on the subject. Here's a brief excerpt:
    In the blogosphere (aka the Internet), the size of a firm and the marketing budget lose power. Blog users want smart, relevant content, which can come from a solo practitioner or a megafirm. Through a blog, all lawyers compete on an equal playing field. .... Because the Web is not yet saturated with [legal] blogs, the first-to-market benefit still exists for most topics[, but] will not last long.
    The article is by David Bruns, director of marketing for Farella Braun + Martel LLP.
    Monday, April 11, 2005
     
    And then there were seven
    Another petition for review has been filed in the Supreme Court raising the Prop. 64 retroactivity issue:
    That makes a total of seven pending Supreme Court cases that I'm aware of in which the Prop. 64 retroactivity issue has been raised. The cases are listed in my list of Prop. 64 appeals, which I updated over the weekend. If you know of other cases, please drop me a line.
    Sunday, April 10, 2005
     
    "Call Them What You Will, Bloggers Won't Shut Up"
    Today's Los Angeles Times has the story. Also, last week a large group of traditional journalism organizations filed an amicus brief supporting the bloggers in O'Grady v. Apple Computer, Inc., Sixth Appellate District, case no. H028579. For more updates on that case, click here.
    Wednesday, April 06, 2005
     
    Looking for a Job? Prop. 64 forces AG to expand its ranks of environmental lawyers
    A reader kindly passed on this information:
    I attended a Sacramento County Bar Public Law & Administrative Law Section Joint luncheon today, at which Bill Lockyer, Attorney General of the State of California, spoke on "Raise the Shields: Environmental Protection in a Post-Proposition 64 California."

    While he certainly seems committed to protecting the environment, he spent very little time speaking about the effect of Prop 64. However, for any of your readers who may be interested, his main point seemed to be that Prop 64 was resulting in the AG’s office having a much heavier environmental case load than before, as private litigators have been foreclosed from handling non-monetary injury cases. He clearly stated that the AG’s office will be hiring many more environmental law attorneys.

    Thought you might want to pass that tidbit along to any 17200 practitioner who is interested in working for the AG’s office.

     
    UCL seminar materials available online
    Last week, the Barristers Club of the Bar Association of San Francisco presented a one-hour MCLE program called "Is There Any Bite Left in B & P Section 17200? Unfair Competition Lawsuits After Proposition 64." The materials from the seminar are now available online. They are very well done and thorough, with strong content on some of the most cutting-edge UCL issues. They are, however, a bit defense-oriented (which is not surprising, considering that their author is an attorney at a large defense firm). And finally, they include a very nice plug for this blog!
    Tuesday, April 05, 2005
     
    New Prop. 64 decision: Thornton v. Career Training Center, Inc.
    Yesterday, the Fourth Appellate District, Division One, issued another published opinion in which it reiterated its conclusion that Prop. 64 applies retroactively to pending cases filed before the amendments' effective date. Thornton v. Career Training Center, Inc., ___ Cal.App.4th ___ (April 4, 2005). Given the reports I received on the oral argument in this case, that is not a surprise. Many thanks to the reader who emailed me about this development.
    Monday, April 04, 2005
     
    The First District sticks to its guns on Prop. 64 retroactivity
    As I reported late last Friday, the First Appellate District, Division Four, has reaffirmed its holding in Mervyn's. In an unpublished opinion, that Court reversed Judge Sabraw's order in the FATE cases in Alameda County. Foundation Aiding the Elderly v. Superior Court, First Appellate District, Division Four, case no. A109442.

    This is not the only development in the First District. On February 3, Division Five denied a writ petition challenging Judge Kramer's first non-retroactivity order. Mastercard Int'l, Inc. v. Superior Court, First Appellate District, Division Five, case no. A108995. (A petition for review is now pending in that case. See Mastercard Int'l v. Superior Court, Cal. Supreme Court case no. S131416.) Last week, on March 30, Division One issued an order to show cause why the writ petition should not be granted in the other case in which Judge Kramer issued a similar order. Hartford Fire Ins. Co. v. Superior Court, First Appellate District, Division One, case no. A109257. At least two other cases are now pending in the First District in which the parties raised the Prop. 64 retroactivity issue in supplemental briefs. Wilson v. Brawn of California, First Appellate District, Division One, case nos. A105461, A106367; Dunham v. Memberworks, Inc., First Appellate District, Division Five, case no. A107261. It will be interesting to see how this plays out.
     
    UCL statutory penalties as a cross-check for punitive damages
    In Boeken v. Philip Morris, Inc., ___ Cal.App.4th ___ (Apr. 1, 2005), the Court of Appeal (Second Appellate District, Division Four) referred to the UCL by analogy in assessing the appropriate measure of punitive damages in a products liability case:
    California also imposes civil fines for “any unlawful, unfair or fraudulent business act or practice.” (Bus. & Prof. Code, § 17200.) Although the record contains no evidence of typical fines for unlawful or unfair business practices, we may consider not only civil penalties that are actually imposed, but those that are authorized in comparable cases. (State Farm, supra, 538 U.S. at p. 418.) A $2,500 civil penalty may be assessed for each violation. (Bus. & Prof. Code, § 17206, subd. (a).) Boeken smoked two and one-half packs of Marlboros per day for 43 years, approximately 40,000 packs, as a result of Philip Morris’s continuing fraud. If the sale of each pack to Boeken were considered a violation, fines authorized by statute could amount to nearly twice the $100 million in reduced punitive damages confirmed by the trial court in this case.
    (Slip op. at 70.) The Court of Appeal reduced the jury's $3 billion punitive damages award to $50 million, sticking with the "single-digit multiplier" limit adopted by the federal Supreme Court in State Farm. I think this language also suggests that the defendant's fraudulent marketing of its cigarettes violated the UCL as well the common-law theories that the plaintiff raised. The common-law remedies are far broader than those available under the UCL, so that was definitely the best route for the plaintiff to take here. If this had been a UCL case, the purchase price of the cigarettes (or at least the portion of the purchase price that Philip Morris received) would have been restored to the plaintiff as "restitution."
    Friday, April 01, 2005
     
    BREAKING NEWS: First District reaffirms Mervyn's
    In an unpublished opinion issued this afternoon, the First Appellate District, Division Four, reversed Judge Sabraw's order in the FATE cases. Foundation Aiding the Elderly v. Superior Court, case no. A109442. The opinion reads, in relevant part:
    We have previously set forth our determination that Proposition 64 does not apply to lawsuits filed before its effective date of November 3, 2004, and need not repeat that analysis. (Californians for Disability Rights v. Mervyn’s, supra, 126 Cal.App.4th at pp. 391-397.) We are aware that several courts of appeal disagree with us, as Covenant Care points out. (Bivens v. Corel Corp. (2005) 126 Cal. App.4th 1392, 1402-1405; Benson v. Kwikset Corp. (2005) 126 Cal.App.4th 887, 900-907; Branick v. Downey Savings & Loan Assn. (2005) 126 Cal.App.4th 828, 840-844.) The disagreement is founded upon an apparent conflict in canons of statutory construction and is unlikely to be resolved until our Supreme Court clarifies whether the general presumption of prospectivity applies to all legislation, as we believe, or applies only when the legislation modifies common law rights or modifies statutory rights short of a repeal or partial repeal, as some others believe.

    Our belief that the prospectivity presumption applies to all legislation is based upon our high court’s past application of that presumption to both modifications of common law (Evangelatos v. Superior Court (1988) 44 Cal.3d 1188, 1208), and statutory repeals (Myers v. Philip Morris Companies, Inc. (2002) 28 Cal.4th 828, 839-848). We are also concerned that adoption of the statutory repeal exception advocated by Covenant Care would complicate the process of statutory construction by requiring courts to determine whether rights affected by new legislation are founded in common law or statute, and whether the legislation should be characterized as a repeal or partial repeal, as opposed to a revision. Such inquiries take the courts far afield from what should be the guiding principle when interpreting propositions: voter intent. It is the intent of the People, not formulaic standards, that should determine the reach of legislation.
    The opinion ends by stating: "Respondent shall issue a new order denying the motion. To permit Covenant Care an opportunity for immediate review, this decision shall be final in this court upon filing. (Cal. Rules of Court, rules 24(b)(3), 28(e)(1).)" I think we will see a lot of publication requests because it is quite clear that some lower court judges are deciding the Prop. 64 retroactivity question based solely on the fact that more appellate decisions favor retroactive application than reject it. Many thanks to the readers who brought this development to my attention. (And check back here later for a copy of the petitioners' excellent brief in this case, which I have received and will be posting online shortly.)

    UPDATE:
    Here is the writ petition in FATE v. Superior Court. It's one of the best I've seen. And here are several other briefs I've received within the past few days:

     
    Another Prop. 64 hypothetical
    A reader poses this hypothetical:
    Client A sues defendants A, B & C for violation of B&P 17200. Assume the claim is valid. For reasons which are complicated, let's just say there have been several owners of the same business operations over the statutory period. The owners have owned not just the business with which plaintiff has a transaction, but also others. She has standing for an act committed by defendant A, about which there is no issue. Plaintiff is informed and believes that defendants B & C also commit and have committed such acts, but B& C were not involved with the operation which A ran when plaintiff was injured. Assume there is no successor liability.

    Understanding that Prop 64 requires standing such that actual and monetary damages must be suffered and class action requisites must be met, does her standing for A allow her to sue B&C as well?

    Maybe I have overthought this, but what I guess I'm asking/saying is that Prop. 64 does not specifically require that the actual and monetary damages suffered be caused by any particular defendant. Can we say that if one suffers the mandatory injuries from the unfair act, the plaintiff has standing against anyone doing the unfair act? Note that, to me anyway, the CCP 382 prerequisite does not change things if my prior supposition is correct.
    I think there's an argument to be made there. I'd look at precedents on class certification because I believe there is caselaw saying that a plaintiff injured by one defendant in a particular way has claims that are "typical" of a broader group which would include class members injured in a somewhat different way. That's a slightly different issue from standing but one that may resonate with judges. Does anyone have any other ideas?

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