In California Consumer Health Care Council v. Kaiser Foundation Health Plan, Inc., ___ Cal.App.4th ___ (Jul. 25, 2006), which was ordered published last Friday, the Court of Appeal (First Appellate District, Division Two) rejected a UCL "unlawful" prong claim predicated on an alleged violation of the Confidentiality of Medical Information Act (Civ. Code §§ 56 et seq.). Slip op. at 4-11.
In the first appellate decision to cite Mervyn's, the court alternatively held that the plaintiff's UCL claim was barred by Proposition 64:
As noted in the introduction to this opinion, appellant claims to be a public interest organization, and in its FAC specifically asserted that it was suing on “behalf of the general public.” Nowhere in the FAC did appellant allege that it was, or was authorized to represent, any Kaiser patient who had been—or even was likely to be—injured by Kaiser’s policies with regard to the transmission of its medical information. Thus, it is indisputable that, if Proposition 64 applies to this case, appellant is not authorized to maintain this UCL action against Kaiser.
Slip op. at 12. In light of its substantive ruling that the alleged conduct was not "unlawful," the court declined to remand the case for the trial court to consider possible substitution of plaintiffs. Id. at 13.