New Gloria Bill Encourages Cities to Protect Consumers and Prosecute Unfair Business Practices

Wednesday, April 10, 2019

Assemblymember Gloria Authors Bill Empowering Cities to Confront Deceitful Businesses, Allows Cities to Retain More Civil Penalties

SACRAMENTO, CA – Protecting consumers is at the heart of new legislation announced today by California State Assemblymember Todd Gloria (D-San Diego). Assembly Bill 1477, known as the Equitable Compensation for Consumer Protection Act (ECCPA), is sponsored by San Diego City Attorney Mara Elliott and empowers large California cities to confront deceitful businesses by allowing the municipality to collect all civil penalties awarded as a result of prosecution by the city. Historically, fifty percent of awarded civil penalties were required to go to the district attorney even if the case was entirely prosecuted by a city attorney.

We want our City Attorneys to go after businesses that seek to deceive or take advantage of consumers – and our cities should be able to receive the benefit of the work its City Attorneys are doing,” said Assemblymember Todd Gloria. “This bill will ensure penalties from prosecutions of unfair business practices will be equitably distributed to cities thereby empowering city prosecutors to take on those businesses in the interest of consumers.”

Under Proposition 64 (2004), generally, only public prosecutors can file lawsuits charging unfair business practices. These lawsuits can be brought by the Attorney General, a county district attorney, or city attorneys who serve populations in excess of 750,000 people. However, even if a city attorney receives no assistance from a county district attorney in the prosecution of a case, half of the civil penalties collected must go to the county.

Assemblymember Gloria’s ECCPA changes this limitation by requiring all civil penalties collected as a result of prosecution by an eligible city attorney to be paid to the treasurer of the city whose attorney brought the action.

As City Attorney, I’m committed to protecting San Diegans from corporate pollution, privacy violations, and consumer fraud,” said San Diego City Attorney Mara Elliott. “AB 1477 will give California cities stronger tools to keep our environment healthy and to protect seniors and children from dishonest and fraudulent business practices.”

In 2017, after receiving numerous consumer complaints, San Diego City Attorney Mara Elliott filed a lawsuit under the Unfair Competition Act against a San Diego restaurant for concealing a three percent surcharge on the menu. The restaurant eventually agreed to pay $34,500 in restitution as part of the settlement reached with the City Attorney. However, even though the City Attorney received no counsel, resource, or assistance from the district attorney, half of the civil penalties awarded to the city were required to be shared equally with the county. This would no longer be the case if Assemblymember Gloria’s ECCPA is signed into law.

"Assemblymember Gloria's bill would give us an important tool in our work to protect consumers," said Los Angeles City Attorney Mike Feuer.  "As the office that sued Wells Fargo over fake accounts, the Weather Channel App over privacy issues, and electronic cigarette companies for marketing to children, the bill will give us additional funds to fight for consumers.  I want to like to thank San Diego City Attorney Mara Elliott for sponsoring this legislation." 

The bill is scheduled to be considered by the Assembly’s Judiciary Committee within the next few weeks.