Puttin’ on the s. 17200 ritz

A California court of appeal has rejected a lawsuit under the state’s s. 17200 (“unfair competition”) law (see Mar. 12, Dec. 8 and links from there) demanding class-action damages against the Ritz-Carlton hotel chain over its practice of adding an automatic gratuity to room service. Although the claimant conceded that the hotel’s room service menu did warn guests of the charge, he argued that the warning was not in big enough print. And Sacramento sole practitioner Brian Kindsvater, accused of abusing the law, has reached an agreement with the state attorney general’s office to return about $35,000 in settlements from various businesses he sued under s. 17200, including travel agency websites and video stores. “According to the AG’s complaint, Kindsvater helped form a shell corporation called Consumer Action League, which served as plaintiff in the suits. … [The agreement also] also forbids him from making false statements that settling 17200 cases protects defendants from similar actions.” (Jeff Chorney, “Attorney Agrees to Return Unfairly Won Settlements”, The Recorder/New York Lawyer, Mar. 25) (via Tim Sandefur, Apr. 21 and Mar. 25 respectively). Fresh from his resounding political victory in achieving workers’ compensation reform, Gov. Arnold Schwarzenegger is likely to turn his attention to other economic agenda items, among them whether to throw his weight behind an expected business-backed initiative on the November ballot to rein in s. 17200 lawsuits (Marc Lifsher, “Schwarzenegger Has Long To-Do List to Boost Business”. L.A. Times, Apr. 20). One case for s. 17200 reform: Lance T. Izumi (Pacific Research Institute), “Laws, courts unfair to businesses in state”, L.A. Daily News, Apr. 15.

Comments are closed.