California Civil Jury Instructions (CACI) (2017)

3331. Affirmative Defense to Locality Discrimination, Below Cost Sales, and Loss Leader Sales Claims - Closed-out, Discontinued, Damaged, or Perishable Items

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3331.Affirmative Defense to Locality Discrimination, Below Cost
Sales, and Loss Leader Sales Claims—Closed-out, Discontinued,
Damaged, or Perishable Items
[Name of defendant] claims that any [locality discrimination/below cost
sales/loss leader sales] proven by [name of plaintiff] [is/are] within the
law because the [product] was being sold as [a close-out/seasonal goods/
damaged goods/perishable goods]. To succeed, [name of defendant] must
prove both of the following:
1. That [his/her/its] sales were [insert one or more of the following:]
1. [in the course of closing out, in good faith, all or any part of [his/
her/its] supply of [product], in order to stop trade in [product];]
1. [of seasonal goods to prevent loss by depreciation;] [or]
1. [of perishable goods to prevent loss by spoilage or depreciation;]
1. [of goods that were damaged or deteriorated in quality;] and
2. That [name of defendant] gave sufficient notice of the sale to the
Notice is sufficient only if:
1. The sale goods are kept separate from other goods;
2. The sale goods are clearly marked with the reason[s] for the
sales; and
3. Any advertisement of such goods sets forth the reason[s] for the
sale and indicates the number of items to be sold.
New September 2003
Directions for Use
This defense applies to locality discrimination, below cost sales, and loss leader
sales only.
Sources and Authority
• Exceptions for Close-out, Discontinued, Damaged, or Perishable Items. Business
and Professions Code section 17050.
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,
§ 565.53 (Matthew Bender)
23 California Points and Authorities, Ch. 235, Unfair Competition, § 235.20
(Matthew Bender)
1 Matthew Bender Practice Guide: California Unfair Competition and Business
Torts, Ch. 5, Antitrust, 5.100[3]