Unfair Competition Attorney in Santa Ana, California

At first blush, California’s Unfair Competition Law may sound like it’s aimed at preventing one business from illegally harming or poaching the business of a competitor — and it is — but it’s much more.

The UCL also provides vigorous protections for consumers who have suffered a loss of property or money due to unfair or dishonest business practices.

If you’re a consumer or business owner in or near Santa Ana, California — or anywhere throughout Los Angeles, Orange, and San Diego Counties — who has suffered because of perceived fraudulent or unfair business practices, contact me at the Martinez Law Office.

I have been practicing business litigation for four decades and will listen to your story, assess the situation, and advise and guide you on the best path forward.

What is the California
Unfair Competition Law?

California Business and Professions Code (BPC) 17200 defines unfair competition as:

• Any “unfair or fraudulent business act or practice”

• “Unfair, deceptive, untrue or misleading advertising”

• Violations of any California law starting at Section 17500 of the BPC

Bringing a UCL claim against a business or individual requires at least one of the three elements of the definition — unfair, fraudulent, or unlawful — to be alleged and proved.

“Unfair”

“Unfair” has proven to be a somewhat subjective concept, but in Cel-Tech Communications v. L.A. Cellular in 1999, the California Supreme Court attempted to solidify a definition: “When a plaintiff who claims to have suffered injury from a direct competitor’s ‘unfair’ act or practice under Section 17200, the word ‘unfair’ in that Section means conduct that threatens an incipient violation of an antitrust law, or violates the policy or spirit of one of those laws because its effects are comparable to or the same as a violation of law, or otherwise significantly threatens or harms competition.”

“Fraudulent”

The California Fourth District Court of Appeals ruled that this standard applies if members of the public are “likely” to be deceived. A UCL claim, therefore, does not have to use the common law definition of fraud that requires showing someone was actually deceived or hurt. This standard applies most certainly to claims of false or misleading advertising — deception need only be “likely.”

“Unlawful”

California courts have held that virtually any law, if broken, can be the basis for a claim under the UCL.

Examples of unfair competition include so-called “bait and switch” tactics (advertising a product at one price, but then having only higher-priced versions available when the customer comes into the store). Robocalling (or spoofing phone numbers to make robocalls) is another example if it is in violation of Federal Communications Commission (FCC) guidelines. Another example is pretending to be affiliated with or endorsed by a better-known brand.

These three represent just a tip-of-the-iceberg list of potential violations, which can cover a broad range of actions. The UCL itself mentions that distributing handbills (commercial solicitations) to hotel guests constitutes unfair competition.

Who Can Bring a Claim?

Consumers and business competitors can bring claims under the UCL. The Attorney General, district attorneys, county counsels, and city attorneys can also bring lawsuits on behalf of injured citizens.

After widespread use — and abuse — of consumers filing class-action lawsuits on behalf of others even if they had not personally been harmed, California voters passed Proposition 64 in 2004. Following Prop 64, only those who “suffered injury in fact and lost money or property as a result of such unfair competition” can file suit.

Class-action lawsuits are still possible, but they must qualify under established class-action procedures, which require a “community of interest” among the class members, along with other qualifications.

Remedies & Penalties Under the UCL

The UCL provides for fines of $2,500 in civil penalties per violation in legal actions brought by government attorneys. Here again, Prop 64 weighed in, mandating that the fines collected to be used solely for the enforcement of consumer protection laws.

As for the plaintiffs themselves, they can receive restitution in the amount of the loss they actually suffered, and no punitive damages are allowed. The court hearing the case, however, can also impose injunctive relief on the defendant “to prevent the use or employment by any person of any practice which constitutes unfair competition.” This can include the appointment of a receiver to run the business.

In many cases involving consumers, the California Consumer Legal Remedies Act also provides protection against 23 specific activities that it defines as unfair and deceptive.