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Benson v. Kwikset Corporation6/30/2004
Plaintiff James Benson, on behalf of the general public, sued defendants Kwikset Corporation (Kwikset), its parent corporation, Black & Decker Corporation (Black & Decker), plus Technolock, S. A. de C. V. (Technolock) for restitution and injunctive relief under the unfair competition law (Bus. & Prof. Code, § 17200; UCL) and the false advertising law (Bus. & Prof. Code, § 17500; section 17500). He alleged defendants violated statutory provisions prohibiting the marketing or sale of merchandise with "Made in U.S.A" or similar labels when the merchandise either contained foreign-made parts or involved foreign manufacture.
The trial court entered judgment for plaintiff enjoining Kwikset and Black & Decker (collectively defendants) from distributing locksets in California with inaccurate country of origin labels, and also ordered them to notify retailers and distributors they could return mislabeled locksets for either a refund or replacement with properly labeled products. By a postjudgment order, the court awarded plaintiff statutorily authorized costs, plus his attorney fees under Code of Civil Procedure section 1021.5. The court also awarded Technolock its costs.
Both plaintiff and defendants appeal. Defendants challenge the constitutionality and applicability of Business and Professions Code section 17533.7 (section 17533.7) which makes it unlawful "to sell or offer for sale . . . any merchandise on which . . . there appears the words `Made in U.S.A.' . . . or similar words when the merchandise or any article, unit, or part thereof, has been entirely or substantially made, manufactured, or produced outside of the United States." They also attack the trial court's interpretation of Civil Code section 1770, subdivision (a)(4) (section 1770(a)(4)), declaring the use of "deceptive representations . . . of geographic origin in connection with goods and services" as unlawful. Defendants also contend plaintiff failed to present legally adequate extrinsic evidence to establish their labels were likely to mislead the reasonable consumer.
For his part, plaintiff attacks the portions of the judgment declaring the provisions of the Federal Trade Commission Act (15 U.S.C. § 45 et seq.) cannot serve as predicate statutes for a UCL claim, and the extent of the restitutionary relief awarded by the trial court. Plaintiff also appeals from the postjudgment costs order, arguing the trial court erred both in awarding Technolock costs and in denying an award of its own out-of-pocket litigation expenses that were not recoverable as costs.
We reject both parties' claims and affirm the judgment and the postjudgment order.
FACTUAL AND PROCEDURAL BACKGROUND
Kwikset manufactures and sells hardware described as locksets, which can include deadbolts, doorknobs sets, door lever sets, and door handle sets. It has several plants located throughout the United States, plus one in Mexico. Between 1996 and 2000, Kwikset manufactured and sold 35 different varieties of locksets. Plaintiff presented evidence that defendants' attached labels to these products stating "Made in U.S.A.," "All American Made," or similar representations. However, some of these products included screws and pins made in Taiwan, a latch assembly that was sub-assembled at defendants' Mexico plant, or both foreign made parts and assembly.
Plaintiff testified a product label stating "Made in the USA" meant to him "that whatever is in that package should be made - the parts, labor, and the whole component should be made in USA." He purchased Kwikset products " ecause they had a reputation for being . . . quality product , and I was aware they were made in the U
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