Jessica Grant, Class Actions + Mass Torts partner, secured a favorable decision from the Ninth Circuit in Sonner v. Premier Nutrition Corp., a false advertising class action in which plaintiff sought $32 million on behalf of a class of California consumers. The appeal to the Ninth Circuit sought to overturn the district court’s dismissal of plaintiff’s claims for equitable restitution under California’s Unfair Competition Law (UCL) and Consumer Legal Remedies Act (CLRA).
Plaintiff/appellant argued, along with amici the California Attorney General and Consumer Attorneys of California, that the California legislature abrogated the state’s inadequate remedy at law doctrine for claims seeking equitable restitution under the UCL and CLRA. The Ninth Circuit rejected this argument, finding that federal courts must apply equitable principles derived from federal common law to claims for equitable restitution under the statutes.
The Ninth Circuit held that “[r]egardless of whether California authorizes its courts to award equitable restitution under the UCL and CLRA, when a plain, adequate, and complete remedy exists at law, we hold that federal courts rely on federal equitable principles before allowing equitable restitution in such circumstances. And because Sonner fails to demonstrate that she lacks an adequate legal remedy in this case, we affirm the district court’s order dismissing her claims for restitution.”
In addition to the favorable outcome for Premier Nutrition Corp., the ruling reaffirms that state law can neither broaden nor restrain a federal court’s power to issue equitable relief and that a federal court must apply traditional equitable principles before awarding restitution under the UCL and CLRA, which includes the requisite showing of inadequacy of legal remedies.