Court of Appeal Issues UCL and CLRA Class Certification Decision

In McAdams v. Monier, Inc., --- Cal.Rptr.3d ----, 2010 WL 630973 (February 24, 2010) the Third District Court of Appeal once again reversed a trial court order denying class certification in a case under the Unfair Competition Law (UCL) and the Consumer Legal Remedies Act (CLRA).

The plaintiffs alleged that the defendant failed to disclose that the color composition of its roof tiles would erode away, leaving bare concrete, well before the end of the tiles' represented 50-year lifetime. In a prior published opinion, the Court of Appeal reversed the trial court's order denying certification. The California Supreme Court granted review and held pending its decision in In re Tobacco II Cases (2009) 46 Cal.4th 298 (Tobacco II), which concerned standing issues arising from the 2004 amendment to the UCL by Proposition 64. (My post on Tobacco II is here.) On remand following Tobacco II, the Court of Appeal held that an “inference of common reliance” may be applied to a CLRA class that alleges a material misrepresentation consisting of a failure to disclose a particular fact:

The record here permits an inference of common reliance among the CLRA class. Plaintiff alleges that Monier made a single, material misrepresentation to class members that consisted of a failure to disclose a particular fact regarding its roof tiles. Plaintiff has tendered evidence that Monier knew but failed to disclose to class members that the color composition of its roof tiles would erode to bare concrete well before the end of the tiles' represented 50-year life; and that this failure to disclose would have been material to any reasonable person who purchased tiles in light of the 50-year/lifetime representation, or the permanent color representation, or the maintenance-free representation. If plaintiff is successful in proving these facts, the purchases common to each class member-that is, purchases pursuant to this alleged failure to disclose in light of the 50-year life, permanent color, or maintenance-free representations-would be sufficient to permit an inference of common reliance among the class on the material misrepresentation comprising the alleged failure to disclose. This is also why the CLRA class definition is subject to the proviso specified at the end of this opinion's introduction. (See p. 3, ante.)

Slip op. at 5.

After reviewing Tobacco II with regard to the UCL, the Court held: "Since individualized proof of reliance and injury is not required for non-representative class members, the issues of reliance and injury do not foreclose a UCL class action here." Slip op. at 11. The Court then remanded for the trial court "to determine if the representative plaintiff meets the UCL standing requirements set forth in Tobacco II." Slip op. at 11.