Articles Posted in California Courts of Appeal

by
In the underlying actions, the People asserted claims under Business and Professions Code section 17501 against real parties in interest and alleged that real parties sold products online by means of misleading, deceptive or untrue statements regarding the former prices of those products. The trial court sustained real parties' demurrer without leave to amend on the ground that the statute was void for vagueness as applied to real parties. The Court of Appeal granted the petition for writ of mandate seeking relief from the ruling regarding the section 17501 claims, and held that real parties failed to demonstrate any constitutional defect on demurrer. Regarding real parties' challenge to section 17501 as an unconstitutional regulation of free speech, as a preliminary matter, the court rejected petitioner's contention that the statute targets only false, misleading or deceptive commercial speech; the plain language of the statute restricts protected commercial speech and thus, the statute was subject to the test for constitutional validity set forth in Central Hudson Gas & Elec. v. Public Serv. Comm'n (1980) 447 U.S. 557, 566; and, because the undeveloped record was inadequate to apply the test, real parties' "free speech" challenge necessarily failed on demurrer. The court also rejected real parties' contention that section 17501 was void for vagueness, and rejected the facial and as-applied challenges. View "People v. Superior Court" on Justia Law

by
Where a business conditions its offer to remedy a violation of the Consumer Legal Remedies Act (CLRA) on the consumer waiving his or her right to injunctive relief and remedies under other statutes and common law, the offer is not an appropriate correction offer as contemplated by Civil Code section 1782, subdivision (b), and does not bar a lawsuit by the consumer. Neither can the business demand as part of its correction offer that the consumer consent to additional settlement terms unrelated to the compensation necessary to make the consumer whole. Plaintiff filed suit alleging that Seidner violated the CLRA, the unfair competition law (UCL), and Civil Code section 1632 (requiring translation of certain contracts), and committed fraud in connection with the company's lease of a vehicle to plaintiff and his wife. The Court of Appeal reversed the trial court's grant of summary judgment in favor of Seidner. The court held that, although Seidner's correction offer was timely, it was not appropriate. The court also held that, to the extent Benson v. Southern California Auto Sales, Inc., (2015) 239 Cal.App.4th 1198, reached a contrary conclusion, the court disagreed with it. In this case, Seidner did not make an appropriate correction offer, and thus failed to meet its burden of showing a complete defense to plaintiff's claims to support the grant of summary judgment. View "Valdez v. Seidner-Miller, Inc." on Justia Law

by
Sixty-nine current and former residents of mobilehome park Terrace View Mobile Home Estates filed a lawsuit against the park's owners, Terrace View Partners, LP, Thomas Tatum, Jeffrey Kaplan, and management company, Mobile Community Management Company (collectively, defendants). The operative first amended complaint, styled as a class action, included 12 causes of action based on allegations that defendants' failure to maintain the park in "good working order and condition" created a nuisance that, along with unreasonably high space rent increases, made it difficult or impossible for park residents to sell their mobilehomes. After the court denied plaintiffs' motion for class certification, the parties and the court agreed to try the case in phases, with the first phase involving 16 residents living in 10 spaces in Terrace View. A first-phase jury returned a special verdict finding defendants liable and awarded the individual plaintiffs economic and noneconomic damages for: intentional interference with property rights, breach of the covenant of good faith and fair dealing, nuisance (based on substantially failing to enforce the park's rules and regulations), breach of contract/breach of the covenant of quiet enjoyment, and negligence/negligence per se. The jury found defendants were not liable for nuisance based on failing to provide and maintain the park's common facilities and physical improvements in good working order and condition, and were not liable for elder financial abuse against five plaintiffs. After the jury was discharged, the court issued an order on plaintiffs' cause of action alleging defendants violated Business and Professions Code section 17200 et seq., the "unfair competition law" (UCL). The court ruled that a "catch-up" provision in defendants' long-term leases that could greatly increase rent at the end of a lease term was unfair in violation of the UCL. The judgment also reflected the court's rulings at the beginning of trial that certain other provisions in the parties' lease agreements violated California's Mobilehome Residency Law or were otherwise unlawful. Defendants appealed. The Court of Appeal concluded the jury's award of compensatory damages and punitive damages had to be reversed. Although the jury's award of economic damages may have included unspecified amounts that could be upheld on appeal if the special verdict form had segregated them, "it is clear from the record that the vast majority of the economic damages awarded represented reimbursement for overpayment of rent and diminution in value of homes caused by high rent. Because the award of such damages cannot be sustained under any of the theories of liability presented to the jury and it is impossible to sever any properly awarded damages from improperly awarded damages." The Court therefore reversed the entire award of compensatory damages and the attendant awards of punitive damages and attorney fees and costs to plaintiffs. View "Bevis v. Terrace View Partners, LP" on Justia Law

by
Plaintiffs-appellants Jamie and Kelly Etcheson brought an action under the Song-Beverly Consumer Warranty Act (commonly known as the "lemon law") against defendant and respondent FCA US LLC (FCA) after experiencing problems with a vehicle they had purchased new for about $40,000. After admitting the vehicle qualified for repurchase under the Act, FCA made two offers to compromise under Code of Civil Procedure section 998: one in March 2015, to which plaintiffs objected and the trial court found was impermissibly vague, and a second in June 2016, offering to pay plaintiffs $65,000 in exchange for the vehicle's return. Following the second offer, the parties negotiated a settlement in which FCA agreed to pay plaintiffs $76,000 and deem them the prevailing parties for purposes of seeking an award of attorney fees. Plaintiffs moved for an award of $89,445 in lodestar attorney fees with a 1.5 enhancement of $44,722.50 for a total of $134,167.50 in fees, plus $5,059.05 in costs. Finding the hourly rates and amount of counsels' time spent on services on plaintiffs' behalf to be reasonable, the trial court tentatively ruled plaintiffs were entitled to recover $81,745 in attorney fees and $5,059.05 in costs. However, in its final order the court substantially reduced its award, concluding plaintiffs should not have continued to litigate the matter at all after FCA's March 2015 section 998 offer. It found their sought-after attorney fees after the March 2015 offer were not "reasonably incurred," and cut off fees from that point, awarding plaintiffs a total of $2,636.90 in attorney fees and costs. Pointing out their ultimate recovery was double the estimated value of FCA's invalid March 2015 section 998 offer, which they had no duty to counter or accept, plaintiffs contended the trial court abused its discretion by cutting off all attorney fees and costs incurred after that offer. The Court of Appeal agreed and reversed the order and remanded back to the trial court with directions to award plaintiffs reasonable attorney fees for their counsels' services, including those performed after FCA's March 2015 offer, as well as reasonable fees for services in pursuing their motion for fees and costs. View "Etcheson v. FCA US LLC" on Justia Law

by
A jury awarded plaintiff-appellant Shirlean Warren $17,455.57 in damages pursuant to California's “lemon law.” In this appeal, Warren challenges her attorney fee award and her costs and expenses award. Warren claims the court abused its discretion in applying a 33% negative multiplier to her requested lodestar attorney fees. Warren argues that, by applying the negative multiplier, the court erroneously limited her attorney fee award to a proportion of her $17,455.57 damages award, and thus used a prohibited means of determining reasonable attorney fees. She also claimed she was entitled to recover prejudgment interest on her damages award and that the court erroneously struck the $5,882 expense for trial transcripts from her cost bill. The Court of Appeal concluded Warren did not show she was entitled to prejudgment interest on her jury award as a matter of right. Nor did Warren show the court abused its discretion in refusing to award any prejudgment interest. The Court agreed, however, that Warren was entitled to recover the $5,882 expense that her attorneys incurred for trial transcripts. View "Warren v. Kia Motors America, Inc." on Justia Law

by
Class actions are not allowed under the Right to Repair Act except in one limited context: to assert claims that address solely the incorporation into a residence of a defective component, unless that component is a product that is completely manufactured offsite. The Court of Appeal held that, because the claim here involved allegedly defective products that were completely manufactured offsite, the claim alleged under the Act could not be litigated as a class action. In this case, homeowners could not bring a class action asserting a claim under the Act against Kohler, the manufacturer of an allegedly defective plumbing fixture used in the construction of class members' homes. Therefore, the court granted Kohler's writ petition and issued a writ of mandate directing the trial court to vacate its order to the extent it denied in part Kohler's anti-class certification motion and to enter a new order granting the motion in its entirety. View "Kohler Co. v. Superior Court of Los Angeles County" on Justia Law

by
Villanueva and the class (Plaintiffs) alleged that Fidelity, an underwritten title company that handled Plaintiffs’ escrow accounts, engaged in unlawful conduct under the Unfair Competition Law (UCL) (Bus. & Prof. Code, 17200) in charging overnight mail delivery fees, courier fees, and document preparation or “draw deed” fees that were not listed in its schedule of rates filed with the Department of Insurance in violation of Insurance Code 12401–12410.10, 12414.27. Fidelity argued that the lawsuit was barred by the statutory immunity in section 12414.26 for matters related to rate-making. The trial court rejected Fidelity’s immunity claim and granted Plaintiffs injunctive relief under the UCL, but denied their restitution claims. The court of appeal reversed. Fidelity’s immunity defense is not subject to the forfeiture doctrine because it implicates the court’s subject matter jurisdiction; this claim is subject to the exclusive original jurisdiction of the Insurance Commissioner because it challenges Fidelity’s activity related to rate-making. The court directed the trial court to enter a new order awarding costs to Fidelity. View "Villanueva v. Fidelity National Title Co." on Justia Law

by
Bayer AG, maker and marketer of One A Day brand vitamins, was sued in California Superior Court for alleged violations of California’s Consumer Legal Remedies Act, Unfair Competition Law and express warranty law. Plaintiff William Brady’s theory was that Bayer’s packaging of its “Vitacraves Adult Multivitamin” line of gummies was misleading. Brady argued that despite the One A Day brand name, these particular vitamins require a daily dosage of two gummies to get the recommended daily values. Thus buyers end up receiving only half the daily vitamin coverage they think they are getting. The initial complaint was filed as a class action in March 2016, followed by an amended complaint in April, followed by a demurrer in May. The trial court, relying on the unpublished Howard v. Bayer Corp., E. D. Ark. July 22, 2011 (2011 U. S. Dist. LEXIS 161583) involving the supposedly misleading packaging of Bayer’s One A Day gummies, sustained Bayer’s demurrer without leave to amend. The Court of Appeal concluded Bayer failed to appreciate the degree to which their trade name One a Day has inspired reliance in consumers, and held an action alleging they violated California’s Consumer Legal Remedies Act, Unfair Competition Law and express warranty law should have survived demurrer. View "Brady v. Bayer Corp." on Justia Law

by
Plaintiff Alfredo Fuentes entered into a written agreement with defendant TMCSF, Inc., doing business as Riverside Harley-Davidson (Riverside), to buy a motorcycle. At the same time, he entered into a written agreement with Eaglemark Savings Bank (Eaglemark) to finance the purchase. The loan agreement included an arbitration clause; the purchase agreement did not. Fuentes then filed suit against Riverside, alleging that Riverside made various misrepresentations and violated various statutes in connection with the sale of the motorcycle. Riverside petitioned to compel arbitration. The trial court denied the petition. The Court of Appeal held Riverside was not entitled to compel arbitration because it was not a party to the arbitration clause, it was not acting in the capacity of an agent of a party to the arbitration clause, and it was not a third party beneficiary of the arbitration clause. Moreover, Fuentes was not equitably estopped to deny Riverside’s claimed right to compel arbitration. View "Fuentes v. TMCSF, Inc." on Justia Law

by
Plaintiff filed suit against electronic retailer Newegg.com, alleging claims of false advertising under the (UCL), false advertising law (FAL), and Consumers Legal Remedies Act (CLRA). Plaintiff contended that Newegg.com used fictitious former price information in its advertisements that mislead customers to believe they were receiving merchandise at a discounted price. The Court of Appeal reversed the trial court's judgment sustaining Newegg's demurrer without leave to amend, holding that plaintiff had standing to pursue his claims. In this case, plaintiff satisfied the UCL and FAL's standing requirements by alleging that Newegg advertised that its products were being offered at a discount from their former or original price; these representations were false or misleading; plaintiff saw and relied on the former price representations when purchasing the products; and he would not have purchased the products but for the false former price representations. Because the court concluded that plaintiff adequately alleged an economic injury for purposes of UCL standing, he likewise had standing to pursue his CLRA claim. View "Hansen v. Newegg.com Americas, Inc." on Justia Law