Class Action

Orange County District Attorney's UCL action against Toyota

By Kimberly A. Kralowec

You've probably read about the UCL public prosecutor action filed by the Orange County District Attorney's office against Toyota.  Here is a copy of the complaint (also available at the OCDA's website).  The DA is jointly represented by his own office and by the Robinson Calcagnie firm. 

The complaint is a pure UCL action seeking statutory penalties under Business & Professions Code section 17206.  It separately pleads the "unlawful," "unfair," and "fraudulent" prong claims.  The DA will not have to worry about satisfying Prop. 64's standing requirements. Nor will he have to worry about class certification. There does not appear to be any basis for removal under CAFA because the case is not (and does not need to be) pleaded as a class action. (Page 2 of the complaint also cites cases in support of an independent reason why the case should not be removable.)

In calculating the penalty amount, the trial judge will have a lot of discretion to decide what ?for each violation? means in section 17206(a). One very reasonable interpretation is that every car Toyota sold in California without disclosing the alleged safety hazards constitutes a UCL violation and triggers the $2,500 penalty.

As for where the money goes, Business & Professions Code section 17206(c) (second sentence) states: ?If the action is brought by a district attorney or county counsel, the penalty collected shall be paid to the treasurer of the county in which the judgment was entered.?  The final sentence of section 17206(c) further specifies: ?The aforementioned funds shall be for the exclusive use by the Attorney General, the district attorney, the county counsel, and the city attorney for the enforcement of consumer protection laws.? That final sentence was added by Prop. 64.

Needless to say, it will be interesting to see how this case proceeds.

Full post as published by The UCL Practitioner on March 22, 2010 (boomark / email).