United States District Court, E.D. California
alleges he entered into a contract and paid a $100, 000 down
payment to purchase a limited edition aircraft from
defendant, but defendant now refuses to honor the
parties' agreement. Defendant moves to dismiss
plaintiff's complaint. As explained below, the court
GRANTS the motion.
Samer Bishay is a Canadian citizen. Compl., ECF No. 1, ¶
2. Defendant ICON Aircraft, Inc. is a Delaware corporation
with its headquarters and principal place of business in
Vacaville, California. Id. ¶ 3. ICON
manufacturers an experimental light-sport aircraft: the ICON
A5. Id. ¶ 5. The A5 is a two-seat, light-sport
aircraft designed to take off from and land on water.
Id. ¶ 6. The A5 is the only product ICON
manufactures and no other manufacturer makes a similar
aircraft. Id. ¶¶ 6, 7.
February 14, 2011, plaintiff executed an ICON A5 Limited
Edition Aircraft Deposit Agreement, under which plaintiff
agreed to pay a $100, 000 deposit to ICON to purchase one of
the first 100 limited edition A5s ICON would manufacture.
Id. ¶ 8; Deposit Agreement, Compl. Ex. A, ECF
No. 1-1. Under the deposit agreement, plaintiff would pay a
total price of “$135, 000 Fixed” for his limited
edition A5. Compl. ¶ 8. ICON countersigned the deposit
agreement on February 23, 2011, and plaintiff wired his $100,
000 deposit to ICON's business operations account.
Id. ¶ 10. Plaintiff was then assigned
“purchase slot number 92.” Id. Plaintiff
alleges on information and belief that “ICON solicited
at least $10, 000, 000 in deposits from at least 100
potential purchasers (including Plaintiff), which money was
deposited directly into its operating account and used as
‘seed money' for business development.”
Id. ¶ 12.
the deposit agreement, plaintiff agreed to pre-purchase a
limited edition “Founder's edition A5, ”
which would include “a specialized color scheme, unique
badges and ‘fully-loaded' capabilities.”
Id. ¶ 9. Under the parties' agreement, ICON
would send plaintiff a purchase agreement when it began
manufacturing his plane, which would require plaintiff to
then make certain selections for his limited edition A5 and
also pay the remaining purchase price. Id.
promised plaintiff and other purchasers of the first 100
Founder's Edition A5s that their aircrafts would be
manufactured and delivered in 2011. Id. ¶ 11;
but see Deposit Agreement § 2.2 (“ICON
expects deliveries of the Aircraft to begin in 2011. Actual
production and delivery dates may vary. The scheduled date of
delivery for the Aircraft (“Delivery Date”) shall
be determined by ICON.”). Plaintiff's A5 was not
manufactured or delivered in 2011. Compl. ¶ 13.
2015, though it still had not delivered plaintiff's or
any other purchaser's aircraft, ICON contacted plaintiff
to address “various revisions [ICON] wanted to make to
[plaintiff's] deposit agreement, including (most
importantly) an increase in the price of the aircraft.”
Id. ¶ 14. On December 28, 2015, plaintiff and
ICON executed the “ICON A5 Founder's Edition
Amended and Restated Aircraft Deposit Agreement.”
Id. ¶ 15; Amended Agreement, Compl., Ex. B, ECF
No. 1-2, at 2 (“As a result of changes to ICON's
aircraft design over time, including the expected
incorporation into the base ICON A5 model of items previously
understood to be options, ICON and Buyer desire to enter into
this Deposit Agreement.”). Under the amended agreement,
its terms would supersede and replace the original deposit
agreement. Compl. ¶ 16; Amended Agreement at 2. The
amended agreement did not require plaintiff to submit a
further deposit, but instead applied his $100, 000 deposit
under the original deposit agreement to the amended
agreement. Compl. ¶ 17. The amended agreement also
“purportedly” increased plaintiff's purchase
price to “$220, 000 Fixed.” Id. ¶
18. Plaintiff retained purchase position 92 of the first 100
aircraft produced. Id. He alleges on information and
belief that all other deposit holders also executed new
amended agreements substantively similar to the amended
agreement plaintiff signed. Id. ¶ 21.
the deposit agreement and amended agreement barred the
parties from unilaterally cancelling the contract, instead
providing the contract “remained in force until ICON
sent Plaintiff a ‘Production Notice' indicating
that his aircraft in purchase position 92 was about to
commence manufacture.” Id. ¶ 22. Upon
plaintiff's receipt of a production notice, he would have
21 days to cancel the contract and receive a full refund of
his deposit or execute a purchase agreement. Id.
¶ 23. The purchase agreement would incorporate the terms
of the deposit agreement and provide for payment of the
remaining purchase price. Id.
never sent plaintiff a production notice. Id. ¶
24. Relying on the deposit and amended agreement, however,
plaintiff made arrangements for the eventual delivery of his
aircraft, “including arranging for a United States
registration number for the aircraft with the Federal
Aviation Administration.” Id. ¶ 25.
alleges on information and belief that ICON experienced
manufacturing delays in 2016 and moved its headquarters and
facility to Vacaville, California. Id. ¶ 26. On
May 26, 2016, ICON's CEO, Kirk Hawkins, emailed
plaintiff, “inform[ing] him that customer deliveries
would be shifted again by another year.” Id.
¶ 26. On October 30, 2017, ICON emailed plaintiff,
explaining ICON was increasing the purchase price again and
plaintiff had “forfeited” his purchase position.
Id. ¶ 27. Despite plaintiff informing ICON he
was able and willing to pay the remaining purchase price of
the aircraft, including the amount called for in the amended
agreement, on an unspecified date, “ICON informed
Plaintiff that it could no longer honor either the [deposit
agreement] or the [amended agreement], and that the purchase
price for the A5 aircraft was being increased to at least
$352, 000 for all customers.” Id. ¶ 29.
ICON informed plaintiff he could retain his purchase position
only if he entered into a new deposit agreement and agreed to
pay the new $352, 000 price. Id. ¶ 30. ICON
stated it would refund plaintiff's deposit and cancel his
contract if he did not agree to the new purchase price.
Id. ¶ 30. Plaintiff rejected this offer and
demanded in writing that ICON honor his contract without
increasing the purchase price. Id. ¶ 31. ICON
January 28, 2019, plaintiff sued ICON, alleging breach of
contract and seeking specific performance, violation of the
California Consumer Legal Remedies Act (“CLRA”),
California Civil Code section 1770, and unfair business
practices (“UCL”) under California Business &
Professions Code section 17200. Id. ¶¶
32-53. ICON moves to dismiss the complaint, Mot., ECF No. 11,
plaintiff opposes, Opp'n, ECF No. 13, and ICON filed a
reply, Reply, ECF No. 15. The court submitted the motion
after hearing and resolves it here.
Rule 12(b)(6) of the Federal Rules of Civil Procedure, a
party may move to dismiss a complaint for “failure to
state a claim upon which relief can be granted.” A
court may dismiss “based on the lack of a cognizable
legal theory or the absence of sufficient facts alleged under
a cognizable legal theory.” Balistreri v. Pacifica
Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).
a complaint need contain only “a short and plain
statement of the claim showing that the pleader is entitled
to relief, ” Fed.R.Civ.P. 8(a)(2), in order to survive
a motion to dismiss this short and plain statement
“must contain sufficient factual matter . . . to
‘state a claim to relief that is plausible on its
face.'” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). A complaint must include something
more than “an unadorned,
the-defendant-unlawfully-harmed-me accusation” or
“‘labels and conclusions' or ‘a
formulaic recitation of the elements of a cause of
action.'” Id. (quoting Twombly,
550 U.S. at 555). Determining whether a complaint will
survive a motion to dismiss for failure to state a claim is a
“context-specific task that requires the reviewing
court to draw on its judicial ...