Eldee-K Rental Properties, LLC v. Directv, Inc. , 748 F.3d 943 ( 2014 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
ELDEE-K RENTAL PROPERTIES, LLC, No. 11-17994
a Connecticut limited liability
company, on behalf of itself and all D.C. No.
others similarly situated, 3:11-cv-02416-
Plaintiff-Appellant, CRB
v.
OPINION
DIRECTV, INC., a Delaware
corporation,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of California
Charles R. Breyer, Senior District Judge, Presiding
Argued and Submitted
November 7, 2013—San Francisco, California
Filed April 9, 2014
Before: Jerome Farris, Susan H. Black*, and
Sandra S. Ikuta, Circuit Judges.
Opinion by Judge Ikuta
*
The Honorable Susan H. Black, Senior Circuit Judge for the U.S. Court
of Appeals for the Eleventh Circuit, sitting by designation.
2 ELDEE-K RENTAL PROPERTIES V. DIRECTV
SUMMARY**
Jurisdiction
The panel affirmed the district court’s Fed. R. Civ. P.
12(b)(1) dismissal for lack of subject matter jurisdiction of
Eldee-K Rental Properties, LLC’s complaint against
DIRECTV, Inc.
Eldee-K, which owns a residential apartment building in
Connecticut, sought to certify a class of all landlords who
own and lease residential multiple dwelling units in the
United States on which DIRECTV installed equipment.
The local action doctrine vests exclusive jurisdiction over
specified types of actions involving real property in the forum
where the property is located. The panel held that the local
action doctrine is jurisdictional. The panel also held that it
was bound by California law as to when an action constituted
a local action for purposes of considering the court’s
jurisdiction. The panel held that Eldee-K’s action was a
local action under California law, and therefore had to be
brought in Connecticut where the real property at issue was
located.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
ELDEE-K RENTAL PROPERTIES V. DIRECTV 3
COUNSEL
Jeffrey S. Nobel, Robert A. Izard (argued), and Mark P.
Kindall, Izard Nobel LLP, West Hartford, Connecticut; Alan
R. Plutzik and Jennifer Rosenberg, Bramson, Plutzik, Mahler
& Birkhaeuser, LLP, Walnut Creek, California, for Plaintiff-
Appellant.
Andrew E. Paris (argued), Grace W. Kang, Sayaka Karitani,
and Alex Akerman, Alston & Bird LLP, Los Angeles,
California, for Defendant-Appellee.
OPINION
IKUTA, Circuit Judge:
The district court dismissed Eldee-K Rental Properties,
LLC’s complaint against DIRECTV, Inc. for lack of subject
matter jurisdiction. Because the district court correctly
determined that Eldee-K’s action was a local action under
California law, and therefore had to be brought in
Connecticut where the real property at issue is located, we
affirm the district court’s dismissal of this action.
I
Eldee-K Rental Properties, LLC, is a limited liability
company organized under the laws of Connecticut. It owns
a residential apartment building in Hartford, Connecticut.
In May 2011, Eldee-K filed a complaint against
DIRECTV, a direct broadcast satellite television provider,
alleging that DIRECTV has a policy of installing satellite
4 ELDEE-K RENTAL PROPERTIES V. DIRECTV
reception equipment in common areas of apartment buildings
and other multiple dwelling units (such as the building’s
exterior walls or rooftop) without the landlord’s consent.
According to the complaint, DIRECTV requires prospective
subscribers who reside in multiple dwelling units to complete
an installation form authorizing the installation of equipment
in common areas. A tenant can either complete Part 1 of the
form by obtaining the landlord’s signature, or Part 2 of the
form by certifying that the landlord has verbally authorized
the installation or that the lease does not require landlord
consent.1 The complaint alleges that DIRECTV permanently
installed equipment at Eldee-K’s apartment building,
including by drilling holes in the exterior of the building,
without obtaining Eldee-K’s consent. Beyond alleging that
DIRECTV drilled holes in the building’s exterior, the
complaint did not identify the specific common areas on its
property where the installation took place.
Based on these allegations, Eldee-K sought to certify a
class of all landlords who own and lease residential multiple
dwelling units in the United States on which DIRECTV
installed equipment based on Part 2 of its installation form.
Eldee-K brought three causes of action against DIRECTV.
First, Eldee-K alleged that DIRECTV violated California’s
Unfair Competition Law (UCL), Cal. Bus. & Prof. Code
1
According to the complaint, Part 2 of DIRECTV’s installation release
form provides that
Landlord approval of a DIRECTV System installation
at _________ (address) has been verbally approved by
my landlord (or is not required pursuant to my lease or
rental agreement).
The complaint does not contain the text of Part 1 of the form.
ELDEE-K RENTAL PROPERTIES V. DIRECTV 5
§§ 17200–10, which makes a person who engages in unfair
competition subject to an injunction and other civil penalties.
The complaint alleged that DIRECTV’s use of Part 2 of the
installation form was an unfair business act that violated the
policies embodied in California Penal Code § 602(m), which
makes “[e]ntering and occupying real property or structures
of any kind without the consent of the owner” a misdemeanor
criminal offense. Through this claim, Eldee-K sought to
enjoin DIRECTV from using Part 2 of the installation form.
Eldee-K’s second and third causes of action were for
negligence. Eldee-K alleged that DIRECTV negligently
breached a legal duty not to install its equipment in common
areas of apartment buildings owned by the putative class
without the landlord’s consent. Eldee-K sought declaratory
and injunctive relief in Count II to prohibit DIRECTV’s use
of its Part 2 policy. In its third count, Eldee-K sought
damages for the conduct.
DIRECTV moved to dismiss the complaint on the ground
that the district court lacked subject matter jurisdiction over
Eldee-K’s claims under the local action doctrine, which vests
exclusive jurisdiction over specified types of actions
involving real property in the forum where that property is
located. DIRECTV argued that Eldee-K’s claims are local in
nature, and therefore must be brought in Connecticut, the
state where the property is located.
The district court agreed. It read Eldee-K’s complaint to
focus on DIRECTV’s “unauthorized entry onto property”
pursuant to Part 2 of the installation form. Because “the key
harm” in the complaint related to trespass on real property
situated in Connecticut, the district court held that the local
action doctrine deprived it of jurisdiction to adjudicate the
6 ELDEE-K RENTAL PROPERTIES V. DIRECTV
claim. The district court therefore dismissed it with prejudice
under Rule 12(b)(1) of the Federal Rules of Civil Procedure.
Eldee-K timely appealed.
We have jurisdiction to review Eldee-K’s appeal under
28 U.S.C. § 1291. We review de novo district court
dismissals of actions based on Rule 12(b)(1). Viewtech, Inc.
v. United States, 653 F.3d 1102, 1103–04 (9th Cir. 2011).
II
To determine whether the district court correctly applied
the local action doctrine in this context, it is helpful to review
the history and current status of this longstanding rule.
A
The local action doctrine has an ancient heritage.
According to legal historians, the distinction between local
and transitory actions began to arise in England during the
15th and 16th centuries. See William H. Wicker, The
Development of the Distinction Between Local and Transitory
Actions, 4 Tenn. L. Rev. 55, 58–59 (1925). Before the 15th
century, jurors relied on their personal knowledge of a dispute
to decide cases. Witnesses, as we use them today, played no
role in court. See id. at 55–56; cf. Livingston v. Jefferson,
15 Fed. Cas. 660, 663 (C.C.D. Va. 1811) (op. of Marshall, J.).
For this reason, a plaintiff had to plead the location of the
dispute, and at least some members of every jury had to be
drawn from that location. See Wicker, supra, at 55, 59–60.
After witnesses began to testify during the 15th century,
courts started to relax the rules requiring jurors to come from
the vicinity of the dispute. See id. at 55–57, 60.
ELDEE-K RENTAL PROPERTIES V. DIRECTV 7
The old rules were maintained, however, for actions
directly operating on real estate or personal actions closely
connected with real property, and courts still required
plaintiffs to plead and prove the location where these causes
of action arose. See id. at 62. Such actions were referred to
as local actions and were required to be brought in the county
where the real estate was located, while actions for which the
plaintiff did not need to identify the location of the dispute
were called transitory actions and could be brought in any
county in England. See id. at 61–62. By the late 18th
century, leading jurists had observed that these distinctions
were outmoded, see, e.g., Mostyn v. Fabrigas, (1774)
1 Cowp. 161, 176 (K.B.) (op. of Lord Mansfield) (quoted in
Wicker, supra, at 63), but they nevertheless persisted as part
of English common law.
The distinction between local and transitory actions was
recognized as part of American common law in the leading
case of Livingston v. Jefferson. In this case, Chief Justice
John Marshall, sitting as a circuit judge in Virginia, held that
a federal court in Virginia lacked subject matter jurisdiction
to adjudicate an action against former President Thomas
Jefferson to recover damages for trespass on real estate in
Louisiana. See 15 Fed. Cas. at 665. Although Chief Justice
Marshall expressed skepticism about the value of the local
action doctrine, see id. at 664, he acknowledged that
American law had incorporated “the ancient rules” of English
common law, including the rule “that actions are deemed
transitory, where transactions on which they are founded,
might have taken place anywhere; but are local where their
cause is in its nature necessarily local,” id. at 664–65.
The Supreme Court subsequently confirmed that federal
law incorporates the local action doctrine. As the Court
8 ELDEE-K RENTAL PROPERTIES V. DIRECTV
explained, “[t]he distinction between local and transitory
actions is as old as actions themselves, and no one has ever
supposed that laws which prescribed generally where one
should be sued, included such suits as were local in their
character, either by statute or the common law, unless it was
expressly so declared.” Casey v. Adams, 102 U.S. 66, 67–68
(1880). Accordingly, the Court interpreted a federal statute
allowing a national bank to be sued in any jurisdiction where
the bank is located as pertaining to transitory actions only,
because actions that are local in character must be brought
“where the thing on which they are founded is situated.” Id.In a subsequent opinion, the Supreme Court confirmed that a
federal court lacked jurisdiction over a local action involving
real property situated in a different state. See Ellenwood v.
Marietta Chair Co., 158 U.S. 105, 107–08 (1895). In
Ellenwood, the Court considered an action brought in a
federal circuit court in the Southern District of Ohio against
an Ohio corporation for trespass on land situated in West
Virginia. Id. at 106, 108. The Court sua sponte dismissed the
action for lack of jurisdiction, because “an action for trespass
upon land, like an action to recover the title or the possession
of the land itself, is a local action, and can only be brought
within the state in which the land lies.” Id. at 107. Because
the “entire cause of action was local,” the Court concluded
that the federal court “had no jurisdiction of the cause of
action, and for this reason, if for no other, rightly ordered the
case to be stricken from its docket, although no question of
jurisdiction had been made by demurrer or plea.” Id. at 108.
The Supreme Court has sometimes applied this doctrine
narrowly. In Stone v. United States, for instance, the Court
held that, where the gravamen of an action is conversion of
lumber and the complaint demanded the value of the personal
property taken, rather than stating a claim for trespass that
ELDEE-K RENTAL PROPERTIES V. DIRECTV 9
sought damages for the harm to the land caused by the
trespass, as in Ellenwood, then the action was transitory and
the local action doctrine was not applicable. 167 U.S. 178,
182 (1897). But the Supreme Court has not overruled the
doctrine, and has referenced it in cases decided after
Ellenwood. See, e.g., Philadelphia Co. v. Stimson, 223 U.S.
605, 622 (1912) (holding that a District of Columbia court
had jurisdiction over a dispute regarding the federal
government’s statutory authority to encroach on the
plaintiff’s property in Pennsylvania because, among other
reasons, the action was not “to restrain trespass” as in
Ellenwood); Dull v. Blackman, 169 U.S. 243, 246–47 (1898)
(noting that a dispute was a local action and had to be
litigated in the state where the land was situated, though a
dispute that “did not operate directly upon the lands” could be
brought in a different state).
We have also recognized the continued applicability of
the local action doctrine in determining the jurisdiction of
federal courts. See, e.g., United States v. Byrne, 291 F.3d
1056, 1060 (9th Cir. 2002) (observing that “the federal
district courts’ jurisdiction over actions concerning real
property is generally coterminous with the states’ political
boundaries,” and holding that the court’s jurisdiction in that
case was “properly exercised in the state where the land is
situated” because the action was local); Josevig-Kennecott
Copper Co. v. James F. Howarth Co., 261 F. 567, 569 (9th
Cir. 1919) (discussing whether the action was local or
transitory, and acknowledging that the district court had
jurisdiction over the action unless the suit was local in
nature); Columbia River Packers’ Ass’n v. McGowan, 219 F.
365, 372–73, 376 (9th Cir. 1914) (holding that a district court
in Washington lacked jurisdiction to enjoin a trespass and
10 ELDEE-K RENTAL PROPERTIES V. DIRECTV
abate a nuisance where the injury and conduct occurred in
Oregon).
To the extent they have reached the issue, other circuit
courts generally agree that the local action doctrine is
jurisdictional in nature, and not merely a rule of venue that
can be waived. See Bigio v. Coca-Cola Co., 239 F.3d 440,
443 (2nd Cir. 2000) (assuming the local action doctrine is
jurisdictional); Hayes v. Gulf Oil Corp., 821 F.2d 285, 287
(5th Cir. 1987) (recognizing that “federal and state courts lack
jurisdiction over the subject matter of claims to land located
outside the state in which the court sits”);2 see also 14D
Charles Alan Wright & Arthur R. Miller, Federal Practice
and Procedure § 3822 (noting that a majority of federal
courts have concluded that the local action doctrine is a rule
of subject matter jurisdiction). Those circuit courts that have
discussed the local action doctrine as a matter of venue have
not directly resolved the question whether the doctrine also
constrains the jurisdiction of federal courts. See Raphael J.
Musicus, Inc. v. Safeway Stores, Inc., 743 F.2d 503, 506 (7th
Cir. 1984) (applying the local action doctrine as a matter of
venue without directly addressing jurisdictional issues).
Because the Supreme Court has indicated a “marked desire to
curtail” federal courts’ “drive-by jurisdictional rulings,” Reed
Elsevier, Inc. v. Muchnick, 559 U.S. 154, 161 (2010) (internal
quotation marks omitted), we do not read these out-of-circuit
2
Despite the clarity of Hayes, later Fifth Circuit opinions have
suggested that the question whether the local action doctrine relates to
jurisdiction or venue remains unresolved. See, e.g., Bailey v. Shell W.
E&P, Inc., 609 F.3d 710, 721 n.4 (5th Cir. 2010) (noting, without
discussing Hayes, that “questions remain as to whether the local action
doctrine runs to the jurisdiction or the venue of a court”).
ELDEE-K RENTAL PROPERTIES V. DIRECTV 11
decisions as providing guidance as to whether the local action
doctrine is jurisdictional in nature.
Our conclusion that the local action doctrine is
jurisdictional is not free from doubt. The Supreme Court has
recently clarified that judge-made rules are not jurisdictional
because “[o]nly Congress may determine a lower federal
court’s subject-matter jurisdiction.” Bowles v. Russell,
551 U.S. 205, 211 (2007) (quoting Kontrick v. Ryan, 540 U.S.
443, 452 (2004)) (internal quotation marks omitted). But
Congress has not directly spoken on whether federal courts’
jurisdiction is constrained by the local action doctrine, even
though it historically acknowledged the existence of such a
jurisdictional limitation. See Act of May 4, 1858, ch. 27,
11 Stat. 272, 272 (providing, with respect to the service of
process, that “in all cases of a local nature at law or in equity
where the land or other subject-matter of a fixed character
lies partly in one district and partly in another district, within
the same State, the plaintiff may bring his action or suit in the
circuit or district court of either district, and the court . . .
shall have jurisdiction to hear and decide the same . . . as fully
as if the land or other subject-matter were wholly within the
district for which such court is constituted”).
Eldee-K points out that Congress has recently amended
the federal venue statutes to eliminate use of the local action
doctrine in venue decisions. See 28 U.S.C. § 1391(a)(2)
(“Except as otherwise provided by law— . . . the proper
venue for a civil action shall be determined without regard to
whether the action is local or transitory in nature.”). While
§ 1391(a)(2) is not directly applicable here because Eldee-K’s
action was filed before its effective date of January 6, 2012,
Pub. L. No. 112-63, § 205, 125 Stat. 758, 764–65, Eldee-K
argues that if Congress has concluded that the local action
12 ELDEE-K RENTAL PROPERTIES V. DIRECTV
doctrine does not affect a federal court’s venue, a fortiori the
doctrine should not affect a federal court’s jurisdiction.
Although such an inference is reasonable, inference alone is
insufficient to overrule Supreme Court precedent. Venue and
subject matter jurisdiction are distinct concepts, and
Congress’s rejection of the local action doctrine in the venue
context does not overrule the Supreme Court’s prior
determination that the local action doctrine is jurisdictional.
We are bound by Ellenwood until either the Supreme Court
rules otherwise, Agostini v. Felton, 521 U.S. 203, 237 (1997),
or Congress enacts an applicable jurisdictional statute.
B
Because California law governs whether this action is
local or transitory in nature, see Huntington v. Attrill,
146 U.S. 657, 669–70 (1892), we now review California’s
law on this issue.
Like most states, California adopted the common law
distinction between local and transitory actions. See Ophir
Silver Mining Co. v. Super. Ct., 147 Cal. 467, 474 (1905)
(“We could not . . . without disregarding the law which we
have made for ourselves, as well as the long course of
decisions in England and the United States, hold that an
action for damages to realty situated in the state of Nevada
can be maintained in the courts of California.”). Indeed, from
1851, during the earliest days of its statehood, California
limited its courts to hearing local actions that arose “in the
county in which the subject of the action or some part thereof,
is situated, subject to the power of the court to change the
place of trial.” Henry J. LaBatt, The California Practice Act
33, 39–41 (2d ed. 1858) (providing the text of section 18 of
“An act to regulate proceedings in civil cases in the courts of
ELDEE-K RENTAL PROPERTIES V. DIRECTV 13
justice in this state,” commonly known as the Practice Act,
which passed on April 29, 1851). About 28 years later,
California enshrined the local action doctrine in its state
constitution, requiring “that all actions for recovery of the
possession of, quieting the title to, or for the enforcement of
liens upon real estate, shall be commenced in the county in
which the real estate, or any part thereof, affected by such
action or actions is situated.” Cal. Const. Art. VI, § 5 (1879).
California has retained a version of section 18 of the Practice
Act to this day, see Cal. Civ. Proc. Code § 392,3 although it
repealed the constitutional provision in 1966.
California courts drew on common law concepts to
determine which sorts of actions were local in nature for
purposes of implementing these provisions. See, e.g., Samuel
v. Allen, 98 Cal. 406, 407–08 (1893) (relying on common law
principles that an action for damages from breach of a
mortgage contract is an action for money due, and “is not
therefore a local action”); Le Breton v. Super. Ct., 66 Cal. 27,
29–30 (1884) (adopting the common law principle that an
action against a trustee to enforce a trust on real property is
not local).
Under California law, there are three broad categories of
local actions: (1) actions to recover or determine rights or
interests in real property; (2) actions to remedy injuries to real
3
Section 392 currently treats as local actions “(1) [f]or the recovery of
real property, or of an estate or interest therein, or for the determination in
any form, of that right or interest, and for injuries to real property” and
“(2) [f]or the foreclosure of all liens and mortgages on real property.” Cal.
Civ. Proc. Code § 392.
An earlier version of section 392 also deemed local actions “[f]or the
partition of real property.” Cal. Civ. Proc. Code § 392 (1872).
14 ELDEE-K RENTAL PROPERTIES V. DIRECTV
property; and (3) actions to foreclose on liens and mortgages
on real property. See Cal. Civ. Proc. Code § 392(a); see also
Grocers’ Fruit Growing Union v. Kern Cnty. Land Co.,
150 Cal. 466, 472–73 (1907) (concluding that an action for
the specific performance of a contract to convey land was “an
action for the determination of a right or interest in real
property” and thus local); Ophir, 147 Cal. at 476 (holding that
an action to enjoin injuries to real property through trespasses
was local). All other actions are transitory. See Golden
Cross Mining & Milling Co. v. Spiers, 115 Cal. 247, 250
(1896).
To determine whether a particular action relates to real
property and thus is local, California courts assess “the
allegations of the complaint” and “the nature of the judgment
which might be rendered thereon, assuming the truth of the
allegations.” Neet v. Holmes, 19 Cal. 2d 605, 607 (1942); see
also Ophir, 147 Cal. at 476–77. In conducting this analysis,
California courts look to the substance of the lawsuit rather
than how the plaintiff framed the causes of action in the
complaint. See Ophir, 147 Cal. at 473–77. In Strosnider v.
Pomin, for instance, plaintiff sought to quiet title to an
easement over real property owned by the defendants while
also seeking damages for fraudulent misrepresentation,
because the defendants had previously induced the plaintiff
to drop a prior quiet title action by falsely offering to let him
use that easement. See 32 Cal. App. 2d 103, 104–05 (1939).
According to the defendants, because the fraudulent
misrepresentation claim was transitory, the entire suit should
have been brought in the county where they resided, instead
of the county where the property at issue was located. Id. at
106–07. The court disagreed. After reviewing the complaint
as a whole, the court concluded that the substance of the
complaint was for injury to the plaintiff’s real property, even
ELDEE-K RENTAL PROPERTIES V. DIRECTV 15
though the second cause of action was framed as one for
fraudulent misrepresentation. Id. at 108. The court reasoned
that the gravamen of the plaintiff’s complaint was the
defendants’ obstruction of his right of way, “which resulted
from the dismissal of the prior action through the fraud of
defendants.” Id. Therefore, the entire action was local. Id.
at 110.
Eldee-K argues that we should not rely on the cases
explicating California’s local action doctrine as set forth in
section 392 of the California Code of Civil Procedure,
because that statute relates to venue, not to jurisdiction. We
disagree. Both section 392 and the cases interpreting this
statute provide California’s views regarding the sort of
actions that are local in nature. Section 392 codified then-
existing common law principles, see Ophir, 147 Cal. at 474;
see also Cal. Civ. Code § 22.2 (“The common law of
England, so far as it is not repugnant to or inconsistent with
the Constitution of the United States, or the Constitution or
laws of this State, is the rule of decision in all the courts of
this State.”), and the state judicial decisions interpreting the
statutory definition of local actions provide further guidance
on California’s views. The local actions listed in section 392
(e.g., actions directly affecting the title to real property or
involving injury to real property) are consistent with the
common law local action doctrine. See, e.g., Ellenwood, 158
U.S. at 107 (“By the law of England, and of those states of
the Union whose jurisprudence is based upon the common
law, an action for trespass upon land, like an action to recover
the title or the possession of the land itself, is a local action
and can only be brought within the state in which the land
lies.”); Huntington, 146 U.S. at 669 (referring to actions
involving “the rights of real property, the subject being fixed
and immovable” as local). Accordingly, we are bound by
16 ELDEE-K RENTAL PROPERTIES V. DIRECTV
California’s views, as explicated in both case law and statute,
as to when an action constitutes a local action for purposes of
considering our jurisdiction. See Huntington, 146 U.S. at
669.
Eldee-K also argues that because we are bound by
California’s determination as to the nature of an action
(whether local or transitory), we are also bound by
California’s determination that the local action doctrine is a
venue provision, and that state courts may transfer local
actions to other courts within the state. Cal. Civ. Proc. Code
§ 392(a). In other words, Eldee-K contends that because
California treats the local action doctrine as a venue
provision, we should do the same. Again we disagree.
California’s procedural rules have no effect on our analysis
of our own subject matter jurisdiction, which is purely a
question of federal law. See Kontrick, 540 U.S. at 452(recognizing that only Congress may define the lower federal
courts’ subject matter jurisdiction). We look to state law only
for a determination of which types of actions are deemed to
be local in nature, but state law does not control the effect of
such a determination on our jurisdiction.
III
With these principles in mind, we now turn to the
question whether, under California law, Eldee-K’s complaint
is a local action relating to real property in Connecticut. To
determine whether the substance of the action relates to real
property, we consider the allegations of the complaint and the
relief sought.
The nature of Eldee-K’s complaint turns on whether its
claim under California’s unfair competition law (UCL) is
ELDEE-K RENTAL PROPERTIES V. DIRECTV 17
local or transitory.4 Section 17200 of the California Business
and Professions Code prohibits “unfair competition,” which
it defines to include, in relevant part, “any unlawful, unfair or
fraudulent business act or practice.” Eldee-K seeks an
injunction under section 17203, which provides that “[a]ny
person who engages, has engaged, or proposes to engage in
unfair competition may be enjoined in [a] court of competent
jurisdiction.” Cal. Bus. & Prof. Code § 17203. To maintain
a claim under section 17203, Eldee-K must show it “has
suffered injury in fact and has lost money or property as a
result of the unfair competition.” Id. § 17204.
We consider both the complaint’s allegations and the
relief sought. See Neet, 19 Cal. 2d at 607; Ophir, 147 Cal. at
477. The allegations in support of Eldee-K’s UCL claim
reveal that the substance of the claim relates to real property.
First, the complaint alleges that the common questions of law
and fact for purposes of establishing a class action include the
question “[w]hether DIRECTV’s installation and
maintenance of Equipment at Plaintiff’s and Class members’
[multiple dwelling units] upon receipt of Part 2 of the
DIRECTV Installation Form violates” the UCL. In Count I
of the complaint, Eldee-K alleges that DIRECTV violated the
UCL by adopting practices “with the purpose and effect of
enabling the illegal installation of the Equipment in and on
the [multiple dwelling units] of Plaintiff and members of the
class.” Further, the complaint alleges that the injury suffered
by Eldee-K is the “unauthorized use of common or restricted
areas of [its] property.” Finally, the complaint alleges that
DIRECTV’s actions are inconsistent with California Penal
4
Although Eldee-K concedes that its negligence claims are local,
California would treat its entire action as transitory if its unfair
competition claim is transitory. Smith v. Smith, 88 Cal. 572, 576 (1891).
18 ELDEE-K RENTAL PROPERTIES V. DIRECTV
Code § 602(m), which criminalizes trespasses committed by
a person “[e]ntering and occupying real property” without the
owner’s consent. Each of these allegations is based on an
injury to the plaintiff’s real property by DIRECTV’s
unauthorized trespass on its apartment building’s common
areas, cf. Ophir, 147 Cal. at 476–77; Strosnider, 32 Cal. App.
2d at 108, and therefore the allegations demonstrate that the
substance of Eldee-K’s UCL claim relates to real property.
The relief sought by the complaint further supports the
conclusion that the substance of Eldee-K’s UCL claim is to
remedy a trespass to land. Through its UCL claim, Eldee-K
seeks injunctive and other equitable relief to enjoin
DIRECTV from using Part 2 of the installation form, because
absent such relief “DIRECTV will continue to engage in
some or all of these unfair acts.” Cf. Ophir, 147 Cal. at 477.
Reading the complaint as a whole, the substance of the unfair
acts alleged in the complaint is DIRECTV’s trespass on
Eldee-K’s real property. Accordingly, the relief sought is in
substance an injunction against further trespass, which
confirms that Eldee-K’s UCL claim is local. See id.Eldee-K argues that its UCL claim is transitory, not local,
because the gravamen of the claim is that “DIRECTV
‘engages, has engaged, or proposes to engage in unfair
competition’ on its nationwide policy of accepting sham
consents through its installation form,” which Eldee-K seeks
to enjoin. Eldee-K thus views “the unfairness” of
DIRECTV’s alleged policy, rather than its trespass on Eldee-
K property, to be the focus of its UCL claim. Eldee-K
contends that the injury to real property is “merely incidental”
to its UCL claim and does not render the complaint as a
whole local.
ELDEE-K RENTAL PROPERTIES V. DIRECTV 19
We disagree. To have standing to challenge DIRECTV’s
policy, Eldee-K had to allege a loss of money or property.
See Cal. Bus. & Prof. Code § 17204 (permitting an action
under the UCL to be brought “by a person who has suffered
injury in fact and has lost money or property as a result of the
unfair competition”). The only injury Eldee-K has pointed to
that was caused by DIRECTV’s use of Part 2 of its
installation form is the alleged injury to Eldee-K’s real
property through the unauthorized installation of equipment.
Although a direct competitor of DIRECTV could conceivably
claim an injury stemming from DIRECTV’s policy of using
Part 2 of the installation form (on the ground, for example,
that such a policy provides an unfair competitive advantage
to DIRECTV), Eldee-K cannot point to any such injury.
Because the only injury Eldee-K claims to have suffered is a
trespass on its real property, the harm to its real property is
not merely incidental to its UCL claim. See Strosnider,
32 Cal. App. 2d at 108 (holding that a fraud claim was local
when the only damages alleged to have been suffered
stemmed from an “injur[y] [to] the real property of
plaintiff”).
Taken together, Eldee-K’s allegations and the relief
sought in its complaint indicate that the essence of Eldee-K’s
UCL claim is a trespass, which is a local action under
California law. Eldee-K has conceded that its two negligence
claims are also local, and therefore its entire action is local in
nature. Because the real property at issue is in Connecticut,
the district court here lacked subject matter jurisdiction to
adjudicate Eldee-K’s action. See Ellenwood, 158 U.S. at 108.
AFFIRMED.