Justia Consumer Law Opinion Summaries

Petitioners were companies or wholly-owned subsidiaries involved in the manufacture, distribution or sale of pharmaceuticals or generic prescription drugs, including the prescription drug Niaspan. In October 2016, the Orange County District Attorney, representing "the People of the State of California" in association with private counsel, filed a complaint for violations of the California Unfair Competition Law (UCL), alleging that petitioners either entered into agreements or otherwise engaged in conduct that prevented other generic manufacturers from launching their own Niaspan equivalent, causing purchasers and others in California to overpay for the drug. In this writ proceeding, petitioners asked the Court of Appeal to resolve a single issue: whether section 17204 of the UCL "permit[s] a county district attorney to bring a claim that seeks relief for alleged injuries to residents of California counties whom he or she does not represent, based on conduct occurring outside the county he or she serves . . . ." Petitioners argued district attorneys have no authority to prosecute civil actions absent specific legislative authorization, and neither the Government Code, nor Business and Professions Code section 17204, authorized the district attorney of a single county to seek statewide penalties for alleged UCL violations. The Court granted the petition: "[t]hough section 17204 confers standing on district attorneys to sue in the name of the people of the State of California, it cannot constitutionally or reasonably be interpreted to grant the District Attorney power to seek and recover restitution and civil penalty relief for violations occurring outside the jurisdiction of the county in which he was elected. A contrary conclusion would permit the District Attorney to usurp the Attorney General's statewide authority and impermissibly bind his sister district attorneys, precluding them from pursuing their own relief. Thus, in the absence of written consent by the Attorney General and other county district attorneys, the District Attorney must confine such monetary recovery to violations occurring within the county he serves." View "Abbott Laboratories v. Super. Ct." on Justia Law

D.C. Randall, Jr., the dismissal of his operative second amended complaint against Ditech Financial, LLC (Ditech) after the trial court sustained Ditech's demurrer to the complaint without leave to amend. Randall contended the court erred in its ruling as to his causes of action for violation of the federal Fair Debt Collection Practices Act (FDCPA) and for violation of the state unfair competition law (UCL) because these causes of action stated or can be amended to state viable claims. The Court of Appeal concluded the complaint stated a claim under section 1692f(1) of the FDCPA and could be amended to state a claim under section 1692f(6). Consequently, the complaint could also be amended to state a claim under the UCL. Therefore, the Court reversed the trial court and remanded the matter with directions to conduct further proceedings. View "Randall v. Ditech Financial, LLC" on Justia Law

Lujan had a Chase credit card account, governed by an agreement with a provision stating “federal law and the law of Delaware” govern the agreement and a provision for attorney’s fees. When Lujan’s account had an unpaid balance in 2007, Chase assigned its claim to interim assignees. In 2011, PCC filed suit, alleging a debt of $8,831.90. PCC Vice President Shields verified the complaint. Lujan cross-complained against PCC, Shields, and interim assignees seeking damages under the Fair Debt Collection Practices Act, 15 U.S. C. 1692, and the Rosenthal Fair Debt Collection Practices. The court granted Lujan summary judgment as to PCC, applying Delaware’s three-year statute of limitations. On the cross-complaint, the court granted the other defendants summary judgment, finding that none met the statutory definition of a debt collector. The judgment is silent om statutory damages, leaving Lujan with only “attorney fees and costs" as provided by statute. The court awarded Lujan $140,550.51 in fees against PCC but denied the other defendants fees because the cross-complaint was not an action “on a contract” under Civil Code 1717. The appeals court affirmed Lujan’s summary judgment against PCC, Lujan’s award of attorney’s fees, and the interim assignees’ summary judgment and denial of fees. The court reversed summary judgment in favor of Shields and PCC’s attorney. View "Professional Collection Consultants v. Lujan" on Justia Law

A buyer is not a prevailing party entitled to recover attorney's fees under the Song-Beverly Consumer Warranty Act if, through settlement with the manufacturer, all she obtains by litigating is the payment of dealer add-ons for which the manufacturer is not responsible and the payment of attorney’s fees. The Court of Appeal affirmed the denial of attorney's fees in this case where the parties entered into a confidential settlement leaving attorney's fees and costs unresolved. The court modified the judgment to award costs because the buyer obtained a net monetary recovery by virtue of the settlement. View "Garcia v. Mercedes-Benz USA" on Justia Law

At issue in this appeal was whether a mortgage servicer could be considered a "debt collector" under California's Rosenthal Fair Debt Collection Practices Act (the Rosenthal Act; Civ. Code,1 sec. 1788 et seq.). There was a split of authority among the many federal district courts that have considered the issue, and there was “a paucity of California authority addressing the question.” In this case, plaintiff Edward Davidson brought a putative class action against Seterus and its parent company, International Business Machines, Inc. (IBM), alleging that the defendants violated the Act and the Unfair Competition Law (UCL). The defendants demurred to Davidson's complaint, arguing that neither of them was a " 'debt collector' " who engages in " 'debt collection' " under the Act. The trial court sustained the defendants' demurrer, concluding that the defendants "are not 'debt collectors' because servicing a mortgage is not a form of collecting 'consumer debts.' " On appeal, Davidson contended the trial court erred in determining that mortgage servicers were not "debt collectors" under the Rosenthal Act. The Court of Appeal ultimately agreed with Davidson's contention, in no small part due to the Court’s adherence to "the general rule that civil statutes for the protection of the public are, generally, broadly construed in favor of that protective purpose." The Court therefore reversed the trial court and remanded this case for further proceedings. View "Davidson v. Seterus, Inc." on Justia Law

A wine dealer sold millions of dollars’ worth of counterfeit wine to an unsuspecting wine collector. When the collector discovered the fraud, he filed an insurance claim based on his “Valuable Possessions” property insurance policy. The insurance company denied the claim. The collector sued for breach of contract. The trial court ruled in favor of the insurance company, sustaining its demurrer. The Court of Appeal concurred with the trial court: the collector suffered a financial loss, but there was no loss to property that was covered by the property insurance policy. View "Doyle v. Fireman's Fund Insurance Co." on Justia Law

Plaintiff filed suit against CarMax, alleging breaches of express and implied warranties, intentional and negligent misrepresentation, breach of contract, unfair competition under Business and Professions Code section 17200 (UCL), and a violation of the Consumer Legal Remedies Act (CLRA). When plaintiff purchased her car at a CarMax dealership, she was not informed that there was an outstanding safety recall relating to the stop lamp switch in the vehicle. In regard to the alleged breach of the implied warranty of merchantability, the Court of Appeal concluded that CarMax's express limitations on the remedies available applied to such a breach. The court explained that plaintiff obtained the remedy authorized under the contract and its limitations for a breach of warranty. However, plaintiff alleged sufficient facts to establish CarMax engaged in unfair or deceptive practices in violation of the CLRA, and plaintiff pleaded sufficient facts to establish CarMax had a duty to disclose the safety recall. Finally, plaintiff stated a cause of action under the UCL where the violation of the CLRA served as the predicate violation of law necessary to establish the unlawful practice variety of unfair competition that was actionable under the UCL. Therefore, the court reversed the trial court's judgment. View "Gutierrez v. CarMax Auto Superstores California" on Justia Law

Plaintiffs sued Dentsply, Cavitron's manufacturer and marketer, on behalf of California dentists who purchased the Cavitron ultrasonic scaler for use during oral surgical procedures, under the Unfair Competition Law (UCL) (Bus. & Prof. Code, 17200) and for breach of express warranty. Plaintiffs claim that the Directions for Use indicate Cavitrons can be used in “[p]eriodontal debridement for all types of periodontal diseases,” which by implication included oral surgery; in fact, they cannot because the device accumulates biofilm in its waterlines and is incapable of delivering sterile water during surgical procedures. Following a remand, the trial court certified the class, conducted a bench trial, and rejected all claims. The court of appeal affirmed, agreeing that plaintiffs, as licensed dentists, were well aware that biofilm forms in all dental waterlines and that Cavitrons do not produce sterile water. The evidence failed to establish that the class was likely to be misled. The weight of the evidence established that dental professionals did not understand the warranty that the Cavitron was suitable for use in “[p]eriodontal debridement for all types of periodontal diseases,” as a statement that the Cavitron delivered sterile water or water without biofilm. View "Patricia A. Murray Dental Corp. v. Dentsply International., Inc." on Justia Law

Plaintiff Antoinette Rossetta appealed the dismissal of her second amended complaint after the trial court sustained a demurrer by defendants CitiMortgage, Inc. (CitiMortgage) and U.S. Bank National Association as Trustee for Citicorp Residential Trust Series 2006-1 (2006-1 Trust). The complaint asserted multiple causes of action sounding in tort, and unlawful business practices in violation of the Unfair Competition Law arising from loan modification negotiations spanning more than two years. Rossetta also appealed the trial court’s dismissal of a cause of action for conversion that appeared in an earlier iteration of the complaint to which CitiMortgage and the 2006-1 Trust (collectively, CitiMortgage, unless otherwise indicated) also successfully demurred. After review, the Court of Appeal concluded: (1) the trial court erred in sustaining the demurrer to the causes of action for negligence and violations of the Unfair Competition Law; (2) the trial court properly sustained the demurrer to the causes of action for intentional misrepresentation and promissory estoppel, but should have granted leave to amend to give Rossetta an opportunity to state a viable cause of action based on an alleged oral promise to provide her with a Trial Period Plan (TPP) under the Home Affordable Mortgage Program (HAMP) in April 2012; and (3) the trial court properly sustained the demurrer to the causes of action for negligent misrepresentation, breach of contract, intentional infliction of emotional distress and conversion without leave to amend. View "Rossetta v. CitiMortgage, Inc." on Justia Law

In June 2012, plaintiff-appellant Allen Krizhner leased a Mercedes-Benz from defendant Mercedes-Benz USA, LLC for personal use. The complaint alleged the car came with an express written warranty covering repairs for any defects. During the warranty period, the car allegedly exhibited a variety of defects which caused the navigation system and key fob to malfunction, the steering column adjustment mechanism and power seats to be inoperative, the coolant level warning light to illuminate, and smoke to emanate from the cigarette lighter. After bringing the issues to defendant’s attention, and frustrated with defendant’s supposed failure to abide by its warranty obligations, plaintiff filed suit under the Song-Beverly Consumer Warranty Act. Plaintiff accepted an offer of compromise pursuant to Code of Civil Procedure section 998, including a restitution provision identical to Civil Code section 1793.2 (d)(2)(B). The court awarded plaintiff over $47,000 in accordance with the 998 offer. Plaintiff appealed, arguing the trial court erred because it denied him recovery of approximately $680 in vehicle registration renewal and certificate of nonoperation fees which he incurred in the years after he first leased the car. The Court of Appeal concluded the court properly determined section 1793.2(b)(2)(B) did not require payment of vehicle registration renewal fees and related costs incurred after the initial purchase or lease. View "Kirzhner v. Mercedes-Benz USA, LLC" on Justia Law