Consumer Protection

OAKLAND – California Attorney General Rob Bonta today issued a consumer alert following Governor Newsom’s declaration of a state of emergency in Los Angeles and San Bernardino Counties in response to the Bridge Fire and in Orange and Riverside Counties in response to the Airport Fire. The Bridge Fire has burned over 51,000 acres, and the Airport Fire over 23,000 acres, forcing the evacuation of residents and threatening homes and critical infrastructure.

In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. Californians who believe they have been the victim of price gouging should report it to their local authorities or to the Attorney General at oag.ca.gov/report. To view a list of all price gouging restrictions currently in effect as a result of proclamations by the Governor, please see here.

“As numerous wildfires force evacuations across Southern California, I want to be very clear: California’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies,” said Attorney General Bonta. “If you see price gouging, please file a complaint with my office online at oag.ca.gov/report or contact your local police department or sheriff’s office.”

California law generally prohibits charging a price that exceeds, by more than 10%, the price a seller charged for an item before a state or local declaration of emergency. For items a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller's cost of the item by more than 50%. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.

Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.

OAKLAND — California Attorney General Rob Bonta today sent a letter to executives at eight of the largest social media and artificial intelligence (AI) companies, reminding them that existing California laws prohibit certain types of voter intimidation, deception, and dissuasion, and that those laws may apply to content posted on social media platforms and content generated by AI. Addressed to Alphabet Inc., Meta Platforms, Inc., Microsoft, Inc., Open AI, Inc., Reddit Inc., TikTok Inc., X Corp., and YouTube, Inc., the letter expresses concern over the continuing spread of false and misleading information on social media platforms as well as users’ enhanced capabilities to create deceptive content due to improvements in generative AI. 

“The California Department of Justice is charged with protecting the rights of our residents. This is a responsibility I take seriously,” said Attorney General Bonta. “That is why I am urging social media and AI companies to understand existing California laws and address the deception that our voters are being exposed to when it comes to their constitutional right to vote. Those deceptive activities must be better identified and reported to law enforcement — I am fully committed to working with the companies to that end. We cannot allow bad actors, whether foreign or domestic, to continue to threaten the sanctity of our democracy.”

In the letter, Attorney General Bonta underscores that: 

• Millions of Californians rely on social media and AI services to obtain news and information about upcoming elections. The 2020 general election saw a dramatic increase in the distribution of misinformation about voting on social media platforms, which provide a ready means to disseminate such content to a large audience.  
• AI has already been used to attempt to deceive voters. For example, on January 21, 2024, thousands of registered voters in New Hampshire received an automated voice message impersonating the voice of President Biden, telling them that their vote in the state’s first-in-the-nation primary election that week would not “make a difference.”
• Troublingly, many social media platforms have eased or eliminated their internal content-moderation policies, or reduced the resources dedicated to implementing those policies. 
• The California Department of Justice welcomes the opportunity to work in partnership with the companies, using the tools at our disposal to detect, prevent, and report intentional interference with voting rights when users violate state laws through their activity on social media platforms and using AI.  

Attorney General Bonta is committed to protecting the right to vote. On July 26, 2024, he filed a lawsuit against Fresno County challenging its recently passed initiative, Measure A, which amended the county’s charter to move elections for district attorney and sheriff away from the presidential cycle to the gubernatorial cycle. On April 30, 2024, he joined a coalition of 14 attorneys general in an amicus brief in support of Delaware’s election officials, who were defending a challenge to Delaware’s early voting law in Albence v. Mennella. On April 15, 2024, he filed a lawsuit against the city of Huntington Beach challenging its voter identification law, Measure A, which amended the city’s charter to purportedly allow the city to impose voter ID requirements at the polls for all municipal elections starting in 2026. On February 5, 2024, he joined a coalition of 51 bipartisan attorneys general in issuing a warning letter to a company that allegedly sent New Hampshire residents scam election robocalls during the New Hampshire primary election. On December 7, 2023, he joined a coalition of 22 attorneys general in an amicus brief in support of the plaintiffs challenging Mississippi’s constitutional provisions that permanently disenfranchise persons convicted of certain felony offenses.

A copy of the letter can be found here.

Continues commitment to protect children online

OAKLAND — California Attorney General Rob Bonta today joined a bipartisan coalition of 42 attorneys general in sending a letter to Congress supporting the United States Surgeon General’s recent call for Congress to require a surgeon general’s warning on social media platforms. Young people are facing a mental health crisis fueled by social media. The attorneys general argue that by mandating a surgeon general’s warning on algorithm-driven social media platforms, Congress can address the growing crisis and protect future generations of Americans. 

“Social media companies have continuously demonstrated an unwillingness to tackle the youth mental health crisis, instead looking to dig in deeper for the sake of profits,” said Attorney General Bonta. “Warning labels on social media are a clear and frank way to communicate the risks that social media engagement poses to young users. Just like we are certain of the risk of alcohol or cigarette use, we are certain of the mental health risks of social media use. I urge Congress to adopt this commonsense step that complements California's work to protect our children and teens.”

A growing body of research links young people’s use of social media platforms to a variety of serious harms, including depression, anxiety, and suicidal ideation. Algorithm-driven social media use also interferes with adolescents’ daily lives by chronically disrupting their sleep with irresistible algorithmic recommendations, infinite scrolling, and a constant stream of notifications designed to keep kids relentlessly engaged on the platform. 

In the letter, the attorneys general highlight states’ work to protect children online and argue that this epidemic requires federal action. A warning would clearly and straightforwardly highlight the risks that social media platforms pose for young users and complement other actions taken by states. 

Attorney General Bonta is steadfast in his commitment to protecting children online.

• In October 2023, Attorney General Bonta co-led a bipartisan coalition of 33 attorneys general in filing a federal lawsuit against Meta Platforms, alleging that Meta, among other things, designed and deployed harmful features on Instagram and Facebook that addict children and teens to their mental and physical detriment. In November 2023, Attorney General Bonta announced the public release of a largely unredacted copy of the federal complaint against Meta. The removal of the redactions provides additional context for the misconduct that the attorneys general allege.
• In March 2023, Attorney General Bonta as part of a bipartisan multistate coalition, filed an amicus brief supporting efforts to compel TikTok to produce subpoenaed materials and evidence as part of ongoing nationwide investigations into the company’s role in the growing youth mental health crisis. 
• In January 2024, Attorney General Rob Bonta, Senator Nancy Skinner, and Assemblymember Buffy Wicks introduced the Protecting our Kids from Social Media Addiction Act (SB 976), and the California Children’s Data Privacy Act (AB 1949), landmark legislation seeking to protect youth online. Both bills passed the Legislature and are on Governor Gavin Newsom’s desk awaiting signature.
• In June 2024, Attorney General Bonta, along with Los Angeles City Attorney Hydee Feldstein Soto, announced a $500,000 settlement with Tilting Point Media LLC resolving allegations that the company violated the California Consumer Privacy Act and the federal Children’s Online Privacy Protection Act by collecting and sharing children’s data without parental consent in their popular mobile app game “SpongeBob: Krusty Cook-Off.” 

A copy of the letter can be found here.

OAKLAND – California Attorney General Rob Bonta today issued a consumer alert following Governor Newsom’s declaration of a state of emergency in San Bernardino County due to the Line Fire. The fast-moving Line Fire near the City of Highland has burned over 20,000 acres, forcing the evacuation of residents and threatening homes and critical infrastructure.

In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. Californians who believe they have been the victim of price gouging should report it to their local authorities or to the Attorney General at oag.ca.gov/report. To view a list of all price gouging restrictions currently in effect as a result of proclamations by the Governor, please see here.

“As the Line Fire forces evacuations across San Bernardino County, I ask Californians to listen to communication from officials and keep safe. I also want to be clear: California’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies,” said Attorney General Bonta. “If you see price gouging, please file a complaint with my office online at oag.ca.gov/report or contact your local police department or sheriff’s office.” 

California law generally prohibits charging a price that exceeds, by more than 10%, the price a seller charged for an item before a state or local declaration of emergency. For items a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller's cost of the item by more than 50%. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.

Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.

Alert includes resources for wage theft and worker misclassification

OAKLAND — Ahead of Labor Day, Attorney General Rob Bonta issued a consumer alert, warning California workers to be on the lookout for employers who abuse their power and engage in labor trafficking, wage theft, and worker misclassification. Labor trafficking is a crime where perpetrators target vulnerable communities for the purpose of profiting from the control and exploitation of vulnerable individuals for labor through force, fraud, duress, or coercion.

"Labor trafficking is a crime that involves forcing or coercing people to perform labor or services. This Labor Day, and all days, I urge Californians — especially those in domestic service, and the agricultural, hospitality, and construction fields — to be aware of the signs of labor trafficking and speak up if you or someone you know is being exploited at work," said Attorney General Bonta. "Californians of all legal statuses must be treated with dignity on the job — California law generally prohibits law enforcement authorities from asking individuals, including those who are reporting or are victims of potential crimes, about their immigration status. As the People's Attorney, I am proud to use the full weight of my office to protect our most vulnerable workers from abuse and exploitation."

Labor Trafficking

Labor trafficking involves the deprivation of a worker’s liberty, with the intention of obtaining forced labor. It can include the recruitment, harboring, or transportation of people for labor services, through the use of force, fraud, duress, or coercion. People who experience labor trafficking receive little or no pay for their work. Traffickers can use coercive tactics such as destroying or withholding legal documents to prevent workers from leaving and can force people to work claiming a worker owes a debt to the trafficker. 

Labor trafficking can occur in homes and workplaces and arises in many fields of work, including domestic service, restaurant work, janitorial work, factory work, migrant agricultural work, the cannabis industry, and construction.  One in five people who experience labor trafficking work in private homes, which is why their trafficking often goes undetected.

Labor trafficking is often perpetrated by traffickers who are of the same cultural origin and ethnicity as the people who are trafficked, which can allow traffickers to use class hierarchy and cultural power to ensure compliance. Traffickers are known to tell workers that they will not be believed if they go to the authorities, that they will be deported from the United States, and that they have nowhere to run. Traffickers isolate workers and teach workers to trust no one but the traffickers, so workers are often suspicious of genuine offers to help. Trafficked workers often are required to live in unsanitary and overcrowded living and working conditions.  Detecting labor trafficking can be challenging. For a list of potential indicators of labor trafficking to help you recognize the signs, please visit here.

If you or someone you know is being forced to engage in any activity and cannot leave — whether it is commercial sex, domestic service, farm work, construction, factory, retail, or restaurant work, or more — you can call the National Human Trafficking Hotline at 1-888-373-7888 to access help and services. If you or someone else is in immediate danger, call 9-1-1.

It is important to remember that California law prohibits law enforcement authorities from asking individuals, including those who are reporting or who experience crimes, about their immigration status unless the information is necessary to certify the victim for a U visa (victim of crime visa) or T visa (victim of human trafficking visa).

If you need help, you can reach out to the California Department of Justice's Victims' Services Unit by callling 1-877-433-9069, visiting oag.ca.gov/victimservices, or emailing VictimServices@doj.ca.gov. Additional support may be found through local authorities and various organizations, including: 

National Human Trafficking Hotline

• Find them online at https://humantraffickinghotline.org/ (Online Chat Available);
• Text 233-733 (Be Free); or
• Call 1-888-373-7888. 

The Victims of Crime Resource Center

• Find them online at https://1800victims.org/ (Online Chat Available);
• Text or call 1-800-842-8467; or
• Email 1800VICTIMS@pacific.edu.

Additional Resources

Resources such as emergency food and shelter, legal services, and health services can be found on your city or county websites. For those who have experienced a violent crime, the California Victim Compensation Board can help cover related bills and expenses.

Wage Theft

Wage theft occurs when an employer does not pay workers’ wages for what they are owed. Historically, wage theft and other crimes against workers have not been prosecuted and instead were treated as civil matters with enforcement by labor departments. However, intentionally withholding wages from workers is a crime. When this occurs, an employer often denies workers fundamental legal rights such as fair compensation, breaks, and overtime pay. From 2014 to 2023, California workers lost an average of $2.3 to $4.6 billion from not being paid the minimum wage. Workers with the greatest chance of experiencing wage theft include garment workers, maintenance workers, restaurant workers, domestic workers, care home workers, construction or day laborers, car wash workers, and other low-wage workers.

Common examples of wage theft include:

• Being paid less than minimum wage per hour
• Not being allowed to take meal breaks, rest breaks, and/or preventative cool-down breaks
• Not receiving agreed-upon wages (this includes overtime on commissions, piece rate, and regular wages)
• Owners or managers taking tips
• Not accruing or not allowed to use paid sick leave
• Failing to be reimbursed for business expenses
• Not being paid promised vacations or bonuses
• Having unauthorized deductions from paycheck
• Not being paid split shift premiums
• Bounced paychecks
• Not receiving final wages in a timely manner
• Not receiving Reporting Time Pay
• Unauthorized deductions from your pay
• Failure to provide timely access to personnel files and payroll records

If you have experienced wage theft you can report to law enforcement and file an online wage claim with the Labor Commissioner's Office here. If you need advocate assistance with your wage claim, please refer to the following list of community organizations.

Misclassification

Misclassification of workers occurs when an employer improperly classifies their employees as independent contractors so that they do not have to pay payroll taxes, minimum wage or overtime, or comply with other wage and hour law requirements such as providing meal periods and rest breaks. “Employees,” unlike “independent contractors,” are entitled to a wide range of rights, benefits, and protections under California law, including workers’ compensation coverage if injured on the job, the right to family leave, unemployment insurance, the legal right to organize or join a union, and protection against employer retaliation.

To report the misclassification of an employee as an independent contractor, please visit the Labor Commissioner's Office here.

Attorney General Bonta is committed to defending workers' rights and investigating and prosecuting labor trafficking and wage theft. Through the Civil Rights Enforcement Section, the Worker Rights and Fair Labor Section, and the Antitrust Law Section, Attorney General Bonta enforces California’s laws to protect the welfare of California workers and legitimate businesses operating in California.

In June 2022, Attorney General Bonta announced the guilty verdicts of three members of the Gamos Family for human trafficking and labor-related charges, as well as a guilty plea by the fourth member of the family. The four individuals committed these crimes while operating Rainbow Bright, an adult residential and childcare company in the Bay Area. The defendants targeted members of the Filipino community, many of whom were recent immigrants to the United States, for human trafficking and wage theft. The defendants trafficked many of the victims using threats of arrest and deportation, and false promises to assist with immigration. In February 2023, Attorney General Bonta announced the prison sentences for three members of the Gamos Family.

To learn more about labor trafficking, please visit here. 

OAKLAND — California Attorney General Rob Bonta today filed an amicus brief in Gulkarov v. Plum, PBC, a case that alleges unfair and deceptive practices after Plum failed to disclose to consumers that its baby food products contained trace amounts of heavy metals and perchlorate. In the brief, filed in the Ninth Circuit, Attorney General Bonta defends the right of consumers victimized by deceptive omissions to sue for remedy under California’s consumer protection laws and supports the plaintiffs’ motion to bring this issue to the California Supreme Court.

“California is home to some of the most robust consumer protections nationwide and consumers deserve full protection under those laws. However, current lack of clarity inhibits effective enforcement of these laws and creates confusion,” said Attorney General Bonta. “We all understand that an omission can be as deceptive and harmful as an affirmative lie — the two should be treated the same when it comes to informing consumers about risks posed by the products they buy. I urge the Supreme Court to weigh in and apply Unfair Competition Law standards broadly to protect consumers from unfair and fraudulent business practices.” 

In the lawsuit, consumer plaintiffs sued Plum under state consumer laws including California’s Unfair Competition Law (UCL), Consumers Legal Remedies Act, and False Advertising Law, for allegedly selling certain baby food products without disclosing that they contained trace amounts of heavy metals, including lead, and perchlorate. There is no known safe level of exposure to lead. High levels of exposure to lead early in life can lead to learning disabilities and behavioral difficulties. Children are particularly vulnerable to the potential harmful effects of lead exposure.

The district court in this case granted judgment to Plum under California consumer protection laws on the grounds that plaintiffs failed to meet certain prerequisites for demonstrating a viable consumer protection claim based on omissions rather than misrepresentations. In the brief, Attorney General Bonta urges the Ninth Circuit to request that the California Supreme Court weigh in on this case so that it can clarify the standard in deciding omissions liability in the context of consumer deception claims. The state Supreme Court has never treated deceptive omissions differently from deceptive statements in the context of the UCL and has repeatedly emphasized that plaintiffs in UCL deception cases need only show that consumers are likely to be deceived. Attorney General Bonta argues that the likelihood of deception standard should apply equally to all deceptive business conduct, whether it happens to result from a misleading statement, deceptive half-truth, or clever failure to mention an important truth.

Attorney General Bonta is committed to advocating for transparency for California consumers seeking justice. In February 2024, Attorney General Bonta filed an amicus brief in Capito v. San Jose Healthcare System, LP, a case that alleges unfair and deceptive emergency room billing practices involving a surprise fee charged to all patients. In the brief, filed in the California Supreme Court, Attorney General Bonta argues the UCL standards applied by lower courts are unclear, and encourages the court to clarify when plaintiffs can sue for fraudulent business acts or practices and to adopt a standard for unfair acts or practices in UCL cases. In April 2024, Attorney General Bonta filed an amicus brief in Rosenberg-Wohl v. State Farm Fire and Casualty Co. arguing 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 copy of the brief can be found here.

Gender-based price differences for similar consumer products are illegal in California

OAKLAND — Today, on Women’s Equality Day, California Attorney General Rob Bonta issued a consumer alert, reminding Californians of their rights under AB 1287, which prohibits businesses from charging different prices for substantially similar goods based on the gender of the product’s target audience — a practice known as the “Pink Tax” when used to charge women higher prices than men for essentially the same goods. On average, products marketed to women cost 7% more than those marketed to men and as much as 13% more for personal care products. AB 1287, authored by Assemblymember Rebecca Bauer-Kahan (D-Orinda), went into effect on January 1, 2023, and is enforceable by Attorney General Bonta. If you have seen or been a victim of gender-based price differences that you believe violate the law, please file a complaint at oag.ca.gov/report.

“The Pink Tax is a sexist practice that is illegal in California. Women, especially Black and Latinx women, are paid less than their white, male counterparts in the same roles, yet have to spend more than men to buy very similar products,” said Attorney General Rob Bonta. “California consumers have the right to shop without fear of discrimination. I encourage consumers to be aware of their rights under California’s Pink Tax Law and to file a complaint if they believe there have been violations of this law.”

“It has been two years since the passage of AB 1287 and it is very exciting to see the work Attorney General Bonta is doing to guarantee consumers rights under California’s Pink Tax Law. Unequal prices for women translate to impacts for their own financial wellbeing as well as that of their families. This also exacerbates the already-existing gender gap in financial inequality," said Assemblymember Rebecca Bauer-Kahan. "Around 80 percent of product volume is gender-targeted. This type of arbitrary gendered pricing has no place in California. Closing these unnecessary and burdensome gaps is an important step toward gender equality.”  

“Women are still earning less than our male counterparts, and the fact that some companies may continue charging more for a product simply because it is marketed to women is a sexist penalty that is now illegal,” said Darcy Totten, Interim Executive Director of the California Commission on the Status of Women and Girls. “The Commission is proud to have cosponsored AB 1287 to put an end to arbitrary price differences for everyday products and encourage anyone who has been a victim of gender-based price differences to file a complaint. We are grateful to Attorney General Rob Bonta for issuing a Consumer Alert to help ensure that women and girls in our state know their rights as we collectively remove one of the last pillars of commercial gender discrimination to ensure women equal access to products without paying a “tax” for their gender.” 

In passing California’s Pink Tax Law, the Legislature cited considerable evidence of the existence of the “Pink Tax,” including a 2015 study showing that girls’ or women’s products cost more than similar products for boys or men 42% of the time.

Some examples of products where gender-based pricing may be found include:

• Toys and accessories (e.g., pink vs. red bikes and scooters, pink vs. blue helmets, arts and crafts)
• Children’s clothing
• Adult clothing
• Personal care products (e.g., hair care products, razors and razor cartridges, lotions)
• Senior/home health care products (e.g., personal urinals, supports and braces, canes)  

AB 1287 does not prohibit charging different prices for goods that are seemingly alike, but different for reasons that do not have to do with gender-based marketing. These reasons include differences in: 

• The amount of time to manufacture the goods
• Difficulty of manufacturing the goods
• Cost incurred to manufacture the goods
• Labor used to manufacture the goods
• Materials used to manufacture the goods

Women make up as much as 85% of consumer purchases in the United States — they also face higher prices for seemingly neutral products like mortgage rates. Compounded by the gender pay gap, unequal pricing translates into unjust and harmful financial impacts for women and their families. Wealth inequality disproportionally affects women and women of color. Women earn approximately 82% of what men earn. For every 1 dollar earned by white men, Latinx women earn 65 cents. AB 1287 disrupts this cycle by holding those who still charge the Pink Tax accountable. Because the Attorney General has enforcement authority for violations of California’s Pink Tax Law, it is important that we hear from the public about potential violations of the law.

If you have seen or experienced gender-based price differences that you believe violate the law, please file a complaint at oag.ca.gov/report.

For more information on AB 1287, California’s Pink Tax Law, please visit oag.ca.gov/ab1287. 

A copy of the consumer alert can be found here.  

Merger to impact consumers and workers in Southern California 

OAKLAND — California Attorney General Rob Bonta today issued a statement on the first day of trial in the state’s lawsuit challenging Kroger’s $24.6 billion purchase of Albertsons. Kroger and Albertsons are the two largest national supermarket chains in the country and this merger presents a significant risk of reduced competition and higher food prices nationwide. In California specifically, the Albertsons-Kroger merger is expected to further consolidate the highly concentrated retail grocery market in Southern California, leading consumers to face fewer choices and higher prices. The merger is also expected to reduce the ability of unions to negotiate working conditions at these stores, impacting thousands of employees in California.

In February 2024, Attorney General Bonta joined the Federal Trade Commission and a bipartisan coalition of states in filing a lawsuit that seeks to block the proposed Albertsons-Kroger merger, alleging it is in violation of the federal Clayton Act. 

“Across California, families are struggling to make ends meet and wincing at the price of everything from groceries to gas. As the People’s Attorney, it is my honor to stand up to big corporations who only care about their bottom line and directly contribute to this unaffordability. That is exactly what we are doing with this lawsuit,” said Attorney General Bonta. “This merger will leave Californians with fewer choices over where to shop – and for workers in this industry, where to work. We are in court today to prevent this unlawful attempt by Kroger and Albertsons to merge their operations and reduce competition in the marketplace.”

Pricing alignment schemes contributed to higher rent prices throughout Southern California 

OAKLAND — California Attorney General Rob Bonta today, alongside the U.S. Department of Justice, and a bipartisan coalition of eight attorneys general, filed a lawsuit against RealPage, a revenue management software company used by landlords to price multifamily rental housing units. The lawsuit alleges RealPage enabled landlords to artificially raise rents by participating in a pricing alignment scheme that increased their rent revenue across the board, enabled by the illegal sharing of confidential pricing and supply information. This harmed consumers by decreasing competition, limiting price negotiation, and increasing prices in the rental housing industry. Pricing alignment schemes affected rental housing throughout California, especially in multifamily buildings in Southern California including in Orange County, Anaheim, Santa Ana, Irvine, Riverside, San Bernardino, Ontario, Rancho Cucamonga, Temecula, Murrieta, San Diego, and Carlsbad.

“Anticompetitive agreements are illegal, whether done by a human or software program. RealPage misused private and sensitive consumer data to take the competition out of the rental industry, leaving renters no other choice but to pay the intentionally high prices that landlords agreed to set,” said Attorney General Bonta. “This means that even if rental home supply was high, rent prices stayed the same, and in some cases, rents went up. This conduct is unacceptable and illegal, and given California’s current housing shortage and affordability crisis, it is causing real harm. Every day, millions of Californians worry about keeping a roof over their head and RealPage has directly made it more difficult to do so.”

RealPage is in the business of generating rent increases and growing revenue for landlords by using algorithmic models to recommend price increases to subscribers. It does so by amassing competitively sensitive data from competing landlords through its pricing algorithms and sharing this data among subscribers. Landlords understand that their nonpublic data will be used to recommend prices not just for their own units, but also for competitors who use the programs. Landlords agree to provide this information because they understand they will benefit from the information of their rivals. In other words, RealPage knows what competing landlords are charging and can increase profits for landlords by using that information to recommend landlords set or raise their prices uniformly, thereby eliminating competition, and leaving renters no choice but to pay artificially high prices.

Over the last four decades, housing needs have significantly outpaced housing production in California. Housing costs have skyrocketed, making it harder for Californians to keep a roof over their heads. California's 17 million renters spend a significant portion of their paychecks on rent, with an estimated 700,000 Californians at risk of eviction.   

The lawsuit filed today alleges RealPage violated Sections 1 and 2 of the Sherman Antitrust Act, which prohibits anticompetitive agreements, monopolization, and attempted monopolization. Monopolization offenses occur when a single firm maintains a monopoly unlawfully, by using its control of the market to exclude rivals and harm competition. RealPage’s unlawful sharing of nonpublic, competitively sensitive data aligns landlords’ pricing and effectively removes the competitive pressure that benefits renters. Without competitive pressure, landlords have no incentive to decrease prices or offer discounts common in rental markets, like a free month or waived fees. RealPage’s rivals who lawfully compete on merits cannot guarantee landlords the increased profits that RealPage can provide, this maintains and protects RealPage’s monopoly power. 

The lawsuit seeks to end:

• The anticompetitive agreements between RealPage and its landlord customers to share confidential, competitively sensitive information.
• A pricing alignment scheme to raise rents for the American public.
• RealPage’s illegal monopoly in revenue management software built on the competitors’ data that it collects and uses.

In filing the lawsuit, Attorney General Bonta joins the U.S. Department of Justice and the attorneys general of Colorado, Connecticut, Minnesota, North Carolina, Oregon, Tennessee, and Washington.

A copy of the complaint can be found here. 

More than $20 million paid in consumer restitution

OAKLAND — California Attorney General Rob Bonta today announced filing a complaint and stipulated judgment resolving the investigation into ticket reseller StubHub, Inc. (StubHub) for failing to timely pay refunds to California consumers for canceled events during the COVID-19 pandemic. At the onset of the pandemic, StubHub failed to honor its advertised policy of providing full cash refunds for canceled events and instead issued consumers StubHub credit for future events. Following an investigation by the California Department of Justice, StubHub reversed its decision in May 2021 and began providing cash refunds to California consumers. The settlement, which was approved today in Los Angeles Superior Court, includes strong injunctive terms for future StubHub ticket sales, a penalty of $295,000, and memorializes $20 million in cash refunds that StubHub provided to more than 45,000 California consumers following the commencement of this investigation.

“By failing to issue full cash refunds for canceled events during the pandemic, StubHub not only violated its advertised policy but also violated the trust of its consumers,” said Attorney General Bonta. “My office proudly works to keep California consumers safe from false or misleading business practices. If you believe you are the victim of false or misleading advertising, please report it to oag.ca.gov/report.”

StubHub operates one of the largest online ticket reselling marketplaces, where buyers purchase tickets to concerts, sports, and other events. StubHub had long advertised that consumers would receive full refunds for tickets purchased on its website or app if the event were later canceled. StubHub made this “FanProtect Guarantee” a central part of its marketing efforts. But in late March 2020, as mass events were canceled in response to COVID-19, StubHub announced a policy change in which consumers would instead receive 120% credit for future StubHub purchases, rather than a full refund for canceled events. This new policy was applied to new ticket purchases and to consumers who had already purchased tickets based on the prior FanProtect Guarantee.

The complaint alleges StubHub violated California’s Unfair Competition Law (UCL) and California’s False Advertising Law by misleading ticket buyers who relied on the advertised refund policy when purchasing tickets before March 2020.

In addition to $20 million in consumer restitution and a $295,000 penalty under the UCL, StubHub will have to comply with significant injunctive terms requiring StubHub to abide by the UCL and other consumer protection laws, including not violating California laws specific to event ticket sales. The negotiated terms also specifically prohibit StubHub from making any misrepresentations regarding its refund policies or failing to honor the existing refund policy unless it is modified by agreement with the informed consent of the consumer.

California law imposes several obligations on ticket sellers, including with respect to canceled or rescheduled events.  As of January 1, 2022, ticket sellers must provide a full refund for any canceled event within 30 calendar days of the cancellation. For events that are postponed, rescheduled, or replaced with another event at the same time and place, a consumer is entitled to a full refund upon request, which must be provided by the ticket seller within 30 calendar days of the request.

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

• In July, Attorney General Bonta issued information for consumers following Senate Bill 478 (SB 478) going into effect on July 1, 2024. 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. 
• In May, Attorney General Bonta, alongside a 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 requires industry-wide changes to deceptive advertising practices in the marketing of cell phones.
• In April, 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.

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