The corporate attack on California consumer protection laws suffered a
setback today. The California Supreme Court rejected the tobacco
industry’s attempt to gut consumers’ ability to bring class actions
under one of the state’s consumer protection laws (known as the Unfair
Competition Law or “UCL”). The case stems from a 2004 ballot
proposition, Prop. 64, sponsored by a who’s who of corporate
defendants, that promised to stop frivolous lawsuits. Egged on by
defense lawyers, however, some courts have applied Proposition 64 to
toss legitimate cases altogether.
Prop. 64 changed the requirements for a person who brings a UCL class
action on behalf of others to require that the person was actually
injured and lost money and property as a result of the business’s
unlawful conduct. The California Supreme Court ruling today rejected
the position of the tobacco companies and the lower court and held that
Proposition 64’s standing requirements only apply to the person
bringing the class action, and not the unnamed class members.
But make no mistake: this fight is far from over. Even as it rejected
the industry’s arguments, the Supreme Court put in place new
requirements for persons bringing UCL class actions based on fraud and
false advertising that defendants will try to use to escape
responsibility for their wrongdoing.
Read Consumer Watchdog’s Litigation Team’s summary of today’s decision.
Yesterday the Los Angeles Times reported on the larger campaign to curb consumer class action cases in California, including comments from Consumer Watchdog founder Harvey Rosenfield. You can read that article here.