ARE THERE ANY LAWS TO PROTECT CONSUMERS IN CALIFORNIA?

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California is home to some of the strongest consumer protection laws in the country.  The California Consumer Legal Remedies Act (“CLRA”), codified at California Civil Code §§ 1750-1784, is the hallmark of those laws.  California Assemblyman James A. Hayes introduced the CLRA, which was passed by the State Legislature in its 1970 Regular Session and signed into law by Governor Ronald Reagan, taking effect on January 1, 1971. 

On May 25, 1970, Assemblyman Hayes explained that the legislation was meant to eliminate “reprehensible” business practices that should not be “employed by legitimate businessmen.”  Assemblyman Hayes also explained that the CLRA was meant to benefit “the honest merchant” just as it much as “the consumer” by eliminating the “competitive advantage” of the “dishonest businessman.” 

Over 50 years later, the CLRA remains on the books, targeting the ever-evolving nature of improper business practices.  As recently as October 7, 2023, Governor Gavin Newsom signed into law Senate Bill (“SB”) 478, expanding the CLRA to prohibit businesses from including hidden fees (“junk fees”) that are not disclosed at the outset of the purchasing process.  SB 478 was crafted to make it easier for families to understand the price of goods and services, and takes effect on July 1, 2024.

SB 478 will add to an already robust CLRA, which targets various deceptive business practices.  For example, Section 1770(a) of the CLRA prohibits representing that “goods or services have sponsorship, approval, characteristics, uses, benefits, or quantities that they do not have” or that “goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another.  That section also prohibits advertising “goods or services with intent not to sell them as advertised” and representing that “a transaction confers or involves rights, remedies, or obligations that it does not have or involve, or that are prohibited by law.” 

Importantly, the legislature directed that the CLRA be “liberally construed and applied to promote its underlying purposes, which are to protect consumers against unfair and deceptive business practices and to provide efficient and economical procedures to secure such protection.”  Cal. Civ. Code § 1780.  As James S. Reed—who served as Chief Counsel for the Assembly Judiciary Committee of the California Legislature at the time the CLRA was drafted and passed by the Legislature—has written, this “policy statement was intended to be a concise guide to the interpretation and application of its many provisions.  The message is clear—when in doubt, decide in the consumer’s favor.” 

Consistent with its purpose to protect consumers, the CLRA provides for a wide range of remedies.  Specifically, the CLRA permits a consumer who suffered damages due to deceptive business practices to bring an action to recover actual damages, an “order enjoining a method, act or practice, punitive damages, and “any other relief that the court deems proper.”  Cal. Civ. Code § 1780.  Additionally, a prevailing plaintiff is entitled to costs and attorney’s fees.  If, however, a defendant prevails and the court finds that a plaintiff’s prosecution was not in good faith, then the court has discretion to award the defendant reasonable attorney’s fees. Any individual considering legal recourse should consult a qualified attorney who can evaluate the applicable laws, relevant legal developments, and specific facts of a given case.

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