Consumer Protection

OAKLAND — California Attorney General Rob Bonta announced that the U.S. District Court in Arizona denied Avid Telecom’s (Avid) attempts to dismiss and delay a bipartisan, 49-state lawsuit against the company and its owner, Michael D. Lansky, for allegedly initiating and facilitating billions of unlawful robocalls in California and around the country. Those robocalls included Social Security Administration scams, Medicare scams, and employment scams; two robocall examples can be found here and here. Forty-nine attorneys general who are also members of the Anti-Robocall Multistate Litigation Task Force sued Avid in May 2023.

“Robocalls recklessly interrupt people’s busy days and cause Californians real financial damage every year,” said Attorney General Bonta. “Avid Telecom was responsible for delivering not hundreds, or thousands, or millions of robocalls — but billions of robocalls, and will now have to take responsibility. My office stands ready to defend Californians against bad actors looking to exploit consumers.”

Avid Telecom allegedly sent or attempted to transmit more than 24 billion scam calls in a four-year period about Social Security Administration scams, Medicare scams, auto warranty scams, Amazon scams, DIRECTV scams, credit card interest rate reduction scams, and employment scams. They continued transmitting these calls even after being notified at least 329 times that these illegal robocalls were being sent across their networks. 

A copy of the order is available here.

A significant resolution to a nationwide problem 

OAKLAND — California Attorney General Rob Bonta today, alongside a bipartisan, multistate coalition, announced a $10.25 million settlement with major U.S wireless carriers after an industry-wide investigation of misleading advertising practices. The settlement, which is subject to court approval, resolves the allegations that the carriers violated the Unfair Competition Law and False Advertising Law by engaging in deceptive and misleading advertising. Today’s settlement provides strong, industry-wide injunctive relief that applies to all major wireless carriers and includes a payment of $10.25 million to the states, with $1.2 million going to California.  

“We have all heard and seen advertisements announcing too good to be true cell phone deals, offering wireless devices for free or “unlimited” data. Turns out, many of those deals are indeed too good to be true,” said Attorney General Bonta. “Wireless carriers have exploited the fact that cell phones are now essential to our day-to-day lives, especially for low-income or immigrant consumers who are more likely to depend on cell phone plans for internet access. I am proud that this settlement requires industry-wide changes to the deceptive advertising practices which have become commonplace in the marketing of cell phones. As the People’s Attorney, I am committed to enforcing consumer laws in the state of California and speaking out for consumers nationwide.”

Today’s settlement provides industry-wide injunctive relief, which addresses all of the common misleading advertising practices committed by major wireless carriers. In addition to ensuring that all advertising is truthful, accurate, and non-misleading, the wireless carriers must comply with specific requirements, including: 

• Unlimited Claims: Whenever a Wireless Carrier makes an “unlimited” data claim, they are required to clearly and conspicuously explain all material restrictions on data speed, including any thresholds at which unlimited data speeds may be slowed. Wireless carriers are prohibited from claiming that plans which set numerical caps on the quantity of data available are unlimited.  

• Switch-and-Save Offers: Whenever a Wireless Carrier makes an offer to pay a consumer’s cost to switch carriers, the Wireless Carrier must clearly and conspicuously explain all requirements a consumer must fulfill to take advantage of the offer.

• Discounted Services Claims: Whenever a Wireless Carrier makes a cost-comparison or discounted services offer, they must make comparisons between services that are similar rather than making misleading apples-to-oranges comparisons. Similarly, if a Wireless Carrier intends to provide a discount or a savings after-the-fact in the form of cash, credit, or a rebate, they must explain how the consumer will receive the funds and how long the consumer must wait to receive the funds.

• Free or Discounted Device Claims: Whenever a Wireless Carrier offers consumers a “free” device as part of a plan, they must explain everything a customer must do to obtain the “free” device, including any fees they must pay or other devices they are required to purchase. Wireless Carriers are also prohibited from increasing the price of the underlying service or other relevant devices to make up for the cost of the “free” device.

• Device Lease Claims: Whenever a Wireless Carrier offers a device on lease as opposed to for purchase, they must make that fact clear to a consumer. Wireless Carriers are prohibited from characterizing leases as purchases.

• Employee Training: The Wireless Carriers are required to train all employees responsible for advertising and all customer service representatives on the provisions of this settlement to ensure on-the-ground compliance.

• Complaint Representatives: The Wireless Carriers are required to designate a dedicated employee to work with the attorneys general to resolve complaints from everyday consumers.

Over the years, competition among wireless carriers has been growing, and advertising by the carriers has become increasingly aggressive. As more consumers use their mobile phones for internet access, especially low-income consumers whose mobile phones may be their primary form of internet access, the cost and quality of mobile phone plans is increasingly important. In 2021, 27% of people with a household income of $30,000 or less were reliant on their smartphones for online access, compared to only 6% of people with a household income of over $75,000. Cell phones and mobile plans represent one of the larger financial decisions low-income consumers make in a given year.

Attorney General Bonta is committed to investigating and remedying harm to consumers affected by unlawful and deceptive business practices. 

• Earlier this month, Attorney General Bonta, along with the District Attorneys of Alameda and Marin counties, and city and county of San Francisco, announced a $23 million settlement with Service Corporation International, the nation’s largest funeral service provider for engaging in false advertising and unlawful and deceptive acts in its marketing and sale of pre-need cremation packages.
• Also in April, Attorney General Bonta submitted a comment letter supporting the Consumer Financial Protection Bureau’s proposed rule which would close a regulatory loophole that enables banks to extract billions of dollars from consumers by charging overdraft fees without adequately disclosing basic credit terms.
• In February, Attorney General Bonta announced a settlement with two separate local Bakersfield landlords and their property management company, for multiple violations of the Tenant Protection Act, including unlawful rent increases, unlawful evictions, and failure to return security deposits on time.
• In December, Attorney General Bonta submitted a comment letter to the FCC applauding its efforts to re-establish nationwide net neutrality rules and urging the FCC not to preempt California’s own net neutrality law. In its draft order, the FCC agreed with Attorney General Bonta and concluded that California’s law is consistent with the proposed rules and should stay on the books.

Copies of the complaints can be found here, here, and here. Copies of the proposed judgments, pending court approval, can be found, here, here, and here. 

Rapidly changing technology requires responsive, flexible state privacy policy

OAKLAND — California Attorney General Rob Bonta today led a multistate coalition of 15 attorneys general urging congressional leaders to remove preemption language in the current draft of the American Privacy Rights Act (APRA), a proposed federal data privacy bill. The preemption clause currently in the APRA would result in California’s landmark privacy law being replaced with weaker protections and would hamper the ability of California to adequately protect the privacy of its citizens in the future. In today’s letter, Attorney General Bonta and colleagues from across the country call on Congress to set a floor and not a ceiling with any federal privacy law, and to respect additional protections states provide or would provide in future state-level legislation.

“Federal action to protect Americans' privacy is essential, but not at the expense of the robust protections already in place in California and in states across the country. California is at the forefront of privacy protections and must retain the ability to respond to privacy concerns as tech rapidly innovates,” said Attorney General Bonta. “We urge Congress not to undercut the important protections that states have established; states must be able to protect their residents from evolving privacy threats.”

With the first comprehensive privacy law in the country, California has the strongest protections in the nation. Californians currently have robust protections and rights to manage and control the use of their data through the California Consumer Privacy Act and other state laws. Since California passed the first comprehensive privacy law in 2018, numerous states have followed suit. States play a critical role in flexibly adapting to real-world circumstances and have set minimum data privacy standards that have driven innovation, including in the adoption of the global privacy control, and have not impeded business or technology. 

In the letter, the attorneys general highlight the importance of current and future state privacy protections, and ask that any federal privacy framework leave room for states to legislate responsively to changes in technology and data collection practices, as states are better equipped to quickly adjust to the challenges presented by technological innovation that may elude federal oversight. As Congress considers adopting APRA, the coalition urges changes to the proposed law — the APRA in its current form would impair some existing state protections and hamper state efforts to keep up with and adapt laws to changing technology.

In sending today's letter, Attorney General Bonta was joined by the attorneys general of Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, Maryland, Minnesota, Nevada, New York, Oregon, Pennsylvania, Vermont, and the District of Columbia.   

Attorney General Bonta is committed to protecting the privacy rights of Californians:  

• Last month, Attorney General Bonta and California Governor Gavin Newsom sent a letter to Congress urging congressional leaders to not include preemption language in the APRA.
• Last year, Governor Gavin Newsom, Attorney General Bonta, and the California Privacy Protection Agency (CPPA) sent a joint letter to Congress opposing preemption language in similar proposed legislation.
• In March, Attorney General Bonta joined a bipartisan multistate letter to the Federal Trade Commission expressing support for updates to the Children’s Online Privacy Protection Act and advocating for further clarity for proposed rules.
• In February Attorney General Bonta announced a settlement with DoorDash, resolving allegations that the company violated the CCPA and the California Online Privacy Protection Act (CalOPPA) by selling its California customers’ personal information without providing notice or an opportunity to opt out of that sale.
• In January, Attorney General Bonta, Assemblymember Buffy Wicks, and Senator Nancy Skinner introduced the California Children’s Data Privacy Act (AB 1949 Wicks), and the Protecting Our Kids from Social Media Addiction Act (SB 976 Skinner), landmark legislation seeking to protect youth online. These two bills would, respectively, limit the harms associated with social media addiction and provide more robust protections for kids’ data privacy.
• Earlier this year, as part of ongoing efforts to enforce the CCPA, Attorney General Bonta announced an investigative sweep, and sent letters to businesses with popular streaming apps and devices, alleging that they fail to comply with the CCPA. The sweep focused on the compliance of streaming services with CCPA’s opt-out requirements for businesses that sell or share consumer personal information, including those that do not offer an easy mechanism for consumers who want to stop the sale of their data.  
• In September 2023, Attorney General Bonta announced a $93 million settlement with Google resolving allegations that its location-privacy practices violated California consumer protection laws.

A copy of the letter can be found here. 

New law aims to tackle surge of hidden fees that are added to Californians' bills at the very end of a transaction 

California law goes into effect as federal government considers similar measures nationwide

OAKLAND — As the landmark price transparency law is set to go into effect July 1, California Attorney General Rob Bonta today released guidance to help businesses across the state comply with the new law. According to 2018 data from Consumer Reports, at least 85% of Americans have experienced a hidden or unexpected fee for a service, and more than two-thirds of those surveyed in 2023 said they were paying more now in surprise charges than they did five years earlier. Consumer Reports noted that hidden fees can increase the price of live event tickets by as much as 30% to 40%. Senate Bill 478 (SB 478) makes it illegal for businesses to advertise or list a price for a good or service that does not include all required fees or charges other than certain government taxes and shipping costs. Also known as the “Honest Pricing Law” or “Hidden Fees Statute,” SB 478 is a price transparency law that protects consumers from deceptive price advertising and allows them to make an informed decision by seeing the all-in price of goods or services up-front, before they get the bill. SB 478 has no effect on prices; the law does not ask businesses to charge less, the law does not require businesses to charge more. The Honest Pricing Law works to empower consumers by arming them with accurate information upfront, so that they can compare prices between merchants, and creates an equitable marketplace for businesses to compete. 

“Our price transparency law is about clear and honest communication with consumers, so consumers can make the financial choices that are best for them and their families. This new guidance provides information for businesses across California to ensure that clear answers are available, particularly for small businesses,” said Attorney General Rob Bonta. “The law is simple: the price you see is the price you pay. Laws work when everyone can comply. I am pleased that we can offer this guidance to help facilitate compliance with the law and make a more fair and level marketplace for businesses and consumers."

“Every consumer deserves honest, up-front pricing, and I’m proud to have worked with Attorney General Bonta and Senator Skinner to pass a law to help do just that,” said Senator Bill Dodd, D-Napa. “A consumer shouldn’t discover hidden fees made up by a business when they pay their bill.”

 “On July 1, Californians from Yreka to Calexico will be able to tell how much a product or service will actually cost right from the start,” said Ted Mermin, Director of the California Low-Income Consumer Coalition, which co-sponsored the bill. “No more getting drawn in by a falsely low advertised price only to find that the cost has doubled by the time you check out. The people of California have been played for too long. This summer, it’s game over.” 

Coauthored by Senator Bill Dodd (D-Napa) and Senator Nancy Skinner (D-Berkeley), and co-sponsored by the California Low-Income Consumer Coalition, SB 478 prohibits hidden fees in California beginning on July 1, 2024. Hidden fees are fees in which a seller uses an artificially low headline price to attract a customer and usually either discloses additional required fees in smaller print or reveals additional unavoidable charges later in the buying process.

SB 478 is a transparency law. A business can generally charge whatever amount it wants for a good or service, but the posted price must include the full amount that a consumer will pay for that good or service. The statute does not change what price a business can charge or what may be included in that cost. It simply requires that the price listed include all mandatory charges consumers will pay. 

SB 478 applies to the sale or lease of most goods and services that are for a consumer’s personal use including event tickets, hotels and other lodging, restaurants, and food delivery. SB 478 eliminates bait and switch tactics and demands transparency, so that consumers know what they are paying for and the total cost of a good or service upfront. 

California is at the forefront of a national movement against hidden and deceptive fees. Combating hidden and deceptive fees has been a top priority of the Biden-Harris Administration's economic agenda. In February, Attorney General Bonta supported the Federal Trade Commission’s (FTC) new “Rule on Unfair or Deceptive Fees,” which would ban hidden fees nationwide. The FTC’s proposed rule would prohibit unfair or deceptive practices relating to fees for goods or services, including misrepresenting the total costs of goods and services by omitting mandatory fees from advertised prices and misrepresenting the nature and purpose of fees.  

A copy of the FAQ’s can be found here. The text of the legislation is available here. 

The FAQ released today will be available in Spanish, simplified Chinese, Tagalog, Korean, and Vietnamese in the coming weeks.

OAKLAND — California Attorney General Rob Bonta, along with the District Attorneys of Alameda and Marin counties, and city and county of San Francisco, announced a settlement with Service Corporation International (SCI), the nation’s largest funeral service provider, which does business in California as the Neptune Society and the Trident Society. The settlement, which is subject to court approval, resolves the People’s enforcement action alleging that Texas-based SCI violated the Unfair Competition Law (UCL) and False Advertising Law (FAL) by engaging in false advertising and unlawful and deceptive acts in its marketing and sale of pre-need cremation packages. The proposed settlement, in the form of a stipulated judgment, provides full restitution to consumers, comprehensive injunctive relief, and $23 million in civil penalties.

“California's robust consumer protection laws protect all Californians from unlawful, unfair, and fraudulent business and marketing practices,” said Attorney General Rob Bonta. “Whether in higher education, home insurance, or the funeral service industry, deceptive business practices will not be tolerated. When consumers purchase pre-need funeral services, they expect — and the law requires — their funds to be safe and protected until those services are utilized."

“Neptune Society’s and Trident Society’s pervasive price manipulation and deceptive marketing affected all their consumer negotiations and contracts for pre-need services, demonstrating how their unlawful business practices were a result of decisions made at the highest levels of the companies,” said Alameda County District Attorney Pamela Price. “Thanks to the collaborative hard work of fellow District Attorney Offices and the Department of Justice, defrauded consumers will be made whole, and the companies will be required to pay $23 million in civil penalties and, more importantly, comply with the law requiring them to place pre-need funds in trust.”   

“Today’s settlement brings long overdue relief to the many concerned California consumers who purchased pre-need cremation products and services from the Neptune Society companies,” said Marin County Deputy District Attorney Andres Perez. “Our action further sends a clear message to the funeral industry that California laws that protect customers of these products will be strictly enforced.” 

“The pre-need cremation industry has historically been prone to abuse, which is why California law provides robust protection to consumers, many of whom are elderly,” said San Francisco District Attorney Brooke Jenkins. “I am proud that my office initiated the investigation into the unlawful practices alleged here and am pleased to have worked in partnership with the Attorney General and the other district attorneys on resolving them. This multi-million-dollar settlement should send an unmistakable message to businesses that offer cremation or funeral services: Consumer protection statutes must be strictly followed. When they are not, we will not hesitate to take action.” 

Pre-need cremation packages are a way for people to pre-pay for their cremation services while they are still alive. California law requires that all money paid for pre-need funeral arrangements be placed in trust until either the beneficiary dies and services are provided, or the consumer cancels the contract, at which point the consumer is entitled to a full refund. 

The lawsuit alleges that SCI deceptively marketed its products in a variety of ways, including by misleading consumers about its trusting practices, refund policy, and veterans’ burial benefits and cremation. Among other things, SCI routinely informed customers that they had 30 days to cancel their plans and receive a full refund, which is deceptive because pre-need customers are entitled to cancel and receive a full refund at any time before services are provided.

Sold through its Neptune and Trident locations in California, SCI’s highest-selling pre-need cremation package is one that the company marketed as the “Standard Plan.” The Standard Plan includes both cremation services and merchandise but was marketed and sold to customers as a single plan with a single price. Importantly, the Standard Plan was strategically priced to be cheaper than (or comparably priced to) stand-alone cremation services in order to induce consumers into purchasing the Standard Plan. However, when it came time to sign, SCI presented consumers with two contracts, one for heavily marked up merchandise, and one for deeply discounted cremation services. SCI then placed into trust only the discounted funds it allocated to the cremation services, keeping out of trust the funds it allocated to merchandise. Through this practice, SCI withheld from trust more than half of the total price of the Standard Plan. 

Further, when a Standard Plan purchaser requested a refund, SCI only refunded the portion it had allocated to cremation services and not any of the money allocated to merchandise. In other words, SCI typically refunded less than half of a consumer’s money. The complaint alleges that these practices violate California law, which requires funeral service providers to provide a full refund of the amount paid for the entire pre-need cremation package at any time before services are rendered.  This hurt consumers and their families, and allowed the company to artificially inflate its profitability.

Under today’s settlement, SCI will pay a $23 million civil penalty, pay full consumer restitution to the consumers who cancelled their plans but did not get a full refund, and be subject to strong injunctive terms which provide meaningful protections for California consumers. Among other things, SCI and its California locations Neptune Society and Trident Society must:

• Cease selling the Standard Plan or any similar package unless all money paid for the plan or package, as well as money paid for any collateral agreements, is placed into trust.
• Provide clear written disclosures informing consumers of their rights under California law and that consumers are not required to purchase additional products or services in order to purchase pre-need cremation services.
• Provide a full refund upon request to any consumer who cancels a pre-need funeral agreement.
• Comply with California law when advertising events or presentations regarding veterans’ benefits.

Information for Consumers Considering the Purchase of Funeral or Cemetery Arrangements:

Consumers have choices when making funeral or cemetery arrangements. While it is helpful to let your loved ones know your desires regarding burial or cremation, you are not required to prepay for funeral or cemetery services, or to buy a pre-need plan like the Standard Plan from a funeral provider. Providers must be licensed by the state, and both state and federal law provide important protections to consumers shopping for funeral and cemetery arrangements, including pre-need funeral arrangements. For example, providers are required to provide consumers with a General Price List so that they can shop around and make informed decisions, and they must provide consumers with an itemized statement of their choices upon agreeing to a contract. Pre-need plans must also come with a cancellation and refund option. For more information, please consult the Cemetery and Funeral Bureau’s guide for consumers considering the purchase of funeral or cemetery arrangements, the guide can be found here. 

Attorney General Bonta is committed to protecting California consumers and their rights across marketplaces:

• In April, Attorney General Bonta filed an amicus brief in Rosenberg-Wohl v. State Farm Fire and Casualty Co., in an effort to protect consumers’ right to challenge abusive business practices by insurance companies under the UCL.
• Also in April, Attorney General Bonta submitted a comment letter supporting the Consumer Financial Protection Bureau’s proposed rule which would close a regulatory loophole that enables banks to extract billions of dollars from consumers by charging overdraft fees without adequately disclosing basic credit terms.
• In February, Attorney General Bonta sent a letter small banks and credit unions warning that overdraft and returned deposited item fees may violate California’s Unfair Competition Law and the federal Consumer Financial Protection Act, and urged small financial institutions to eliminate these fees. 
• In February, Attorney General Bonta announced a settlement with two separate local Bakersfield landlords and their property management company, for multiple violations of the Tenant Protection Act, including unlawful rent increases, unlawful evictions, and failure to return security deposits on time.

A copy of the complaint and stipulated judgment can be found here and here, respectively. 

 OAKLAND — California Attorney General Rob Bonta today joined a broad, bipartisan coalition of 39 attorneys general in submitting letters to U.S. House and Senate leaders urging them to fund the Legal Services Corporation (LSC) in full. LSC is funded by federal appropriation and is a critical compliment to state and other funding for legal aid. LSC provides civil legal services to low-income Americans across the United States.

“As the People’s Attorney, I share a commitment to the equal access of our justice system and understand the barriers that low-income families can face when trying to access legal services,” said Attorney General Bonta. “The Legal Services Corporation provides on-the-ground legal assistance to Americans experiencing seemingly insurmountable obstacles, including our country’s Native American communities, individuals with disabilities, domestic violence survivors, survivors of natural disasters, and undocumented folks. I sincerely urge Congress to support our neighbors and prioritize investment in The Legal Services Corporation.”

Since its establishment by Congress 50 years ago, LSC has provided civil legal services to low-income Americans across the United States who otherwise would not have access to such services. LSC is funded by federal appropriation and the amount of the investment will determine the number of Americans in need that LSC will be able to assist. Each year, LSC provides grants to local nonprofits who together provide legal services to low-income individuals throughout the United States from approximately 900 offices nationwide, stretching from urban centers to small towns. However, despite 94% of federal dollars going directly toward eligible nonprofits delivering civil legal aid, the need for legal assistance is outpacing LSC's funding.

In submitting the letters, Attorney General Bonta joins the attorneys general of the District of Columbia, Georgia, Oklahoma, Massachusetts, Alaska, Arizona, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Vermont, Washington, Wisconsin, Wyoming, and American Samoa, Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.

A copy of the letters can be found here, and here. 

OAKLAND — California Attorney General Rob Bonta today announced a settlement with the University of Phoenix, and its parent company Apollo Education Group, Inc (Apollo), resolving an investigation into the University of Phoenix’s use of aggressive and unlawful military student recruitment tactics from 2012 through 2015. These recruitment tactics violated California’s Unfair Competition Law (UCL) and False Advertising Law (FAL). Under the settlement, the University of Phoenix must pay $4.5 million in penalties and other monetary relief and comply with strong injunctive terms.

“The University of Phoenix used deceptive and unlawful tactics to convince service members to use their hard-earned education benefits at its own institution, in place of any number of less expensive, high-quality schools, including California’s public colleges and universities. Part of the settlement today will be distributed to military relief organizations that provide interest-free emergency loans, financial counseling, and other critical services and supports to military members and their families,” said Attorney General Bonta. “Today’s settlement sends a strong message that schools who use predatory practices to recruit servicemembers and veterans will be held to account. California takes consumer protection seriously; we will vigorously protect those who have sacrificed so much to protect us.”

Over the past decade, for-profit schools have drawn scrutiny for using abusive tactics to recruit servicemembers and veterans. Their interest in this student population was, in part, an unintended consequence of certain provisions in the Higher Education Act of 1965, which required schools to receive at least 10% of their revenue from sources other than federal student aid. Because service-related education benefits, including Department of Defense tuition assistance and Post-9/11 GI Bill funds, counted toward the 10% revenue requirement, military students were highly sought after by for-profit institutions. For each servicemember or veteran a for-profit school enrolled, it could enroll up to nine more students whose tuition would be paid with federal student aid. In 2021, Congress and the Biden administration amended the Higher Education Act to close the “90/10” loophole.

In a complaint filed with the proposed stipulated judgment, Attorney General Bonta alleges that the University of Phoenix violated California consumer protection laws as well as directives issued by the Department of Defense to reign in aggressive and deceptive recruiting of servicemembers. Among other things, these directives require schools to obtain the permission of specified military officers before accessing a military installation, and limit how and where schools can market their programs to servicemembers. To increase their access to military bases and prospective students, University of Phoenix representatives routinely sidestepped these requirements. In addition, the complaint further alleges that University of Phoenix representatives lied in order to get access to career fairs — intended to help veterans and departing servicemembers find employment — for the purpose of soliciting prospective students, that they engaged in improper solicitation at “yellow ribbon” events designed to provide critical post-deployment resources and support to returning military personnel and their families, and that the University of Phoenix unlawfully displayed official military seals on specially made “challenge coins” that it used to promote its programs within the military community. 

In addition to paying $4.5 million in penalties and other monetary relief, including funds that will support the work of the military service relief organizations — the Navy-Marine Corps Relief Society, Army Emergency Relief, the Air Force Aid Society, and Coast Guard Mutual Assistance — to support the military community, Apollo and the University of Phoenix must comply with strong injunctive terms that aim to substantially address and curb its improper military-recruitment tactics.

Under the injunctive terms, the University of Phoenix is prohibited from:

• Violating the UCL or FAL in any entry upon or activities at military installations, or in the solicitation of service members, veterans, or their family members.
• Soliciting on-base, at career and hiring fairs, at Yellow Ribbon or other pre- or post-deployment events, at Morale, Welfare, and Recreation (MWR) events, and during on-base educational office hours.
• Attending mandatory events for service members, including training sessions and orientations.
• Attending career and hiring fairs, unless the University of Phoenix representative attending such events has duties primarily relating to the hiring of employees and is attending solely for the purpose of hiring employees.
• Unauthorized base access and the unauthorized use of military credentials to access bases.
• Unauthorized use of military seals. 

Attorney General Bonta is committed to protecting California students and military personnel.

In February, Attorney General Bonta and Senator Caroline Menjivar (D-San Fernando Valley) introduced SB 1124, essential legislation seeking to protect veterans from unaccredited claims representatives. California veterans who need assistance with filing an initial claim for benefits can receive assistance at no charge from their county veteran service office or from another U.S. Department of Veterans Affairs (VA) accredited representative. 

Also in February, Attorney General Bonta celebrated the decision by the California Court of Appeal affirming a lower court’s decision which found in the state’s favor in its lawsuit against Ashford University, an online, for-profit college, and its parent company Zovio, Inc. for violating California’s unfair competition and false advertising laws by giving students, including military veterans, false or misleading information about career outcomes, cost and financial aid, pace of degree programs, and transfer credits, in order to persuade them to enroll at Ashford. 

In September 2023, Attorney General Bonta announced the sentencing of Don Azul for defrauding the relatives of veterans as part of a fraudulent veterans educational benefits scheme. In August 2023, Attorney General Bonta joined a bipartisan collation of 44 attorneys general in a letter to Congress expressing his support for federal legislation to protect veterans from financial exploitation. In September 2022, SB 1311, a bill Attorney General Bonta sponsored to protect the rights of California service members and veterans, was signed into law. 

A copy of the complaint and stipulated judgment, which remains subject to court approval, can be found here and here.

The LA Times published an op-ed yesterday highlighting the urgent need for Senate Bill 976 (SB 976), The Protecting Our Kids from Social Media Addition Act. SB 976, authored by Senator Skinner (D-Berkeley) and sponsored by Attorney General Bonta, would limit the harms associated with social media addiction, and marks an important continuation of Attorney General Bonta’s commitment to improving child safety online.

The op-ed, excerpted below, can be read in its entirety here.

By The Times Editorial Board

From state capitols to Washington, D.C., lawmakers are scrambling to come up with regulations that can protect kids from the potential harms of social media, since the platforms have been unwilling to adopt reasonable safeguards themselves. A dozen other states, including California, are considering or have passed laws that would force companies to design their platforms to be safer for kids. 

This legislation is driven by a growing understanding that social media apps can be addictive and are dangerous to children’s mental health. The American Psychological Assn. urged again this month that policymakers require that tech companies reduce the risks embedded in the platforms.

Yet the drive for regulation is facing stiff pushback from the tech industry, which has lobbied against the bills and filed lawsuits to block new legislation from taking effect, arguing the laws are unconstitutional.  

Senate Bill 976 by Sen. Nancy Skinner (D-Berkeley) would require that social media platforms essentially turn off their algorithms for users under 18 and instead serve them content through a chronological feed from people they follow and information that they’ve searched for. The algorithms are designed to feed users a steady stream of content they didn’t necessarily ask for that keeps them on the app, which is why the algorithms have been called addictive.

The bill is sponsored by Atty. Gen. Rob Bonta, who sued Meta last year alleging the company used harmful and “psychologically manipulative product features,” such as “likes,” infinite scroll and constant alerts, to hook young people on Instagram and Facebook and keep them engaged for as much time as possible in order to boost profits.

These are reasonable safeguards and much less restrictive than proposals in other states, yet tech industry groups have opposed the bill. It’s likely that any law attempting to put guardrails on social media platforms will face legal challenges. This is complex legal and regulatory terrain, but that’s exactly why California lawmakers should keep pushing ahead with SB 976 and similar efforts. The tech industry has been unwilling to voluntarily change its practices to protect children. Lawmakers have to do it for them.

Agreement to make collaboration more efficient, effective

OAKLAND — California Attorney General Rob Bonta today announced signing a memorandum of understanding or agreement to create a new partnership with the U.S. Department of Transportation (DOT) to further air travel consumer protection efforts. The agreement formalizes collaboration between the California Department of Justice (DOJ) and DOT to more effectively and efficiently review and resolve consumer complaints and to hold airlines and ticket agents accountable when they treat consumers unfairly or deceptively. 

“In the past year, more than 200 million passengers traveled by air to and in California, these passengers deserve to be treated fairly, and if they are not, deserve to have their complaints carefully and quickly resolved,” said Attorney General Bonta. “At a time when consumer complaints over flight disruptions, lack of refunds, and lost or delayed baggage are at a record high, state and federal agencies must collaborate to address the problems consumers are facing. I thank the Department of Transportation for this partnership and celebrate today's important progress toward better accountability.”

The agreement creates a formal pathway for DOJ to elevate consumer complaints to the DOT, ensure DOT response to those complaints, and to empower DOJ to seek more information from air travel carriers or ticket agents when investigating complaints.

DOT and DOJ have shared interests regarding passengers traveling by air. DOT ensures that the rights of aviation consumers are protected by reviewing and responding to consumer complaints about air travel as well as monitoring compliance, conducting investigations, and taking enforcement action for violations of aviation consumer protection requirements. Attorney General Bonta is the chief consumer protection enforcer at the state level and enforces California’s unfair and deceptive practices statute against ticket agents. Establishing this MOU between DOT and DOJ will solidify the commitment of both parties to review and resolve consumer complaints against airlines and ticket agents, promote compliance with aviation consumer protection requirements, and to hold airlines and ticket agents accountable when they violate consumer protections.  

Attorney General Bonta is committed to ensuring robust consumer protection for air travel customers.

In March 2023, Attorney General Bonta, along with the U.S. Department of Justice and a bipartisan coalition of states, joined a lawsuit challenging the proposed merger of JetBlue and Spirit airlines, an anticompetitive combination that threatened competition in an industry already experiencing the negative impacts of market consolidation. In January 2024, Attorney General Bonta celebrated a federal district court order permanently blocking JetBlue Airways’ proposed $3.8 billion acquisition of Spirit Airlines.

In 2022, Attorney General Bonta urged Congress to pass legislation to enable states to better address consumer complaints against the airline industry. Also in 2022, Attorney General Bonta and a bipartisan coalition of attorneys general, urged the DOT to strengthen proposed regulations to increase transparency in airline ticket charges and offered specific recommendations to address drip pricing and hidden fees, reduce the rate of airline cancellations, and provide meaningful relief to airline consumers whose flights have been canceled or significantly delayed.

In 2021, Attorney General Bonta joined U.S. Department of Justice and six other attorneys general in filing a lawsuit against American Airlines and JetBlue challenging an anticompetitive joint venture between the companies that was expected to cost California consumers hundreds of millions of dollars. In 2023, Attorney General Bonta secured a decision blocking American Airlines and Jet Blue’s anticompetitive venture.

A copy of the agreement can be found here. 

OAKLAND — California Attorney General Rob Bonta today filed an amicus brief in Rosenberg-Wohl v. State Farm Fire and Casualty Co. (State Farm), a case that hinges on whether an Unfair Competition Law (UCL) action filed by a policyholder against their insurance company is subject to the UCL's four-year statute of limitations or the Insurance Code’s one-year limitations period for actions to recover on an insurance policy. The brief, filed in the California Supreme Court, argues that a UCL action is distinct from an action to recover policy benefits, therefore an insurance policy claims period cannot override the four-year statute of limitations that applies to all UCL actions. A contrary decision would hinder consumers’ ability to challenge unlawful, unfair, or fraudulent conduct by insurance companies. 

“We must protect consumers’ right to challenge abusive business practices by insurance companies,” said Attorney General Bonta. “California's Unfair Competition Law protects all 39 million Californians from unlawful, unfair, and fraudulent business practices by any industry, including insurance companies. The lower court got it wrong and if allowed to stand the decision threatens to undermine the broad protections afforded to Californians under the Unfair Competition Law. I urge the California Supreme Court to overturn the erroneous decision.”

California’s UCL prohibits businesses in California from engaging in illegal, unfair, or fraudulent practices in any aspect of their business, and allows California consumers injured by those practices to go to court to protect their rights. The UCL can also be enforced by the Attorney General and district attorneys, as well as by some city attorneys and county counsels.  

The plaintiff in this case filed an insurance claim under their homeowners’ insurance policy with State Farm, which the insurer denied. Roughly a year and a half later, the plaintiff filed a lawsuit against State Farm, alleging that it violated the UCL by engaging in unfair and misleading practices that included failing to properly investigate property insurance claims and failing to provide explanations for claim denials. The plaintiff sought injunctive relief that would require the company to reform its marketing practices and its process for investigating and resolving certain home-insurance claims. The Court of Appeal upheld the dismissal of the plaintiff’s action as untimely, holding that the plaintiff’s UCL claims were subject to the contractual one-year limitations period rather than the UCL’s four-year statute of limitations because they arose from parties’ contractual relationship.

In today’s brief Attorney General Bonta argues that the one-year limitations period set forth in the Insurance Code does not apply to a UCL action, regardless of whether the action relates to an insurance claim. The brief also notes that the Court of Appeal's decision departs from long-standing Supreme Court precedent holding that the UCL’s statute of limitations “admits no exceptions.” 

Attorney General Bonta is committed to upholding Californians’ protections under the UCL:

• In February, Attorney General Bonta sent a letter small banks and credit unions warning that overdraft and returned deposited item fees may violate state and federal consumer protection laws, and urged small financial institutions to eliminate these fees.

• Also in February, Attorney General Bonta filed an amicus brief in Capito v. San Jose Healthcare System, LP, urging the court to clarify when consumers can sue businesses for engaging in fraudulent acts or practices, and to adopt a standard for unfair acts or practices in UCL cases.

• In January 2023, Attorney General Bonta announced a lawsuit against the nation's largest insulin makers and pharmacy benefit managers for driving up the cost of the lifesaving drug through unlawful, unfair, and deceptive business practices in violation of California's consumer protection laws.

•  In September 2022, Attorney General Rob Bonta announced a lawsuit against Amazon alleging that the company stifled competition and caused increased prices across California through anticompetitive contracting practices in violation of California’s consumer protection and antitrust laws.

A copy of the amicus brief can be found here.