text:
(a) The California Tax Education Council, as defined in subdivision (d) of Section 22251, shall carry out the responsibilities and duties set forth in this chapter.

(b) Protection of the public shall be the highest priority for the council in exercising its registration and disciplinary authority, and any other functions. Whenever the protection of the public is inconsistent with other interests sought to be promoted, the protection of the public shall be paramount.

(c) The council shall be governed by a board of directors comprised of the following:

(1) Not more than one representative from each California nonprofit corporation in good standing that chooses to participate in the council and that represents tax preparers, enrolled agents, attorneys, or certified public accountants with a membership in California of at least 400 in each of the previous three calendar years.

(2) Not more than one representative from each for-profit tax preparation corporation in good standing that chooses to participate in the council and that had at least 400 employees or franchisees, which number can include the employees of a franchisee, in California during the previous calendar year and that has been operating in California for the last three years.

(3) Six individuals who are tax preparers pursuant to Section 22255 and are appointed through a process established by the council to the board of directors with full voting privileges to serve terms as determined by the council, with their initial terms being served on a staggered basis. A person exempt from the requirements of this chapter pursuant to Section 22258 is not eligible for appointment to the council, other than an employee of an individual in an exempt category.

(d) The meetings of the board of directors shall be subject to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code). The board of directors may adopt additional policies and procedures that provide greater transparency to registrants and the public than required by the Bagley-Keene Open Meeting Act.

(e) The council may take any reasonable actions to carry out the responsibilities and duties set forth in this chapter, including, but not limited to, hiring staff and entering into contracts.

(f) The council shall issue registrations, deny applications, and discipline registrants as authorized by this chapter. The council may adopt bylaws, rules, regulations, and procedures necessary to effectuate the purposes of this chapter.

(g) The council shall establish application fees, renewal fees, delinquent fees, and other fees related to the regulatory cost of providing services and carrying out the council’s responsibilities and duties pursuant to this chapter. These fees shall not exceed the reasonable cost to the council of providing those services and carrying out those responsibilities and duties.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 4. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


kind: section

code: BPC

text:
(a) The council shall issue a registration to any applicant who provides satisfactory evidence that he or she meets all of the requirements of this chapter and who complies with the bylaws, rules, and procedures established by the council.

(b) In order to obtain a registration, an applicant shall submit a written application in a form provided by the council and provide the council with satisfactory evidence that he or she meets all of the following requirements:

(1) The applicant has successfully completed the educational requirements described in subdivision (a) of Section 22255.

(2) The applicant has successfully passed a background investigation pursuant to Section 22253.5.

(3) All fees required by the council as described in subdivision (c) of Section 22251.2 have been paid.

(4) The applicant meets all of the other requirements for registration in this chapter.

(c) Any registration under this chapter shall be subject to renewal every year in a manner prescribed by the council, and shall expire unless renewed in that manner. The council may provide for the late renewal of a registration.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 5. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)

division: 8. SPECIAL BUSINESS REGULATIONS

chapter: 14. Tax Preparers

path: 8. SPECIAL BUSINESS REGULATIONS > 14. Tax Preparers


text:
(a) The council shall establish and maintain on its Internet Web site a searchable public registry of registrants. Each registrant’s listing shall clearly indicate whether the registrant is actively in compliance with the annual registration requirements and shall include any of the following information that is applicable to the registrant:

(1) The registrant’s name and mailing address.

(2) The registrant’s California Tax Education Council registration number.

(3) Any other information the council believes would be beneficial to consumers of tax preparation services that is consistent with protecting the public pursuant to subdivision (b) of Section 22251.2.

(b) The Internet Web site of the council shall contain direct links to the Internet Web sites maintained by the California Board of Accountancy, the State Bar of California, and the Internal Revenue Service where public information regarding tax preparers exempt from this chapter may be obtained.

history: (History: Added by Stats. 2018, Ch. 597, Sec. 6. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
Prior to rendering any tax preparation services, a tax preparer shall provide the customer in writing with the following:

(a) The tax preparer’s name, address, and telephone number.

(b) Evidence of compliance with the bonding requirement of Section 22250.1, including the bond number, if any.

(c) The address of the Internet Web site of the council.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 7. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) No confidential information obtained by a tax preparer, in his or her professional capacity, concerning a client or a prospective client shall be disclosed by the tax preparer without the written permission of the client or prospective client, except for the following:

(1) Disclosures made by a tax preparer in compliance with a subpoena or a summons enforceable by order of a court.

(2) Disclosures made by a tax preparer regarding a client or prospective client to the extent the tax preparer reasonably believes it is necessary to maintain or defend himself or herself in a legal proceeding initiated by the client or prospective client.

(3) Disclosures made by a tax preparer in response to an official inquiry from a federal or state government regulatory agency.

(4) Disclosures made by a tax preparer or to a tax preparer’s duly authorized representative to another tax preparer in connection with a proposed sale or merger of the tax preparer’s professional practice.

(5) Disclosures made by a tax preparer to either of the following:

(A) Another tax preparer to the extent necessary for purposes of professional consultation.

(B) Organizations that provide professional standards review and ethics or quality control peer review.

(6) Disclosures made when specifically required by law.

(b) In the event that confidential client information may be disclosed to persons or entities outside the United States of America in connection with the services provided, the tax preparer shall inform the client in writing and obtain the client’s written permission for the disclosure.

(c) It is the intent of the Legislature that this section complement and does not replace Section 17530.5 as applied to tax preparers by subdivision (f) of Section 1799.1a of the Civil Code.

history: (History: Added by Stats. 2004, Ch. 921, Sec. 16. Effective January 1, 2005. Repealed as of January 1, 2028, pursuant to Section 22259.)


text: The Legislature finds and declares that it is important to inform taxpayers that they may make voluntary contributions to certain funds or programs, as provided on the state income tax return. The Legislature further finds and declares that many taxpayers remain unaware of the voluntary contribution check-offs on the state income tax return. Therefore, it is the intent of the Legislature to encourage all persons who prepare state income tax returns, including tax preparers, to inform their clients in writing, prior to the completion of any state income tax return, that they may make a contribution to any voluntary contribution check-off on the state income tax return if they so choose.

history: (History: Amended by Stats. 1998, Ch. 485, Sec. 33. Effective January 1, 1999. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) It is a violation of this chapter for a tax preparer to do or commit, and the council may deny an application for registration or discipline a registrant for, any of the following:

(1) Fail to register as a tax preparer with the council.

(2) Make, or authorize the making of, any statement or representation, oral or written or recorded by any means, which is intended to induce persons to use the tax preparation service of the tax preparer, which statement or representation is fraudulent, untrue, or misleading.

(3) Obtain the signature of a customer to a tax return or authorizing document which contains blank spaces to be filled in after it has been signed.

(4) Fail or refuse to give a customer, for his or her own records, a copy of any document requiring the customer’s signature, within a reasonable time after the customer signs the document.

(5) Fail to maintain a copy of any tax return prepared for a customer for four years from the date of completion or the due date of the return, whichever is later.

(6) Engage in advertising practices which are fraudulent, untrue, or misleading, including, but not limited to, assertions that the bond required by Section 22250.1 in any way implies licensure or endorsement of a tax preparer by the State of California.

(7) Violate Section 17530.5.

(8) Violate Section 7216 of Title 26 of the United States Code.

(9) Fail to sign a customer’s tax return when payment for services rendered has been made.

(10) Fail to return, upon the demand by or on behalf of a customer, records or other data provided to the tax preparer by the customer.

(11) Knowingly give false or misleading information to the consumer pursuant to Section 22252, or give false or misleading information to the surety company pursuant to subdivision (a) of Section 22250.1, or give false or misleading information to the California Tax Education Council pursuant to Section 22255.

(12) Commit unprofessional conduct, including, but not limited to, denial of licensure, certificate, permit, or registration, or revocation, suspension, restriction, or any other disciplinary action against an applicant or registrant by the federal government or another state or territory of the United States, by any other government agency, or by another professional licensing board or organization. A certified copy of the decision, order, or judgment shall be conclusive evidence of these actions.

(13) Procure or attempt to procure a registration by fraud, misrepresentation, or mistake.

(14) Violate or attempt to violate, directly or indirectly, or assist in or abet the violation of, or conspire to violate, any provision or term of this chapter or any rule or bylaw adopted by the council.

(15) Be convicted of any felony or misdemeanor that is substantially related to the qualifications, functions, or duties of a registrant, in which event the record of the conviction shall be conclusive evidence of the crime.

(16) Impersonate an applicant or act as a proxy for an applicant in any situation or examination referred to under this chapter for the issuance of a registration.

(17) Impersonate a registrant, or permit or allow an unregistered person to use a registration.

(18) Commit any fraudulent, dishonest, or corrupt act that is substantially related to the qualifications, functions, or duties of a registrant.

(b) Each violation of this section constitutes a separate offense.

(c) A violation of paragraphs (12) to (18), inclusive, of subdivision (a) is not subject to subdivision (b) of Section 22256.

(d) The council may enter into an agreement with the Franchise Tax Board to provide reimbursement to the Franchise Tax Board for assistance in carrying out enforcement activities consistent with this chapter.

(e) Beginning July 1, 2019, the council shall post the following on its Internet Web site:

(1) All disciplinary actions taken against registrants by the council, including, but not limited to, misconduct that resulted in a suspension or revocation.

(2) A list of registrants on probation, including the misconduct that resulted in the probation and any terms of probation.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 8. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) Any tax preparer who advertises the availability of a refund anticipation loan shall not directly or indirectly represent the loan as a client’s actual refund. Any advertisement that mentions a refund anticipation loan shall state conspicuously that it is a loan and that a fee or interest will be charged by the lending institution. The advertisement shall also disclose the name of the lending institution.

(b) Every tax preparer who offers to facilitate, or who facilitates, a refund anticipation loan to a client shall display a refund anticipation loan schedule showing the current fees for refund anticipation loans facilitated at the office, for the electronic filing of the client’s tax return, for setting up a refund account, and any other related activities necessary to receive a refund anticipation loan. The fee schedule shall also include a statement indicating that the client may have the tax return filed electronically without also obtaining a refund anticipation loan.

(c) The postings required by this section shall be made in not less than 28-point type on a document measuring not less than 16 by 20 inches. The postings required in this section shall be displayed in a prominent location at each office where any tax preparer is offering to facilitate or facilitating a refund anticipation loan.

(d) (1) Prior to the client’s completion of the refund anticipation loan application, a tax preparer that offers to facilitate a refund anticipation loan shall provide to the client a clear, written disclosure containing all of the following information:

(A) The refund anticipation loan fee schedule.

(B) That a refund anticipation loan is a loan and is not the client’s actual income tax refund.

(C) That the taxpayer can file an income tax return electronically without applying for a refund anticipation loan.

(D) The average amount of time, according to the Internal Revenue Service, within which a taxpayer who does not obtain a refund anticipation loan can expect to receive a refund if the taxpayer’s return is filed or mailed as follows:

(i) Filed electronically and the refund is deposited directly into the taxpayer’s bank account or mailed to the taxpayer.

(ii) Mailed to the Internal Revenue Service and the refund is deposited directly into the taxpayer’s bank account or mailed to the taxpayer.

(E) That the Internal Revenue Service does not guarantee that it will pay the full amount of the anticipated refund and it does not guarantee a specific date that a refund will be deposited into the taxpayer’s bank account or mailed to the taxpayer.

(F) That the client is responsible for the repayment of the refund anticipation loan and the related fees in the event that the tax refund is not paid or paid in full.

(G) The estimated time within which the loan proceeds will be paid to the client if the loan is approved.

(H) The fee that will be charged, if any, if the client’s loan is not approved.

(2) Prior to the client’s consummation of the refund anticipation loan transaction, a tax preparer that facilitates a refund anticipation loan shall provide to the client, in either written or electronic form, the following information:

(A) The estimated total fees for obtaining the refund anticipation loan.

(B) The estimated annual percentage rate for the client’s refund anticipation loan, using the guidelines established under the federal Truth in Lending Act (15 U.S.C. Sec. 1601 and following).

(C) A comparison of the various costs, fees, and finance charges, if applicable, associated with receiving a refund by mail or by direct deposit directly from the Internal Revenue Service, a refund anticipation loan, a refund anticipation check, or any other refund settlement options facilitated by the tax preparation service.

(e) This section shall comply with the language requirements set forth in Section 1632 of the Civil Code.

(f) Any tax preparer who offers to facilitate, or who facilitates, a refund anticipation loan may not engage in any of the following activities:

(1) Requiring a client to enter into a loan arrangement in order to complete a tax return.

(2) Misrepresenting a material factor or condition of a refund anticipation loan.

(3) Failing to process the application for a refund anticipation loan promptly after the client applies for the loan.

(4) Engaging in any transaction, practice, or course of business that operates a fraud upon any person in connection with a refund anticipation loan.

history: (History: Added by Stats. 2005, Ch. 396, Sec. 2. Effective January 1, 2006. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) The Franchise Tax Board shall notify the California Tax Education Council when it identifies an individual who has violated paragraph (1) of subdivision (a) of Section 22253.

(b) Upon receiving the notice described in subdivision (a), the California Tax Education Council may notify the Attorney General, a district attorney, or a city attorney of the violation. Upon receiving this notice, the Attorney General, a district attorney, or a city attorney may do any of the following:

(1) Cite individuals preparing tax returns in violation of subdivision (a) of Section 22253.

(2) Levy a fine up to five thousand dollars ($5,000) per violation.

(3) Issue a cease and desist order, which shall remain in effect until the individual has complied with paragraph (1) of subdivision (a) of Section 22253.

(c) The California Tax Education Council may enter into an agreement with the Franchise Tax Board to provide reimbursement to the Franchise Tax Board for any expenses incurred by the Franchise Tax Board to implement subdivision (a) of this section.

history: (History: Amended by Stats. 2011, Ch. 432, Sec. 34. (SB 944) Effective January 1, 2012. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) The council may discipline a registrant by any, or a combination, of the following methods:

(1) Placing the registration on probation.

(2) Suspending the registration and the rights conferred by this chapter on a registrant for a period not to exceed one year.

(3) Revoking the registration.

(4) Suspending or staying the disciplinary order, or portions of it, with or without conditions.

(5) Taking other action as the council, as authorized by this chapter or its bylaws, rules, or procedures, deems proper.

(b) The council may issue an initial registration on probation, with specific terms and conditions, to any applicant.

(c) If a registration is suspended or revoked, the council shall notify the Franchise Tax Board and the Internal Revenue Service.

history: (History: Added by Stats. 2013, Ch. 660, Sec. 7. (SB 484) Effective January 1, 2014. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) No registrant or applicant may be disciplined or denied registration except according to procedures satisfying the requirements of this section. A denial or discipline not in accord with this section shall be void and without effect.

(b) Any application denial or registrant discipline shall be done in good faith and in a fair and reasonable manner. Any procedures that conform to the requirements of this chapter are fair and reasonable, but a court may also find other procedures to be fair and reasonable when the full circumstances of the application denial or registrant discipline are considered.

(c) A procedure is fair and reasonable if all of the following apply:

(1) It provides the giving of 15 days prior notice of the application denial or registration discipline and the reasons therefor.

(2) It provides an opportunity for the applicant or registrant to be heard, either orally or in writing, not less than five days before the effective date of the application denial or registrant discipline by a person or body authorized to decide that the proposed application denial or registrant discipline not take place.

(d) Any notice required under this section may be given by any method reasonably calculated to provide actual notice. Any notice given by mail must be given by first-class or express mail sent to the last address of the applicant or registrant shown on the council’s records.

(e) Any action challenging an application denial or registrant discipline, including any claim alleging defective notice, shall be commenced within one year after the effective date of the application denial or registrant discipline in the superior court in and for the county of the council’s principal place of business. If the action is successful, the court may order any relief, including reinstatement, that it finds equitable under the circumstances.

(f) The council may charge applicants and registrants a reasonable regulatory fee as a condition of any hearing requested by the applicant or registrant for the purpose of contesting denial of a registration or discipline of a registrant. This fee shall not exceed the reasonable cost to the council of providing the hearing. Upon a favorable judgment for the council in any proceeding, the council shall be entitled to recover its reasonable attorney’s fees.

(g) This section governs only the procedures for application denial or registrant discipline and not the substantive grounds therefor. An application denial or registrant discipline based upon substantive grounds that violates contractual or other rights of the applicant or registrant or is otherwise unlawful is not made valid by compliance with this section.

history: (History: Added by Stats. 2013, Ch. 660, Sec. 8. (SB 484) Effective January 1, 2014. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) Beginning July 1, 2020, as a condition of registration, the council shall require the applicant to submit fingerprint images as directed by the council and in a form consistent with the requirements of this section.

(b) The council shall submit the fingerprint images and related information to the Department of Justice for the purpose of obtaining information as to the existence and nature of a record of state- and federal-level convictions and of state- and federal-level arrests for which the Department of Justice establishes that the applicant was released on bail or on his or her own recognizance pending trial.

(c) Requests for federal-level criminal offender record information received by the Department of Justice pursuant to this section shall be forwarded to the Federal Bureau of Investigation by the Department of Justice. The Department of Justice shall review the information returned from the Federal Bureau of Investigation, and shall compile and disseminate a fitness determination regarding the applicant. The Department of Justice shall provide information to the council pursuant to subdivision (p) of Section 11105 of the Penal Code.

(d) The Department of Justice and the council shall charge a fee sufficient to cover the cost of processing the request for state- and federal-level criminal offender record information.

(e) The council shall request subsequent arrest notification service from the Department of Justice, as provided under Section 11105.2 of the Penal Code, for all applicants for registration for whom fingerprint images and related information are submitted to conduct a search for state- and federal-level criminal offender record information.

(f) The council may receive arrest notifications and other background materials about applicants and registrants from a city, county, or city and county.

history: (History: Added by Stats. 2018, Ch. 597, Sec. 10. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text: A provider of tax preparer education for tax preparers shall meet standards and procedures as approved by the council. The council shall either approve or decline to approve providers of tax preparer education within 120 days of receiving a request for approval. If approval is not declined within 120 days, the provider shall be deemed approved. A listing of those providers approved by the council shall be made available to tax preparers upon request.

history: (History: Amended by Stats. 2001, Ch. 728, Sec. 67.4. Effective January 1, 2002. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) The council shall issue a “certificate of completion,” as part of the education registration requirements described in Section 22251.3, to the tax preparer when the tax preparer demonstrates that he or she has (1) completed not less than 60 hours of instruction in basic personal income tax law, theory, and practice by an approved curriculum provider within the previous 18 months; and (2) provides evidence of compliance with the bonding requirement of Section 22250.1, including the name of the surety company, the bond number, and the bond expiration date. Of the required 60 hours, 45 hours shall be concerned with federal tax curriculum and 15 hours shall be concerned with state tax curriculum.

(b) A tax preparer shall complete on an annual basis not less than 20 hours of continuing education, including 15 hours in federal taxation and 5 hours in California taxation from an approved curriculum provider. The council shall issue annually a “statement of compliance” when the tax preparer demonstrates that he or she has (1) completed the required 20 hours of continuing education, and (2) provides evidence of compliance with the bonding requirement of Section 22250.1, including the name of the surety company, the bond number, and the bond expiration date.

(c) An individual who possesses a minimum of two recent years’ experience in the preparation of personal income tax returns may petition the council to review the experience and determine if it is the equivalent of the required qualifying education described in subdivision (a). The council may provide that individual with a “certificate of completion” if it is determined that the experience is the equivalent of the required hours. Tax preparation performed in situations that violate this chapter, by an individual who is neither registered nor exempted, may not be used toward the qualifying experience needed for registration as a tax preparer.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 11. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) The superior court in and for the county in which any person acts as a tax preparer in violation of the provisions of this chapter, may, upon a petition by any person, issue an injunction or other appropriate order restraining the conduct. The proceedings under this paragraph shall be governed by Chapter 3 (commencing with Section 525) of Title 7 of Part 2 of the Code of Civil Procedure.

(b) Except as provided in paragraphs (12) to (18), inclusive, of subdivision (a) of Section 22253, a person who violates a provision of this chapter is guilty of a misdemeanor, which offense is punishable by a fine not exceeding one thousand dollars ($1,000), or by imprisonment in a county jail for not more than one year, or by both.

history: (History: Amended by Stats. 2018, Ch. 597, Sec. 12. (AB 3143) Effective January 1, 2019. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) If a tax preparer fails to perform a duty specifically imposed upon him or her pursuant to this chapter, any person may maintain an action for enforcement of those duties or to recover a civil penalty in the amount of one thousand dollars ($1,000), or for both enforcement and recovery.

(b) In an action to enforce these duties or to recover civil penalties, or for both enforcement and recovery, the prevailing plaintiff shall be entitled to reasonable attorney’s fees and costs, in addition to the civil penalties provided under subdivision (a).

history: (History: Added by Stats. 1996, Ch. 1137, Sec. 51. Effective January 1, 1997. Operative July 1, 1997, by Sec. 54 of Ch. 1137. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) The following persons are exempt from the requirements of this title, subject to the requirements of subdivision (b):

(1) An individual with a current and valid license issued by the California Board of Accountancy, or authorized to practice public accountancy pursuant to Article 5.1 (commencing with Section 5096) of Chapter 1 of Division 3.

(2) A firm, including the firm’s partners, shareholders, owners, or employees, provided the firm has a current and valid license issued by the California Board of Accountancy.

(3) A person who is an active member of the State Bar of California.

(4) Any trust company or trust business as defined in Chapter 1 (commencing with Section 99) of Division 1 of the Financial Code.

(5) A financial institution regulated by the state or federal government, insofar as the activities of the financial institution with respect to tax preparation are subject to federal or state examination or oversight.

(6) A person who is enrolled to practice before the Internal Revenue Service pursuant to Subpart A (commencing with Section 10.1) of Part 10 of Title 31 of the Code of Federal Regulations.

(7) Any employee of any person described in paragraph (1), (2), (3), (4), (5), or (6), while functioning within the scope of that employment, insofar that the employee is supervised by a person exempt under this subdivision who reviews the return, signs it, and is responsible for its content.

(8) Any employee of any corporation, partnership, association, or any entity described in subparagraph (B) of paragraph (1) of subdivision (a) of Section 22251.

(b) (1) Except for employees of entities described in paragraph (4) or (5) of subdivision (a), paragraph (7) of subdivision (a) shall apply only if all tax returns prepared by that employee are signed by a person described in paragraph (1), (2), (3), or (6) of subdivision (a).

(2) Paragraph (8) of subdivision (a) shall apply only if all tax returns prepared by that employee are signed by the person described in paragraph (8) of subdivision (a).

(3) No person described in this subdivision as an employee may sign a tax return, unless that employee is otherwise exempt under this section, is registered as a tax preparer with the council, or is an employee of either a trust company or trust business described in paragraph (4) of subdivision (a), or any employee of a financial institution described in paragraph (5) of subdivision (a).

(c) For purposes of this section, preparation of a tax return includes the inputting of tax data into a computer.

(d) The amendments made to this section by the act adding this subdivision shall apply to tax returns prepared for taxable years beginning on or after January 1, 2025.

history: (History: Amended by Stats. 2025, Ch. 329, Sec. 1. (SB 788) Effective January 1, 2026. Repealed as of January 1, 2028, pursuant to Section 22259.)


text:
(a) This chapter shall be subject to review by the appropriate policy committees of the Legislature.

(b) This chapter shall remain in effect only until January 1, 2028, and as of that date is repealed.

history: (History: Amended by Stats. 2023, Ch. 185, Sec. 1. (SB 812) Effective January 1, 2024. Repealed as of January 1, 2028, by its own provisions. Note: Repeal affects Chapter 14, commencing with Section 22250.)


text:
No person issuing, selling or offering to sell any passage ticket or any instrument giving or purporting to give any right, either absolutely or upon any condition or contingency, to a passage or conveyance upon any vessel, or a berth or stateroom in any vessel, shall hold himself out to be or advertise himself in any way as the agent of the owner or consignees of such vessel or line, unless he has received authority in writing therefor, specifying the name of the company, line or vessel for which he is authorized to act as agent and the city or other place, together with the street and the street number, in which his office is kept for the sale of tickets, and unless such written authorization is readily available in such office.

This section shall not apply to the sale of passage tickets on board any such vessel or to the offices of the actual owners or consignees of such vessel.

history: (History: Added by Stats. 1965, Ch. 1224.)

chapter: 15. Passage Tickets

path: 8. SPECIAL BUSINESS REGULATIONS > 15. Passage Tickets


text: No person issuing, selling or offering to sell or holding himself out as being authorized to sell any such passage ticket or instrument giving or purporting to give any such right to passage or conveyance shall give or cause to be given any false or misleading information or shall print, publish, distribute or circulate or cause to be printed, published, distributed or circulated any false or misleading advertisement, circular, circular letter, pamphlet, card, handbill or other printed paper or notice in regard to the passage, ticket or instrument or the passage or voyage to which it entitles or purports to entitle its owner, purchaser or holder or line over which, or the vessel for which such passage is sold or offered or as to his agency for such line or vessel.


text: Any person issuing, selling, or offering to sell any passenger ticket for passage or conveyance aboard any foreign vessel, including the owner or consignee of such vessel, his agents, servants, or employees, shall make reference to the country of registry of such vessel and a statement that such vessel is not subject to American safety regulations in any advertisement, circular, circular letter, pamphlet, card, handbill, or other printed paper or notice, written or oral, in regard to the passage, ticket, or instrument, or the passage or voyage to which it entitles or purports to entitle its owner, purchaser, or holder, or line over which, or the vessel for which, such passage is sold or offered, or as to his agency for such line or vessel. The reference and statement shall be prominently displayed.

history: (History: Amended by Stats. 1973, Ch. 1090.)


text: A ticket or instrument issued as evidence of a right of passage upon the high seas, from any port in this state, to any port of any other state or nation, and every certificate or order issued for the purpose, or under pretense of procuring any such ticket or instrument, and every receipt for money paid for such ticket or instrument shall state the name of the vessel on board of which the passage is to be made, the name of the owners or consignees of such vessel, the name of the company, or line, if any, to which such vessel belongs, its country of registry, the place from which such passage is to commence, the place where such passage is to terminate, the day of the month and year upon which the voyage is to commence, the name of the person purchasing such ticket or instrument, or receiving such order, certificate or receipt, and the amount paid therefor; and such ticket or instrument, order, certificate or receipt, unless sold or issued by the owners or consignees of such vessel, shall be signed by their authorized agent.


text: Any person, firm, corporation, partnership, or association or any employee or agent thereof who violates this chapter is guilty of a misdemeanor.


text:
(a) Any natural person who makes more than 10 services of process within this state during one calendar year, for specific compensation or in expectation of specific compensation, where that compensation is directly attributable to the service of process, shall file and maintain a verified certificate of registration as a process server with the county clerk of the county in which he or she resides or has his or her principal place of business. Any corporation or partnership that derives or expects to derive compensation from service of process within this state shall also file and maintain a verified certificate of registration as a process server with the county clerk of the county in which the corporation or partnership has its principal place of business.

(b) This chapter shall not apply to any of the following:

(1) Any sheriff, marshal, or government employee who is acting within the course and scope of his or her employment.

(2) An attorney or his or her employees, when serving process related to cases for which the attorney is providing legal services.

(3) Any person who is specially appointed by a court to serve its process.

(4) A licensed private investigator or his or her employees.

(5) A professional photocopier registered under Section 22450, or an employee thereof, whose only service of process relates to subpoenas for the production of records, which subpoenas specify that the records be copied by that registered professional photocopier.

history: (History: Amended by Stats. 2005, Ch. 300, Sec. 1. Effective January 1, 2006.)

chapter: 16. Process Servers

path: 8. SPECIAL BUSINESS REGULATIONS > 16. Process Servers


text:
(a) The certificate of registration of a registrant who is a natural person shall contain the following:

(1) The name, age, address, email address, and telephone number of the registrant.

(2) A statement, signed by the registrant under penalty of perjury, that the registrant has not been convicted of a felony, or, if the registrant has been convicted of a felony, a copy of a certificate of rehabilitation, expungement, or pardon.

(3) A statement that the registrant has been a resident of this state for a period of one year immediately preceding the filing of the certificate.

(4) A statement that the registrant will perform their duties as a process server in compliance with the provisions of law governing the service of process in this state.

(b) The certificate of registration of a registrant who is a partnership or corporation shall contain the following:

(1) The names, ages, addresses, email addresses, and telephone numbers of the general partners or officers.

(2) A statement, signed by the general partners or officers under penalty of perjury, that the general partners or officers have not been convicted of a felony.

(3) A statement that the partnership or corporation has been organized and existing continuously for a period of one year immediately preceding the filing of the certificate or a responsible managing employee, partner, or officer has been previously registered under this chapter.

(4) A statement that the partnership or corporation will perform its duties as a process server in compliance with the provisions of law governing the service of process in this state.

(c) The county clerk shall retain the certificate of registration for a period of three years following the expiration date of the certificate, after which time the certificate may be destroyed if it is scanned or if the conditions specified in Section 26205.1 of the Government Code are met. If the certificate is scanned, the scanned image shall be retained for a period of 10 years, after which time that image may be destroyed and, notwithstanding Section 26205.1 of the Government Code, no reproduction thereof need be made or preserved.

history: (History: Amended by Stats. 2021, Ch. 376, Sec. 35. (AB 830) Effective January 1, 2022.)


text:
(a) At the time of filing an initial certificate of registration or renewing a certificate of registration that has lapsed, the registrant shall also submit a completed Request for Live Scan form confirming fingerprint submission to the Department of Justice and the Federal Bureau of Investigation, in order to verify that the registrant has not been convicted of a felony. The clerk shall utilize the Subsequent Arrest Notification Contract provided by the Department of Justice for notifications subsequent to the initial certificate of registration.

(b) If, after receiving the results of the Request for Live Scan, the clerk is advised that the registrant has been convicted of a felony, the presiding judge of the superior court of the county in which the certificate of registration is maintained is authorized to review the criminal record and, unless the registrant is able to produce a copy of a certificate of rehabilitation, expungement, or pardon, as specified in paragraph (2) of subdivision (a) of Section 22351, notify the registrant that the registration is revoked. An order to show cause for contempt may be issued and served upon any person who fails to surrender a registered process server identification card after a notice of revocation.

history: (History: Amended by Stats. 2009, Ch. 137, Sec. 1. (AB 1123) Effective January 1, 2010.)


text:
At the time of filing the initial certificate of registration, a registrant shall pay the following fees to the county clerk:

(a) A fee of one hundred dollars ($100).

(b) A fee to cover the actual costs of processing the completed request for live scan when submitted with the initial certificate of registration.

(c) A fee to cover the actual cost of issuing a registered process server identification card.

history: (History: Amended by Stats. 2017, Ch. 573, Sec. 72. (SB 800) Effective January 1, 2018.)


text:
(a) A certificate of registration shall be accompanied by a bond of two thousand dollars ($2,000), executed by an admitted surety insurer and conditioned upon compliance with the provisions of this chapter and all laws governing the service of process in this state. The total aggregate liability on the bond is limited to two thousand dollars ($2,000). As an alternative to the bond, the registrant may deposit with the clerk, cash or a money order in the amount of two thousand dollars ($2,000).

(b) The county clerk shall, upon filing the bond, deliver the bond forthwith to the county recorder for recording. The recording fee specified in Section 27361 of the Government Code shall be paid by the registered process server. The fee may be paid to the county clerk, who shall transmit it to the recorder.

(c) The fee for filing, canceling, revoking, or withdrawing the bond is seven dollars ($7).

(d) The county recorder shall record the bond and any notice of cancellation, revocation, or withdrawal of the bond, and shall thereafter mail the instrument, unless specified to the contrary, to the person named in the instrument and, if no person is named, to the party leaving it for recording. The recording fee specified in Section 27361 of the Government Code for the notice of cancellation, revocation, or withdrawal of the bond shall be paid to the county clerk, who shall transmit it to the county recorder.

history: (History: Amended by Stats. 2002, Ch. 197, Sec. 1. Effective January 1, 2003.)


text: A certificate of registration shall be effective for a period of two years or until the date the bond expires, whichever occurs first. Thereafter, a registrant shall file a new certificate of registration or a renewal of the certificate of registration and pay the fee required by Section 22352. A certificate of registration may be renewed up to 60 days prior to its expiration date and the effective date of the renewal shall be the date the current registration expires. The renewal shall be effective for a period of two years from the effective date or until the expiration date of the bond, whichever occurs first.

history: (History: Amended by Stats. 2001, Ch. 35, Sec. 3. Effective January 1, 2002.)


text:
(a) The county clerk shall maintain a register of process servers and assign a number and issue an identification card to each process server. The county clerk shall issue a temporary identification card, for no additional fee, to applicants who are required to submit Request for Live Scan forms for background checks to the Federal Bureau of Investigation and the Department of Justice. This card shall be valid for 120 days. If clearance is received from the Federal Bureau of Investigation and the Department of Justice within 120 days, the county clerk shall immediately issue a permanent identification card to the applicant. Upon request of the applicant, the permanent identification card shall be mailed to the applicant at the applicant’s address of record. Upon renewal of a certificate of registration, the same number shall be assigned, provided that the applicant is renewing registration in the same county in which the applicant was previously registered and there is no lapse of three or more years in the period of registration.

(b) The temporary and permanent identification cards shall be not less than 314 inches by 2 inches and shall contain at the top the title, “Registered Process Server,” followed by the registrant’s name, address, registration number, date of expiration, and county of registration. In the case of a natural person, it shall also contain a photograph of the registrant in the lower left corner. The identification card for a partnership or corporation registration shall be issued in the name of the partnership or corporation, and shall not contain a photograph.

(c) This section shall remain in effect only until January 1, 2027, and as of that date is repealed.

history: (History: Amended by Stats. 2025, Ch. 563, Sec. 2. (AB 747) Effective January 1, 2026. Repealed as of January 1, 2027, by its own provisions. See later operative version as added by Sec. 3 of Stats. 2025, Ch. 563.)


text:
(a) The county clerk shall maintain a publicly available register of process servers and assign a number and issue an identification card to each process server. The county clerk shall issue a temporary identification card, for no additional fee, to applicants who are required to submit Request for Live Scan forms for background checks to the Federal Bureau of Investigation and the Department of Justice. This card shall be valid for 120 days. If clearance is received from the Federal Bureau of Investigation and the Department of Justice within 120 days, the county clerk shall immediately issue a permanent identification card to the applicant. Upon request of the applicant, the permanent identification card shall be mailed to the applicant at the applicant’s address of record. Upon renewal of a certificate of registration, the same number shall be assigned, provided that the applicant is renewing registration in the same county in which the applicant was previously registered and there is no lapse of three or more years in the period of registration.

(b) The temporary and permanent identification cards shall be not less than 314 inches by 2 inches and shall contain at the top the title, “Registered Process Server,” followed by the registrant’s name, address, registration number, date of expiration, and county of registration. In the case of a natural person, it shall also contain a photograph of the registrant in the lower left corner. The identification card for a partnership or corporation registration shall be issued in the name of the partnership or corporation, and shall not contain a photograph.

(c) This section shall become operative on January 1, 2027.

history: (History: Repealed (in Sec. 2) and added by Stats. 2025, Ch. 563, Sec. 3. (AB 747) Effective January 1, 2026. Operative January 1, 2027, by its own provisions.)


text: A registrant shall be responsible at all times for the good conduct of his or her employees acting within the course or scope of their employment, and any person acting as an independent contractor within the course or scope of the agency relationship with the registrant.

history: (History: Amended by Stats. 1991, Ch. 598, Sec. 2.)


text:
(a) In addition to the information required by subdivision (b) of Section 22360, any proof of service of any process which is signed by an independent contractor of a registrant under this chapter shall indicate that the proof of service was signed as an independent contractor of a registered process server. The proof of service shall indicate the county of registration and the number assigned pursuant to Section 22355 of both the independent contractor and the entity registered under this chapter.

(b) No registrant shall permit any individual to sign any proof of service of any process as an independent contractor unless all of the following conditions are met:

(1) The independent contractor is performing pursuant to a written independent contractor agreement with the registrant.

(2) The independent contractor supplies proof of bonding under Section 22353, if applicable.

(3) The registrant exercises minimal supervision or control over the means of accomplishing the service of any process assigned by the registrant. The registrant may communicate a deadline for the service of process and request notification that such service has been completed.

(4) The registrant imposes no restrictions on the independent contractor’s ability to perform services for others registered under this chapter.

(5) The independent contractor supplies proof that any required business licenses have been obtained.

(c) Persons not meeting the criteria of subdivision (b) shall be treated as employees of the registrant while persons meeting the criteria of subdivision (b) shall be treated as independent contractors.

(d) This section shall not preclude an independent determination of employment under any other provision of law.

history: (History: Amended by Stats. 1997, Ch. 442, Sec. 8. Effective January 1, 1998.)


text:
(a) Any person who recovers damages in any action or proceeding for injuries caused by a service of process which was made by a registrant and did not comply with the provisions of law governing the service of process in this state may recover the amount of the damages from the bond required by Section 22353.

(b) Whenever there has been a recovery against a bond under subdivision (a), the registrant shall file a new bond or cash deposit within 30 days to reinstate the bond or cash deposit to the amount required by Section 22353. If the registrant does not file the bond within 30 days, the certificate of registration shall be revoked and the remainder of the bond forfeited to the county treasury.

history: (History: Amended by Stats. 1999, Ch. 892, Sec. 10. Effective January 1, 2000.)


text:
(a) A certificate of registration may be revoked or suspended whenever it has been determined that the registrant has made a service of process, including service completed by an employee or independent contractor of the registrant, which does not comply with the provisions of law governing the service of process in this state or constitutes an improper service of process not amounting to a violation of law.

(b) An investigation concerning the revocation or suspension of a certificate of registration may be commenced at any time at the option of the county clerk if the county clerk deems it to be appropriate. A complaint by any person who has alleged that he or she has been injured by a service of process shall be investigated by the public prosecutor. The investigation shall determine if the registrant complied with the provisions of law governing the service of process or constituted improper service of process not amounting to a violation of the law.

(c) If the public prosecutor determines from the investigation that cause may exist for the suspension or revocation of the certificate of registration, he or she shall set the matter for hearing and give notice to the registrant. That hearing shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Division 3 of Title 2 of the Government Code except that the decision of the administrative law judge shall be final. For the purposes of those provisions, the public prosecutor shall be deemed to be the agency.

(d) If, after the hearing, the county clerk is notified after the decision has become effective that the administrative law judge has directed that the registrant’s certificate be suspended or revoked, the county clerk shall forthwith suspend or revoke the certificate. If the certificate is revoked, the bond or cash deposit required by Section 22353 shall be forfeited to the county treasury subject to the right of a person to recover against the bond or cash deposit under Section 22357.

history: (History: Amended by Stats. 1991, Ch. 598, Sec. 4.)


text: Any person who violates any of the provisions of this chapter is guilty of a misdemeanor.

history: (History: Added by Stats. 1971, Ch. 1661.)


text: Any proof of service of any process which is signed by a registrant under this chapter shall indicate the county in which he or she is registered and the number assigned to him or her by Section 22355.

history: (History: Amended by Stats. 1997, Ch. 442, Sec. 9. Effective January 1, 1998.)


text:
(a) The Legislature finds that there are in the State of California members of the general public who have ideas or inventions that they believe have substantial commercial value but which members of the general public do not have the resources or expertise necessary to develop, manufacture or market these ideas or inventions; that these members of the general public are commonly referred to as “inventors”; that these inventors are generally not people who earn their livelihood from developing, manufacturing, promoting or marketing ideas or inventions, from manufacturing or marketing products, from publishing literary works or from owning, operating or controlling commercial enterprises; that there is a significant number of persons who have realized that inventors are willing to expend substantial sums for services represented to result in the development, manufacture, promotion, sale or general exploitation of the commercial value of their ideas or inventions; that these persons are frequently known as invention developers; that the invention developers’ services are generally offered for sums ranging from $500 to $5,000 plus either a percentage of the income that may be derived from the sale or marketing of the idea or invention or a partial ownership interest in the idea or invention; that the inventors generally have a very passive role in the development, promotion, manufacture or sale of their ideas or inventions after the contract with the invention developer is executed, usually doing little more than receiving periodic reports from the invention developer; that an extremely small number of inventors to whom these invention developers offer their services ever have their products sold or marketed; that there exists in connection with invention development services, sales practices and business methods which have worked a fraud, deceit, imposition, and financial hardship upon many people of this state; that existing legal protection to consumers is inadequate to prevent these abuses; that the invention development industry has a significant impact upon the economy and well-being of this state and its local communities; and that the provisions of this chapter relating to such services are necessary for the public welfare.

(b) The Legislature declares that the purpose of this chapter is to safeguard the public against fraud, deceit, imposition, and financial hardship, and to foster and encourage competition, fair dealing, and prosperity in the field of invention development services by prohibiting or restricting false or misleading advertising, onerous contract terms, harmful financial practices, and other unfair, dishonest, deceptive, destructive, unscrupulous, fraudulent, and discriminatory practices by which the public has been injured in connection with invention development services but not to interfere with, or further regulate by this chapter, those persons who provide researching, marketing, surveying, or other kinds of consulting services to professional manufacturers, marketers, publishers or others purchasing such services as an adjunct to the traditional commercial enterprises in which they engage as a livelihood.

history: (History: Added by Stats. 1975, Ch. 967.)

article: 1. General Provisions

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 1. General Provisions


text:
As used in this chapter, the following words have the following meanings:

(a) “Contract for invention development services” shall include a contract by which an invention developer undertakes to develop or promote an invention for a customer.

(b) “Customer” shall include any person, firm, corporation, or other entity that is solicited by, inquires about or seeks the services of, or enters into a contract for invention development services with an invention developer, except (1) any department or agency of the federal, state, or local government, (2) any charitable, scientific, educational, religious, or other organization qualified under Section 501(c)(3) or described in Section 170(b)(1)(a) of the Internal Revenue Code of 1954, as amended, and (3) any person, firm, corporation, or other entity regularly engaged in a trade, business, or profession which has either a net worth of one hundred thousand dollars ($100,000) or more or gross receipts from any source of fifty thousand dollars ($50,000) or more during the calendar year in which any contract for invention development services is signed.

(c) “Invention” shall mean (1) an invention, (2) an idea, (3) a concept, or (4) any combination thereof.

(d) “Invention developer” shall mean any person, firm, corporation, or association, and the agents, employees, or representatives of such person, firm, corporation, or association that develops or promotes or offers to develop or promote an invention, except (1) any department or agency of the federal, state, or local government, (2) any charitable, scientific, educational, religious, or other organization qualified under Section 501(c)(3) or described in Section 170(b)(1)(a) of the Internal Revenue of Code of 1954, as amended, (3) any person, firm, corporation, association, or other entity whose gross receipts from contracts for invention development services, as defined in subdivision (a) of Section 22371, do not exceed 10 percent of its gross receipts from all sources during the fiscal year preceding the year in which any contract for invention development services is signed, or (4) any person, firm, corporation, association or other entity that does not charge a fee for invention development services. For the purposes of this paragraph, “fee” shall include any payment made by the customer to such entity including reimbursements for expenditures made or costs incurred by such entity but shall not include any payment made from a portion of the income received by a customer by virtue of invention development services performed by such entity.

(e) “Invention development services” shall include acts required or promised to be performed, or actually performed, or both, by an invention developer for a customer.

chapter: 17. Invention Development Services Contracts

article: 1. General Provisions


text:
(a) Every contract for invention development services shall be in writing and shall be subject to the provisions of this chapter. A copy of the written contract shall be given to the customer at the time he signs the contract.

(b) If one or more subsequent contracts are contemplated by the invention developer in connection with an invention, or if the invention developer contemplates performance of services in connection with an invention in more than one phase with the performance of each phase covered in one or more subsequent contracts, the invention developer shall so state in a writing and shall supply to the customer such writing together with a copy of such contract or a written summary of the general terms of each and every such subsequent contract, including the amount of any fees or other consideration required from the customer, at the time the customer signs the first contract.

article: 2. General Regulatory Provisions

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 2. General Regulatory Provisions


text:
(a) Notwithstanding any contractual provision to the contrary, the invention developer and the customer shall each have the right to cancel a contract for invention development services for any reason at any time within seven days of the date the invention developer and the customer sign the contract. Cancellation shall be effected by written notice mailed or delivered to the invention developer or the customer. If said notice is mailed, it must be postmarked by midnight of the last day of the cancellation period. If the notice is delivered, it must be delivered by the end of the invention developer’s normal business day. Within five business days after receipt of such notice of cancellation by the customer, the invention developer shall return to the customer, by mail, all moneys paid and all materials provided by the customer.

(b) The provisions of subdivision (a) shall apply to every contract executed between an invention developer and a customer. Each such contract shall contain the following statement in 10-point boldface type immediately above the place at which the customer signs the contract:

“The seven-day period during which you may cancel this contract for any reason by mailing or delivering written notice to the invention developer will expire on .(Last date to mail or deliver notice)If you choose to mail your notice, it must be placed in the United States mail properly addressed first-class postage prepaid and postmarked before midnight of this date. If you choose to deliver your notice to the invention developer directly, it must be delivered to him by the end of his normal business day on this date. The invention developer also has the right to cancel this contract by notice similarly mailed or delivered.”

article: 2. General Regulatory Provisions


text:
Each and every contract for invention development services shall carry a distinctive and conspicuous cover sheet with the following notice (and no other) imprinted thereon in boldface type of not less than 10-point size:

“The following disclosures are required by law:

“You have the right to cancel this contract for any reason at any time within seven days from the date you and the invention developer sign the contract and you receive a fully executed copy of it. To exercise this option you need only mail or deliver to this invention developer written notice of your cancellation. The method and time for notification is set forth in this contract immediately above the place for your signature. Upon cancellation, the invention developer must return by mail, within five business days, all money paid and all materials provided by you.

“Your potential patent rights may be adversely affected by any attempt to commercialize your idea or invention before a patent application covering it is filed. Nonconfidential disclosures of your idea or invention may also trigger certain statutory deadlines for filing a patent application in the United States and would prevent you from obtaining valid patent rights in countries whose law provides that patent applications must be filed before there is a public disclosure.

“This contract between you and the invention developer is regulated by law. The invention developer is not qualified or permitted to advise you whether protection of your idea or invention is available under the patent, copyright or trademark laws of the United States or any other law. This contract does not provide any patent, copyright or trademark protection for your idea or invention. If your idea or invention is patentable, copyrightable or subject to trademark protection, or infringes an existing valid patent, copyright or trademark or a patent, copyright or trademark for which application has been made, your failure to inquire into these matters may affect your rights to your idea or invention.”

history: (History: Amended by Stats. 1983, Ch. 332, Sec. 1.)

article: 2. General Regulatory Provisions


text: No invention developer shall acquire any interest, partial or whole, in the title to the customer’s invention, unless the invention developer contracts to manufacture the invention and acquires such interest for such purpose at or about the time the contract for manufacture is executed. Nothing in this section shall be construed to prohibit an invention developer from contracting with a customer to receive a portion of any proceeds accruing to the customer as a result of performance of invention development services by the invention developer.

article: 2. General Regulatory Provisions


text: No contract for invention development services shall require or entail the execution of any note or series of notes by the customer which, when separately negotiated, will cut off as to third parties any right of action or defense which the customer may have against the invention developer.

article: 2. General Regulatory Provisions


text: Any assignee of the invention developer’s rights is subject to all equities and defenses of the customer against the invention developer existing in favor of the customer at the time of the assignment.

article: 2. General Regulatory Provisions


text: With respect to each and every contract for invention development services, the invention developer shall deliver to the customer, at the address specified in the contract at quarterly intervals throughout the term of the contract, a written statement of the services performed to date; provided, however, the first such statement need not be delivered until 180 days after the contract is executed.

article: 2. General Regulatory Provisions


text:
Every contract for invention development services shall set forth in at least 10-point boldface type, or equivalent size if handwritten, all of the following:

(a) The terms and conditions of payment required by Section 22373.

(b) A full and detailed description of the acts or services that the invention developer undertakes to perform for the customer. To the extent that the description of acts or services affords the invention developer discretion to decide what acts or services are to be performed by the invention developer, the invention developer shall exercise that discretion to promote the best interests of the customer.

(c) A statement whether the invention developer undertakes to construct one or more prototypes, models, or devices embodying the customer’s invention.

(d) A statement whether the invention developer undertakes to sell or distribute one or more prototypes, models, or devices embodying the customer’s invention.

(e) The name of the person or firm contracting to perform the invention development services, the name under which said person or firm is doing or has done business as an invention developer, and the name of any parent, subsidiary or affiliated company that may engage in performing the invention development services.

(f) The invention developer’s principal business address and the name and address of its agent in the State of California authorized to receive service of process.

(g) The business form of the invention developer, whether corporate, partnership, or otherwise.

(h) A statement of the fee charged, a statement that a portion of the fee charged will be paid as a commmission or other similar payment, if in fact it is intended to be so paid, to a person inducing, directly or indirectly, a customer to contract for the services of the invention developer, which statement shall specify the names of the person or persons receiving said payment; and a statement of the approximate portion of the fee charged, if any, that will be expended for services relating to patent matters.

(i) A statement that the invention developer does not intend to expend more for the invention development services than the fee charged the customer, if, in fact, it does not, and if it does, a statement of the estimated expenditures of the invention developer in excess of the fee received from the customer.

(j) If any oral or written representation of estimated or projected customer earnings is made, a statement of such estimation or projection and the data upon which it is based.

(k) A single statement setting forth both (1) the total number of customers who have contracted with the invention developer provided, however, that the number need not reflect those customers who have contracted within the last 30 days, and (2) the number of customers that have received, by virtue of the invention developer’s performance of invention development services, an amount of money in excess of the amount of money paid by such customers to the invention developer.

(l) A statement that the invention developer is required to maintain all records and correspondence relating to performance of the invention development services for that customer for a period not less than three years after expiration of the term of the contract for invention development services.

(m) The name and address of the custodian of all records and correspondence relating to the performance of the invention development services.

(n) A statement that the records and correspondence required to be maintained by subdivision (m) above will be made available to the customer or his representative for review and copying at the customer’s expense on the invention developer’s premises during normal business hours upon seven days’ written notice, said time period to begin from the date the notice is placed in the United States mail properly addressed first-class postage prepaid.

(o) A statement of the expected date of completion of the invention development services.

(p) A statement as follows:

“Your potential patent rights may be adversely affected by any attempt to commercialize your idea or invention before a patent application covering it is filed. Nonconfidential disclosures of your idea or invention may also trigger certain statutory deadlines for filing a patent application in the United States and would prevent you from obtaining valid patent rights in countries whose law provides that patent applications must be filed before there is a public disclosure.

“This contract between you and the invention developer is regulated by law. The invention developer is not qualified or permitted to advise you whether protection of your idea or invention is available under the patent, copyright or trademark laws of the United States or any other law. This contract does not provide any patent, copyright or trademark protection for your idea or invention. If your idea or invention is patentable, copyrightable or subject to trademark protection, or infringes an existing valid patent, copyright or trademark or a patent, copyright or trademark for which application has been made, your failure to inquire into these matters may affect your rights to your idea or invention.”

history: (History: Amended by Stats. 1983, Ch. 332, Sec. 2.)

article: 3. Mandatory Contract Terms

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 3. Mandatory Contract Terms


text: Every invention developer who charges a fee or requires any consideration for his invention development services must clearly and conspicuously disclose such fact in every advertisement of such services.

article: 4. Disclosures Made Prior to Contract

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 4. Disclosures Made Prior to Contract


text:
In the first oral communication with a customer or in the first written response to an inquiry by a customer other than an oral communication or written response, the primary purpose of which is to arrange an appointment with the invention developer for presentation of his or her invention development services, the invention developer shall cause the following written disclosures to be made and given to each customer at the time of the disclosure:

(a) A statement of the fee charged, if known, or a statement of the approximate range of fees charged; a statement that a portion of the fee charged will be paid as a commission or other similar payment, if in fact it is intended to be so paid, to a person inducing, directly or indirectly, a customer to contract for the services of the invention developer; and a statement of the approximate portion of the fee charged, if any, that will be expended for services relating to patent matters.

(b) A statement that the invention developer does not intend to expend more for the invention development services than the fee charged the customer, if, in fact, it does not, and if it does, a statement of the estimated expenditures of the invention developer in excess of the fee received from the customer.

(c) A single statement setting forth both (1) the total number of customers who have contracted with the invention developer; however, the number need not reflect those customers who have contracted within the last 30 days; and (2) the number of customers that have received by virtue of the invention developer’s performance of invention development services an amount of money in excess of the amount of money paid by those customers to the invention developer.

(d) A statement as follows:

“Your potential patent rights may be adversely affected by any attempt to commercialize your idea or invention before a patent application covering it is filed. Nonconfidential disclosures of your idea or invention may also trigger certain statutory deadlines for filing a patent application in the United States and would prevent you from obtaining valid patent rights in countries whose law provides that patent applications must be filed before there is a public disclosure. Any contract for invention development services between you and our firm will be regulated by law. Our firm is not qualified or permitted to advise you whether protection of your idea or invention is available under the patent, copyright or trademark laws of the United States or any other law. The contract does not provide any patent, copyright or trademark protection for your idea or invention. If your idea or invention is patentable, copyrightable or subject to trademark protection, or infringes an existing valid patent, copyright or trademark or a patent, copyright or trademark for which application has been made, your failure to inquire into these matters may affect your rights to your idea or invention.”

history: (History: Amended by Stats. 1983, Ch. 332, Sec. 3.)

article: 4. Disclosures Made Prior to Contract


text: The provisions of this chapter are not exclusive and do not relieve the parties or the contract subject thereto from compliance with all other applicable provisions of law.

article: 4.5. Remedies and Enforcement

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 4.5. Remedies and Enforcement


text: Any contract for invention development services which does not comply with the applicable provisions of this chapter shall be void and unenforceable as contrary to public policy, provided that no contract shall be void and unenforceable if the invention developer proves that noncompliance was unintentional and resulted from a bona fide error notwithstanding the use of reasonable procedures adopted to avoid any such errors and makes an appropriate correction.

article: 4.5. Remedies and Enforcement


text: Any contract for invention development services entered into in reliance upon any willful and false, fraudulent, or misleading representation by the invention developer shall be void and unenforceable.

article: 4.5. Remedies and Enforcement


text: Any waiver by the customer of the provisions of this chapter shall be deemed contrary to public policy and shall be void and unenforceable.

article: 4.5. Remedies and Enforcement


text:
Any person who has been injured by a violation of this chapter by an invention developer, or by any false or fraudulent statement, representation, or omission of material fact by an invention developer, or by failure of an invention developer to make all the disclosures required by Section 22379, may bring a civil action against the invention developer for the greater of the following amounts:

(1) Three thousand dollars ($3,000).

(2) Three times the amount of the actual damages, if any, sustained by the plaintiff. In addition to the greater of the preceding amounts, the court may award reasonable attorney’s fees to the plaintiff.

article: 4.5. Remedies and Enforcement


text:
Any invention developer who willfully violates any provision of this chapter, or willfully enters an invention development contract which omits any duty or disclosure required by this chapter, is guilty of a misdemeanor. Any superior court of this state shall have jurisdiction in equity to restrain and enjoin the violation of any of the provisions of this chapter relating to invention development services and contracts therefor.

The duty to institute actions for violation of such provisions of this chapter, including equity proceedings to restrain and enjoin such violations, is hereby vested in the Attorney General, district attorneys, county counsels, and city attorneys. The Attorney General, any district attorney, or city attorney may prosecute misdemeanor actions or institute equity proceedings or both.

This section shall not be deemed to prohibit the enforcement by any person of any right provided by this or any other law.

article: 4.5. Remedies and Enforcement


text: Failure to make the disclosure required by Article 4 (commencing with Section 22380) shall render any contract subsequently entered into between the customer and the invention developer voidable by the customer.

article: 4.5. Remedies and Enforcement


text: Every invention developer rendering or offering to render invention development services in this state shall maintain a bond issued by a surety company admitted to do business in this state. The principal sum of the bond shall be 5 percent of the invention developer’s gross income from the invention development business in this state during the invention developer’s last fiscal year, except that the principal sum of the bond shall not be less than twenty-five thousand dollars ($25,000) in the first or any subsequent year of operations. A copy of such bond shall be filed with the Secretary of State prior to the time the invention developer first commences business in this state. The invention developer shall have 90 days after the end of each fiscal year within which to change the bond as may be necessary to conform to the requirements of this section.

article: 5. Financial Requirements

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 5. Financial Requirements


text: The bond required by Section 22389 shall be in favor of the State of California for the benefit of any person who, after entering into a contract for invention development services with an invention developer is damaged by fraud or dishonesty or failure to provide the services of the invention developer in performance of the contract.

history: (History: Amended by Stats. 1982, Ch. 517, Sec. 56.)

article: 5. Financial Requirements


text:
(a) When a deposit has been made in lieu of a bond pursuant to Section 995.710 of the Code of Civil Procedure, the person asserting a claim against the deposit shall, in lieu of Section 996.430 of the Code of Civil Procedure, establish the claim by furnishing evidence to the Secretary of State of a money judgment entered by a court together with evidence that the claimant is a person described in Section 22390.

(b) When a person has established the claim with the Secretary of State, the Secretary of State shall review and approve the claim and enter the date of approval thereon. The claim shall be designated an “approved claim.”

(c) When the first claim against a particular deposit account has been approved, it shall not be paid until the expiration of a period of 240 days after the date of its approval by the Secretary of State. Subsequent claims that are approved by the Secretary of State within the same 240-day period shall similarly not be paid until the expiration of the 240-day period. Upon the expiration of the 240-day period, the Secretary of State shall pay all approved claims from that 240-day period in full unless the deposit is insufficient, in which case each approved claim shall be paid a pro rata share of the deposit.

(d) When the Secretary of State approves the first claim against a particular deposit account after the expiration of a 240-day period, the date of approval of that claim shall begin a new 240-day period to which subdivision (c) shall apply with respect to the amount remaining in the deposit account.

(e) After a deposit account is exhausted, no further claims shall be paid by the Secretary of State. Claimants who have had their claims paid in full or in part pursuant to subdivisions (c) and (d) shall not be required to return funds received from the deposit for the benefit of other claimants.

(f) When a deposit has been made in lieu of a bond, the amount of the deposit shall not be subject to attachment, garnishment, or execution with respect to an action or judgment against the invention developer, other than as to an amount no longer needed or required for the purpose of this chapter which would otherwise be returned to the invention developer by the Secretary of State.

(g) The Secretary of State shall retain a cash deposit for two years from the date the Secretary of State receives written notification from the assignor of the deposit that the assignor has ceased to engage in the business of an invention developer or has filed a bond pursuant to Section 22389, provided that there are no outstanding claims against the deposit. The written notice shall include all of the following: (1) name, address, and telephone number of the assignor; (2) name, address, and telephone number of the bank at which the deposit is located; (3) account number of the deposit; and (4) a statement whether the assignor is ceasing to engage in the business of an invention developer or has filed a bond with the Secretary of State. The Secretary of State shall forward an acknowledgment of receipt of the written notification to the assignor at the address indicated therein, specifying the date of receipt of the written notice and anticipated date of release of the deposit.

(h) This section shall apply to all deposits retained by the Secretary of State.

(i) A judge of a superior court may order the return of the deposit prior to the expiration of two years upon evidence satisfactory to the judge that there are no outstanding claims against the deposit or order the Secretary of State to retain the deposit for a sufficient period beyond the two years specified in subdivision (g) to resolve outstanding claims against the deposit.

history: (History: Amended by Stats. 2002, Ch. 784, Sec. 8. Effective January 1, 2003.)

article: 5. Financial Requirements


text:
(a) The Secretary of State shall enforce the provisions of this title that govern the filing and maintenance of bonds and deposits in lieu of bonds.

(b) The Secretary of State shall charge and collect a filing fee not to exceed the cost of filing the bond or the deposit in lieu of a bond pursuant to Section 995.710 of the Code of Civil Procedure.

history: (History: Added by Stats. 1996, Ch. 633, Sec. 2. Effective January 1, 1997.)

article: 5. Financial Requirements


text: Every invention developer shall maintain all records and correspondence relating to performance of each invention development service contract for a period of not less than three years after expiration of the term of each such contract.

article: 6. Miscellaneous Provisions

path: 8. SPECIAL BUSINESS REGULATIONS > 17. Invention Development Services Contracts > 6. Miscellaneous Provisions


text: No invention developer shall make, or authorize the making of, any reference to compliance by it with this act in any advertisement.

article: 6. Miscellaneous Provisions


text: If any provision of this act or the application thereof to any person or circumstances is held unconstitutional, the remainder of the chapter and the application of such provision to other persons and circumstances shall not be affected thereby.

history: (History: Amended by Stats. 1982, Ch. 466, Sec. 8.)

article: 6. Miscellaneous Provisions


text:
An invention developer shall maintain as confidential all disclosures made to it by a customer seeking invention development services, except:

(a) Information which at the time of disclosure is in the public domain.

(b) Information which, after disclosure, becomes part of the public domain by publication or otherwise, independently of any act or omission by the invention developer.

(c) Information which the invention developer can establish by competent proof was in its possession at the time of disclosure by the customer, and was not acquired, directly or indirectly, from the customer.

(d) Information which the invention developer receives from a third party; provided, however, that such information was not obtained in confidence by said third party, directly or indirectly, from the customer.

This duty of confidentiality includes the taking of reasonable steps by the invention developer to prevent disclosure of confidential information to third parties. This confidential relationship cannot be waived by a customer without an express written waiver by the customer of the invention developer’s obligation of confidentiality, and no waiver shall be entered into until after the disclosures described in Section 22381 have been made.

history: (History: Added by Stats. 1983, Ch. 332, Sec. 4.)

article: 6. Miscellaneous Provisions


text:
The following terms, as used in this chapter, have the meaning expressed in this section:

(a) “Appliance” means any new television, radio, audio or video recorder, or playback device normally used or sold for use in the home or in a private motor vehicle, or any new refrigerator, freezer, range, oven, washer, dryer, dishwasher, room air conditioner, or sewing machine normally used or sold for use in the home, or any new typewriter, adding machine, calculator, or other similar machine, or any electrically operated tool, any of which appliances have a manufacturer’s invoice sale value of fifty dollars ($50) or more.

(b) “Manufacturer” means any individual, partnership, corporation, association, or other legal relationship which is involved in the manufacture, assembly, or production of an appliance or whose brand name appears on any appliance. The term “manufacturer” also means any agent, representative or distributor of a manufacturer who sells, transfers, or exchanges an appliance to or with a retailer.

history: (History: Added by Stats. 1975, Ch. 923.)

chapter: 17.5. Appliance Labeling

path: 8. SPECIAL BUSINESS REGULATIONS > 17.5. Appliance Labeling


text:
No manufacturer shall sell any appliance in this state unless such appliance has been permanently marked with a serial number unique to that appliance. A marking that is required to be permanent shall be molded, die-stamped, or paint-stenciled or stamped or etched on metal that is permanently secured or indelibly stamped on pressure sensitive labels secured by adhesive that is adequate and suitable for permanent application.

Every manufacturer of an appliance to be sold within this state shall provide on the first page of the warranty or instruction manual, or on a separate card, a description of the appliance providing a space thereon for recording the model number and serial number, the description of the location of such numbers on the appliance, and instructions to the final purchaser of the appliance to record and retain such numbers.

history: (History: Amended by Stats. 1977, Ch. 44.)


text: The provisions of Section 22411 shall not apply to factory or dealer installed radios installed in a new motor vehicle or to radios installed in a motor vehicle by a dealer to replace such factory or dealer installed radios.

history: (History: Added by Stats. 1977, Ch. 44.)


text:
(a) No deceptive identification document shall be manufactured, sold, offered for sale, furnished, offered to be furnished, transported, offered to be transported, or imported or offered to be imported into this state unless there is diagonally across the face of the document, in not less than 14-point type and printed conspicuously on the document in permanent ink, the following statement:

NOT A GOVERNMENT DOCUMENT

and, also printed conspicuously on the document, the name of the manufacturer.

(b) As used in this section, “deceptive identification document” means any document not issued by a governmental agency of this state, another state, or the federal government, which purports to be, or which might deceive an ordinary reasonable person into believing that it is, a document issued by such an agency, including, but not limited to, a driver’s license, identification card, birth certificate, passport, or social security card.

(c) Any person who violates or proposes to violate this section may be enjoined by any court of competent jurisdiction. Actions for injunction under this section may be prosecuted by the Attorney General or any district attorney in this state in the name of the people of the State of California upon their own complaint or upon the complaint of any person.

(d) Any person who violates the provisions of subdivision (a) who knows or reasonably should know that the deceptive identification document will be used for fraudulent purposes is guilty of a crime, and upon conviction therefor, shall be punished by imprisonment in the county jail not to exceed one year, or by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code.

history: (History: Amended by Stats. 2011, Ch. 15, Sec. 29. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)

chapter: 18. Identification Cards

path: 8. SPECIAL BUSINESS REGULATIONS > 18. Identification Cards


text:
(a) As used in this section, “simulated check” means any document that is not currency or a check, draft, note, bond, or other negotiable instrument but that, because of its appearance, has the tendency to mislead or deceive any person viewing it into believing that it, in fact, represents any of the following: (1) currency or a negotiable instrument that can be deposited in a bank or used for third party payments; (2) a prize, gift, or monetary benefit that the recipient has won or is entitled or guaranteed to receive; or (3) an actual check or other item of value that can be claimed or redeemed. “Simulated check” does not include a nonnegotiable check, draft, note, or other instrument that is used for soliciting orders for the purchase of checks, drafts, notes, bonds, or other instruments, and that is clearly marked as a sample, specimen, or nonnegotiable. “Simulated check” also does not include any document indicating in a truthful and nonmisleading manner that a person, in fact, unconditionally has won or is entitled or guaranteed to receive a specific prize, gift, or amount of money or credit.

(b) No person shall produce, advertise, offer for sale, sell, distribute, or otherwise transfer for use in this state any simulated check.

(c) The Attorney General may bring an action to enjoin a violation of this section, and to recover a civil penalty of not more than one hundred dollars ($100) for each violation of this section. A violation of this section may be enjoined without proof that any person has, in fact, been injured or damaged by the violation.

history: (History: Amended by Stats. 2000, Ch. 185, Sec. 2. Effective January 1, 2001.)

chapter: 18.5. Simulated Checks

path: 8. SPECIAL BUSINESS REGULATIONS > 18.5. Simulated Checks


text:
As used in this article:

(a) “Shopping cart” means a basket which is mounted on wheels or a similar device generally used in a retail establishment by a customer for the purpose of transporting goods of any kind.

(b) “Laundry cart” means a basket which is mounted on wheels and used in a coin-operated laundry or drycleaning retail establishment by a customer or an attendant for the purpose of transporting fabrics and the supplies necessary to process them.

(c) “Parking area” means a parking lot or other property provided by a retailer for use by a customer for parking an automobile or other vehicle.

history: (History: Added by Stats. 1981, Ch. 687, Sec. 1.)

chapter: 19. Shopping and Laundry Carts

path: 8. SPECIAL BUSINESS REGULATIONS > 19. Shopping and Laundry Carts > 1. Identification of Shopping and Laundry Carts


text: The provisions of Section 22435.2 shall apply when a shopping cart or a laundry cart has a sign permanently affixed to it that identifies the owner of the cart or the retailer, or both; notifies the public of the procedure to be utilized for authorized removal of the cart from the premises; notifies the public that the unauthorized removal of the cart from the premises or parking area of the retail establishment, or the unauthorized possession of the cart, is a violation of state law; and lists a valid telephone number or address for returning the cart removed from the premises or parking area to the owner or retailer.

history: (History: Amended by Stats. 1996, Ch. 291, Sec. 1. Effective January 1, 1997.)

article: 1. Identification of Shopping and Laundry Carts


text:
It is unlawful to do any of the following acts, if a shopping cart or laundry cart has a permanently affixed sign as provided in Section 22435.1:

(a) To remove a shopping cart or laundry cart from the premises or parking area of a retail establishment with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

(b) To be in possession of any shopping cart or laundry cart that has been removed from the premises or the parking area of a retail establishment, with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

(c) To be in possession of any shopping cart or laundry cart with serial numbers removed, obliterated, or altered, with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

(d) To leave or abandon a shopping cart or laundry cart at a location other than the premises or parking area of the retail establishment with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

(e) To alter, convert, or tamper with a shopping cart or laundry cart, or to remove any part or portion thereof or to remove, obliterate or alter serial numbers on a cart, with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

(f) To be in possession of any shopping cart or laundry cart while that cart is not located on the premises or parking lot of a retail establishment, with the intent to temporarily or permanently deprive the owner or retailer of possession of the cart.

history: (History: Amended by Stats. 1983, Ch. 436, Sec. 1.)


text:
Any person who violates any of the provisions of this article is guilty of a misdemeanor.

The provisions of this section are not intended to preclude the application of any other laws relating to prosecution for theft.


text: This article shall not apply to the owner of a shopping cart or laundry cart or to a retailer, or to their agents or employees, or to a customer of a retail establishment who has written consent from the owner of a shopping cart or laundry cart or a retailer to be in possession of the shopping cart or laundry cart or to remove the shopping cart or laundry cart from the premises or the parking area of the retail establishment, or to do any of the acts specified in Section 22435.2.


text:
(a) In any civil proceeding, any shopping cart or laundry cart which has a sign affixed to it pursuant to Section 22435.1 shall establish a rebuttable presumption affecting the burden of producing evidence that the property is that of the person or business named in the sign and not abandoned by the person or business named in the sign.

(b) In any criminal proceeding, it may be inferred that any shopping cart or laundry cart which has a sign affixed to it pursuant to Section 22435.1 is the property of the person or business named in the sign and has not been abandoned by the person or business named in the sign.

history: (History: Added by Stats. 1983, Ch. 436, Sec. 2.)