G.H.I.I. v. MTS, Inc

In G.H.I.I. v. MTS, Inc. (1983) 147 Cal. App. 3d 256, the plaintiff was a record retailer that alleged three other record retailers (defendants Record Factory, Integrity, and Tower) used their market power to coerce record wholesalers to grant price discounts to defendants but not to their competitors, a so-called vertical boycott. ( Id. at pp. 267-269.) The court held that the complaint stated a claim against Tower because it alleged Tower used threats, coercion, intimidation and boycott in furtherance of its goal of forcing wholesalers to boycott plaintiff; however, the complaint did not state a claim against Record Factory or Integrity because no acts by them were alleged that furthered the coercion. ( Id. at p. 269.) The Court rejected as specious the defendants' argument that plaintiffs "failed to plead that the 'secret rebates' were 'not extended to all purchasers purchasing upon like terms and conditions' ... as section 17045 requires." (Id. at p. 272.) The court observed the gravamen of plaintiffs' complaint was that they purchased on like terms and conditions, but were treated differently by distributors. Again, the court merely responded to an argument, and did not address the question whether "like terms and conditions" modifies the rebate clause. Moreover, the court pointed out that the plaintiffs alleged the existence of both secret prices and discounts and "financing arrangements and other special terms and services specified in the complaint which were not granted to" plaintiffs (id. at p. 264), thus implicating both clauses of the statute. The Court analyzed whether Code of Civil Procedure section 340 applied in the context of a statutory scheme that, like Business and Professions Code section 17529.5, contains independent provisions for recovery of actual damages and statutory damages. The plaintiff in G.H.I.I. asserted violations of the Unfair Practices Act ( 17000 et seq.), which provides for the award of actual damages in one section ( 17070), and treble damages in another section ( 17082). Both forms of recovery are required "if a violation of the act is established." (G.H.I.I., supra, 147 Cal.App.3d at p. 277.) In other words, the act does not require a plaintiff to make any additional showing to obtain treble damages; such damages attach upon establishing a statutory violation. The appellant argued that, under the statutory scheme, a "two-fold statute of limitations" applied: "the one-year period in Code of Civil Procedure section 340 to the claim for treble damages, and the three-year period in Code Civil of Procedure section 338 to the recovery of actual damages." (G.H.I.I., supra, 147 Cal.App.3d at p. 278.) The court agreed, concluding that different statute of limitations may apply where the plaintiff seeks "actual and treble damages ... based upon separate statutes contained within the same act." (Id. at p. 278.) The court further concluded that, for the purposes of the Unfair Practices Act, a different statute of limitations did apply to recovery of actual damages versus recovery of treble damages: "Appellants claim compensatory damages pursuant to section 17070, and request trebling of those damages in accordance with section 17082. Since these claims are patently severable, and the actual damages are not in the nature of a 'penalty or forfeiture,' we conclude that appellants are entitled to recover all actual damages which accrued within three years of the filing of the complaint, and that all of such damages which accrued within one year prior to the filing of the complaint may be trebled under section 17082." (147 Cal.App.3d at p. 279.)