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Green v. Garcia-Victor

Court of Appeals of Louisiana, Fourth Circuit

May 16, 2018

REGINALD GREEN, ET AL
v.
FRANKLIN ELIEZER GARCIA-VICTOR, ET AL

          APPLICATION FOR WRITS DIRECTED TO CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2016-00905, DIVISION "I-14" Honorable Piper D. Griffin, Judge

          James M. Garner Timothy B. Francis Matthew M. Coman Michael R. Dodson SHER GARNER CAHILL RICHTER KLEIN & HILBERT, L.L.C. COUNSEL FOR DEFENDANTS/RELATORS

          Ira J. Middleberg Yvette A. D'Aunoy Marianne Garvey MIDDLEBERG RIDDLE GROUP COUNSEL FOR PLAINTIFFS/RESPONDENTS

          Court composed of Chief Judge James F. McKay III, Judge Terri F. Love, Judge Edwin A. Lombard, Judge Roland L. Belsome, Judge Daniel L. Dysart, Judge Joy Cossich Lobrano, Judge Rosemary Ledet, Judge Sandra Cabrina Jenkins, Judge Regina Bartholomew-Woods, Judge Paula A. Brown, Judge Tiffany G. Chase, Judge Dennis R. Bagneris, [1] Pro Tempore

          TERRI F. LOVE JUDGE

          This application for supervisory review arises from petitions filed by cab drivers against Uber drivers alleging violations of the Louisiana Unfair Trade Practices Act. Following supplementation of the original petition, the Uber drivers filed an exception of no cause of action, which the trial court denied. The Uber drivers sought our supervisory review. This Court denied the writ, and the Uber drivers sought review from the Louisiana Supreme Court. The Supreme Court remanded the matter for full briefing, oral argument, and opinion.

         This Court considered the matter en banc and finds that the trial court did not err by denying the Uber drivers' exception of no cause of action because the cab drivers set forth a cause of action. Thus, the application for supervisory review is denied.

         FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         A group of cab drivers ("Cabbies") filed a Petition Based Upon Unfair Trade Practices, Request for Class Certification and Request for Injunctive Relief against a group of Uber drivers ("Ubers") alleging that they were operating in violation of the Louisiana Unfair Trade Practices Act ("LUTPA"). The Cabbies contended that the Ubers' violations of the Louisiana Motor Vehicle Safety Law, the Louisiana Driver's License Law, and other municipal ordinances constituted unfair trade practices.

         The Ubers filed Exceptions of No Cause of Action and No Right of Action. The trial court granted the Exception of No Cause of Action as to the Cabbies' LUTPA claims, but denied the Exception of No Right of Action regarding the alleged violations of the Louisiana Driver's License Law. This Court and the Louisiana Supreme Court denied writs on that judgment. Green v. Garcia-Victor, 16-0447, unpub. (La.App. 4 Cir. 5/31/16), writ denied, 16-1249 (La. 10/28/16), 208 So.3d 379.

         The Cabbies filed a First Supplemental and Amended Petition asserting additional violations of municipal ordinances to establish liability pursuant to LUTPA.[2] The Cabbies then filed a Second Amending, Supplemental and Restated Petition alleging that the Ubers performed the same work as the Cabbies, who have commercial driver's licenses, but were not subject to the same regulatory requirements, which resulted in disparate treatment by the City of New Orleans. The Cabbies contended that the Ubers: (1) accepted passengers for cash without the Uber app; (2) staged and used cab stands; (3) accepted fares to and from the airport without authorization; (4) failed to notify Uber (the Transportation Network Company "TNC")[3] and its insurer of accidents; (5) transported passengers without a chauffeur's license; and (6) prohibited cabs from picking up and dropping off customers at the Voodoo Experience Music Festival. The Cabbies further asserted that the Ubers were engaging in illegally providing transportation services for hire, and that their non-compliance with state regulatory rules resulted in unfair competition pursuant to LUTPA. Moreover, the Cabbies averred that they "suffered an ascertainable loss of money or movable property, corporeal or incorporeal, as a result of the use or employment by Defendants of an unfair and unlawful trade practice in violation of Louisiana Revised Statute §51:1405." They asserted that they suffered "harm, injuries, and damages, including loss of income, relevant market share, business reputation, goodwill, and attorneys' fees and costs." The Cabbies also alleged the following class of defendants, for purposes of class action: "All UberX drivers operating in New Orleans during the time of April 16, 2015 through the present."

         Subsequently, the Ubers filed an Exception of No Cause of Action regarding the Second Amending, Supplemental and Restated Petition. The trial court denied the exception and stated the petition, as written, sufficiently stated a cause of action. The Ubers sought supervisory review from this Court. This Court denied writs. Green v. Garcia-Victor, 17-0695, unpub. (La.App. 4 Cir. 11/13/17). The Louisiana Supreme Court granted writs and remanded the matter "for briefing, argument, and full opinion." Green v. Garcia-Victor, 17-2071 (La. 02/02/18). This Court heard the matter en banc on April 18, 2018.

         STANDARD OF REVIEW

         "Questions of law are reviewed by the appellate court under the de novo standard of review." Cosey on behalf of Hilliard v. Flight Acad. of New Orleans, LLC, 17-0364, p. 3 (La.App. 4 Cir. 10/25/17), __So. 3d__, __, 2017 WL 4803829, *3. "Exceptions of no cause of action present legal questions, which are reviewed using the de novo standard of review." O'Dwyer v. Edwards, 08-1492, p. 3 (La.App. 4 Cir. 6/10/09), 15 So.3d 308, 310.

          NO CAUSE OF ACTION

         "An exception is a means of defense, other than a denial or avoidance of the demand, used by the defendant, whether in the principal or an incidental action, to retard, dismiss, or defeat the demand brought against him." La. C.C.P. art. 921. An exception of no cause of action is a peremptory exception. La. C.C.P. art. 927(A). "The function of the peremptory exception is to have the plaintiff's action declared legally nonexistent, or barred by effect of law, and hence this exception tends to dismiss or defeat the action." La. C.C.P. art. 923. "On the trial of the peremptory exception pleaded at or prior to the trial of the case, evidence may be introduced to support or controvert any of the objections pleaded, when the grounds thereof do not appear from the petition." La. C.C.P. art. 931. However, "[n]o evidence may be introduced at any time to support or controvert the objection that the petition fails to state a cause of action." La. C.C.P. art. 931. "The burden of demonstrating that the petition states no cause of action is upon the mover." 831 Bartholomew Investments-A, L.L.C. v. Margulis, 08-0559, p. 10 (La.App. 4 Cir. 9/2/09), 20 So.3d 532, 538.

         "The questioned [sic] posed by an exception of no cause of action is "whether the law provides a remedy against the particular defendant.'" 2400 Canal, LLC v. Bd. of Sup'rs of Louisiana State Univ. Agr. & Mech. Coll., 12-0220, pp. 6-7 (La.App. 4 Cir. 11/7/12), 105 So.3d 819, 825, quoting Badeaux v. Southwest Computer Bureau, Inc., 05-0612, 05-0719, p. 7 (La. 3/17/06), 929 So.2d 1211, 1216-17. "An exception of no cause of action tests "the legal sufficiency of the petition by determining whether the law affords a remedy on the facts alleged in the pleading.'" Moreno v. Entergy Corp., 10-2281, p. 3 (La. 2/18/11), 62 So.3d 704, 706, quoting Everything on Wheels Subaru, Inc. v. Subaru South, Inc., 616 So.2d 1234, 1235 (La. 1993). "In deciding an exception of no cause of action a court can consider only the petition, any amendments to the petition, and any documents attached to the petition." 2400 Canal, LLC, 12-0220, p. 7, 105 So.3d at 825. "A court cannot consider assertions of fact referred to by the various counsel in their briefs that are not pled in the petition." Id. "The grant of the exception of no cause of action is proper when, assuming all well pleaded factual allegations of the petition and any annexed documents are true, the plaintiff is not entitled to the relief he seeks as a matter of law." Id. Further, "any doubt must be resolved in the plaintiffs' favor." Id.

         "Louisiana has chosen a system of fact pleading." 831 Bartholomew, 08-0559, p. 9, 20 So.3d at 538. "Therefore, it is not necessary for a plaintiff to plead the theory of his case in the petition." Id., 08-0559, pp. 9-10, 20 So.3d at 538. "However, the mere conclusions of the plaintiff unsupported by facts does [sic] not set forth a cause of action." Id., 08-0559, p. 10, 20 So.3d at 538.

         The Louisiana Supreme Court reiterated the limitations placed upon the courts when reviewing a trial court's ruling on an exception of no cause of action. "The limited function of an exception of no cause of action is to determine whether the law provides a remedy to anyone assuming that the facts plead in the petition will be proven at trial. In making that limited determination, 'all doubts are resolved in plaintiff's favor.'" Farmco, Inc. v. W. Baton Rouge Par. Governing Council, 01-1086, p. 1 (La. 6/15/01), 789 So.2d 568, 569, quoting 1 Frank L. Maraist & Harry T. Lemmon, Louisiana Civil Law Treatise: Civil Procedure § 6.7(2)(1999) (emphasis added).

         LUTPA

         Louisiana's "Unfair Trade Practices and Consumer Protection Law" provides that "[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful." La. R.S. 51:1405(A). La. R.S. 51:1409(A) provides, in pertinent part:

Any person who suffers any ascertainable loss of money or movable property, corporeal or incorporeal, as a result of the use or employment by another person of an unfair or deceptive method, act, or practice declared unlawful by R.S. 51:1405, may bring an action individually but not in a representative capacity to recover actual damages.

         "Because of the broad sweep of this language, 'Louisiana courts determine what is a LUTPA violation on a case-by-case basis.'" Quality Envtl. Processes, Inc. v. I.P. Petroleum Co., Inc., 13-1582, p. 21 (La. 5/7/14), 144 So.3d 1011, 1025, quoting Keith E. Andrews, Comment, Louisiana Unfair Trade Practices Act: Broad Language and Generous Remedies Supplemented by a Confusing Body of Case Law, 41 Loy. L.Rev. 759, 762 (1996). The Louisiana Supreme Court "has consistently held that in establishing a LUTPA claim, a plaintiff must show that 'the alleged conduct offends established public policy and is immoral, unethical, oppressive, unscrupulous, or substantially injurious.'" Quality Envtl. Processes, 13-1582, p. 21, 144 So.3d at 1025, quoting Cheramie Services, Inc. v. Shell Deepwater Prod., 09-1633, p. 10 (La. 4/23/10), 35 So.3d 1053, 1059. "[T]he range of prohibited practices under LUTPA is extremely narrow." Cheramie, 09-1633, p. 11, 35 So.3d at 1060. "LUTPA prohibits only fraud, misrepresentation, and similar conduct, and not mere negligence." Quality Envtl. Processes, 13-1582, p. 21, 144 So.3d at 1025.

         "LUTPA provides a cause of action both for trade practices which are 'unfair' and those which are 'deceptive.'" Jefferson v. Chevron U.S.A. Inc., 97-2436, p. 13 (La.App. 4 Cir. 5/20/98), 713 So.2d 785, 792. "An act is not required to be both unfair and deceptive." Id. "A practice is unfair when it offends established public policy and when the practice is unethical, oppressive, unscrupulous, or substantially injurious." Id. "A trade practice is 'deceptive' for purposes of LUTPA when it amounts to fraud, deceit or misrepresentation." Id., 97-2436, p. 13, 713 So.2d at 793. "LUTPA does not prohibit sound business practices, the exercise of permissible business judgment or appropriate free enterprise transactions." 831 Bartholomew, 08-0559, p. 11, 20 So.3d at 539. "The LUTPA has not been construed as forbidding 'a business to do what everyone knows a business must do: make money. Businesses in Louisiana are still free to pursue profit, even at the expense of competitors, so long as the means used are not egregious.'" JCD Mktg. Co. v. Bass Hotels & Resorts, Inc., 01-1096, p. 13 (La.App. 4 Cir. 3/6/02), 812 So.2d 834, 842, quoting Turner v. Purina Mills, Inc., 989 F.2d 1419, 1422 (5th Cir. 1993).

         CABBIES' LUTPA CAUSE OF ACTION AGAINST UBERS

         The Ubers contend that the trial court erred because the Cabbies "failed to allege facts establishing that any individual plaintiff suffered any damages as a result of any specific act by any individual defendant" and "because alleged actions by Defendants do not violate any law." The Ubers also maintain that "each individual defective cause of action . . . is based on a separate transaction or occurrence" and should be dismissed.

         The Cabbies have asserted that they have a cause of action pursuant to LUTPA through the Ubers' actions in violating city ordinances and state regulations. The Cabbies assert that various Ubers violated the following ordinances and regulations: (1) Ordinance Article XV, Sec. 162-1724, which prohibits accepting passengers for cash without the UBER app, i.e., street hails; (2)

          Ordinance Article XV, Sec. 162-1735, which prohibits staging and using cab stands; (3) Ordinance Article XV, Sec. 162-1735, which prohibits accepting fares to and from the airport without authorization; (4) Ordinance Article XV, Sec. 162-1715, which requires all TNC vehicles to be inspected annually by a state certified mechanic; (5) Ordinance Article XV, Sec. 162-1713, which requires notification to the TNC and its insurer of accidents and undergoing a drug test within twenty-four hours after an accident; (6) Ordinance Article VII, Sec. 150-985, which concerns the payment of occupational license fees and taxes; (7) La. R.S. 32:402 et seq., the driver's license statute; and (8) La. R.S. 32:861, the minimum ...


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