CHULA VISTA, Calif. (February 21, 2012)– Following a ruling by Superior Court Judge Richard E. L. Strauss dismissing a recent challenge from the City of Chula Vista, a trial date has been set for a class action suit seeking millions of dollars in restitution for allegedly illegal utility taxes levied by the City on cell phone users within its boundaries.
The lawsuit stems from a now outdated tax — levied on users of telephones, electricity and other utilities – which was introduced in 1970 and generates more than $9 million in revenue for the city each year. An attempt by the City to amend the law with Proposition H in 2010 was defeated by voters.
According to Thomas D. Penfield, a partner with San Diego-based Casey Gerry and co-lead counsel, the City of Chula Vista recently filed a legal objection to the suit — technically known as a demurrer — which challenged the sufficiency of complaint. “The City cited its local ordinance which said you cannot file a class action for a tax refund,” said Penfield. In their briefs, Penfield and co-counsel James Capretz of Orange County-based Capretz & Associates argued that municipalities are not permitted to enact their own patchwork means of claiming tax refunds. “The judge agreed with our argument and ruled in our favor – stating that state procedure overrules the local ordinance,” Penfield explained.
According to Capretz, the case is now set to go to trial January 18, 2013. “This is about a flagrant violation of the law and disrespect for the will of the people,” he said. Ultimately, “the City of Chula Vista’s illegal taxing of its citizens shows a dangerous disrespect for the law.”
“Through this class action, we seek a refund for back taxes unlawfully collected over the years,” Penfield added. “Chula Vista taxpayers are entitled to a refund of all utility users taxes (UUTs) improperly collected for the maximum period permissible, along with all other relief provided by law.”
The City of Chula Vista – the second largest City in San Diego County — is taxing without authority, Penfield said. “The tax on cell phones is illegal, as the law introducing it was passed before the invention of cell phones,” he said. Moreover, “the UUT is automatically added to the monthly charges and embedded in detailed billing statements, so most tax payers are not even aware of the tax. The monies collected were siphoned from the local economy and belong to the cell phone using residents of Chula Vista, and in all fairness, should be returned,” said Penfield. “That’s what fair and responsible representatives would do.”
About Casey Gerry
San Diego’s oldest plaintiff’s law firm, Casey Gerry was founded in 1947, and since then has worked to help recover hundreds of millions of dollars for families and individuals who have suffered serious injury or lost loved ones. The firm’s 13 attorneys practice in numerous areas, including asbestos, personal injury, product liability and pharmaceutical litigation. Located at 110 Laurel St. in the Banker’s Hill neighborhood of San Diego, the firm also has a satellite office in Carlsbad, Calif. For more information, call (619) 238-1811 or visit the website at www.caseygerry.com.
About Capretz & Associates
James T. Capretz is the principal of the Newport Beach law firm of Capretz & Associates, a firm that emphasizes complex civil and multidistrict litigation in its practice. He is consistently listed in the Martindale-Hubbell Bar Registry of Preeminent Lawyers. He was the only attorney in private practice named in the initial publication of the top 50 most influential business people in Orange County by the Orange County Business Journal. He has held positions of responsibility in federal class action lawsuits across the United States. He is a charter member of the prestigious Santa Monica-based RAND Institute for the Civil Justice, So Cal 50 Executive Committee. His contact number is 949-724-3000 and website is www.capretz.com. His firm is primarily involved in mass tort litigation over defective pharmaceutical drug and medical devices, consumer protection law, public law and class actions. The firm represents clients across the US and globally.