Our friends at the Public Justice Foundation are fighting for consumers in California's Supreme Court. According to Arthur Bryant, Executive Director of Public Justice and the Public Justice Foundation, they are challenging an appellate court ruling that the state's constitution prevents consumers from suing companies for charging them sales tax on items that are tax-exempt. Public Justice urged the state's high court to review the appellate court's decision and the California Supreme Court has granted review.
What does this case involve? Basically, Target charged consumers for sales tax on their purchases of hot coffee "to go" from Target stores in California. There is a provision in California's Tax Code that exempts these purchases from taxation. The plaintiffs claim that Target violated California Unfair Competition Law (UCL) and the Consumers Legal Remedies Act (CLRA). Both laws are consistently recognized by courts as two of the strongest consumer protection laws in the nation.
Target argued in this case and the Court of Appeals agreed that the consumers' claims are barred by a provision of the California Constitution that bars courts from hearing lawsuits brought by taxpayers against the "State or any officer thereof." However, Public Justice and the plaintiffs rightly point out that Target is not the "State or any officer thereof" and consumers in this case are not taxpayers. The way it works in California is retailers pay sales tax to the state and consumers pay sales tax reimbursement to the retailers.
"I agree with Bryant 100 percent. What Target did here was fraud. I'm sure they know better. I wonder if they passed the payment on to the state or kept it for themselves? Why didn't Target, when first advised about this situation, simply admit they made a mistake and fix it instead of fighting its own customers in court?" asked John Bisnar, senior partner of the BISNAR | CHASE Personal Injury Attorneys.
These types of class-action lawsuits are necessary and beneficial to the public good. The state, with its budget woes and depletion of resources, simply does not have the ability or the will to police these types of illegal activities. Such lawsuits empower ordinary citizens who have been wronged, in this case by a corporate giant, to enforce the law and bring about justice. Another purpose of these lawsuits is also to encourage other firms and corporations to comply with the law or face similar lawsuits.
Target, in this case, is also making an effort to blunt the force of class action and have the court that the only recourse and each and every person who was charged this illegal tax has is to apply to the State of California for a tax refund. Target knows perfectly well that few people would actually do that, especially when the amount each person is taxed is less than 25 cents.
Class action has been the "whipping boy" of business for a long time. That's because the big boys know perfectly well that it is the only way consumers have to hold big companies accountable when they rip off thousands or millions of people for a small amount each. Corporations hate the idea that consumers can collectively hold them accountable through class action lawsuits. And without class action lawsuits, consumers have no realistic means to fight back. It is indeed a powerful tool for consumers because the economics of these cases make sense only if a large group of people joined together to bring these claims.
There is no question that consumers must be able to protect themselves from the fraudulent, strong-arm actions of business, if the state won't enforce the law. Businesses such as Target that are acting in an unfair or illegal manner avoid paying the price of that conduct if the people who are harmed by this conduct must litigate alone, be a lone voice against the conduct, rather than joined together with hundreds or thousands or millions of other voices. The costs are in the hundreds of thousands to fight a lawsuit like this one against a big company like Target. No one would do it alone
The BISNAR|CHASE personal injury law firm is not representing any of the parties mentioned in this article at the time the article was posted. Our information source is cited in the article. If you were involved in this incident or a similar incident and have questions as to your rights and options, call us or another reputable law firm. Do not act solely upon the information provided herein. Get a consultation. The best law firms will provide a free consultation. We provide a free, confidential consultation to not at fault persons named in this article. The free consultation offer extends to family members as well.
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