Friday, September 24, 2010

California Consumer Protection Laws Govern Nationwide Class in Ticketing Fee Case

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

A California trial court was directed to grant a motion certifying a nationwide class action against Ticketmaster under the California Unfair Competition Law (UCL) and False Advertising Law (FAL), in a decision by a California appellate court.

Ticketmaster allegedly misled consumers into believing that the “Order Processing Charge” and the “UPS Delivery” fee charged on its website were pass-through costs when in fact both fees were sources of profit for Ticketmaster. The trial court had found that the consumers failed to establish the court's jurisdiction over the claims of out-of-state plaintiffs.

Ticketmaster's requirement that each purchaser agree that any dispute be resolved by courts located in California and be governed by California law established sufficient contact to permit jurisdiction in California consistent with due process, according to the court. Ticketmaster had its headquarters and principal place of business in California.

Extraterritorial Application of Laws

No express geographic restriction was contained in the UCL. The UCL broadly prohibited “any unlawful, unfair or fraudulent business act or practice.” There appeared no reason why the UCL should not be applied to an out-of-state plaintiff’s claim through a contractual choice of law and forum selection provision imposed by Ticketmaster on its customers.

Although the FAL expressly limited its coverage to misleading statements made or disseminated from California, it nevertheless recognized the illegality of making false statements to “the public in any state.” This reflected the legislature's intent that the FAL should provide extraterritorial protection from false claims made in California, the court noted.

The opinion in Schlesinger v. Superior Court of Los Angeles County appears at CCH Advertising Law Guide ¶63,987.

Further details regarding the CCH Advertising Law Guide appear here.

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