Archive for the ‘B&P Code 17200’ Category

Self-inflicted wounds do not grant standing to sue

Tuesday, October 2nd, 2007

Purchasing a product in order to pursue litigation against the manufacturer is not sufficient to establish standing under the Unfair Competition Law (Bus & Prof Code §17200) according to a recent Court of Appeal decision.

The plaintiff, executive director of the Women’s Law Center, filed a declaration in the case stating that she purchased the skin cream both as a consumer and in order to determine the truth of the manufacturers claims.  Since she did not actually rely on any of the manufacturers claims, the court ruled that she could not pursue the claim under the Consumer Legal Remedies Act (Civ. Code §1750) or under fraud or misrepresentation theories.

Analyzing the §17200 claim, the court noted that voters had recently adopted Proposition 64 to restrict claims under that law to individuals who have suffered “injury in fact” and who have lost money as a result of the unfair competition.  As the court noted, voters expressly imported the federal standing requirement into claims under §17200.

Standing issues are often conceptually difficult in state law.  In federal court, standing relates to jurisdiction — the court’s power to hear the claim under the constitution.  Federal courts have limited jurisdiction under the Constitution to hear only “cases or controversies,” a requirement that is enforced through the standing requirement.

State courts do not operate under such a limitation, however.  In California, standing is treated as an element of the cause of action.  Like the jurisdictional standing requirement in federal courts, however, it may be raised at any stage of the proceedings.  Thus, in some instances, it seems to be a jurisdictional requirement and California courts will often look to federal authorities to determine questions of standing.  Nonetheless, the two concepts are very distinct as shown by the state’s treatment of taxpayer actions.