Amended in Senate January 4, 2016

Amended in Senate March 16, 2015

Senate BillNo. 202


Introduced by Senator Hernandez

February 10, 2015


An act to amend Sectionbegin delete 1770 of the Civil Code,end deletebegin insert 11357.5 of the Health and Safety Code,end insert relating to controlled substances.

LEGISLATIVE COUNSEL’S DIGEST

SB 202, as amended, Hernandez. Controlled substances:begin delete unfair or deceptive practices.end deletebegin insert Synthetic cannabinoids.end insert

Existing law makes it a misdemeanor to sell, dispense, distribute, furnish, administer, or give, or offer to sell, dispense, distribute, furnish, administer, or give, or possess for sale, any synthetic stimulant compound or any specified synthetic stimulant derivative. Existing law also makes it a misdemeanor to sell, dispense, distribute, furnish, administer, or give, or offer to sell, dispense, distribute, furnish, administer, or give, or possess for sale, any synthetic cannabinoid compound or any synthetic cannabinoidbegin delete derivative.end deletebegin insert derivative, as defined.end insert Existingbegin delete law, beginning January 1, 2016,end deletebegin insert lawend insert makes it an infraction to use or possess those drugs.

begin delete

Existing law, the Consumers Legal Remedies Act, makes unlawful certain acts identified as unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods to any consumer. Existing law, among other remedies, authorizes consumer class action lawsuits and injunctive relief for alleged violations of the act and provides for senior citizens and disabled persons to receive an award of punitive damages and attorney’s fees, as specified, for successful actions brought under these provisions.

end delete
begin delete

This bill would add to that list of unlawful acts the act of advertising or offering for sale products that contain synthetic cannabinoids or synthetic stimulants, as defined.

end delete
begin insert

This bill would authorize the California State Board of Pharmacy to determine, upon adoption of a regulation, that additional substances are synthetic cannabinoid compounds, according to specified criteria. The bill would require the board to fund that activity by moneys appropriated by the Legislature. This bill would deem the adoption of regulations to add substances to the definition of “synthetic cannabinoid compound” an emergency. By expanding the definition of a crime, this bill would impose a state-mandated local program.

end insert
begin insert

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end insert
begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert

Vote: majority. Appropriation: no. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: begin deleteno end deletebegin insertyesend insert.

The people of the State of California do enact as follows:

P2    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 11357.5 of the end insertbegin insertHealth and Safety Codeend insertbegin insert,
2as added by Section 2 of Chapter 372 of the Statutes of 2014, is
3amended to read:end insert

4

11357.5.  

(a) Every person who sells, dispenses, distributes,
5furnishes, administers, or gives, or offers to sell, dispense,
6distribute, furnish, administer, or give, or possesses for sale any
7synthetic cannabinoid compound, or any synthetic cannabinoid
8derivative, to any person, is guilty of a misdemeanor, punishable
9by imprisonment in a county jail not to exceed six months, or by
10a fine not to exceed one thousand dollars ($1,000), or by both that
11fine and imprisonment.

12(b) Every person who uses or possesses any synthetic
13cannabinoid compound, or any synthetic cannabinoid derivative,
14is guilty of an infraction, punishable by a fine not to exceed two
15hundred fifty dollars ($250).

P3    1(c) As used in this section, the term “synthetic cannabinoid
2compound” refers to any of the following substances:

3(1) 1-pentyl-3-(1-naphthoyl)indole (JWH-018).

4(2) 1-butyl-3-(1-naphthoyl)indole (JWH-073).

5(3) 1-[2-(4-morpholinyl)ethyl]-3-(1-naphthoyl)indole
6(JWH-200).

7(4) 5-(1,1-dimethylheptyl)-2-[(1R,3S)-3-hydroxycyclohexyl]-phenol
8(CP-47,497).

9(5) 5-(1,1-dimethyloctyl)-2-[(1R,3S)-3-hydroxycyclohexyl]-phenol
10(cannabicyclohexanol; CP-47,497 C8 homologue).

begin delete

11(d) This section shall become operative on January 1, 2016.

end delete
begin insert

12(6) (A) The California State Board of Pharmacy may include
13any other substance as a synthetic cannabinoid compound
14prohibited by this section upon adoption of a regulation. In
15determining if a substance shall be included as a synthetic
16cannabinoid compound, the California State Board of Pharmacy
17shall consider:

end insert
begin insert

18(i) The substance’s actual or relative potential for abuse.

end insert
begin insert

19(ii) Scientific evidence of the substance’s pharmacological effect,
20if known.

end insert
begin insert

21(iii) The state of current scientific knowledge regarding the
22substance.

end insert
begin insert

23(iv) The substance’s history and current pattern of abuse.

end insert
begin insert

24(v) The scope, duration, and significance of abuse of the
25substance.

end insert
begin insert

26(vi) The risk to public health caused by the substance.

end insert
begin insert

27(vii) The substance’s potential to produce psychological or
28physiological dependence.

end insert
begin insert

29(viii) Whether the substance is an immediate precursor of a
30substance already included in this subdivision.

end insert
begin insert

31(ix) The substance’s similarity to other substances already
32considered synthetic cannabinoid compounds under this
33subdivision.

end insert
begin insert

34(B) The board may adopt emergency regulations pursuant to
35this paragraph. The adoption of regulations pursuant to this
36paragraph shall be deemed to be an emergency and necessary for
37the immediate preservation of the public peace, health, safety, or
38general welfare. The emergency regulations authorized by this
39paragraph are exempt from review by the Office of Administrative
40Law. The emergency regulations authorized by this paragraph
P4    1shall be submitted to the Office of Administrative Law for filing
2with the Secretary of State and shall remain in effect until the
3earlier of 180 days following their effective date or the effective
4date of regulations adopted pursuant to subparagraph (A).

end insert
begin insert

5(C) The board shall fund the activities authorized by this
6paragraph by moneys appropriated by the Legislature.

end insert
7begin insert

begin insertSEC. 2.end insert  

end insert
begin insert

No reimbursement is required by this act pursuant to
8Section 6 of Article XIII B of the California Constitution because
9the only costs that may be incurred by a local agency or school
10district will be incurred because this act creates a new crime or
11infraction, eliminates a crime or infraction, or changes the penalty
12for a crime or infraction, within the meaning of Section 17556 of
13the Government Code, or changes the definition of a crime within
14the meaning of Section 6 of Article XIII B of the California
15Constitution.

end insert
begin delete
16

SECTION 1.  

Section 1770 of the Civil Code is amended to
17read:

18

1770.  

(a) The following unfair methods of competition and
19unfair or deceptive acts or practices undertaken by any person in
20a transaction intended to result or which results in the sale or lease
21of goods or services to any consumer are unlawful:

22(1) Passing off goods or services as those of another.

23(2) Misrepresenting the source, sponsorship, approval, or
24certification of goods or services.

25(3) Misrepresenting the affiliation, connection, or association
26with, or certification by, another.

27(4) Using deceptive representations or designations of
28geographic origin in connection with goods or services.

29(5) Representing that goods or services have sponsorship,
30approval, characteristics, ingredients, uses, benefits, or quantities
31which they do not have or that a person has a sponsorship,
32approval, status, affiliation, or connection which he or she does
33not have.

34(6) Representing that goods are original or new if they have
35deteriorated unreasonably or are altered, reconditioned, reclaimed,
36used, or secondhand.

37(7) Representing that goods or services are of a particular
38standard, quality, or grade, or that goods are of a particular style
39or model, if they are of another.

P5    1(8) Disparaging the goods, services, or business of another by
2false or misleading representation of fact.

3(9) Advertising goods or services with intent not to sell them
4as advertised.

5(10) Advertising goods or services with intent not to supply
6reasonably expectable demand, unless the advertisement discloses
7a limitation of quantity.

8(11) Advertising furniture without clearly indicating that it is
9unassembled if that is the case.

10(12) Advertising the price of unassembled furniture without
11clearly indicating the assembled price of that furniture if the same
12furniture is available assembled from the seller.

13(13) Making false or misleading statements of fact concerning
14reasons for, existence of, or amounts of price reductions.

15(14) Representing that a transaction confers or involves rights,
16remedies, or obligations which it does not have or involve, or
17which are prohibited by law.

18(15) Representing that a part, replacement, or repair service is
19needed when it is not.

20(16) Representing that the subject of a transaction has been
21supplied in accordance with a previous representation when it has
22not.

23(17) Representing that the consumer will receive a rebate,
24discount, or other economic benefit, if the earning of the benefit
25is contingent on an event to occur subsequent to the consummation
26of the transaction.

27(18) Misrepresenting the authority of a salesperson,
28representative, or agent to negotiate the final terms of a transaction
29with a consumer.

30(19) Inserting an unconscionable provision in the contract.

31(20) Advertising that a product is being offered at a specific
32price plus a specific percentage of that price unless (A) the total
33price is set forth in the advertisement, which may include, but is
34not limited to, shelf tags, displays, and media advertising, in a size
35larger than any other price in that advertisement, and (B) the
36specific price plus a specific percentage of that price represents a
37markup from the seller’s costs or from the wholesale price of the
38product. This subdivision shall not apply to in-store advertising
39by businesses which are open only to members or cooperative
40organizations organized pursuant to Division 3 (commencing with
P6    1Section 12000) of Title 1 of the Corporations Code where more
2than 50 percent of purchases are made at the specific price set forth
3in the advertisement.

4(21) Selling or leasing goods in violation of Chapter 4
5(commencing with Section 1797.8) of Title 1.7.

6(22) (A) Disseminating an unsolicited prerecorded message by
7telephone without an unrecorded, natural voice first informing the
8person answering the telephone of the name of the caller or the
9organization being represented, and either the address or the
10telephone number of the caller, and without obtaining the consent
11of that person to listen to the prerecorded message.

12(B) This subdivision does not apply to a message disseminated
13to a business associate, customer, or other person having an
14established relationship with the person or organization making
15the call, to a call for the purpose of collecting an existing
16obligation, or to any call generated at the request of the recipient.

17(23) The home solicitation, as defined in subdivision (h) of
18Section 1761, of a consumer who is a senior citizen where a loan
19is made encumbering the primary residence of that consumer for
20the purposes of paying for home improvements and where the
21transaction is part of a pattern or practice in violation of either
22subsection (h) or (i) of Section 1639 of Title 15 of the United States
23Code or paragraph (e) of Section 226.32 of Title 12 of the Code
24of Federal Regulations.

25A third party shall not be liable under this subdivision unless
26(A) there was an agency relationship between the party who
27engaged in home solicitation and the third party or (B) the third
28party had actual knowledge of, or participated in, the unfair or
29deceptive transaction. A third party who is a holder in due course
30under a home solicitation transaction shall not be liable under this
31subdivision.

32(24) (A) Charging or receiving an unreasonable fee to prepare,
33aid, or advise any prospective applicant, applicant, or recipient in
34the procurement, maintenance, or securing of public social services.

35(B) For purposes of this paragraph, the following definitions
36shall apply:

37(i) “Public social services” means those activities and functions
38of state and local government administered or supervised by the
39State Department of Health Care Services, the State Department
40of Public Health, or the State Department of Social Services, and
P7    1involved in providing aid or services, or both, including health
2care services, and medical assistance, to those persons who,
3because of their economic circumstances or social condition, are
4in need of that aid or those services and may benefit from them.

5(ii) “Public social services” also includes activities and functions
6administered or supervised by the United States Department of
7Veterans Affairs or the California Department of Veterans Affairs
8involved in providing aid or services, or both, to veterans, including
9pension benefits.

10(iii) “Unreasonable fee” means a fee that is exorbitant and
11disproportionate to the services performed. Factors to be
12considered, when appropriate, in determining the reasonableness
13of a fee, are based on the circumstances existing at the time of the
14service and shall include, but not be limited to, all of the following:

15(I) The time and effort required.

16(II) The novelty and difficulty of the services.

17(III) The skill required to perform the services.

18(IV) The nature and length of the professional relationship.

19(V) The experience, reputation, and ability of the person
20providing the services.

21(C) This paragraph shall not apply to attorneys licensed to
22practice law in California, who are subject to the California Rules
23of Professional Conduct and to the mandatory fee arbitration
24provisions of Article 13 (commencing with Section 6200) of
25Chapter 4 of Division 3 of the Business and Professions Code,
26when the fees charged or received are for providing representation
27in administrative agency appeal proceedings or court proceedings
28for purposes of procuring, maintaining, or securing public social
29services on behalf of a person or group of persons.

30(25) (A) Advertising or promoting any event, presentation,
31seminar, workshop, or other public gathering regarding veterans’
32benefits or entitlements that does not include the following
33statement in the same type size and font as the term “veteran” or
34any variation of that term:

35(i) “I am not authorized to file an initial application for Veterans’
36Aid and Attendance benefits on your behalf, or to represent you
37before the Board of Veterans’ Appeals within the United States
38Department of Veterans Affairs in any proceeding on any matter,
39including an application for such benefits. It would be illegal for
40me to accept a fee for preparing that application on your behalf.”
P8    1The requirements of this clause do not apply to a person licensed
2to act as an agent or attorney in proceedings before the Agency of
3Original Jurisdiction and the Board of Veterans’ Appeals within
4the United States Department of Veterans Affairs when that person
5is offering those services at the advertised event.

6(ii) The statement in clause (i) shall also be disseminated, both
7orally and in writing, at the beginning of any event, presentation,
8seminar, workshop, or public gathering regarding veterans’ benefits
9or entitlements.

10(B) Advertising or promoting any event, presentation, seminar,
11workshop, or other public gathering regarding veterans’ benefits
12or entitlements which is not sponsored by, or affiliated with, the
13United States Department of Veterans Affairs, the California
14Department of Veterans Affairs, or any other congressionally
15chartered or recognized organization of honorably discharged
16members of the Armed Forces of the United States, or any of their
17auxiliaries that does not include the following statement, in the
18same type size and font as the term “veteran” or the variation of
19that term:


21“This event is not sponsored by, or affiliated with, the United
22States Department of Veterans Affairs, the California Department
23of Veterans Affairs, or any other congressionally chartered or
24recognized organization of honorably discharged members of the
25Armed Forces of the United States, or any of their auxiliaries.
26None of the insurance products promoted at this sales event are
27endorsed by those organizations, all of which offer free advice to
28veterans about how to qualify and apply for benefits.”
29


30(i) The statement in this subparagraph shall be disseminated,
31both orally and in writing, at the beginning of any event,
32presentation, seminar, workshop, or public gathering regarding
33veterans’ benefits or entitlements.

34(ii) The requirements of this subparagraph shall not apply in a
35case where the United States Department of Veterans Affairs, the
36California Department of Veterans Affairs, or other congressionally
37chartered or recognized organization of honorably discharged
38members of the Armed Forces of the United States, or any of their
39auxiliaries have granted written permission to the advertiser or
40promoter for the use of its name, symbol, or insignia to advertise
P9    1or promote the event, presentation, seminar, workshop, or other
2public gathering.

3(26) Representing that a product is made in California by using
4a Made in California label created pursuant to Section 12098.10
5of the Government Code, unless the product complies with Section
612098.10 of the Government Code.

7(27) Advertising, distributing, or selling a product for use by a
8consumer that contains synthetic cannabinoids, as defined in
9Section 11357.5 of the Health and Safety Code, or synthetic
10stimulants, as defined in Section 11375.5 of the Health and Safety
11Code.

12(b) (1) It is an unfair or deceptive act or practice for a mortgage
13broker or lender, directly or indirectly, to use a home improvement
14contractor to negotiate the terms of any loan that is secured,
15whether in whole or in part, by the residence of the borrower and
16which is used to finance a home improvement contract or any
17portion thereof. For purposes of this subdivision, “mortgage broker
18or lender” includes a finance lender licensed pursuant to the
19California Finance Lenders Law (Division 9 (commencing with
20Section 22000) of the Financial Code), a residential mortgage
21lender licensed pursuant to the California Residential Mortgage
22Lending Act (Division 20 (commencing with Section 50000) of
23the Financial Code), or a real estate broker licensed under the Real
24Estate Law (Division 4 (commencing with Section 10000) of the
25Business and Professions Code).

26(2) This section shall not be construed to either authorize or
27prohibit a home improvement contractor from referring a consumer
28to a mortgage broker or lender by this subdivision. However, a
29home improvement contractor may refer a consumer to a mortgage
30lender or broker if that referral does not violate Section 7157 of
31the Business and Professions Code or any other provision of law.
32A mortgage lender or broker may purchase an executed home
33improvement contract if that purchase does not violate Section
347157 of the Business and Professions Code or any other provision
35of law. Nothing in this paragraph shall have any effect on the
36application of Chapter 1 (commencing with Section 1801) of Title
372 to a home improvement transaction or the financing thereof.

end delete


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