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Goodyear Tires Wiretapping Lawsuit

Goodyear Tires Wiretapping Lawsuit to Proceed

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Goodyear Tires Wiretapping Lawsuit

In a highly anticipated ruling, a federal judge in California recently denied Goodyear’s motion to dismiss wiretapping claims based on their use of third-party chat applications hosted on their website. This ruling allows the Goodyear Tires wiretapping lawsuit to proceed. The complaint alleges that when users visit www.goodyear.com/ and use the website chat feature, they share personal data in communications that are unlawfully recorded and transcribed. The plaintiff alleged that Goodyear was allowing a third-party company to intercept, eavesdrop, and store transcripts of the conversations, which is prohibited by the California Invasion of Privacy Act (CIPA).

Do you live in California? Did you use a chat feature on a commercial website? You may be eligible to file a civil suit for invasion of privacy and get financial compensation. Contact us now.

CIPA Claim: Judge Denies Motion to Dismiss Goodyear Wiretapping Lawsuit

The California Central District Court recently issued a ruling in a case involving allegations that Goodyear Tires violated the California Invasion of Privacy Act (CIPA) by wiretapping user chats on the company’s website. The federal court agreed with the plaintiff that the chat feature violated the CIPA, ruling that the plaintiff contends that Goodyear used a third-party service to “intercept in real time” website visitors’ chat conversations. The court added that the allegation that user messages were unlawfully intercepted “is to be taken as true at this stage of the case.”

In her CIPA claim, the plaintiff alleged that visitors to the Goodyear Tires website share “sensitive personal information” when they use the chat conversation. Significantly, the court ruled that the plaintiff pled sufficient facts for a claim under § 631(a) of the CIPA by showing that chat communications were intercepted, and those communications plausibly contained “more than mere record information” such as her name and address.

Wiretapping of Smartphone Communications

The California Central District Court also addressed the fact that the plaintiff accessed the Goodyear Tires website on her smartphone, which is considered a cellular phone with web capabilities. The federal court noted the precedent set by other courts that have applied § 632.7 of the CIPA to internet-based communications, ruling that the plaintiff has sufficiently alleged that users of Goodyear’s chat feature have a reasonable expectation of privacy because they share highly sensitive personal data.

California Has the Strongest Data Privacy Laws in the Country

California’s consumer protection laws include the California Invasion of Privacy Act (CIPA) and the California Consumer Privacy Act (CCPA). The CIPA requires companies to get permission before recording any online chats, while the CCPA gives customers the right to prevent companies from sharing their personal data. California’s data privacy laws go even further by placing the onus on companies to make efforts to warn customers if their phone conversations or online chats are being monitored or recorded. In fact, California has some of the strongest such laws in the country. This may be why Goodyear’s terms of use include a forum selection clause requiring claims to be filed in another state: Ohio.

Goodyear Website Terms of Use

The Goodyear Tires website has a “Terms of Use and Privacy Policy” hyperlink at the bottom of the homepage. Site visitors can only see this link by scrolling all the way down on the website. When a user clicks on this link, they are directed to a “Terms, Conditions & Privacy Policy” page that includes another link for Terms of Use. There is no option for the user to click a button acknowledging that they have read the terms of use. Buried deep on this page is a section on “Applicable Laws,” which includes a forum selection clause stating that anyone who uses the Goodyear website automatically consents to litigating any legal disputes in an Ohio courtroom.

Goodyear Forum Selection Clause

In a recent lawsuit filed in California by Los Angeles false advertising attorney Robert Tauler against Goodyear, the tire company attempted to get the case moved to a jurisdiction with less stringent consumer protection laws. Goodyear specifically requested that the venue be changed from the U.S. District Court for the Central District of California to the District Court for the Northern District of Ohio.

Goodyear Tires argued that the plaintiff already agreed to having any legal proceedings handled in Ohio because she used the Goodyear website and automatically consented to the forum selection clause contained in the website’s “Terms of Use.” Robert Tauler responded on behalf of the plaintiff and persuasively argued that it was not possible for the plaintiff to legally consent to the forum selection clause because there was neither actual nor constructive notice of the “Terms of Use.”

The California federal trial court hearing the case ultimately rejected Goodyear’s motion to change venue, which means that the case will be adjudicated in the California Central District Court and decided under California’s very strong invasion of privacy and consumer protection laws. The court gave several reasons for ruling in favor of the consumer-plaintiff and against Goodyear, including contract formation laws which require mutual assent in order for a contract to be binding on both parties.

Are Internet Contracts Legally Enforceable?

The Ninth Circuit Court of Appeals previously identified two categories of internet contracts like the Goodyear terms of use:

  1. Clickwrap Agreements: Site visitors must check a box to confirm that they agree with the website’s terms and conditions of use.
  2. Browsewrap Agreements: Site visitors are able to click on a hyperlink that will take them to a page with the website’s terms and conditions of use.

An important aspect of browsewrap agreements is that it is possible for a site visitor to continue using a website without knowing that the agreement even exists. That’s because browsewrap agreements like the one on the Goodyear Tires website do not require site visitors to take any affirmative action. This creates a legal issue for internet contracts that rely on browsewrap agreements since users might not have an opportunity to assent to the terms of use. Courts have held that such a contract can only be valid if the website user had either actual or constructive notice of the terms and conditions.

Goodyear Browsewrap Agreement

The Goodyear browsewrap agreement does not qualify as a valid, legally binding internet contract because the website terms of use are inconspicuous: the hyperlink can only be seen when the user scrolls to the bottom of the page, and the text does not stand out against the background colors. This does not provide the user with sufficient notice. In Wilson v. Huuuge, Inc., the Ninth Circuit Court of Appeals held that courts should not enforce a similar smartphone app agreement “where the terms are buried at the bottom of the page or tucked away in obscure corners of the website.”

Additionally, there is nothing on the Goodyear Tires website that requires the consumer to click a button, check a box, or take any other action that would unambiguously convey their assent to the terms of use. This also means that site visitors are not provided with constructive notice of the website terms of use which they are supposedly agreeing to abide by.

Class Action Lawsuit Against Goodyear Tires for Violating California’s Wiretapping Law

When you visit a website, you have an expectation that your personal data will be protected and that any conversations you have on the website will remain confidential. The Los Angeles consumer protection attorneys at Tauler Smith LLP help clients file CIPA claims both individually and in class action lawsuits against companies that violate California’s data privacy laws. For example, our attorneys have represented individuals whose data was compromised due to illegal wiretapping and eavesdropping, including chat conversations on company websites.

The CIPA is a criminal statute that subjects companies to criminal penalties, including jail time and substantial fines. Victims can also bring civil lawsuits to recover statutory damages of $5,000 for each illegally recorded conversation. In some cases, it may be possible to recover treble damages, meaning that plaintiffs are eligible for up to three (3) times the total economic damages caused by the invasion of privacy.

Contact the California Consumer Protection Attorneys at Tauler Smith LLP Today

Did you use the chat feature on the Goodyear Tires website? Did you use a chat feature on any other commercial website? If so, your personal data may have been unlawfully recorded without your consent and in violation of both state and federal wiretapping laws. The California consumer protection lawyers at Tauler Smith LLP can help you. Call 310-590-3927 or send an email to learn more and find out if you are eligible to file a CIPA claim.

Shipping Insurance Claims & UCL

Shipping Insurance Claims and the UCL

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Shipping Insurance Claims & UCL

Many companies that offer shipping insurance on e-commerce sites are violating California insurance laws, which have strict requirements about who is allowed to offer insurance and how that insurance can be offered. Moreover, California’s insurance laws can serve as a predicate for civil lawsuits brought under other statutes, including the California Unfair Competition Law (UCL). When it comes to shipping insurance claims and the UCL, there is strong legal precedent in favor of consumers who are charged for insurance by an unlicensed agent. Additionally, the shipping insurance offered by online sellers is often just a surcharge on services already being provided, which is business fraud that can also be the basis for a civil suit.

To learn more about how California consumer protection laws can be used to file a shipping insurance lawsuit against e-commerce sellers, keep reading.

Filing a Shipping Insurance Lawsuit Under California’s Unfair Competition Law (UCL)

Some companies that offer shipping insurance on their e-commerce websites expressly label it as “insurance,” while other companies call it “safe ship” or use another term. In fact, it is common for online sellers to refer to an insurance fee by some other name. For example, the plaintiff in Miller v. Travel Guard Group alleged that the company mislabeled the travel insurance fee on their website in order to get around the state prohibition against unlicensed agents selling insurance. Regardless of what term is used, however, both the California Insurance Code and the Unfair Competition Law (UCL) protect consumers against unlawful offers of insurance.

Section 1631 of the California Insurance Code imposes licensing requirements on any entity that seeks to sell insurance in the state. If a company violates the California Insurance Code by attempting to sell insurance as an unlicensed agent, consumers may be able to bring a UCL claim. Additionally, companies that hide a shipping insurance charge on a purchase could be exposed to lawsuits under the UCL for false, misleading, deceptive, and unlawful marketing and sales practices.

Section 17200 of the UCL

The California Unfair Competition Law (UCL) is set forth in Cal. Bus. & Prof. Code § 17200. The statute defines “unfair competition” as:

  1. Any unlawful, unfair, or fraudulent business act or practice.
  2. Unfair, deceptive, untrue, or misleading advertising.

The UCL is a sweeping law that is meant to protect both consumers and businesses. In fact, the statute has been interpreted broadly by California courts to cover a wide variety of business acts and consumer transactions, including antitrust violations, intellectual property claims, employment claims, and disputes over shipping insurance charges.

Both federal and California courts have held that companies may be sued for breach of contract and unfair competition when they violate state insurance laws. In fact, the U.S. Court of Appeals for the Ninth Circuit said that the California Insurance Code can serve as a predicate for a claim brought under the California Unfair Competition Law (UCL) even though the UCL does not explicitly provide for a private right of action for shipping insurance claims. In Miller v. Travel Guard Group, the California Northern District Court went even further by ruling that consumers may bring a claim under the UCL based on both an illegal agent theory and an illegal premium theory when the insurance fee is automatically included in the total price and the customer is not given an opportunity to opt out of paying it.

Only Licensed Agents Can Sell Insurance in California

California has strict laws regulating exactly who can sell insurance. Whether it’s auto insurance, property insurance, health insurance, general liability insurance, or shipping insurance, only licensed agents are allowed to offer insurance to customers. One way that California law protects consumers against insurance fraud is by requiring many types of insurance agents (e.g., home and auto insurance) to file bonds with the state insurance commission.

In order to charge customers for shipping insurance, a company must comply with California’s insurance laws. This means that insurance agents need to be registered with the state. Beyond that, owners, insurance agents, and even non-licensed employees must provide fingerprints that are kept on file with the state. All of this is in addition to standard business certification requirements, such as securing a certificate of good standing if the company is a corporation and a certificate of organization if the company is an LLC.

Friedman v. AARP Established Precedent for Shipping Insurance Claims in California

In Friedman v. AARP, Inc., the Ninth Circuit Court issued an important ruling that set precedent for subsequent cases involving offers of insurance to California consumers. The plaintiff in Friedman was a Medicare recipient who purchased UnitedHealth supplemental health insurance coverage through the AARP (previously known as the American Association of Retired Persons). Since AARP earned a 5% commission on the sale, they were essentially acting as an insurance seller without a license. This would be in direct violation of California Insurance Code § 1631. That statute prohibits anyone from soliciting, negotiating, or effecting an insurance contract unless the person holds a valid license from the California Commissioner of Insurance. California Insurance Code § 1633 goes even further by explicitly prohibiting an unlicensed company from “transacting” insurance regardless of whether the company reports itself as an insurance agent.

Facts of the Case

The plaintiff in the case was Jerald Friedman. He was one of several AARP members who filed a class action against AARP because the organization allegedly charged inflated insurance rates for Medigap coverage. (Medigap policies provide supplemental health insurance for costs that are not already covered by Medicare.) These exaggerated charges allegedly stemmed from a hidden commission that AARP was collecting.

The lower court in Friedman dismissed a class action brought by the plaintiff under the UCL. The Ninth Circuit then reversed that decision because the federal appellate court determined that AARP’s fee arrangement qualified as a commission on every insurance sale. In other words, AARP was acting as an insurance agent by selling insurance.

UCL Violation

Section 17200 of the California Unfair Competition Law (UCL) explicitly prohibits companies from engaging in “any unlawful, unfair, or fraudulent business act or practice.” AARP was accused of violating the UCL by committing the unlawful act of selling insurance without a license.

Since AARP is not licensed to sell insurance in California, it is unlawful for the group to offer insurance to its California members. AARP marketed the Medigap policy to its members in a number of ways, including television ads, websites, and materials sent directly through the mail. A lot of these advertisements included text reading, “This is a solicitation of insurance.” Although AARP later tried to describe its insurance commission as a “royalty,” the federal government determined that it was still a commission being charged on top of the typical monthly premium. This meant that AARP was essentially acting as an insurance agent despite not having a license to do so in California.

Unlawful to Conceal a Shipping Insurance Charge in California

Under California law, there is an expectation that consumers will be able to provide informed consent for purchases they make online. Unfortunately, some businesses trick customers into paying more for shipping insurance with hidden or confusing features on their e-commerce websites, particularly when it comes to placing and finalizing orders. The businesses generate additional revenues by offering a service that they are not legally allowed to offer without a valid, state-issued license.

Companies that do business in California and use deceptive marketing and sales tactics could be subject to civil suits for violating the UCL. That’s because the statute prohibits false, misleading, deceptive, and fraudulent acts or practices, which may include attempts by the business to deceive customers about hidden shipping insurance fees. An experienced Los Angeles insurance claim lawyer can help consumers bring a lawsuit against companies that violate the UCL by making an unlawful offer of shipping insurance.

UCL Claims

When consumers unknowingly purchase shipping insurance on a website due to misleading and/or deceptive information, they suffer an injury. The Unfair Competition Law can be used as the basis for a shipping insurance lawsuit if the defendant violated the “fraudulent” prong of the statute by misleading customers about the additional charge. In these cases, the plaintiff will need to establish two elements to bring a successful claim: (1) that the company deceived the public in some way either in an advertisement or during the checkout process; and (2) that the consumer relied upon the company’s statements or advertisement.

There are several ways that a company could violate the UCL by attempting to charge customers for shipping insurance:

  • Confusing Language: The company might use ambiguous and confusing language to describe the insurance charge, which means that consumers won’t necessarily understand what it is that they are purchasing.
  • Hiding the Insurance Charge: It’s also possible that the company might hide the total purchase price from the consumer by failing to clearly inform them of the total cost when shipping insurance is included, or by failing to allow the consumer to edit their order once a shipping insurance charge has been added.
  • Lack of Consent: In the most egregious cases, the company might not even give the consumer an opportunity to consent to the shipping insurance charge. There have been cases in which a company automatically charges for shipping insurance unless the purchaser clicks on a random and inconspicuous “decline” button before completing the order.

When a company fails to disclose information that consumers need in order to make informed decisions about a purchase, it could be a violation of the UCL. Whether it’s a misleading advertisement or a concealed charge on a company’s website order form, California consumers may be able to bring a shipping insurance claim under the UCL.

CLRA Claims

This type of conduct by a business might also violate the California Consumers Legal Remedies Act (CLRA), which prohibits certain unlawful acts involving consumers. For example, the CLRA explicitly forbids companies from “advertising goods or services with intent not to sell them as advertised.”

The ordering and check-out processes on some e-commerce websites are confusing and possibly even deceptive. As a result, it’s very possible that consumers are unknowingly purchasing shipping insurance as an upcharge or add-on because websites don’t make the additional charge immediately apparent to site visitors. Moreover, it’s possible that some consumers would not have purchased the product at all if they had known about the shipping insurance charge. Worse yet, many consumers might not become aware of the additional charges until much later when their bank account or credit card is debited for the order.

Contact the Los Angeles False Advertising Lawyers at Tauler Smith LLP

Were you charged for shipping insurance while making a purchase on an e-commerce website? The Los Angeles false advertising lawyers at Tauler Smith LLP represent clients in civil lawsuits and class action lawsuits against companies that commit business fraud, including litigation involving shipping insurance claims against companies that illegally offer shipping insurance in online transactions. Call 310-590-3927 or email us to schedule a free initial consultation.

California Unfair Competition Law

California’s Unfair Competition Law (UCL)

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California Unfair Competition Law

California’s Unfair Competition Law (UCL) is one of the most important consumer protection laws in the country. California courts tend to interpret the UCL broadly so that it applies to a wide range of unethical business practices. The statute explicitly prohibits companies from engaging in unlawful, unfair, or fraudulent business actions. It also prohibits companies from using false advertising. Businesses that violate the UCL may be subject to penalties that include financial compensation, monetary fines, and injunctions to stop committing certain acts. This means that consumers who purchase a product or service from a business that violates the UCL may be able to have an experienced California consumer fraud lawyer file a lawsuit and seek financial restitution.

To learn more about the California Unfair Competition Law, keep reading this blog.

What Is the California Unfair Competition Law?

The California Unfair Competition Law (UCL) is codified in Bus. & Prof. Code section 17200. The UCL protects consumers against business fraud, false advertising, and other deceptive practices by placing limits on companies doing business in California. The statute also protects honest companies and ensures that competition remains fair and strong, with no one company allowed to stifle competition and gain a competitive advantage by breaking the law.

Importantly, the UCL applies to all private companies doing business in California. This means that if a company is based in another state, if they sell to consumers located in the state, or even if they advertise in the state, they can be sued under the UCL.

What Is “Unfair Competition”?

The California Unfair Competition Law defines “unfair competition” as any of the following:

  1. An unlawful business act or practice.
  2. An unfair business act or practice.
  3. A fraudulent business act or practice.
  4. Unfair, deceptive, untrue, or misleading advertising.
  5. Any other act prohibited by the UCL.

Courts have interpreted the UCL broadly so that just about any violation of the law by a business can also constitute a violation, so long as the action or practice injured consumers or gave the business an advantage over its competitors. One of the most common examples of unfair competition in consumer transactions is when a company makes misrepresentations to customers about the type, quality, or cost of a product or service.

Deceptive Advertising

Examples of deceptive advertising that may violate the UCL include robocalling customers, using bait and switch advertising to trick customers, using fake endorsements in ads, exaggerating product descriptions, omitting important information about a product or service in an advertisement, manipulating prices, using false reference pricing in ads, and infringing on another company’s intellectual property.

Unlawful, Unfair, and Fraudulent Business Acts

The UCL defines “unlawful” business acts or practices as any action taken by a company that violates state or federal law. Even if the company committed the unlawful act just once, that can be enough to trigger legal action under the UCL.

An “unfair” business act or practice, as defined by the UCL, is typically committed by either a company or a business competitor. Generally speaking, a company violates the UCL when they attempt to sell goods or services that harm consumers. In the context of a business competitor, it is considered an unfair business act when the company does something that broadly undermines competition in the marketplace.

The UCL also prohibits “fraudulent” business acts or practices, which means any conduct that misleads or deceives consumers. When a consumer relies on false statements made by the company in an advertisement or at the point of sale and subsequently suffers an economic injury, they may be able to bring a UCL claim for restitution.

Private Right of Action Under Section 17200 of the UCL

The California Unfair Competition Law (UCL) allows both private parties and public prosecutors to take legal action against companies that commit fraudulent business acts. In most cases, an individual who has suffered an injury because of unfair competition must have their lawsuit filed by a county or city prosecutor. When the lawsuit is filed as a class action, however, a consumer may bring the action as a private plaintiff.

Standing to sue under the UCL can be established by showing that the plaintiff sustained an economic injury because of the business’ conduct. If the plaintiff bought an item from the business, then this would be enough to meet the UCL standing requirement.

False advertising claims brought under the UCL must establish that the plaintiff sustained economic injury because the defendant company engaged in misleading advertising of goods or services. Basically, this means that the consumer needs to show that they purchased an item or service and that they did so because of a deceptive advertisement.

Strict Liability

Section 17200 of the Unfair Competition Law imposes strict liability on businesses that commit fraud, which means that it does not matter whether they intended to commit fraud. The mere fact that their actions were unlawful, unfair, or fraudulent is enough to violate the statute. Additionally, it is not a defense against a UCL claim that the company’s ad was true or accurate. That’s because the plaintiff in a UCL case merely needs to show that the ad was likely to mislead consumers.

Moreover, it is important for businesses to understand that they can be sued under the UCL even if their actions are not technically unlawful. That’s because the statute explicitly prohibits “unfair” business acts and practices.

Restitution and Damages Available in UCL Claims

There are two remedies available to plaintiffs in an Unfair Competition Law claim:

  1. Actual economic damages, which means the defendant company is ordered to pay back any money received from the consumer.
  2. An injunction ordering the defendant to stop committing the fraud.

There are no punitive damages allowed in UCL cases. This is one reason that individual consumers often join forces to file a UCL claim as a class action, which can make it harder for the defendant to avoid paying a large damages award. A knowledgeable California UCL attorney can help the plaintiffs determine if it would be better to bring a class action lawsuit.

What Is the Statute of Limitations for UCL Claims?

The statute of limitations for a UCL claim is four (4) years, with the clock starting as soon as the business commits the fraudulent act or as soon as the plaintiff discovers the fraud. The standard used in these cases is a reasonable person standard, which means that the court will ask whether a person who exercised reasonable diligence would have discovered the unlawful business act when the statute of limitations period started to run.

Related Laws: CLRA, ARL, and FTC Act

There are a few other related statutes that California consumers should be aware of when deciding whether to file a UCL claim.

CLRA Claims

Unfair Competition Law claims are often accompanied by claims under the California Consumers Legal Remedies Act (CLRA). The CLRA is more limited than the UCL because the CLRA includes protections for specific actions by businesses, whereas the UCL applies broadly to business fraud. It may be in the best interests of a plaintiff to bring a claim under both statutes because the remedies are cumulative. Beyond that, only the CLRA allows for punitive damages to be imposed against the defendant. Additionally, the CLRA allows plaintiffs to recover attorney’s fees.

ARL Claims

It is also possible for California consumers to use the Unfair Competition Law to bring a private civil action against companies that violate California’s automatic renewal laws. This is significant because the California ARL does not allow for a private right of action, which means that consumers who are deceived into signing up for an auto-renewal subscription may still be able to sue for full restitution under the UCL.

Federal Laws

There are also federal laws, such as the Federal Trade Commission Act (FTC Act), that protect California consumers against business fraud and false advertising. One advantage for plaintiffs filing a UCL claim is that the state statute has broad consumer protections that go beyond the protections provided under federal law.

Keep in mind that defendants may argue that more lenient federal law should apply in a particular case instead of the stringent California state law. That’s why it is important to have a skilled Los Angeles false advertising attorney on your side throughout the case.

Contact the California Consumer Protection Attorneys at Tauler Smith LLP

Tauler Smith LLP is a Los Angeles law firm that represents consumers in civil litigation, including class actions based on UCL violations. Our Los Angeles consumer protection lawyers understand the nuances of the California Unfair Competition Law, and we can help you get financial restitution from a company that used fraudulent business practices. Call us today at 310-590-3927 or email us to discuss your case.

California Comparison Pricing

Comparison Pricing Litigation in California

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California Comparison Pricing

It has become increasingly common for consumers to bring comparison pricing litigation in California. That’s because the state has some of the strongest consumer protection laws in the country, including laws that regulate unfair competition, false advertising, and deceptive pricing. California’s comparison price law requires retailers to provide accurate pricing information in advertisements, whether the ads appear in print media or online. The law recognizes that consumers should not be tricked into purchasing an item for the regular full price simply because the retailer included a fake sale price in an advertisement or promotion. If this has happened to you, one of the California false advertising lawyers at Tauler Smith LLP can help you.

To learn more about comparison pricing litigation in California, keep reading this blog.

Comparison Pricing Is a Retail Sales Strategy That May Violate California False Advertising Laws

Retailers that do business in California and elsewhere often use comparison pricing, reference pricing, strikethrough pricing, or compare-at pricing to persuade customers to make a purchase. All of these basically mean the same thing: the retail company prominently advertises that the item is “on sale,” and they back up this claim with a visual comparison between the current sale price and the original list price.

Comparison pricing is subject to strict regulations because lawmakers recognize that a lot of retailers go too far with deceptive ads that aren’t entirely honest about the former prices. For example, the reference price mentioned in the advertisement or promotion might be from a very long time ago, or it might be for an item that is not the same as the one currently being sold. Since the California comparison pricing law requires businesses to use actual sales prices that are relevant and timely, these types of former pricing representations with deceptive discounts could expose a retailer to consumer litigation.

California Has Strong Consumer Protection Laws

Under both federal and state consumer protection laws, retailers that do business in California cannot use fictitious price comparisons when advertising products. Consumers should also keep in mind that the comparison pricing laws apply to both in-person sales and online sales.

The jurisdiction where a comparison pricing lawsuit is filed can make all the difference when it comes to the outcome of a case. That’s because certain states have very strong consumer protection laws that hold businesses to extremely high standards for advertising, marketing, and sales practices. California has some of the strongest consumer fraud statutes, including §17501 of California’s Business & Professions Code that directly addresses fraudulent marketing and advertising practices.

Comparison Pricing Lawsuits Filed Against Retail Companies in Los Angeles

Failure to comply with California’s law on comparison pricing could expose retailers to significant liability, including a class action lawsuit filed by consumers who purchased products after viewing the misleading advertisement with deceptive sale pricing. Just some of the major retailers that have been sued under California’s false advertising law in recent years include Amazon, The Gap, Guess, J.Crew, Kate Spade & Company, Neiman Marcus Group, Overstock.com, and Walmart.

In California, the Los Angeles City Attorney’s Office has made a point of going after large retailers that use deceptive pricing in ads to generate sales. The crackdown on false reference pricing prompted the LA City Attorney to bring civil suits against several major department stores that did business in the city, including JCPenney, Kohl’s, Macy’s, and Sears. The retailers were accused of deceptively marketing thousands of items at “sale” prices that did not exist.

California’s False Advertising Law Prohibits Deceptive Prices in Retail Ads

Section 17501 of California’s false advertising law explicitly prohibits advertisements that use a misleading or inaccurate former price.

Actual Prices

The California law stipulates that there must be a legitimate basis for the comparison price cited by the retailer, whether it’s a list price or Manufacturer Suggested Retail Price (MSRP). Businesses are not allowed to create false impressions about discounts by referencing prices that never actually existed just to make the ticket price look like a good deal. The retailer must be prepared to provide proof that the item was previously sold for a higher price. But even that might not be enough for the retailer to avoid retail discount pricing litigation. For example, if the former price was only in effect for a short period of time, the retailer might not be legally allowed to mention this price in an advertisement because there will be serious questions about whether the original compare-at price was legitimate.

Three-Month Time Period

The California law places limits on the comparison prices that retail businesses may mention in an advertisement by explicitly barring them from mentioning an item’s former price unless it was the “prevailing market price” within the three months immediately preceding the ad’s publication.

But what happens when the company’s sale lasts longer than 90 days? In situations like this, California’s promotional pricing guidelines call for the company to revise its advertisement or run the risk of violating the strikethrough pricing statute. That’s because the former price listed in the ad will no longer fall within the 90-day window, which means that it’s no longer valid under the law. In other words, a sales ad that was initially legal will become illegal and could serve as the basis for a consumer to file a lawsuit.

Importantly, California does give retailers an opportunity to revise their ads so that they avoid violating the law. The company can either change the former price in the ad once it becomes outdated or they can “clearly, exactly, and conspicuously” note the date when the former price applied so that the advertisement is not misleading.

Define Relevant Terms

In addition to establishing a three-month timeframe for evaluating the appropriateness of the former price being advertised, the California false advertising statute also attempts to define relevant terms for retailers and consumers. For instance, what does the law mean by “prevailing market price”? This matters because the actual price of the item in question will go a long way toward determining whether the former price was legitimate or false.

Here, there are several factors that must be considered. For instance, what was the actual price of the item at other stores in the same geographical area or region? Also, were any sales made at that price? And, if so, how many units sold? Moreover, were there different prices for the item during the three-month period being evaluated? Since a court can consider any or all of these factors in a strikethrough pricing case, it is important for consumers to speak with a qualified California consumer protection attorney before making any final decisions about how to proceed with their case.

Standing to Sue in California Strikethrough Pricing Claims

It is often easier for plaintiffs to establish that they have standing to sue in a comparison pricing claim brought under California’s false advertising law. Of course, the plaintiffs in a California comparison pricing case must establish that they have standing to sue. In the past, this meant that the plaintiff needed to show that they purchased the item and that they did so at a price higher than they otherwise would have paid. Absent this showing, the door was open for defendants to argue that the plaintiff did not suffer any injury or economic harm because they received exactly what they paid for and therefore got “the benefit of the bargain.”

Things became much easier for plaintiffs when the California Supreme Court ruled in Kwikset Corp. v. Superior Court that plaintiffs in false advertising cases no longer need to prove that the product they purchased was worth less than the amount paid for it. Now, plaintiffs who bring a comparison pricing claim in California courts merely need to show that they purchased the item because of the deceptive pricing information in the ad; the prevailing market price or MSRP of the item no longer matter.

False Reference Pricing Class Action Lawsuits in California

California false advertising laws regulate companies that do business in the state, including broad protections against sales price misrepresentations. This has led to numerous class action lawsuits being filed on behalf of consumers who have fallen victim to false reference pricing.

It is important for consumers to recognize that they can file a civil suit, or join a consumer class action, even when the retail company does not have a physical brick-and-mortar location in California. As long as the consumer is in California and accessed the business’ website to view the ad or to make a purchase, they may be eligible to bring a Section 17501 claim for false reference pricing.

How Much Money Can Consumers Recover in a California Comparison Pricing Claim?

When a retailer is sued for violating California’s false advertising law, the monetary damages may be substantial. That’s because the statute allows for recovery of actual damages by the plaintiff, as well as the imposition of civil penalties against the defendant. These civil penalties can quickly add up because the defendant can be ordered to pay $2,500 for each violation of the law. Moreover, the court may have the option to impose an additional fine of $2,500 for each violation that injured a senior citizen or a disabled person.

Other California False Advertising Statutes: CCPA, and CLRA, and UCL

One strategy that retail companies might use to get around the California false advertising law is to hide their sales in customer loyalty programs. But this tactic may be a violation of the California Consumer Privacy Act (CCPA), which gives consumers another avenue for filing suit against retailers.

Additional legal claims that may be available in comparison pricing cases include violations of the Consumers Legal Remedies Act (CLRA), especially if the defendant’s conduct involved deceptive language in the advertisement.

The California Unfair Competition Law (UCL) is another consumer protection statute that applies broadly to a wide range of conduct by companies, including unlawful, unfair, and fraudulent business practices. Deceptive or false advertising is also prohibited by the statute.

Contact the California False Advertising Lawyers at Tauler Smith LLP

A lot of retailers use comparison prices in advertisements to encourage consumers to make a purchase while the item is “on sale.” If you bought a retail product because the retailer used deceptive pricing in a store ad or an online ad, you should speak with an experienced Los Angeles consumer protection attorney at Tauler Smith LLP.

Call 310-590-3927 or email us to schedule a free initial consultation.

California Invasion of Privacy Act

California Invasion of Privacy Act (CIPA)

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California Invasion of Privacy Act

It is quite common these days for businesses to monitor and record phone calls with customers, whether it’s to ensure that orders are accurate, to review employee interactions, or for some other reason. At the same time, new technologies have made it easier than ever to eavesdrop on private communications. Unfortunately, this has resulted in some companies going too far by invading the privacy of customers. The California Invasion of Privacy Act (CIPA) is a state law that makes it illegal for businesses to wiretap consumer communications and record you without your consent. Businesses that violate the CIPA may be subject to both criminal and civil penalties, including a lawsuit filed by any consumers whose conversations were wiretapped or recorded without permission.

To learn more about the California Invasion of Privacy Act, keep reading this blog.

What Is California’s Invasion of Privacy Law?

California has the nation’s strongest consumer protection laws, including the California Invasion of Privacy Act (CIPA), the California Consumer Privacy Act (CCPA), the California Consumers Legal Remedies Act, and the California Unfair Competition Law (UCL). The CCPA was enacted in 2018 to become the nation’s first state privacy law, and it strengthened protections for customer data collected by businesses online. The CIPA has a longer history, having been passed by the California State Legislature in 1967 for the purpose of more broadly protecting the privacy rights of all state residents, including consumers. Under the CIPA, it is illegal for companies to wiretap or record conversations unless all participants have consented to the recording. This applies to telephone conversations and online communications.

Cell Phones

Although the wiretapping law was initially intended to cover calls on landline phones, the use of cellular phones has been addressed by the statute. Cal. Pen. Code sections 632.5 and 632.6 specifically prohibit the use of a recording device when a call involves a cellular phone, whether it’s two cell phones or one cell phone and one landline phone.

Websites & Session Replay Software

In addition to recording phone conversations, a lot of companies also keep records of their interactions and communications with customers who visit a company website. This becomes problematic – and possibly illegal – when the company uses session replay software to capture visitor interactions with their website. That’s because the use of this type of tracking software may constitute an unlawful intercept of the communication, as defined by California’s wiretap law.

Session replay software allows website operators to monitor how a user interacts with the website. The tool then reproduces a video recording that shows the user’s interactions, including what they typed, where they scrolled, whether they highlighted text, and how long they stayed on certain pages. When companies employ this software, the very fact that a machine is being used to intercept customer communications constitutes a violation of the CIPA.

California Penal Code Section 631: Wiretapping

California Penal Code Section 631 forbids anyone from illegally wiretapping a conversation. The law specifically prohibits the following:

  • Using a machine to connect to a phone line.
  • Trying to read a phone message without the consent of all the parties participating in the conversation.
  • Using any information obtained through a wiretapped conversation.
  • Conspiring with another person to commit a wiretapping offense.

Some states allow a call to be recorded when just one participant is aware of the wiretap and consents to it, even if the person recording the call is the one providing consent. But California is a two-party consent state, which means that everyone involved in the call or chat must agree to it being recorded. If just one party does not provide consent, then recording the conversation constitutes a violation of the CIPA and can result in both criminal and civil penalties.

Out-of-State Businesses

Even if the person who called you or chatted with you was not located in California, you can still bring a lawsuit under the Invasion of Privacy Act as long as you were in the state at the time of the call or chat. That’s because out-of-state businesses must still comply with California laws when communicating with someone who is in the state.

California Penal Code Section 632: Eavesdropping

Section 632 of the California Penal Code addresses the crime of eavesdropping. Many times, a wiretapping case also involves eavesdropping offenses where the offending party both taps a phone line and listens in on the conversation. The main difference between the two is that eavesdropping does not necessarily involve the tapping of a phone line.

The statute defines “eavesdropping” as the use of a hidden electronic device to listen to a confidential communication. Significantly, the law is not limited to phone conversations. When someone intentionally eavesdrops on an in-person conversation, they may be subject to criminal charges and a civil suit for damages. The types of electronic devices that are often used to illegally eavesdrop include telephones, video cameras, surveillance cameras, microphones, and computers. If the device was concealed from one of the parties, it may constitute a violation of California’s eavesdropping laws.

Can You Sue for Invasion of Privacy in California?

Although the California Invasion of Privacy Act is technically a criminal statute, Cal. Pen. Code §637.2 gives victims of wiretapping and eavesdropping the ability to bring a civil suit against the person or company that illegally recorded the conversation. If you learn that someone was listening in on your private conversation without permission, you may be able to file a lawsuit to recover statutory damages.

How to Prove Invasion of Privacy Under the CIPA

To win your CIPA claim, you will need to prove that the conversation was illegally recorded in the first place. In some cases, this will be obvious because the business will reveal that they are monitoring and recording the call or chat. In other cases, consumers may learn about illegal wiretapping during the discovery process when the defendant is forced to turn over company records.

The other elements of a CIPA claim that you will need to establish at trial include:

  • The defendant intentionally used an electronic device to listen in on and/or record the conversation.
  • You had an expectation that the conversation would not be recorded.
  • You or at least one other person on the call did not consent to having the conversation recorded.
  • You suffered some kind of harm or injury as a result of your privacy rights being violated by the defendant.

The use of a cellular phone can change the burden of proof needed to win a CIPA claim. That’s because courts will typically use a strict liability standard when at least one of the participants on the call was using a cell phone. This means that the context and circumstances of the call won’t matter; the court will automatically presume that there was an expectation of privacy. Additionally, strict liability will apply to the defendant even when they did not realize that the other person on the call was using a cell phone.

What Is the Penalty for Invasion of Privacy?

The criminal penalties for violating the California Invasion of Privacy Act (CIPA) include possible jail time and significant fines. Businesses that violate the CIPA may also be exposed to civil penalties when a consumer files a lawsuit in state court.

Criminal Penalties

The CIPA gives criminal prosecutors wide latitude to charge an offense as either a misdemeanor or a felony, depending on the facts of the case. If a CIPA violation is charged as a misdemeanor, the defendant could be sentenced to one year in jail and ordered to pay up to $2,500 in statutory fines for each violation. If the violation is charged as a felony, the possible jail time could increase to three years. Additionally, anyone convicted of a second wiretapping offense could face more substantial fines.

Civil Penalties

The CIPA lists statutory penalties that may be imposed against companies or individuals who violate the statute. The court can order the defendant to pay $5,000 in statutory damages for each illegally recorded conversation, or three (3) times the actual economic damages you suffered because of the privacy breach. The judge in your case will have the option to choose whichever amount is greater: the statutory damages or the actual damages.

Depending on the circumstances of your case, you might also be able to file a right of publicity lawsuit. That’s because right of publicity claims and invasion of privacy claims often overlap, especially when a business attempts to profit from someone else’s image or likeness without consent.

California Invasion of Privacy Statute of Limitations

It is very important that you take immediate action and speak with a qualified consumer protection attorney as soon as you suspect that a company may have violated your privacy during a communication. That’s because the California Invasion of Privacy Act (CIPA) requires plaintiffs to file a civil suit within one (1) year of the date on which the conversation happened. Failure to bring your case before one year has passed could result in your lawsuit being dismissed.

The statute of limitations period typically begins when the plaintiff knew about the defendant’s illegal wiretapping. But what happens when the plaintiff did not learn about the invasion of privacy violation until later? In these cases, the court usually applies a reasonable person standard, which means that the court will attempt to determine the point at which a reasonable person standing in the shoes of the plaintiff would have known about the unlawful act by the defendant. In other words, should the plaintiff have discovered the privacy violation before the statute of limitations expired?

Contact the Los Angeles Consumer Protection Lawyers at Tauler Smith LLP

If a company invaded your privacy by secretly recording a conversation without your permission, you may be eligible to file a civil suit to recover statutory damages. The first step you should take is to speak with an experienced Los Angeles consumer protection attorney at Tauler Smith LLP. We can help you decide how to best proceed with your case.

Call 310-590-3927 or email us today.

California Automatic Renewal Law

California’s Automatic Renewal Law

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California Automatic Renewal LawThe explosion of the internet and e-commerce has led many businesses to offer their products and services through online subscription services. This has made it easier for consumers to quickly make purchases from their phone or computer, and it has also made it easier for companies to lock customers into subscriptions that renew automatically. These auto-renewal plans become problematic when companies use them to take advantage of customers who might not realize what they are signing up for. California’s Automatic Renewal Law (ARL) was a direct response to this problem, with state lawmakers codifying strong protections for consumers in these situations. The California ARL specifically requires businesses disclose all relevant subscription terms to customers, get consent from the customers before charging their credit cards, and provide customers with a way to easily cancel the contract.

To learn more about the California automatic renewal law, keep reading.

What Requirements Does California’s ARL Impose on Businesses?

Automatic renewal subscriptions affecting California consumers are governed by the state’s Automatic Renewal Law (ARL), which is set forth in Cal. Bus. & Prof. Code §§ 17600. The California ARL requires companies to clearly and conspicuously explain “automatic renewal offer terms.” State legislators passed the law for the purpose of stopping companies from continually charging consumer credit or debit cards without the consumers’ explicit consent for ongoing shipments of products or ongoing provision of services.

When a business violates the ARL by failing to properly disclose information about an auto-renewal offer, it may be possible for the customer to file a consumer fraud lawsuit and seek financial compensation from the business. If you have been billed for an automatically renewing subscription that you did not want to be enrolled in, your first step should be to speak with a California false advertising lawyer.

What Information Must Be Disclosed in California Auto-Renewal Offers?

California’s Automatic Renewal Law (ARL) is among the most consumer-friendly in the entire country, with other states modeling their own ARLs after it.

The California ARL requires companies to disclose the following information before a customer enrolls in an automatic subscription program:

  1. That the subscription will continue until the consumer cancels.
  2. A description of the policy for canceling the subscription.
  3. Any recurring charges that will be charged to the consumer’s credit card, debit card, or bank account as part of the automatic renewal plan, as well as whether the amount of the charge may change and how often the consumer will be billed.
  4. The length of the automatic renewal term. (If the service is continuous, this must also be disclosed.)
  5. Any minimum purchase obligation.

“Clear and Conspicuous” Disclosures Required Under California’s ARL

Importantly, section 17602 of the California ARL requires that the automatic renewal offer terms must be presented to the consumer both before the purchasing contract is fulfilled and after enrollment in the form of an email or other post-sale acknowledgement. There can be no concealing of the auto-renewal offer at any point in the process. Moreover, there can be no attempts by the company to thwart or frustrate a customer’s attempts to cancel the subscription. That’s because the ARL explicitly requires businesses to provide a “cost-effective, timely, and easy-to-use mechanism for cancelation.”

Additionally, those disclosures must be plainly visible and obvious to the customer. In fact, there are strict guidelines for the manner in which the information is presented. For example, the terms of the automatic subscription service must be in “visual proximity” to the request for consent to the offer. Those terms must also be presented “clearly and conspicuously” so that they can be distinguished from the rest of the offer. This means that the text of the auto-renewal offer should be:

  • In larger type than the surrounding text.
  • In contrasting type, font, or color to the surrounding text of the same size.
  • Set off from the surrounding text of the same size by symbols or other marks in a manner that clearly calls attention to the language.

Remedies Available Under California’s Auto-Renewal Law

What happens when a company violates the California automatic renewal law (ARL) by failing to clearly and conspicuously disclose the terms and conditions of a subscription service? The answer to this question depends on the facts and circumstances of your particular case, which is why it’s important for you to speak with a Los Angeles false advertising attorney who has knowledge of both state and federal automatic renewal laws, as well as other applicable California consumer protection laws like the Consumers Legal Remedies Act (CLRA) and the far-reaching Unfair Competition Law (UCL). An experienced attorney may be able to force the company to stop its misleading sale and advertisement of services, in addition to helping you get full restitution of any expenses you’ve already incurred. In some cases, you may also be entitled to additional financial compensation for your losses or harm suffered.

Call the Los Angeles False Advertising Lawyers at Tauler Smith LLP

Tauler Smith LLP is a Los Angeles law firm that focuses on consumer fraud litigation, including violations of the California Automatic Renewal Law (ARL). Our false advertising lawyers represent plaintiffs in lawsuits filed against companies that misrepresent or fail to disclose the terms of their monthly subscription contracts. Call 310-590-3927 or email us to schedule a free consultation.

Macy’s Beauty Box Lawsuit

Macy’s Faces Lawsuit for Beauty Box Automatic Subscription

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Macy’s Beauty Box Lawsuit

High-end department store Macy’s faces a lawsuit for its Beauty Box automatic subscription service. The company has been accused of violating consumer protection laws by using deceptive practices to enroll customers in an auto-renewal program for one of its popular beauty product services. Law firm Tauler Smith LLP believes that many people have probably fallen victim to Macy’s allegedly unlawful subscription practices. Since a lot of states like New York, California, and others have strict laws regulating automatic renewals, anyone who purchased the Macy’s Beauty Box from the Macys.com website may be able to file a lawsuit for financial compensation.

Tauler Smith LLP is looking to certify a class of plaintiffs nationwide for a class action lawsuit against Macy’s. If you purchased the Macy’s Beauty Box and were later charged for an ongoing subscription to which you did not consent, you should contact one of our lawyers immediately.

Macy’s Accused of Consumer Fraud

Macy’s Beauty Box is a monthly subscription package of deluxe beauty samples and beauty-related products that has attracted many customers. Unfortunately, the Beauty Box program’s terms and conditions are not always made clear to customers, which has exposed Macy’s to being named as a defendant in lawsuits in California, New York, and other states with strong consumer protection laws. For instance, the automatic renewal terms of Macy’s Beauty Box subscription program may be a violation of both the California Consumers Legal Remedies Act (CLRA) and the California Automatic Renewal Law (ARL). Specifically, Macy’s is enrolling customers into an automatic renewal subscription without providing the clear and conspicuous disclosures required by California law.

Some consumers may be unaware that they are being enrolled in an auto-renewal program when purchasing the Macy’s Beauty Box from the store’s website. For example, at least one customer has complained that she did not notice a second charge appearing on her credit card more than one month after her initial purchase. In fact, the entire checkout process on Macys.com appears to be designed to conceal the nature of the automatically renewing subscription and recurring charges. This could make it a clear violation of state consumer fraud laws, including automatic renewal laws.

Does Macy’s Beauty Box Subscription Service Violate Auto-Renewal Laws?

Macy’s, Inc. has been accused of committing numerous violations of automatic renewal laws, including the following:

  • Failure to clearly and conspicuously disclose auto-renewal terms.
  • Failure to disclose when and how often customers will be automatically billed.
  • Failure to inform customers of cancelation policy.
  • Making it difficult for customers to cancel subscription.
  • Failure to send email or other notification to customers after enrollment.

Clear & Conspicuous Disclosure

Macy’s has been accused of failing to clearly and conspicuously disclose its automatic renewal terms to customers who purchase the Macy’s Beauty Box on the store’s website. Although online customers check a box to indicate consent to be enrolled into a monthly subscription service, this box is not clear and conspicuous in the manner required by California’s ARL. For example, Macy’s does not present the auto-renewal offer terms in a larger type font than the surrounding text, nor is the text in the box distinguishable from the surrounding text via contrasting type, font, or color.

One way that Macy’s could have more clearly called attention to the automatic subscription language is by using bold, highlighted, all-capitalized, or different-colored text for the automatic renewal terms. Macy’s also could have employed a “call out” box near the terms so that the subscription enrollment contract was distinct from the product purchase agreement.

Timing of Automatic Charges

Macy’s does not adequately disclose the timing of the automatic charges. For example, the store represents that its customers will be automatically charged “monthly,” but the actual charges to consumers appear to occur in arbitrary intervals. For example, at least one customer was charged on her credit card 49 days after the initial charge.

Cancelation Policy

Macy’s does not adequately disclose how a customer can cancel their subscription. This information could be disclosed either directly on the Macy’s website or in an email sent to the customer after enrollment in the subscription service.

Frustrating Attempts to Cancel Subscription

Macy’s has failed to make it easy for a customer to cancel the subscription. In fact, it appears that Macy’s has intentionally made the cancelation process difficult and frustrating in the hopes that customers will abandon trying to cancel their subscriptions.

Email Acknowledgement After Enrollment

Macy’s fails to send an ARL-compliant retainable acknowledgement consistent with state consumer protection laws. When a customer enrolls in the Beauty Box subscription program, they do not receive an email from Macy’s that accurately explains the terms and conditions of the service. The absence of an email also means that customers are not informed of the policy for canceling the subscription. By failing to provide a permanently retainable post-transaction acknowledgement that allows for cancelation before payment, Macy’s is effectively concealing the nature of the agreement and violating state automatic renewal laws meant to protect consumers.

Macy’s Accused of Violating California’s Consumers Legal Remedies Act (CLRA)

In addition to possibly violating state automatic renewal laws, Macy’s has also been accused of violating broader consumer protection laws, such as the California Consumers Legal Remedies Act (CLRA). In California, a violation of the ARL can form the basis for a CLRA claim, as well as a claim under California’s Unfair Competition Law. One of the unlawful business practices that Macy’s has been accused of is failing to include a clear and conspicuous explanation of the price that will be charged for its Beauty Box subscription service. Another more general accusation against Macy’s is that the company fails to first obtain affirmative consent from customers before charging their credit and debit cards. All of these practices constitute violations of the ARL, which means that affected consumers may also be able to file lawsuits under the CLRA and other statutes like the Unfair Competition Law (UCL).

Tauler Smith LLP Pursuing Class Action Lawsuit Against Macy’s for ARL Violations

Tauler Smith LLP is a law firm that represents consumers in false advertising claims in California, New York, and nationwide. We suspect that thousands of consumers may have been illegally enrolled in Macy’s Beauty Box subscription program. Our consumer protection lawyers are actively seeking plaintiffs for a possible class action lawsuit against Macy’s. The lawsuit seeks the following remedies on behalf of affected consumers:

  • Full financial restitution to all purchasers throughout the United States of all purchase money obtained from the sales of Macy’s services and products that violate automatic renewal laws.
  • Monetary compensation for any damages suffered by consumers because of Macy’s unlawful business practices.
  • Punitive damages for knowing and egregious violations.
  • An injunction ordering Macy’s to cease and desist from the continued misleading sale and advertisement of its Beauty Box services.
  • A corrective advertising campaign by Macy’s to inform consumers about the true price of any services they purchase, including any automatically renewing charges in connection with those services.
  • Payment by Macy’s of all reasonable attorney’s fees and court costs related to the lawsuit.
  • Additions to the Macy’s website that include a clear and conspicuous explanation of the amount customers will be charged for the Macy’s Beauty Box subscription service.
  • The inclusion of a mechanism for obtaining customers’ affirmative consent before Macy’s charges their credit and debit cards.
  • An email or other post-transaction acknowledgement sent by Macy’s to customers that will allow for cancelation of the subscription service before the first payment.

Did You Purchase the Macy’s Beauty Box? Contact the False Advertising Lawyers at Tauler Smith LLP

Were you enrolled in a monthly subscription service after purchasing the Macy’s Beauty Box, or any other product, from the Macys.com website? The false advertising attorneys at Tauler Smith LLP represent plaintiffs in pre-trial settlement negotiations and at trial, and we have helped countless clients achieve successful outcomes that include restitution and financial compensation. We are looking for plaintiffs nationwide in a possible class action lawsuit against Macy’s.

Call or email us to discuss your eligibility to join the lawsuit.

Anxiety Supplement Lawsuit

Natrol Class Action for Anxiety Supplements

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Anxiety Supplement Lawsuit

Tauler Smith LLP, a California law firm focusing on consumer fraud litigation, recently filed a class action complaint against supplement manufacturer Natrol LLC. The Natrol class action for anxiety supplements complaint asserts that Natrol is violating the Consumers Legal Remedies Act (CLRA) by marketing its Relax+ Ultimate Calm supplement as a remedy for anxiety when it contains “ineffectual herbs, extracts, and other vitamins that plainly do not have the ability to treat anxiety.” The nutritional supplement lawsuit also alleges that when an individual uses unapproved anxiety medications like Relax+ Ultimate Calm instead of seeking treatment from a licensed doctor, they could worsen their mental health.

The Los Angeles false advertising lawyers at Tauler Smith LLP are bringing civil actions against companies that market and sell dietary supplements claiming to remedy anxiety. If you purchased one of these supplements, you may be eligible to join a class action lawsuit. Contact us today to discuss your options.

Nutritional Supplement Manufacturers Endanger Consumers with Unapproved Anxiety Drugs

Anxiety is a recognized mental disorder. When a person suffers from anxiety, they may be stricken with feelings of worry or fear while attempting to perform everyday activities. This is a major mental health concern for millions of Americans, with statistics showing that more than 40 million U.S. adults are affected by anxiety disorders. This includes millions of young children and teenagers who struggle with mental health problems.

According to the Mayo Clinic, the best way to treat an anxiety disorder is with medications prescribed by a licensed physician and psychotherapy provided by a mental health counselor. Additionally, the National Institute of Public Health (NIH) has stated that individuals should not self-diagnose or use over-the-counter supplements to treat anxiety. The nutritional supplement industry has attempted to capitalize on the country’s worsening mental health crisis in the aftermath of the COVID-19 pandemic by making unsupported claims regarding the ability of their products to relieve conditions like anxiety. When anxiety is left untreated, it can be ruinous to individuals and lead to more serious conditions and diseases.

Natrol Accused of False Advertising of the Relax+ Ultimate Calm Supplement as a Remedy for Anxiety

Natrol is a U.S. manufacturer of vitamins, minerals, and nutritional supplements. The company’s headquarters are in Chatsworth, California. According to Dun & Bradstreet, Natrol’s annual revenues surpass $121 million, which is part of the $140 billion market for dietary supplements.

The complaint alleges that Natrol puts consumers at risk by advertising its Relax+ Ultimate Calm supplement as a treatment for anxiety. The U.S. Food and Drug Administration (FDA) has issued a warning about the use of unapproved drugs to treat anxiety. Consumers who place their trust in nutritional supplement manufacturers may be more likely to forego seeking medical treatment for their health conditions, which can compound the effects of the disorders. Additionally, these individuals may be more likely to develop other mental and physical conditions because anxiety can cause depression, substance misuse, social isolation, and suicide.

Supplements Claiming to Treat Anxiety Violate the California Consumers Legal Remedies Act

The California Consumers Legal Remedies Act (CLRA) is a consumer protection statute that is meant to safeguard individuals against business fraud, including “unfair methods of competition and unfair or deceptive acts or practices in a transaction.” The CLRA, which is codified in Cal. Civ. Code §§ 1750, makes it illegal for companies to mislead consumers in advertising or sales transactions. The statute explicitly prohibits companies from “representing that goods…have…characteristics, ingredients, uses, benefits, or quantities that they do not have.” Plaintiffs can bring private civil actions under the CLRA when they have been deceived by the acts or practices of a company in the sale of consumer goods such as nutritional or dietary supplements.

Natrol has been accused of making unsupported claims about the ability of its Relax+ Ultimate Calm product to relieve anxiety. On the product packaging, Natrol prominently represents that use of the Relax+ Ultimate Calm supplement will reduce “stress, anxiety & tension” and offer other health benefits. According to the complaint, these representations are untrue and unlawful.

Class Action Lawsuit Filed Against Natrol for Violating the CLRA

The Los Angeles business fraud attorneys at Tauler Smith LLP have brought a class action lawsuit against Natrol for violating the CLRA. The legal complaint was filed in the Los Angeles County Superior Court. The complaint explains that an individual who consumes the Relax+ Ultimate Calm product “in lieu of a professional medical evaluation and treatment” is at risk of exacerbating their anxiety, as well as developing additional mental health disorders. Anyone who purchased the Relax+ Ultimate Calm supplement may be eligible to join the class action.

The class action lawsuit against Natrol seeks relief and judgment that includes the following:

  • An injunction that orders Natrol to correct its alleged deceptive marketing scheme and stop claiming that Relax+ Ultimate Calm is a remedy for anxiety.
  • An award of actual, punitive, and statutory damages to compensate the plaintiffs who purchased Relax+ Ultimate Calm.
  • Reimbursement of attorney’s fees for the plaintiffs.
  • Any other relief that the court may deem just and proper.

Did You Buy a Supplement That Claims to Treat Anxiety? Contact a California Consumer Fraud Lawyer Today

The California consumer fraud attorneys at Tauler Smith LLP are committed to protecting consumers against deceptive business practices. If you purchased a dietary supplement that claims to remedy anxiety, you should contact our legal team today to discuss your eligibility to join a class action lawsuit. Call 310-590-3927 or email us to schedule a free consultation.

CLRA Consumer Protection

What Is the Consumers Legal Remedies Act?

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CLRA Consumer Protection

California consumer fraud lawyers know that the state has been at the forefront of the consumer rights movement for a long time. In 1970, the California State Legislature passed the Consumers Legal Remedies Act (CLRA) to safeguard customers against deception by businesses. The CLRA makes it unlawful to engage in unfair or misleading acts when selling goods or services to consumers. The CLRA is often applicable in cases involving false advertising claims and/or consumer fraud. For example, when a company uses a misleading advertisement to persuade someone to purchase a product or service, the misrepresentation may constitute a violation of both the CLRA and the Unfair Competition Law (UCL). The same is true when a deceptive or intentionally confusing ad causes a customer to trigger an automatic renewal policy.

To learn more about the Consumers Legal Remedies Act, keep reading this blog.

What Deceptive Business Practices Does the CLRA Prohibit?

The California Consumers Legal Remedies Act, or CLRA, is a consumer statute that’s codified in Cal. Civil Code §§ 1750. The law allows plaintiffs to bring private civil actions against companies that use “unfair methods of competition and unfair or deceptive acts or practices in a transaction.”

The CLRA explicitly prohibits certain deceptive business practices, including the following acts:

  • Selling counterfeit goods.
  • Misrepresenting the source of a good or service.
  • Lying about a professional affiliation, certification, or endorsement.
  • Lying about the geographic origin of a product.
  • Selling a used or reconditioned item as new.
  • Misrepresenting the quality of a good or service.
  • Making false statements that disparage another business’ products.
  • Advertising items as being available for sale when they won’t be.
  • Advertising furniture as available for sale without disclosing that it is unassembled.
  • Telling a customer that a repair or replacement is necessary when it isn’t.
  • Offering a rebate or discount with hidden conditions.
  • Falsely presenting a salesperson’s authority to negotiate and finalize a transaction.
  • “Robo-calling” individuals who are not already customers.

One of the advantages of the CLRA is that victims of business fraud in California are not limited to filing lawsuits under the statute. This means that a consumer could bring multiple claims citing both the CLRA and other state or federal laws.

What Remedies Are Available to California Consumers in CLRA Cases?

The CLRA gives California consumers a powerful tool to hold businesses accountable for deceptive practices because the statute allows plaintiffs to recover different kinds of damages. The law is often interpreted broadly by courts to provide strong protections against consumer fraud, false advertising, and unfair business practices. When a consumer has been defrauded, they can file a lawsuit in a California Superior Court.

Consumers who bring a claim under the CLRA may pursue several remedies for any harm they suffered, including:

  • Actual monetary damages.
  • Punitive damages.
  • Restitution of property to the plaintiff.
  • An injunction against the defendant.
  • Attorney’s fees and court costs.
  • Any other relief the court deems proper.

Actual Damages & Attorney’s Fees

The first remedy available under the CLRA – actual damages – has a statutory minimum of $1,000 for each deceptive act or practice. The last remedy – “any other relief the court deems proper” – is a catch-all provision that gives courts wide latitude when determining what kind of monetary relief should be available to plaintiffs in CLRA actions.

In addition to getting damages for fraud, a plaintiff filing a claim under the CLRA may also be able to get attorney’s fees from a defendant who is found to have violated the Act. This can make it financially feasible for a plaintiff to bring a CLRA claim – since the defendant would have to pay the legal costs for both sides if they lose the case.

Additional Damages for Senior Citizens & Disabled Persons

A couple of special categories of consumers may be eligible for additional damages: senior citizens and disabled persons. As set forth by the CLRA, a “senior citizen” is defined as anyone over the age of 65. (In California, a senior citizen is usually defined as anyone over the age of 62, with the age threshold being lowered to 55 years old when the person lives in a senior citizen housing development.) California law defines “disabled person” quite broadly to include just about anyone who has a physical or mental condition that substantially limits at least one major life activity. For both seniors and disabled persons, the CLRA allows an award of up to $5,000 in damages to be tacked on by the court.

Proving a CLRA Violation

Although the Consumers Legal Remedies Act gives plaintiffs many options when seeking damages for consumer fraud, there are still ways for defendants to avoid paying maximum compensation. For example, if the defendant did not intentionally violate the CLRA, and they subsequently made a good faith attempt to correct the mistake, then the court might not award damages to the plaintiff. The complexities of the statute are one reason why it’s so important for you to have a knowledgeable California business fraud attorney handling your case.

Who Is Allowed to Bring a Lawsuit Under the Consumers Legal Remedies Act?

Private Civil Actions & Class Actions

The CLRA may serve as the basis for a civil suit in any consumer transaction where goods changed hands or services were provided, including transactions with a shipping insurance surcharge. Anyone who can show damages having been caused by one of the acts prohibited by the CLRA can file a lawsuit, either individually by the consumer or in a class action involving other consumers who were deceived or defrauded. For class action litigation, the cases must be substantially similar. An experienced California consumer protection lawyer can assist you with a CLRA class action lawsuit and help get your class certified.

Exclusions from the CLRA

Certain types of transactions and business owners are excluded from the Consumers Legal Remedies Act: (1) real estate transactions, and (2) newspapers and other advertisers. Although the CLRA applies to most commercial transactions, the statute cannot be used as the basis for a legal claim when the transaction involved the sale of either a residential property or a commercial property. Additionally, the CLRA cannot be used to bring a lawsuit against the owner of a newspaper, magazine, radio station, or any other advertising medium unless the plaintiff can prove that the business owner knew that the ads were deceptive before disseminating them.

How Long Do You Have to Bring a CLRA Claim?

Three-Year Statute of Limitations

It is important for you to speak with a qualified CLRA attorney as soon as possible because you do not want the statute of limitations to expire before you attempt to bring a claim. The general rule is that a consumer has three (3) years from the date on which the unfair business practice occurred to file a lawsuit under the Consumers Legal Remedies Act. If you miss this deadline, you may be barred from bringing a legal action.

Business Owner’s Opportunity to Cure

In addition to making sure you file within the statute of limitations, an experienced attorney can also ensure that you meet any other important deadlines and filing requirements. For example, before the CLRA suit can proceed in court, the consumer must notify the defendant in writing about the alleged violation. This must happen at least 30 days before the lawsuit is filed, and the business owner will then have an opportunity to take appropriate action to fix or otherwise “cure” the harm. (E.g., repairing or replacing a damaged item that was sold to the consumer.)

Contact the California CLRA Lawyers at Tauler Smith LLP

Tauler Smith LLP is a Los Angeles law firm that focuses on consumer fraud litigation. Our attorneys are extremely familiar with the Consumers Legal Remedies Act, and we have filed both private civil actions and class action lawsuits on behalf of consumers. If you were a victim of business fraud or false advertising in California, we can help you take legal action and get you the financial compensation to which you are entitled. Call or email us to discuss your eligibility to file a CLRA claim.