United States District Court, S.D. California
SAEID AZIMPOUR, on behalf of himself and all others similarly situated, Plaintiff,
SEARS, ROEBUCK & COMPANY, Defendant.
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT
SEARS, ROEBUCK & COMPANY'S MOTION TO DISMISS (ECF NO.
JANIS L. SAMMARTINO, UNITED STATES DISTRICT JUDGE
before the Court is a Motion to Dismiss or, in the
Alternative, Strike Plaintiff's Second Amended Complaint
Pursuant to Federal Rules of Civil Procedure 12(b)(1),
12(b)(6), and 12(f) filed by Defendant Sears, Roebuck &
Company (“Sears”). (“MTD, ” ECF No.
26.) Also before the Court is Plaintiff's Response in
Opposition to, (“Opp'n, ” ECF No. 27), and
Defendant's Reply in Support of, (“Reply, ”
ECF No. 28), Defendant's MTD. The Court vacated the
hearing on the MTD and took it under submission pursuant to
Civil Local Rule 7.1(d)(1). (ECF No. 29.) Having considered
the parties' arguments and the law, the Court GRANTS IN
PART and DENIES IN PART Defendant's MTD.
action arose after Plaintiff purchased a pillow at
Defendant's store in San Diego, California on July 19,
2015. (Second Amended Compl. (“SAC”) ¶¶
9, 29, ECF No. 25.) At the store, Plaintiff saw pricing
information indicating that the pillow's
“regular” price was $19.99, but was being offered
at a “sale” price of $9.99. (Id.)
Specifically, Mr. Azimpour examined the price sign bearing
the original price and also examined the red sign, with black
letters announcing, “Sale” and stating
“Save $10.” (Id.; see also Id.
Ex. B (a pricing sign that Azimpour describes as nearly
identical to the price sign he observed when making his
purchase).) The Sale Sign announced the discounted price of
$9.99 and the regular price was described immediately next to
it as, “reg. $19.99.” (Id.) Plaintiff
relied on this purported discounted price in making his
purchase, (id.), and claims he would not have
purchased the pillow but-for the misrepresented price,
(id. ¶¶ 9, 29, 33). Additionally, upon
check-out on July 19, 2015, Sears provided Plaintiff with a
receipt containing the allegedly misrepresented price,
specifically stating “SALE” in large, bold,
all-caps lettering directly above the item he purchased.
(Id. ¶ 31.) Plaintiff alleges that Defendant
has employed a scheme to defraud consumers by advertising
merchandise at fabricated “sale” prices.
(See, e.g., id. ¶¶ 1, 2, 3, 4,
32.) Plaintiff now also alleges that his “counsel's
investigation has revealed” that the pillow Plaintiff
purchased remained continuously on “sale” at
every Sears store in San Diego County for the same price from
the filing of this suit through November 8, 2016.
(Id. ¶ 11; see also Id. ¶¶
19-28 (detailing Plaintiff's counsel's
January 15, 2016, Plaintiff filed his Amended Complaint
(“FAC”) seeking a class action against Defendant
for false and misleading advertisements in connection with
merchandise sold in its retail stores. (FAC ¶ 1, ECF No.
10.) The Court dismissed Plaintiff's FAC for failure to
plead with particularity under Rule 9(b). (See First
MTD Order, ECF No. 22.)
filed his SAC on November 8, 2016. Plaintiff brings the same
six causes of action, including: (1) violation of Unfair
Competition Law-unlawful acts (“UCL, ” Cal. Bus.
& Prof. Code § 17200, et seq.) on behalf of
the California Class; (2) violation of UCL-unfair acts (Bus.
& Prof. Code § 17200, et seq.) on behalf of
the California Class; (3) violation of the California False
Advertising Law (“FAL, ” Cal. Bus. & Prof.
Code § 17500, et seq.) on behalf of the
California Class; (4) violation of the Consumers Legal
Remedies Act (“CLRA, ” California Civil Code
§ 1750, et seq.) on behalf of the California
Class; (5) Unjust Enrichment on behalf of the California
Class; and (6) violations of the Consumer Protection Laws on
behalf of Classes in states with similar laws. (See
generally SAC, ECF No. 25.)
now moves to dismiss or, in the alternative, strike
Plaintiff's SAC on various grounds. (See
generally MTD, ECF No. 26.) The Court considers each
argument in turn.
TO DISMISS PURSUANT TO RULE 12(b)(1)
courts are courts of limited jurisdiction, and as such have
an obligation to dismiss claims for which they lack
subject-matter jurisdiction. Demarest v. United
States, 718 F.2d 964, 965 (9th Cir. 1983). Because the
issue of standing pertains to the subject-matter jurisdiction
of a federal court, motions raising lack of standing are
properly brought under Federal Rule of Civil Procedure
12(b)(1). White v. Lee, 227 F.3d 1214, 1242 (9th
Cir. 2000). The plaintiff bears the burden of establishing he
has standing to bring the claims asserted. Takhar v.
Kessler, 76 F.3d 995, 1000 (9th Cir. 1996); see also
In re Dynamic Random Access Memory (DRAM) Antitrust
Litig., 546 F.3d 981, 984 (9th Cir. 2008) (“The
party asserting jurisdiction bears the burden of establishing
subject matter jurisdiction on a motion to dismiss for lack
of subject matter jurisdiction.”).
12(b)(1) motions may challenge jurisdiction facially or
factually. 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. By contrast, in a factual attack, the
challenger disputes the truth of the allegations that, by
themselves, would otherwise invoke federal
jurisdiction.” Id. Here, Defendant's
challenge is facial because it disputes whether
Plaintiff's alleged harm is sufficiently particularized
to confer Article III standing as well as statutory standing
under the UCL and FAL. Defendant does not rely upon extrinsic
evidence, but instead relies only on the pleadings.
Accordingly, the Court will assume the truth of
Plaintiff's factual allegations, and draw all reasonable
inferences in favor of Plaintiff. Whisnant v. United
States, 400 F.3d 1177, 1179 (9th Cir. 2005); Safe
Air for Everyone, 373 F.3d at 1039.
Article III Standing
Article III of the United States Constitution, a federal
court may only adjudicate an action if it constitutes a
justiciable “case” or a “controversy”
that has real consequences for the parties. Raines v.
Byrd, 521 U.S. 811, 818 (1997); Lujan v. Defenders
of Wildlife, 504 U.S. 555, 560 (1992). A threshold
requirement for justiciability in federal court is that the
plaintiff have standing to assert the claims brought.
Id.; see also DaimlerChrysler Corp. v.
Cuno, 547 U.S. 332, 342 (2006) (“Article III
standing . . . enforces the Constitution's
case-or-controversy requirement.”) (citations omitted).
As the sole proposed class representative, Plaintiff
has the burden of showing that Article III standing exists in
this case. Ellis v. Costco Wholesale Corp., 657 F.3d
970, 978 (9th Cir. 2011).
essence of the standing inquiry is to determine whether the
party seeking to invoke the Court's jurisdiction has
“alleged such a personal stake in the outcome of the
controversy as to assure that concrete adverseness which
sharpens the presentation of issues upon which the court so
largely depends.” Baker v. Carr, 369 U.S. 186,
204 (1962). Three elements form the core of the standing
First, the plaintiff must have suffered an “injury in
fact”-an invasion of a legally protected interest which
is (a) concrete and particularized, and (b) actual or
imminent, not conjectural or hypothetical. Second, there must
be a causal connection between the injury and the conduct
complained of-the injury has to be fairly . . . traceable to
the challenged action of the defendant, and not . . . the
result of the independent action of some third party not
before the court. Third, it must be likely, as opposed to
merely speculative, that the injury will be redressed by a
Lujan, 504 U.S. at 560-61 (quotations, citations,
and footnote omitted). This irreducible constitutional
minimum, often termed “Article III standing, ”
seeks to limit the reach of the judiciary into matters
properly reserved for other branches of government. See
DaimlerChrysler, 547 U.S. at 341; see also Valley
Forge Christian Coll. v. Ams. United for Separation of Church
and State, Inc., 454 U.S. 464, 474 (1982). Although the
Supreme Court has noted that “the concept of
‘Art. III standing' has not been defined with
complete consistency, ” Valley Forge, 454 U.S.
at 475, these three “bedrock” requirements of
injury, causation, and redressability are uniformly essential
to federal court jurisdiction. Raines, 521 U.S. at
818-20; see also Bennett v. Spear, 520 U.S. 154,
Statutory Standing Under the UCL and FAL
under the UCL and FAL is further limited to any person
“who has suffered injury in fact and has lost money or
property” as a result of unfair competition. Cal. Bus.
& Prof. Code §§ 17204, 17535; see also
Kwikset Corp. v. Superior Court., 51 Cal.4th 310, 321
(2011). To plead standing under the UCL, a party must
“(1) establish a loss or deprivation of money or
property sufficient to qualify as injury in fact, i.e.,
economic injury, and (2) show that that economic
injury was the result of, i.e., caused by, the
unfair business practice or false advertising that is the
gravamen of the claim.” Kwikset, 51 Cal.4th at
322 (emphasis in original).
Court previously found that Plaintiff had, at minimum,
“standing to sue for his alleged injury based solely on
the in-store advertisement he relied on in making his pillow
purchase.” (First MTD Order 8, ECF No. 22.) Because
Plaintiff failed to plead his fraud claims with
particularity, the Court declined “to rule on whether
Plaintiff has standing to sue on behalf of others who have
similarly relied on misrepresented pricing
information.” (Id.) The Court finds that this
time around Plaintiff has pled with sufficient particularity
his fraud claims under Rule 9(b) and thus now considers
Defendant's arguments regarding standing.
argues that Plaintiff lacks standing for a variety of
reasons, including that he lacks standing to (1) represent
individuals who relied on anything other than in-store
advertisements; (2) represent a class of individuals that
purchased different products than Plaintiff; (3) represent a
class of individuals who purchased a product discounted from
an “original” price; and (4) obtain injunctive
relief. (See generally MTD, ECF No. 26-1.) The Court
considers each argument in turn.
Defendant argues that Plaintiff does not have standing to
raise claims arising from anything other than the in-store
advertising he alleges to have seen. (Id. at 12-13.)
Plaintiff argues that Defendant conflates the standing
inquiry with considerations better suited for class
certification. (MTD Opp'n 14-18, ECF No. 27.)
Additionally, Plaintiff has removed online purchasers from
the class definition, and thus limited the class to in-store
purchasers. (Id. at 17 (citing SAC ¶¶
35-36, ECF No. 25).) In other words, Plaintiff's class is
limited to those who “have been exposed to the same
type of in-store, misleading advertising as Plaintiff.”
Plaintiff's concessions, and because the Court has
already held that Plaintiff adequately alleged actual
reliance based on the causal link between Defendant's
in-store advertising and Plaintiff's alleged economic
injury, (see First MTD Order 7-8, ECF No. 22), the
Court finds that Plaintiff has adequately pled standing to
represent at least a class of purchasers who relied on
in-store advertisements in making their purchase.
Defendant points out that while Plaintiff amended his SAC to
exclude “all online purchasers” from the class
definition, (see SAC ¶ 38, ECF No. 25), he
still seeks to represent a class of individuals that may have
relied on “online promotional materials, in-store
displays, and print advertisements, ” regardless of
where they made their purchase, (id. ¶ 3). The
Court finds Plaintiff's concession that his class is
limited to those who “have been exposed to the same
type of in-store, misleading advertising as Plaintiff,
” (MTD Opp'n 17, ECF No. 27), all but eliminates
to the extent Plaintiff still seeks to incorporate other
media platforms into this case, the Court again finds that
Plaintiff fails to adequately plead reliance on online or
print advertisements, among possible others, for standing
purposes. The Court understands that Plaintiff alleges he and
other putative class members were exposed to a years-long
campaign that might otherwise lessen the significance of the
advertisement form or medium in the standing inquiry.
(See Id. at 16 n.3, ECF No. 27.) But Plaintiff's
allegations of fraud stretch from 2015 through the present
date, which ...