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In re Tobacco II Cases

Supreme Court of California · Civil Procedure

Civil ProcedureClass ActionsUnfair Competition LawStandingUCLProposition 64section 17204section 17203

Facts

Plaintiffs alleged that tobacco industry defendants conducted a decades-long campaign of deceptive advertising and misleading statements about nicotine addiction and the relationship between smoking and disease. The trial court had certified a class of California residents who smoked cigarettes in California during a specified period and were exposed to defendants' marketing and advertising in California. After Proposition 64 amended the UCL to require that a private plaintiff suffer injury in fact and lose money or property as a result of unfair competition, defendants argued that every class member now had to prove exposure, reliance, and economic loss individually. The trial court agreed and decertified the class.

Issue

In a UCL class action after Proposition 64, must all unnamed class members satisfy the statute's standing requirements, or only the class representative? Also, what causation showing is required by the phrase "as a result of" in section 17204 when the UCL claim is based on misrepresentation?

Rule

Proposition 64 requires only the class representative, not absent class members, to satisfy UCL standing under section 17204. For a private UCL claim under the fraud prong, the representative plaintiff must plead and prove actual reliance on the allegedly deceptive conduct to show that money or property was lost "as a result of" the unfair competition; however, in a long-term fraudulent advertising campaign, the plaintiff need not identify and prove reliance on particular advertisements or statements with unrealistic specificity, and the misrepresentation need only be a substantial factor, not the sole or decisive cause.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

A group of consumers files a California UCL class action in Los Angeles against North Coast Home Air, a fictional purifier company, alleging a years-long statewide campaign falsely claiming its filters eliminate all asthma triggers. Named plaintiff Elena Cruz says she bought the filters because she believed the campaign, but discovery shows many absent class members never saw the ads and bought the filters for unrelated reasons.

Under the majority rule, what is the strongest argument against decertifying the class solely because many absent class members cannot show injury in fact and causation?

Explanation. The majority held that after Proposition 64, only the representative plaintiff must meet section 17204 standing in a private UCL class action. The statute speaks in the singular of the "person" or "claimant" pursuing representative relief, and nothing in Proposition 64 imposed standing on unnamed class members. Thus a class should not be decertified merely because absent members cannot individually show injury in fact and causation.