The Ninth Circuit affirmed dismissal of a consumer fraud class action pursuing restitution under California’s Unfair Competition Law because the plaintiff failed to show she lacked an adequate legal remedy. Sonner v. Premier Nutrition, No. 18-15890 (9th Cir. June 18, 2020). In doing so, the Ninth Circuit resolved a split in the California federal courts regarding whether plaintiffs may pursue solely equitable relief, like restitution under the Unfair Competition Law (UCL), Consumer Legal Remedies Act (CLRA), or False Advertising Law (FAL), when legal damages under the CLRA are available in the same amount for the same alleged harm. This decision has important implications for consumer class actions in California federal courts.
BackgroundThe case arose out of allegations that Premier Nutrition marketed its dietary supplement beverage Joint Juice as supporting cartilage, lubricating joints and improving joint comfort, and that Joint Juice failed to provide these benefits. The complaint demanded injunctive relief, restitution under the UCL and CLRA, and damages under the CLRA. For those not familiar with the California statutes, the UCL authorizes restitution only, not damages, whereas the CLRA allows both. Restitution is considered an equitable remedy, even though it can result in the payment of money.
Less than two months before trial, Sonner sought leave to file an amended complaint that dropped the CLRA damages claim. This was a transparent strategic move: by dropping the CLRA damages claim, Sonner could request that the judge award $32 million as restitution in a bench trial, rather than having to persuade a jury to award this amount as damages. Premier opposed, arguing that Sonner’s proposed amended complaint would require dismissing the restitution claims because there was an adequate remedy at law for the same injury. The district court allowed the amendment, but warned Sonner that if Premier successfully dismissed the restitution claims, the court would not allow another amendment to resurrect the damages claims.
Undeterred, Sonner amended her complaint. Premier moved to dismiss, and the district court granted the motion, holding that the UCL and CLRA claims were subject to California’s inadequate-remedy-at-law doctrine, and the plaintiff had an adequate remedy at law under the CLRA.
Intra-Circuit SplitThe district court’s holding put it on one side of an intra-circuit split. On one side, courts held that plaintiffs alleging claims providing an adequate remedy at law were barred from pursuing claims for equitable relief, including under California’s consumer protection statutes, unless they could show why the available legal damages were inadequate. See, e.g., Munning v. Gap, Inc., 238 F. Supp. 3d 1195, 1203–04 (N.D. Cal. 2017); Duttweiler v. Triumph Motorcycles, 2015 WL 4941780 at *8 (N.D. Cal. Aug. 19, 2015).
On the other side of the split, courts held that, because the UCL and CLRA...
