California Supreme Court Rules Proposition 64 Applies to Pending Cases; Leaves Open the Potential to Substitute Plaintiff to Meet Standing Requirements

2006 | Topic: Product Liability

In a decision touted as “curbing abuses of the state’s consumer protection laws,” the California Supreme Court has made it clear that Proposition 64 – the November 2004 ballot initiative that amended California’s unfair competition and false advertising laws, Bus. & Prof. Code §§ 17200 and 17500 et seq. to limit standing to sue under those statutes — applies to pending cases, not just those filed after the measure was passed.  However, the high court has left the door open for uninjured plaintiffs, whose complaints were pending when the measure took effect and who now lack standing, to substitute new plaintiffs with standing to sue under the current law.  Proposition 64 limits standing to sue under California’s statutory unfair competition and false advertising laws to private persons who have been injured in fact and no longer allows uninjured private persons to sue on behalf of the general public.

In the companion cases of Californians for Disability Rights v. Mervyn’s LLC (July 24, 2006, S131798) and Branick v. Downey Savings and Loan Assn (July 24, 2006, S132433), the high court held that uninjured plaintiffs who filed suit on behalf of the general public before Proposition 64 passed have now lost standing.  It rejected the defendant’s contention that the courts may never permit a plaintiff to amend a complaint to satisfy the Proposition 64 standing requirements, but said it could not determine whether the plaintiffs in the case before it could so amend since they had yet to file a motion for leave to amend, identified any person who might be named as a plaintiff, or described the claims that person would assert.