Amanda Sateriale et al v. R J Reynolds Tobacco Co et al

Filing 186

MINUTES (IN CHAMBERS): ORDER by Judge Christina A. Snyder: DENYING 161 DEFENDANTS MOTION TO CERTIFY FOR INTERLOCUTORY APPEAL THE COURTS ORDERDENYING DEFENDANTS MOTION FOR SUMMARY JUDGMENT. (shb)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

2:09-cv-08394-CAS(SSx)

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

Present: The Honorable

Date

‘O’

June 17, 2015

CHRISTINA A. SNYDER

Catherine Jeang
Deputy Clerk

Not Present
Court Reporter / Recorder

N/A
Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

(IN CHAMBERS): DEFENDANT’S MOTION TO CERTIFY
FOR INTERLOCUTORY APPEAL THE COURT’S ORDER
DENYING DEFENDANT’S MOTION FOR SUMMARY
JUDGMENT (dkt. 161, filed April 23, 2015)

The Court finds this motion appropriate for decision without oral argument. Fed.
R. Civ. P. 78; Local Rule 7-15. Accordingly, the hearing currently scheduled for June
22, 2015, is hereby vacated, and the matter is taken under submission.
I.

INTRODUCTION & BACKGROUND

The facts of this case are known to the parties and are set forth in this Court’s prior
orders on defendant R.J. Reynolds Tobacco Company’s (“RJR”) motion for summary
judgment, dkt. 136, and plaintiffs Amanda Sateriale, Jeffrey Feinman, Pamela Burns,
Patrick Griffiths, Jackie Warren, and Donald Wilson’s motion for class certification, dkt.
135. The facts and procedural history most relevant to the present motion are as follows.
Plaintiffs filed this action in 2009, asserting claims for, inter alia, breach of
bilateral contract and promissory estoppel. The Court dismissed the entire action with
prejudice in December 2010, and plaintiffs subsequently appealed the Court’s decision to
the Ninth Circuit. The Ninth Circuit vacated dismissal of the breach of contract and
promissory estoppel claims, reasoning that plaintiffs had “adequately alleged the
existence of an offer to enter into a unilateral contract, whereby RJR promised to provide
rewards to customers who purchased Camel cigarettes, saved Camel Cash certificates and
redeemed their certificates in accordance with the catalogs’ terms.” Sateriale v. R.J.
Reynolds Tobacco Co., 697 F.3d 777, 787 (9th Cir. 2012) (emphasis added).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

Following remand and discovery, RJR moved for summary judgment. The Court
denied RJR’s motion by order dated December 19, 2014 (“Summary Judgment Order”).
In so doing, the Court concluded that the representations on C-Notes constituted an offer
by RJR to make “goods” and “stuff” available for redemption for the life of the Camel
Cash program, and that RJR invited plaintiffs to accept this offer by purchasing Camel
cigarettes and saving the C-Notes included therein.
As is relevant here, RJR vigorously argued that, in order to accept its offer,
plaintiffs were also required to redeem or attempt to redeem their C-Notes during the
final six months of the Camel Cash program. The Court rejected this argument,
reasoning that “[c]onstruing RJR’s offer to require such performance by plaintiffs . . .
would render the contract non-existent.” Summ. J. Order at 12. As the Court explained,
the Ninth Circuit found that plaintiffs alleged a contract, “the essence of which was their
general right to redeem their Camel Cash certificates, during the life of the program, for
whatever rewards merchandise RJR made available, with RJR’s discretion limited only
by the implied duty of good faith performance.” Summ. J. Order at 13 (quoting Sateriale,
697 F.3d at 788 (emphasis added)). The Court reasoned that construing RJR’s offer to
require acceptance through redemption would be “incongruous with such a ‘right to
redeem,’ ” id. at 13, since plaintiffs’ theory of the case was that RJR breached the
contract by acting in bad faith to deny them the opportunity to redeem their C-Notes for
non-tobacco merchandise.
On April 23, 2015, RJR filed a motion pursuant to 28 U.S.C. § 1292(b), seeking to
certify for interlocutory appeal the Court’s Summary Judgment Order. Dkt. 161.
Plaintiffs filed an opposition on June 1, 2015, dkt. 174, and RJR replied on June 8, 2015,
dkt. 181. Having carefully considered the parties’ arguments, the Court finds and
concludes as follows.
II.

LEGAL STANDARD

Certification of an interlocutory appeal pursuant to 28 U.S.C. § 1292(b) provides a
means for litigants to bring an immediate appeal of a non-dispositive order with the
consent of both the district court and the court of appeals. 28 U.S.C. § 1292(b); In re
Cement Antitrust Litig., 673 F.2d 1020, 1026 (9th Cir.1982). The district court may
certify an order for interlocutory appellate review under Section 1292(b) if each of the
following three requirements are met: “(1) there is a controlling question of law, (2) there
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

are substantial grounds for difference of opinion, and (3) an immediate appeal may
materially advance the ultimate termination of the litigation.” Id. at 1026; 28 U.S.C. §
1292(b). The requirements of section 1292(b) are jurisdictional. Couch v. Telescope
Inc., 611 F.3d 629, 633 (9th Cir.2010).
“[T]he legislative history of 1292(b) indicates that this section was to be used only
in exceptional situations in which allowing an interlocutory appeal would avoid
protracted and expensive litigation.” In re Cement Antitrust Litig., 673 F.2d at 1026
(citing United States Rubber Co. v. Wright, 359 F.2d 784, 785 (9th Cir.1966)). Indeed,
section 1292(b) embodies a “narrow exception to the final judgment rule.” Couch, 611
F.3d at 633. “The party seeking certification has the burden of showing that exceptional
circumstances justify a departure from the ‘basic policy of postponing appellate review
until after the entry of a final judgment.’ ” Fukuda v. County of Los Angeles, 630 F.
Supp. 228, 299 (C.D. Cal. 1986) (citing Coopers & Lybrand v. Livesay, 437 U.S. 463,
475 (1978)).
III.

ANALYSIS
A.

Whether There Is a Controlling Question of Law

In its moving papers, RJR asserts that the controlling question of law in this case is
“whether the Ninth Circuit, in construing the claims pleaded in the operative complaint in
this very case, required the specific act of redeeming C-Notes for rewards to accept
[RJR’s] offer to enter into a unilateral contract[.]” Mot. Cert. Appeal at 1. In its reply
briefing, RJR refashions the controlling question as “whether a unilateral contract can be
formed under California law where the offeree fails to perform each act requested by an
offeror.” Reply Mot. Cert. Appeal at 2.
A question is “controlling” if “resolution of the issue on appeal could materially
affect the outcome of litigation in the district court.” In re Cement Antitrust Litig., 673
F.2d at 1026. The question must be “of the meaning of a statutory or constitutional
provision, regulation, or common law doctrine rather than . . . whether the party opposing
summary judgment had raised a genuine issue of material fact.” Carrillo v. Schneider
Logistics Trans-Loading & Distribution, Inc., No. 2:11-CV-8557, 2014 WL 1155403, at
*3 (C.D. Cal. Mar. 21, 2014) (quoting Ahrenholz v. Bd. of Trustees of the Univ. of Ill.,
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

219 F.3d 674, 676 (7th Cir. 2000)). Indeed, “[t]he legal question must be stated at a high
enough level of abstraction to lift the question out of the details of the evidence of facts
of a particular case and give it general relevance to other cases in the same area of law.”
Porter v. Mabus, No. 1:07-CV-0825, 2014 WL 669778, at *2 (E.D. Cal. Feb. 20, 2014)
(quoting Simmons v. Akanno, 2011 WL 1566583, at *3 (E.D. Cal. Apr. 22, 2011)
(quoting McFarlin v. Conseco Services, LLC, 381 F.3d 1251, 1259 (11th Cir. 2004))).
“The antithesis of a proper § 1292(b) appeal is one that turns on whether there is a
genuine issue of fact, or whether the district court properly applied settled law to the
facts.” Id. (quoting Simmons, 2011 WL 1566583, at *3). Moreover, “the question of the
meaning of a contract, though technically a question of law when there is no other
evidence but the written contract itself, is not what the framers of section 1292(b) had in
mind.” Arenholz, 219 F.3d at 676-77 (citing Williamson v. UNUM Life Ins. Co., 160
F.3d 1247, 1251 (9th Cir. 1998); Harriscom Svenska AB v. Harris Corp., supra, 947 F.2d
627, 631 (2d Cir. 1991); United States Rubber Co. v. Wright, 359 F.2d 784 (9th
Cir.1966) (per curiam)).
RJR’s motion presents the “antithesis of a proper § 1292(b) appeal.” It is well
settled that, to form a unilateral contract under California law, an offeree accepts the offer
by performing acts requested by the offeror. See Harris v. Time, Inc., 191 Cal. App. 3d
449, 455 (1987). Here, RJR contests the Court’s application of this settled principle of
law to the facts of this case—namely, RJR resists the Court’s construction of the C-Notes
to permit acceptance of RJR’s offer without performing the act of redemption. RJR’s
vehement disagreement with the Court’s construction of the terms of its offer is not the
sort of “abstract legal issue,” Arenholz, 219 F.3d at 677, that merits invocation of the
narrow exception to the final judgment rule embodied in § 1292(b). See, e.g., Chehalem
Physical Therapy, Inc. v. Coventry Health Care, Inc., No. 09-CV-320, 2010 WL 952273,
at *3 (D. Or. Mar. 10, 2010) (explaining that “interpretation of the terms of a contract is a
mixed question of law and fact”); Aristocrat Leisure Ltd. v. Deutsche Bank Trust Co.
Americas, 426 F. Supp. 2d 125, 128 (S.D.N.Y. 2005) (“[A] question of contract
interpretation typically is not a ‘controlling question of law’ that serves as a basis for
interlocutory appeal.”).
B.

Whether Substantial Grounds for Difference of Opinion Exist

RJR contends that it has met its burden to establish the existence of substantial
grounds for a difference of opinion concerning the controlling question of law because
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

the Court’s Summary Judgment Order purportedly diverged from the Ninth Circuit’s
holding that redemption of C-Notes is an act required to accept RJR’s offer. Mot. Cert.
Appeal at 5. According to RJR, this departure “is precisely the type of difference of
opinion that compels certification of interlocutory review.” Id.
“To determine if a ‘substantial ground for difference of opinion’ exists under §
1292(b), courts must examine to what extent the controlling law is unclear.” Couch, 611
F.3d at 633. “Courts traditionally will find that a substantial ground for difference of
opinion exists where the circuits are in dispute on the question and the court of appeals of
the circuit has not spoken on the point, if complicated questions arise under foreign law,
or if novel and difficult questions of first impression are presented.” Id. (internal
quotation marks and citation omitted); see also Asis Internet Servs. v. Active Response
Grp., No. C07 6211, 2008 WL 4279695, at *3 (N.D. Cal. Sept. 16, 2008) (concluding
that “intra-district split” on controlling issue of law may also satisfy “substantial
grounds” factor). “That settled law might be applied differently does not establish a
substantial ground for difference of opinion.” Id.
Here, RJR’s proffered controlling question of law is “whether a unilateral contract
can be formed under California law where the offeree fails to perform each act requested by
an offeror.” The answer to this question is not unclear—as discussed above, the answer is
unequivocally “no.” RJR simply disagrees with this Court’s conclusion that, as
expressed in the C-Notes, redemption was not a requested act.
At bottom, RJR disagrees with the Court’s interpretation of its mandate on remand.
RJR contends that the Ninth Circuit’s conclusion that plaintiffs “adequately alleged the
existence of an offer to enter into a unilateral contract, whereby RJR promised to provide
rewards to customers who purchased Camel cigarettes, saved Camel Cash certificates and
redeemed their certificates in accordance with the catalogs’ terms,” Sateriale, 697 F.3d at
787 (emphasis added), is in no way informed by the Ninth Circuit’s additional finding
that the essence of the alleged contract was plaintiffs’ “general right to redeem their
Camel Cash certificates . . . with RJR’s discretion limited only by the implied duty of
good faith performance,” id. at 788. This Court, however, concluded otherwise. See
Summ. J. Order at (“Construing RJR’s offer to require acceptance by redeeming C-Notes,
rather than by purchasing Camels and saving C-Notes, is incongruous with such a ‘right
to redeem.’ Simply put, if redemption is the right created by the contract, it cannot also be
the method of acceptance.”). RJR’s disagreement with this Court’s interpretation of its
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

mandate on remand is not the sort of “substantial ground” for a difference of opinion
cognizable under section 1292(b). See Couch, 611 F.3d at 633 (“The district court
correctly held that ‘[a] party’s strong disagreement with the Court’s ruling is not
sufficient for there to be a ‘substantial ground for difference.’ ”).
C.

Whether Immediate Appeal May Materially Advance the Ultimate
Termination of the Litigation.

Finally, RJR contends that immediate appeal could effectively end this litigation,
since it is undisputed that plaintiffs did not redeem their C-Notes, and thus an appellate
determination that such redemption is required for acceptance of the offer would mandate
summary judgment in RJR’s favor. Mot. Cert. Appeal at 9.
“The key consideration for this factor is whether permitting an interlocutory appeal
would ‘minimiz[e] the total burdens of litigation on parties and the judicial system by
accelerating or at least simplifying trial court proceedings.’ ” Carrillo, 2014 WL
1155403, at *4 (quoting 16 Charles A. Wright & Arthur R. Miller, Fed. Practice & Proc.
§ 3930 (2d ed.)). As RJR recognizes, the final factor in section 1292(b) analysis “is
linked to whether an issue of law is ‘controlling.’ ” Ass'n of Irritated Residents v. Fred
Schakel Dairy, 634 F. Supp. 2d 1081, 1092 (E.D. Cal. 2008); Accord Rollins v. Dignity
Health, No. 13-CV-01450, 2014 WL 6693891, at *4 (N.D. Cal. Nov. 26, 2014) (“[T]he
considerations of this factor overlap significantly with the first one.”). Although the
question presented on appeal need not be dispositive of the entire action, “the appeal
must present a clear-cut question of law against a background of established facts.” Id.
(citing 9 Moore & B. Ward, Moore's Federal Practice ¶ 203.31[3] (2008)).
Here, the Court has already concluded that RJR’s proffered controlling question of
law is not the sort of question contemplated by section 1292(b), precisely because it does
not present a clear-cut question of law. Instead, the question reflects a disagreement with
the Court’s application of clear-cut law to the facts. Since RJR has not demonstrated that
its proffered question satisfies the first factor, it follows that RJR cannot satisfy the third
factor.1

1

In any event, the party pursuing the interlocutory appeal bears the burden of
demonstrating that all three requirements under section 1292(b) have been met. Couch,
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date

‘O’

Case No.

2:09-cv-08394-CAS(SSx)

June 17, 2015

Title

AMANDA SATERIALE ET AL. V. RJ REYNOLDS TOBACCO CO.

In summary, the Court is unpersuaded that the exceptional circumstances necessary
to certify an issue for interlocutory appeal under section 1292(b) are present in this case.
Accordingly, the Court DENIES RJR’s motion to certify the Court’s Summary
Judgement Order for interlocutory appeal.
IV.

CONCLUSION

In accordance with the forgoing, RJR’s motion to certify an interlocutory appeal is
DENIED.
IT IS SO ORDERED.
00
Initials of Preparer

:

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CMJ

611 F.3d at 633. The Court’s conclusion that RJR has failed to establish a controlling
issue of law is thus sufficient to deny the instant motion.
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