Unfair — continued from Previous Page
The UCL after Prop 64 In the early 2000s, the UCL became
a tool subject to the type of abuse that made the Trevor Law Group a household name in California in 2002 and 2003. The abuse was described as a legal shake- down scheme: “Attorneys form[ed] a front ‘watchdog’ or ‘consumer’ organiza- tion. They scour[ed] public records on the Internet for what [were] often ridicu- lously minor violations of some regula- tion or law by a small business, and sue[d] that business in the name of the front organization.” (People ex rel. Lockyer v. Brar (2004) 115 Cal.App.4th 1315, 1317 [9 Cal.Rptr.3d 844].)
Acting in response to both perceived
and real litigation abuses, the electorate passed Proposition 64, an initiative meas- ure approved at the November 2004 gen- eral election. Proposition 64’s stated pur- pose was to respond to abuses of the UCL as well as the FAL by certain lawyers, who were bringing “frivolous lawsuits against small businesses even though they had no client or evidence that anyone was damaged or misled.” (Ballot Pamp., General Elec. (Nov. 2, 2004) Ballot Argument in Favor of Prop. 64, p. 40.) Proposition 64 imposed new restric- tions on private enforcement under the
UCL and the FAL by limiting the uni- verse of those who may enforce their pro- visions. “Where once private suits could be brought by ‘any person acting for the interests of itself, its members or the gen- eral public’ (former § 17204, as amended by Stats. 1993, ch. 926, § 2, p. 5198), now private standing is limited to ‘any person who as suffered injury in fact and has lost money or property’ as a result of unfair competition (§ 17204, as amended by Prop. 64, as approved by voters, Gen. Elec. (No. 2, 2004) § 3. (Californians for Disability Rights v. Mervyn’s, LLC (2006) 39 Cal.4th 223, 227-228, 46 Cal.Rptr.3d 57.)3
Prop 64 and class actions The impact that Proposition 64 has
mediation
had on UCL claims has largely been in the areas of standing both as to individ- ual and class actions and issues of reliance. Now UCL claims may only be asserted if the claimant meets the stand- ing requirements of Section 17204: Actual damages are not permitted
withJeffrey Krivis
for a claim brought under the UCL and awards are restricted to injunctive relief and/or restitution.4
Attorneys’
www.firstmediation.com 16501 VENTURA BLVD., SUITE 606
ENCINO, CA 91436 76 — The Advocate Magazine JANUARY 2012 ENCINO, CA 91436
www.firstmediation.com 16501 VENTURA BLVD., SUITE 606
jkrivis@firstmediation.com TEL: 818.784.4544
FAX: 818.784.1836
jkrivis@firstmediation.com TEL: 818.784.4544
FAX: 818.784.1836
fees are not generally awarded under the UCL, but, “if a plaintiff prevails in an unfair competition law claim, it may seek attorney fees as a private attorney general pursuant to Code of Civil Procedure section 1021.5.” (Walker v. Countrywide Home Loans, Inc. (2002) 98 Cal.App.4th 1158, 1179 [121 Cal.Rptr.2d 79].) There is no counter- vailing provision for an award of attor- ney fees to a successful defendant. (Ibid.) Further, if a provision in a con- tract allows attorneys’ fees to the pre- vailing party and the contract is chal- lenged in an action under the statute, attorneys’ fees may be awarded. (Shadoan v. World Savings & Loan Ass’n. (1990) 219 Cal.App.3d 97, 107-109 [268 Cal.Rptr. 207].) But, attorneys’ fees may not be awarded to a successful defendant pursuant to a reciprocal attorneys’ fees provision in a statute where that statute is merely a predicate to a UCL claim. (Davis v. Ford Motor Credit Corp. (2009) 179 Cal.App.4th
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