Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 1 of 36 Page ID #:329 1 GLENN D. POMERANTZ (SBN 112503) glenn.pomerantz@mto.com 2 MELINDA E. LEMOINE (SBN 235670) melinda.lemoine@mto.com 3 MUNGER, TOLLES & OLSON LLP 355 South Grand Avenue, 35th Fl. 4 Los Angeles, California 90071-1560 Telephone: (213) 683-9100 5 Facsimile: (213) 687-3702 6 ROSEMARIE T. RING (SBN 220769) rosemarie.ring@mto.com 7 MUNGER, TOLLES & OLSON LLP 560 Mission Street, 27th Fl. 8 San Francisco, CA 94105-2907 Telephone: (415) 512-4000 9 Facsimile: (415) 512-4977 10 Attorneys for Defendants BUENA VISTA HOME ENTERTAINMENT, INC.; THE 11 WALT DISNEY COMPANY; WARNER BROS. ENTERTAINMENT INC.; 12 WARNER BROS. HOME ENTERTAINMENT INC.; UNIVERSAL 13 STUDIOS HOME ENTERTAINMENT LLC; PARAMOUNT PICTURES 14 CORPORATION; SONY PICTURES ENTERTAINMENT INC.; SONY 15 PICTURES HOME ENTERTAINMENT INC. 16 UNITED STATES DISTRICT COURT 17 CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION 18 19 20 CHRISTINE ANTHONY, et al., Plaintiffs, 21 22 vs. BUENA VISTA HOME 23 ENTERTAINMENT INC., et al. 24 Defendants. 25 Case No. 2:15-cv-09593-SVW-JPR STUDIOS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE 12(B)(6) AND 9(B) Date: March 21, 2016 Time: 1:30 pm Place: Courtroom 6, 2nd Floor Judge: Hon. Stephen V. Wilson 26 27 28 STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 2 of 36 Page ID #:330 1 2 NOTICE OF MOTION AND MOTION PLEASE TAKE NOTICE that on March 21, 2016 or as soon thereafter as the 3 matter may be heard, in Courtroom No. 6, United States Courthouse, 255 East 4 Temple Street, Los Angeles, California, 90012, before the Honorable Stephen V. 5 Wilson, Defendants Buena Vista Home Entertainment, Inc.; The Walt Disney 6 Company; Warner Bros. Entertainment Inc., erroneously sued as Warner Bros. 7 Entertainment, Inc.; Warner Bros. Home Entertainment Inc., erroneously sued as 8 Warner Home Entertainment, Inc.; Universal Studios Home Entertainment LLC; 9 Paramount Pictures Corporation; and Sony Pictures Home Entertainment Inc. (the 10 “Studios”) will, and hereby do, move the Court for an order dismissing all causes of 11 action of the Plaintiffs’ Complaint pursuant to Federal Rule of Civil Procedure 12 12(b)(6) for failure to state a claim upon which relief can be granted, and pursuant to 13 Federal Rule of Civil Procedure 9(b) for failure to allege fraud with sufficient 14 particularity. 15 This Motion is based upon this Notice of Motion; the attached Memorandum 16 of Points and Authorities; Plaintiffs’ Complaint; and any argument at a hearing of 17 this matter. 18 The Motion is made following the conference of counsel pursuant to Local 19 Rule 7-3, which took place on January 12, 2016. 20 DATED: January 20, 2016 MUNGER, TOLLES & OLSON LLP 21 22 23 24 25 26 27 28 By: /s/ Glenn D. Pomerantz GLENN D. POMERANTZ Attorneys for Defendants BUENA VISTA HOME ENTERTAINMENT, INC.; THE WALT DISNEY COMPANY; WARNER BROS. ENTERTAINMENT INC.; WARNER BROS. HOME ENTERTAINMENT INC.; UNIVERSAL STUDIOS HOME ENTERTAINMENT LLC; PARAMOUNT PICTURES CORPORATION; SONY PICTURES ENTERTAINMENT INC.; SONY PICTURES HOME ENTERTAINMENT INC. STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 3 of 36 Page ID #:331 TABLE OF CONTENTS 1 Page 2 3 4 5 6 I. INTRODUCTION ............................................................................................. 1 II. SUMMARY OF ALLEGATIONS ................................................................... 3 III. LEGAL STANDARD ....................................................................................... 5 IV. ARGUMENT .................................................................................................... 6 7 A. 8 Plaintiffs’ Misrepresentation Claims Should Be Dismissed ................... 6 1. Plaintiffs Do Not Allege Any Representation That Is “Likely to Deceive” Reasonable Consumers ............................... 6 10 2. Plaintiffs Do Not Adequately Allege Reliance ............................ 8 11 3. Plaintiffs’ Claims Do Not Satisfy Rule 9(b)............................... 10 12 4. Plaintiffs Do Not Plead “Unfair” or “Unlawful” Conduct ......... 12 9 B. 13 Plaintiffs’ Warranty Claims Should Be Dismissed............................... 13 14 1. Plaintiffs Do Not Allege a “Sale” of “Consumer Goods” .......... 13 15 2. Plaintiffs Do Not Allege Facts Showing That the Challenged Movies and TV Shows Are Unmerchantable.......... 15 3. Plaintiffs Do Not Allege Facts Showing a “Particular Purpose” Requiring That All Song Lyrics Be Captioned or Subtitled or That the Studios Knew of Any Such Purpose ........ 16 4. Plaintiffs Do Not Allege Any Purchases in California............... 16 16 17 18 19 C. Plaintiffs’ Unruh Act Claim Should Be Dismissed Because They Do Not Allege Intentional Discrimination............................................ 17 D. Plaintiffs’ Complaint Suffers From Numerous Other Deficiencies ..... 19 20 21 22 1. Plaintiffs Lack Standing to Bring Misrepresentation Claims Based on Movies or TV Shows They Did Not Purchase ...................................................................................... 19 2. Under Choice-of-Law Principles, Plaintiffs’ Individual UCL, CLRA and FAL Claims Should Be Dismissed, and the Class Claims Should Be Limited to California Purchases .................................................................................... 20 3. Plaintiffs Lack Standing to Obtain Equitable Relief .................. 25 23 24 25 26 27 V. CONCLUSION ............................................................................................... 25 28 -iSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 4 of 36 Page ID #:332 1 TABLE OF AUTHORITIES Page 2 3 FEDERAL CASES 4 In re 5-hour ENERGY Mktg. and Sales Practices Litig., No. MDL 13–2438 PSG, 2014 WL 5311272 (C.D. Cal. Sept. 4, 5 2014) ................................................................................................................. 9, 11 6 Anunziato v. eMachines, Inc., 7 402 F. Supp. 2d 1133 (C.D. Cal. 2005) .......................................................... 14, 16 8 Aurigemma v. Arco Petrol. Prods., 9 734 F. Supp. 1025 (D. Conn. 1990) ..................................................................... 23 10 Avedisian v. Mercedes-Benz USA, LLC, 11 43 F. Supp. 3d 1071, 1079 (C.D. Cal. 2014) ........................................................ 15 12 Ball v. AMC Entm’t, Inc., 246 F. Supp. 2d 17 (D.D.C. 2003)........................................................................ 13 13 14 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ............................................................................................... 5 15 16 Bly-Magee v. California, 236 F.3d 1014 (9th Cir. 2001) .............................................................................. 11 17 18 Boris v. Wal-Mart Stores, Inc., 35 F. Supp. 3d 1163, 1171-72 (C.D. Cal. 2014) .................................................. 13 19 Bruno v. Quten Res. Inst., LLC., 20 280 F.R.D. 524 (C.D. Cal. 2011).......................................................................... 20 21 Cruz v. Anheuser-Busch, LLC, 22 No. 14-cv-09670-AB, 2015 WL 3561536 (C.D. Cal. June 3, 2015) ..................... 6 23 Cullen v. Netflix, Inc., 880 F. Supp. 2d 1017 ................................................................................. 5, passim 24 25 Dallas & Lashmi, Inc. v. 7-Eleven, Inc., No. 15-cv-02044-SJO, 2015 WL 3631684 (C.D. Cal. June 10, 2015) ................ 18 26 27 Decker v. GlenFed, Inc. (In re GlenFed, Inc. Sec. Litig.), 42 F.3d 1541 (9th Cir. 1994) (en banc) ................................................................ 12 28 -iiSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 5 of 36 Page ID #:333 1 TABLE OF AUTHORITIES (continued) 2 Page 3 Freeman v. Time, Inc., 68 F.3d 285 (9th Cir. 1995) .................................................................................... 6 4 5 Frenzel v. AliphCom, 76 F. Supp. 3d 999, 1008-09 (N.D. Cal. 2014) .............................................. 21, 22 6 Frezza v. Google Inc., 7 12-cv-000237-RMW, 2013 WL 1736788 (N.D. Cal. Apr. 23, 2013).................. 22 8 Garcia v. Sony Computer Entm’t Am., LLC, 9 859 F. Supp. 2d 1056 (N.D. Cal. 2012).................................................................. 8 10 Gest v. Bradbury, 11 443 F.3d 1177 (9th Cir. 2006) .............................................................................. 25 12 Granfield v. NVIDIA Corp., No. 11-cv-05403-JW, 2012 WL 2847575 (N.D. Cal. July 11, 2012) .................. 19 13 14 Greater L.A. Agency on Deafness, Inc. v. Cable News Network, Inc., 742 F.3d 414 (9th Cir. 2014) ...................................................................... 3, 17, 18 15 16 Grodzitsky v. Am. Honda Motor Co. Inc., No. 2:12-CV-01142-SVW, 2014 WL 718431 (C.D. Cal. Feb. 19, 17 2014) (Wilson, J.) ................................................................................................. 25 18 Grodzitsky v. Am. Honda Motor Co., 19 No. 12-cv-1142-SVW, 2013 WL 2631326 (C.D. Cal. June 12, 2013) (Wilson, J.) ........................................................................................................... 20 20 21 Hairston v. S. Beach Beverage Co., No. 12-cv-1429-JFW, 2012 WL 1893818 (C.D. Cal. May 18, 2012) ................. 19 22 23 In re iPhone 4S Consumer Litig., No. 12-cv-1127-CW, 2013 WL 3829653 (N.D. Cal. July 23, 2013) ................... 15 24 Johns v. Bayer Corp., 25 No. 09-cv-1935-DMS, 2010 WL 476688 (S.D. Cal. Feb. 9, 2010) ..................... 19 26 Kane v. Chobani, Inc., 27 No. 12–cv–02425–LHK, 2013 WL 5289253 (N.D. Cal. Sept. 19, 2013) ..................................................................................................................... 20 28 -iiiSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 6 of 36 Page ID #:334 1 TABLE OF AUTHORITIES (continued) 2 Page 3 Kearns v. Ford Motor Co., 567 F.3d 1120 (9th Cir. 2009) .................................................................. 10, 11, 12 4 5 Keegan v. Am. Honda Motor Co., 838 F. Supp. 2d 929 (C.D. Cal. 2012) .................................................................. 16 6 Kotev v. First Colony Life Ins. Co., 7 927 F. Supp. 1316 (C.D. Cal. 1996) ............................................................... 10, 18 8 MacRae v. HCR Manor Care Servs., 9 No. 14-cv-0715-DOC, 2014 WL 3605893 (C.D. Cal. July 21, 2014) ................... 9 10 Marolda v. Symantec Corp., 11 672 F. Supp. 2d 992 (N.D. Cal. 2009).............................................................. 9, 10 12 Mazza v. Am. Honda Motor Co., Inc., 666 F.3d 581 (9th Cir. 2012) .............................................................. 21, 22, 24, 25 13 14 Miller v. Ghirardelli Chocolate Co., 912 F. Supp. 2d 861 (N.D. Cal. 2012).................................................................. 19 15 16 Mlejnecky v. Olympus Imaging Am. Inc., No. 10-cv-02630-JAM, 2011 WL 1497096 (E.D. Cal. Apr. 19, 17 2011) ............................................................................................................... 19, 20 18 Morgan v. Wallaby Yogurt Co., Inc., 19 No. 13-cv-00296-WHO, 2014 WL 1017879 (N.D. Cal. Mar. 13, 2014) ....................................................................................................................... 9 20 21 Moss v. United States Secret Serv., 572 F.3d 962 (9th Cir. 2009) .................................................................................. 5 22 23 In re NVIDIA GPU Litig., No. 08-cv-04312-JW, 2009 WL 4020104 (N.D. Cal. Nov. 19, 2009) ................. 17 24 Peterson v. Mazda Motor of Am., Inc., 25 44 F. Supp. 3d 965, 972 (C.D. Cal. 2014) ............................................................ 13 26 Route v. Mead Johnson Nutrition Co., 27 No. 12-cv-7350-GW, 2013 WL 658251 (C.D. Cal. Feb. 21, 2013) .................... 19 28 -ivSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 7 of 36 Page ID #:335 1 TABLE OF AUTHORITIES (continued) 2 Page 3 Saavedra v. Eli Lily & Co., No. 12-cv-9366-SVW, 2013 WL 6345442 (C.D. Cal. Feb. 26, 2013) 4 (Wilson, J.) ........................................................................................................... 25 5 In re Sony Gaming Networks & Customer Data Sec. Breach Litig., 6 903 F. Supp. 2d 942 (S.D. Cal. 2012) .................................................................. 24 7 In re Sony PS3 Other OS Litig., 8 551 F. App’x 916 (9th Cir. 2014) ......................................................................... 16 9 Tae Hee Lee v. Toyota Motor Sales, U.S.A., Inc., 992 F. Supp. 2d 962 (C.D. Cal. 2014) .................................................................. 15 10 11 Tietsworth v. Sears, 720 F. Supp. 2d 1123 (N.D. Cal. 2010)................................................................ 14 12 13 In re Toyota Motor Corp., 790 F. Supp. 2d 1152 (C.D. Cal. 2011) .................................................................. 8 14 15 United States v. Wise, 550 F.2d 1180 (9th Cir. 1977) .............................................................................. 14 16 Vess v. Ciba-Geigy Corp. USA, 17 317 F.3d 1097 (9th Cir. 2003) ...................................................................... 2, 5, 11 18 Viggiano v. Hansen Natural Corp., 19 944 F. Supp. 2d 877 (C.D. Cal. 2013) .................................................................. 15 20 Warner v. Tinder Inc., 105 F. Supp. 3d 1083, 1095 (C.D. Cal. 2015) ................................................ 12, 18 21 22 Wilson v. Midway Games, Inc., 198 F. Supp. 2d 167 (D. Conn. 2002) .................................................................. 15 23 24 Winter v. G. P. Putnam’s Sons, 938 F.2d 1033 (9th Cir. 1991) .............................................................................. 15 25 26 STATE CASES 27 Atkinson v. Elk Corp. 109 Cal. App. 4th 739 (2003) ............................................................................... 14 28 -vSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 8 of 36 Page ID #:336 1 TABLE OF AUTHORITIES (continued) 2 Page 3 Bardin v. DaimlerChrysler Corp., 136 Cal. App. 4th 1255 (2006) ........................................................................... 6, 7 4 5 Belton v. Comcast Cable Holdings, LLC, 151 Cal. App. 4th 1224 (2007) ............................................................................. 18 6 Boltz v. Buena Vista Home Entm’t, Inc., 7 No. BC 323842 (Cal. Super. Ct., L.A. Cty., Apr. 20, 2006) .................................. 8 8 Consumer Advocates v. Echostar Satellite Corp., 9 113 Cal. App. 4th 1351 (2003) ......................................................................... 6, 13 10 Fraser Eng’g Co. v. Desmond, 11 524 N.E.2d 110 (Mass. App. Ct. 1988) ................................................................ 22 12 Group Health Plan v. Phillip Morris, Inc., 621 N.W.2d 2 (Minn. 2001) ................................................................................. 22 13 14 Koebke v. Bernardo Heights Country Club, 115 P.3d 1212 (Cal. 2005) ................................................................................ 3, 17 15 16 Kwikset Corp. v. Super. Ct., 51 Cal. 4th 310 (2011) ................................................................................ 9, 10, 20 17 18 Lavie v. Procter & Gamble Co., 105 Cal. App. 4th 496 (2003) ................................................................................. 6 19 Luskin’s Inc. v. Consumer Prot. Div., 20 353 Md. 335 (Md. 1999) ...................................................................................... 24 21 Martinez v. Metabolife Int’l, Inc., 22 113 Cal. App. 4th 181 (2003) ............................................................................... 16 23 Mocek v. Alfa Leisure, Inc., 114 Cal. App. 4th 402 (2003) ............................................................................... 15 24 25 Molo Oil Co. v. River City Ford Truck Sales, Inc., 578 N.W.2d 222 (Iowa 1998) ............................................................................... 23 26 27 RRTM Restaurant Corp. v. Keeping, 766 S.W.2d 804 (Tex. App. 1988) ....................................................................... 23 28 -viSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 9 of 36 Page ID #:337 1 TABLE OF AUTHORITIES (continued) 2 Page 3 In re Tobacco II Cases, 46 Cal. 4th 298 (2009) .................................................................................. 8, 9, 10 4 5 FEDERAL STATUTES 6 17 U.S.C. § 202.......................................................................................................... 14 7 CALIFORNIA STATUTES 8 Cal. Bus. & Prof. Code § 17200 et seq. .......................................................... 1, passim 9 Cal. Bus. & Prof. Code § 17500 et seq. .......................................................... 1, passim 10 Cal. Civ. Code § 51......................................................................................... 2, passim 11 12 Cal. Civ. Code § 1770(A)(5) ..................................................................... 1, 10, 19, 20 13 Cal. Civ. Code § 1780(d) ........................................................................................... 21 14 Cal. Civ. Code § 1791(n) ........................................................................................... 13 15 Cal. Civ. Code. § 1791.1................................................................................. 1, passim 16 Cal. Civ. Code § 1792..................................................................................... 1, passim 17 18 Cal. Civ. Code § 1792.1................................................................................... 2, 13, 16 19 Cal. Civ. Code § 1792.2............................................................................................... 3 20 STATUTES - OTHER 21 Ala. Code 1975 § 8-19-10(f) (2011) .......................................................................... 23 22 Ga. Code Ann. § 10-1-399(a) (2011) ........................................................................ 23 23 La. Rev. Stat. Ann. § 51:1409(A) (2008) .................................................................. 23 24 25 Mass. Gen. Laws Chapter 93A § 9 ............................................................................ 24 26 Mich. Comp. Laws Ann. § 445.911 (2011) ............................................................... 23 27 Mich. Comp. Laws Ann. § 445.911 § 11 (2015) ....................................................... 24 28 Miss. Code Ann. § 75-24-15(4) (2010) ..................................................................... 23 -viiSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 10 of 36 Page ID #:338 1 TABLE OF AUTHORITIES (continued) 2 Page 3 Or. Rev. Stat. Ann. § 646.638 (2011) ........................................................................ 23 4 S.C. Code Ann. § 35-5-140(a) (2010) ....................................................................... 23 5 Tenn. Code Ann. § 47-18-109(g) (2013)................................................................... 23 6 Va. Code Ann. § 59.1-204 (2006) ............................................................................. 23 7 FEDERAL RULES OF CIVIL PROCEDURE 8 9 Fed. R. Civ. P. 9(b) ......................................................................................... 2, passim 10 Fed. R. Civ. P. 12(b)(6) ............................................................................................... 5 11 FEDERAL REGULATIONS 12 47 C.F.R. § 79.1 ........................................................................................................... 8 13 79 Fed. Reg. 17,911 at 17,912 (Mar. 31, 2014) .......................................................... 8 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -viiiSTUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 11 of 36 Page ID #:339 1 I. INTRODUCTION 2 In this putative class action, Plaintiffs challenge captioning and subtitling in 3 movies and TV shows produced and/or distributed by the Studios through theaters, 4 DVDs/Blu-ray discs (“DVDs”), and streaming services. While Plaintiffs admit that 5 the challenged movies or TV shows caption dialogue and some song lyrics, 6 Plaintiffs claims are based on their belief that all song lyrics should be captioned or 7 subtitled as well. According to Plaintiffs, because some but not all song lyrics are 8 captioned or subtitled, Plaintiffs cannot “fully enjoy” the challenged movies and TV 9 shows and are misled by statements describing them as “captioned” or “subtitled” 10 because reasonable consumers expect these terms to include all song lyrics. On this 11 basis, Plaintiffs attempt to assert claims under various California consumer 12 protection, warranty, and civil rights laws. 13 But none of these laws, nor any other law, requires captioning or subtitling 14 across all of these challenged distribution channels, let alone captioning or subtitling 15 of all song lyrics. And Plaintiffs’ own allegations show that reasonable consumers 16 understand that not all song lyrics are captioned or subtitled. Indeed, Plaintiffs 17 admit that the alleged practice of not captioning or subtitling all song lyrics is 18 “frustratingly widespread.” Compl. ¶ 36. At bottom, all of Plaintiffs’ claims should 19 be dismissed because they attempt to distort California’s consumer protection, 20 warranty, and civil rights law to create and impose on the Studios a requirement to 21 caption or subtitle all song lyrics where no such requirement exists. 22 Plaintiffs assert six claims falling into three categories: (1) misrepresentation 23 claims, (2) warranty claims, and (3) a civil rights claim. The misrepresentation 24 claims are based on asserted violations of California’s Unfair Competition Law, Cal. 25 Bus. & Prof. Code § 17200 et seq. (“UCL”), False Advertising Law, Cal. Bus. & 26 Prof. Code § 17500 et seq. (“FAL”), and Consumers Legal Remedies Act, Cal. Civ. 27 Code § 1770(A)(5) (“CLRA”). The warranty claims are based on asserted 28 violations of California’s Song-Beverly Consumer Warranty Act, Cal. Civ. Code. -1STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 12 of 36 Page ID #:340 1 §§ 1791.1, 1792, 1792.1 (“Song-Beverly Act”). The civil rights claim is based on 2 an alleged violation of California’s Unruh Civil Rights Act, Cal. Civil Code § 51 et 3 seq. Plaintiffs have not, and cannot, state any claim for relief under these laws. 4 Misrepresentation Claims. Plaintiffs’ misrepresentation claims fail because 5 they are based on alleged statements that Plaintiffs’ own allegations confirm are not 6 “likely to deceive” any reasonable consumer as a matter of law. Plaintiffs allege 7 that the Studios misrepresent the challenged movies and TV shows by describing or 8 labeling them as containing captions, subtitles, or subtitles for the deaf of hard of 9 hearing. But Plaintiffs admit that the alleged practice of not captioning or subtitling 10 all song lyrics is “frustratingly widespread,” and that they have viewed “numerous” 11 movies and TV shows which were described as containing captions, subtitles, and/or 12 subtitles for the deaf or hard of hearing, yet did not include captioning for all song 13 lyrics. Compl. ¶¶ 1-9, 36. Plaintiffs also cannot plausibly allege reliance on the 14 alleged misrepresentations, which alone requires dismissal of these claims. Rule 15 9(b) also requires dismissal of Plaintiffs’ misrepresentation claims because they are 16 not pleaded with the requisite particularity. Plaintiffs do not identify what 17 statements by the Studios represented that all song lyrics would be captioned or 18 subtitled, where any such statements were made, or how they were misleading given 19 Plaintiffs’ admissions regarding the widespread nature of the challenged practice 20 and their repeated exposure to it. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 21 1105-06 (9th Cir. 2003). 22 Warranty Claims. Plaintiffs’ warranty claims fail because the challenged 23 movies and television shows are not “consumer goods” and do not involve a “sale” 24 within the meaning of the Song-Beverly Act. The Song-Beverly Act applies only to 25 “consumer goods,” which are limited to actual products, not expressive content like 26 movies and TV shows. Even if movies and TV shows are “consumer goods” under 27 the Song-Beverly Act, which they are not, no “sale” of the content occurs because 28 consumers purchase only the “rights” to view the content in theaters, on DVDs or -2STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 13 of 36 Page ID #:341 1 streaming media. Plaintiffs also do not allege facts showing that the challenged 2 movies and TV shows are unfit for their ordinary purpose of providing 3 entertainment because they do not caption or subtitle all song lyrics, see Cal. Civ. 4 Code § 1791.1(a)(2), or that Plaintiffs’ “particular purpose” in viewing them 5 necessitated captioning or subtitling all song lyrics and that the Studios were on 6 notice of that particular purpose. Id. § 1791.1. Plaintiffs’ warranty claims also fail 7 because no Plaintiff alleges any purchase in California. Id. §§ 1792, 1792.2. 8 Unruh Act Claim. Plaintiffs’ Unruh Act claim fails because Plaintiffs do 9 not, and cannot, allege intentional discrimination. California’s Unruh Act prohibits 10 “willful, affirmative misconduct,” and requires Plaintiffs to “plead and prove 11 intentional discrimination in public accommodations.” Koebke v. Bernardo Heights 12 Country Club, 115 P.3d 1212, 1228-29 (Cal. 2005). Plaintiffs claim that the alleged 13 failure to caption or subtitle all song lyrics is “usually (if not always) justif[ied]” by 14 “lack of necessary copyrights.” Compl. ¶ 43. At best, Plaintiffs allege a neutral 15 policy applied equally to everyone, which does not support a cognizable Unruh Act 16 claim. See, e.g., Greater L.A. Agency on Deafness, Inc. v. Cable News Network, 17 Inc., 742 F.3d 414, 426-27 (9th Cir. 2014) (CNN’s “neutral policy” of not 18 captioning any online video programming “applied equally to all CNN.com visitors” 19 and did not violate the Unruh Act). Plaintiffs’ Unruh Act claims also fail because 20 no Plaintiff alleges that he or she was discriminated against in California. Cal. Civ. 21 Code § 51(b). 22 II. SUMMARY OF ALLEGATIONS 23 Plaintiffs “are deaf or hard of hearing and need captioning or subtitling to 24 understand words or lyrics in movies and television shows.” Preamble to Compl. 25 They bring this putative class action on behalf of “[a]ll persons, with any hearing 26 loss and/or impairment, residing in the United States” who: 27 28 -3STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 14 of 36 Page ID #:342 (1) “purchased a ticket to view a movie distributed and/or produced by any Defendant in a theater that was advertised as captioned with the expectation that the movie would be fully captioned”; 1 2 3 (2) “purchased, rented or otherwise obtained a mislabeled DVD product1 distributed and/or produced by any Defendant . . . with the expectation that it contained English subtitles, or subtitles for the Deaf and Hard of Hearing”; or 4 5 6 (3) “purchased or rented via streaming media any movie or show that was advertised as subtitled with the expectation that it contained English subtitles, or subtitles for the Deaf and Hard of Hearing.” 7 8 9 Compl. ¶ 24. Plaintiffs claim that “Defendants mark … movies or shows” they distribute 10 11 “with language, such as captioned, English subtitles, or subtitles for the Deaf and 12 Hard of Hearing, indicating that the movie or show is fully captioned or subtitled.” 13 Compl. ¶ 34. “While the dialogue of some movies or shows are indeed fully 14 subtitled, the practice of not subtitling song/music lyrics is frustratingly 15 widespread.” Compl. ¶ 36. Each Plaintiff alleges that he or she “on several 16 occasions, has purchased and/or rented numerous DVDs, and/or viewed movies in 17 other forums produced or distributed by Defendants,” where content “including 18 music lyrics, was not subtitled or captioned.” Compl. ¶¶ 1-9; see also, e.g., id. ¶ 3 19 (plaintiff Evan Brunell “viewed every pre-Daniel Craig James Bond movie through 20 DVD or streaming” as well as other movies and TV shows; “[i]n all of these films or 21 shows, some or all song lyrics were not captioned or subtitled); id. ¶ 6 (plaintiff 22 Catharine McNally purchased or rented seven movies; “not all of the song lyrics 23 were captioned or subtitled”). The Complaint purports to give examples of “language” “mark[ed]” on the 24 25 movies or shows to indicate they are “fully captioned or subtitled” (Compl. ¶ 34), 26 27 1 Defined as a DVD “marked with English subtitles or subtitles for the Deaf and 28 Hard of Hearing, which contains features that were not subtitled.” Compl. ¶ 24. -4STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 15 of 36 Page ID #:343 1 but it fails to quote any specific representations from DVD boxes, let alone any 2 representation claiming that a movie or show was “fully” captioned or subtitled. 3 Nor does the Complaint quote or identify any representations by the Studios 4 concerning subtitles or captions that allegedly accompanied theatrical screenings or 5 streaming media versions of any movie or TV show. The Complaint does not 6 explain why putative class members would construe general statements “such as 7 captioned, English subtitles, or subtitles for the Deaf and Hard of Hearing” to mean 8 that all song lyrics would be subtitled. It further does not allege that class members 9 relied on this interpretation of any such statement every time they purchased a 10 movie or TV show. The Complaint instead claims: “[a] representation of 11 ‘captioned’ or ‘subtitled’ should include the DVD feature presentation, special 12 features, and music/song lyrics.” Compl. ¶ 39 (emphasis added). 13 III. LEGAL STANDARD 14 A Rule 12(b)(6) motion should be granted unless the complaint alleges 15 “enough” well-pleaded “facts to state a claim to relief that is plausible on its face.” 16 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). The complaint’s “non17 conclusory ‘factual content’” and reasonable inferences therefrom must be 18 “plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. United 19 States Secret Serv., 572 F.3d 962, 968-72 (9th Cir. 2009) (internal citations omitted). 20 Conclusory allegations should be disregarded. See id. 21 Parties “must state with particularity the circumstances constituting fraud or 22 mistake.” Fed. R. Civ. P. 9(b). This includes “‘the who, what, when, where, and 23 how’ of the misconduct charged.” Vess, 317 F.3d at 1105-06 (internal citations 24 omitted). “Rule 9(b)’s heightened pleading standards apply to all UCL, FAL, or 25 CLRA claims that are grounded in fraud.” Cullen v. Netflix, Inc., 880 F. Supp. 2d 26 1017, 1025; see also Vess, 317 F.3d at 1105 (“Fraud can be averred by specifically 27 alleging fraud, or by alleging facts that necessarily constitute fraud (even if the word 28 ‘fraud’ is not used).”). -5STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 16 of 36 Page ID #:344 1 IV. ARGUMENT 2 A. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs’ Misrepresentation Claims Should Be Dismissed 1. Plaintiffs Do Not Allege Any Representation That Is “Likely to Deceive” Reasonable Consumers To state a claim under the UCL, FAL, or CLRA, Plaintiffs must allege a representation or omission that is “likely to deceive” reasonable consumers. Freeman v. Time, Inc., 68 F.3d 285, 289 (9th Cir. 1995) (UCL and FAL); Consumer Advocates v. Echostar Satellite Corp., 113 Cal. App. 4th 1351, 1360 (2003) (CLRA). Statements that could “conceivably be misunderstood by some few consumers viewing it in an unreasonable manner” do not suffice. Lavie v. Procter & Gamble Co., 105 Cal. App. 4th 496, 508 (2003). Instead, Plaintiffs must allege facts from which one can conclude that it is “probable that a significant portion of the general consuming public or of targeted consumers, acting reasonably in the circumstances, could be misled.” Id. Complaints that fail to allege that consumers had any particular “expectation or assumption” that the alleged misrepresentation is deceptive should be dismissed. See, e.g., Cruz v. Anheuser-Busch, LLC, No. 14-cv-09670-AB, 2015 WL 3561536, at *8 (C.D. Cal. June 3, 2015); Bardin v. DaimlerChrysler Corp., 136 Cal. App. 4th 1255, 1275 (2006). For example, in Cruz v. Anheuser-Busch, plaintiffs alleged that the defendant violated the UCL, FAL, and CLRA because defendant advertised certain beverages as “Light” when in fact they contained “more calories and carbohydrates per fluid than any other” product by defendant. 2015 WL 3561536, at *1. The court dismissed these claims, observing that the plaintiffs “fail” in their complaint “to answer a vital question—how many calories and carbohydrates did they expect the Rita Products to contain?” Id. at *8. Absent allegations about the expectations of reasonable consumers, plaintiffs’ claims were premised on nothing more than a “subjective expectation” that defendant’s beverage contains “fewer calories and carbohydrates than it [actually] contains.” Id. “Such subjective -6STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 17 of 36 Page ID #:345 1 expectations” alone were insufficient to state a claim under the UCL, FAL, or 2 CLRA. Id.; accord Bardin, 136 Cal. App. 4th at 1275 (alleged omission not likely 3 to deceive reasonable consumers because plaintiffs failed to allege that they had any 4 “expectation or assumption” about the subject of the omission). 5 Here, Plaintiffs do not, and cannot, allege that reasonable consumers expected 6 the terms “captioned” or “subtitled” to mean that all song lyrics would be captioned. 7 Instead, Plaintiffs assert that consumers are “likely to be deceived” because they 8 “check a movie or show to see” if it is designated as “captioned” or “subtitled” 9 before renting or purchasing it, and that these terms “should include the DVD 10 feature presentation, special features, and music/song lyrics.” Compl. ¶ 39 11 (emphasis added). In other words, Plaintiffs allege that video content marked as 12 “captioned” or “subtitled” should caption all song lyrics, not that reasonable 13 consumers expect it. Plaintiffs’ subjective view that movies and TV shows 14 represented as containing captions and/or subtitles “should” caption or subtitle all 15 song lyrics does not state a claim under the UCL, FAL, or CLRA. 16 Plaintiffs’ own allegations show that neither they nor any reasonable 17 consumer understands the alleged misrepresentations to mean that all song lyrics are 18 captioned or subtitled. Plaintiffs allege that “the practice of not subtitling 19 song/music lyrics is frustratingly widespread,” and that the Studios’ purported 20 “excuse” based on a “lack of necessary copyrights” is irrelevant. Compl. ¶¶ 36, 43.2 21 Furthermore, each of the Plaintiffs alleges that he or she has purchased or rented 22 23 24 25 26 27 28 2 Plaintiffs claim that the copyright “excuse” is “irrelevant to Defendants’ misleading advertising” and “without legal merit.” Compl. ¶ 43. To the extent it informs a widespread industry practice, it is not irrelevant, because it suggests that consumers who are aware of the copyright issues involved do not expect challenged terms like “captioned” to mean that all song lyrics are captioned. As for its legal merit, Plaintiffs minimize a serious issue by suggesting that even if it is a copyright violation, captioning lyrics is fair use—but they cite no case establishing that fair use applies in this context, let alone to all music in every movie or TV show. -7STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 18 of 36 Page ID #:346 1 “numerous DVDs” in which the content “including music lyrics, was not subtitled 2 or captioned.” Id. ¶¶ 1-9. These allegations suggest that reasonable consumers, 3 indeed even the named Plaintiffs, do not expect that all music and lyrics will be 4 captioned. Their prior experience of watching “numerous” movies or TV shows 5 would have demonstrated that such content is not always captioned. Accord Garcia 6 v. Sony Computer Entm’t Am., LLC, 859 F. Supp. 2d 1056, 1065 (N.D. Cal. 2012) 7 (dismissing misrepresentation claims when “[c]ommon experience suggests” 8 consumers believed “the contrary” to what plaintiff was alleging). 9 Further, in a prior settlement involving the Studios’ captioning of DVD bonus 10 materials, an overlapping class specifically acknowledged that song lyrics would not 11 be captioned in every instance. Request for Judicial Notice (“RJN”) Ex. A at 20, 12 § 2.3(A)(iii)(3)(ii) (Amended Agreement of Settlement, Compromise and Release, 13 Boltz v. Buena Vista Home Entm’t, Inc., No. BC 323842 (Cal. Super. Ct., L.A. Cty., 14 Apr. 20, 2006)); see also id. at 22, § 2.3(B)(iii)(2)(ii). The FCC also recognized in 15 2014 that there were no uniform standards for captioning quality, recognizing 16 instead that it is “inconsisten[t].” Closed Captioning of Video Programming; 17 Telecommunications for the Deaf and Hard of Hearing; Petition for Rulemaking, 79 18 Fed. Reg. 17,911, 17,912 (Mar. 31, 2014) (noting “inconsistencies in the quality of 19 closed captioning throughout the industry…”). The FCC went on to set quality 20 standards for captions for television programs exhibited for the first time on 21 broadcast television, see 47 C.F.R. § 79.1 – but these rules do not apply throughout 22 Plaintiffs’ challenged distribution channels. That the quality of captions on movies 23 or TV shows outside of the FCC’s rulemaking remain “inconsisten[t]” further shows 24 that reasonable consumers could not have a particular expectation about the 25 completeness of captions provided by theaters, streaming services, or on DVDs. 26 27 2. Plaintiffs Do Not Adequately Allege Reliance The misrepresentation claims also must be dismissed because Plaintiffs do not 28 adequately allege reliance, an essential element of each claim. See In re Tobacco II -8STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 19 of 36 Page ID #:347 1 Cases, 46 Cal. 4th 298, 326 (2009) (actual reliance required for UCL claim); In re 2 Toyota Motor Corp., 790 F. Supp. 2d 1152, 1168 (C.D. Cal. 2011) (same for FAL); 3 Marolda v. Symantec Corp., 672 F. Supp. 2d 992, 1003 (N.D. Cal. 2009) (same for 4 CLRA). “‘[T]he same level of specificity . . . with respect to [pleading] reliance’” is 5 required as “with respect to misrepresentations.” Marolda, 672 F. Supp. 2d at 1001 6 (internal quotation omitted); MacRae v. HCR Manor Care Servs., No. 14-cv-07157 DOC, 2014 WL 3605893, at *3-4 (C.D. Cal. July 21, 2014). 8 When pleading reliance, plaintiffs must allege that they were “motivated to 9 act or refrain from action based on the truth or falsity of a defendant’s statement, not 10 merely on the fact it was made.” Kwikset Corp. v. Super. Ct., 51 Cal. 4th 310, 327 11 n.10 (2011). Plaintiffs satisfy this requirement by alleging that, in absence of a 12 misrepresentation, they “‘in all reasonable probability’ would not have engaged in 13 the injury-producing conduct.” Morgan v. Wallaby Yogurt Co., Inc., No. 13-cv14 00296-WHO, 2014 WL 1017879, at *4 (N.D. Cal. Mar. 13, 2014) (quoting In re 15 Tobacco II Cases, 46 Cal. 4th at 326). Under Rule 9(b), it is not enough to make 16 “generalized claims of reliance” without “indicat[ing] what particular statements (in 17 advertisements or otherwise)” were relied on in making a purchase. In re 5-hour 18 ENERGY Mktg. and Sales Practices Litig., No. MDL 13–2438 PSG, 2014 WL 19 5311272, at *16-17 (C.D. Cal. Sept. 4, 2014). 20 Here, Plaintiffs have failed to allege that when making purchases, they relied 21 on an understanding that these terms like “captioned and subtitled” meant that all 22 song lyrics and music would be captioned. Instead, Plaintiffs allege generally that 23 they “reasonably relied on [defendants’] advertisements in determining whether or 24 not to purchase or rent the movie or show. Plaintiffs rely on captioning or subtitling 25 to watch and enjoy the movie or show.” Compl. ¶ 78. Alleging that Plaintiffs “rely 26 on captioning or subtitling to watch” a movie is not the same as alleging that 27 Plaintiffs relied to their detriment on a particular misrepresentation (e.g., that 28 “captioned” or “subtitled” did not include songs). Plaintiffs have thus failed to -9STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 20 of 36 Page ID #:348 1 allege that any misrepresentation was an “immediate cause” of their purchasing 2 decisions. In re Tobacco II Cases, 46 Cal. 4th at 326. 3 Moreover, even accepting that Plaintiffs theoretically could have based 4 purchasing decisions on an understanding that the terms “captioned” or “subtitled” 5 meant that song lyrics and music would always be fully captioned, that only covers 6 the first purchase by each Plaintiff. Plaintiffs have nowhere explained—let alone 7 alleged with sufficient specificity to adequately inform the Studios, see Marolda, 8 672 F. Supp. 2d at 1001—how they were “motivated to act … based on the truth or 9 falsity of a defendant’s statement” when purchasing multiple movies or TV shows. 10 Kwikset, 51 Cal. 4th at 327 n.10. Plaintiffs cannot plausibly claim to have relied on 11 any alleged misrepresentation more than once, since experience would have 12 demonstrated that song lyrics are not always captioned. Plaintiffs’ allegations of 13 “numerous” prior purchases demonstrate that there is no “reasonable probability,” 14 see In re Tobacco II Cases, 46 Cal. 4th at 326, that Plaintiffs would have refrained 15 from even their first purchase had the alleged misrepresentations not been made. 16 17 3. Plaintiffs’ Claims Do Not Satisfy Rule 9(b) Plaintiffs’ misrepresentation claims are “grounded in fraud,” and thus subject 18 to Rule 9(b), because they are based on allegations that the Studios induced 19 purchases by misrepresenting the degree to which their content was captioned. See 20 Cullen, 880 F. Supp. 2d at 1025. The Ninth Circuit has held that UCL, CLRA, and 21 FAL claims are grounded in fraud when plaintiffs allege: “(a) misrepresentation…; 22 (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; 23 (d) justifiable reliance; and (e) resulting damage.” Kearns v. Ford Motor Co., 567 24 F.3d 1120, 1126-27 (9th Cir. 2009) (internal quotation omitted). Plaintiffs allege a 25 course of conduct involving all of these elements. See Compl. ¶ 47 (UCL cause of 26 action alleging a “practice of utilizing representations that the content is captioned 27 or subtitled to sell or rent movies and shows”); id. ¶ 66 (CLRA cause of action 28 alleging that defendants “committed unfair and deceptive acts resulting in the sale or -10STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 21 of 36 Page ID #:349 1 rent of movies or shows”); id. ¶ 75 (FAL includes element that the defendant 2 “induce the public to enter into” a transaction with “untrue or misleading 3 statements”); id. ¶¶ 77-78 (alleging scienter and reasonable reliance). Plaintiffs also 4 seek an order “finding and declaring that the acts and practices of Defendants named 5 herein are unlawful, unfair, and fraudulent.” Prayer For Relief ¶ 2. The Complaint 6 contains allegations that “necessarily constitute fraud” and also uses the word 7 “fraud” to describe the Studios’ conduct. Vess, 317 F.3d at 1105. 8 Moreover, because Plaintiffs allege a “unified course of fraudulent conduct,” 9 the Complaint “as a whole must satisfy the particularity requirement of Rule 9(b).” 10 Kearns, 567 F.3d at 1127 (quoting Vess, 317 F.3d at 1103-04) (emphasis in 11 original). This means that Plaintiffs’ UCL claim must satisfy Rule 9(b) even to the 12 extent it is premised on the UCL’s “unlawful” and “unfair” prongs (not just the 13 “fraudulent” prong). Id. Plaintiffs do not allege that any separate acts by the 14 Studios violated the “unlawful” and “unfair” prongs of the UCL; rather, Plaintiffs 15 allege one “course of fraudulent conduct” that violates all prongs of the UCL (as 16 well as the FAL and CLRA). See Compl. ¶¶ 44-50, 65-67, 74-78. 17 A complaint alleging a course of conduct involving fraudulent 18 representations, but which fails to plead “the particular circumstances surrounding 19 such representations,” must be dismissed under Rule 9(b). Kearns, 567 F.3d at 20 1125-27; see also In re 5-hour ENERGY, 2014 WL 5311272, at *16-17. Without a 21 statement of the “who, what, when, where, and how of the misconduct,” Kearns, 22 567 F.3d at 1126, the Studios cannot develop defenses, including that they did not 23 actually make the statements in question, or that the statements were true or not 24 misleading. See Bly-Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001). 25 Here, Plaintiffs vaguely allege that the Studios made “misleading statements” 26 by distributing content “marked with and advertised as having captions or subtitles,” 27 e.g., Compl. ¶¶ 28, 67, but they fail to specify “‘the who, what, when, where, and 28 how’ of the misconduct charged.” Vess, 317 F.3d at 1105-06. For instance, -11STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 22 of 36 Page ID #:350 1 Plaintiffs fail to allege what specific statements representing that songs were 2 captioned were made by which Studios (“who”). Plaintiffs’ allegations about movie 3 theaters and streaming services are particularly deficient because it is not at all clear 4 that the Studios themselves made any representations about the captions or subtitles 5 provided through these services. Plaintiffs further fail to allege where and when 6 misstatements were displayed. For example, some plaintiffs allege they saw movies 7 in theaters (Compl. ¶¶ 1-3, 7, 9) without identifying the theater name or location, or 8 the physical location of the alleged misrepresentations. Other plaintiffs allege they 9 viewed movies “through a streaming service” or “Video on Demand” without 10 identifying the service, when they viewed the content at issue, or where a 11 misrepresentation was displayed. Compl. ¶¶ 3, 4, 8. No Plaintiff states where or 12 when he or she purchased a DVD containing an alleged misrepresentation. See 13 Compl. ¶¶ 1-9. Finally, Plaintiffs fail to allege how any representation misled them 14 into believing that songs were fully captioned. See Decker v. GlenFed, Inc. (In re 15 GlenFed, Inc. Sec. Litig.), 42 F.3d 1541, 1548 (9th Cir. 1994) (en banc), superseded 16 on other grounds as stated in SEC v. Todd, 642 F.3d 1207, 1216 (9th Cir. 2011). 17 Plaintiffs’ sparse pleadings fail to satisfy Rule 9(b)’s requirement that fraud be pled 18 with sufficient particularity to allow the Studios to develop defenses. 19 20 4. Plaintiffs Do Not Plead “Unfair” or “Unlawful” Conduct Plaintiffs allege a “unified course of fraudulent conduct” involving 21 misrepresentations about captions or subtitles. Kearns, 567 F.3d at 1127. This 22 means that Plaintiffs’ claims that the Studios have violated the “unlawful” and 23 “unfair” prongs of the UCL are subject to dismissal for the same reasons that their 24 “fraudulent” prong claims are. See id. But even considered separately, Plaintiffs 25 fail to state a claim under either additional UCL prong. 26 First, Plaintiffs fail to adequately allege “unlawful” conduct under the UCL 27 because, for the reasons set forth throughout this Memorandum, they have failed to 28 state a claim that the Studios violated any law. See Warner v. Tinder Inc., 105 F. -12STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 23 of 36 Page ID #:351 1 Supp. 3d 1083, 1095 (C.D. Cal. 2015). 2 Second, Plaintiffs fail to state a claim that the Studios have engaged in 3 “unfair” conduct, because the Complaint relies on boilerplate language that the 4 Studios’ conduct “offends public policy,” “is substantially injurious to consumers” 5 and is “unethical,” Compl. ¶ 47, but fails to allege that this conduct violates a public 6 policy embodied in “any specific constitutional, statutory or regulatory provision.” 7 Boris v. Wal-Mart Stores, Inc., 35 F. Supp. 3d 1163, 1171-72 (C.D. Cal. 2014). 8 Plaintiffs have also failed to state a claim under the competing test that requires 9 alleging a harm to consumers that is not outweighed by the utility of the Studios’ 10 conduct. See Peterson v. Mazda Motor of Am., Inc., 44 F. Supp. 3d 965, 972 (C.D. 11 Cal. 2014). Plaintiffs allege conclusorily that the Studios’ conduct has “no utility,” 12 Compl. ¶ 47, but it is apparent from the Complaint that the Studios’ voluntary 13 provision of captions and subtitles for the dialogue of movies and TV shows, as well 14 as for some song lyrics and music, has utility. Compl. ¶ 36. Plaintiffs have alleged 15 no facts plausibly suggesting they have suffered harm from receiving allegedly 16 incomplete captions that outweighs the utility of the Studios’ providing the level of 17 captions they believe is appropriate. See Cullen, 880 F. Supp. 2d at 1029 18 (dismissing “unfair” prong claim where plaintiff did not allege “facts about any 19 potential utility of” challenged conduct). 20 21 22 B. Plaintiffs’ Warranty Claims Should Be Dismissed 1. Plaintiffs Do Not Allege a “Sale” of “Consumer Goods” The implied warranties Plaintiffs assert apply to “sale[s] of consumer goods” 23 “at retail in this state.” Cal. Civ. Code §§ 1792, 1792.1. A sale is “[t]he passing of 24 title from the seller to the buyer for a price.” Id. § 1791(n). In the Complaint, no 25 “sales” of video content plausibly can be alleged for purchases of DVDs, digital 26 streaming services, or movie tickets. Movie theaters do not sell movies as goods; 27 they “provide the service of screening first run movies.” Ball v. AMC Entm’t, Inc., 28 246 F. Supp. 2d 17, 24 (D.D.C. 2003); accord Advocates, 113 Cal. App. 4th at -13STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 24 of 36 Page ID #:352 1 1358-59 (affirming dismissal of warranty claims against satellite broadcaster 2 because broadcaster provided “a ‘service’ and not ‘goods’”). In the case of DVDs 3 and streaming, title to video content remains with the copyright owner, and 4 purchasers take title only to the physical DVD, a license to view content on a 5 streaming service, or, in some instances where a digital copy of a movie is being 6 purchased, a media file. But they do not take title to copyrighted video content 7 itself. See 17 U.S.C. § 202 (“Transfer of ownership of any material object” in which 8 a copyrighted work is embodied “does not of itself convey any rights in the 9 copyrighted work embodied in the object….”). Though the specific licenses 10 Plaintiffs received to view content on a purchased DVD or streaming service may 11 differ across the challenged distribution channels (and between the different 12 Studios), in all cases, Plaintiffs have failed to allege any facts plausibly suggesting 13 that they purchased title to content rather than a license.3 14 Even assuming that Plaintiffs did purchase title to video content (despite the 15 lack of any facts establishing a sale), such content is not a “consumer good” subject 16 to implied warranty law. See Atkinson v. Elk Corp., 109 Cal. App. 4th 739, 754-58 17 (2003) (roof shingles are not consumer goods because consumer goods can be 18 moved, serviced or repaired). The content of a movie or TV show cannot be moved, 19 serviced or repaired, and it cannot sensibly be categorized as a “consumer good” 20 along with things like washing machines and computers. See id.; cf. Tietsworth v. 21 Sears, 720 F. Supp. 2d 1123, 1127-28 (N.D. Cal. 2010); Anunziato v. eMachines, 22 Inc., 402 F. Supp. 2d 1133, 1135-36 (C.D. Cal. 2005). Courts commonly 23 distinguish between the expressive content of movies or other intellectual property, 24 25 3 Accord United States v. Wise, 550 F.2d 1180, 1188-89 (9th Cir. 1977) 26 (“[c]opyright proprietors frequently transfer rights in their works by complicated agreements which cannot simply be called ‘sales’”; “[i]n each case, the court must 27 analyze the arrangement at issue and decide whether it should be considered” a sale 28 (under the first sale doctrine) (internal citation omitted)). -14STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 25 of 36 Page ID #:353 1 and the medium conveying that content, and hold that only the latter is the proper 2 subject of products liability law. See, e.g., Winter v. G. P. Putnam’s Sons, 938 F.2d 3 1033, 1034 (9th Cir. 1991); Wilson v. Midway Games, Inc., 198 F. Supp. 2d 167, 4 174 (D. Conn. 2002) (collecting cases).4 2. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Plaintiffs Do Not Allege Facts Showing That the Challenged Movies and TV Shows Are Unmerchantable Plaintiffs also fail to state a claim for breach of the implied warranty of merchantability because they fail to allege that the movies or TV shows cited in the Complaint are so defective that they lack “even the most basic degree of fitness for ordinary use.” Mocek v. Alfa Leisure, Inc., 114 Cal. App. 4th 402, 406 (2003) (internal quotation omitted); see also Cal. Civ. Code § 1791.1(a)(2). Courts have dismissed implied warranty of merchantability claims where plaintiffs alleged that a defect is “inconvenient,” but not that the product lacked a “basic degree of fitness” or fell below a “minimum level of quality.” E.g., In re iPhone 4S Consumer Litig., No. 12-cv-1127-CW, 2013 WL 3829653, at *16 (N.D. Cal. July 23, 2013); see also Viggiano v. Hansen Natural Corp., 944 F. Supp. 2d 877, 896 (C.D. Cal. 2013) (no breach of implied warranty where artificial ingredients present in soda labeled as “all natural” when there was no allegation that “beverage was not drinkable, that it was contaminated or contained foreign objects, etc.”); accord Tae Hee Lee v. Toyota Motor Sales, U.S.A., Inc., 992 F. Supp. 2d 962, 979 (C.D. Cal. 2014). Failing to caption some song lyrics does not render a movie or television show so incomprehensible that it lacks the most “basic degree of fitness” for the ordinary purpose of providing entertainment. A movie is still merchantable if the dialogue is captioned but some (or even all) song lyrics are not. This is evidenced by the fact that the Plaintiffs kept purchasing movies and TV shows even after learning that the practice of not captioning lyrics was “frustratingly widespread.” 27 4 28 See Studios’ Special Mot. to Strike at 22-23. -15STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 26 of 36 Page ID #:354 1 E.g., Avedisian v. Mercedes-Benz USA, LLC, 43 F. Supp. 3d 1071, 1079 (C.D. Cal. 2 2014) (fact that plaintiff used her car for years “despite the presence of the defect” 3 showed defect did not “drastically undermine[]” vehicle’s “ordinary operation”). 4 3. 5 6 Plaintiffs Do Not Allege Facts Showing a “Particular Purpose” Requiring That All Song Lyrics Be Captioned or Subtitled or That the Studios Knew of Any Such Purpose To state a claim for breach of the implied warranty of fitness, Plaintiffs must 7 allege facts showing that the Studios had “reason to know at the time of retail sale” 8 that Plaintiffs were purchasing movies or TV shows for a “particular purpose” and 9 were “relying on [the Studios’] skill or judgment to select or furnish suitable goods.” 10 Cal. Civ. Code § 1792.1. The “particular purpose” Plaintiffs appear to allege is 11 obtaining “subtitles that would meet the particular needs of the deaf and hard of 12 hearing community.” Compl. ¶ 54. But Plaintiffs nowhere allege that the Studios 13 had “reason to know” what those “particular needs” were, or that they included 14 captioning song lyrics. See In re Sony PS3 Other OS Litig., 551 F. App’x 916, 920 15 (9th Cir. 2014) (affirming dismissal where “Plaintiffs fail to allege that Sony ‘ha[d] 16 reason to know’ that Plaintiffs purchased the PS3 for any ‘particular purpose’”). 17 Indeed, the Studios had good reason to conclude their subtitles do meet the needs of 18 the deaf and hard of hearing community, because they previously reached a 19 settlement over captioning that did not require them to provide captions for all song 20 lyrics. See RJN Ex. A at 20, 22; supra at 8. 21 To the extent Plaintiffs’ implied warranty claim is based on alleged 22 misrepresentations regarding the nature of the subtitles, it fails. “[I]njuries 23 attributable to the marketing efforts by the seller” rather than the nature of the 24 product itself cannot be the basis for a breach of the implied warranty of fitness. See 25 Martinez v. Metabolife Int’l, Inc., 113 Cal. App. 4th 181, 189 (2003). 26 27 4. Plaintiffs Do Not Allege Any Purchases in California Finally, “[t]he Song-Beverly Act only governs goods sold at retail in 28 California.” Anunziato v. eMachines, Inc., 402 F. Supp. 2d 1133, 1142 (C.D. Cal. -16STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 27 of 36 Page ID #:355 1 2005); see also Keegan v. Am. Honda Motor Co., 838 F. Supp. 2d 929, 945 n.51 2 (C.D. Cal. 2012). Plaintiffs’ warranty claims must thus be dismissed because no 3 Plaintiff alleges that he or she made a purchase in California.5 This also necessitates 4 dismissal of the class claims for breach of implied warranty because the class 5 definition is not restricted to California purchases. See In re NVIDIA GPU Litig., 6 No. 08-cv-04312-JW, 2009 WL 4020104, at *5 (N.D. Cal. Nov. 19, 2009). C. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Plaintiffs’ Unruh Act Claim Should Be Dismissed Because They Do Not Allege Intentional Discrimination To establish an Unruh Act violation independent of a claim under the ADA (as Plaintiffs purport to do here), a plaintiff “must plead and prove intentional discrimination in public accommodations in violation of the terms of the Act.” Greater L.A. Agency on Deafness, 742 F.3d at 425 (internal quotation marks omitted). The California Supreme Court has held that plaintiffs must plead and prove “willful, affirmative misconduct.” Koebke, 115 P.3d at 1228 (internal quotation marks omitted). Plaintiffs “must allege more than the disparate impact of a facially neutral policy on a particular group” to state a claim for intentional discrimination. Cullen, 880 F. Supp. at 1024 (internal citation omitted). Plaintiffs’ Unruh Act claim should be dismissed because they fail to (and cannot) allege intentional discrimination. Instead, the Complaint alleges conclusorily that “Plaintiffs and class members have not been provided services that are provided to other patrons who are not disabled, or deaf and hard of hearing, and have been provided services that are inferior to the services provided to nondisabled patrons.” Compl. ¶ 71. But precisely the same captions or subtitles are available to all viewers, whether they are hearing-impaired or not. Cf. Greater L.A. Agency on Deafness, 742 F.3d at 426 (reaching same conclusion). 5 The Complaint also alleges no facts allowing for the plausible inference that 27 videos viewed in a theater or through a subscription streaming service are “goods 28 that are sold at retail in” California. See Cal. Civ. Code § 1792. -17STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 28 of 36 Page ID #:356 1 Plaintiffs may argue that hearing-impaired viewers are more likely to be 2 affected by the alleged captioning deficiencies. But this is a “disparate impact” 3 argument that cannot be the basis for an Unruh Act claim. See id. at 426-27; Cullen, 4 880 F. Supp. 2d at 1024-25 (allegations that Netflix failed to caption streaming 5 video described “a policy with a disparate impact on hearing-impaired individuals,” 6 not “willful, affirmative misconduct”); Belton v. Comcast Cable Holdings, LLC, 151 7 Cal. App. 4th 1224 (2007) (allegation that cable company’s bundling practices 8 disparately impacted blind persons failed, “as a matter of law, to state a violation of 9 the Unruh Act”); see generally Cal. Civ. Code § 51(c) (exempting from Unruh Act 10 standards that apply to all persons). 11 As in Greater L.A. Agency on Deafness and Cullen, the Studios’ alleged 12 failure to caption music and song lyrics is a neutral policy applicable to all persons 13 viewing the Studios’ content. The Studios grant persons who are deaf or hard of 14 hearing the same access to movies and TV shows as the rest of the public, and thus 15 do not discriminate. Furthermore, Plaintiffs claim that the Studios justify captioning 16 decisions based on “lack of necessary copyrights.” Compl. ¶ 43. Even if, as 17 Plaintiffs allege, this is a misplaced concern because the Studios could violate 18 copyright and then claim fair use, complying with copyright law does not evidence 19 animus toward deaf or hard of hearing persons, or “arbitrary” discrimination of the 20 kind the Unruh Act prohibits. See Kotev v. First Colony Life Ins. Co., 927 F. Supp. 21 1316, 1320 (C.D. Cal. 1996); see also Dallas & Lashmi, Inc. v. 7-Eleven, Inc., No. 22 15-cv-02044-SJO, 2015 WL 3631684, at *10 (C.D. Cal. June 10, 2015) (“The bare 23 possibility of discrimination premised on speculation, without any underlying 24 factual basis, is insufficient to state a claim under the Unruh Act.”). 25 Furthermore, as with the implied warranty claims, the Unruh Act claim must 26 be dismissed for the independent reason that the Complaint fails to allege any 27 “discrimination that takes place within California’s borders.” Warner, 105 F. Supp. 28 3d at 1099. The Unruh Act does not have extraterritorial reach. See id. -18STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 29 of 36 Page ID #:357 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D. Plaintiffs’ Complaint Suffers From Numerous Other Deficiencies 1. Plaintiffs Lack Standing to Bring Misrepresentation Claims Based on Movies or TV Shows They Did Not Purchase The Complaint’s class definition purports to include any movie or show where a Plaintiff had “the expectation” that the movie or show would be fully captioned, but it contained “features that were not subtitled.” Compl. ¶¶ 24, 25. This could include any number of unnamed movies or shows distributed by the Studios. Id. ¶ 36 (providing a non-exhaustive list of 22 movies or shows). In light of this definition, the class claims must be dismissed in part or struck, because Plaintiffs lack statutory and Article III standing to bring UCL, FAL, or CLRA claims as to movies or shows they did not purchase. As one court has explained: A plaintiff has standing to assert injury based on a defective product or false advertising only if the plaintiff experienced injury stemming from the purchase of that product.… Accordingly, when a plaintiff asserts claims based both on products that she purchased and products that she did not purchase, claims relating to products not purchased must be dismissed for lack of standing. Granfield v. NVIDIA Corp., No. 11-cv-05403-JW, 2012 WL 2847575, at *6 (N.D. Cal. July 11, 2012). A number of district courts have dismissed UCL, CLRA, and FAL claims pertaining to products not purchased by a named plaintiff for lack of standing. E.g., id.; Hairston v. S. Beach Beverage Co., No. 12-cv-1429-JFW, 2012 WL 1893818, at *5 n.5 (C.D. Cal. May 18, 2012); Mlejnecky v. Olympus Imaging Am. Inc., No. 10-cv-02630-JAM, 2011 WL 1497096, at *4 (E.D. Cal. Apr. 19, 2011); Johns v. Bayer Corp., No. 09-cv-1935-DMS, 2010 WL 476688, at *4-5 (S.D. Cal. Feb. 9, 2010). Other courts do not categorically dismiss “unpurchased products” claims, but will dismiss them unless plaintiffs specifically allege that the purchased and unpurchased products, and accompanying misrepresentations, are “substantially similar.” E.g., Route v. Mead Johnson Nutrition Co., No. 12-cv7350-GW, 2013 WL 658251, at *3-4 & n.4 (C.D. Cal. Feb. 21, 2013); Miller v. -19STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 30 of 36 Page ID #:358 1 Ghirardelli Chocolate Co., 912 F. Supp. 2d 861, 869 (N.D. Cal. 2012) (collecting 2 cases); cf. Grodzitsky v. Am. Honda Motor Co., No. 12-cv-1142-SVW, 2013 WL 3 2631326, at *4 (C.D. Cal. June 12, 2013) (Wilson, J.) (deferring until class 4 certification the question whether plaintiffs could represent class members as to cars 5 they did not purchase but “that contained the same defect”) (emphasis added). 6 The Studios submit that the former line of cases correctly applies standing 7 doctrines in the context of misrepresentation claims, and is consistent with the state 8 Supreme Court’s guidance in Kwikset, 51 Cal. 4th at 322, 323-34. See Mlejnecky, 9 2011 WL 1497096, at *4. Under this line of cases, the Court should dismiss from 10 the Complaint all UCL, FAL, and CLRA claims pertaining to movies or TV shows 11 not purchased by the named Plaintiffs, or strike such claims from the class 12 definition. Nonetheless, even under the second line of cases, these claims should 13 still be dismissed. That is because Plaintiffs fail to allege that all the movies or TV 14 shows included in the class definition are “substantially similar” to those they 15 actually purchased, and contained similar misrepresentations. Without such 16 allegations, Plaintiffs lack standing to pursue claims over products they did not buy. 17 See, e.g., Kane v. Chobani, Inc., No. 12–cv–02425–LHK, 2013 WL 5289253, at *11 18 (N.D. Cal. Sept. 19, 2013). Put differently, Plaintiffs have not adequately alleged 19 that their interests are “similar” to those of the unnamed plaintiffs such that they 20 would have standing to “present claims on behalf of others who have similar, but 21 not identical, interests.” Grodzitsky, 2013 WL 2631326 at *4 (quoting Bruno v. 22 Quten Res. Inst., LLC., 280 F.R.D. 524, 530 (C.D. Cal. 2011)). 23 24 25 2. Under Choice-of-Law Principles, Plaintiffs’ Individual UCL, CLRA and FAL Claims Should Be Dismissed, and the Class Claims Should Be Limited to California Purchases Plaintiffs’ individual UCL, FAL, and CLRA claims are premised on 26 purchases allegedly induced by the Studios’ misrepresentations, but the Complaint 27 fails to allege where each Plaintiff made his or her purchases. In addition to 28 flunking Rule 9(b)’s particularity requirement, this deficiency puts the Studios in the -20STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 31 of 36 Page ID #:359 1 unfair position of being unable to assess whether Plaintiffs’ UCL, FAL, and CLRA 2 causes of action can apply extraterritorially. As one court has noted, “obfuscating 3 the state” of a plaintiff’s purchase wrongfully “preclude[s]” defendant from showing 4 that California law should not be applied to out-of-state transactions. Frenzel v. 5 AliphCom, 76 F. Supp. 3d 999, 1008-09 (N.D. Cal. 2014) (dismissing individual 6 CLRA, UCL, and FAL claims on this basis). It is likely that many or all named 7 Plaintiffs did not make any purchases in California, since seven of them live in or 8 are “from” other states, while only two are alleged to be “from” California (but there 9 is no allegation that they currently live there). See Compl. ¶¶ 1-9.6 10 Plaintiffs also purport to bring UCL, FAL, and CLRA claims on behalf of a 11 nationwide class, which will include persons who made purchases outside of 12 California. But “California law may only be used on a class wide basis if ‘the 13 interests of other states are not found to outweigh California’s interest in having its 14 law applied.’” Mazza v. Am. Honda Motor Co., Inc., 666 F.3d 581, 590 (9th Cir. 15 2012) (internal citation omitted). Courts perform a three-step test to decide if other 16 states’ interests in applying their laws outweigh California’s interest: 17 First, the court determines whether the relevant law of each of the potentially affected jurisdictions with regard to the particular issue in question is the same or different. 18 19 20 Second, if there is a difference, the court examines each jurisdiction’s interest in the application of its own law under the circumstances of the particular case to determine whether a true conflict exists. 21 22 23 Third, if the court finds that there is a true conflict, it carefully evaluates and compares the nature and strength of the interest of each jurisdiction in the application of its 24 25 26 6 A separate deficiency applicable only to the CLRA claim is that Plaintiffs have 27 failed to file an affidavit of proper venue as required under the CLRA. Cal. Civ. 28 Code § 1780(d). This alone necessitates dismissal of the CLRA claim. Id. -21STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 32 of 36 Page ID #:360 1 2 3 4 own law to determine which state’s interest would be more impaired if its policy were subordinated to the policy of the other state, and then ultimately applies the law of the state whose interest would be more impaired if its law were not applied. 5 Id. (internal quotation marks omitted). In Mazza, the Ninth Circuit answered these 6 questions in defendant’s favor and concluded that a nationwide UCL, FAL, and 7 CLRA class could not be sustained. This was so even though the defendant was a 8 California corporation, see id. at 594, accused of disseminating misleading ads from 9 its California headquarters. Id. at 598 (D.W. Nelson, J., dissenting). For the 10 following reasons, the governmental interest test points the same way on the facts of 11 this case. It is appropriate to resolve this issue on the pleadings, because discovery 12 is not necessarily “required to confirm material differences” in state laws. See, e.g., 13 Frezza v. Google Inc., 12-cv-000237-RMW, 2013 WL 1736788, at *6-7 (N.D. Cal. 14 Apr. 23, 2013); Frenzel, 76 F. Supp. 3d at 1006-10 (collecting cases). 15 16 (i) Differences Between State Laws On the first question, state consumer protection laws vary widely in ways that 17 could be outcome-determinative for this case, and so present material conflicts. 18 Mazza, 666 F.3d at 590 (conflicts of law are material “if they make a difference in 19 the litigation”). The material differences in state laws include: Reliance. The UCL, FAL, and CLRA require that the named class plaintiffs 20 21 plead and prove reliance (see supra at 8-9), while other states allow recovery 22 without a showing of reliance. Mazza, 666 F.3d at 591; see also Fraser Eng’g Co. 23 v. Desmond, 524 N.E.2d 110, 113 (Mass. App. Ct. 1988) (Massachusetts law does 24 not require showing of reliance if there is a “causal relationship between the 25 misrepresentation and the injury”); Group Health Plan v. Phillip Morris, Inc., 621 26 N.W.2d 2, 12-13 & n.10 (Minn. 2001) (Minnesota’s misrepresentation laws do not 27 “require proof of individual reliance in all actions seeking damages”). Since the 28 Studios have disputed and will continue to dispute that Plaintiffs relied on any -22STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 33 of 36 Page ID #:361 1 purported misrepresentations, it is possible a different outcome would be reached if 2 Plaintiffs’ claims were brought in a forum like Massachusetts or Minnesota (where 3 three Plaintiffs are from, see Compl. ¶¶ 3-4, 8). 4 Proper plaintiffs. California permits UCL, FAL, and CLRA claims to be 5 brought by consumers in a class action, as do states like Michigan and Oregon with 6 similar claims, but other states’ consumer protection laws provide no private cause 7 of action for consumers. Compare Mich. Comp. Laws Ann. § 445.911 (2011), and 8 Or. Rev. Stat. Ann. § 646.638 (2011), with Molo Oil Co. v. River City Ford Truck 9 Sales, Inc., 578 N.W.2d 222, 228 (Iowa 1998). At least seven states prohibit class 10 adjudication of unfair trade practices claims, including Virginia, where one Plaintiff 11 is from. Compl. ¶ 6. See Ala. Code 1975 § 8-19-10(f) (2011); Ga. Code Ann. § 1012 1-399(a) (2011); La. Rev. Stat. Ann. § 51:1409(A) (2008); Miss. Code Ann. § 7513 24-15(4) (2010); S.C. Code Ann. § 35-5-140(a) (2010); Tenn. Code Ann. § 47-1814 109(g) (2013); Va. Code Ann. § 59.1-204 (2006). These differences are material 15 because under the state consumer protection laws that bar private or class actions, 16 Plaintiffs may not have been able to bring this representative action at all. 17 Test for likelihood of deception. As discussed, California’s UCL, FAL, and 18 CLRA require Plaintiffs to plead and prove that reasonable consumers were likely to 19 be deceived by a misrepresentation. See supra at 6. But other states measure the 20 deceptiveness of representations by its effect on least sophisticated or “ignorant” 21 consumers. See Aurigemma v. Arco Petrol. Prods., 734 F. Supp. 1025, 1029 (D. 22 Conn. 1990); RRTM Restaurant Corp. v. Keeping, 766 S.W.2d 804, 808 (Tex. App. 23 1988). These differences are material because the latter states (including Texas, 24 where one named Plaintiff is from, see Compl. ¶ 7), would not require Plaintiffs to 25 meet the comparatively higher burden of demonstrating that “reasonable” 26 consumers believed that all music and song lyrics would be captioned. 27 Remedies. State laws vary in terms of whether damages are recoverable and 28 how they are calculated. Damages are not recoverable under the UCL and FAL, and -23STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 34 of 36 Page ID #:362 1 the CLRA authorizes damages only if a pre-suit notice is filed. In re Sony Gaming 2 Networks & Customer Data Sec. Breach Litig., 903 F. Supp. 2d 942, 971 & n.27 3 (S.D. Cal. 2012). But other states allow recovery of damages, calculated according 4 to differing methodologies, and some allow punitive damages. Mass. Gen. Laws 5 Ch. 93A § 9 (authorizing damages multiplier for willful or knowing violations); 6 Mich. Comp. Laws Ann. § 445.911 § 11 (2015) (damages available in individual 7 actions; other relief, including damages, specified for class actions); Luskin’s Inc. v. 8 Consumer Prot. Div., 353 Md. 335, 386 (Md. 1999) (consumer protection statute 9 authorizes “unjust enrichment” remedy). These differences in remedies are material 10 because they affect what Plaintiffs bringing suit in other states—including 11 Massachusetts, Michigan, and Maryland, where four Plaintiffs are from (Compl. 12 ¶¶ 1-4)—could recover for the same allegations about captions and subtitles. 13 14 (ii) True Conflict On the second question, the above differences present true conflicts 15 implicating a core principle of federalism: each state’s right to “its own reasoned 16 judgment about what conduct is permitted or proscribed within its borders.” Mazza, 17 666 F.3d at 591. In some of the above examples, other states confer greater 18 protections on consumers than California does, such as by imposing no reliance 19 requirement or permitting recovery of damages. In other ways, California’s laws 20 may be more pro-consumer. As noted in Mazza, it is the right of state legislatures to 21 “balanc[e] the range of products and prices offered to consumers with the legal 22 protections afforded to them.” Id. at 592. Each state has an interest in seeing its 23 chosen legal protections applied to consumers, as well as seeing its “limitations on 24 liability” applied to businesses operating in its territory. Id. at 592-93. 25 26 (iii) Which State’s Interest Would Be More Impaired On the third question, other states’ interests would be more impaired by the 27 decision to apply California law to out-of-state transactions. As California 28 recognizes, the forum with the “predominant interest” in regulating misconduct is -24STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 35 of 36 Page ID #:363 1 the “place of the wrong.” As in Mazza, here, the “place of the wrong” is in the 2 states where putative class members viewed the Studios’ alleged misrepresentations 3 and made their purchases. 666 F.3d at 593. These states “have a strong interest in 4 the application of their laws to transactions between their citizens and corporations 5 doing business within their state.” Id. at 594. “Conversely, California’s interest in 6 applying its law to residents of foreign states is attenuated,” since it is not necessary 7 to apply California law to out-of-state transactions in order to achieve California’s 8 interest in protecting its citizens and regulating California corporations. Id. 9 As the above analysis suggests, this case closely tracks the facts of Mazza, 10 and should be decided the same way. See Grodzitsky v. Am. Honda Motor Co. Inc., 11 No. 2:12-CV-01142-SVW, 2014 WL 718431, at *9 (C.D. Cal. Feb. 19, 2014) 12 (Wilson, J.). The Court should hold that the class claims should be governed by the 13 consumer protection laws of the state where putative class members made their 14 purchases, and should dismiss the nationwide class claims. 15 16 3. Plaintiffs Lack Standing to Obtain Equitable Relief Finally, Plaintiffs’ claims for injunctive and declaratory relief must be 17 dismissed. Plaintiffs lack standing to pursue this relief because they are not 18 “realistically threatened by a repetition” of the alleged violation. Saavedra v. Eli 19 Lily & Co., No. 12-cv-9366-SVW, 2013 WL 6345442, at *8 (C.D. Cal. Feb. 26, 20 2013) (Wilson, J.) (quoting Gest v. Bradbury, 443 F.3d 1177, 1181 (9th Cir. 2006)). 21 According to the Complaint, Plaintiffs are now aware that movies and TV shows do 22 not always caption song lyrics or music, so there is no realistic chance that they will 23 continue to be harmed or deceived by the Studios’ alleged misconduct. See id. 24 V. CONCLUSION 25 For the above reasons, the Complaint should be dismissed in its entirety. 26 27 28 -25STUDIOS’ MOTION TO DISMISS THE COMPLAINT Case 2:15-cv-09593-SVW-JPR Document 19 Filed 01/20/16 Page 36 of 36 Page ID #:364 1 Respectfully submitted, 2 DATED: January 20, 2016 MUNGER, TOLLES & OLSON LLP 3 4 5 6 7 8 9 10 11 12 13 14 By: /s/ Glenn D. Pomerantz GLENN D. POMERANTZ Attorneys for Defendants BUENA VISTA HOME ENTERTAINMENT, INC.; THE WALT DISNEY COMPANY; WARNER BROS. ENTERTAINMENT INC.; WARNER BROS. HOME ENTERTAINMENT INC.; UNIVERSAL STUDIOS HOME ENTERTAINMENT LLC; PARAMOUNT PICTURES CORPORATION; SONY PICTURES ENTERTAINMENT INC.; SONY PICTURES HOME ENTERTAINMENT INC. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -26STUDIOS’ MOTION TO DISMISS THE COMPLAINT