PACIFIC GAS & ELECTRIC CO., Plaintiff and Appellant, v. COUNTY OF STANISLAUS et al., Defendants and Respondents.
Appellant Pacific Gas and Electric Company is defendant in an antitrust class action pending in federal court. Respondent County of Stanislaus (the county) is a named plaintiff in that class action. The present case involves appellant's attempt pursuant to Code of Civil Procedure section 526a to prohibit respondents from expending any funds to prosecute the federal court action. The trial court sustained respondents' demurrer to appellant's complaint without leave to amend. We affirm.
Facts and Procedural History
On December 3, 1993, the county and a residential customer of appellant filed a class action complaint in the United States District Court, Eastern District of California. The complaint alleged violations of various federal statutes 1 and the California Cartwright and Unfair Practices Acts.2 The complaint challenges the mechanism by which appellant contracts for the purchase of Canadian natural gas.
In response, appellant filed its state court complaint for injunctive and declaratory relief on February 9, 1994. That complaint, filed pursuant to Code of Civil Procedure section 526a,3 named as defendants the county, its board of supervisors, and each county supervisor individually (collectively, respondents). The complaint alleges that Business and Professions Code section 16750 4 only permits the county to sue concerning acts which occurred or have their effects primarily within the county. The complaint further alleges the county usurped the sovereignty of the class-member counties by prosecuting an action on their behalf. Respondents demurred to the complaint.
The trial court heard the demurrer on March 24, 1994. By written order filed May 3, 1994, the court sustained the demurrer without leave to amend. Judgment was entered on May 11, 1994. Appellant filed its notice of appeal on June 9, 1994.
Appellant contends that section 16750, in net effect, permits the county to file a multi-county class action antitrust suit only if the county is represented by the Attorney General. Respondents contend section 16750 does not limit a county's right to proceed with a class action through counsel of its own choosing.5
We will begin by setting out the historical development of section 16750 and related sections; we will then discuss the meaning of section 16750. We will conclude that respondents' interpretation of section 16750 is correct: there is no requirement that the county's class action be prosecuted by the Attorney General.
A. The Statutory Background.
The Cartwright Act was enacted in 1907. (Stats.1907, ch. 530.) The initial statutory authority for a civil damages action was enacted in 1941. (Stats.1941, ch. 526, § 1.) The current statutory authorization for treble damages was enacted in 1959. (Stats.1959, ch. 2078, § 1.) As amended in that year, section 16750 provided, in relevant part:
“Any person who is injured in his business or property by reason of anything forbidden or declared unlawful by this chapter, may sue therefor in any court having jurisdiction in the county where the defendant resides or is found, or any agent resides or is found, or where service may be obtained, without respect to the amount in controversy, and to recover three times the damages sustained by him, and shall be awarded a reasonable attorneys' fee together with the costs of the suit․”
In 1961, the foregoing section was renumbered as subdivision (a) and subdivisions (b) and (c) were added to section 16750, as follows (Stats.1961, ch. 1023, § 1):
“(b) The state and any of its political subdivisions and public agencies shall be deemed a person within the meaning of this section.
“(c) The Attorney General may bring an action on behalf of the state or of any of its political subdivisions or public agencies to recover the damages provided for by this section, or by any comparable provision of federal law, provided that the Attorney General shall notify in writing any political subdivision or public agency of his intention to bring any such action on its behalf, and at any time within 30 days thereafter, such political subdivision or public agency may, by formal resolution of its governing body or as otherwise specifically provided by applicable law, withdraw the authority of the Attorney General to bring the intended action․”
In addition to the codified sections of chapter 1023, Statutes of 1961, section 2 of the statute provided:
“Subdivision (b) is added to this section [section 16750] for the purpose of clarification only and is not to be construed or interpreted as an indication that the State or any of its political subdivisions or public agencies is not a person within the meaning of Section 16750 as originally enacted in Chapter 530 of the Statutes of 1907 and as subsequently amended. The Legislature hereby further declares that at the time of the original enactment of Section 16750, and at all times since, it intended that the State, its political subdivisions and public agencies be included within the meaning of the word ‘person.’ ”
Also in 1961, the Legislature repealed and replaced section 16754. (Stats.1961, ch. 757, § 1.) That section previously authorized the Attorney General and the district attorney to initiate forfeiture actions for violations of the Cartwright Act. (Stats.1941, ch. 526, § 1.) The 1961 revision provided:
“The Attorney General, or the district attorney of any county, on the order of the Attorney General, shall initiate civil actions or criminal proceedings for violation of this chapter. Civil actions and criminal proceedings for violation of this chapter initiated by the Attorney General or or on his order may be brought in the superior court in and for any county where the offense or any part thereof is committed or where any of the offenders reside or where any corporate defendant does business.”
From 1961 until 1977, there were amendments to section 16750, but the above-quoted subdivisions were essentially unchanged. One 1972 amendment bears mention, however. Chapter 1140, section 1, Statutes of 1972, added subdivision (d) to section 16750, as follows:
“(d) In any antitrust action brought on behalf of the state in which the Attorney General is the class representative of political subdivisions, public agencies, or citizens of the state who have been affected by the matters set forth in the complaint, the state shall retain for deposit in the Attorney General antitrust account within the General Fund, the proceeds, if any, of any attorneys' fees awarded by the court in which such case is located, to the Attorney General, resulting from such class representation.”
In 1977, there were further amendments to section 16750, although the previously quoted subsections remained unchanged. (See Stats.1977, ch. 540, § 1.) Among the 1977 amendments were the following additions to section 16750:
“(g) The district attorney of any county may prosecute any action on behalf of such county or any city or public agency or political subdivision located wholly within such county which the Attorney General is authorized to bring pursuant to subdivision (c) of this section, whenever it appears that the activities giving rise to such prosecution or the effects of such activities occur primarily within such county․ In any investigation or action undertaken or brought by a district attorney pursuant to this section, if the Attorney General deems it necessary and in the public interest, the Attorney General may take full charge of any such investigation or prosecution, ․”
“(i) In any action brought pursuant to subdivision (g) a district attorney may represent any political subdivision located within his or her county directly, in which case he or she shall notify in writing such political subdivision of his or her intention to bring any such action on its behalf, and at any time within 30 days thereafter, that political subdivision may, by formal resolution of its governing body or as otherwise specifically provided by applicable law, withdraw the authority of the district attorney to bring the intended action. In any action in which a district attorney directly represents any political subdivision located within his county, the district attorney shall retain out of the proceeds [a certain amount]. In any action brought pursuant to subdivision (g) in which the county, through the district attorney, is the class representative of political subdivisions located within such county the district attorney shall retain [any attorneys' fees awarded by the court]․”
In addition to the foregoing amendments to section 16750, the Legislature also enacted section 16760 in 1977. (Stats.1977, ch. 543, § 1.) That section, in relevant part, provides:
“(a)(1) The Attorney General may bring a civil action in the name of the people of the State of California, as parens patriae on behalf of natural persons residing in the state, in the superior court of any county which has jurisdiction of a defendant, to secure monetary relief as provided in this section for injury sustained by such natural persons to their property by reason of any violation of this chapter․”
“(g) The district attorney of any county may prosecute any action on behalf of the natural persons residing in such county which the Attorney General is authorized to bring pursuant to subdivision (a) whenever it appears that the activities giving rise to such prosecution or the effects of such activities occur primarily within such county․”
B. Application of Code Sections in the Present Case.
In applying section 16750 to the facts before us, we seek to vindicate the legislative intent underlying that section. “ ‘In determining intent, we look first to the words [of the statute] themselves. [Citations.] When the language is clear and unambiguous, there is no need for construction. [Citations.] When the language is susceptible of more than one reasonable interpretation, however, we look to a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part. [Citations.]’ ” (Granberry v. Islay Investments (1995) 9 Cal.4th 738, 744, 38 Cal.Rptr.2d 650, 889 P.2d 970, quoting from People v. Woodhead (1987) 43 Cal.3d 1002, 1007–1008, 239 Cal.Rptr. 656, 741 P.2d 154.)
In the present case, determination of whether section 16750 is clear on its face or is instead ambiguous, thus necessitating construction and interpretation, requires that we first provide a historical or political context for the language the Legislature has chosen to use. This context is provided by focusing on the nature of the offices of Attorney General and district attorney.
Fundamentally, both offices have a dual character. (See Florida ex rel. Shevin v. Exxon Corp. (5th Cir.1976) 526 F.2d 266, 268 [historical overview of office of Attorney General].) First, each is the attorney for the government, whether at the state or local level. Thus, for example, the Attorney General is the legal adviser to all state departments in matters relating to the department or the powers and duties of its officers. (Gov.Code, § 11157; see also Gov.Code §§ 11040–11041.) Similarly, the district attorney “shall render legal services to the county without fee and may render legal services to school districts and to other local public entities as requested․” (Gov.Code, § 26520.) 6 We will refer to this as the “government lawyer” function of the Attorney General and the district attorney.
In their other capacity, by contrast, the Attorney General and the district attorney are public officials invested with the powers of the sovereign; they act directly and on behalf of the public. The most obvious example of this power is in bringing criminal prosecutions in the name of the People. While the district attorney's staff is “the lawyer” for the People, there is no “client” who must be consulted or obeyed. (In a significant sense, the district attorney is both “client” and “lawyer.”)
There are other examples of sovereign power vested in the Attorney General or district attorney. The district attorney may file an action to abate a nuisance in his county. (Gov.Code, § 26528.) The Attorney General may institute actions in the name of the state or a state agency concerning title, boundaries or possession of real property in which the state has an interest. (Gov.Code, § 12518.) Closer to the subject of the present case, the Attorney General may bring an action “in the name of the people of the State of California, as parens patriae on behalf of natural persons residing in the state” to recover damages for violations of the Cartwright Act. (§ 16760, subd. (a)(1).) The district attorney has the same power to prosecute such actions “on behalf of the natural persons residing in such county.” (§ 16760, subd. (g).) We will refer to this as the “public official” function of the Attorney General and district attorney.
Thus, the Attorney General and the district attorney in some instances function as lawyers for actual clients, i.e., the state or political subdivisions thereof, and sometimes they function as public officials in their own right.7 The primary difference, for present purposes, is that in the first instance the client decides whether to litigate or to settle. In the second instance, the Attorney General or the district attorney exercises the statutory discretion to litigate or to settle.
Recognition of these two different historical roles is necessary to properly discern the legislative intent embodied in section 16750. When section 16750 is viewed as addressing only the “public official” Attorney General or district attorney—that is, the official who directly exercises statutory power and who does not have an actual “client” in any traditional sense—the legislative intent becomes clear and unambiguous. Ambiguity and the need for statutory construction appear only if we try, as appellant does, to apply the language of section 16750 to the “government attorney” function of the Attorney General and the district attorney.
The focus of the Legislature on the “public official” role of the Attorney General and the district attorney is reflected in the language used in section 16750. For example, the Attorney General must “notify in writing any political subdivision or public agency of his or her intention to bring any such action on its behalf․” (§ 16750, subd. (c).) Thus, the initial decision to bring suit lies with the Attorney General, not with the injured entity. This “on behalf of” language again appears in section 16760, the parens patriae section, where the Attorney General even more clearly acts as a “public official,” not as the lawyer for a government entity.
A further example of the “public official” orientation of the legislation is found in the requirement that the Attorney General retain any attorney fees awarded in an action “in which the Attorney General is the class representative of political subdivisions, public agencies, or citizens of the state․” (§ 16750, subd. (d).) This phrasing contemplates that the Attorney General “is” the class representative, i.e., the party plaintiff. The district attorney is likewise required to retain such fees in any action “in which the county, through the district attorney, is the class representative․” (§ 16750, subd. (i).)
This unambiguous reference in section 16750 to the “public official” function of the Attorney General and the district attorney is confirmed when we look at the informal legislative history of section 16750. Although the materials submitted by respondents from the legislative author's file are very weak indications of legislative intent and by no means have dictated our conclusions in this case, the materials provide some confirmation that our plain reading of the statutes is not misguided. (Cf. Producers Dairy Delivery Co. v. Sentry Ins. Co. (1986) 41 Cal.3d 903, 914, 226 Cal.Rptr. 558, 718 P.2d 920 [statutes as confirming plain language of insurance policy].)
In an early staff explanation of the proposed 1961 amendment to section 16750, we find:
“[T]he bill would authorize the Attorney General to bring damage actions on behalf and in the name of public subdivisions and public agencies of the State, as well as of the State itself. The need for such standing authority was recently demonstrated in the case now pending to recover treble damages on behalf of more than 100 school districts throughout the State. For want of existing authority, it was necessary to contact each school district which had been injured and to secure individual resolutions authorizing the Attorney General to act on behalf of such district.” (Author file, document 2, p. 3.)
The foregoing reflects that, prior to the 1961 amendments, the Attorney General already exercised the authority to serve as “government lawyer” for governmental clients in antitrust actions; the proposed legislation conferred “public official” status on the Attorney General independently to bring such actions in the name of the injured agency or political entity. This duality is reflected again in a questionnaire prepared by the author of the amendments:
“The bill is permissive only. It does not curtail or restrict the authority of any local agency of government from independently bringing its own action whenever it desires.” (Author file, document 3, pp. 2–3.)
The amendments to section 16750, as originally introduced in the Legislature, omitted the proviso now contained in the first sentence of section 16750, subdivision (c).8 A critic of the proposed legislation, general counsel for the Sacramento Municipal Utility District, E.R. Davis, objected by letter to the bill's author that the
“bill presumably would enable the Attorney General to bring a suit for damages in antitrust matters with or without the concurrence of the public agency․ However, public agencies ․ in the utility business [ ] would want to make their own decision whether antitrust claims should be pursued.” (Letter dated March 28, 1961, addressed to Wallace Howland, Assistant Attorney General.)
Davis suggested as an alternative “that the Attorney General may bring the action unless there is objection by the public agency.” (Ibid.) Such language was added by amendment to the bill and is now contained in section 16750.
Thus, the plain language of section 16750 and the available legislative history both confirm that the Legislature, in amending section 16750 in 1961, (a) did not intend to alter the then-existing ability of local governments to institute antitrust actions through their own lawyers and did not alter the ability of the Attorney General's office to serve as such lawyers for the local entity; 9 and (b) did intend to vest in the Attorney General the power to exercise, within limits, the right of state and local governmental entities to bring suit for antitrust violations.
Similarly, in the 1977 amendments, some of the “public official” power of the Attorney General was delegated to the district attorney. Thus where the anticompetitive “activities ․ or effects of such activities” are local in nature, the district attorney may bring suit in the name of local governments, subject to divestment of that authority by the local government on written notice or by the Attorney General when “necessary and in the public interest.” 10
Having reviewed the duality of the “government lawyer” and “public official” functions of the Attorney General and the district attorney underlying the language and legislative history of section 16750, we return to appellant's primary argument on appeal and the erroneous premise of the argument. Appellant summarizes its argument, as follows:
“The state, its political subdivisions and public agencies have standing to sue as plaintiffs, but the Cartwright Act vests the authority to represent these entities in the Attorney General. In other words, public agencies have a right to claim damages under the act, but this right can only be enforced by the Attorney General. In 1977 the legislature delegated a segment of the Attorney General's exclusive representation authority to district attorneys who were allowed to file local antitrust actions after notice to the Attorney General. But the Cartwright Act remains steadfast that only the Attorney General can file statewide antitrust actions in state or federal court.”
We conclude that section 16750 has nothing to do with “representation” of governmental entities by the Attorney General. Instead, such representation in antitrust actions initiated by local government is governed by general statutory law and common law permitting the Attorney General and district attorney to represent governmental entities in litigation and by general statutory provisions governing the hiring of outside counsel by local entities. (See, e.g., Gov.Code, § 31000.) Rather than regulating representation, section 16750 creates in the Attorney General and the district attorney the authority to exercise, within limits, the governmental power to sue for antitrust injuries to the governmental entity and to settle such suits in the public interest.11
It is true, as appellant argues, that subdivisions (c), (d), and (i) of section 16750 contemplate that the Attorney General and the district attorney may bring an action as either a class action or as an ordinary lawsuit. Also, subdivision (i) only permits a district attorney to file a class action on behalf of governmental entities within his or her county. But the distinction being drawn in subdivision (i) only concerns the power of the district attorney in his or her “public official” capacity—i.e., the degree of such power delegated by the 1977 amendments from the Attorney General (and, thus, in turn from the body politic) to the district attorney, namely the power to act “on his own” on behalf of the government. This transfer of power from the Attorney General to the district attorney did not remove from any governmental entity its own power to commence an antitrust action; that power was preserved to the governmental entities in the 1961 amendments. The 1977 amendments only took part of the power the Attorney General had obtained in 1961 and further delegated that power to the district attorney.
This view of section 16750 as addressing only the “public official” function of the Attorney General and the district attorney, and not their “government lawyer” function, provides a cohesive framework for understanding section 16750 and its legislative history. Appellant and amicus argue, however, that any interpretation that permits an individual county or other entity to sue as class representative for other counties or local entities would present the risk of a county running amok, doing violence to statewide antitrust policy. Appellant paints a picture of every mosquito abatement district in the state engaging in class actions about which they cannot reasonably expect to exercise competent judgment. Amicus states that only the Attorney General “has the duty and expertise to coordinate antitrust enforcement on a statewide basis, ․”
The answer to these concerns lies in the law of class actions, however, and not in the law conferring upon local governments rights under the antitrust laws. Issues about a litigant's ability to provide adequate legal representation for the class or to tender claims typical of the class are part of the decisionmaking matrix of the trial court in determining whether to certify a particular action as a class action. (See Fed.Rules Civ.Proc., rule 23, esp. (b)(2), (c), (e); City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 453, 115 Cal.Rptr. 797, 525 P.2d 701 [California procedures to be guided by federal rule 23 procedures].) Provisions governing “(b)(3)” class actions such as this one require notice to class members, the opportunity to opt out of the class and other protection for class members not found in section 16750. (See Fed.Rules Civ.Proc., rule 23(c) and (e).)
In summary, on the one hand, the existence of a private cause of action for damages does not inherently include the right to prosecute that cause of action in a class action lawsuit; federal rule 23 and Code of Civil Procedure section 382 are the basis for the right to bring a class action. On the other hand, problems that might make a class action inappropriate in a particular case do not undermine the individual cause of action of the governmental entity provided by the Cartwright Act; those problems are to be addressed as provided by the body of class action law.12
This brings us to appellant's next argument, that the county has no independent power to bring an antitrust action under the Cartwright Act apart from the limited standing it says is conferred by subdivisions (c) and (g) of section 16750. Appellant says People ex rel. Freitas v. City and County of San Francisco, supra, 92 Cal.App.3d 913, 155 Cal.Rptr. 319 and County of San Luis Obispo v. Abalone Alliance (1986) 178 Cal.App.3d 848, 223 Cal.Rptr. 846 stand for the proposition that Government Code section 23004, which provides that a county may “sue or be sued,” does not give the county independent power to sue under the Cartwright Act.
Government Code section 23004 does not, of itself, create any cause of action, under the Cartwright Act or otherwise. Government Code section 23004 merely makes the county a proper party in a lawsuit. That is the meaning of Freitas and Abalone Alliance. Freitas holds that a city and county is not a “person” made liable under the Cartwright Act by section 16702, and the fact that it may “be sued” pursuant to Government Code section 23004 does not, in itself, create liability. Yet Freitas specifically notes that the Cartwright Act does make a city or county a “person” who can be injured and can sue under section 16750, subdivision (b). (People ex rel. Freitas v. City and County of San Francisco, supra, 92 Cal.App.3d at p. 920, 155 Cal.Rptr. 319.)
Abalone Alliance merely holds that a county must have a recognized cause of action on which to sue, even though it is given a generalized capacity to sue by Government Code section 23004. (County of San Luis Obispo v. Abalone Alliance, supra, 178 Cal.App.3d at pp. 860–861, 223 Cal.Rptr. 846.) Accordingly, Abalone Alliance is inapplicable here, since the county does have a cause of action under section 16750, subdivisions (a) and (b) of the Cartwright Act, upon which it has sued pursuant to the capacity to sue set forth in Government Code section 23004.
The interpretation of section 16750 outlined above is coherent and in keeping with the language of that section and the available legislative history. Appellant's interpretation is not. For example, consider a five-county emergency medical services agency established pursuant to section 1797 et seq. of the Health and Safety Code. If ambulance companies in that five-county area conspired to fix the price for emergency services charged to each county, the activities and effects would not be “primarily in” any single county. Under appellant's interpretation, neither the district attorney nor the counties involved could sue the ambulance providers; only the Attorney General would be able to bring the action under section 16750, subdivision (c).
We find nothing in the statutory scheme that would leave counties and other local governmental entities wholly subject to the discretion of the Attorney General to provide representation in the circumstances just described. Nor can we conceive of any public policy reason that would permit the ambulance companies' anticompetitive activity to continue just because the Attorney General had insufficient resources to address the matter.
Yet such a situation is a necessary component of appellant's interpretation of the statute. That interpretation is not limited to class actions, but instead would divide the universe of permissible antitrust litigation by local governments, whether by class action or not, into just two fields, activities with sufficient “statewide effect” to attract the Attorney General's interest and those “primarily in one county,” which the district attorney may address. As we have seen, there are important examples of anticompetitive action, such as that involving the hypothetical regional emergency medical services authority, that may fit into neither category. We believe an interpretation that does not leave gaping holes in the enforcement structure more probably reflects the intent of the Legislature.
Notwithstanding the ample reasons supporting our interpretation of section 16750, there is an inconsistency between that interpretation and section 16754. Section 16754, it will be recalled, provides in relevant part:
“The Attorney General, or the district attorney of any county ․ shall initiate civil actions or criminal proceedings for violation of this chapter. Civil actions and criminal proceedings for violation of this chapter initiated by the Attorney General or district attorney may be brought in the superior court in and for any county where the offense or any part thereof is committed or where any of the offenders reside or where any corporate defendant does business․”
We are unable to find any straightforward meaning for the use of “shall” in the first sentence of section 16754. It is obvious that the sentence does not mean, “Only the attorney general or the district attorney shall initiate civil actions․” This reading would preclude civil actions by private persons, whose rights are created in the same subdivision of section 16750 that, indistinguishably, creates the rights of governmental entities. (See § 16750, subd. (a).)
Clearly, the first sentence of section 16754 does not mean, “The attorney general or the district attorney shall, upon request of a government entity, initiate civil actions․” Where the Legislature has imposed a mandatory duty on government lawyers, it has done so explicitly: “The district attorney may, and when directed by the board of supervisors shall, bring a civil action in the name of the people of the State of California to abate a public nuisance in his county.” (Gov.Code, § 26528.)
In examining the prior version of section 16754 that was replaced in 1961 with, essentially, the present version, we find the use of “shall” in a more intelligible context:
“Every person who violates this chapter shall for each day that such violations are committed or continued, after due notice given by the Attorney General or any district attorney, forfeit and pay the sum of fifty dollars ($50), which may be recovered in the name of the people of this State in any county where the offense is committed, or where either of the offenders resides. The Attorney General, or the district attorney ․ shall prosecute for the recovery of the forfeit. When the action is prosecuted by the Attorney General against a corporation or an association of persons, he may begin the action in the superior court in and for the county where the defendant resides or does business.” (See Stats.1941, ch. 526, § 1.)
The most plausible explanation for the present use of “shall” is that the 1961 amendment was drafted by the “blue pencil” method, where unnecessary language from the old section is stricken through and the necessary new language is inserted. Thus, in 1961, at the same time the Attorney General was permitted to sue on behalf of local government entities, forfeiture was deleted as an available enforcement mechanism; the first sentence of the old section 16754 was therefore stricken out. The remaining sentences of the old section 16754 were modified by inserting “initiate civil actions or criminal proceedings” instead of “prosecute for the recovery of the forfeit,” in order to make section 16754 a general venue statute for antitrust suits brought by the government. In other words, the first sentence, including the use of the word “shall,” became surplusage. “Shall” meant neither “must,” as it had in the phrase “shall prosecute for recovery of the forfeit,” nor did it mean “only the attorney general shall ․” because there is no textual or historical support for such a meaning. We conclude that the first sentence of section 16754 simply means: “The attorney general, or the district attorney of any county ․ shall, when appropriate, initiate civil actions or criminal proceedings for violation of this chapter.”
The legislative history of section 16754 confirms this interpretation. The Legislative Counsel's digest of Assembly Bill No. 894, which enacted the 1961 amendments to section 16754, states that the bill “[p]rovides for venue of actions brought under [statutes prohibiting combinations in restraint of trade] under certain circumstances.” The bill questionnaire states that the bill “clarifies and establishes the venue of all actions, either civil or criminal, for violation of the Cartwright Act brought by the Attorney General or by a District Attorney․” As the bill memorandum dated June 8, 1961, to Governor Edmund G. Brown states: “The venue provision was mainly for the purpose of giving the Superior Courts jurisdiction in criminal Cartwright cases rather than the Municipal Courts as presently provided.” Nothing in the legislative history of section 16754 indicates it was intended to restrict the ability of local governments to prosecute civil antitrust actions in their own behalves and with their own resources.
For the reasons we have expressed, we conclude that the plain language of section 16750, subdivisions (a) and (b), permits counties and other governmental entities with the capacity to sue to bring and prosecute Cartwright Act actions on an equal footing with any other “person.” This includes the option to proceed on a class action basis when the trial court certifies that such basis is appropriate in the particular lawsuit. Neither subdivision (c) or (g) of section 16750, individually or read together, limits the prosecution of the subdivision (a) cause of action. Subdivisions (c) and (g) simply provide a further mechanism by which anticompetitive activity may be attacked.
The judgment is affirmed. Costs on appeal are awarded to respondents.
1. The complaint alleges violations of the Sherman Act (15 U.S.C. § 1 et seq.), the Wilson Tariff Act (15 U.S.C. § 8 et seq.), and the Clayton Act (15 U.S.C. § 12 et seq.).
2. The Cartwright Act (Bus. & Prof.Code, § 16700 et seq.) is the California counterpart of federal antitrust laws. The Unfair Practices Act (Bus. & Prof.Code, § 17000 et seq.) prohibits “unfair, dishonest, deceptive, destructive, fraudulent and discriminatory practices by which fair and honest competition is destroyed or prevented.” (Bus. & Prof.Code, § 17001.)
3. Code of Civil Procedure section 526a provides, in relevant part: “An action to obtain a judgment, restraining and preventing any illegal expenditure of, waste of, or injury to, the estate, funds, or other property of a county, town, city or city and county of the state, may be maintained against any officer thereof, or any agent, or other person, acting in its behalf, either by a citizen resident therein, or by a corporation, who is assessed for and is liable to pay, or, within one year before the commencement of the action, has paid, a tax therein.”
4. All further statutory references are to the Business and Professions Code except when otherwise indicated.
5. Due to the nature of the issue presented, the court invited the Attorney General to appear in this appeal as amicus curiae. He accepted the invitation and filed a letter brief on April 11, 1995. That brief states that “although the matter is not free from doubt, the Attorney General has exclusive authority to bring statewide class actions for treble damages under state and federal antitrust laws on behalf of political subdivisions and other public agencies of the state.” We address specific arguments in the amicus brief at various points below.
6. County counsel serves as legal advisor to the county if the county has created such position. (Gov.Code, § 26526.) Further, “[w]henever the board of supervisors appoints a county counsel pursuant to this chapter, he shall discharge all the duties vested by law in the district attorney other than those of a public prosecutor.” (Gov.Code § 27642.) In the federal class action, the county is represented by county counsel and by private counsel. To the extent the county has an independent right of action under section 16750, subdivisions (a) and (b), appellant does not contend county counsel and private counsel are inappropriate attorneys for the county. Appellant simply disagrees there is such a right of action in the present circumstances. Appellant does argue that the section 16750, subdivision (g) powers of the district attorney cannot be exercised by county counsel pursuant to Government Code section 27642. Because we hold that the power to prosecute the Cartwright Act class action arises from section 16750, subdivision (a), and not section 16750, subdivision (g), we need not reach appellant's contention. The right to sue under federal antitrust laws is conferred by those laws. (See, e.g., Georgia v. Evans (1942) 316 U.S. 159, 162, 62 S.Ct. 972, 973, 86 L.Ed. 1346.)
7. A case cited by both parties is a clear example of this duality. In People ex rel. Freitas v. City and County of San Francisco (1979) 92 Cal.App.3d 913, 155 Cal.Rptr. 319, the district attorney, in his “public official” role sued his own government entity, the City and County of San Francisco, for antitrust violations in setting taxi fares. The City and County was represented by the City Attorney, acting in the role of “government lawyer.”
8. That sentence now reads: “The Attorney General may bring an action on behalf of the state or of any of its political subdivisions or public agencies to recover the damages provided for by this section, or by any comparable provision of federal law, provided that the Attorney General shall notify in writing any political subdivision or public agency of his or her intention to bring any such action on its behalf, and at any time within 30 days thereafter, such political subdivision or public agency may, by formal resolution of its governing body or as otherwise specifically provided by applicable law, withdraw the authority of the Attorney General to bring the intended action.” The portion set out in boldface was not contained in the amendments as originally proposed.
9. We find nothing at all implausible or absurd, as suggested by amicus, about a statutory scheme that reserves to the local elective governing body the determination to use local resources to sue on a statutory cause of action. Such power is normal for a local governing body. (See Gov.Code, § 23005 [“A county may exercise its powers only through the board of supervisors or through agents and officers acting under authority of the board or authority conferred by law”].)
10. Thus, properly viewed, subdivisions (d) and (g) of section 16750 are new and supplementary grants of enforcement power. As such, there is no anomaly in the Attorney General's responsibility to supervise the new power of the district attorney, but lack of responsibility to supervise the previously existing enforcement authority of local governmental entities. Instead of such supervisory responsibility in the case of actions initiated by local governments, the Attorney General is authorized to “render legal services as special counsel to” the local entity under certain circumstances. (See § 16750, subd. (e).)
11. This statutory scheme finds a parallel in section 16760. There, individuals retain all rights to sue for individual violations of antitrust laws, but the Attorney General and the district attorney are given concurrent power to sue on behalf and in the name of such individuals as a class. The creation of a concurrent power in the Attorney General or the district attorney does not divest individuals of the initial power to file suit on their own behalf, nor to “opt out” of such a suit, just as the local entity can under section 16750. (See section 16760, subd. (b)(2); see Bruno v. Superior Court (1981) 127 Cal.App.3d 120, 133, 179 Cal.Rptr. 342.)
12. We express no opinion about the validity of a legislative restriction that expressly prevented local governments from seeking an otherwise available federal court remedy, such as a class-wide damages judgment under the Sherman Act. We have concluded in the present case that section 16750 is not such a legislative restriction on local government entities.
ARDAIZ, P.J., and THAXTER, J., concur.