King v. Bumble Trading, Inc.

• Decision Date: 08 July 2019
• Docket Number: Case No.18-cv-06868-NC
• Citation: 393 F.Supp.3d 856
• Parties: Nick KING, et al., Plaintiffs, v. BUMBLE TRADING, INC., et al., Defendants.
• Court: U.S. District Court — Northern District of California

393 F.Supp.3d 856

Nick KING, et al., Plaintiffs,

v.BUMBLE TRADING, INC., et al., Defendants.

Case No.18-cv-06868-NC

United States District Court, N.D. California.

Signed July 8, 2019

Grace E. Parasmo, Yitzchak Hillel Lieberman, Parasmo Lieberman Law, Los Angeles, CA, David C. Parisi, Suzanne Havens Beckman, Suzanne L. Havens Beckman, David Christopher Parisi, Parisi and Havens LLP, San Francisco, CA, for Plaintiffs.

Michael Graham Rhodes, Kyle Christopher Wong, Max Bernstein, Esq., Cooley LLP, Kelsey R. Spector, San Francisco, CA, for Defendants.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS

Re: Dkt. No. 44

NATHANAEL M. COUSINS, United States Magistrate Judge

Before the Court is defendants Bumble Trading, Inc. and Bumble Holding Ltd.'s motion to dismiss plaintiffs Nick King Jr., Deena Fischer, and Elena Weinberger's claims under California's Dating Service Law and related consumer protection statutes. The central question presented is whether the choice of law provision in Bumble's terms of service applies to Plaintiffs' claims. See Dkt. No. 44. Because Plaintiffs allege violations of the Dating Service Law and the Automatic Renewal Law, the Court must consider whether those statutes represent fundamental public policies of California. The Court concludes that the Dating Service Law does not, but the Automatic Renewal Law does. Accordingly, the Court DISMISSES without leave to amend Plaintiffs' claims relying upon the Dating Service Law. Plaintiffs' claims relating to the Automatic Renewal Law survive.

I. Background

A. Allegations in the Complaint

Plaintiffs bring a putative class action arising out of Bumble's alleged business practices. See Dkt. No. 43 ("SAC"). Bumble owns and operates mobile software applications that offer dating services (the "Bumble App"). Id. ¶ 1. Bumble also offers a premium, paid service through the Bumble App called "Bumble Boost." Id. ¶ 23. Bumble Boost offers weekly and monthly subscriptions allowing users to "view which other users have indicated interest, to extend expiring connections, and to revive expired ones." See Dkt. No. 44 at 10.

Plaintiffs downloaded and installed the Bumble App and purchased Bumble Boost. SAC ¶¶ 56, 75, 85. Fischer and Weinberger requested refunds following their purchases—Fischer because of technical issues with her account and Weinberger because she no longer wanted the Bumble App—but both were denied. Id. ¶¶ 78–79, 87–88. King was similarly denied a refund after he informed Bumble that he had not authorized five auto-renewing weekly payments for Bumble Boost. Id. ¶¶ 64–65.

Plaintiffs allege that Bumble does not notify consumers of their right to cancel their dating service contracts and instead maintains that all purchases are non-refundable. Id. ¶¶ 31, 33.

King further alleges that Bumble failed to disclose the automatic renewal terms of his Bumble Boost subscription, gain his affirmative consent to automatic renewal, and provide a statutorily-required acknowledgement. SAC ¶¶ 62, 110–13. He claims that Bumble's acknowledgement email failed to provide him with the automatic renewal or continuous service offer terms and cancellation policy, nor did it provide information regarding how to cancel. Id. ¶ 62; see also id. Ex. B. King states that after the one-week subscription expired, he no longer used, nor did he want, Bumble Boost, but Bumble automatically renewed the subscription and continued to charge his debit card $8.99 for five weeks. Id. ¶ 63. King maintains that Bumble denied his refund request for these allegedly unauthorized charges. Id. ¶ 65.

Before using the Bumble App, Plaintiffs must agree to Bumble's Terms of Service ("Terms"). See id. ¶ 3. Those Terms include a choice of law provision selecting New York law:

Your access to the App, Our Content, and any Member Content, as well as these Terms are governed and interpreted by the laws of the State of New York, other than such laws, rules, regulations and case law that would result in the application of the laws of a jurisdiction other than the State of New York.

Dkt. No. 43-1 § 12 ("Terms").

The Terms also require Plaintiffs to agree to certain limits on express or implied warranties:

SHOULD APPLICABLE LAW NOT PERMIT THE FOREGOING EXCLUSION OF EXPRESS OR IMPLIED WARRANTIES, THEN WE GRANT THE MINIMUM EXPRESS OR IMPLIED WARRANTY REQUIRED BY APPLICABLE LAW.

Id. § 7. Bumble also requires its users to "comply with all applicable laws, including without limitation, privacy laws, intellectual property laws, anti-spam laws, equal opportunity laws and regulatory requirements[.]" Id. § 3.

B. Procedural Background

On November 13, 2018, Plaintiffs filed their complaint, alleging claims under: (1) California's Dating Service Law, Cal. Civ. Code §§ 1694 et seq. ; (2) Consumer Legal Remedies Act ("CLRA"), Cal. Civ. Code §§ 1750 et seq. , for violation of the Automatic Renewal Law ("Renewal Law"), Cal. Bus. & Prof. Code § 17602 ; (3) CLRA for violation of the Dating Service Law; (4) Unfair Competition Act ("UCL"), Cal. Bus. & Prof. Code §§ 17200 et seq. ; (5) declaratory judgment; and (6) money had and received. See Dkt. No. 1 ¶¶ 105–51.

Plaintiffs later filed a second amended complaint alleging the same claims. See Dkt. No. 43. Bumble now moves to dismiss. See Dkt. No. 44. The motion is fully briefed and the Court held a hearing on June 5, 2019. See Dkt. Nos. 46, 49, 51. All parties have consented to the jurisdiction of a magistrate judge. See Dkt. Nos. 11, 21.

II. Legal Standard

A motion to dismiss for failure to state a claim under Rule 12(b)(6) tests the legal sufficiency of a complaint. Navarro v. Block , 250 F.3d 729, 732 (9th Cir. 2001). On a motion to dismiss, all allegations of material fact are taken as true and construed in the light most favorable to the non-movant. Cahill v. Liberty Mut. Ins. Co. , 80 F.3d 336, 337–38 (9th Cir. 1996). The Court, however, need not accept as true "allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." In re Gilead Scis. Secs. Litig. , 536 F.3d 1049, 1055 (9th Cir. 2008). Although a complaint need not allege detailed factual allegations, it must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A claim is facially plausible when it "allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

III. Discussion

Bumble seeks to enforce the choice of law provision in its Terms and moves to dismiss Plaintiffs' California law claims. Plaintiffs argue that the choice of law provision is unenforceable. First, they argue, the choice of law provision is ambiguous. Second, Plaintiffs contend that their claims fall outside the scope of the choice of law provision. Finally, Plaintiffs argue that the choice of law provision is unenforceable under California's choice-of-law framework. The Court addresses each argument in turn before deciding whether Plaintiffs have stated a claim.

A. Choice of Law

Federal courts sitting in diversity apply the laws of the forum state when analyzing choice of law provisions. First Intercontinental Bank v. Ahn , 798 F.3d 1149, 1153 (9th Cir. 2015). Plaintiffs brought suit in the Northern District of California, so California law regarding choice of law provisions applies.

California has a strong public policy favoring enforcement of choice of law provisions. Nedlloyd Lines B.V. v. Super. Ct. , 3 Cal. 4th 459, 465, 11 Cal.Rptr.2d 330, 834 P.2d 1148 (1992). California courts analyze choice of law provisions using the framework set out in Restatement (Second) of Conflict of Laws § 187. Nedlloyd , 3 Cal. 4th at 464, 11 Cal.Rptr.2d 330, 834 P.2d 1148.

[T]he proper approach ... is for the court first to determine either: (1) whether the chosen state has a substantial relationship to the parties or their transaction, or (2) whether there is any other reasonable basis for the parties' choice of law. If neither of these tests is met, that is the end of the inquiry, and the court need not enforce the parties' choice of law. If, however, either test is met, the court must next determine whether the chosen state's law is contrary to a fundamental policy of California. If there is no such conflict, the court shall enforce the parties' choice of law. If, however, there is a fundamental conflict with California law, the court must then determine whether California has a "materially greater interest than the chosen state in the determination of the particular issue ...." If California has a materially greater interest than the chosen state, the choice of law shall not be enforced, for the obvious reason that in such circumstance we will decline to enforce a law contrary to this state's fundamental policy.

Id. (internal citations omitted).

Before proceeding to the Nedlloyd test, however, the Court must first determine whether the Terms even apply to Plaintiffs' claims. To that end, Plaintiffs contend that the Terms are ambiguous and their claims fall outside the ambit of the choice of law provision.

1. Ambiguity

As noted above, Plaintiffs first argue that the Court should not enforce the choice of law provision because it is ambiguous and arguably incorporates California law. See Dkt. No 46 at 16. According to Plaintiffs, the Terms' repeated references to "applicable law" throughout the contract suggests that the choice of law provision is unclear as to which states' laws actually govern the Terms. The Court disagrees.

Plaintiffs rely solely on Sutter Home Winery, Inc. v. Vintage Selections, Ltd. , 971 F.2d 401 (9th Cir. 1992). In Sutter Homes , the contract at issue repeatedly invoked "applicable law" throughout. See 971 F.2d at 406. However, unlike the Terms here, the use of the phrase "applicable law" in Sutter specifically referenced local...