The UCL Practitioner
Friday, July 02, 2004
UCL/CLRA judgment affirmed 2-1 with brutal dissent
In Benson v. Kwikset Corporation, ___ Cal.App.4th ___ (Jun. 30, 2004), which was decided Wednesday but not posted to the court's website until yesterday, the Court of Appeal reaffirmed two points relating to proof in UCL and CLRA cases. First, it confirmed that the "reasonable consumer" standard applies. Slip op. at 16-17 (citing Consumer Advocates v. Echostar Satellite Corp., 113 Cal.App.4th 1351 (2003)). Second, it confirmed that statistical or survey evidence is not required to establish a false advertising or other "fraudulent" prong claim under the UCL. Slip op. at 17-19 (citing Brockey v. Moore, 107 Cal.App.4th 86 (2003)). Then, the court had some harsh words for the UCL:
We share our dissenting colleague's angst about both the effect of this law, particularly in an age of global trade, and the potential for abuse that may arise under the UCL. If we had the power to do so, we would rewrite the statute to address those concerns.
Slip op. at 15. But that was nothing compared to the dissent:
Today’s majority decision only confirms the critics’ worst caricature of California’s unfair competition law (Bus. & Prof. Code, § 17200 et seq.)—that it has degenerated into nothing but a feeding frenzy for attorneys who use the law to shake down California businesses and chase jobs out of California. .... There has been no injury. No breach of contract. No one got hurt. The only money to change hands is the multimillion dollar windfall to the attorneys who brought this action if today’s decision is allowed to stand. And what has been accomplished by this litigation other than the enrichment of the plaintiffs’ attorneys? The only real results are negative, and especially negative to American workers. .... What is the difference between the $3 million attorney fees award here and the petty shakedowns which made the Trevor Law Group infamous in Southern California? Nothing but the size of the law firm and its target. .... Thus, if the Trevor Law Group sues an auto body shop over not having its license up to date, that is an abuse of the unfair competition law. But if a more established law firm sues a big corporation over an equally trivial putative violation—it is rewarded with $3 million in fees. The net result is to bless the same kind of abuse in which the Trevor Law Group engaged—looking for a hypertechnical violation of some law by a California business and then going after that business under section 17200 as a profit-making venture—with appellate holy water. .... The unfair competition law is not a bad law, but today it has been abused. One can only hope that the issue will be visited by our Supreme Court as soon as possible.
Slip dissent at 1, 7-9 (emphasis in original). That hurts, but $3 million will soothe a lot of wounds. Still, how long before we see something like this in a published majority opinion?
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