655 F.3d 1013 (9th Cir. 2011), 08-56065, Stearns v. Ticketmaster Corp.
|Docket Nº:||08-56065, 09-56126, 10-55341.|
|Citation:||655 F.3d 1013|
|Opinion Judge:||FERNANDEZ, Circuit Judge:|
|Party Name:||Stephen C. STEARNS, on behalf of himself, and all others similarly situated, Plaintiff-Appellant, v. TICKETMASTER CORP.; Ticketmaster, LLC; Entertainment Publications, Inc., AKA Entertainment, Inc.; IAC/InterActiveCorp, Defendants-Appellees. Craig Johnson, on behalf of themselves, and all others similarly situated; Julie Johnson, on behalf of thems|
|Attorney:||Adam J. Gutride, Gutride Safier LLP, San Francisco, CA, for the plaintiffs-appellants. Donald R. Brown (argued), Chad S. Hummel, Benjamin G. Shatz, Manatt, Phelps & Phillips, LLP, Los Angeles, CA, and David L. Shapiro, Cambridge, MA, Of Counsel, for the defendants-appellees.|
|Judge Panel:||Before: FERDINAND F. FERNANDEZ, PAMELA ANN RYMER, and RICHARD C. TALLMAN, Circuit Judges.|
|Case Date:||August 22, 2011|
|Court:||United States Courts of Appeals, Court of Appeals for the Ninth Circuit|
Argued and Submitted July 12, 2011.
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Appeal from the United States District Court for the Central District of California, Dale S. Fischer, District Judge, Presiding. D.C. Nos. 2:08-cv-00117-DSF-JTL, 2:08-cv-07509-DSF-JTL, 2:07-cv-01459-DSF-JTL.
John Mancini, Duke Sanders, and Taylor Myers appeal the district court's denial of certification of their putative class action in Mancini v. Ticketmaster (Appeal No. 10-55341); Stephen Stearns appeals the district court's dismissal of his putative class action in Stearns v. Ticketmaster (Appeal No. 08-56065); and Craig and Julie Johnson appeal the district court's dismissal of their putative class action in Johnson v. Ticketmaster (Appeal No. 09-56126). Because the issues are related— at root identical— we will sometimes refer to these parties collectively as Appellants. Appellants' actions were directed against a number of entities that were said to have participated in a deceptive internet scheme, which induced numerous individuals to unwittingly sign up for a fee-based rewards program where amounts were charged to their credit cards or directly deducted from their bank accounts. Those entities are Ticketmaster Entertainment, LLC, Ticketmaster, LLC (collectively Ticketmaster); Entertainment Publications, LLC (EPI); and IAC/InterActiveCorp (IAC). Hereafter we will sometimes refer to them collectively as Appellees.
As relevant here, Appellants' asserted claims for violations of California's Unfair Competition Law (UCL),1 California's Consumers Legal Remedies Act (CLRA),2 and the Federal Electronic Fund Transfer Act (EFTA).3 They sought to certify their claims for class treatment. The district court denied class certification of the UCL claim, the EFTA actual damages claim, and the CLRA claim in the Mancini action. It dismissed both the Stearns and Johnson actions. These appeals followed. We affirm in part, reverse in part, and remand.
While the issues are somewhat complex, many of the basic facts are not. 4 Ticketmaster operates the www. ticketmaster. com website. It and EPI were operating businesses of IAC at one time. They have since separated. Since 2004, EPI has operated the Entertainment Rewards program, which is an online coupon program. Members of Entertainment Rewards can download printable coupons from EPI's website, which allows them to receive discounts at a variety of retail establishments. EPI charges a monthly membership fee following a free trial (thirty days) for those who enroll.
The Entertainment Rewards program has been linked to Ticketmaster's website since April 7, 2004. The Entertainment Rewards " ad unit" is displayed on the ticket purchase confirmation page, after customers have purchased tickets from Ticketmaster's website. An example of the Entertainment Rewards ad unit on the Ticketmaster confirmation page is as follows:
Get a $25 Cash Back Award with your next Ticketmaster Purchase.
Your order is complete.
Click here for details on the $25 Cash Back Award.
Click above to learn how to get $25 Cash Back from Entertainment Rewards.
Once customers click on that ad unit, they are taken to a landing page on the EPI website. If they enter their email address twice on the landing page, and click on a " Sign Me Up" or " Yes" button, they wind up enrolled in the program. Once that occurs, any credit or debit card information that had been given to Ticketmaster is transferred from Ticketmaster to EPI automatically, and without any communication between Ticketmaster or EPI and the customer. The process is euphemistically known as a " data pass." Once that occurs, customers, after the thirty-day trial period, will have their credit cards or bank accounts charged on a monthly basis.
The gravamen of Appellants' claims is that the Appellees' website presentations and practices are designed to lull and induce people, who really only intended to purchase tickets from Ticketmaster, into inadvertently becoming committed to purchasing EPI's services, which they neither expected, nor wanted, nor used, and that EPI then proceeds to mulct them with continuing charges. EPI even goes so far as to make charges to their credit cards, or take money directly from their bank accounts, all without specific authorization. And EPI does not issue a confirmation at the end of the internet transaction to memorialize
the fact that a deal has been consummated.
As a result of the above, Appellants sought certification of a class composed of " [a]ll persons in the United States who: (1) made a purchase at Ticketmaster.com between September 27, 2004, and the present ..., (2) were enrolled in Entertainment Rewards by Ticketmaster passing their credit or debit card information to [EPI], (3) were charged for Entertainment Rewards, and (4) did not print any coupon or apply for any cashback award from Entertainment Rewards...." 5
JURISDICTION AND STANDARDS OF REVIEW
The district court had jurisdiction pursuant to 28 U.S.C. §§ 1331, 1332(d)(2)(A). We have jurisdiction pursuant to 28 U.S.C. § 1291 (dismissed actions), in part, and 28 U.S.C. § 1292(e) (denial of class action certification), in part.6
We review a district court's denial of class certification for abuse of discretion. Wolin v. Jaguar Land Rover N. Am., LLC, 617 F.3d 1168, 1171 (9th Cir.2010). The same is true for " any particular underlying Rule 23 determination involving a discretionary determination." Yokoyama v. Midland Nat'l Life Ins. Co., 594 F.3d 1087, 1091 (9th Cir.2010). In so doing, we ask:
whether the district court correctly selected and applied Rule 23 criteria. An abuse of discretion occurs when the district court, in making a discretionary ruling, relies upon an improper factor, omits consideration of a factor entitled to substantial weight, or mulls the correct mix of factors but makes a clear error of judgment in assaying them.
Wolin, 617 F.3d at 1171(internal quotation marks and citations omitted). " ‘ To the extent that a ruling on a Rule 23 requirement is supported by a finding of fact,’ we review that finding for clear error." Id. at 1171-72. And, we review a district court's determination of whether information is immaterial under that clearly erroneous standard. See S.E.C. v. Talbot, 530 F.3d 1085, 1090 (9th Cir.2008).
" While our review of discretionary class certification decisions is deferential, it is also true that we accord the decisions of district courts no deference when reviewing their determinations of questions of law. Further, this court has oft repeated that an error of law is an abuse of discretion." Yokoyama, 594 F.3d at 1091.
" We review de novo a district court's order granting a motion to dismiss under Rule 12(b)(6)." Cook v. Brewer, 637 F.3d 1002, 1004 (9th Cir.2011). However, we review a decision to dismiss with prejudice for an abuse of discretion. See Schreiber Distrib. Co. v. Serv-Well Furniture Co., Inc., 806 F.2d 1393, 1402 (9th Cir.1986).
Although the core of Appellants' claims is the same, each of them subtends different issues, especially from a class action perspective. We will consider each of those in turn. But first, we will say a few words about class actions in general, and quickly dispose of a typicality issue.
For a class to be certified, a plaintiff must satisfy each prerequisite of Rule 23(a) of the Federal Rules of Civil Procedure and must also establish an appropriate ground for maintaining class actions under Rule 23(b). See Rodriguez v. Hayes, 591 F.3d 1105, 1122 (9th Cir.2010). The requirements of Rule 23(a) are: (1) a class so numerous that joinder is impractical (numerosity); (2) common questions of fact or law (commonality); 7 (3) typicality of the representatives (typicality); and (4) that the representatives will adequately protect the class (adequate representation).8Fed.R.Civ.P. 23(a); Wal-Mart Stores, Inc. v. Dukes, __ U.S. __, __, 131 S.Ct. 2541, 2548, 180 L.Ed.2d 374 (2011).
A plaintiff must also satisfy one of Rule 23(b)'s provisions. The provision at issue here is Rule 23(b)(3), which requires that " questions of law or fact common...
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