Moore v. Angie's List, Inc.

• Decision Date: 07 August 2015
• Docket Number: Civil Action No. 15–1243.
• Citation: 118 F.Supp.3d 802
• Parties: Janell MOORE, on Behalf of Herself and All Others Similarly Situated, v. ANGIE'S LIST, INC.
• Court: U.S. District Court — Eastern District of Pennsylvania

118 F.Supp.3d 802

Janell MOORE, on Behalf of Herself and All Others Similarly Situated,

v.ANGIE'S LIST, INC.

Civil Action No. 15–1243.

United States District Court, E.D. Pennsylvania.

Signed Aug. 7, 2015.

Kenneth J. Grunfeld, Ruben Honik, Richard M. Golomb, Golomb & Honik Pc., David J. Stanoch, Dechert LLP, Philadelphia, PA, for Janell Moore, on Behalf of Herself and All Others Similarly Situated.

Franco A. Corrado, J. Gordon Cooney, Jr., Morgan Lewis & Bockius LLP, Philadelphia, PA, for Angie's List, Inc.

ORDER

Stewart Dalzell, District Judge.

AND NOW, this 7th day of August, 2015, upon consideration of defendant Angie's List's motion to dismiss (docket entry # 10) and the plaintiff's opposition thereto, it is hereby ORDERED that:

1. Angie's List's motion to file a reply brief is GRANTED;

2. Angie's List's motion to dismiss is GRANTED IN PART and DENIED IN PART as follows;

3. Angie's List's motion to dismiss Moore's complaint for lack of standing is DENIED;

4. Angie's List's motion to dismiss Moore's breach of contract claim is DENIED;

5. Angie's List's motion to dismiss Moore's breach of the covenant of good faith and fair dealing is GRANTED;

6. Angie's List's motion to dismiss Moore's unjust enrichment claim is GRANTED;

7. Angie's List's motion to dismiss Moore's fraud claim is DENIED;

8. Angie's List's motion to dismiss Moore's claim pursuant to Pennsylvania's Unfair Trade Practices and Consumer Protection Law is DENIED;

9. By noon on August 13, 2015, the parties shall jointly ADVISE the Court by facsimile (215–580–2156) whether mediation before the Honorable Jacob P. Hart would likely be productive; and

10. Further scheduling shall ABIDE receipt of the parties' facsimile.

MEMORANDUM

Janell Moore sued the popular consumer-review site Angie's List, Inc. ("Angie's List") alleging its practices deceive consumers and seeking class action status for her four claims for relief. Before us is defendant Angie's List's motion to dismiss this putative class action and nominal plaintiff Janell Moore's opposition thereto.

Moore is a Pennsylvania citizen and Angie's List is a Delaware corporation with its principal place of business in Indianapolis, Indiana. Accordingly, we have jurisdiction over this matter pursuant to 28 U.S.C. § 1332.

For the reasons detailed below, we conclude that Moore has standing to pursue her claims and we will deny Angie's List's motion to dismiss pursuant to Rule 12(b)(1). We will also deny the defendant's motion to dismiss Moore's fraud and unfair trade practices claims and her breach of contract claim. However, we will grant defendant's motion to dismiss plaintiff's unjust enrichment claim and her claim of a breach of the covenant of good faith and fair dealing.

I. Standard of Review

A. Motion to Dismiss Under Rule 12(b)(1)

A motion to dismiss for want of standing is properly brought pursuant to Rule 12(b)(1) because standing is a jurisdictional matter. Constitution Party of Pennsylvania v. Aichele, 757 F.3d 347, 357 (3d Cir.2014) (internal citation omitted).

A district court considering a motion pursuant to Rule 12(b)(1) must first determine whether that motion presents a "facial" attack or a "factual" attack on the claim at issue "because that distinction determines how the pleading must be reviewed." Id. A facial challenge contests the sufficiency of the complaint because of a defect on its face—such as lack of diversity among the parties or the absence of a federal question. See Mortensen v. First Federal Sav. and Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977). In a facial challenge, we must consider the allegations of the complaint as true and consider only those allegations in the complaint, and the documents attached thereto, in the light most favorable to the plaintiff to see whether the plaintiff has sufficiently alleged a basis for subject-matter jurisdiction. See Gould Electronics Inc. v. United States, 220 F.3d 169, 176 (3d Cir.2000) ; see also United States ex rel. Atkinson v. PA. Shipbuilding Co., 473 F.3d 506, 514 (3d Cir.2007) (terming a facial attack as "an alleged pleading deficiency"). Thus we apply the identical standard of review that we use in considering a motion to dismiss under Rule 12(b)(6).

A factual attack, on the other hand, challenges the actual failure of the plaintiff's claims to "comport with the jurisdictional prerequisites." PA. Shipbuilding, 473 F.3d at 514. Such an evaluation may occur at any stage of the proceeding, but only once the defendant has filed an answer. Mortensen, 549 F.2d at 891. When a Court is confronted with a factual attack, "[it] is free to weigh the evidence and satisfy itself as to the existence of its power to hear the case," and the plaintiff bears the burden of showing that jurisdiction does in fact exist. Id. Thus, a district court may consider evidence outside the pleadings, Gould Elecs. Inc., 220 F.3d at 176 (internal citation omitted), and no presumptive truthfulness attaches to the plaintiff's allegations, such that the existence of disputed material facts does not preclude a Court from evaluating the merits of jurisdictional claims. Mortensen, 549 F.2d at 891.

B. Motion to Dismiss Under Rule 12(b)(6)

A defendant moving to dismiss under Fed.R.Civ.P. 12(b)(6) bears the burden of proving that a plaintiff has failed to state a claim for relief. See Fed.R.Civ.P. 12(b)(6) ; see also Hedges v. United States, 404 F.3d 744, 750 (3d Cir.2005). A Rule 12(b)(6) motion tests the sufficiency of the allegations contained in the complaint and "[t]he question, then, is whether the facts alleged in the complaint, even if true, fail to support the claim." Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir.1993) (internal citation and quotation marks omitted). As the Supreme Court held in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), and Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), in order to survive a Rule 12(b)(6) motion "a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face’," Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955 ). A claim is plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged," Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.

Our Court of Appeals obliges district courts considering a motion to dismiss under Fed.R.Civ.P. 12(b)(6) to engage in a two-part analysis:

First, the factual and legal elements of a claim should be separated. The district court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions. Second, a district court must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a plausible claim for relief.

Fowler v. UPMC Shadyside, 578 F.3d 203, 210–11 (3d Cir.2009) (quoting Iqbal, 556 U.S. at 679, 129 S.Ct. 1937 ).

When deciding a Rule 12(b)(6) motion to dismiss, the Court generally looks to the facts alleged in the complaint and its attachments, without reference to any other part of the record.See Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994). However, we may consider "the allegations contained in the complaint, exhibits attached to the complaint and matters of public record," and any "undisputedly authentic document that a defendant attaches as an exhibit to a motion to dismiss if the plaintiff's claims are based on the document." Pension Benefits Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993).

All well-pleaded allegations of the complaint must be taken as true and interpreted in the light most favorable to the plaintiff and all inferences must be drawn in his or her favor. See McTernan v. City of York, PA., 577 F.3d 521, 526 (3d Cir.2009) (internal quotation marks omitted). To survive a motion to dismiss, a plaintiff must allege facts that "raise a right to relief above the speculative level on the assumption that the allegations in the complaint are true (even if doubtful in fact)." Victaulic Co. v. Tieman, 499 F.3d 227, 234 (3d Cir.2007) (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ).

II. Factual and Procedural Background

We draw our recitation of the facts from Moore's complaint.

Angie's List operates a paid-membership review service on which consumers rate local service providers whose ranking, it boasts, "is determined by their recent grades and number of reviews. Companies with the best ratings from members will appear first." Complaint at ¶¶ 2, 3.¹ The service also states that "service providers cannot influence their ratings on Angie's List," and "businesses don't pay," part of its "unwavering commitment to placing the interests of the consumer first." Id. at ¶ 4.² The gravamen of Moore's complaint is that, contrary to these public representations, Angie's List conceals from consumers that service providers can influence their ratings (by paying to either appear higher in rankings or suppress negative reviews) and that it alters rankings by suppressing positive reviews unless a service provider buys advertising, which Moore alleges can reach "tens of thousands of dollars per provider." Complaint at ¶¶ 7, 11, 14, 36. These undisclosed practices, she alleges, "deceive[ ], defraud[ ], and mislead[ ] its existing and potential member base," id. at ¶¶ 16, 37, and "violate the principles set forth in the FTC guidelines on advertising and endorsements." Id. at ¶ 16. She brings suit on behalf of a putative national class of plaintiffs for (1) breach of contract and of the covenant of good faith and fair dealing, (2) fraud and fraudulent inducement, and (3) unjust enrichment. Additionally, she seeks relief on behalf of a putative class of Pennsylvania residents under Pennsylvania's Unfair Trade Practices and Consumer Protection Law ("UTPCPL"). Id. at ¶¶ 69–107.

Angie's List operates a paid-membership service...