Competition law: Unfair competition:
Advertising: Consumer protection: Price: Origin: Geographic origin: Labeling of
origin: Demurrer:
The complaint alleged that Newegg’s website
advertised fictitious former price and discount information that was intended
to induce customers to purchase its products (…) Hansen further asserted that
he would not have purchased the products had he known the “true nature of the
discounts.”
Newegg filed a demurrer arguing that Hansen
lacked “standing to . . . assert any claim under the FAL, UCL or CLRA” because
he had “suffered no loss of money or property as a result of Newegg’s actions.”
According to Newegg, Hansen’s complaint showed he had received the “products he
wanted for the prices he agreed to pay”; he had not alleged that “the products
were different than what he wanted, were unsatisfactory in any way, or were
worth less than what he paid for them.” Accordingly, he had suffered no form of
“economic injury.”
Summary of Applicable Law:
Unfair competition law (Bus.
& Prof. Code, § 17200) (UCL):
“The UCL’s purpose is to protect both consumers
and competitors by promoting fair competition in commercial markets for goods
and services.” (Kasky v. Nike, Inc. (2002) 27 Cal.4th 939, 949.) “In
service of that purpose, the Legislature framed the UCL’s substantive
provisions in “broad, sweeping language” and provided ‘courts with broad
equitable powers to remedy violations’.” (Kwikset, 51 Cal.4th at p.
320.)
False advertising law (Bus.
& Prof. Code, § 17500 et seq.) (FAL):
“Any violation of the false advertising law . .
. necessarily violates the UCL.” (Kasky, supra, 27 Cal.4th at p. 950.) Section
17500 “proscribes not only advertising which is false, but also advertising
which, although true, is either actually misleading or which has a capacity,
likelihood or tendency to deceive or confuse the public.” (Colgan v.
Leatherman Tool Group, Inc. (2006) 135 Cal.App.4th 663, 679.) Section 17501
specifically limits the use of advertisements that purport to convey the former
price of a product: “No price shall be advertised as a former price of any
advertised thing, unless the alleged former price was the prevailing market
price . . . within three months next immediately preceding the publication of
the advertisement or unless the date when the alleged former price did prevail
is clearly, exactly and conspicuously stated in the advertisement.” As used in
section 17501, the term “‘former price’ . . . includes but is not limited to
the following words and phrases when used in connection with advertised prices;
‘formerly –,’ ‘regularly –,’ ‘usually –,’ ‘originally –,’ ‘reduced from ___,’
‘was ___ now ___,’ ‘___% off.’” (4 Cal. Code Regs., § 1301.) (…) Our Legislature
has adopted multiple statutes that specifically prohibit the use of deceptive
former price information and misleading statements regarding the amount of a
price reduction. (See § 17501; Civ. Code, § 1770, subd. (a)(13).) These
statutes make clear that, contrary to Newegg’s assertions, our Legislature has
concluded “reasonable people can and do attach importance to a product’s former
price in their purchasing decisions.” (Kwikset, supra, 51 Cal.4th
at p. 333 [statutory prohibition on use of deceitful “Made in U.S.A.” labels
shows that reasonable consumers do rely on that form on information]; see also id.
at p. 329 [Legislature’s prohibition on deceitful Made in the U.S.A. labels
demonstrates “the materiality of this representation”].) As noted in Hinojos,
this conclusion is supported by empirical research showing that the presence of
a higher original price affects consumers’ perceptions “about the product’s
worth,” and increases their willingness to buy the product. (Hinojos,
718 F.3d at p. 1106.)
Consumers Legal Remedies Act (Civ. Code, § 1750 et
seq.) (CLRA)
The CLRA makes unlawful . . . various “unfair
methods of competition and unfair or deceptive acts or practices undertaken by
any person in a transaction intended to result or which results in the sale or
lease of goods or services to any consumer.” The CLRA sets forth 27 proscribed
acts or practices. (Civ. Code, § 1770, subd. (a)(1)-(27).) (Veera v. Banana
Republic, LLC (2016) 6 Cal.App.5th 907, 915 (Veera).) One of those
“proscribed acts” is “making false or misleading statements of fact concerning
. . . the existence of, or amounts of, price reductions.” (Civ. Code, § 1770,
subd. (a)(13).)
(Examples: are prohibited: To some consumers,
processes and places of origin matter.
In particular, to some consumers, the ‘Made in U.S.A.’ label matters. (Kwikset,
supra, 51 Cal.4th at pp. 328-329.) The Court noted that the “Legislature
had recognized the materiality of this form of representation by specifically
outlawing deceptive and fraudulent ‘Made in America’ representations.” (Id.
at p. 329 (citing § 17533.7) [prohibiting deceitful representations that a
product was “Made in the U.S.A.”] and Civ. Code, § 1770, subd. (a)(4)
[prohibiting deceptive representations of geographic origin].) (…) the
Legislature has also specifically prohibited false former price advertising, as
it did false labeling of origin. (See § 17501, Civ. Code, § 1770, subd. (a).)
(…) Kwikset, however, held that a
consumer’s decision to pay more for a product than he or she would have but for
the misrepresentation is itself a form of economic injury: In the eyes of the
law, a buyer forced to pay more than he or she would have is harmed at the
moment of purchase.
(…) The Supreme Court has concluded that to
establish standing under California’s UCL and FAL, a consumer need only allege
that he or she relied on a misrepresentation when purchasing the product, and
that he or she would not have purchased the product but for the representation.
(Kwikset, supra, 51 Cal.4th at p. 317.)
(California Court of Appeal, Second Appellate
District, July 31, 2018, Hansen v. Newegg.com Americas, Inc., Docket B271477,
Certified for Publication, Acting P.J. Zelon)
Le demandeur
soutient que le site Internet de l’entreprise défenderesse contenait des prix
avant rabais qui ne correspondaient pas à la réalité, dans l’intention
d’inciter le consommateur à l’achat. Il allègue en outre que sans cette
publicité, il n’aurait pas acheté de produits à la défenderesse.
Celle-ci soutient
pour sa part que la demande doit être rejetée d’entrée de cause, le demandeur
n’ayant pas subi de dommage économique : les allégués de la demande
démontreraient que le demandeur aurait reçu les produits qu’il voulait pour des
prix qu’il avait consenti à payer, sans prétendre avoir reçu d’autres produits,
des produits défectueux, ou de moindre valeur que la somme effectivement payée.
Cette affaire est
jugée en application du droit californien, et les dispositions topiques sont
les suivantes :
Loi contre la
concurrence déloyale (Bus. & Prof. Code, § 17200) : il est rappelé ici que
la loi utilise des formulations non restrictives, attribuant ainsi aux
Tribunaux des compétences de décision étendues.
Loi contre la publicité
mensongère (Bus. & Prof. Code, § 17500 et seq.) : toute violation de dite loi implique nécessairement
violation de la loi contre la concurrence déloyale. Dite loi proscrit non
seulement la publicité mensongère, mais aussi la publicité qui ne l’est pas
mais qui a la capacité, la possibilité, ou la tendance de tromper ou d’induire
en erreur le public. La Section 17501 de la loi limite spécifiquement la
publicité d’un ancien prix : un ancien prix ne peut pas apparaître, sauf
si cet ancien prix correspondait au prix du marché dans les trois mois
antérieurs à la publicité, ou sauf si la publicité indique clairement la date à
laquelle l’entreprise pratiquait effectivement cet ancien prix.
Le législateur a
considéré que dans sa décision d’achat, le consommateur attachait de l’importance
à l’ancien prix.
La loi
« consumers legal remedies » (Civ. Code, § 1750 et seq.) : dite loi consacre
l’illicéité de diverses méthodes déloyales ou trompeuses, soit avec l’objectif
de vendre (biens ou services), soit qui résultent effectivement en une vente
(biens ou services). La loi décrit 27 pratiques illicites. L’une de ces pratiques
consiste à déclarer de manière fausse ou trompeuse des faits relatifs à
l’existence ou au montant d’une réduction de prix. D’autres pratiques
consistent notamment à tromper quant à l’origine géographique d’un produit.
