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Brickman v. Fitbit, Inc.

United States District Court, N.D. California

July 15, 2016

JAMES P. BRICKMAN, et al., individually and as a representative of all persons similarly situated, Plaintiffs,
v.
FITBIT, INC., Defendant.

          ORDER RE MOTION TO DISMISS Re: Dkt. No. 63

          JAMES DONATO UNITED STATES DISTRICT JUDGE

         In this putative class action, named plaintiffs James Brickman and Margaret Clingman allege that defendant Fitbit, Inc. (“Fitbit”) misled consumers about the functionality of sleep tracking on its wearable devices. Plaintiffs have gone through a number of pleadings developments and are now on a fourth amended complaint. Dkt. No. 60. Fitbit challenges the complaint for failure to state a plausible claim and other reasons. Dkt. No. 63. The Court took Fitbit’s motion under submission pursuant to Civil Local Rule 7-1(b), and finds that the complaint is sufficient to proceed to the merits. Dismissal is denied.

         BACKGROUND

         Although the current complaint is a fourth amended complaint, the Court has not yet ruled on the adequacy of plaintiffs’ allegations. The amendments were largely the product of voluntary agreements between the parties that are not germane to this motion.

         The gist of the operative complaint is that Fitbit knowingly misled consumers about the utility and efficacy of its sleep tracking functionality. Brickman, a Florida resident, and Clingman, a California resident, each bought a Fitbit “Flex” device that included a sleep tracking feature. Plaintiffs allege that Fitbit materially misrepresented the ability of the Flex -- and all similarly equipped Fitbit devices -- to track “hours slept, ” “times woken up, ” and “sleep quality” through statements and graphics on product packaging and in other places. Dkt. No. 60 ¶¶ 3, 30.

         These statements are false, according to plaintiffs, because Fitbit uses an accelerometer as the platform for its sleep tracking functionality, id. ¶ 34, and accelerometers “can only measure movement and not sleep.” Id. ¶ 4. Plaintiffs cite independent reviews, commentary from sleep doctors, and “anecdotal evidence from consumers” to allege that movement alone does not, and possibly cannot, provide meaningful information or accurate data about the duration or quality of sleep. Id. at ¶¶ 10-11, 38. These sources feature comments like Fitbit’s devices “are not measuring sleep, simply motion, ” “[y]ou cannot infer quality of sleep from motion, ” and the technology only “guesses” the amount of sleep experienced. Id. ¶ 38. Plaintiffs allege that these and other facts show that Fitbit promised a functionality that its devices cannot deliver.

         Plaintiffs state that they “encountered and relied on” Fitbit’s representations about the sleep tracking function in buying their devices. Id. ¶¶ 47, 56. They also say that Fitbit charged a premium of $30 or more for devices equipped with the sleep tracking feature over those without it. Id. ¶ 28.

         Plaintiffs allege nine claims: (1) the Unfair Competition Law, Cal. Bus. & Prof. Code Section 17200 (“UCL”); (2) the False Advertising Law, Cal. Bus. & Prof. Code Section 17500 (“FAL”); (3) the California Consumer Legal Remedies Act, Cal. Civil Code Section 1750 (“CLRA”); (4) the Magnuson-Moss Warranty Act, 15 U.S.C. Section 2301 (“MMWA”); (5) breach of implied warranty, Cal. Civil Code Section 1790; (6) the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”), Fla. Stat. 501.201; (7) common law fraud, (8) negligent misrepresentation, and (9) unjust enrichment/restitution/quasi contract.[1]

         DISCUSSION

         I. LEGAL STANDARDS

         Familiar standards govern Fitbit’s motion to dismiss. To meet the pleading requirements of Federal Rule of Civil Procedure 8(a)(2) and survive a Rule 12(b)(6) motion to dismiss, a plaintiff must allege “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). “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 (2009) (citing Twombly, 550 U.S. at 556). At this stage, the Court accepts all the material allegations in the complaint as true and draws all reasonable inferences in favor of the plaintiffs. Moyo v. Gomez, 32 F.3d 1382, 1384 (9th Cir. 1994). But the Court will not treat as fact or accept as true allegations that are bare legal conclusions, recitations of elements or unwarranted deductions. Iqbal, 556 U.S. at 678; In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008).

         Since this case alleges claims sounding in fraud and deception, Federal Rule of Civil Procedure 9(b) also applies. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103-04 (9th Cir. 2003); Kearns v. Ford Motor Co., 567 F.3d 1120, 1125-26 (9th Cir. 2009). Rule 9(b) requires that “[i]n alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake.” This means the allegations must “be specific enough to give defendants notice of the particular misconduct . . . so that they can defend against the charge and not just deny that they have done anything wrong, ” and the “[a]verments of fraud must be accompanied by ‘the who, what, when, where, and how’ of the misconduct charged.” Vess, 317 F.3d at 1106 (internal quotation marks omitted). In addition, the “‘plaintiff must set forth what is false or misleading about a statement, and why it is false.’” Ebeid ex rel. United States v. Lungwitz, 616 F.3d 993, 998 (9th Cir. 2010) (quoting Vess, 317 F.3d at 1106). Mechanical or conclusory allegations of fraud will not do. Moore v. Kayport Package Exp., Inc., 885 F.2d 531, 540 (9th Cir. 1989). The elements of “[m]alice, intent, knowledge, and other conditions of a person’s mind” may be alleged generally. Fed.R.Civ.P. 9(b); see also Vess, 317 F.3d at 1104.

         As plaintiffs acknowledge, these requirements apply to the UCL, FAL, CLRA, FDUTPA, and common law misrepresentation claims in the complaint (and arguably to the warranty claims too, although Fitbit does not make that point), all of which are grounded on the allegation that Fitbit misled consumers about the sleep tracking functionality. Dkt. No. 60; Dkt. No. 67 at 11-13.

         II.THE CONSUMER ...


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