Kevin Park v. Webloyalty.Com, Inc.
| Decision Date | 29 September 2014 |
| Docket Number | CASE NO. 12cv1380-LAB (JMA) |
| Court | U.S. District Court — Southern District of California |
| Parties | KEVIN PARK, Plaintiff, v. WEBLOYALTY.COM, INC., Defendant. |
Defendant Webloyalty.com, Inc. has filed a motion to dismiss. Because the motion was over-length, Webloyalty also filed a motion for leave to file excessive pages. The unopposed motion for leave to file excessive pages is GRANTED, and the motion to dismiss is accepted as filed.
On May 19, 2009, Plaintiff Kevin Park purchased a gift certificate online from Gamestop.com. After entering his credit card information, Park saw an offer for a coupon to save on his next purchase. Park clicked on the offer, and was directed to a new window. This new window provided the details of the coupon offer and explained that by providing an email address the customer would be agreeing to a subscription to a membership-fee based program known as Complete Savings. Park claims he was not aware of the membership program he was signing up for, and assumed it was part of his GameStop purchase. The enrollment page asked him to provide his email address twice and click an acceptancebutton. By clicking this acceptance button, Park subscribed to a fee-based membership program known as Complete Savings, operated by Webloyalty. Park never re-entered his billing information for this subscription; rather, the data was shared by a method known as "data pass." The first charge by Webloyalty was made one month later, on June 19, 2009.
Park alleges that Webloyalty obtained his billing information directly from Gamestop.com through the "data pass" process. Park claims that he never intended to join any membership program, and was not even aware that he had been redirected away from the website Gamestop.com. Park says that in April of 2011 he discovered unauthorized charges to his bank account totaling $264. These were the charges made by Webloyalty. He requested a refund, and Webloyalty granted him only a partial refund of $48.
Park has brought this putative class action, with the putative class consisting of all persons who did not directly provide their billing information to Webloyalty, but who were charged for a subscription based program at any time since December 29, 2010. A different putative class action, Berry v. Webloyalty.com, Inc., 10cv1358-H (CAB) was filed in this District on June 25, 2010, and Park says he was a member of the putative class in that case. The Berry decision was vacated on appeal, because Webloyalty had given the plaintiff a full refund, resulting in his lacking a cognizable injury. Berry v. Webloyalty.com, Inc., 517 Fed. Appx. 581 (9th Cir. 2013). This deprived him of standing, and the court of jurisdiction. Id. at 582.
The original complaint was dismissed for failure to allege jurisdictional facts. The Second Amended Complaint (SAC) is the operative pleading. Webloyalty has moved to dismiss the SAC for failure to state a claim. In support of its motion, Webloyalty asks the Court to take judicial notice of web pages and disclosures referred to in the SAC.
A Rule12(b)(6) motion to dismiss tests the sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir.2001). When determining whether a complaint states a claim, the Court accepts all allegations of material fact in the complaint as true and construesthem in the light most favorable to the non-moving party. Cedars-Sinai Medical Center v. National League of Postmasters of U.S., 497 F.3d 972, 975 (9th Cir. 2007) (citation omitted). But the Court is "not required to accept as true conclusory allegations which are contradicted by documents referred to in the complaint," and does "not . . . necessarily assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th Cir.2003) (citations and quotation marks omitted).
Under Fed. R. Civ. P. 8(a)(2), only "a short and plain statement of the claim showing that the pleader is entitled to relief," is required, in order to "give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554-55 (2007). "Factual allegations must be enough to raise a right to relief above the speculative level . . . ." Id. at 555. "[S]ome threshold of plausibility must be crossed at the outset" before a case is permitted to proceed. Id. at 558 (citation omitted). The well-pleaded facts must do more than permit the Court to infer "the mere possibility of conduct"; they must show that the pleader is entitled to relief. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009).
Generally, the scope of review on a motion to dismiss for failure to state a claim is limited to the contents of the complaint. See id. at 1141 n.5. But the Court may consider judicially noticeable facts, see Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d 895, 899 (9th Cir. 2007), as well as "documents whose contents are alleged in a complaint and whose authenticity no party questions," even if they are not attached to the pleading. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir.1994) overruled on other grounds by Galbraith v. County of Santa Clara, 307 F.3d 1119 (9th Cir. 2002). The court may treat such a document as "part of the complaint, and thus may assume that its contents are true for purposes of a motion to dismiss under Rule 12(b)(6)." United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).
Under Fed. R. Evid. 201(b), the Court can take judicial notice of facts not subject to reasonable dispute. Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th Cir.2001). Under Fed. R. Evid. 201(d), the Court must take notice if requested by a party and if supplied with the necessary information. But Park has opposed the request, and seeks discovery to confirm whether the documents are authentic and accurate. By their nature, the original documents are not likely to be within Park's control. Because the documents Webloyalty asks the Court to take notice of are not "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned," Fed. R. Evid. 201(b), judicial notice is inappropriate here. Nor may the Court treat these documents as the ones whose contents are alleged in the SAC.
Park asks the Court to take judicial notice of two staff reports prepared for the chair of the U.S. Senate Committee on Commerce, Science, and Transportation regarding industry practices. Congressional acts and records are noticeable, and the reports may be relevant to Congressional purpose in enacting the Restore Online Shoppers' Confidence Act, or to show the government was concerned about the business practices the reports detail. The facts and conclusions set forth in the reports, however, are subject to dispute; that dispute is at the heart of this case. See In re Easysaver Rewards Litigation, 737 F. Supp. 2d 1159, 1171 (S.D.Cal., 2010) (). The Court therefore takes notice of the reports, but only for purposes of showing that the Senate conducted an investigation and considered these matters, and not for purposes of showing whether the interaction between Webloyalty and Park—as well as the putative class members—is actionable. The fact that a Senate committee conducted an investigation, in other words, does not deprive Webloyalty of its day in court.
The fact that the reports are alleged in the SAC, and the Court's taking judicial notice of the reports do not relieve Park of his obligation to plead facts to establish his claim. Thereports speak of what the authors believe happened to consumers in general; they do not purport to say what happened to Park.
Park claims that the charges made by Webloyalty were "unauthorized electronic funds transfers," as that term is defined in the Electronic Funds Transfer Act 15 U.S.C. § 1693a(11). According the EFTA, "[a] preauthorized electronic fund transfer from a consumer's account may be authorized by the consumer only in writing, and a copy of such authorization shall be provided to the consumer when made." 15 U.S.C. § 1693e(a). Park claims that the input of his email address was not a sufficient authorization under EFTA, and therefore the charges made by Webloyalty were unlawful.
Webloyalty responds with two main arguments. First, it argues that Park has failed to state a claim for which relief may be granted because the enrollment page, which Park referenced in the SAC, disclosed the financial details of the enrollment seven times, and explicitly stated that by entering his email address twice he would be authorizing the charges, and a valid authorization would preclude Park's EFTA claims. Second, they argue that Park's EFTA claim is time-barred because it was brought after the expiration of the one-year statute of limitations.
Webloyalty's first argument is that Park has failed to state a claim under EFTA because Webloyalty's enrollment page fully disclosed all details of the financial transaction, and Park provided a valid authorization by inputting his email address twice. Webloyalty relies on Berry, in which it made almost identical disclosures and the court held that a plaintiff's input of his email into a nearly identical form constituted a valid authorization under the EFTA. Berry v. Webloyalty, 2011 WL 1375665 (S.D. Cal., Apr. 11, 2011). Park argues that Berry lacks any precedential value because of its vacatur. But because it was vacated on other grounds, it remains persuasive precedent.
In general, the question of whether a business practice is deceptive is a question of fact. See Castagnola v. Hewlett-Packard Co., 2012 WL...
To continue reading
Request your trial