Ball v. GTE Mobilnet of California

In Ball v. GTE Mobilnet of California (2000) 81 Cal.App.4th 529 the plaintiffs alleged causes of action for violation of Business and Professions Code section 17200 against every major provider of cellular phone services based upon charges for time when the customer was not actually talking, including for time rounded up to the next full minute and for ringing time. The plaintiffs sought restitution of all amounts overpaid and an injunction against these practices. The trial court sustained demurrers without leave to amend on the ground that the plaintiffs' causes of action were preempted by section 332(c)(3)(A). (Ball, at p. 533.) The Court of Appeal upheld the order sustaining the demurrer with respect to the plaintiffs' claims challenging charges for noncommunication time. It reasoned that regulation of "rates" includes not only the rate level but also the method of measuring the length of a call. Since the plaintiffs' claims challenged the reasonableness of the latter rate component and sought restitution of amounts they contended were overpaid, the court concluded their claims were, to that extent, preempted as intruding upon the federally reserved area of rate regulation. (Ball, supra, 81 Cal.App.4th at pp. 535-540.) The court, however, also held section 332(c)(3)(A) did not preempt plaintiffs' state law claims based upon an alleged failure to disclose to the consumer a particular rate or rate practice, because if successful, these claims would only require full and accurate disclosure, and therefore would not intrude upon the setting or assessment of the reasonableness of rates. The court reasoned that claims seeking only full disclosure concerned an issue of consumer protection falling in the category of "other terms and conditions" that Congress intended to allow states to regulate. The court held the plaintiffs should have been granted leave to amend their unfair competition claims to seek injunctive relief based only upon inadequate disclosure of the challenged charges. It therefore reversed the judgment with directions to allow such an amendment. (Ball, supra, 81 Cal.App.4th at pp. 543-544.)