A fast food restaurant gift card holder stated, in part, a California Unfair Competition Law (UCL) class action claim against McDonald’s Corporation for failing to redeem a gift card for cash, as required by the California gift certificate law, according to the federal district court in San Diego.

The gift card holder received a McDonald’s gift card for $5 and attempted to redeem the gift card for cash. Based on McDonald’s refusal to redeem the gift card, the gift card holder asserted a causes of action under the UCL. The gift card holder also alleged that McDonald’s used deceptive and misleading language on the back of the gift cards concerning the right to redeem in violation of the UCL.

McDonald’s motion to dismiss the UCL claim based on the refusal to redeem the gift card was dismissed because the gift hard holder had standing. The UCL claim was based on McDonald’s alleged violation of California Civil Code 1749.5(b)(2), which provides that any gift certificate with a cash value of less than ten dollars is redeemable in cash for its cash value. The gift card holder sufficiently alleged standing to assert the UCL claim based on the alleged violation of the Civil Code. Therefore, the UCL claim based on the refusal to redeem the gift card was not dismissed.

The gift card holder failed to state a claim for violation of the UCL based on the allegedly deceptive and misleading language on the gift card, according to the court. In order to state a UCL claim, the gift card holder needed to show that he relied on the language to his detriment. Because there was no evidence that the gift card holder relied on the language at issue, the court dismissed the UCL claim based on the gift card language.

 (The above feature is selected from the newsletter published monthly along with full text documents and other materials provided to subscribers of the State Unfair Trade Practices Law.)