Justia California Court of Appeals Opinion Summaries

This case pertains to the enforcement of the California Privacy Rights Act of 2020 (the Act), a voter-enacted statute that expanded and amended the California Consumer Privacy Act of 2018. The California Privacy Protection Agency (the Agency) failed to adopt final regulations by the July 1, 2022 deadline set out in the Act. The California Chamber of Commerce sought a court order to delay enforcement of the Act until one year after the agency adopted all required regulations. The trial court granted the petition in part, ruling that the Agency could not enforce any regulation until one year after that regulation became final. The Agency appealed, arguing that the Act did not mandate a one-year delay between the approval of a final regulation and its enforcement. The appellate court agreed with the Agency, finding that the Act's language did not unambiguously require a one-year delay between approval and enforcement. The court ordered a new trial court order denying the Chamber's petition and allowing the trial court to consider any remaining issues regarding the prompt development of regulations. View "California Privacy Protection Agency v. Superior Court" on Justia Law

Charles Ramsey, a subscriber to Comcast Cable Communications, LLC’s Xfinity services, filed a lawsuit against Comcast for violations of California’s consumer protection statutes. He alleged that Comcast engaged in unfair, unlawful, and deceptive business practices under the Consumers Legal Remedies Act (CLRA) and the unfair competition law (UCL). Ramsey’s complaint sought injunctive relief, not monetary damages. Comcast filed a petition to compel arbitration pursuant to the arbitration provision in the parties’ subscriber agreement which required the parties to arbitrate all disputes and permitted the arbitrator to grant only individual relief. The trial court denied the petition based on the Supreme Court’s decision in McGill v. Citibank, which held that a predispute arbitration provision that waives a plaintiff’s right to seek public injunctive relief in any forum is unenforceable under California law. On appeal, Comcast argued that the trial court erred in concluding that Ramsey was seeking public injunctive relief. Comcast further argued that the Federal Arbitration Act (FAA) preempts McGill. The Court of Appeal of the State of California Sixth Appellate District held that Ramsey’s complaint seeks public injunctive relief, and that McGill is not preempted, thus affirming the trial court’s order. View "Ramsey v. Comcast Cable Communications, LLC" on Justia Law

In a case concerning subsidized low-income housing, the Court of Appeal of the State of California, Second Appellate District, Division Seven, ruled that tenants in such housing developments have standing to sue a property management company under the unfair competition law (UCL) if their tenancies are terminated prematurely due to legally deficient notices. The plaintiffs, who lived in housing managed by FPI Management, Inc., claimed that their tenancies were terminated after FPI provided just three days’ notice, instead of the legally required 30 days’ notice. The trial court granted summary judgment to FPI, deciding that the plaintiffs did not suffer an injury that would confer standing under the UCL. The appellate court, however, held that the plaintiffs were prematurely deprived of property rights and subjected to imminent legal peril due to FPI's legally deficient termination notices. This amounted to an injury sufficient to confer standing under the UCL. The appellate court also noted a distinction between the plaintiffs who lived in housing subsidized by the HOME Investment Partnerships Program (HOME plaintiffs) and those living in housing subsidized by section 8 of the United States Housing Act of 1937 (Section 8 plaintiffs). The Section 8 plaintiffs failed to demonstrate their legal entitlement to 30 days’ notice, leading the court to affirm the trial court's summary judgment in favor of FPI regarding the Section 8 plaintiffs' UCL claim. The court also affirmed the trial court's denial of the plaintiffs' motion for summary adjudication, but reversed the judgment and post-judgment order on costs, rendering the cost order moot. View "Campbell v. FPI Management, Inc." on Justia Law

In a case before the Court of Appeal of the State of California Fourth Appellate District Division Two, the plaintiff, a minor identified as J.R., filed a putative class action against Electronic Arts Inc. (EA), alleging causes of action for unlawful and unfair business practices, violation of the Consumer Legal Remedies Act, and unjust enrichment. J.R. claimed that EA deceptively induced players, particularly minors, to purchase in-game currency for its game, Apex Legends. EA sought to compel arbitration under the terms of its user agreement, which J.R. had accepted to play Apex Legends. The lower court denied EA's motion to compel on the grounds that J.R. had exercised his power under Family Code section 6710 to disaffirm all of his contracts with EA, including the arbitration agreement. EA appealed, arguing that an arbitrator, not the court, should decide issues of arbitrability due to a delegation provision within the agreement. The appellate court rejected EA's arguments, affirming the lower court's decision. The court held that J.R.'s disaffirmance of "any... contract or agreement" accepted through his EA account was sufficient to challenge the validity of the delegation provision specifically, thereby authorizing the court to assess the validity of J.R.'s disaffirmance. View "J.R. v. Electronic Arts" on Justia Law

In this case, consumers brought tort claims against a mattress retailer and manufacturer, alleging injuries suffered while sleeping on a defective mattress. The plaintiffs settled with the retailer and later dismissed their claims against the manufacturer, Tempur-Pedic North America, LLC, before filing a new lawsuit. The manufacturer then moved for costs as the prevailing party in the dismissed lawsuit. The trial court awarded some costs to the manufacturer, including costs for depositions that were noticed but did not occur. The consumers appealed this decision, arguing it was improper to award costs for depositions that did not occur.The Court of Appeal of the State of California Fourth Appellate District Division Two disagreed with the consumers and affirmed the trial court's decision. The appellate court held that there is no blanket exception to awarding costs for depositions that were noticed but did not occur. The court explained that the proper analysis focuses on whether costs were reasonably necessary to litigating a case when incurred, not whether the costs could have been avoided in retrospect. The court found that the trial court did not abuse its discretion in finding the costs were reasonably necessary. View "Garcia v. Tempur-Pedic North America, LLC" on Justia Law

In California, plaintiff Jasmine Moten appealed the trial court’s decision to grant an anti-SLAPP motion filed by defendant, Transworld Systems Inc. (Transworld). Moten had taken out a student loan which she later defaulted on, leading to Transworld, a debt collection company, servicing the loan. Transworld filed a debt collection action against Moten on behalf of National Collegiate Student Loan Trust 2007-3 (NCSLT 2007-3), to whom the loan had been assigned. Moten filed a class action lawsuit against Transworld, alleging that it did not have a valid legal claim as it had manufactured documents to prove ownership of the loan by NCSLT 2007-3. She claimed that these deceptive practices violated the Robbins-Rosenthal Fair Debt Collection Practices Act and the Federal Fair Debt Collection Practices Act, as well as Unfair Competition and Unlawful Business Acts and Practices. The trial court granted Transworld's anti-SLAPP motion, which led to Moten's appeal. The Court of Appeal for the State of California Fourth Appellate District Division Two reversed the trial court’s decision, ruling that the trial court erred in applying the litigation privilege to Moten's claims. The appellate court remanded the case back to the trial court to determine whether Moten has a probability of prevailing on her claims and to consider the public interest exception of Code of Civil Procedure section 425.17. View "Moten v. Transworld Systems Inc." on Justia Law

In the case between Lisa Stettner, Michele Zousmer and Mercedes-Benz Financial Services USA, LLC, the dispute centered on a vehicle turn-in fee that Mercedes-Benz charges at the end of their lease agreements. Stettner and Zousmer considered this fee to be taxable and filed a suit accusing Mercedes-Benz of violating California’s Unfair Competition Law and for declaratory relief.However, the Court of Appeal of the State of California Third Appellate District found that the plaintiffs did not exhaust their administrative remedies before bringing the lawsuit, which is a prerequisite for a taxpayer to challenge the validity of a tax in court. Moreover, the court ruled that the plaintiffs were not entitled to a judicial remedy because there was no prior legal determination resolving the taxability issue.The court also stated that the trial court was correct to deny the plaintiffs' request to amend their complaint to include a copy of the lease agreements. The court found that the definition of the vehicle turn-in fee in the lease agreements did not rectify the defects in the plaintiffs' first amended complaint. Therefore, the court affirmed the trial court’s order sustaining the demurrers. View "Stettner v. Mercedes-Benz Financial Services USA, LLC" on Justia Law

In the state of California, an individual named Chad Grayot purchased a used vehicle from a car dealership with a contract that was later assigned to the Bank of Stockton. This contract included the Federal Trade Commission's 'Holder Rule' notice, which allows a consumer to assert against third party creditors all claims and defenses that could be asserted against the seller of a good or service. Grayot sought to hold the Bank responsible for refunding the money he paid under the contract based on the holder provision in the contract. The Bank argued that it could not be held responsible because it was no longer the holder of the contract as it had reassigned the contract back to the dealership. The trial court granted summary judgment in favor of the Bank, accepting its argument. Grayot appealed this decision.The Court of Appeal of the State of California Third Appellate District reversed the trial court's decision. The appellate court held that a creditor cannot avoid potential liability for claims that arose when it was the holder of the contract by later reassigning the contract. This interpretation of the Holder Rule is in line with the Federal Trade Commission's intent to reallocate any costs of seller misconduct to the creditor. The court sent the case back to the lower court for further proceedings consistent with its opinion. View "Grayot v. Bank of Stockton" on Justia Law

In 2017, the plaintiffs leased a Mercedes-Benz B250E from a dealer. In 2020, at the end of the lease, they signed a Retail Installment Sales Contract (RISC) with the dealer to finance the purchase of the vehicle. Both the lease and the RISC contained arbitration agreements.The plaintiffs allege that Mercedes-Benz USA (MBUSA), as the manufacturer or distributor of the vehicle, provided them with two express warranties and a separate implied warranty of merchantability and that the vehicle had undisclosed defects covered by the warranties, They took the vehicle to the dealer, which was authorized by MBUSA for repairs, but despite multiple attempts, the vehicle could not be fixed. The plaintiffs filed suit, alleging violations of the Song-Beverly Consumer Warranty Act. MBUSA moved to compel arbitration, arguing that it had standing to compel arbitration as a third-party beneficiary of both the lease and the RISC, and equitable estoppel. While the trial court rejected MBUSA’s argument that it was a third-party beneficiary of the agreements, it agreed with MBUSA’s equitable estoppel argument. The court of appeal reversed. MBUSA is not a party to the agreements with the vehicle dealer and the claims against MBUSA are not intertwined with those agreements. View "Yeh v. Superior Court of Contra Costa County" on Justia Law

Plaintiff Phil Hagey appealed a judgment of dismissal entered following the sustaining of a demurrer to his second amended complaint without leave to amend. Plaintiff owned a home with a solar energy system (the system). At the time he purchased the home, the prior homeowner was party to a contract with a company, Kilowatt Systems, LLC (Kilowatt), which owned the system (the solar agreement). Among other terms, the solar agreement required the prior homeowner to purchase the energy produced by the system through monthly payments to Kilowatt. In the event of a sale of the house, the solar agreement afforded the prior homeowner three options. The prior homeowner and plaintiff agreed to an option which allowed prepayment of all remaining monthly payments and a transfer of all solar agreement rights and obligations to plaintiff, except for the monthly payment responsibility. In conjunction with the sale of the house, prepayment occurred and the parties entered into the requisite transfer agreement. At some later point in time, defendant Solar Service Experts, LLC began sending plaintiff monthly bills on Kilowatt’s behalf, demanding payments pursuant to the solar agreement. After receiving a bill, plaintiff spoke to a representative of defendant who told him he should not have received the bill and the issue would be resolved. Plaintiff received additional bills and at least one late payment notice which identified defendant as a debt collector. Plaintiff communicated with defendant’s representatives about the errors by phone and email, all to no avail. Plaintiff thereafter filed a class action lawsuit against defendant. The trial court concluded plaintiff did not, and could not, allege facts sufficient to constitute a consumer credit transaction, as statutorily defined. Plaintiff argued the court erroneously focused on the undisputed fact he did not owe the debt which defendant sought to collect and, in doing so, failed to recognize the Rosenthal Act applied to debt alleged to be due or owing by reason of a consumer credit transaction. To this the Court of Appeal agreed and reversed the judgment. View "Hagey v. Solar Service Experts" on Justia Law