BILL NUMBER: SB 1150 CHAPTERED
BILL TEXT
CHAPTER 197
FILED WITH SECRETARY OF STATE JULY 27, 2004
APPROVED BY GOVERNOR JULY 27, 2004
PASSED THE SENATE JULY 12, 2004
PASSED THE ASSEMBLY JULY 1, 2004
AMENDED IN ASSEMBLY JUNE 24, 2004
AMENDED IN SENATE APRIL 22, 2004
AMENDED IN SENATE APRIL 14, 2004
INTRODUCED BY Senator Burton
JANUARY 26, 2004
An act to add Chapter 4 (commencing with Section 14700) to
Division 6 of the Business and Professions Code, relating to lenders.
LEGISLATIVE COUNSEL'S DIGEST
SB 1150, Burton. Lender names.
Existing law, the Trademark Law, provides for the registration of
a trademark with the Secretary of State. Under existing law, the
owner of a registered mark may bring a civil action for the
unauthorized use of the mark.
This bill would prohibit the inclusion of the trade name, logo,
or tagline of a lender, as defined, in a written solicitation for
financial services directed to a consumer, subject to specified
exceptions. The bill would prohibit the use of the name of a lender,
or the use of a similar name, in a solicitation for financial
services directed to a consumer. The bill would also prohibit the
inclusion of certain loan information of a consumer in a solicitation
for services or products, subject to specified exceptions. The bill
would authorize the recovery of actual damages and would authorize
injunctive relief for a violation of these provisions. The bill
would authorize the prevailing party in an action to recover costs
and reasonable attorney's fees as determined by the court.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 4 (commencing with Section 14700) is added to
Division 6 of the Business and Professions Code, to read:
CHAPTER 4. SOLICITATIONS FOR FINANCIAL SERVICES
14700. (a) "Lender" as used in this chapter means a bank, savings
and loan association, savings bank, credit union, industrial bank,
or other lender licensed to make loans in California or a subsidiary
or an affiliate of one of those entities.
(b) "Financial services" as used in this chapter means financial
services or products that are considered to be financial in nature as
described in Section 1843(k) of Title 12 of the United States Code.
14701. (a) No person shall include the name, trade name, logo, or
tagline of a lender in a written solicitation for financial services
directed to a consumer who has obtained a loan from the lender
without the consent of the lender, unless the solicitation clearly
and conspicuously states that the person is not sponsored by or
affiliated with the lender and that the solicitation is not
authorized by the lender, which shall be identified by name. This
statement shall be made in close proximity to, and in the same or
larger font size as, the first and the most prominent use or uses of
the name, trade name, logo, or tagline in the solicitation, including
on an envelope or through an envelope window containing the
solicitation.
(b) No person shall use the name of a lender or a name similar to
that of a lender in a solicitation for financial services directed to
consumers if that use could cause a reasonable person to be
confused, mistaken, or deceived initially or otherwise as to either
of the following:
(1) The lender's sponsorship, affiliation, connection, or
association with the person using the name.
(2) The lender's approval or endorsement of the person using the
name or the person's services or products.
14702. No person shall include a consumer's loan number or loan
amount, whether or not publicly available, in a solicitation for
services or products without the consent of the consumer, unless the
solicitation clearly and conspicuously states, when applicable, that
the person is not sponsored by or affiliated with the lender and that
the solicitation is not authorized by the lender, and states that
the consumer's loan information was not provided to that person by
that lender. This statement shall be made in close proximity to, and
in the same or larger font as, the first and the most prominent use
or uses of the consumer's loan information in the solicitation,
including on an envelope or through an envelope window containing the
solicitation.
14703. It is not a violation of this chapter for a person in an
advertisement or solicitation for services or products to use the
name, trade name, logo, or tagline of a lender without the statement
described in subdivision (a) of Section 14701 if that use is
exclusively part of a comparison of like services or products in
which the person clearly and conspicuously identifies itself or that
otherwise constitutes nominative fair use. Nothing in this chapter
shall be deemed or interpreted to alter or modify the trade name and
trademark laws of this state, including Chapter 2 (commencing with
Section 14200) and Chapter 3 (commencing with Section 14400).
14704. (a) A person who violates Section 14701 or 14702 shall be
subject to an injunction against that use. In an action to enjoin a
violation of subdivision (a) of Section 14701 or Section 14702, it
is not necessary to allege or to prove actual damage to the
plaintiff, and irreparable harm and interim harm to the plaintiff
shall be presumed. In the action to enjoin a violation of
subdivision (b) of Section 14701, affidavits that show consumers
were confused, mistaken, or deceived as to a matter described in
subdivision (b) of Section 14701 is prima facie evidence of damage
and injury to the plaintiff. In addition to injunctive relief, the
plaintiff is entitled to recover in the action the amount of the
actual damages, if any, it sustained.
(b) The prevailing party in an action brought under this chapter
is entitled to recover its costs and reasonable attorney's fees as
the court may determine.