Antonio Hinojos v. Kohl's Corporation

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ANTONIO S. HINOJOS, individually No. 11-55793

and on behalf of all others similarly

situated, D.C. No.

Plaintiff-Appellant, 2:10-cv-07590-

ODW-AGR

v.

KOHL’S CORPORATION , a Wisconsin OPINION

corporation; KOHL’S DEPARTMENT

STORES, INC., a Delaware

corporation,

Defendants-Appellees.

Appeal from the United States District Court

for the Central District of California

Otis D. Wright, II, District Judge, Presiding

Argued and Submitted

January 10, 2013—Pasadena, California

Filed May 21, 2013

Before: Stephen Reinhardt, Kim McLane Wardlaw,

and Richard A. Paez, Circuit Judges.

Opinion by Judge Reinhardt;

Concurrence by Judge Wardlaw

2 HINOJOS V . KOHL’S CORP .

SUMMARY*

California Law / Standing

The panel reversed the district court’s dismissal of claims

under California’s Unfair Competition Law, Fair Advertising

Law, and Consumer Legal Remedies Act brought by a

plaintiff in a putative class action against Kohl’s Department

Stores alleging false advertising.

The panel applied the California Supreme Court’s holding

in Kwikset Corp. v. Superior Court, 246 P.3d 877 (Cal. 2011),

and held that when a consumer purchases merchandise on the

basis of false price information, and when the consumer

alleges that he would not have made the purchase but for the

misrepresentation, he has standing to sue under the Unfair

Competition Law and Fair Advertising Law because he has

suffered an economic injury. The panel also reversed the

district court’s dismissal of plaintiff’s Consumer Legal

Remedies Act claims. Finally, the panel denied defendant’s

motion to certify the issues to the California Supreme Court

both on the merits and because of the circumstances attendant

to its filing (where defendant only requested certification for

the first time after oral argument).

Judge Wardlaw concurred in the majority opinion, except

that she concurred only as to the result in Part III, which

denied Kohl’s request to certify the state law standing

requirements for review by the California Supreme Court.

Judge Wardlaw would simply deny the request as untimely.

*

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

HINOJOS V . KOHL’S CORP . 3

COUNSEL

Matthew J. Zevin (argued), Stanley • Iola, LLP, and Derek J.

Emge, Emge & Assoc., San Diego, California, for Plaintiffs-

Appellants.

James F. Speyer (argued), Arnold & Porter LLP, Los

Angeles, California, for Defendants-Appellees.

OPINION

REINHARDT, Circuit Judge:

Most consumers have, at some point, purchased

merchandise that was marketed as being “on sale” because

the proffered discount seemed too good to pass up. Retailers,

well aware of consumers’ susceptibility to a bargain,

therefore have an incentive to lie to their customers by falsely

claiming that their products have previously sold at a far

higher “original” price in order to induce customers to

purchase merchandise at a purportedly marked-down “sale”

price. Because such practices are misleading—and

effective—the California legislature has prohibited them.

The Plaintiff here, Antonio Hinojos, alleges that he was

a victim of such a practice and bought merchandise from a

Kohl’s Department Store that he would not have purchased

had he not been misled by advertisements stating that the

merchandise was marked down from a fictitious “original” or

“regular” price. The only question before us on this appeal is

whether Hinojos alleges that he “lost money or property” and,

therefore, has statutory standing under California law to sue

Kohl’s to enforce California’s prohibition on this deceptive

4 HINOJOS V . KOHL’S CORP .

marketing practice. Kohl’s argues, and the district court

agreed, that Hinojos lost neither money nor property because

he acquired the merchandise he wanted at the price that was

advertised, even if the advertised price was falsely

represented as a “sale.” Because the California Supreme

Court has previously rejected a similar argument, holding that

a consumer has “lost money or property” so long as false

advertisements induced him to buy a product he would not

have purchased or to spend more than he otherwise would

have spent, we reverse. For similar reasons, we also reverse

the district court’s dismissal of Hinojos’s nearly identical

claims under California’s Consumer Legal Remedies Act.

FACTUAL BACKGROUND

Kohl’s Corporation and its wholly owned subsidiary

Kohl’s Department Stores, Inc. (collectively, “Kohl’s” or “the

Defendants”), are retailers that operate a chain of general

department stores selling clothing, footwear, home products

and accessories. Hinojos purchased several items of apparel

and luggage at a Kohl’s department store. Hinojos alleges

that he relied upon deceptive advertisements in deciding to

purchase these items from Kohl’s. Specifically, he alleges

that he purchased several items1 that were advertised as being

substantially reduced from their “original” or “regular” prices

but that were, in reality, routinely sold by Kohl’s at the

1

Specifically, Hinojos purchased Samsonite luggage that was

advertised as 50% off its “original” price of $299.99, Chaps Solid Pique

polo shirts that were marked down 39% from their “original” price of

$36.00, Chaps Solid Pique polo shirts that were marked down 32% from

their “original” price of $39.50, Chaps t-shirts that were marked down

40% from their “original” price of $26.00, and Sonoma Life & Style

Henley Tops that were marked down 40% from their “original” price of

$22.00.

HINOJOS V . KOHL’S CORP . 5

advertised “sale” prices rather than the purported “original”

or “regular” prices. Hinojos further alleges that the

advertised “original” or “regular” prices did not reflect

prevailing retail market prices during the three months

immediately preceding the publication of the advertisements

in question. Finally, Hinojos alleges that he “would not have

purchased [these] products at Kohl’s in the absence of Kohl’s

misrepresentations.”

PROCEDURAL BACKGROUND

Hinojos filed a putative class action complaint in

California Superior Court asserting causes of action under

California’s Unfair Competition Law (UCL), Cal. Bus. &

Prof. Code §§ 17200, et seq.; Fair Advertising Law (FAL),

Cal. Bus. & Prof. Code §§ 17500, et seq.; and Consumer

Legal Remedies Act (CLRA), Cal. Civ. Code §§ 1750, et seq.

Kohl’s removed the action to the federal district court

pursuant to the Class Action Fairness Act, 28 U.S.C.

§1332(d)(2). On December 1, 2010, the district court

dismissed Hinojos’s UCL and FAL claims, determining that

Hinojos did not have standing under the UCL or the FAL,

which require a plaintiff to have “lost money or property” as

a result of the defendant’s false advertising in order bring a

claim, because Hinojos had acquired the merchandise he

wanted at the price advertised.

Shortly thereafter, the California Supreme Court

published its opinion in Kwikset Corp. v. Superior Court,

246 P.3d 877 (Cal. 2011), which held that the purchasers of

goods falsely labeled “made in U.S.A.” had standing under

the UCL and FAL when the purchasers alleged that the false

labeling induced them to purchase the goods and they would

not have purchased them otherwise. Hinojos filed a motion

6 HINOJOS V . KOHL’S CORP .

for reconsideration based on Kwikset, which the district court

denied after concluding that Kwikset applied only to false

advertisements regarding a product’s “composition, effects,

origin, and substance.”

On April 25, 2010, the district court granted the

Defendants’ FRCP 12(c) motion for judgment on the

pleadings and dismissed Hinojos’s only remaining claim, i.e.,

his CLRA claim. The district court concluded that Hinojos

did not have standing under the CLRA because he was unable

to show he suffered “any damage” as a result of Kohl’s false

advertising. Hinojos timely appealed the dismissal of his

UCL, FAL, and CLRA claims.

JURISDICTION AND STANDARD OF REVIEW

The district court had jurisdiction over this putative class

action under 28 U.S.C. § 1332(d)(2) because Hinojos is a

citizen of California, the Defendants are citizens of another

state and the amount in controversy exceeds $5,000,000. We

have jurisdiction under 28 U.S.C. § 1291.

We review de novo the district court’s dismissal of

Hinojos’s claims. See Berg v. Popham, 412 F.3d 1122, 1125

(9th Cir. 2005) (holding that a district court’s grant of both

FRCP 12(b) and 12(c) motions are reviewed de novo). As a

federal court sitting in diversity, we “must apply the

substantive law of California, as interpreted by the California

Supreme Court,” Karen Kane Inc. v. Reliance Ins. Co.,

202 F.3d 1180, 1183 (9th Cir. 2000), even if that law changes

after judgment is entered below. See Nelson v. Brunswick

Corp., 503 F.2d 376, 381 (9th Cir. 1974).

HINOJOS V . KOHL’S CORP . 7

ANALYSIS

I

The UCL is a broad California statute that prohibits

business practices that constitute “unfair competition,” which

is defined as

any unlawful, unfair or fraudulent business act

or practice and unfair, deceptive, untrue or

misleading advertising and any act prohibited

by Chapter 1 (commencing with Section

17500) of Part 3 of Division 7 of the Business

and Professions Code.

Cal. Bus. & Prof. Code § 17200. The UCL expressly

incorporates the FAL’s prohibition on unfair advertising as

one form of unfair competition. The FAL, in turn, provides

in relevant part:

No price shall be advertised as a former price

of any advertised thing, unless the alleged

former price was the prevailing market price

. . . within three months next immediately

preceding the publication of the advertisement

or unless the date when the alleged former

price did prevail is clearly, exactly and

conspicuously stated in the advertisement.

Cal. Bus. & Prof. Code § 17501. Thus, the FAL expressly

prohibits the type of false advertising that Kohl’s allegedly

8 HINOJOS V . KOHL’S CORP .

engaged in and the UCL provides individual consumers with

a cause of action to enforce that prohibition.2

In 2004, however, the voters of California passed

Proposition 64, which restricts standing for individuals

alleging UCL and FAL claims to persons who “ha[ve]

suffered injury in fact and ha[ve] lost money or property as a

result of the unfair competition.” Cal. Bus. & Prof. Code

§§ 17204 (UCL), 17535 (materially identical standard under

the FAL); see Kwikset, 246 P.3d at 884 (holding that the UCL

and FAL standing requirements are identical). The California

Supreme Court has held that the purpose of Proposition 64

was to “curtail the prior practice of filing suits on behalf of

clients who have not used the defendant’s product or service,

viewed the defendant’s advertising, or had any other business

dealings with the defendant.” Clayworth v. Pfizer, Inc.,

233 P.3d 1066, 1086–87 (Cal. 2010) (internal quotation

marks omitted). However, Proposition 64 “just as plainly

preserved standing for those who had had business dealings

with a defendant and had lost money or property as a result of

the defendant’s unfair business practices.” Id. at 1087.

The “lost money or property” requirement therefore

requires a plaintiff to demonstrate “some form of economic

injury” as a result of his transactions with the defendant,

Kwikset, 246 P.3d at 885, although “the quantum of lost

money or property necessary to show standing is only so

2

The UCL is designed to function this way. It “borrows violations

from other laws by making them independently actionable as unfair

competitive practices” although “a practice may be deemed unfair even if

not specifically proscribed by some other law.” Korea Supply Co. v.

Lockheed Martin Corp., 63 P.3d 937, 943 (Cal. 2003) (quotation marks

and citations omitted).

HINOJOS V . KOHL’S CORP . 9

much as would suffice to establish [Article III] injury in fact,”

id. at 886.3 There are “innumerable ways” that a consumer

can show economic injury from unfair competition.4 Id. at

885.

The Kwikset Court explained precisely what a plaintiff

must allege when he wishes to satisfy the economic injury

requirement in a case involving false advertising: “[a]

consumer who relies on a product label and challenges a

misrepresentation contained therein can satisfy the standing

requirement of section 17204 by alleging . . . that he or she

would not have bought the product but for the

misrepresentation.” Id. at 890. Kwikset also explained why

such allegations are sufficient to establish economic injury

within the meaning of Proposition 64:

From the original purchasing decision we

know the consumer valued the product as

3

There is no difficulty in this case regarding Article III injury in fact,

and neither party suggests otherwise. W e have explained that when, as

here, “Plaintiffs contend that class members paid more for [a product] than

they otherwise would have paid, or bought it when they otherwise would

not have done so” they have suffered an Article III injury in fact. Mazza

v. Am. Honda Motor Co., 666 F.3d 581, 595 (9th Cir. 2012). The only

issue before us, therefore, is whether this “injury in fact” is an economic

injury sufficient for purposes of statutory standing under the UCL and

FAL.

4

At the pleading stage, of course, allegations of economic injury

suffice. Id. at 888–89 (citing Lujan v. Defenders of Wildlife, 504 U.S.

555, 561(1992)).

10 HINOJOS V . KOHL’S CORP .

labeled more than the money he or she parted

with; from the complaint’s allegations we

know the consumer valued the money he or

she parted with more than the product as it

actually is; and from the combination we

know that because of the misrepresentation

the consumer (allegedly) was made to part

with more money than he or she otherwise

would have been willing to expend, i.e., that

the consumer paid more than he or she

actually valued the product. That increment,

the extra money paid, is economic injury and

affords the consumer standing to sue.[5]

Id. at 890–91.

Hinojos has done everything Kwikset requires to allege an

economic injury under the UCL and FAL. He alleges that the

advertised discounts conveyed false information about the

goods he purchased, i.e., that the goods he purchased sold at

a substantially higher price at Kohl’s in the recent past and/or

in the prevailing market. He also alleges that he would not

have purchased the goods in question absent this

misrepresentation. This is sufficient under Kwikset.

Kohl’s attempts to distinguish Kwikset on the ground that

Hinojos’s complaint does not state at what price (if any) he

5

Pleading that one would not have otherwise purchased the product but

for the misleading advertising also satisfies the consumer’s obligation to

plead a causal link between the advertising and the alleged economic

injury. Id. at 890. Therefore, as a practical matter, in cases such as these,

Proposition 64’s causation requirement (which is not at issue in this

appeal) and the economic injury requirement are coextensive.

HINOJOS V . KOHL’S CORP . 11

would have purchased the merchandise in question had its

“original” or “regular” price not been misrepresented. There

is no requirement, however, that Hinojos separately plead

how much he would have paid for the merchandise had he

known its true market value. Kwikset explicitly rejected that

argument. Id. at 891 n.15 (“Because the issue here is only the

threshold matter of standing, not whether and how much to

award in restitution, a specific measure of the amount of [the

alleged] loss is not required.”); see id. at 894–95.6

In denying Hinojos’s motion for reconsideration, the

district court limited Kwikset on the alternative ground that it

addresses UCL and FAL standing only in cases involving

“factual misrepresentations about the composition, effects,

origin, and substance of advertised products.” Kohl’s

advances a similar argument in slightly different form when

it argues that Kwikset does not apply because there was “no

difference in value between the product ‘as labeled’ and the

product ‘as it actually is,’ because the products . . . are one

and the same.” In other words, according to Kohl’s and the

6

W e note, however, that Kwikset explained that the difference between

what a plaintiff actually paid and what he would have paid had the product

been truthfully advertised represents the appropriate measure of restitution

to which Hinojos may be entitled under the UCL. Id. Therefore, even

though it need not be pled in order to afford him standing, the price that

Hinojos would have otherwise paid, if any, will certainly be relevant to the

calculation of restitution, assuming Hinojos is able to prove his false

advertising allegations. See Korea Supply Co., 63 P.3d at 946–47

(reiterating that disgorgement is only available under the UCL for

damages actually suffered by the plaintiff). In any event, Hinojos need

not be able to prove the quantum of damages he suffered in order to be

entitled to injunctive relief given that he alleges sufficient facts to prove

that he suffered some economic injury. See Kwikset, 246 P.3d at 894–95

(noting that a UCL plaintiff may obtain an injunction even when he cannot

prove his entitlement to restitution).

12 HINOJOS V . KOHL’S CORP .

district court, when a merchant misrepresents the “regular”

price of his wares, it does not misrepresent the innate value of

those wares so the misled consumer has suffered no economic

injury; he gets the product he expected at the price he

expected.

Kwikset cannot be so easily limited. It is true that Kwikset

itself involved misrepresentations regarding how the

merchandise in question was produced; the defendant in

Kwikset was a manufacturer of locksets, which it falsely

labeled as having been “Made in [the] U.S.A.” It is also true

that Kwikset described a number of other examples of

misrepresentations concerning a product’s origin or

composition that would be actionable under the UCL and

FAL: meat falsely labeled as kosher or halal, wine labeled

with the wrong region or year, blood diamonds mislabeled as

conflict-free, and goods falsely suggesting they were

produced by union labor. Kwikset, 216 P.3d at 889–90.

Nothing in Kwikset, however, suggests that these examples

were intended to be exhaustive instead of illustrative. To the

contrary, these examples were offered to explain why the

particular misrepresentation at issue in Kwikset, which did

involve how the product was manufactured, was significant.

That is why they were introduced in a paragraph beginning

with the sentence: “To some consumers, processes and places

of origin matter.” Id. at 889.

The district court’s “composition, effects, origin, and

substance” test ignores the fact that, to other consumers, a

product’s “regular” or “original” price matters; it provides

important information about the product’s worth and the

prestige that ownership of that product conveys. See Dhruv

Grewal & Larry D. Compeau, Comparative Price

Advertising: Informative or Deceptive?, 11 J. of Pub. Pol’y &

HINOJOS V . KOHL’S CORP . 13

Mktg. 52, 55 (Spring 1992) (“By creating an impression of

savings, the presence of a higher reference price enhances

subjects’ perceived value and willingness to buy the

product.”); id. at 56 (“[E]mpirical studies indicate that as

discount size increases, consumers’ perceptions of value and

their willingness to buy the product increase, while their

intention to search for a lower price decreases.”).7

Misinformation about a product’s “normal” price is,

therefore, significant to many consumers in the same way as

a false product label would be. See Kwikset, 246 P.3d at 890

(recognizing that falsely labeling a watch as a Rolex would be

an actionable misrepresentation even if the watch was a

“functional[] equivalent” of a Rolex). That, of course, is why

retailers like Kohl’s have an incentive to advertise false

“sales.” It is also why the California legislature has

prohibited them from doing so. In fact, the deceived bargain

hunter suffers a more obvious economic injury as a result of

false advertising than the Kwikset consumer who was duped

into buying foreign-made goods, because the bargain hunter’s

expectations about the product he just purchased is precisely

that it has a higher perceived value and therefore has a higher

resale value.

The district court’s test would also eliminate consumers’

ability to bring UCL and FAL claims for a vast array of other

7

W e see no merit to the Defendants’ objection that we may not rely on

articles from a marketing journal at the motion to dismiss stage. W e do

not rely on the cited article to establish facts about Hinojos’s case that are

not contained in the pleadings, but rather in support of the conclusion that

false advertisements about a product’s true market price are significant to

consumers. See Rubio v. Capital One Bank, 613 F.3d 1195, 1200–01 (9th

Cir. 2010) (referring, at the motion to dismiss stage, to published empirical

research about consumer behavior to determine whether an advertisement

was potentially misleading).

14 HINOJOS V . KOHL’S CORP .

misleading marketing practices that have little or nothing to

do with a product’s “composition, effects, origin, and

substance.” For example, none of the following

advertisements deal with the “composition, effect, origin, and

substance” of the product: “not available in stores,”

“available for a limited time only,” “the same model of shoe

worn by LeBron James,” “50% of customers who purchased

product X also purchased our product,” and “more doctors

recommend our product than any other brand.” Yet all of

these examples represent effective marketing techniques that,

if false, can be used to deceive consumers into making

purchases they would not otherwise make. Kwikset gives no

indication that Proposition 64 meant to silently close the door

on consumers’ ability to bring UCL and FAL claims based on

such false advertising.

To the contrary, Kwikset emphasized that Proposition 64

was enacted not to eliminate individual consumer suits when

the consumer was actually deceived by a misleading

advertisement, but rather to stop “fishing expeditions” by

consumers and attorneys who may have never even intended

to purchase a product that was being falsely advertised.

Kwikset, 246 P.3d at 884; see also id. at 894. If Proposition

64 were interpreted to require more than that a consumer have

purchased a product that he would not have purchased absent

the misleading advertisement, then it “would bring to an end

private consumer enforcement of bans on many label

misrepresentations, contrary to [its] apparent intent . . . .” Id.

at 891. This is precisely what would happen to private

consumer enforcement of California’s prohibition on

advertising false “sales,” Cal. Bus. & Prof. Code § 17501,

under the district court’s approach.

HINOJOS V . KOHL’S CORP . 15

The district court alternatively described its holding as

stemming from the fact that Hinojos got the “benefit of the

bargain” because he kept the goods that he purchased and

they were not defective. This “benefit of the bargain”

rationale was explicitly rejected in Kwikset. 246 P.3d at

892–93. Kwikset held that the “benefit of the bargain”

defense is permissible only if the misrepresentation that the

consumer alleges was not “material.” A representation is

“material,” however, if a reasonable consumer would attach

importance to it or if “the maker of the representation knows

or has reason to know that its recipient regards or is likely to

regard the matter as important in determining his choice of

action.”8 Id. at 892 (quoting Restatement (Second) of Torts,

§ 538, subd. (2)(b) (1977)). Moreover, the legislature’s

decision to prohibit a particular misleading advertising

practice is evidence that the legislature has deemed that the

practice constitutes a “material” misrepresentation, and courts

must defer to that determination. See id. Here, Hinojos

specifically and plausibly alleges that Kohl’s falsely markets

its products at reduced prices precisely because consumers

such as himself reasonably regard price reductions as material

information when making purchasing decisions.

Furthermore, both state and federal law specifically prohibit

retailers from advertising false “sales.” See Cal. Bus. & Prof.

Code § 17501 (FAL); Cal. Civil Code § 1770(a)(13) (CLRA);

16 C.F.R. § 233.1(a) (Federal Trade Commission

regulations). Therefore, the district court’s determination that

Hinojos has suffered no economic injury because he received

the “benefit of the bargain” is contrary to Kwikset because

8

Furthermore, the materiality of a misrepresentation is typically an

issue of fact, and therefore should not be decided at the motion to dismiss

stage. See In re Steroid Hormone Product Cases, 104 Cal. Rptr. 3d 329,

338–39 (Cal. Ct. App. 2010).

16 HINOJOS V . KOHL’S CORP .

Hinojos alleges that Kohl’s made material misrepresentations

that induced him to buy products he would not otherwise

have purchased.

In sum, price advertisements matter. Applying Kwikset

in a straightforward manner, we hold that when a consumer

purchases merchandise on the basis of false price

information, and when the consumer alleges that he would

not have made the purchase but for the misrepresentation, he

has standing to sue under the UCL and FAL because he has

suffered an economic injury.

II

The CLRA provides a second, overlapping prohibition on

advertising non-existent sales. Specifically, it forbids

“[m]aking false or misleading statements of fact concerning

reasons for, existence of, or amounts of price reductions.”

Cal. Civil Code § 1770(a)(13). In turn, Cal. Civil Code

§ 1780(a) provides a cause of action to “[a]ny consumer who

suffers any damage as a result of the use or employment by

any person of a method, act, or practice declared to be

unlawful by Section 1770.” Cal. Civil Code § 1780(a)

(emphasis added). The district court’s conclusion that

Hinojos failed to establish standing under the CLRA because

he did not suffer “any damage” is erroneous for the same

reasons that its determinations regarding UCL and FAL

standing were wrong.

In Meyer v. Sprint Spectrum L.P., 200 P.3d 295, 299,

302–03 (Cal. 2009), the California Supreme Court made clear

that the CLRA’s “any damage” requirement is a capacious

one that includes any pecuniary damage as well as

opportunity costs and transaction costs that result when a

HINOJOS V . KOHL’S CORP . 17

consumer is misled by deceptive marketing practices.

Because the “any damage” standard includes even minor

pecuniary damage, we conclude that any plaintiff who has

standing under the UCL’s and FAL’s “lost money or

property” requirement will, a fortiori, have suffered “any

damage” for purposes of establishing CLRA standing. See,

e.g., Klein v. Chevron U.S.A., Inc., 137 Cal. Rptr. 3d 293, 320

(Cal. Ct. App. 2012) (noting that where a plaintiff alleged an

“economic injury” under the UCL he also adequately alleged

injury under the CLRA); Mlejnecky v. Olympus Imaging Am.

Inc., 2011 WL 1497096, at *4 (E.D. Cal. 2011) (unpublished)

(same). Accordingly, Hinojos adequately alleges that he

suffered “any damage” for purposes of the CLRA. We

therefore reverse and hold that Hinojos adequately alleges an

injury under the CLRA.

III

Finally, because Kwikset provides more than sufficient

guidance with regard to the state-law statutory standing

questions presented in this case, we deny the Defendants’

motion to certify this matter to the California Supreme Court.

Although we deny the motion on its merits, an additional

comment is required in light of the circumstances under

which the motion was made.

Kohl’s removed this lawsuit to federal court, denying

Hinojos the state forum in which he sought to have his case

heard. Although Kwikset was discussed extensively in the

parties’ appellate briefs, Kohl’s did not suggest that

certification was necessary, or appropriate, either in its

answering brief or at oral argument. More important, any

objective witness to the oral argument would have concluded

that the chances that Kohl’s would prevail on the merits were

18 HINOJOS V . KOHL’S CORP .

slim at best. Then, a month and a day after oral argument,

Kohl’s filed a motion to certify, suggesting for the first time

that certification would be appropriate and strongly urging

that we certify this case to the California Supreme Court

rather than decide it. The motion to certify did not rely on

any intervening authority or on any case decided after Kohl’s

filed its appellate brief, nor did it make any new substantive

arguments. Furthermore, Kohl’s offered no reason for failing

to mention certification prior to or during oral argument or

for urging certification only after we expressed profound

skepticism at oral argument regarding the merits of its

position.

We have long looked with disfavor upon motions to

certify that are filed after the moving party has failed to avail

itself of a prior opportunity to seek certification. See, e.g.,

Thompson v. Paul, 547 F.3d 1055, 1065 (9th Cir. 2008). For

example, in states that accept certification from federal

district courts (unlike California), we have a held that there is

a “presumption against certifying a question to a state

supreme court after the federal district court has issued a

decision” when the party that lost below did not mention the

possibility of certification until after the district court entered

summary judgment against it. Such requests for certification

are generally inappropriate, we have held, because “[a] party

should not be allowed ‘a second chance at victory’ through

certification.” Id. (quoting In re Complaint of McLinn,

744 F.2d 677, 681 (9th Cir. 1984)).

Here, Kohl’s had an opportunity to suggest certification

in its pre-argument brief or even at oral argument. It could

have urged that, in the event that this court was not persuaded

that California law clearly favored its position, the

appropriate course of action would be certification to the

HINOJOS V . KOHL’S CORP . 19

California Supreme Court. Yet it chose at that point not to

urge certification as an alternate course of action, presumably

for tactical reasons—possibly because having prevailed

below it greatly preferred to have the case decided by a

federal court. Only after (correctly) perceiving at oral

argument that we were not inclined to rule in its favor on the

merits did Kohl’s file its motion for certification. For reasons

similar to those expressed in Thompson, we strongly disfavor

a party that prevailed below requesting certification for the

first time after it becomes apparent at oral argument that it is

not likely to prevail in federal court.

Our court has also developed rules to ensure that a party

may not manipulate the appellate system by seeking to avoid

a panel it views as unlikely to accept its legal position. It is

for that reason that we do not make panels public until the

first working day of the week preceding oral argument and

permit motions for continuances after the panel has been

announced only “under exceptional circumstances.” See

General Order 3.5. Here, Kohl’s urged certification for the

first time only after it had the opportunity both to learn which

members of this court would hear its appeal and to assess

those judges’ actual views of its case, based upon the

concerns the judges expressed at oral argument. Having

gained that knowledge, Kohl’s sought to send this case back

to state court whence it came, in light of its perception that

the federal court was unlikely to rule in its favor. Kohl’s

conduct regarding certification violated both our rule against

belated certification requests and our long-standing

prohibition against a party’s use of procedural motions to

avoid having its appeal decided by a panel it perceives as

unfavorable. Moreover, here Kohl’s request would not only

affect the operation of the federal court, but would

20 HINOJOS V . KOHL’S CORP .

unnecessarily embroil the Supreme Court of the State of

California in Kohl’s attempt to find a more favorable forum.

CONCLUSION

In Kwikset, the California Supreme Court held that all a

consumer need allege to establish standing to bring a UCL or

FAL claim is that (1) the defendant made a false

representation about a product, (2) the consumer purchased

the product in reliance on the misrepresentation, and (3) he

would not have purchased the product otherwise. We reject

the Defendants’ argument that Kwikset is distinguishable

because it involved a different type of unlawful

misrepresentation than the one at issue here. We therefore

reverse the district court’s dismissal of Hinojos’s UCL and

FAL claims. For nearly identical reasons, we also reverse the

district court’s dismissal of Hinojos’s CLRA claims. We also

deny the Defendant’s motion to certify both on the merits and

because of the circumstances attendant to its filing.

REVERSED and REMANDED; Motion to Certify

DENIED.

WARDLAW, Circuit Judge, concurring in part and

concurring in the result:

I am pleased to concur in the majority opinion, except that

I concur only as to the result of Part III, which denies Kohl’s’

request to certify the state law standing requirements for

review by the California Supreme Court. Although I agree

that Kohl’s’ first removing the action from state to federal

court, and then seeking to have the matter on appeal certified

HINOJOS V . KOHL’S CORP . 21

to the state court, raises suspicion as to Kohl’s’ motivations,

on this record and without providing an opportunity to Kohl’s

to respond, it is somewhat unfair to conclude that Kohl’s had

only a nefarious motive. I would simply deny the request as

untimely.