I was surprised to see a case today captioned "People v. J.C. Penney Corp." That's something you typically see in a criminal case, and those filed against corporations are rare. It turns out it's a civil case about false advertising brought by the L.A. City Attorney, against J.C. Penney and a couple of other stores (Kohl's, Macy's and Sears) for asserting alleged "sale" prices that we're accurate -- or at least didn't comply with the California Business & Professions Code. Makes sense.
I was even more surprised when I saw that the trial court sustained the defendants' demurrer on the ground that the statute was unconstitutionally vague.
I was less surprised when the Court of Appeal reversed.
Defendants raise a variety of fancy constitutional challenges; e.g., free speech, due process, etc. But it seems to me that the Court of Appeal gets it right. At least in this particular statute, there's no real vagueness problem with the terms "market price" and the like -- people of reasonable intelligence can understand what that means. So the statute survives at least a facial challenge, which is what's been brought here.
I suspect that the City Attorney is correct that the defendants advertise fake "sale" prices that are in fact deceptive, and don't really -- or at least don't uniformly -- accurately describe what the goods in fact sold for in the recent past. The government can, I think, constitutionally prohibit a store from, say, selling an item for $50, marking it up for 10 seconds to $180, and then reducing the price to $60 and saying "On SALE -- 66% off!" Yeah, at one level, that's "truthful" advertising. But it's deceptive and in the context of commercial speech, subject to regulation.
So, for now, L.A.'s lawsuit continues.
