California Supreme Court Relaxes Proposition 64 Standing Requirements

July 2009Newsletters California Update - Third Quarter 2009

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In 2004, voters approved Proposition 64, a measure designed to limit frivolous claims under California’s Unfair Competition Law (UCL). Prop 64 limited UCL claims to those by individuals who were actually injured by, and suffered a loss because of, alleged unfair competition. Recently, the California Supreme Court weakened this injury requirement as related to class actions. The court held that only class representatives, and not all absent class members, need to comply with Prop 64 standing requirements.

The case, In re Tobacco II Cases, deals with allegations of misleading advertising and statements made about tobacco, the health implications of its use, and its addictive nature. While the subject matter of In re Tobacco II is not employment related, it’s holding has significant implications for wage and hour class actions, which often include UCL claims to extend the damage period to four years. In re Tobacco II will make it easier for plaintiffs to achieve class certification and move forward with frivolous claims which have not resulted in any injury to the employee.