The opinion of the court was delivered by: Hon. Michael M. Anello United States District Judge
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS [Doc. No. 47]
Pending before the Court is Defendants' Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 47.) On August 9, 2010, the Court held a hearing on the motion. (Doc. No. 55.) Attorney Brian Lake appeared on behalf of Plaintiff InfoSonics Corporation, and Attorney Peter Yu appeared on behalf of the LG Defendants. After hearing argument on the motion, the Court took the matter under submission. Having considered the briefing and arguments presented, and for the reasons stated herein, the Court GRANTS IN PART and DENIES IN PART Defendants' Motion to Dismiss.
Plaintiff InfoSonics Corporation ("InfoSonics") is a distributor of wireless handsets to mobile network carriers in Latin America and the Carribean, with its headquarters located in San Diego, California. LG manufactures wireless handsets and arranges for placement of the wireless handsets in various regions around the world through its various wholly-owned subsidiaries. In addition to distributing wireless handsets, InfoSonics works with the carrier and manufacturer to enable handsets to work on different wireless networks by technically modifying the handsets and customizing the software required for different customers in different regions.
In 2006, InfoSonics began purchasing LG handsets from LG Panama to distribute to Latin American mobile network carriers. In 2007, the parties began negotiating a long-term distribution agreement by which InfoSonics would distribute LG handsets for LG Panama to its Latin American contacts. Sometime after InfoSonics began distribution in certain Latin American countries for LG Panama, InfoSonics began also distributing handsets for LG Guatemala and LG Chile in other Latin American countries such as El Salvador and Honduras. While still negotiating the terms of the distribution agreement, Plaintiff continued to purchase and distribute LG's handsets pursuant to the terms of purchase orders it issued out of its San Diego headquarters. Sometime during 2008, negotiations deteriorated, and LG Panama informed InfoSonics that it would not enter into a distribution agreement with it.
Plaintiff alleges that LG Panama thereafter began selling its handsets to at least two of InfoSonics's customers directly. Plaintiff alleges that LG Guatemala also stopped dealing with InfoSonics and instead began selling its handsets directly to at least two other InfoSonics customers. Plaintiff alleges that, from the beginning, LG Panama entered into the business arrangement with Infosonics with the "devious, undisclosed intent of 'cutting out' InfoSonics and selling directly to InfoSonics' already established customer base." Plaintiff also alleges that LG Electronics and LG US are liable because they directed LG Panama and LG Guatemala to engage in this conduct.
On July 1, 2009, Plaintiff filed the instant action in the Superior Court of the State of California, County of San Diego. On July 31, 2009, Defendants removed the action to federal court and the action was randomly assigned to the undersigned judge. (Doc. No. 1.) On January 15, 2010, the Court issued an order granting in part and denying in part Defendants' motion to dismiss. (Doc. No. 30.) Specifically, the Court denied Defendant's motion to dismiss LG Chile and LG Guatemala for insufficient service of process on grounds that these were foreign Defendants, and Plaintiff was in the process of having the Defendants served via diplomatic processes. The Court also denied Defendants' motion to dismiss LG Panama, LG Guatemala, and LG Chile for lack of personal jurisdiction on grounds that each entity had sufficient contacts with California to support specific personal jurisdiction. The Court denied Defendants' motion to dismiss six of the nine causes of action for failure to state a claim under Florida law on grounds that California law, rather than Florida law, governed the action. The Court, however, dismissed all claims against LG Electronics, LG US, LG Guatemala, and LG Chile because Plaintiff only referred to these Defendants in the Complaint collectively, thus failing to comply with Rule 8 requirements. Finally, the Court denied Defendants' motion to dismiss Plaintiff's fraud claim against LG Panama and LG Electronics on grounds that Plaintiff adequately pled fraud under the standards of Federal Rule of Civil Procedure 9(b).
On March 1, 2010, Plaintiff filed its First Amended Complaint. (Doc. No. 31.) The parties then stipulated to Plaintiff's filing of a Second Amended Complaint ("SAC"), which Plaintiff thereafter filed on April 23, 2010. (Doc. No. 44.)*fn1 On June 2, 2010, Defendants filed the instant motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (Doc. No. 47.) On June 23, 2010, Plaintiff filed its opposition to the motion, and on July 2, 2010, Defendants replied. (Doc. Nos. 50, 53.)*fn2
A complaint survives a motion to dismiss if it contains "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). The court reviews the contents of the complaint, accepting all factual allegations as true, and drawing all reasonable inferences in favor of the nonmoving party. Knievel v. ESPN, 393 F.3d 1068, 1072 (9th Cir. 2005). Notwithstanding this deference, the reviewing court need not accept "legal conclusions" as true. Ashcroft v. Iqbal, -- U.S. -- , 129 S.Ct. 1937, 1949 (2009). Moreover, it is improper for a court to assume "the [plaintiff] can prove facts that [he or she] has not alleged."Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 526 (1983). Accordingly, a reviewing court may begin "by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth." Ashcroft, supra, 129 S.Ct. at 1950.
"When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id. 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." Id. at 1949. "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. "Where a complaint pleads facts that are 'merely consistent with' a defendant's liability, it 'stops short of the line between possibility and plausibility of entitlement to relief.'" Id. (citing Twombly, 550 U.S. at 557).
Defendants assert multiple bases for dismissal of claims alleged by Plaintiff in the SAC. First, Defendants contend that Plaintiff's claims for intentional interference against LG Electronics should be dismissed for failure to state a claim on grounds that Plaintiff fails to identify facts to support its contention that LG Electronics directed the activities of LG Panama or LG Guatemala. Second, Defendants contend that Plaintiff has not identified any promises LG Electronics made to Plaintiff that could support its claim for promissory estoppel. Finally, Defendants contend that all claims against LG US should be dismissed for failure to state a claim because Plaintiff alleges no specific facts to support its conclusory assertion that LG US directed the activities of LG ...