United States District Court, N.D. California, San Jose Division
IN RE SAMSUNG GALAXY SMARTPHONE MARKETING AND SALES PRACTICES LITIGATION
ORDER GRANTING WITH LEAVE TO AMEND MOTION TO DISMISS
FIRST AMENDED CONSOLIDATED CLASS ACTION COMPLAINT [RE: ECF
LABSON FREEMAN, UNITED STATES DISTRICT JUDGE.
putative consumer class action, Plaintiffs Demetrius Martin,
Omar Atebar, Esther Vega, Jesus Vega, Lizett Anguiano, Tomas
Hernandez, Greg Robison, Dale Holzworth, Eric Pirverdian,
Tomig Salmasian, Michael Kouyoumdjian, Dior Dee, Cory
Raymond, and Jesus Sanchez (collectively,
“Plaintiffs”) assert claims against Samsung
Electronics America, Inc. and Samsung Electronics Co., Ltd.
(collectively, “Samsung”) for alleged defects in
their phones. In a separate order, the Court concludes that
certain Plaintiffs agreed to arbitrate their dispute with
Samsung. Here, the Court addresses Samsung's Motion to
Dismiss the First Amended Consolidated Class Action
Complaint, Mot., ECF 69, for Plaintiffs whose phones are not
subject to arbitration. For the reasons stated on the record
at the March 29, 2018 hearing and summarized below, the Court
GRANTS WITH LEAVE TO AMEND Samsung's motion to dismiss.
Court offers a very brief factual and procedural background.
For purposes of this order, four phones are at issue-the
Galaxy S7 (“S7”), the Galaxy S6
(“S6”), the Galaxy S6 Edge (“S6
Edge”), and the Galaxy Note5 (“Note5”). In
the First Amended Consolidated Class Action Complaint
(“FAC”), ECF 65, Plaintiffs allege that these
phones “pose a risk of overheating, fire and
explosion” based in part on Samsung's recall of the
Samsung Galaxy Note7. FAC ¶ 37.
bring causes of action for violations of California,
Massachusetts, and Maryland consumer-protection laws as well
as unjust enrichment. FAC ¶¶ 143-85, 198-201.
Samsung moved to compel arbitration on the ground that
Plaintiffs assented to an arbitration clause. ECF 67. In a
concurrently filed order, the Court concludes that the phones
of the Massachusetts Plaintiff and some of the California
Plaintiffs are subject to arbitration, and the Court grants a
stay of the proceedings pending arbitration. Here, the Court
addresses Samsung's motion to dismiss as to the remaining
Plaintiffs-namely, Maryland Plaintiff Robison and California
Plaintiffs Atebar (as to the Note5), Jesus Vega, Anguiano,
Hernandez, Pirverdian, Salmasian, Dee, and Sanchez.
moves to dismiss Maryland Plaintiff Robison's claims on
the ground that he has failed to sufficiently allege that
this Court may exercise personal jurisdiction over Samsung.
Mot. 7-8. The Court agrees that the present allegations are
insufficient to establish either general or specific
jurisdiction over Samsung Electronics America or Samsung
may exercise general jurisdiction only when the
defendant's “affiliations with the State are so
‘continuous and systematic' as to render [the
defendant] essentially at home in the forum State.”
Daimler AG v. Bauman, 134 S.Ct. 746, 754 (2014)
(quoting Goodyear Dunlop Tires Operations, S.A. v.
Brown, 564 U.S. 915, 919 (2011)). For corporate
defendants, like the Samsung entities, the place of
incorporation and the principal place of business are the
paradigm places for general jurisdiction. Id. at
760. Here, those locations are not in California-Samsung
Electronics Co. is headquartered and incorporated in the
Republic of Korea, and Samsung Electronics America is
headquartered in New Jersey and incorporated in New York. FAC
¶¶ 25- 26. Although Plaintiffs plead that both
Samsung entities “conduct substantial business in
California, ” id. ¶¶ 7-8, the
Supreme Court has recognized that general jurisdiction does
not lie just because a defendant “engages in a
substantial, continuous, and systematic course of
business” in the forum. See Daimler, 134 S.Ct.
at 761 (citations omitted). Plaintiffs fall short of showing
that this Court may properly exercise general jurisdiction
have Plaintiffs sufficiently alleged that this Court may
exercise specific jurisdiction over Samsung for Plaintiff
Robison's claims. Specific jurisdiction is based on the
defendant's connections to the state with regard to the
particular controversy at issue. Bristol-Myers Squibb Co.
v. Superior Court of California, San Francisco County,
137 S.Ct. 1773, 1780-81 (2017); Walden v. Fiore, 134
S.Ct. 1115, 1121 (2014) (“[T]he defendant's
suit-related conduct must create a substantial connection
with the forum State.”). In Bristol-Myers, the
Supreme Court held that non-forum residents in a mass tort
action had not established specific jurisdiction over the
defendant as to their state-law claims alleging that they had
been injured by the defendant's drug. 137 S.Ct. at 1782.
Specifically, the Court reasoned that the non-residents'
suit was not sufficiently connected to the forum because the
non-residents did not allege that they had bought or been
injured by the drug in the forum or that the defendant
created or manufactured the drug in the forum. Id.
at 1781-82. Plaintiff Robison's contacts are
indistinguishable: he is a Maryland resident who purchased
his S6 in Maryland and suffered all of his injuries in
Maryland. FAC ¶ 16. He also seeks to represent a class
of plaintiffs who reside in and purchased their phones in
Maryland. Id. ¶ 107. With regard to Plaintiff
Robison's claims, specific jurisdiction is lacking
because the FAC does not allege that Samsung performed any
relevant action in California.
note that Bristol-Myers involved a state mass
action, whereas this case involves a federal class action.
Whether Bristol-Myers applies to federal class
actions is an open question. See In re Nexus 6P Prod.
Liab. Litig., No. 17-CV-02185-BLF, 2018 WL 827958, at *3
n.2 (N.D. Cal. Feb. 12, 2018). However, Plaintiffs identify
no authority where a court has determined that
Bristol-Myers does not apply to a named plaintiff
seeking to represent a statewide class of non-forum residents
proceeding under non-forum law. Indeed, one of
Plaintiffs' cited cases distinguishes between named and
unnamed plaintiffs. Fitzhenry-Russell v. Dr. Pepper
Snapple Grp., Inc., No. 17-CV-00564 NC, 2017 WL 4224723,
at *5 (N.D. Cal. Sept. 22, 2017). At this stage, this Court
is inclined to conclude that named Maryland Plaintiff Robison
must satisfy the standards set forth in
Bristol-Myers, particularly because the Court's
authority to hear this case under Federal Rule of Civil
Procedure 4(k)(1)(A) is derivative of California's
long-arm statute. The Court therefore GRANTS Samsung's
motion to dismiss Plaintiff Robison's claims for lack of
personal jurisdiction. Nevertheless, given that the law is still
evolving in this area, the Court is willing to consider any
developments that take place during the pendency of the stay.
Article III Standing
raises two successful challenges to Article III
standing. First, Plaintiff Jesus Vega lacks Article
III standing to sue. Mot. 8-9. Unlike most of the other
Plaintiffs, Plaintiff Jesus Vega does not allege that he
“purchased” his phone; instead, the FAC provides
that he “came into possession” of a Note5. FAC
¶ 13. As explained in a separate submission to the
Court, Plaintiff Atebar purchased the device for Jesus Vega,
and Jesus Vega pays one-third of the monthly cost for
T-Mobile phone service. Murphy Decl., ECF 75-2, Ex. 2
¶¶ 2-3. On these facts, Plaintiff Jesus Vega has
not established that he suffered any concrete injury in fact
caused by Samsung's conduct. See Lujan v. Defs. of
Wildlife, 504 U.S. 555, 560 (1992). The FAC does not
plead that the overheating defect interfered with Plaintiff
Jesus Vega's phone service, FAC ¶ 83, but that is
all that Plaintiff Jesus Vega paid for. Instead, as
Plaintiffs appear to acknowledge in their opposition, the
phone purchaser (Plaintiff Atebar) is the appropriate person
to pursue claims that the Note5 is defective. Accordingly,
the Court GRANTS Samsung's motion to dismiss Plaintiff
Jesus Vega's claims.
no Plaintiff adequately establishes standing to seek
injunctive relief. Mot. 11-12. After Plaintiffs filed their
FAC, the Ninth Circuit decided Davidson v. Kimberly-Clark
Corp., 873 F.3d 1103 (9th Cir. 2017). There, the court
identified two circumstances in which a consumer misled by
false advertising may demonstrate standing for prospective
relief: (1) “she will be unable to rely on the
product's advertising or labeling in the future, and so
will not purchase the product although she would like
to” and (2) “she might purchase the product in
the future, despite the fact it was once marred by false
advertising or labeling, as she may reasonably, but
incorrectly, assume the product was improved.”
Id. at 1115. Plaintiffs' allegations do not fit
within either of those categories or otherwise provide that
Plaintiffs “suffer[ed] an ‘actual ...