Darisse v. Nest Labs, Inc.

Decision Date15 August 2016
Docket NumberCase No. 5:14-cv-01363-BLF
PartiesJUSTIN DARISSE, Plaintiff, v. NEST LABS, INC., Defendant.
CourtU.S. District Court — Northern District of California

[Re: ECF 89]

During the dog days of summer and the deep chills of winter, people turn to thermostats to keep their homes at a livable temperature. To that end, Plaintiff Justin Darisse purchased a Nest Learning Thermostat ("NLT"), hoping that it would save him energy and money in addition to keeping him comfortable. He now sues Defendant Nest Labs, Inc. ("Nest"), alleging that the NLT did not perform as advertised, and moves to certify a nationwide class of similarly disappointed consumers. But because Darisse has not satisfied Rule 23(a)'s commonality, typicality, and adequacy requirements, or Rule 23(b)(3)'s predominance requirement, his motion is DENIED.1


The NLT is a Wi-Fi-enabled thermostat that logs user behavior and preferences, and uses that data to control basic heating and cooling operations in the home. See Opp. at 1, ECF 111-11. The first generation of NLTs hit the market in October 2011, and the second generation came out in October 2012. See Oenning Decl. ¶ 6, ECF 116. NLTs are sold through several different retail channels, and retailers use a wide variety of marketing claims to sell them. Id. ¶¶ 2-3, 18-19. As a result, where you buy your NLT affects what promotional claims you see. Id. For example, putative class members who bought NLTs from Nest.com might have seen some of these claims,which appeared on Nest's website at various times during the class period:

"The EPA says a properly programmed thermostat can cut 20% off your heating and cooling bill." Oenning Decl. Ex. G at 1, ECF 116-2.
"Teach [the NLT] well and the Nest Thermostat can lower your heating and cooling bills up to 20%." Oenning Decl. Ex. I at 1, ECF 116-3.
"12 [MONTHS IN USE] = $173 [DOLLARS IN SAVINGS]" Oenning Decl. Ex. K at 4-5, ECF 116-4; Oenning Decl. Ex. O at 4, ECF 116-5. (This representation was followed by a disclaimer stating that "results will vary depending on local climate, energy rates, home size and your home's insulation." Id.)
"If your thermostat isn't programmed, you could be wasting around $173 a year. . . . A correctly programmed thermostat can save about 20% on your heating and cooling bill." Oenning Decl. Ex. N at 1, ECF 116-5.

Like the marketing claims on Nest's website, the marketing claims on the NLT's product packaging also varied over time. The first generation NLT's product packaging did not make any claims about energy savings of up to 20% or $173/year. See Oenning Decl. ¶¶ 6-7, ECF 116; Id. at Ex. B, ECF 116-1; id. at Ex. C, ECF 116-1; id. at Ex. D, ECF 116-2. In contrast, some versions of the second generation NLT's product packaging—there were at least four—did make claims about energy savings. See id. ¶ 8, ECF 116. The exact language varied over time, but at one point, the packaging read, "Most thermostats waste 20% of your heating and cooling bill. Nest stops the waste." Oenning Decl. ¶ 8, ECF 116; Oenning Decl. Ex. F at 3, ECF 116-2.

Darisse bought a second generation NLT in fall 2013. See Amended Complaint ¶ 9, ECF 28; Darisse Decl. ¶ 4, ECF 88-17. He purchased his NLT from Amazon.com, using his spouse's Amazon Prime account. See Reply at 12, ECF 124-4. He states that he bought his NLT "based on statements on the Nest website that '[A] correctly programmed thermostat can save about 20% on your heating and cooling bill,' that [he] could save $173 a year on average on energy, and that 'Nest saves energy. Automatically.'" Darisse Decl. ¶ 4, ECF 88-17. He "reviewed the same statements on Amazon.com" before buying the NLT. Id.

Darisse now argues that Nest's cost and energy savings estimates are flawed and the NLTdoes not live up to its promises of saving up to 20% on heating and cooling bills, or $173 annually. See Mot. at 3-9, ECF 88-16. Darisse provided his energy bills for May to October 2013, the five months before he bought his NLT, and the parties compared those bills with his energy bills for May to October 2014 and May to October 2015. The comparison showed that in 2014, Darisse's monthly energy savings post-NLT installation fluctuated between 4.7% and 22.2%, but in 2015, his monthly energy savings topped out at 9.0%. See Blasnik Decl. ¶ 11, ECF 111-14; Weir Reply Decl. ¶¶ 69-72, ECF 124-10.

Billing Cycle Ending
% Energy Savings
v. 2013
% Energy savings
2015 v. 2013


See Blasnik Decl. ¶11, ECF 111-14; Weir Reply Decl. ¶ 71, ECF 124-10. Darisse says that he would not have bought his NLT if he had known that Nest's representations about a 20% or $173 savings were "inaccurate and misleading." Darisse Decl. ¶ 5, ECF 88-17.

In March 2014, less than half a year after buying his NLT, Darisse sued Nest on behalf of himself and others similarly situated, raising claims for (1) violation of Cal. Civ. Code §§ 1750 et seq., California's Consumer Legal Remedies Act ("CLRA"); (2) violation of Cal. Bus. & Prof. Code §§ 17200 et seq., California's Unfair Competition Law ("UCL"); (3) violation of Cal. Bus. & Prof. Code §§ 17500 et seq., California's False Advertising Law ("FAL"); (4) breach of express warranty; (5) breach of the implied warranty of merchantability; (6) breach of implied warranty of fitness for a particular purpose; and (7) common law fraud. See Consolidated Compl. ¶¶ 68-131. He seeks declaratory relief, injunctive relief, and damages. See id. at 39. He now moves under Rule 23(b)(3) and asks the Court to certify a nationwide class defined as

All persons who purchased a Nest First Generation or Second Generation Thermostat ("Nest") from November 1, 2011 to February 1, 2015.

Mot. at 1, ECF 88-16. Nest opposes Darisse's motion and argues that Darisse lacks standing, that differences in state laws prevent certifying a nationwide class under Rule 23(b)(3), and thatDarisse has not satisfied Rule 23(a)'s commonality, adequacy, and typicality requirements. The Court finds that Darisse has standing, but DENIES Darisse's motion because he has not satisfied Rule 23(a) and 23(b)(3).

A. Legal Standard

Ordinarily, questions of standing are raised by way of a motion to dismiss for lack of subject matter jurisdiction. See, e.g., Perez v. Nidek Co., 711 F.3d 1109, 1113-14 (9th Cir. 2013); Quinn v. Anvil Corp., 620 F.3d 1005, 1014-15 (9th Cir. 2010); see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). Here, rather than filing any Rule 12 motion, Nest simply answered. See Docket No. 33. But a court is always obligated to consider whether any plaintiff has standing to pursue the relief sought. "Standing is a threshold matter central to our subject matter jurisdiction. We must assure ourselves that the constitutional standing requirements are satisfied before proceeding to the merits." Bates v. United Parcel Serv., Inc., 511 F.3d 974, 985 (9th Cir. 2007) (citing United States v. Hays, 515 U.S. 737, 742 (1995)); Casey v. Lewis, 4 F.3d 1516, 1524 (9th Cir. 1993)). The Court thus must consider Darisse's standing to pursue his proposed class-wide declaratory, injunctive, and damages relief before anything else. See Ellis v. Costco Wholesale Corp., 657 F.3d 970, 978 (9th Cir. 2011) ("In a class action, the plaintiff class bears the burden of showing that Article III standing exists."); In re Abbott Labs. Norvir Anti-Trust Litig., Case No. 04-cv-1511-CW, 2007 WL 1689899, at *2 (N.D. Cal. June 11, 2007) (quoting Wooden v. Bd. of Regents of Univ. Sys. of Georgia, 247 F.3d 1262, 1287-88 (11th Cir. 2001)) ("[P]rior to the certification of a class, and technically speaking before undertaking any formal typicality or commonality review, the district court must determine that at least one named class representative has Article III standing to raise each class subclaim.").

"In a class action, standing is satisfied if at least one named plaintiff meets the requirements." Bates, 511 F.3d at 985. Article III standing requires a plaintiff show "(1) an injury-in-fact that is concrete and particularized, as well as actual or imminent; (2) that the injury is fairly traceable to the challenged action of the defendant; and (3) that the injury is redressable by a favorable ruling." Kane v. Chobani, Inc., 973 F. Supp. 2d 1120, 1128 (N.D. Cal.2014) (citing Monsanto Co. v. Geertson Seed Farms, 130 S. Ct. 2743, 2752 (2010)). The plaintiff "bears the burden of showing that he has standing for each type of relief sought," and so a plaintiff seeking equitable relief such as an injunction must further demonstrate a likelihood of future injury. Summers v. Earth Island Inst., 555 U.S. 488, 493 (2009); see also Wang v. OCZ Tech. Group, Inc., 276 F.R.D. 618, 626 (N.D. Cal. 2011) (citing Hodgers-Durgin v. De La Vina, 199 F.3d 1037, 1039 (9th Cir. 1999); see also Clark v. City of Lakewood, 259 F.3d 996, 1006-07 (9th Cir. 2001), as amended (Aug. 15, 2001) (citing Friends of the Earth Inc. v. Laidlaw Env. Servs. (TOC), Inc., 528 U.S. 167, 191-91 (2000); City of Los Angeles v. Lyons, 461 U.S. 95, 109 (1983)). This requires a showing that the plaintiff is "realistically threatened by a repetition of the violation." Gest v. Bradbury, 443 F.3d 1177, 1181 (9th Cir. 2006) (quoting Armstrong, 275 F.3d at 860-61). Allegations that a defendant's continuing conduct subjects unnamed class members to the alleged harm are insufficient if the named plaintiffs are themselves unable to demonstrate a likelihood of future injury. See Hodgers-Durgin, 199 F.3d at 1044-45; see also Clapper v. Amnesty Int'l USA, 133 S. Ct. 1138, 1114 (2013).

B. Discussion

Darisse has satisfied the injury requirement for each type of relief he seeks, except for injunctive relief.2 At this stage, allegations alone are not enough. Because the elements of Article III standing "are not mere pleading requirements...

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