Actions Under California’s Unfair Competition Law (UCL) Are Not Precluded By Congress’ Repeal Of Federal Lawsuits Under Truth In Savings Act.

The provision in the federal Truth in Savings Act [TISA; 12 U.S.C. § 4301] which permitted private civil actions was repealed in 1996. The California Supreme Court issued an opinion on the issue of whether or not California’s Unfair Competition Law [UCL; Business & Professions Code section 17200 et seq.] may be based on violations of that federal statute, even though Congress repealed the provision authorizing civil actions for damages. The Supreme Court noted: “Whether framed in terms of preemption or not, the issue before us is a narrow one. The Bank and the courts below have taken the position that Congress ruled out any private enforcement of TISA by repealing former section 4310. However, considerations of congressional intent favor plaintiffs. By leaving TISA’s savings clause in place, Congress explicitly approved the enforcement of state laws ‘relating to the disclosure of yields payable or terms for accounts . . . except to the extent that those laws are inconsistent with the provisions of this subtitle, and then only to the extent of the inconsistency.’ (section 4312). The UCL is such a state law.” The court points out that, here, plaintiffs are no suing to enforce TISA; nor do they seek damages for TISA violations, and that “Instead, they pursue the equitable remedies of restitution and injunctive relief, invoking the UCL’s restraints against unfair competition. Doing so is entirely consistent with the congressional intent reflected in the terms and history of TISA. Congress expressly left the door open for the operation of state laws that hold banks to standards equivalent to those of TISA.” The Supreme Court concluded: “We hold that TISA poses no impediment to plaintiffs’ UCL claim of unlawful business practice.” Rose v. Bank of America  (Sup. Ct.; August 1, 2013) 57 Cal.4th 390, [304 P.3d 181, 159 Cal.Rptr.3d 693].