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COURT OF APPEAL, FOURTH APPELLATE DISTRICT - page 4 / 29

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alleged defendant committed unfair and illegal practices in instances where a vehicle was not redeemed before 72 hours from the time of its initial storage, by improperly charging vehicle owners fees for lien sale preparations without first requesting certain information from the California Department of Motor Vehicles (DMV).  Plaintiff sought restitution and disgorgement of improperly obtained fees, as well as injunctive relief.     

Defendant demurred to plaintiff's first amended complaint.  It argued plaintiff failed to state facts sufficient to state causes of action, and further, the court lacked subject matter jurisdiction.  As to the first, second and third causes of action, defendant argued the court lacked subject matter jurisdiction because the statute on which these claims were based, section 22658, subdivision (i)(2), limiting storage fees that may be charged by towing services, was preempted by the Federal Aviation Administration Authorization Act of 1994 (the FAAAA), title 49 United States Code (U.S.C.) sections 14501 et seq.2  As to the fourth cause of action, defendant argued section 22851.12 was preempted by the FAAAA, and additionally that plaintiff had no standing because it was not charged lien sale preparation fees.  Finally defendant argued, in view of the preemption by federal law, the first amended complaint lacked the legal and factual support for a permanent injunction.

2 Defendant raised the preemption issue somewhat indirectly as to its fraud cause of action.  Specifically, defendant argued plaintiff could not state a cause of action for fraud because there was no "valid" statute prohibiting a towing company from charging two days storage fees within a 24-hour period.  Defendant additionally argued plaintiff could not allege justifiable reliance because plaintiff was operating a "sting" operation and therefore was aware of the wrongfulness of the defendant's statements about the propriety of its charges.   

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