Sciacca v. Apple, Inc.

• Decision Date: 25 January 2019
• Docket Number: Case No. 18-CV-03312-LHK
• Citation: 362 F.Supp.3d 787
• Court: U.S. District Court — Northern District of California
• Parties: Kenneth SCIACCA, Plaintiff, v. APPLE, INC., Defendant.

362 F.Supp.3d 787

Kenneth SCIACCA, Plaintiff,

v.APPLE, INC., Defendant.

Case No. 18-CV-03312-LHK

United States District Court, N.D. California, San Jose Division.

Signed January 25, 2019

James C. Shah, Shepherd Finkelman Miller & Shah, LLP, Media, PA, Kolin C. Tang, Shepherd Finkelman Miller & Shah, LLP, San Francisco, CA, for Plaintiff.

David J. Lender, Pro Hac Vice, Allison Heather Semaya, Pro Hac Vice, Weil Gotshal & Manges, LLP, New York, NY, David Ramraj Singh, Hong-An Tran, Weil, Gotshal and Manges LLP, Redwood Shores, CA, for Defendant.

ORDER GRANTING MOTION TO DISMISS AMENDED COMPLAINT

Re: Dkt. No. 35

LUCY H. KOH, United States District Judge

Plaintiff Kenneth Sciacca brings suit individually and on behalf of various putative classes ("Plaintiff") against Defendant Apple, Inc. ("Apple"). Plaintiff asserts a multitude of claims relating to Apple Watches, which allegedly contain a defect that causes the Watches' screen to crack, shatter, or detach. Before the Court is Apple's motion to dismiss Plaintiff's amended complaint. ECF No. 35 ("Mot."). Having considered the parties' submissions, the relevant law, and the record in this case, the Court GRANTS Apple's motion to dismiss the amended complaint.

I. BACKGROUND

A. Factual Background

Apple first began to sell its Watches in April 2015, when Apple introduced its First Generation of Watches. ECF No. 28 at ¶ 2 ("AC"). Since then, Apple has released the Series 1, Series 2, and the Series 3 Watches. Id. Plaintiff complains that the Series 1, Series 2, and Series 3 Watches contain a defect because the Watch screens are cracking, shattering, or detaching from the Watch bodies. Id. at ¶¶ 5, 7. Plaintiff claims that "Apple has actively concealed and failed to disclose the Defect." Id. at ¶ 8.

Plaintiff, a Colorado resident, purchased his Series 2 Stainless Steel 38mm Apple Watch on or about December 1, 2016. Id. at ¶¶ 16, 47. He did so after reviewing Apple's promotional materials for Series 2 Watches, which advertised the Watch as a good compliment to sporting activities such as swimming, running, and biking. Id. at ¶ 46. However, on or about March 9, 2018, the screen on Plaintiff's Watch detached from the Watch body. Id. at ¶ 48. Plaintiff took his broken Watch to an Apple Store in Lone Tree, Colorado, where Apple Store employees informed Plaintiff that the damage was not covered by the limited warranty and that he had to pay $ 249 to repair the Watch. Id. Plaintiff declined to have his watch repaired, explaining that "[i]n the event that Plaintiff decides to have the repair done, he (as do other members of the Class) would still run the risk of future harm as the repaired Watch would also be prone to the same Defect described herein." Id. Plaintiff alleges that his experience "is identical to the experiences of thousands of Apple Watch owners." Id. at ¶ 50. Plaintiff cites consumer complaints posted on Apple's online forum to suggest that Apple had knowledge of the alleged defect. Id. at ¶ 50, 53 ("[C]onsumers' complaints at Apple Stores, to Apple Support, and online leave no doubt that Apple is fully aware of the Defect.").

Plaintiff notes that Apple provides a limited warranty for purchasers of the Watch, which covers the "product against manufacturing defects beginning on the original purchase date." Id. at ¶ 34. The warranty is one year for most models of the Watch, including the one that Plaintiff purchased. Id. Apple warrants the Watches "against defects in materials and workmanship when used normally in accordance with Apple's published guidelines." Id. at ¶ 35. The limited warranty also "disclaims all statutory and implied warranties, including without limitations, warranties of merchantability and fitness for a particular purpose...." Id. n.7 (linking to "Apple One (1) Year Limited Warranty").

B. Procedural History

On June 4, 2018, Plaintiff filed the instant suit against Apple. ECF No. 1. In response, Apple filed a first motion to dismiss. ECF No. 21. Instead of responding to Apple's motion to dismiss, Plaintiff amended his complaint on August 31, 2018. ECF No. 28. The Court denied Apple's motion to dismiss as moot on September 5, 2018. ECF No. 32.

Apple filed the instant motion to dismiss on September 28, 2018. ECF No. 35. On October 19, 2018, Plaintiff filed his opposition. ECF No. 48 ("Opp."). On November 2, 2018, Apple filed its reply. ECF No. 49 ("Reply").

II. LEGAL STANDARD

A. Motion to Dismiss Under Federal Rule of Civil Procedure 12(b)(6)

Rule 8(a)(2) of the Federal Rules of Civil Procedure requires a complaint to include "a short and plain statement of the claim showing that the pleader is entitled to relief." A complaint that fails to meet this standard may be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). The U.S. Supreme Court has held that Rule 8(a) requires a plaintiff to plead "enough facts to state a claim to relief that is plausible on its face."

Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that 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). "The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (internal quotation marks omitted). For purposes of ruling on a Rule 12(b)(6) motion, the Court "accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party." Manzarek v. St. Paul Fire & Marine Ins. Co. , 519 F.3d 1025, 1031 (9th Cir. 2008).

The Court, however, need not accept as true allegations contradicted by judicially noticeable facts, see Shwarz v. United States , 234 F.3d 428, 435 (9th Cir. 2000), and it "may look beyond the plaintiff's complaint to matters of public record" without converting the Rule 12(b)(6) motion into a motion for summary judgment, Shaw v. Hahn , 56 F.3d 1128, 1129 n.1 (9th Cir. 1995). Nor must the Court "assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Fayer v. Vaughn , 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam) (internal quotation marks omitted). Mere "conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss." Adams v. Johnson , 355 F.3d 1179, 1183 (9th Cir. 2004).

B. Motion to Dismiss Under Federal Rule of Civil Procedure 9(b)

Claims sounding in fraud are subject to the heightened pleading requirements of Federal Rule of Civil Procedure 9(b). Bly-Magee v. California , 236 F.3d 1014, 1018 (9th Cir. 2001). Under the federal rules, a plaintiff alleging fraud "must state with particularity the circumstances constituting fraud." Fed. R. Civ. P. 9(b). To satisfy this standard, the allegations must be "specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they have done anything wrong." Semegen v. Weidner , 780 F.2d 727, 731 (9th Cir. 1985). Thus, claims sounding in fraud must allege "an account of the time, place, and specific content of the false representations as well as the identities of the parties to the misrepresentations." Swartz v. KPMG LLP , 476 F.3d 756, 764 (9th Cir. 2007). In other words, "[a]verments of fraud must be accompanied by ‘the who, what, when, where, and how’ of the misconduct charged." Vess v. Ciba-Geigy Corp. USA , 317 F.3d 1097, 1106 (9th Cir. 2003) (citation omitted). The plaintiff must also plead facts explaining why the statement was false when it was made. See In re GlenFed, Inc. Sec. Litig. , 42 F.3d 1541, 1549 (9th Cir. 1994) (en banc), superseded by statute on other grounds as stated in Marksman Partners, L.P. v. Chantal Pharm. Corp. , 927 F.Supp. 1297 (C.D. Cal. 1996).

"When an entire complaint ... is grounded in fraud and its allegations fail to satisfy the heightened pleading requirements of Rule 9(b), a district court may dismiss the complaint...." Vess , 317 F.3d at 1107. The Ninth Circuit has recognized that "it is established law in this and other circuits that such dismissals are appropriate," even though "there is no explicit basis in the text of the federal rules for the dismissal of a complaint for failure to satisfy 9(b)." Id. A motion to dismiss a complaint "under Rule 9(b) for failure to plead with particularity is the functional equivalent of a motion to dismiss under Rule 12(b)(6) for failure to state a claim." Id.

C. Motion to Dismiss under Rule 12(b)(1)

A defendant may move to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. While lack of statutory standing requires dismissal for failure to state a claim under Rule 12(b)(6), lack of Article III standing requires dismissal for want of subject matter jurisdiction under Rule 12(b)(1). See Maya v. Centex Corp. , 658 F.3d 1060, 1067 (9th Cir. 2011). "A Rule 12(b)(1) jurisdictional attack may be facial or factual." Safe Air for Everyone v. Meyer , 373 F.3d 1035, 1039 (9th Cir. 2004). "In a facial attack, the challenger asserts that the allegations contained in a complaint are insufficient on their face to invoke federal jurisdiction." Id. The Court "resolves a facial attack as it would a motion to dismiss under Rule 12(b)(6) : Accepting the plaintiff's allegations as true and drawing all reasonable inferences in the plaintiff's favor, the court determines whether the allegations are sufficient as a legal matter to invoke the court's jurisdiction." Leite v. Crane Co. , 749 F.3d 1117, 1121 (9th Cir. 2014). "[I]n a factual attack," on the other hand, "the challenger disputes the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction." Safe Air for...