New UCL "unfair" prong opinion: West v. JPMorgan Chase Bank, N.A.

In West v. JPMorgan Chase Bank, N.A., ___ Cal.App.4th ___ (Mar. 18, 2013), the Court of Appeal (Fourth Appellate District, Division Three) nicely summarized the three-way split in authority on "unfair" conduct in UCL consumer actions:

Severaldefinitions of “unfair” under the UCL have been formulated.  They are:

1.  “An act or practice is unfair if the consumerinjury is substantial, is not outweighed by any countervailing benefits toconsumers or to competition, and is not an injury the consumers themselvescould reasonably have avoided.”  (Daugherty v. American Honda Motor Co., Inc. (2006)144 Cal.App.4th 824, 839.)

2.  “‘[A]n “unfair” business practice occurs whenthat practice “offends an established public policy or when the practice isimmoral, unethical, oppressive, unscrupulous or substantially injurious toconsumers.”  [Citation.]’  [Citation.]” (Smith v. State Farm MutualAutomobile Ins. Co. (2001) 93 Cal.App.4th 700, 719.)

3.  An unfair business practice means “‘thepublic policy which is a predicate to the action must be “tethered” to specificconstitutional, statutory or regulatory provisions.’”  (ScrippsClinic v. Superior Court (2003) 108 Cal.App.4th 917, 940.)

Slip op. at 28.  The Court held that the plaintiff's complaint adequately alleged that the defendant "engagedin unfair business practices under any of the three definitions," and that the trial court had improperly sustained the defendant's demurrer to the UCL cause of action.  Id. at 29.