California Civil Jury Instructions (CACI) (2017)

3300. Locality Discrimination - Essential Factual Elements

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3300.Locality Discrimination—Essential Factual Elements
[Name of plaintiff] claims that [name of defendant] engaged in unlawful
locality discrimination. To establish this claim, [name of plaintiff] must
prove all of the following:
1. That [name of defendant] [offered to sell/sold/furnished] [product/
service] at a lower price in one [location/section/community/city]
in California than in another [location/section/community/city] in
California;
2. That [name of defendant] intended to destroy competition from an
established dealer [or to prevent competition from any person
who in good faith intended and attempted to become such a
dealer];
3. That [name of plaintiff] was harmed; and
4. That [name of defendant]’s conduct was a substantial factor in
causing [name of plaintiff]’s harm.
New September 2003
Directions for Use
The word “price” as used here should be read sufficiently broadly to include
“special rebates, collateral contracts, or any device of any nature whereby such
discrimination is in substance or fact effected.” (Bus. & Prof. Code, § 17049.) To
the extent the circumstances of the case warrant it, the word “price” in the
instruction may be supplemented or supplanted by other price-related terms.
Business and Professions Code sections 17071 and 17071.5 create rebuttable
presumptions regarding the purpose or intent to injure competitors or destroy
competition. The Supreme Court has observed: “The obvious and only effect of this
provision is to require the defendants to go forward with such proof as would bring
them within one of the exceptions or which would negative the prima facie
showing of wrongful intent.” (People v. Pay Less Drug Store (1944) 25 Cal.2d 108,
114 [153 P.2d 9].)
Sources and Authority
• “Locality Discrimination” Defined. Business and Professions Code section
17031.
• Locality Discrimination Prohibited. Business and Professions Code section
17040.
• “Article or Product” Defined. Business and Professions Code section 17024.
• Actual Damages or Injury Not Required. Business and Professions Code section
17082.
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• “The purpose of the Unfair Practices Act (UPA) is ‘to safeguard the public
against the creation or perpetuation of monopolies and to foster and encourage
competition, by prohibiting unfair, dishonest, deceptive, destructive, fraudulent
and discriminatory practices by which fair and honest competition is destroyed
or prevented.’ It forbids most locality discriminations, the use of loss leaders,
gifts, secret rebates, boycotts, and ‘deceptive, untrue or misleading advertising.’
It also prohibits the sale of goods and services below cost.” (Pan Asia Venture
Capital Corp. v. Hearst Corp. (1999) 74 Cal.App.4th 424, 431–432 [88
Cal.Rptr.2d 118], internal citations omitted.)
• “Sections 17031 and 17040 are tailored to address the problem of a distributor,
typically a retailer, selling out of many locations, who might use geographical
price discrimination as a predatory practice against its own competitors.” (ABC
International Traders, Inc. v. Matsushita Electric Corp. of America (1997) 14
Cal.4th 1247, 1266 [61 Cal.Rptr.2d 112, 931 P.2d 290].)
• “As section 17031 is presently worded, we conclude that the smallest
geographic unit it envisages is the individual store or outlet, not the individual
purchaser regardless of location.” (Harris v. Capitol Records Distributing Corp.
(1966) 64 Cal.2d 454, 460 [50 Cal.Rptr. 539, 413 P.2d 139].)
• “[T]o fall within [the] prohibition a seller must have at least two different
places of business and must sell at a lower price in one than in the other.”
(Harris, supra, 64 Cal.2d at p. 460.)
• “While, similar to other cases, damages cannot be awarded in antitrust cases
upon sheer guesswork or speculation, the plaintiff seeking damages for loss of
profits is required to establish only with reasonable probability the existence of
some causal connection between defendant’s wrongful act and some loss of the
anticipated revenue. Once that has been accomplished, the jury will be
permitted to act upon probable and inferential proof and to ‘make a just and
reasonable estimate of the damage based on relevant data, and render its verdict
accordingly.’ ” (Suburban Mobile Homes, Inc. v. AMFAC Communities, Inc.
(1980) 101 Cal.App.3d 532, 545 [161 Cal.Rptr. 811], internal citations omitted.)
• The federal law most comparable to the Unfair Practices Act is the Robinson-
Patman Act (15 U.S.C. § 13 et seq.); that act differs substantially from the
Unfair Practices Act, however. For a discussion of this subject, see Turnbull &
Turnbull v. ARA Transportation (1990) 219 Cal.App.3d 811 [268 Cal.Rptr. 856].
One notable difference is that the Robinson-Patman Act requires at least two
actual sales. Thus, mere offers to sell cannot violate that act.
Secondary Sources
1 Witkin, Summary of California Law (10th ed. 2005) Contracts, §§ 609–615
3Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts,
§ 40.153 (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition,
§ 565.52 (Matthew Bender)
23 California Points and Authorities, Ch. 235, Unfair Competition, § 235.22
UNFAIR PRACTICES ACT CACI No. 3300
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(Matthew Bender)
1 Matthew Bender Practice Guide: California Unfair Competition and Business
Torts, Ch. 5, Antitrust, 5.44, 5.46[2], 5.47[1]
CACI No. 3300 UNFAIR PRACTICES ACT
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