The plaintiffs in Rodriguez v. RWA Trucking Co., ___ Cal.App.4th ___ (Sept. 12, 2013; mod. Sept. 20, 2013), a certified class action, were owner-drivers who contracted with the defendant trucking company to haul cargo in their rigs. They brought UCL "unlawful" prong claims based on the defendant's practice of charging them for auto insurance, physical damage insurance, cargo insurance, and workers’ compensation insurance. Plaintiffs asserted that none of these forms of insurance could be sold except by a licensed insurance broker (under Ins. Code section 1631), which the defendant was not, and that the workers' compensation insurance charges were prohibited by the Labor Code (section 3751). Slip op. at 2-7.
The trial court ruled in plaintiffs' favor on all claims. The Court of Appeal (Second Appellate District, Division Four) reversed in part, holding that the claims related to the liability, damage and cargo insurance were preempted by federal law, but that the claim based on the workers' compensation insurance charges was not. Slip op. at 8-39.
In the next section of the opinion, the Court of Appeal addressed the prejudgment interest awarded by the trial court on the original judgment. Id. at 39-43. Following M&F Fishing, Inc. v. Sea-Pac Ins. Managers, Inc., 202 Cal.App.4th 1509 (2012), the Court held that "Civil Code section 3287 does not authorize prejudgment interest on an award of restitution under the UCL." Id. at 40. However, the Court concluded, the trial court does have power to award such interest under its "inherent discretionary authority." Id. at 43. The Court remanded for determination of whether interest was appropriate on the affirmed part of the judgment. Id. at 40, 43.
Other courts have reached a different conclusion on the prejudgment interest question,1 but if Rodriquez and M&F stand up, what it means as a practical matter is that prejudgment interest is discretionary, but not mandatory, in UCL actions.
1 See, e.g., In re Neurontin Marketing and Sales Practices Litigation, 2011 WL 3852254, *60 (D. Mass. Aug. 31, 2011); Irwin v. Mascott, 112 F.Supp.2d 937, 956 (N.D. Cal. 2000) (citing Tripp v. Swoap, 17 Cal.3d 671, 681 (1976)).