Procedural Posture

[Saim Khan]

Plaintiffs brought a class action against defendant communication equipment vendor, alleging five causes of action, including claims for unfair business practices under California's Unfair Competition Law (UCL), Bus. & Prof. Code, § 17200 et seq., and unjust enrichment. The Orange County Superior Court, California, sustained the vendor's demurrers and dismissed the case with prejudice. Plaintiffs appealed.

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Plaintiffs alleged that the vendor, which sold cell phones, violated the UCL by offering and selling insurance while unlicensed to do so. The court concluded that the vendor's demurrer to the UCL claim was properly sustained because plaintiffs failed to allege sufficient facts to support their standing to bring the claim. Plaintiffs failed to allege facts showing they suffered injury in fact and lost money or property as a result of the alleged unfair competition. Plaintiffs did not allege they paid more for the insurance due to the vendor's collecting a commission, nor did plaintiffs allege they could have bought the same insurance for a lower price either directly from the insurer or from a licensed agent. Absent such an allegation, plaintiffs did not show they suffered actual economic injury. Rather, plaintiffs received the benefit of their bargain, having obtained the bargained for insurance at the bargained for price. The vendor's demurrer to the unjust enrichment claim was also properly sustained because it was based on alleged violations of the California Insurance Code for which no private right of action existed, and because plaintiffs received the benefit of the bargain.

 

Outcome

The judgment was affirmed.