California’s UCL – “Inference of Common Reliance” Standard

The California Court of Appeals (Third District) recently held that plaintiffs could base a class action under California’s Unfair Competition Law on an “inference of common reliance” (as opposed to actual reliance): McAdams v. Monier. 

Plaintiffs alleged that the defendant – a manufacturer of roof tiles – failed to disclose that the color of the tiles would fade away leaving bare concrete.   The UCL count required plaintiffs to have “suffered injury in fact…and have lost money …as a result of” defendant’s failure to disclose.  (California’s UCL was amended by Proposition 64 in 2004; prior to these amendments, no reliance was required under the UCL). 

The trial court denied plaintiff’s motion to certify the class, finding the amended UCL required a showing of actual reliance, which defeated commonality.  The Court of Appeals, however, reversed imposing “an inference of common reliance” standard.

-SBS