Cal. Supreme Court Issues Important Decision in Consumer Protection Case

On January 29, 2009, The California Supreme Court issued an important ruling in a case under the California Consumer Legal Remedies Act ("CLRA"). Cal. Civil Code Section 1750, et seq. The Court in Meyer v. Sprint Spectrum L.P. held that a plaintiff has no standing to sue under the CLRA without some allegation that allegedly unlawful practice resulted in some kind of tangible increased cost or burden to plaintiff, even if the plaintiff seeks only injunctive relief to prevent an unlawful practice. In this case, the Court held that the plaintiff lacked standing to sue for injunctive relief to prohibit the defendant from placing an unconscionable arbitration provision in its service contract, where the defendant had no yet invoked the arbitration provision. Obviously, this is a bad ruling for consumers and consumer advocates battling mandatory pre-dispute arbitration agreements.