Discharge Gun Firearm

Procedural Posture

Plaintiff internet user sued defendants, four payment processors, for unfair competition, alleging that each processor abetted the operation of an illegal lottery. The law of shooting Penal Code 246 . The trial court sustained the processors' demurrer without leave to amend. On appeal, the court affirmed as to three of the processors and remanded as to the fourth. The California Supreme Court directed the court to reconsider in light of subsequent case law.

Overview

The consumer asserted on appeal that he used the service of one payment processor to provide payment to an allegedly illegal Internet site. The court found that the consumer should be allowed to amend his complaint to allege actual injury as to that processor and thus meet the standing requirements of Bus. & Prof. Code, § 17200 et seq., as amended by Proposition 64. As to a second processor, the consumer could also seek to comply with the standing and class action requirements under Bus. & Prof. Code, §§ 17203, 17204, by adding additional plaintiffs who had standing. The substantive claims were sufficient as to those payment processors because the processors allegedly reviewed the serviced site and knew it was unlawful, provided substantial assistance or encouragement in the form of direct links, and had the specific intent of aiding and abetting illegal lottery operations. The substantive claims were insufficient as to the other two payment processors because the complaint did not sufficiently allege knowledge of the alleged illegal lottery or facts showing substantial assistance or encouragement.

Outcome

Procedural Posture

Appellant homeowners brought an action against respondents, their mortgage lender and a host of other corporations and individuals alleging that the manner of their marketing of the homeowners' reverse mortgage violated various state laws. The Superior Court of San Mateo County, California, granted summary judgment to respondents, concluding that federal law preempted their causes of action under state law. The homeowners appealed.

Overview

Homeowners charged respondents with elder abuse, Cal. Welf. & Inst. Code § 15600 et seq., unlawful business practices, Cal. Bus. & Prof. Code § 17200, fraudulent concealment and negligent misrepresentation challenging the adequacy and completeness of disclosures and representations made regarding the reverse mortgage homeowners claimed they were "duped" into making. Respondents claimed the Parity Act, 12 U.S.C.S. § 3803, and the Truth in Lending Act (TILA), 15 U.S.C.S. § 1601-1667f, preempted the homeowners' claims. The appellate court held that the Parity Act and TILA did not expressly, impliedly or through conflict preempt the homeowner's claims. Nor did the homeowner's claims tread on areas of federal regulation applicable to the Parity Act or TILA. The Parity Act left broad room for state regulation because there were only four federal regulations which applied to non-federally chartered housing creditors. None of homeowners' claims related to those regulations. The continued role of state law was emphasized by TILA. Moreover, the homeowners' claims advanced the purpose of TILA.

Outcome

Procedural Posture

Appellant homeowners brought an action against respondents, their mortgage lender and a host of other corporations and individuals alleging that the manner of their marketing of the homeowners' reverse mortgage violated various state laws. The Superior Court of San Mateo County, California, granted summary judgment to respondents, concluding that federal law preempted their causes of action under state law. The homeowners appealed.

Overview

Homeowners charged respondents with elder abuse, Cal. Welf. & Inst. Code § 15600 et seq., unlawful business practices, Cal. Bus. & Prof. Code § 17200, fraudulent concealment and negligent misrepresentation challenging the adequacy and completeness of disclosures and representations made regarding the reverse mortgage homeowners claimed they were "duped" into making. Respondents claimed the Parity Act, 12 U.S.C.S. § 3803, and the Truth in Lending Act (TILA), 15 U.S.C.S. § 1601-1667f, preempted the homeowners' claims. The appellate court held that the Parity Act and TILA did not expressly, impliedly or through conflict preempt the homeowner's claims. Nor did the homeowner's claims tread on areas of federal regulation applicable to the Parity Act or TILA. The Parity Act left broad room for state regulation because there were only four federal regulations which applied to non-federally chartered housing creditors. None of homeowners' claims related to those regulations. The continued role of state law was emphasized by TILA. Moreover, the homeowners' claims advanced the purpose of TILA.

Outcome

The court reversed the entry of summary judgment in favor of respondents.

The court reversed the entry of summary judgment in favor of respondents.

The court affirmed the judgment in favor of the two payment processors as to whom the substantive claims were insufficient. The court reversed the judgment as to the other two payment processors and remanded to give the consumer the opportunity to file a motion to amend the complaint so as to plead facts satisfying the standing and class action requirements for an unfair competition claim.