In re Seagate Tech. LLC

• Court: U.S. District Court — Northern District of California
• Writing for the Court: JOSEPH C. SPERO Chief Magistrate Judge
• Decision Date: 25 August 2017
• Docket Number: Case No. 16-cv-00523-JCS
• Citation: In re Seagate Tech. LLC, Case No. 16-cv-00523-JCS (N.D. Cal. Aug 25, 2017)
• Parties: IN RE SEAGATE TECHNOLOGY LLC LITIGATION CONSOLIDATED ACTION

IN RE SEAGATE TECHNOLOGY LLC LITIGATION

CONSOLIDATED ACTION

Case No. 16-cv-00523-JCS

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

August 25, 2017

ORDER REGARDING MOTION TO STRIKE AND FOR JUDGMENT ON THE PLEADINGS

Re: Dkt. No. 114

I. INTRODUCTION

Plaintiffs¹ bring this putative class action against Defendant Seagate Technology LLC ("Seagate"), alleging that Seagate misrepresented certain hard drives and delivered defective drives to consumers. Seagate now moves to strike certain claims previously dismissed by the Court and allegations related thereto, to dismiss other claims, and to strike nationwide class allegations. The Court heard argument on August 25, 2017. For the reasons set forth below, Seagate's motion GRANTED in part and DENIED in part.² Plaintiffs may amend their complaint to address the deficiencies identified below no later than September 15, 2017.

II. BACKGROUND

Seagate manufactures and distributes hard drives. 2d Consolidated Am. Compl. ("SCAC," dkt. 62) ¶ 25. Seagate released the Seagate Barracuda 3 TB internal hard drive, model number ST3000DM001, in October of 2011. Id. ¶ 2. Seagate subsequently released two external 3TB hard drives—the Backup Plus 3TB and GoFlex 3TB—that enclosed the same model numberST3000DM001 hard drives in external casings with external power supplies and USB connectors. Id. ¶¶ 2, 47-48. In late 2012 or early 2013, Seagate rebranded the Barracuda 3TB internal drive as the "Desktop HDD" internal drive, but the model number remained the same. Id. ¶ 46. According to Plaintiffs, Seagate has continuously and falsely marketed these model number ST3000DM001 "Barracuda" hard drives as "reliable, dependable, and suitable for use in Network Attached Storage ("NAS") and Redundant Array of Independent Disks ("RAID") configurations." Id. ¶¶ 3-4. Plaintiffs allege that the Barracuda drives³ had a "latent, model-wide defect" that caused them to fail at annual rate "as high as 47.2%" and that the drives "are not designed for certain types of home RAID configurations." Id. ¶¶ 4, 5. In support of those allegations, Plaintiffs cite reports by online data backup provider Backblaze, Inc. stating that based on Backblaze's experience with a large number of hard drives from Seagate and other manufacturers, the Barracuda drives failed at a significantly higher rate than most other hard drives. Id. ¶¶ 82-109 & Ex. E.

The eight named plaintiffs are citizens of eight different states,⁴ each of whom purchased at least one Seagate Barracuda hard drive from an authorized retailer. Id. ¶¶ 14, 15-17, 19-23, 135-136, 149-50, 162-63, 174-75, 186-87, 211-12, 223-24, 232-33. Each named plaintiff alleges reliance on Seagate's advertising representations and express warranty. Id. ¶¶ 137-40, 151-54, 165-67, 176-79, 188-93, 213-18, 225-39, 234-36. Each named plaintiff also alleges that at least one of his Barracuda drives failed under warranty. Id. ¶¶ 144, 158, 169, 182, 195-201, 220, 230, 239. Plaintiffs seek to represent a nationwide class of individuals who purchased at least one Seagate model ST3000DM001 or, in the alternative, statewide subclasses of purchasers for each of the states represented by a named plaintiff. Id. ¶¶ 264-65.

Plaintiffs' operative complaint asserted claims for breach of express and implied warranty (Claims 4 through 7), violation of California's Unfair Competition Law ("UCL"), False Advertising Law, and Consumer Legal Remedies Act ("CLRA") and the consumer protection statutes of the eight other states of the current and former named plaintiffs' citizenship (Claims 1 through 3 and 8 through 15), and unjust enrichment (Claim 16).

This case was initially assigned to the Honorable Ronald Whyte, but was reassigned to the undersigned magistrate judge upon consent of all parties following Judge Whyte's retirement. On a previous motion by Seagate, the Court dismissed several claims and theories of recovery:

(1) Plaintiffs' express warranty claims (including to the extent such claims are based on the essential purpose doctrine or the Song-Beverly Act); (2) Plaintiffs' implied warranty claims under the California Commercial Code; (3) Plaintiffs' affirmative misrepresentation claims based on Seagate's statements about the drives' read error rate, NAS capabilities, AcuTrac technology, and general reliability and performance; (4) Plaintiffs' omissions claims based on NAS capabilities and read error rates; (5) all CLRA claims by [then-]Plaintiff John Smith; and (6) Plaintiffs' claims under the "unlawful" and "unfair" prongs of the UCL to the extent that they depend on theories dismissed in the context of other claims.

Order Granting in Part & Denying in Part Mot. to Dismiss SCAC ("MTD Order," dkt. 100).⁵

III. ANALYSIS

A. Motion to Strike Under Rule 12(f)

1. Legal Standard

A party may move the court to "strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed. R. Civ. P. 12(f). "The function of a 12(f) motion to strike is to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial . . . ." Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010) (quoting Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993)). "Motions to strike are generally regarded with disfavor because of the limited importance of pleading in federal practice, and because they are often used as a delaying tactic." Mag Instrument, Inc. v. JS Prods., Inc., 595 F. Supp. 2d 1102, 1106 (C.D. Cal.2008). "Ultimately, whether to grant a motion to strike lies within the sound discretion of the district court." Nguyen v. CTS Elecs. Mfg. Sols. Inc., No. 13-CV-03679-LHK, 2014 WL 46553, at *3 (N.D. Cal. Jan. 6, 2014) (citing Whittlestone, 618 F.3d at 973).

2. Timeliness

Rule 12(f) provides that a party may move to strike portions of a pleading "either before responding to the pleading or, if a response is not allowed, within 21 days after being served with the pleading." Fed. R. Civ. P. 12(f)(2). Here, Plaintiffs filed the SCAC on July 11, 2016, Seagate moved to dismiss on August 5, 2016, and after that motion was denied, Seagate filed its answer on March 24, 2017. Under the plain language of the Rule, because the SCAC required a response, any motion to strike under Rule 12(f) was due before Seagate responded to the SCAC. Seagate first moved to strike on May 26, 2017—more than two months after answering⁶—and refiled its motion to comply with this Court's local rule regarding noticing hearing dates on May 31, 2017.

Rule 12(f) also provides, however, that a court may strike material "on its own," without any time limit for the court to do so. Fed. R. Civ. P. 12(f)(1). Some courts have therefore held that a court has discretion to consider an untimely motion to strike under Rule 12(f). E.g., United States v. Wang, 404 F. Supp. 2d 1155, 1157 (N.D. Cal. 2005) (citing Or. Laborers-Emp'rs Tr. Funds v. Pac. Fense & Wire Co, 726 F. Supp. 786, 788 (D. Or. 1989); Estee Lauder, Inc. v. Fragrance Counter, Inc., 189 F.R.D. 269, 271 (S.D.N.Y. 1999)). The Ninth Circuit, however—in a case cited in Seagate's motion, Mot. at 6 n.4—has held that granting such a motion is error:

The district court struck the counts relating to the qualifications of the new union trustees. The court purportedly acted pursuant to Fed. R. Civ. P. 12(f), which permits the court, in its discretion, to order stricken from any pleading "any redundant, immaterial, impertinent, or scandalous matter." This was error. The district court has authority under Rule 12(f) to strike a pleading, in whole or in part, only if a motion is made before the moving party has filed a responsive pleading, unless the court strikes the pleading on its own initiative or no responsive pleading is permitted. The district court struck the counts in question upon the motion of the trustees afterthey had already filed their answer to the complaint. Thus, the motion was untimely under Rule 12(f).

Culinary & Serv. Emps. Union, AFL-CIO Local 555 v. Hawaii Emp. Benefit Admin., Inc., 688 F.2d 1228, 1232-33 (9th Cir. 1982) (emphasis added). The Ninth Circuit went on to hold that, under the circumstances of that case, reversal was not warranted because the plaintiffs failed to object to the untimeliness of the motion before the district court, and because the district court struck claims without prejudice to refiling them in a separate complaint and the error was therefore harmless. Id.

The two district court decisions that Seagate cites for this issue from within the Ninth Circuit fail to acknowledge Culinary in any way. See Wang, 404 F. Supp. 2d at 1157 (quoting Oregon Laborers-Employers for the proposition that "a party has the right to challenge the legal sufficiency of a defense at any time"); Or. Laborers-Emp'rs, 726 F. Supp. at 788 (asserting the same, without citation to authority). At least one district court decision within the Ninth Circuit has held that, despite Culinary, "Rule 1's mandate to construe the Federal Rules of Civil Procedure to achieve a just, speedy, and efficient resolution of the action" grants discretion to consider untimely motions under Rule 12(f). In re Mission Bay Jet Sports, LLC, No. 08cv0146 JM(CAB), 2010 WL 144441, at *3 (S.D. Cal. Jan. 11, 2010); see also Hochberg v. Lincare, Inc., No. CV-07-0031-EFS, 2008 WL 11342786, at *2 (E.D. Wash. Mar. 12, 2008) (considering an untimely motion to strike despite Culinary, but denying the motion on the merits). Yet another district court has denied an untimely motion to strike based on Culinary, but in the same decision granted the same relief on its own motion because the pleading at issue failed to comply with a prior order of the court. Winnemem Wintu Tribe v. U.S. Forest Serv., No. 2:09-CV-1072 KJM KJN, 2013 WL 1325423, at *3-4 (E.D. Cal. Mar. 29, 2013).

Despite district court decisions that have held to the contrary, this Court agrees with the Winnemem Wintu court that Cu...