Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 1 of 22 Page ID #:191 1 2 3 4 5 6 7 8 9 10 11 12 THEANE EVANGELIS, SBN 243570 tevangelis@gibsondunn.com TIMOTHY W. LOOSE, SBN 241037 tloose@gibsondunn.com JEREMY S. SMITH, SBN 283812 jssmith@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP 333 South Grand Avenue Los Angeles, CA 90071-3197 Telephone: 213.229.7000 Facsimile: 213.229.7520 MATTHEW BALL, SBN 327028 mnball@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP 1881 Page Mill Road Palo Alto, CA 94304-1211 Telephone: 650.849.5300 Facsimile: 650.849.5333 Attorneys for Draper James, LLC, and Reese Witherspoon UNITED STATES DISTRICT COURT 13 CENTRAL DISTRICT OF CALIFORNIA 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Gibson, Dunn & Crutcher LLP WESTERN DIVISION LARYSSA GALVEZ, JUDITH LINDLEY, and NATALIE ANDERSON, Plaintiffs, v. DRAPER JAMES, LLC, REESE WITHERSPOON, and DOES 1 THROUGH 10, Defendants. CASE NO. 2:20-cv-04976-FMO-SK DEFENDANTS DRAPER JAMES, LLC’S AND REESE WITHERSPOON’S NOTICE OF MOTION AND MOTION TO DISMISS PLAINTIFFS’ COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO DISMISS Hearing: Date: Time: Courtroom: Judge: August 13, 2020 10:00 a.m. 6D, 6th Floor Hon. Fernando M. Olguin Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 2 of 22 Page ID #:192 1 2 3 NOTICE OF MOTION AND MOTION TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on August 13, 2020, at 10:00 a.m., or as soon 4 thereafter as may be heard by the Honorable Fernando M. Olguin, in Courtroom 6D of 5 this Court, Defendants Draper James, LLC (“Draper James”) and Reese Witherspoon 6 will and hereby do move the Court to dismiss with prejudice claims asserted by 7 Plaintiffs Laryssa Galvez, Judith Lindley, and Natalie Anderson (“Plaintiffs”) in the 8 above-captioned action under Federal Rule of Civil Procedure 12(b)(6). 9 Plaintiffs’ lawsuit seeks to punish Defendants for a goodwill offer of a limited 10 number of free dresses to teachers, in recognition of their efforts to continue educating 11 children during the COVID-19 pandemic. But as a matter of law, Plaintiffs cannot 12 turn Defendants’ desire to acknowledge teachers into a lawsuit for several reasons: 13 (1) all claims fail because they lack allegations of both causation and any injury; 14 (2) the breach-of-contract claims rely on a gross mischaracterization of the promotion; 15 (3) the claims of unjust enrichment, violations of the California Legal Remedies Act, 16 and violations of the California Business and Professions Code § 17200 all fail to 17 establish the lack of an adequate remedy at law; (4) Plaintiffs fail to establish that they 18 are “consumers” under the California Legal Remedies Act or allege that any reliance 19 or misrepresentation occurred; and (5) Plaintiffs fail to establish any unfair, unlawful, 20 or fraudulent conduct under California Business and Professions Code § 17200. 21 Defendants’ Motion to Dismiss is based on this Notice of Motion and 22 Memorandum of Points and Authorities submitted herewith, Plaintiffs’ Complaint, and 23 other such matters that the Court may consider. 24 25 This Motion is made following the conference of counsel pursuant to Local Rule 7-3, which took place on June 24, 2020. 26 27 28 Gibson, Dunn & Crutcher LLP 2 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 3 of 22 Page ID #:193 1 2 3 RELIEF SOUGHT Defendants seek an order dismissing the entirety of Plaintiffs’ Complaint with prejudice. 4 5 DATED: July 10, 2020 GIBSON, DUNN & CRUTCHER LLP 6 7 /s/ Theane Evangelis Theane Evangelis By: 8 9 10 Attorneys for DEFENDANTS DRAPER JAMES, LLC, AND REESE WITHERSPOON 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Gibson, Dunn & Crutcher LLP 3 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 4 of 22 Page ID #:194 1 TABLE OF CONTENTS 2 I. INTRODUCTION ....................................................................................................... 9 3 II. FACTUAL BACKGROUND .................................................................................. 10 4 III. LEGAL STANDARD............................................................................................. 12 5 IV. ARGUMENT .......................................................................................................... 13 6 A. All of Plaintiffs’ Claims Fail Because Plaintiffs Do Not Allege They Entered into the Giveaway, Much Less Allege that Defendants Caused Them Harm. ............................................................. 13 B. The Claims Sounding in Contract Also Fail Because Plaintiffs Do Not Allege They Entered Into an Agreement Nor That It Was Breached. .................................................................................................. 15 C. The Equitable Claims Also Fail Because There Is an Adequate Remedy at Law......................................................................................... 17 D. The CLRA Claim Has Other, Additional Flaws that Require Dismissal. ................................................................................................. 18 E. Plaintiffs’ UCL Claim Also Fails Because the Promotion Was As Advertised. ............................................................................................... 20 7 8 9 10 11 12 13 14 15 V. CONCLUSION ........................................................................................................ 21 16 17 18 19 20 21 22 23 24 25 26 27 28 Gibson, Dunn & Crutcher LLP 4 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 5 of 22 Page ID #:195 1 TABLE OF AUTHORITIES 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 Page(s) Cases Ashcroft v. Iqbal, 556 U.S. 662 (2009)............................................................................................ 12, 13 Bardin v. DaimlerChrysler Corp., 136 Cal. App. 4th 1255 (2006) ................................................................................. 21 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)............................................................................................ 12. 13 Brown v. Superior Court, 199 Cal. App. 4th 971 (2011) ................................................................................... 15 Capaci v. Sports Research Corp., No. CV193440FMOFFMX, 2020 WL 1482313 (C.D. Cal. Mar. 26, 2020) ......................................................................................................................... 12 Casillas v. Northgate Gonzalez Markets, Inc., No. SACV1600064CJCKESX, 2016 WL 10966424 (C.D. Cal. May 11, 2016) ................................................................................................................... 19 Chansue Kang v. P.F. Chang’s China Bistro, Inc., No. CV 19-02252 PA (SPX), 2020 WL 2027596 (C.D. Cal. Jan. 9, 2020) ......................................................................................................................... 15 Claridge v. RockYou, Inc., 785 F. Supp. 2d 855 (N.D. Cal. 2011) ...................................................................... 19 Daugherty v. Am. Honda Motor Co., Inc., 144 Cal. App. 4th 824 (2006) ................................................................................... 20 Ebner v. Fresh, Inc., 838 F.3d 958 (9th Cir. 2016) .................................................................................... 20 In re Facebook Privacy Litig., 791 F. Supp. 2d 705 (N.D. Cal. 2011) ...................................................................... 14 Freeman v. Time, Inc., 68 F.3d 285 (9th Cir. 1995) ...................................................................................... 17 28 Gibson, Dunn & Crutcher LLP 5 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 6 of 22 Page ID #:196 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Gomez v. Jelly Belly Candy Co., No. 17-CV-0575, 2017 WL 8941167 (C.D. Cal. Aug. 18, 2017) ............................ 18 Griffith Co. v. Hofues, 201 Cal. App. 2d 502 (1962) .................................................................................... 14 Haley v. Casa Del Rey Homeowners Assn., 153 Cal. App. 4th 863 (2007) ................................................................................... 14 Haskell v. Time, Inc., 857 F. Supp. 1392 (E.D. Cal. 1994) ................................................................... 16, 17 Hodge v. Superior Court, 145 Cal. App. 4th 278 (2006) ................................................................................... 17 In re iPhone 4s Consumer Litig., 637 F. App’x 414 (9th Cir. 2016) ....................................................................... 17, 20 Kearns v. Ford Motor Co., 567 F.3d 1120 (9th Cir. 2009) .................................................................................. 13 Larsen v. Vizio, Inc., No. 14-SACV-1865, 2017 WL 3084273 (C.D. Cal. June 26, 2017) ....................... 18 McKesson HBOC, Inc. v. New York State Common Ret. Fund, Inc., 339 F.3d 1087 (9th Cir. 2003) .................................................................................. 18 Moss v. Infinity Ins. Co., 197 F. Supp. 3d 1191 (N.D. Cal. 2016) .................................................................... 18 19 20 21 22 23 24 25 26 Mullins v. Premier Nutrition Corp., No. 13-CV-01271-RS, 2018 WL 510139 (N.D. Cal. Jan. 23, 2018) ....................... 18 Painter v. Blue Diamond Growers, No. 17-cv-2235, 2017 WL 4766510 (C.D. Cal. May 24, 2017) .............................. 13 Pitre v. Wal-Mart Stores, Inc., No. SACV171281DOCDFMX, 2017 WL 11093619 (C.D. Cal. Nov. 8, 2017) ......................................................................................................................... 14 Polo v. Innoventions Int’l, LLC, 833 F.3d 1193 (9th Cir. 2016) .................................................................................. 14 27 28 Gibson, Dunn & Crutcher LLP 6 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 7 of 22 Page ID #:197 1 2 3 4 5 6 7 8 9 Red v. Kraft Foods, Inc., No. CV 10-1028-GW AGRX, 2012 WL 5504011 (C.D. Cal. Oct. 25, 2012) ......................................................................................................................... 21 Rivas v. Coverall N. Am., Inc., No. SACV181007JGBKKX, 2019 WL 7166972 (C.D. Cal. Feb. 28, 2019) ........................................................................................................................... 9 Saitsky v. DirecTV, Inc., No. CV 08-7918 AHM (CWX), 2009 WL 10670629 (C.D. Cal. Sept. 22, 2009) ................................................................................................................... 20 Sonner v. Premier Nutrition Corp., No. 18-15890, 2020 WL 3263043 (9th Cir. June 17, 2020) .................................... 18 10 11 12 13 14 15 16 17 Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308 (2007).................................................................................................... 9 US Ecology, Inc. v. State of California, 129 Cal. App. 4th 887 (2005) ................................................................................... 14 Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097 (9th Cir. 2003) .................................................................................. 13 Walker v. NDeX W. LLC, No. CV142940FMOJCGX, 2015 WL 12732460 (C.D. Cal. Feb. 20, 2015) ......................................................................................................................... 15 18 19 20 21 22 23 24 In re Yahoo! Inc. Customer Data Sec. Breach Litig., No. 16-MD-02752-LHK, 2017 WL 3727318 (N.D. Cal. Aug. 30, 2017) ......................................................................................................................... 19 Yunker v. Pandora Media, Inc., No. 11-CV-03113 JSW, 2013 WL 1282980 (N.D. Cal. Mar. 26, 2013) ................. 19 Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981 (9th Cir. 2009) .................................................................................... 13 25 Statutes 26 Cal. Bus. Prof. Code § 17204 ........................................................................................ 14 27 Cal. Bus. Prof. Code § 17500 ........................................................................................ 21 28 Cal. Civ. Code § 1761 .................................................................................................... 19 Gibson, Dunn & Crutcher LLP 7 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 8 of 22 Page ID #:198 1 2 3 4 5 Cal. Civ. Code § 1770 .................................................................................................... 20 Cal Civ. Code § 1780 ..................................................................................................... 14 Cal. Civ. Code § 1781.100 ............................................................................................. 21 Cal. Civ. Code § 1798.150 ............................................................................................. 21 6 Other Authorities 7 Judicial Council of California Civil Jury Instructions (2020) No. 303 ......................... 14 8 1 Witkin, Summary 11th Contracts § 1053 (2019) ....................................................... 14 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Gibson, Dunn & Crutcher LLP 8 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 9 of 22 Page ID #:199 1 MEMORANDUM OF POINTS AND AUTHORITIES 2 I. INTRODUCTION This lawsuit is an unjust attempt to exploit Draper James’ good intentions to 3 4 honor the teacher community by gifting hundreds of free dresses. To acknowledge the 5 efforts of educators during the COVID-19 pandemic, Draper James issued the below 6 social media post explaining that teachers were eligible to apply for a free dress, and 7 that the offer was “valid while supplies last”: 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Request for Judicial Notice (“RJN”) Ex. A (emphases added).1 23 24 25 26 27 28 1 The Instagram post is “incorporated into the complaint by reference” and thus appropriate to consider “when ruling on 12(b)(6) motions to dismiss.” Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007); see Doc. 1-2 ¶¶ 4, 26, 31; see also Rivas v. Coverall N. Am., Inc., No. SACV181007JGBKKX, 2019 WL 7166972, at *2 (C.D. Cal. Feb. 28, 2019) (“[T]he ‘incorporation by reference’ doctrine . . . permits [courts] to take into account documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the plaintiff’s pleading.”) (citation omitted). Gibson, Dunn & Crutcher LLP 9 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 10 of 22 Page ID #:200 1 Plaintiffs attempt to avoid common sense, and the plain language of the 2 Instagram post, by arguing that this promotion obligates Draper James to give a free 3 dress to every teacher who responded. No reasonable respondent would share 4 Plaintiffs’ belief that a boutique clothing line would be awarding a limitless supply of 5 free dresses. And the words “apply,” “winners,” and the phrase “offer valid while 6 supplies last” made clear that entrants had an opportunity to receive a free dress—an 7 opportunity that they received. Plaintiffs never explain how they could have been 8 harmed by Draper James’ good intentions, and its free promotion of a limited number 9 of dresses for hard-working teachers. Plaintiffs’ inability to articulate any deception, 10 the absence of any harm, and the other fundamental pleading flaws detailed below all 11 require that this case be dismissed with prejudice. 12 II. FACTUAL BACKGROUND 13 Plaintiffs Laryssa Galvez, Judith Lindley, and Natalie Anderson bring this 14 lawsuit because they are disappointed that they were not among the hundreds of lucky 15 teachers who received a free Draper James dress. Doc. 1-2 ¶¶ 1–3, 9. They claim the 16 free dress giveaway was actually an unlimited, binding contract that required Draper 17 James to send a free dress to “close to a million” teachers across the country. Id. ¶¶ 2– 18 3, 19. Plaintiffs bring this putative class action on behalf of all persons “who signed 19 up for the Draper James offer” and “provided personal information” in order to enter 20 the promotion. Id. ¶ 17. 21 The Instagram post that Plaintiffs point to as the “offer,” however, did not 22 promise a free dress to all who responded. Doc. 1-2 ¶ 26. Instead, it said the company 23 wanted to “say thank you,” and recognize the hard work of the teacher community 24 “[d]uring quarantine.” Id. It instructed those interested to “apply” for a free dress by 25 clicking on a link on the Draper James Instagram page. Id. The promotion expressly 26 stated it was valid “while supplies last.” RJN Ex. A; Doc. 1-2 ¶¶ 4, 31. 27 28 Plaintiffs notably do not allege that they actually signed up for the giveaway, much less that they saw the Instagram post, or that they relied on it in any way. Doc. Gibson, Dunn & Crutcher LLP 10 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 11 of 22 Page ID #:201 1 1-2 ¶ 9. Plaintiffs also neglect to include in their Complaint the Instagram post that 2 they claim is at the center of their lawsuit. 3 Plaintiffs have nonetheless incorporated the Instagram post by reference and 4 Defendants have submitted the Instagram post with their request for judicial notice. 5 As the Instagram post makes clear (see ante 9), there was never a suggestion that every 6 respondent would receive a free dress. The offer was “valid while supplies last.” Doc. 7 1-2 ¶¶ 4, 31. It also announced that “winners” would be selected on April 7, 2020. Id. 8 ¶ 26. Plaintiffs admit that such disclosures were made, but claim they were “vague 9 illusory comment[s]” that provided “no indication” as to the limited number of dresses 10 available. Id. ¶ 31. According to the Complaint, the failure to include a “specific 11 limitation on quantity” made it unclear that the giveaway “was limited to 250 dresses.” 12 Id. ¶ 4 (emphasis added). Plaintiffs, however, do not allege that they (or anyone else 13 for that matter) would have refused to participate had the original Instagram post 14 detailed the specific number of dresses being awarded. 15 Those interested in the promotion could sign up by clicking a link on the Draper 16 James Instagram page, which directed potential participants to an entry form. Id. ¶ 27. 17 To participate in the giveaway, the form asked applicants to supply their contact 18 information, including information to allow Draper James to verify they were teachers. 19 Id. Plaintiffs maintain that this information “could be exploited by cyber-criminals” or 20 “sold.” Id. ¶ 2. There are no allegations in the Complaint that any of those 21 hypothetical events have occurred, and Plaintiffs do not allege that they actually 22 submitted any personal identification information as a part of any submission to 23 participate in the promotion. 24 The announcement of the giveaway on Instagram was accompanied by a list of 25 “Frequently Asked Questions” (“FAQ”) published on Draper James’ website. 26 Plaintiffs allege that “nothing in any initial FAQ disseminated by Defendants disclosed 27 a limitation this offer was limited,” and that there was “no indication this was some 28 form of lottery.” Id. ¶ 31. But in addition to reiterating that the offer was valid “while Gibson, Dunn & Crutcher LLP 11 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 12 of 22 Page ID #:202 1 supplies last,” the FAQ, which is incorporated by reference in the Complaint, explicitly 2 disclosed that applicants would be “vetted and selected in a lottery.” RJN Ex. B 3 (emphasis added). 4 As Plaintiffs state, the announcement of the giveaway was received with 5 widespread public support. Doc. 1-2 ¶ 33–34. The Instagram post reached a broad 6 audience, and many teachers—even those who were not selected to receive a free 7 dress—commented on the importance of the giveaway to them in a time of crisis. Id. 8 ¶ 35. The overwhelming response to the giveaway prompted Draper James to provide 9 non-winning entrants with a 30% discount on the Draper James website. Id. ¶ 41. 10 Plaintiffs attempt to cast Draper James’ sincere appreciation for educators as 11 some sort of alleged scheme. They bring five causes of action against Defendants, 12 claiming breach of contract, promissory estoppel, unjust enrichment, violations of the 13 California Legal Remedies Act (“CLRA”), and violations of California Business and 14 Professions Code § 17200 (“UCL”). Doc. 1-2 ¶¶ 49–100. They seek damages, 15 injunctive relief, specific performance, and attorneys’ fees and costs, and interest. Id. 16 at 26–27, Prayer for Relief (1)–(6). 17 III. LEGAL STANDARD 18 To survive dismissal, “a complaint must contain sufficient factual matter, 19 accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. 20 Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 21 570 (2007)). A claim is facially plausible when a plaintiff “pleads factual content that 22 allows the court to draw the reasonable inference that the defendant is liable for the 23 misconduct alleged.” Id. Although a court analyzing a motion to dismiss “must accept 24 the allegations of the complaint as true,” it “is not required to accept legal conclusions” 25 or “allegations that are merely conclusory, unwarranted deductions of fact, or 26 unreasonable inferences.” Capaci v. Sports Research Corp., No. 19-CV-3440-FMO, 27 2020 WL 1482313, at *2–3 (C.D. Cal. Mar. 26, 2020) (citations omitted). After 28 stripping away the conclusory statements, the remaining factual allegations in a Gibson, Dunn & Crutcher LLP 12 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 13 of 22 Page ID #:203 1 complaint must do more than “create[] a suspicion of a legally cognizable right of 2 action”; they must “raise a right to relief above the speculative level.” Twombly, 550 3 U.S. at 555 (citation, internal quotation marks, and brackets omitted). “Determining 4 whether a complaint states a plausible claim for relief” is “a context-specific task that 5 requires the reviewing court to draw on its judicial experience and common sense.” 6 Iqbal, 556 U.S. at 679. 7 Plaintiffs’ fraud-based claims under the UCL and CLRA also must satisfy the 8 heightened pleading requirements of Federal Rule of Civil Procedure 9(b), which 9 requires that a plaintiff “state with particularity the circumstances constituting fraud.” 10 Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009) (applying Rule 9(b) to 11 UCL and CLRA claims). “Averments of fraud must be accompanied by ‘the who, 12 what, when, where, and how’ of the misconduct charged.” Vess v. Ciba-Geigy Corp. 13 USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (citation omitted). 14 Dismissal with prejudice is appropriate where amendment would be futile. 15 Painter v. Blue Diamond Growers, No. 17-cv-2235, 2017 WL 4766510, at *3 (C.D. 16 Cal. May 24, 2017); see also Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981, 17 1007 (9th Cir. 2009). 18 IV. ARGUMENT 19 There is no legal basis for any of Plaintiffs’ claims. Not only have they failed to 20 allege that they even participated in the giveaway, the breach-of-contract claims defy 21 common sense and are based on a gross mischaracterization of the Instagram post. 22 Plaintiffs’ UCL, CLRA, and unjust enrichment claims fail to allege that a reasonable 23 consumer would believe that everyone who responded was guaranteed a free dress, and 24 the claims are also precluded by the adequate-remedy-at-law doctrine. This suit should 25 be dismissed with prejudice. 26 A. All of Plaintiffs’ Claims Fail Because Plaintiffs Do Not Allege They Entered 27 into the Giveaway, Much Less Allege that Defendants Caused Them Harm. 28 A bedrock element missing from of each of Plaintiffs’ claims is any allegation Gibson, Dunn & Crutcher LLP 13 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 14 of 22 Page ID #:204 1 that they actually signed up for the promotion. Without alleging facts showing how 2 and why they purportedly signed up to receive a free dress, all of Plaintiffs’ claims fail. 3 For their breach-of-contract claim, Plaintiffs must adequately allege that the 4 “breach of contract was a substantial factor in causing [their] harm.” Judicial Council 5 of California Civil Jury Instructions (2020) No. 303; see also Haley v. Casa Del Rey 6 Homeowners Assn., 153 Cal. App. 4th 863, 871–72 (2007). Similarly, promissory 7 estoppel and unjust enrichment require a causal connection to the defendant that 8 resulted in harm. US Ecology, Inc. v. State of California, 129 Cal. App. 4th 887, 904– 9 05 (2005); Griffith Co. v. Hofues, 201 Cal. App. 2d 502, 508 (1962); 1 Witkin, 10 Summary 11th Contracts § 1053 (2019). Likewise, to establish statutory standing 11 under the UCL, a plaintiff must show that he “suffered injury in fact and [] lost money 12 or property as a result of” the defendant’s conduct. Cal. Bus. Prof. Code § 17204 13 (emphasis added).2 And the CLRA requires a “consumer” to suffer “damage as a 14 result of” a misrepresentation, Cal Civ. Code § 1780 (emphasis added), which requires 15 a plaintiff to allege that he “purchased a product from the defendant, and [] that ‘the 16 purchase would not have been made but for the misrepresentation.’” Polo v. 17 Innoventions Int’l, LLC, 833 F.3d 1193, 1198 (9th Cir. 2016) (citation omitted). 18 Here, the Complaint discloses only two facts about the named Plaintiffs: their 19 names, and that they are “each natural persons.” Doc. 1-2 ¶ 9. There is no allegation 20 that Plaintiffs were eligible for the promotion, that they entered into the giveaway, or 21 that they actually saw and relied on the various “misrepresentations” they allege. See 22 id. ¶ 38. There are also no allegations that Plaintiffs suffered any actual harm. 23 Without any facts to indicate participation, reliance, or harm, the Complaint 24 comes nowhere close to establishing the causal connection and injury needed to 25 support each of the pleaded claims. This Court regularly dismisses complaints at the 26 27 28 2 And under the UCL, personal information is not considered “lost money or property.” Pitre v. Wal-Mart Stores, Inc., No. SACV171281DOCDFMX, 2017 WL 11093619, at *4 (C.D. Cal. Nov. 8, 2017); In re Facebook Privacy Litig., 791 F. Supp. 2d 705, 714–15 (N.D. Cal. 2011). Gibson, Dunn & Crutcher LLP 14 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 15 of 22 Page ID #:205 1 pleading stage where, as here, “plaintiffs fail to allege how defendants’ conduct caused 2 the harm they suffered.” Walker v. NDeX W. LLC, No. 14-CV-2940-FMO, 2015 WL 3 12732460, at *4 (C.D. Cal. Feb. 20, 2015) (dismissing plaintiffs’ UCL claim). 4 Plaintiffs cannot establish either causation or harm—from what is pleaded in the 5 Complaint, it is entirely possible that Plaintiffs never applied at all, or that they did not 6 even see any of the statements that the Complaint attacks.3 7 B. The Claims Sounding in Contract Also Fail Because Plaintiffs Do Not 8 Allege They Entered Into an Agreement Nor That It Was Breached. 9 Plaintiffs’ lawsuit is based on the premise that “Defendants made an offer that 10 promised to render performance (providing new dresses) in exchange for something 11 requested by Defendants (personal sensitive information from Plaintiffs and class 12 members).” Doc. 1-2 ¶ 2. But Plaintiffs never allege that they entered into an 13 agreement in the first place, and this characterization of the “contract” rests on a gross 14 misstatement of the plain language of the promotion. 15 Plaintiffs allege no facts indicating that they signed up for the giveaway or 16 provided any personal sensitive information based on an expectation that they would 17 be guaranteed a free dress by doing so. Id. ¶ 51. Thus, Plaintiffs fail to set forth facts 18 describing the terms of the contract, and they also fail to allege facts demonstrating 19 that Plaintiffs did anything to accept the purported contract. Brown v. Superior Court, 20 199 Cal. App. 4th 971, 992 (2011) (binding contract is not created unless plaintiff 21 demonstrates acceptance of a valid offer). Plaintiffs’ failure to allege they accepted 22 the alleged offer, and failure to allege that the terms of the offer were communicated to 23 them, require the contract claims be dismissed. 24 25 26 27 28 3 It is also unclear whether Plaintiffs may invoke the law they seek to apply, as there are no details as to where they reside. “Courts in the Ninth Circuit have consistently held that a plaintiff in a putative class action lacks standing to assert claims under the laws of states other than those where the plaintiff resides or was injured.” Chansue Kang v. P.F. Chang’s China Bistro, Inc., No. CV 19-02252 PA (SPX), 2020 WL 2027596, at *3 (C.D. Cal. Jan. 9, 2020) (citation omitted). Gibson, Dunn & Crutcher LLP 15 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 16 of 22 Page ID #:206 1 Even if Plaintiffs could allege that they saw the terms of the promotion, and 2 responded, the claims would still fail. There is no support for Plaintiffs’ argument that 3 the Instagram post guaranteed every entrant a free dress. The actual words in the 4 Instagram post instructed individuals to “apply” through an entry form. RJN Ex. A 5 (emphasis added). It announced that “winners” would be notified on April 7. Id. 6 (emphasis added). To reinforce these points, the Instagram post stated that the offer 7 was available “while supplies last.” Id. Common sense and ordinary experience also 8 confirm that the giveaway was of a limited quantity, and that not everyone would be 9 receiving a free dress. Rather than indicating some sort of guarantee, the words and 10 context made clear that signing up made one eligible to receive a dress (“apply”), and 11 that some entrants would be selected to receive one (“winners”). Plaintiffs’ claim that 12 there was “no indication this was some form of lottery,” Doc. 1-2 ¶ 31, is again 13 contradicted by the terms of the promotion referring to winners, applicants, and a 14 limited supply. Doc. 1-2 ¶¶ 4, 26. In addition, the FAQ Plaintiffs cite in their 15 Complaint expressly told applicants that they would be “vetted and selected in a 16 lottery.” RJN Ex. B (emphasis added). 17 It is telling that Plaintiffs never claim to have believed that there was no 18 limitation on quantity whatsoever, or that they thought that a free dress would be 19 delivered to them if they signed up for the promotion. Id. ¶ 31. Any such assertion 20 would be completely implausible in any event. Haskell v. Time, Inc., 857 F. Supp. 21 1392, 1399 (E.D. Cal. 1994) (dismissing lawsuit based on magazine sweepstakes 22 solicitation because “[a]ny reasonable recipient, even if unsophisticated, understands 23 that these [materials are] part of an advertising campaign”). Because Plaintiffs do not, 24 and cannot, allege that they expected to receive a free dress based on the written terms 25 of the promotion, they have failed to allege any facts that would show they received 26 anything less than was being offered, much less that a contract existed and was 27 breached. 28 Gibson, Dunn & Crutcher LLP 16 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 17 of 22 Page ID #:207 1 The language in the Instagram post here is far more clear than the announcement 2 in Freeman v. Time, Inc., where the Ninth Circuit considered two personalized mailers 3 for a “Million Dollar Dream Sweepstakes” promotion. 68 F.3d 285, 287 (9th Cir. 4 1995). Large type on the mailers in Freeman read: “If you return the grand prize 5 winning number, we’ll officially announce that MICHAEL FREEMAN HAS WON 6 $1,666,675.00 AND PAYMENT IS SCHEDULED TO BEGIN,” while smaller type 7 included language that the “selection of the winner” would take place by April 1, 1994. 8 Id. The Ninth Circuit rejected the same argument that Plaintiffs make here: that the 9 promotional language left “room for the reader to draw an inference that he or she has 10 the winning number.” Id. at 290. It explained that “no reasonable addressee could 11 believe that the mailing announced that the addressee was already the winner,” as any 12 ambiguity was “dispelled by the promotion as a whole.” Id. (citing Haskell, 857 F. 13 Supp. at 1403). If the broad announcement that an individual “has won” over a million 14 dollars and “payment is scheduled to begin” was not enough to guarantee a prize in 15 Freeman, then allowing entrants to “apply” to a “while supplies last” promotion cannot 16 create a contractual obligation to provide a limitless supply of free dresses here. 17 In the end, those who signed up for the promotion received exactly what they 18 expected: an opportunity to win a free dress. That the Plaintiffs may not have been 19 selected as one of the lucky recipients does not give rise to a breach-of-contract claim. 20 Plaintiffs do not, and could not, allege they understood the Instagram post as a 21 guarantee of a free dress to all. See In re iPhone 4s Consumer Litig., 637 F. App’x 22 414, 416 (9th Cir. 2016). Plaintiffs’ breach-of-contract claims should be dismissed. 23 C. The Equitable Claims Also Fail Because There Is an Adequate Remedy at 24 Law. 25 Plaintiffs’ equitable claims have another independent flaw—they are unavailable 26 because Plaintiffs have not established that they lack adequate remedies at law. “[T]he 27 UCL provides only for equitable remedies,” see Hodge v. Superior Court, 145 Cal. 28 App. 4th 278, 284 (2006), “[u]njust enrichment is an equitable rather than a legal Gibson, Dunn & Crutcher LLP 17 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 18 of 22 Page ID #:208 1 claim,” McKesson HBOC, Inc. v. New York State Common Ret. Fund, Inc., 339 F.3d 2 1087, 1091 (9th Cir. 2003), and Plaintiffs seek only equitable relief under the CLRA. 3 Doc. 1-2 ¶ 91 (“Defendants should be ordered to pay restitution as well as be 4 enjoined . . . .”). Because Plaintiffs have not demonstrated an inadequate remedy at 5 law, their claims for equitable relief under these statutes cannot proceed. As the Ninth Circuit explained last month, “the traditional principles governing 6 7 equitable remedies in federal courts, including the requisite inadequacy of legal 8 remedies, apply when a party requests restitution . . . in a diversity action.” Sonner v. 9 Premier Nutrition Corp., No. 18-15890, 2020 WL 3263043, at *7 (9th Cir. June 17, 10 2020). Thus, Plaintiffs must establish that they “lack[] an adequate remedy at law 11 before securing equitable restitution for past harm under the UCL, . . . CLRA,” id., and 12 unjust enrichment. Larsen v. Vizio, Inc., No. 14-SACV-1865, 2017 WL 3084273, at 13 *6 (C.D. Cal. June 26, 2017). The question is not whether Plaintiffs are likely to 14 prevail on their legal claims, but whether, assuming they could prevail, the available 15 remedy would be “adequate.” Mullins v. Premier Nutrition Corp., No. 13-CV-01271- 16 RS, 2018 WL 510139, at *2 (N.D. Cal. Jan. 23, 2018). Even where plaintiffs have 17 inadequately pleaded claims at law, as in this case, courts still dismiss plaintiffs’ 18 equitable causes of action. See, e.g., Gomez v. Jelly Belly Candy Co., No. 17-CV- 19 0575, 2017 WL 8941167, at *2 (C.D. Cal. Aug. 18, 2017); Moss v. Infinity Ins. Co., 20 197 F. Supp. 3d 1191, 1203 (N.D. Cal. 2016). 21 Here, Plaintiffs seek monetary relief for their breach-of-contract claims, see 22 Doc. 1-2 ¶¶ 58, 64, and plead no facts suggesting these legal remedies would be 23 inadequate. Accordingly, they cannot bring UCL, CLRA, or unjust enrichment claims 24 as a matter of law. 25 D. 26 27 The CLRA Claim Has Other, Additional Flaws that Require Dismissal. On top of the lack of causation and harm, and the fact that their CLRA claim is unavailable as a matter of law, there are three additional reasons the CLRA claim fails 28 Gibson, Dunn & Crutcher LLP 18 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 19 of 22 Page ID #:209 1 as a matter of law: (1) Plaintiffs are not “consumers”; (2) the CLRA specifically allows 2 while-supplies-last promotions; and (3) no reliance or misrepresentation occurred. 3 First, Plaintiffs are not “consumers” who can invoke the CLRA. Claridge v. 4 RockYou, Inc., 785 F. Supp. 2d 855, 864 (N.D. Cal. 2011). This “strict requirement,” 5 id., mandates that only “an individual who seeks or acquires, by purchase or lease, any 6 goods or services for personal, family, or household purposes” may invoke the statute. 7 Cal. Civ. Code § 1761(d). The phrase “by purchase or lease” requires money to be 8 exchanged: the “generalized notion that the phrase ‘purchase’ or ‘lease’ contemplates 9 any less than tangible form of payment . . . finds no support under the specific statutory 10 language of the CLRA.” Claridge, 785 F. Supp. 2d at 864; Casillas v. Northgate 11 Gonzalez Markets, Inc., No. SACV1600064CJCKESX, 2016 WL 10966424, at *3 12 (C.D. Cal. May 11, 2016) (plaintiff who “sought a free concert ticket” not a 13 “‘consumer’”). For this reason, federal courts in California have repeatedly rejected 14 the “theory” Plaintiffs offer here, namely that the “transfer of [personally identifiable] 15 information” constitutes a “‘purchase’ or ‘lease’ under the CLRA.” Id.; see also 16 Yunker v. Pandora Media, Inc., No. 11-CV-03113 JSW, 2013 WL 1282980, at *12 17 (N.D. Cal. Mar. 26, 2013); In re Yahoo! Inc. Customer Data Sec. Breach Litig., No. 18 16-MD-02752-LHK, 2017 WL 3727318, at *33 (N.D. Cal. Aug. 30, 2017) (rejecting 19 “Plaintiffs’ theory that the mere transfer of [personally identifiable information] 20 renders . . . a ‘purchase’ or ‘lease’” under the CLRA). Because Plaintiffs allege only 21 that “consumers” provided their “personal information” to Defendants, Doc. 1-2 ¶¶ 8, 22 44, and do not allege that they actually paid any money to participate in the promotion, 23 this Court should dismiss their claim under the CLRA for failure to establish that 24 Plaintiffs are consumers. 25 Second, even if Plaintiffs could invoke the statute, the CLRA specifically allows 26 for while-supplies-last promotions. The “unfair or deceptive acts” described in the 27 CLRA include “[a]dvertising goods or services with intent not to supply reasonably 28 expectable demand, unless the advertisement discloses a limitation of quantity.” Cal. Gibson, Dunn & Crutcher LLP 19 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 20 of 22 Page ID #:210 1 Civ. Code § 1770(a)(10) (emphasis added). The complaint assails Defendants for 2 failing to include a “specific limitation on quantity” that the giveaway “was limited to 3 250 dresses.” Doc. 1-2 ¶ 4 (emphasis added). But there is nothing in section 4 1770(a)(10) that requires the limitation of quantity to be “specific,” or precise as to the 5 exact number of goods available. It simply requires a disclosure of “a limitation”— 6 exactly what Draper James did in the Instagram post. 7 Finally, Plaintiffs’ CLRA claim fails because no misrepresentation occurred. 8 Courts dismiss CLRA claims where “it is not plausible that a significant portion of the 9 general consuming public or of targeted consumers, acting reasonably in the 10 circumstances, could be misled.” Ebner v. Fresh, Inc., 838 F.3d 958, 966 (9th Cir. 11 2016) (citation omitted). As explained previously, see ante 15–17, it is not plausible 12 that a significant portion of the public would believe that Draper James was offering an 13 unlimited supply of free dresses through its promotion. See In re iPhone 4s Consumer 14 Litig., 637 F. App’x at 416. 15 E. Plaintiffs’ UCL Claim Also Fails Because the Promotion Was As 16 Advertised. 17 Plaintiffs’ UCL claim fails for all the reasons described above: Plaintiffs failed 18 to adequately allege causation and harm and thus lack standing, and there is an 19 adequate remedy at law. In addition, Plaintiffs cannot plausibly allege that 20 Defendants’ conduct was unfair, unlawful, or fraudulent. “An act or practice is unfair 21 if the consumer injury is substantial, is not outweighed by any countervailing benefits 22 to consumers or to competition, and is not an injury the consumers themselves could 23 reasonably have avoided.” Saitsky v. DirecTV, Inc., No. CV 08-7918 AHM (CWX), 24 2009 WL 10670629, at *2 (C.D. Cal. Sept. 22, 2009) (quoting Daugherty v. Am. 25 Honda Motor Co., Inc., 144 Cal. App. 4th 824, 839 (2006)). 26 Plaintiffs have failed to plausibly allege any injury at all—much less one not 27 outweighed by countervailing benefits. See ante 13–15. Plaintiffs cannot transform 28 the plain text of the Instagram post into a “practice [that] offends an established public Gibson, Dunn & Crutcher LLP 20 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 21 of 22 Page ID #:211 1 policy” or is “immoral, unethical, oppressive, unscrupulous or substantially injurious 2 to consumers,” as is required for “unfair” conduct under the UCL. Bardin v. 3 DaimlerChrysler Corp., 136 Cal. App. 4th 1255, 1263 (2006). Nor can Plaintiffs 4 transform the giveaway into something “unlawful.” Plaintiffs allege that Defendants’ 5 conduct was “unlawful” because it violated the CLRA, the California Consumer 6 Privacy Act (CCPA), Cal. Civ. Code § 1781.100, and Business & Professions Code 7 § 17500, which applies to false or misleading statements in advertising. Doc. 1-2 8 ¶ 96–97. 9 Defendants have already explained that the CLRA does not apply. See ante 18– 10 20. The CCPA, meanwhile, cannot be used as a “basis for a private right of action 11 under any other law.” Cal. Civ. Code § 1798.150(c). And Plaintiffs’ argument as 12 Business & Professions Code § 17500 fails for the same reasons as their arguments as 13 to Defendants’ “fraudulent” conduct: there is no fraud when a plaintiff “read[s] a true 14 statement” and then “assume[s] things . . . other than what the statement actually 15 says.” Red v. Kraft Foods, Inc., No. CV 10-1028-GW AGRX, 2012 WL 5504011, at 16 *3 (C.D. Cal. Oct. 25, 2012). Because the giveaway was as advertised, and caused no 17 harm to Plaintiffs, no unfair, unlawful, or fraudulent conduct occurred. This Court 18 should dismiss the UCL claim with prejudice. 19 20 V. CONCLUSION Draper James gifted hundreds of free dresses to honor the teacher community 21 doing incredible work under trying circumstances. The post clearly explained that the 22 dresses would be given to “winners” “while supplies last.” Plaintiffs never allege that 23 they even signed up for the promotion. And even if they did, there was nothing 24 fraudulent, misleading, or otherwise unlawful about it—indeed, Plaintiffs never allege 25 that they actually thought that they would be guaranteed a free dress if they simply 26 submitted an entry. And no amendment to the complaint can make the Instagram post 27 say anything other than that a limited supply of dresses were being given away to 28 Gibson, Dunn & Crutcher LLP 21 Case 2:20-cv-04976-FMO-SK Document 19 Filed 07/10/20 Page 22 of 22 Page ID #:212 1 lucky teachers who applied and were selected as winners. Future amendment would 2 therefore be futile, and this Court should dismiss the complaint with prejudice. 3 Dated: July 10, 2020 4 GIBSON, DUNN & CRUTCHER LLP 5 6 By: 7 8 9 /s/ Theane Evangelis Theane Evangelis Attorneys for DEFENDANTS DRAPER JAMES, LLC AND REESE WITHERSPOON 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Gibson, Dunn & Crutcher LLP 22