Lawsuits & Settlements

Another important action to protect kids’ online data

OAKLAND — California Attorney General Rob Bonta, along with Los Angeles City Attorney Hydee Feldstein Soto, announced a $500,000 settlement with Tilting Point Media LLC (Tilting Point) resolving allegations that the company violated the California Consumer Privacy Act (CCPA) and the federal Children’s Online Privacy Protection Act (COPPA) by collecting and sharing children’s data without parental consent in their popular mobile app game “SpongeBob: Krusty Cook-Off.” In addition to $500,000 in civil penalties, Tilting Point must comply with injunctive terms ensuring legal data collection and disclosure, including obtaining parental consent and diligence in configuring third-party software in their mobile games.

“Businesses have a legal obligation to protect kids’ data and to comply with important state and federal privacy laws designed to protect children online. Failing to do this puts our kids at risk, leaving them vulnerable to having their personal data collected, tracked, and sold,” said Attorney General Bonta. “As children spend an increasing amount of time online, both on websites and using mobile apps, we will use every enforcement tool to ensure compliance with the law and that companies exercise diligence with privacy law requirements. I thank the Los Angeles City Attorney’s Office for their work on this issue and look forward to continuing to work collaboratively with local, state, and federal partners to protect children’s privacy.”

“The “SpongeBob: Krusty Cook-Off” game is based on some of the most beloved and recognizable characters in children’s entertainment. Tilting Point Media is alleged to have collected and shared its young players' personal data, violating consumer privacy laws and industry guidelines,” said Hydee Feldstein Soto, Los Angeles City Attorney. “Protecting our children has been a top priority for my administration. I am proud to partner with Attorney General Bonta to protect children throughout our State and am grateful to the lawyers in the Public Rights Branch in my office for initiating this action to stop data harvesting of minors.” 

“SpongeBob: Krusty Cook-Off” (SpongeBob) is a popular cooking simulation game that includes both targeted advertising and in-app purchases and is directed to children under the age of 13 as well as targeted to older teens and adults. The app was first investigated by the Children’s Advertising Review Unit (CARU), a division of the Better Business Bureau National Programs that investigates potential deceptive or inappropriate data collection from children online. CARU found that the privacy and advertising practices of the SpongeBob app failed to comply with COPPA and CARU’s industry guidelines. Although Tilting Point took some corrective action, a joint investigation by the California Department of Justice and Los Angeles City Attorney’s Office found that Tilting Point was in violation of the CCPA and COPPA in connection with how the mobile app handled children’s data. Tilting Point’s age screen did not ask age in a neutral manner, meaning children were not encouraged to enter their age correctly to be directed to a child-version of the game. Additionally, Tilting Point inadvertently misconfigured third-party software development kits (SDKs), resulting in the collection and sale of kids’ data without parental consent.

In addition to paying $500,000 in civil penalties, Tilting Point media must comply with strong injunctive terms. Tilting Point must:

• Comply with the CCPA and COPPA related to children’s data in the SpongeBob game and all of its games directed to children.
• Not sell or share the personal information of consumers less than 13 years old without parental consent, and not sell or share the personal information of consumers at least 13 and less than 16 years old without the consumer’s affirmative “opt-in” consent.
• In instances where Tilting Point sells or shares the personal information of children, provide a just-in-time notice explaining what information is collected, the purpose, if the information will be sold or shared, and link to the privacy policy explaining the parental or opt-in consent required.
• Use only neutral age screens that encourage children to enter their age accurately.
• Appropriately configure third-party SDKs to comply with legal requirements related to children’s data.
• Implement and maintain a SDK governance framework to review the use and configuration of SDKs within its apps.
• Comply with laws and best practices related to advertising to minors, and minimize data collection and use from children.
• Implement and maintain a program to assess and monitor its compliance with the judgment, including annual reports to the California Department of Justice and Los Angeles City Attorney’s Office.

COPPA AND CCPA

COPPA is a federal law that requires operators of websites and online services that are either directed to children under 13, or that have actual knowledge that they are collecting personal information from children under 13, to provide notice to parents and obtain parental consent before collecting, using, or disclosing personal information from children. The CCPA is a landmark state law that secures increased privacy rights for California consumers, including the right to know how businesses collect, share, and disclose their personal information and the right to opt-out of the sale or sharing of their personal information. The CCPA imposes on businesses specific responsibilities related to children’s data, including requiring parental consent before selling or sharing personal information from children under 13 years old, and obtaining the consumer’s affirmative opt-in consent for users at least 13 and under 16 years old.  

Attorney General Bonta is committed to enforcing both COPPA and the CCPA to improve children's online safety. Today's settlement represents Attorney General Bonta's third enforcement action under the CCPA, and his continued priority to protect children online:

• In March, Attorney General Bonta joined a bipartisan multistate letter to the Federal Trade Commission proposing updates to regulations implementing COPPA and advocating for further clarity and specification for proposed rules. 
• In February, Attorney General Bonta announced a settlement with DoorDash, resolving allegations that the company violated the CCPA and COPPA, by selling 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), and the Protecting Our Kids from Social Media Addiction Act (SB 976), 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.
• In October 2023, Attorney General Bonta co-led a bipartisan coalition of 33 attorneys general in filing a federal lawsuit against Meta Platforms, alleging among other things, that Meta designed and deployed harmful features on Instagram and Facebook that addict children and teens to their mental and physical detriment. The lawsuit alleges that Meta violated federal and state laws, including COPPA, California's False Advertising Law, and California’s Unfair Competition Law.
• In 2022, Attorney General Bonta announced a settlement with Sephora, resolving allegations that the company violated the CCPA by failing to disclose to consumers that it was selling their personal information, and failing to process user requests to opt out of these sales. 

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

OAKLAND — California Attorney General Rob Bonta today, as part of a bipartisan coalition of 42 state attorneys general, announced a $700 million multistate settlement with Johnson & Johnson (J&J) resolving claims that the company violated consumer protection laws by misrepresenting the safety of its talc-based products. Specifically, J&J failed to disclose if asbestos was present in its talc products and that any asbestos present in the products is harmful and may lead to cancer. The proposed settlement, subject to court approval, bars J&J from resuming the manufacture, marketing, promotion, sale, and distribution of talc-based products. J&J stopped selling these products in the United States and Canada in 2020.

“Johnson & Johnson knew that it could not ensure the safety of its products for women and children and chose to prioritize profit over honesty. It's unacceptable, and for the people who were harmed, it's devastating,” said Attorney General Bonta. “Today and every day, I take pride in serving the people of California and holding those who compromise consumer safety accountable.”

Since 1992, J&J sold over 600 million talc products nationwide, marketed primarily as baby powder for infants and genital hygiene products for women. Talc products were marketed as safe and pure despite J&J knowing that it could not ensure the talc used in its powders was free of asbestos.

Long-standing studies have suggested a possible association between the use of powders containing talc in the genital area and the incidence of ovarian cancer. Both talc and asbestos are naturally occurring minerals that may be found in close proximity in the earth. The contamination of talc with asbestos is possible and at times, difficult to determine. Asbestos — a carcinogen that kills more than 12,000 people in the U.S. per year — is linked to diseases that are life threatening, or cause substantial pain and suffering, including mesothelioma, fibrosis, lung cancer, gastrointestinal cancer, as well as other lung disorders and diseases. There is no safe level of exposure to this highly toxic material.

In securing today’s settlement, Attorney General Bonta joins the attorneys general of Texas, Florida, North Carolina, Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and the District of Columbia. 

Attorney General Bonta is committed to investigating and remedying harm to consumers affected by unlawful and deceptive business practices. In May, Attorney General Bonta announced a $10.25 million settlement with major U.S. wireless carriers resolving allegations that the carriers violated consumer protection laws by engaging in deceptive and misleading advertising. Also in May, Attorney General Bonta announced a settlement with Liberty Tax for running deceptive advertisements that misled consumers into thinking they were getting a free advance on their tax refund when they were actually taking out a high-cost loan.

A copy of the proposed stipulated judgment, subject to court approval, can be found here. 

Blackhawk Manufacturing, Glockstore, and MDX permanently prohibited from manufacturing or selling ghost guns in or into California

OAKLAND — California Attorney General Rob Bonta and San Francisco District Attorney Brooke Jenkins, who were assisted by volunteer counsel from Giffords Law Center to Prevent Gun Violence, and Keker, Van Nest & Peters, LLP, today announced that final judgments were entered against Blackhawk Manufacturing (Blackhawk), GS Performance LLC (Glockstore), and MDX Corporation (MDX) as part of a settlement with the companies. Pursuant to the judgments, the companies will be permanently prohibited from manufacturing or selling unserialized ghost gun kits and firearm precursor parts in California. Firearm precursor parts are items that may be easily converted into a frame or receiver of a firearm, or that are marketed as such. The companies will also pay civil penalties in the following amounts: $500,000 from Blackhawk, $120,000 from Glockstore, and $55,000 from MDX. The judgments resolve allegations that the companies violated California and federal law in their manufacturing, advertising, and sale of ghost gun kits and firearm precursor parts.  

“The manufacture and sale of ghost gun kits has created a largely chaotic industry that is a massive threat to public safety,” said Attorney General Rob Bonta. “As firearm-related deaths and injuries rise, we must look for upstream interventions that get to the crux of the gun violence epidemic. Getting these manufacturers and retailers to keep untraceable ghost guns off the market is a big win for public health and safety in California.”

“The influx of unlawful and untraceable ghost guns poses a serious public safety issue to residents of San Francisco and the State at large,” said District Attorney Brooke Jenkins. “This lawsuit should serve as a reminder that firearms laws must be followed, particularly with respect to the importation and sale of firearm precursor parts into California. I am pleased to have worked with Attorney General Bonta and our pro bono partners to achieve this important result and will not hesitate to take action in the future to enforce state and federal gun laws.” 

“This is huge for California and the national fight against ghost guns.These reckless ghost gun sellers were selling ghost gun kits to California consumers who could not lawfully assemble them. Keeping these untraceable guns out of the state will save lives," said Esther Sanchez-Gomez, Litigation Director, GIFFORDS Law Center. "We were proud to work with Attorney General Bonta, San Francisco District Attorney Jenkins, and Keker, Van Nest & Peters, LLP to secure this critical win for the people of California.”

“We are proud to work alongside Attorney General Bonta, District Attorney Jenkins, and the Giffords Law Center to help end the manufacture, distribution, and sale of ghost gun kits in California,” said Brook Dooley, a partner with the law firm Keker, Van Nest & Peters. “These manufacturers have circumvented California’s gun safety laws for far too long, helping to promote an alarming public safety crisis. The unchecked proliferation of ghost guns will no longer undermine the safety of our communities.”

Ghost gun kits, which commonly contain firearm precursor parts, pose a serious public safety threat. The kits can be used to self-assemble a fully functional weapon in less than 30 minutes and are typically sold without a serial number or background check. As a result, people legally prohibited from purchasing or possessing firearms could obtain ghost guns. The lack of serial numbers on these firearms also render them essentially untraceable, making them attractive to criminals and impeding law enforcement’s ability to prevent and solve crimes. According to data reported by the California Department of Justice, Bureau of Firearms, the number of ghost guns recovered by law enforcement in California increased by more than 49,000% from 2015 to 2021. 

The complaint, which was filed in 2021, alleges that the defendants violated California consumer protection laws, and state and federal laws governing firearms. According to the complaint, the defendants violated and undermined the federal Gun Control Act by selling ghost gun kits and firearm precursor parts that are not serialized and by failing to comply with point-of-sale requirements, including background checks and recordkeeping requirements. As alleged in the complaint, the defendants also violated California’s Unsafe Handgun Act by selling kits and firearm precursor parts that produce handguns that lack required safety features, and two of the defendants violated California’s Manufacture of Firearms Law by manufacturing unfinished frames and receivers without serializing them. The complaint further alleges that the defendants misled consumers about serialization, eligibility, and safety requirements for legally assembling a firearm under California law and falsely led them to believe that the firearms built from the defendants’ products were legal.

Under the terms of the judgments, Blackhawk, Glockstore, and MDX are each permanently prohibited from manufacturing or selling any unserialized firearm precursor parts in or into California. They are also prohibited from making any statements that falsely suggest it is legal to purchase, sell, assemble, or own ghost guns or firearm precursor parts in California. The companies must also prevent future violations of California’s firearms laws by training and educating employees and providing notices to customers.

Since the complaint was filed, California’s AB 1621 was passed in 2022, which made the sale of unserialized firearm precursor parts generally illegal in the state and has helped to stem the tide of ghost guns. These judgments hold the defendants accountable for their conduct prior to the enactment of AB 1621; they do so under longstanding federal and state laws governing firearms, unsafe handguns, and fair business practices, and reinforce the applicability of those laws to the ghost gun industry.

Attorney General Bonta is committed to keeping Californians safe and stands with partners throughout the state to continue tackling the issue of gun violence strategically and aggressively by:

• Defending California’s commonsense gun laws, including its assault weapons ban and restrictions on large-capacity magazines.
• Educating the public on gun violence prevention through the Office of Gun Violence Prevention, including through data reports issued by the office to provide a robust review of gun violence and gun-related domestic violence data in California and throughout the U.S. and to help guide policy and strategy discussions related to reducing gun violence.
• Drafting and implementing regulations defining firearm precursor parts and guiding the public on firearm precursor part identification.
• Advocating for gun laws including by sponsoring Assembly Bill 1594 to increase accountability for the firearm industry and supporting The Gun Violence Prevention and School Safety Act (AB 28) to make long-term investments in community-based gun violence prevention programs, school mental health, gun crime investigations, and victim services.
• Working to strengthen federal laws to protect the public from ghost guns.
• Seizing guns from prohibited persons in the  Armed and Prohibited Persons System, and through multiagency sweeps in the Bay Area and Los Angeles County, conducting operations targeting individuals attempting to illegally purchase guns, and collaborating with local law enforcement partners.
• Calling for an investigation into an ammunition plant that sells military grade ammunition to the public that is subsidized by the American taxpayer. 

A copy of the complaint is available here. A copy of the judgment as to Blackhawk is available here, and a copy of the judgment as to Glockstore and MDX can be found here.

OAKLAND — California Attorney General Rob Bonta today, alongside the U.S. Department of Justice (U.S. DOJ), and a bipartisan coalition of 30 attorneys general, filed a lawsuit against Live Nation, the parent company of Ticketmaster, alleging unlawful conduct that has hampered competition in the ticketing and promotions of live music concerts. Live Nation’s strong domination over ticketing and promotions markets has allowed it to engage in a wide variety of anticompetitive behaviors.

“As the fifth largest economy in the world, California knows that vigorous competition is essential to a well-functioning economy,” said Attorney General Bonta. “Live Nation imposed its dominance of the live concert industry by manipulating the marketplace — sending ripples of economic injustice throughout our state. While this illegal conduct benefits Live Nation’s bottom line — it hurts artists, their fans, and our economy. This lawsuit sends a clear message: Here in California, we’re committed to protecting consumers, holding industry accountable, enforcing antitrust laws, and ensuring a fair and competitive market.”

The lawsuit alleges Live Nation 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. In addition, the complaint alleges violation of California’s Unfair Competition Law. 

The complaint filed today alleges that Live Nation protects its monopoly by using both exclusive contracts with promoters and venues to protect its dominant position in the live music industry to force artists and venues to use both its ticketing and concert promotion services. Live Nation uses their market dominance to leverage its power over all other aspects of the live music entertainment industry: from artist management, to ticketing, and promotions. For example, Live Nation has used their dominance in promotions to force venues to use Ticketmaster’s ticketing services, thereby blocking innovation and unfairly competing with competitors in the music concert business.

In the lawsuit, Attorney General Bonta, U.S. DOJ, and coalition states allege that Live Nation has:

• Harmed fans through higher fees. Fans’ ticketing experience — from buying a ticket to showtime — is also worse than it would be if the industry was competitive.

• Maintained its monopoly in ticketing markets by locking up venues through restrictive long-term, exclusive agreements and threats that venues will lose access to Live Nation-controlled tours and artists if they sign with a rival ticketer.

• Leveraged its extensive network of venues to force artists to select Live Nation as a promoter instead of its rivals, maintaining its promotions monopoly.  

The lawsuit asks the court to restore competition in the live entertainment industry by:

• Prohibiting Live Nation from engaging in its anticompetitive practices.
• Ordering Live Nation to divest Ticketmaster.
• Securing financial compensation for California, as well as for fans who were overcharged by Live Nation, leading them to pay more than they would have in a competitive market for tickets.

In filing the lawsuit, Attorney General Bonta joins the U.S. Department of Justice and the attorneys general of Arizona, Arkansas, Colorado, Connecticut, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Virginia, Washington, West Virginia, Wisconsin, Wyoming, and the District of Columbia. 

Attorney General Bonta is committed to enforcing anticompetitive laws to ensure fair prices, innovation, and consumer choice.

In March, Attorney General Bonta, alongside U.S. DOJ, and a coalition attorneys general, filed a lawsuit challenging Apple’s anticompetitive behavior related to iPhone smartphones. The lawsuit alleges Apple deliberately made it more difficult for third-party apps and products to operate with the iPhone, resulting in higher prices for consumers and harm to competition in the smartphone industry. In February, Attorney General Bonta, the Federal Trade Commission, and a bipartisan coalition of states, announced filing a lawsuit that challenges the proposed merger of Kroger and Albertsons; this merger presents a significant risk of reduced competition and higher food prices nationwide. In December 2023, Attorney General Bonta announced a $700 million multistate settlement with Google resolving allegations that the company violated state and federal laws by monopolizing the Android smartphone application market. In November 2023, Attorney General Bonta and three other attorneys general announced joining U.S. DOJ’s lawsuit against Agri Stats, Inc., a company that organizes and manages anticompetitive information exchanges for meat processors and facilitated the unlawful increase of chicken, pork, and turkey prices across the U.S.

A copy of the complaint is available here.

OAKLAND — California Attorney General Rob Bonta today announced a settlement with Liberty Tax (Liberty) for running deceptive advertisements that misled consumers into thinking they were getting a free advance on their tax refund when they were actually taking out a high-cost loan. These actions violated California law and a 2009 injunction obtained by the California Department of Justice following trial, which required Liberty to clearly disclose in every refund loan advertisement that the product is a loan. Under today’s settlement, which the court will enter as an amended judgment, Liberty must pay $150,000 in civil penalties and comply with enhanced disclosure requirements about its loan products.

“Liberty tax deceived hardworking families, eager for their tax refunds, into falling for high-priced loans. This is illegal and as the People’s Attorney, I will not stand for it,” said Attorney General Bonta. “This settlement prevents Liberty Tax from lying and misleading their customers in the future and serves as a warning to other tax preparation servicers: My office is watching, and we are prepared to go to the mat for California consumers."

Liberty provides tax preparation services directly to consumers, and as part of that, sells refund anticipation loan products, which are short-term loans with applicable fees secured by a consumer’s anticipated tax refund. 

In 2007, then Attorney General Brown sued Liberty, alleging that it deceptively advertised its refund anticipation loans by failing to clearly disclose that they were costly loans and not advances on consumers’ actual tax refunds. In 2009, Liberty was ordered to pay $1,161,699 in civil penalties and $135,866 in restitution and submit strong injunctive terms barring Liberty from deceptive advertising. Specifically, Liberty was ordered to clearly and “conspicuously” disclose in every refund loan advertisement that the product is a loan, and that fees and interest may apply.

Despite this court order, Liberty again began advertising “Easy Advance” and “Holiday Advance” refund anticipation loans online and in its stores without adequately disclosing that the products are loans. Today’s settlement imposes civil penalties for those violations and strengthens Liberty’s disclosure requirements. The new injunctive terms specifically define “conspicuous” in a number of advertising contexts, require Liberty to include the word “loan” in the name of each refund anticipation loan product, and require that Liberty use the full name of the loan product whenever the product is mentioned. This is intended to prevent marketing that might mislead consumers into thinking they are getting an advance on their tax refund when they are actually applying for a loan.

Attorney General Bonta is committed to standing up for Californians’ financial protection and their right to file taxes safely.

Last March, Attorney General Bonta issued a consumer alert with tips on preparing taxes safely, and Californians to file early, take actions to protect themselves online, and learn about free or low-cost tax filing opportunities. In May 2022, Attorney General Bonta, as part of a coalition of 51 attorneys general and with the Los Angeles City Attorney and Santa Clara County Counsel, announced a $141 million settlement against Intuit, resolving allegations that the California-based company deceptively advertised its “free” online TurboTax products. In May 2023, Attorney General Bonta  announced that consumers who were tricked by TurboTax’s owner Intuit into paying for free tax services would begin receiving checks. Californians received more than $12.2 million, distributed to the more than 400,000 consumers who were eligible for a free tax filing program and were instead deceived into paying to file their federal tax return.

The proposed judgment, which remains subject to court approval, is available here. 

Martin paid $256,997.65 in restitution to victims

SAN DIEGO — California Attorney General Rob Bonta and San Diego District Attorney Summer Stephan this week announced that defendant Marie Martin, a San Diego-based travel agent and registered seller of travel, was sentenced to six months of home confinement and six months of felony probation for embezzling travel funds from more than 150 parents who paid for eighth-grade school trips to the East Coast. After the school trips were cancelled due to the COVID-19 pandemic, Martin refused to provide refunds to the parents, instead spending funds on personal expenses. Following her guilty plea in January, as part of the sentencing, Martin paid $256,997.65 in restitution to victims.

“Parents all over California are willing to spend their time and money to give their children a better life. Marie Martin financially took advantage of more than 150 families during an already traumatic and financially challenging time,” said Attorney General Rob Bonta. “I am proud to fight for the rights of consumers and thank the San Diego District Attorney’s Office for their partnership in investigating and prosecuting this case.”

“This defendant’s disgraceful crimes cheated parents who are working to give their children expanded educational opportunities that would broaden their horizons,” said San Diego County District Attorney Summer Stephan. “Together with the Attorney General, our Consumer Protection Unit delivered justice and restitution to the families who were defrauded out of their hard-earned income.” 

In early 2019, Martin solicited funds from parents at nine schools in Los Angeles and Orange counties for eighth-grade school trips to Washington, D.C., and the East Coast. The school trips were supposed to take place in 2020, but were canceled due to the COVID-19 pandemic. When the parents who paid for these trips requested refunds, Martin declined. Instead, she allegedly used client funds for personal expenses, including credit card purchases, rent, and artwork. The investigation revealed that even before the pandemic, Martin was experiencing cash flow problems and commingling client funds. Because Martin had used the parents’ funds for personal expenses, she was unable to refund parents when the pandemic halted all travel. 

The Attorney General’s Office operates the Seller of Travel Program, which registers travel agents and certain other travel businesses operating in California. The Attorney General, local district attorneys, and city attorneys can bring enforcement actions against sellers of travel for violations of the law. Any Californian who believes they have been wronged by a seller of travel is encouraged to contact their local district attorney and/or local law enforcement agency, and file a complaint with our office at ‪www.oag.ca.gov/report. California consumers who suffer losses due to a registered seller of travel’s failure to provide travel services or refunds may be eligible to file a restitution claim with The Travel Consumer Restitution Corporation.

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. 

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 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.

LOS ANGELES – California Attorney General Rob Bonta and California Secretary of State Shirley N. Weber, Ph.D. today filed a lawsuit against the city of Huntington Beach challenging its voter identification (voter ID) 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. In the lawsuit, Attorney General Bonta and Secretary of State Weber allege that this voter ID law unlawfully conflicts with and is preempted by state law.

“The right to freely cast your vote is the foundation of our democracy and Huntington Beach’s voter ID policy flies in the face of this principle,” said Attorney General Rob Bonta. “State election law already contains robust voter ID requirements with strong protections to prevent voter fraud, while ensuring that every eligible voter can cast their ballot without hardship. Imposing unnecessary obstacles to voter participation disproportionately burdens low-income voters, voters of color, young or elderly voters, and people with disabilities. We’re asking the court to block Huntington Beach’s unlawful step toward suppressing or disenfranchising voters. The California Department of Justice stands ready to defend the voting rights that make our democracy strong.”

"This voter ID measure conflicts with state law," said California Secretary of State Shirley Weber, Ph.D. "Not only is it a solution in search of a problem, laws like these are harmful to California voters, especially low-income, the elderly, people of color, those with disabilities, and young voters.”

Today’s lawsuit comes after Huntington Beach advanced the voter ID law despite a warning from the Attorney General and Secretary of State that the measure violates state election law. On September 28, 2023, Attorney General Bonta and Secretary of State Weber sent a letter urging the city to drop the proposal and expressing grave concerns that it would only serve to suppress voter participation without providing any discernible local benefit. The city nevertheless placed the proposal on the ballot, and it passed on March 5, 2024. The Orange County Registrar of Voters certified the election results on March 22, 2024. 

In the lawsuit, the Attorney General and Secretary of State allege that Measure A is preempted by state law and invalid. Under the California Constitution, charter cities have the right to govern “municipal affairs,” but local law cannot conflict with state law governing a “statewide concern.” Both the integrity of California’s elections and the protection of the constitutional right to vote are matters of statewide concern.

The lawsuit further argues that California already maintains a uniform and robust legal scheme for safeguarding the integrity of the electoral process and protecting the rights of eligible voters. Under state law, people registering to vote must provide identifying information under penalty of perjury. Voter identity is established before registered voters get to the polls; at the polls, registered voters are only required to provide their name and address – no further identification is required. While a person’s eligibility to vote can be challenged, a challenge can only be brought by certain election workers and only on narrow, well-supported grounds. These requirements are uniform statewide, reducing potential voter confusion. 

Unlawfully departing from this legal framework, Huntington Beach’s voter ID law purportedly allows the city to require additional identification from voters before they can exercise their right to vote. By authorizing this requirement, Huntington Beach’s voter ID law conflicts with state law and threatens to unlawfully disenfranchise voters at the polls.

A copy of the complaint is available here.