Pruchnicki v. Envision Healthcare Corp.

• Decision Date: 20 February 2020
• Docket Number: Case No. 2:19-CV-1193 JCM (BNW)
• Citation: 439 F.Supp.3d 1226
• Parties: Peggy PRUCHNICKI, Plaintiff(s), v. ENVISION HEALTHCARE CORPORATION, et al., Defendant(s).
• Court: U.S. District Court — District of Nevada

439 F.Supp.3d 1226

Peggy PRUCHNICKI, Plaintiff(s),

v.ENVISION HEALTHCARE CORPORATION, et al., Defendant(s).

Case No. 2:19-CV-1193 JCM (BNW)

United States District Court, D. Nevada.

Signed February 20, 2020

David H. Krieger, Krieger Law Group, LLC, Henderson, NV, Matthew I. Knepper, Miles N. Clark, Knepper & Clark LLC, Las Vegas, NV, for Plaintiff(s).

Amanda M. Perach, Amanda C. Yen, McDonald Carano LLP, Las Vegas, NV, Matthew Pearson, Pro Hac Vice, Casie D. Collignon, Pro Hac Vice, Sammantha Tillotson, Sean B. Solis, Pro Hac Vice, Baker and Hostetler LLP, Denver, CO, for Defendant(s).

ORDER

James C. Mahan, UNITED STATES DISTRICT JUDGE

Presently before the court is defendants Envision Healthcare Corporation d/b/a Envision Healthcare ("Envision"), EmCare, Inc. ("EmCare"), and Sheridan Healthcorp, Inc.'s ("Sheridan") (collectively, "defendants") motion to dismiss. (ECF No. 18). Plaintiff Peggy Pruchnicki ("plaintiff") filed a response (ECF No. 23), to which defendants did not reply.

Also before the court is defendants' motion to dismiss plaintiff's second amended complaint. (ECF No. 27). Plaintiff filed a response (ECF No. 31), to which defendants replied (ECF No. 36).

I. Background

The instant putative class action arises from a data breach. (ECF No. 26). Plaintiff brings claims for negligence, breach of implied contract, negligent misrepresentation, and violation of Nevada Revised Statute ("NRS") § 41.600 on behalf of herself and "[a]ll persons whose [p]ersonal [d]ata was procured by a third party as a result of the [d]ata [b]reach due to the Envision Defendants' failure to secure its internal systems of record."¹ Id. at 12.

Plaintiff provided her personal and/or financial information to defendants. Id. at 3. In July 2018, defendants' systems were breached by an unidentified third party, who was allegedly able to procure plaintiff's name, date of birth, social security number, driver's license number, and unidentified "financial information." Id. Defendants did not notify the individuals whose information was compromised until October 10, 2018, at which time they indicated that such information "may" have been compromised. Id. at 4. On February 29, 2019, defendants determined that plaintiff's information had been compromised. Id. at 5. Plaintiff did not receive notice that her information had, in fact, been compromised until May 3. Id.

Although plaintiff has not suffered identity theft or fraud, she alleges that such criminal activity is "imminent and certainly impending." Id. at 8. On that basis, plaintiff brought her claims in Nevada state court (ECF No. 1-1), and defendants timely removed the action (ECF No. 1).

II. Legal Standard

A court may dismiss a complaint for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). A properly pled complaint must provide "[a] short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2) ; Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). While Rule 8 does not require detailed factual allegations, it demands "more than labels and conclusions" or a "formulaic recitation of the elements of a cause of action." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citation omitted).

"Factual allegations must be enough to rise above the speculative level." Twombly , 550 U.S. at 555, 127 S.Ct. 1955. Thus, to survive a motion to dismiss, a complaint must contain sufficient factual matter to "state a claim to relief that is plausible on its face." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (citation omitted).

In Iqbal , the Supreme Court clarified the two-step approach district courts are to apply when considering motions to dismiss. First, the court must accept as true all well-pled factual allegations in the complaint; however, legal conclusions are not entitled to the assumption of truth. Id. at 678–79, 129 S.Ct. 1937. Mere recitals of the elements of a cause of action, supported only by conclusory statements, do not suffice. Id. at 678, 129 S.Ct. 1937.

Second, the court must consider whether the factual allegations in the complaint allege a plausible claim for relief. Id. at 679, 129 S.Ct. 1937. A claim is facially plausible when the plaintiff's complaint alleges facts that allow the court to draw a reasonable inference that the defendant is liable for the alleged misconduct. Id. at 678, 129 S.Ct. 1937.

Where the complaint does not permit the court to infer more than the mere possibility of misconduct, the complaint has "alleged—but not shown—that the pleader is entitled to relief." Id. (internal quotation marks omitted). When the allegations in a complaint have not crossed the line from conceivable to plausible, plaintiff's claim must be dismissed. Twombly , 550 U.S. at 570, 127 S.Ct. 1955.

The Ninth Circuit addressed post- Iqbal pleading standards in Starr v. Baca , 652 F.3d 1202, 1216 (9th Cir. 2011). The Starr court stated, in relevant part:

First, to be entitled to the presumption of truth, allegations in a complaint or counterclaim may not simply recite the elements of a cause of action, but must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively. Second, the factual allegations that are taken as true must plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation.

Id.

III. Discussion

As an initial matter, the court notes that plaintiff filed her second amended complaint on August 26, 2019. (ECF No. 26). Thus, the court denies defendants' motion to dismiss the prior complaint as moot. (ECF No. 18). The court now turns to defendants' motion to dismiss the operative complaint.

The instant case falls within the ambit of recent data breach litigation across the country, and the instant motion embraces a developing area of law. See, e.g., In re Zappos.com, Inc. , 888 F.3d 1020 (9th Cir. 2018), cert. denied sub nom. Zappos.com, Inc. v. Stevens , ––– U.S. ––––, 139 S. Ct. 1373, 203 L.Ed.2d 609 (2019) ; Dieffenbach v. Barnes & Noble, Inc. , 887 F.3d 826 (7th Cir. 2018) ; In re Horizon Healthcare Servs. Inc. Data Breach Litig. , 846 F.3d 625 (3d Cir. 2017) ; In re SuperValu, Inc. , 870 F.3d 763 (8th Cir. 2017) ; Attias v. Carefirst, Inc. , 865 F.3d 620 (D.C. Cir. 2017) ; Remijas v. Neiman Marcus Grp., LLC , 794 F.3d 688 (7th Cir. 2015) ; Reilly v. Ceridian Corp. , 664 F.3d 38 (3d Cir. 2011) ; Krottner v. Starbucks Corp. , 628 F.3d 1139 (9th Cir. 2010) ; Pisciotta v. Old Nat. Bancorp , 499 F.3d 629 (7th Cir. 2007) ; In re Anthem, Inc. Data Breach Litig. , 162 F. Supp. 3d 953 (N.D. Cal. 2016).

In the wake of the Supreme Court's decisions in Spokeo, Inc. v. Robins , ––– U.S. ––––, 136 S. Ct. 1540, 194 L.Ed.2d 635 (2016), as revised (May 24, 2016), and Clapper v. Amnesty Int'l USA , 568 U.S. 398, 133 S.Ct. 1138, 185 L.Ed.2d 264 (2013), many defendants facing data-breach cases disputed plaintiffs' standing to bring their claims. But the Supreme Court has not provided guidance on standing issues specifically in the data-breach context. Instead, standing arguments in data-breach cases have been left to the circuit courts, where they have been met with mixed success. The D.C., Sixth, Seven, and Ninth Circuits have held that data-breach plaintiffs alleging future harm have standing. See, e.g., In re Zappos.com, Inc. , 888 F.3d 1020 (holding that data-breach plaintiffs alleging future harms have standing); Dieffenbach , 887 F.3d 826 (same); Attias , 865 F.3d 620 (same); Galaria v. Nationwide Mut. Ins. Co. , 663 F. App'x 384 (6th Cir. 2016) (same). On the other hand, the First, Second, Third, Fourth, and Eighth Circuits have not. See, e.g., In re SuperValu, Inc. , 870 F.3d 763 (affirming dismissal for lack of standing); In re Horizon Healthcare Servs. Inc. Data Breach Litig. , 846 F.3d 625 (same); Reilly , 664 F.3d 38 (same); Whalen v. Michaels Stores, Inc. , 689 F. App'x 89 (2d Cir. 2017) (same).

While the circuits remain split on the issue, this court is bound by Ninth Circuit precedent. The Ninth Circuit in In re Zappos.com, Inc. expressly held that "[a] plaintiff threatened with future injury has standing to sue if the threatened injury is certainly impending, or there is a substantial risk that the harm will occur." 888 F.3d at 1024 (quoting Susan B. Anthony List v. Driehaus , 573 U.S. 149, 134 S.Ct. 2334, 2341, 189 L.Ed.2d 246 (2014) ) (internal quotation marks omitted).

But, as the Eighth Circuit advised, "it is crucial ... not to conflate Article III's requirement of injury in fact with a plaintiff's potential causes of action, for the concepts are not coextensive." Carlsen v. GameStop, Inc. , 833 F.3d 903, 909 (8th Cir. 2016) (citation, alteration, and quotation marks omitted); see also Bond v. United States , 564 U.S. 211, 218, 131 S.Ct. 2355, 180 L.Ed.2d 269 (2011) ("Even though decisions ... have been careful to use the terms ‘cause of action’ and ‘standing’ with more precision, the distinct concepts can be difficult to keep separate."). Thus, while threatened future injury satisfies the "injury in fact" requirement for standing to bring a claim, the issue of damages as an element thereof is a separate, albeit analogous, inquiry. Unfortunately, there is little authority—whether in this circuit or others—to provide guidance on this issue.

Defendants concede that plaintiff has standing to bring her claims. (ECF No. 27). They instead argue instead that plaintiff has not alleged cognizable damages as an element of her negligence, breach of implied contract, negligent misrepresentation, and NRS 41.600 claims. Id. And, to be sure, plaintiff must prove damages to prevail on any of those claims. Sanchez ex rel. Sanchez v. Wal-Mart Stores, Inc. , 125 Nev. 818, 221 P.3d 1276, 1280 (2009) ("[T]o prevail on a negligence claim, a plaintiff must establish ... damages.");...