In an action initiated by respondent attorney general, the Superior Court of Los Angeles County, California, found appellant life insurance company had engaged in deceptive business practices in connection with the sale of certain annuity policies. The trial court imposed civil penalties, granted injunctive relief, and required the insurance company to offer restitution. The insurance company appealed.
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The life insurance company contended that the $ 2.5 million in civil penalties imposed against it for violations of Cal. Bus. & Prof. Code § 17200 et seq., the "unfair competition law," should be reversed as an abuse of discretion and a violation of constitutional due process; the restitution provisions were improper because not all consumers were harmed by the violations; and that the restitution order constituted an excessive, double punishment. The court disagreed. Imposition of civil penalties for the insurance company's transgressions was mandatory. Cal. Bus. & Prof. Code §§ 17206, 17536. Cal. Bus. & Prof. Code § 17535 armed the court with the cleansing power to order restitution to effect complete justice. An actuary experienced in analyzing annuity contracts testified he was not able to fully understand the premium charge, thus supporting the findings that the annuity policy was "misleading and deceptive." Restitution could be ordered without individualized proof of harm. The order did not constitute an excessive double punishment.
Outcome
The judgment was affirmed.