California Voters Limit Unfair Competition Claims
On November 2, 2004 California voters amended Section 17200 et seq of the California Business and Professions code. Prior to the amendment, plaintiffs’ attorneys could sue for unfair competition on behalf of the general public. Proposition 64 modified the law such that an attorney may only sue on behalf of a client who has suffered a monetary or property loss as the result of advertising claims.
The amendment does not lower standards imposed upon advertisers to deliver consumer messages that are accurate and not misleading, but may make it easier for advertising to push the envelope for certain claims. That noted, the amendment does not apply to state actors, such as district attorneys, county counsels, or the state Attorney General. For any cases that are brought against an advertiser, the amended law provides that resultant penalties be used to enforce consumer protection laws.