Mlejnecky v. Olympus Imaging America Inc.

Filing 34

ORDER granting in part and denying in part 17 Dendant's Motion to Dismiss, signed by Judge John A. Mendez on 4/18/11. Plaintiff shall file her second amended complaint within 20 days of the date of this Order.(Kastilahn, A)

1
2
3
4
5
6
7
8

UNITED STATES DISTRICT COURT

9

EASTERN DISTRICT OF CALIFORNIA

10
11

STEFANIE MLEJNECKY,

12

Plaintiff,

13

v.

14
15

OLYMPUS IMAGING AMERICA INC.,
Defendant.

16

)
)
)
)
)
)
)
)
)
)

Case No. 2:10-CV-02630 JAM-KJN
ORDER DENYING IN PART AND
GRANTING IN PART DEFENDANT‟S
MOTION TO DISMISS

17

This matter comes before the Court on Defendant Olympus

18

Imaging America Inc.‟s (“Defendant”) Motion to Dismiss (Doc.

19

#17) Plaintiff Stefanie Mlejnecky‟s (“Plaintiff”) First Amended

20

Complaint (“FAC”)(Doc. #16).

Plaintiff opposes the motion.1

21
I.

22

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiff purchased a new Stylus 1030 SW camera in July

23
24

2008 after viewing an advertisement in Parents Magazine.

The

25

advertisement stated that the cameras were “the world‟s toughest

26

digital cameras – waterproof to 33 feet [and] shockproof from

27
1

28

This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled
for February 23, 2011.
1

1

6.6 feet.

2

the advertisement in Parents Magazine, Plaintiff visited

3

Defendant‟s website, which allegedly contained the same

4

statements regarding the cameras.

5

and statements on Defendant‟s website, Plaintiff purchased the

6

Stylus 1030 SW. Plaintiff did not see a copy of the camera‟s

7

warranty or know its provisions until after she received the

8

camera and opened the package.

9

. . .”

FAC at 3:3-4.

In July 2008, after viewing

Based on the advertisement

On September 2, 2010, Plaintiff dropped her camera.

10

Plaintiff claims that although she dropped the camera from about

11

3 feet above the ground, the plastic latch for the battery/card

12

cover broke, preventing the cover from closing.

13

“card cover open” appeared, and the cover would not close,

14

making the camera inoperative.

15

Plaintiff called Defendant to report the camera‟s defect and

16

obtain repair or replacement of her camera.

17

representative informed her that she would have to pay around

18

$150 for repairs.

19

The message

Soon after the incident,

An Olympus

Plaintiff brings this lawsuit as a class action.

The

20

Complaint alleges five causes of action: 1) Violation of

21

California‟s Consumer Legal Remedies Act (“CLRA”), Cal. Civ.

22

Code section 1750 et seq.; (2) Unlawful business practices,

23

violation of California‟s Unfair Competition Law (“UCL”), Cal.

24

Bus. & Prof. Code section 17200, et seq.; (3) Unfair business

25

practices, violation of UCL; (4) Fraudulent business practices,

26

violation of UCL; and (5) False advertising, violation of UCL.

27

The Court has jurisdiction under 28 U.S.C. § 1332.

28
2

1
2

II.
A.

Legal Standard

3
4

OPINION

1.

Standing

The Article III case or controversy requirement limits

5

federal courts' subject matter jurisdiction by requiring that

6

plaintiffs have standing.

7

(1984).

8

bears the burden of proving its existence.

9

Life Insurance Co., 511 U.S. 375, 377 (1994).

Allen v. Wright, 468 U.S. 737, 750

The party asserting federal subject matter jurisdiction
Kokkonen v. Guardian
Standing

10

addresses whether the plaintiff is the proper party to bring the

11

matter to the court for adjudication.

12

Mutual Automobile Insurance Co., 598 F.3d 1115, 1122 (9th Cir.

13

2010).

14

matter jurisdiction, it is properly raised in a 12(b)(1) motion

15

to dismiss.

Because standing pertains to federal courts‟ subject

16
17

Chandler v. State Farm

2.

White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000).
Motion to Dismiss

A party may move to dismiss an action for failure to state

18

a claim upon which relief can be granted pursuant to Federal

19

Rules of Civil Procedure 12(b)(6).

20

dismiss, the court must accept the allegations in the complaint

21

as true and draw all reasonable inferences in favor of the

22

plaintiff.

23

overruled on other grounds by Davis v. Scherer, 468 U.S. 183

24

(1984); Cruz v. Beto, 405 U.S. 319, 322 (1972).

25

are mere “legal conclusions,” however, are not entitled to the

26

assumption of truth.

27

(2009), citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555

28

(2007).

In considering a motion to

Scheuer v. Rhodes, 416 U.S. 232, 236 (1975),

Assertions that

Ashcroft v. Iqbal, 129 S.Ct. 1937, 1950

To survive a motion to dismiss, a plaintiff needs to
3

1

plead “enough facts to state a claim to relief that is plausible

2

on its face.”

3

appropriate where the plaintiff fails to state a claim

4

supportable by a cognizable legal theory.

5

Pacifica Police Department, 901 F.2d 696, 699 (9th Cir. 1990).

6

Twombly, 550 U.S. at 570.

Dismissal is

Balistreri v.

Upon granting a motion to dismiss for failure to state a

7

claim, the court has discretion to allow leave to amend the

8

complaint pursuant to Federal Rules of Civil Procedure 15(a).

9

“Dismissal with prejudice and without leave to amend is not

10

appropriate unless it is clear . . . that the complaint could

11

not be saved by amendment.”

12

Inc., 316 F.3d 1048, 1052 (9th Cir. 2003).

13
14
15

B.

Eminence Capital, L.L.C. v. Aspeon,

Claims for Relief
1.

Injury Sufficient to Confer Standing

Defendant characterizes Plaintiff‟s lawsuit as a post-

16

warranty action and argues that she generally lacks standing

17

because her camera broke more than a year beyond the expiration

18

of the warranty and she does not allege that there was a safety

19

issue or a representation about the lifespan of the product that

20

would give her standing to assert a post-warranty claim.

21

Defendant further argues that the challenged representations

22

reiterate the terms of the express warranty, which warrants the

23

camera‟s ability to operate in water at depths of up to 10

24

meters and sustain accidental impact for one year.

25

also contends that in the absence of representations

26

contradicting the terms of the warranty, “the only expectation

27

buyers could have had about the [product] was that it would

28

function properly for the length of [the] express warranty, and
4

Defendant

1

it did.”

2

Cal.App.4th 824, 838 (Cal.App.Ct.2d 2006).

3

Plaintiff‟s lawsuit as a post-warranty action, Defendant argues

4

that Plaintiff‟s claims are barred because she has no standing

5

to assert an injury for a defect arising after the warranty

6

expired.

7

Daugherty v. American Honda Motor Co., Inc., 144
Thus, by framing

Plaintiff counters that this is not a post-warranty action,

8

but an affirmative misrepresentation lawsuit.

Plaintiff argues

9

that Defendant‟s representations that the Stylus SW cameras are

10

waterproof and shockproof are untrue and that Defendant‟s

11

failure to disclose the defects inherent in its Stylus SW

12

cameras run counter to those affirmative misrepresentations.

13

Plaintiff also avers that Defendant‟s express warranty excludes

14

defects and damage caused by shock and water exposure.

15

Plaintiff contends that Defendant cannot point to the expiration

16

of a warranty that never covered the defects in the first place

17

to insulate it from liability for fraudulent misrepresentations

18

regarding the cameras‟ characteristics.

19

Pneumatic Tool Co., 152 Cal.App.3d 951, 958 (Cal.App.Ct.4d 1984)

20

(finding that where a product has been described by its

21

manufacturer as having certain detailed capacities under certain

22

conditions, it would be both unfair and unreasonable to disclaim

23

those features in the express warranty); see also In re Toyota

24

Motor Corp., No. 8:10ML 021515, 2010 WL 4867562, *13 (C.D. Cal.

25

Nov. 30, 2010) (concluding warranty based defenses do not

26

preclude standing even if the warranty covered the defect in

27

question).

28

Thus,

See Fundin v. Chicago

Under California law, where a manufacturer of consumer
5

1

goods has warranted a product for a limited period, the

2

manufacturer is liable under the CLRA or UCL for failing to

3

disclose information about a defect that manifests itself

4

outside the express warranty period when (1) the omitted fact

5

runs counter to a representation made by the defendant, or

6

(2) the defendant had a duty to disclose the omitted

7

information.

8
9

Daughtery, 144 Cal.App.4th at 835.

The Court finds that Plaintiff‟s FAC asserts affirmative
misrepresentation claims, not a post-warranty case.

Unlike the

10

plaintiffs in Daugherty, the principle case upon which Defendant

11

relies, Plaintiff is not alleging a breach of an express

12

warranty or a violation of the Manuson-Moss Warranty-Federal

13

Trade Commission Improvement Act.

14

Daugherty are dissimilar to the facts in the instant case.

15

Daugherty, Plaintiffs alleged that Honda‟s F22 engine had a

16

defect which manifested after the express warranty expired.

17

Here, Plaintiff alleges that the defect is inherent in the

18

product.

19

summarizes and agrees with the holding of Outboard Marine Corp.

20

v. Superior Court, 52 Cal.App.3d 30 (Cal.App.Ct.3d 1975).

21

Outboard Marine, the plaintiff alleged that the defendant had

22

represented its off-road vehicles as able to climb very steep

23

hills, drive on the sides of hills, and safely descent very

24

steep grades.

25

plaintiff also alleged that defendant knew, but failed to

26

disclose, that the vehicle “would not operate within „its design

27

criteria,‟” “would roll over forward on a downgrade,” and that

28

“its braking system was totally defective.”

Additionally, the facts in
In

Finally, and most significantly, the Daugherty court

Outboard Marine, 52 Cal.App.3d at 34.

6

Id.

In

The

The Outboard

1

Marine court denied the defendant‟s motion to dismiss, holding

2

that the CLRA “includes a proscription against the concealment

3

of the characteristics, use, benefit, or quality of the goods

4

contrary to that represented.”

5

between this case, Outboard Marine, and Daughtery, is that in

6

the instant case and in Outboard Marine, plaintiffs allege a

7

concealment of characteristics or quality contrary to that

8

represented, but in Daugherty, no representation was made to

9

which the alleged concealment was contrary.

Id. at 37.

The difference

Daughtery, 144

10

Cal.App.4th at 834.

11

Plaintiff‟s case is based on an affirmative misrepresentation

12

theory, and not a post-warranty theory, Defendant‟s Motion to

13

Dismiss the entire FAC on general lack of standing grounds is

14

DENIED.

15

2.

Therefore, because the Court finds that

Standing Under the CLRA and UCL

16

In addition to its general lack of standing argument,

17

Defendant contends that Plaintiff lacks standing under the CLRA

18

and UCL on numerous grounds discussed below.

19

that she has sufficiently pled enough facts to give her

20

standing.

21
22

a)

Plaintiff responds

Injury In Fact

Defendant argues that Plaintiff has not alleged an injury

23

sufficient to confer standing under the UCL and CLRA.

Plaintiff

24

counters that she has standing based on Defendant‟s affirmative

25

misrepresentations.

26

To have standing under the UCL, as well as to serve as a

27

class representative, plaintiff must “(1) establish a loss or

28

deprivation of money or property sufficient to qualify as injury
7

1

in fact, i.e., economic injury, and (2) show that the economic

2

injury was the result of, i.e., caused by, the unfair business

3

practice or false advertising that is the gravamen of the

4

claim.”

5

2011 WL 240278, at *5 (Cal. Jan. 27, 2011).

6

Plaintiff must show a tangible increased cost or burden

7

resulting from an alleged unlawful practice.

8

§ 1780(a); Meyer v. Sprint Spectrum L.P., 45 Cal.4th 634, 643

9

(Cal. 2009) (holding that the CLRA only applies when an

Kwikset Corp. v. Superior Court, --- Cal. Rptr.3d ---,
Under the CLRA,

Cal. Civ. Code

10

allegedly unlawful practice results in a tangible increased cost

11

or burden to the consumer).

12

Plaintiff alleges that Defendant affirmatively represented

13

in advertisements and on its website that the Olympus Stylus SW

14

cameras were “waterproof to 33 feet” and “shockproof from 6.6

15

feet.”

FAC ¶ 8.

16

false.

FAC ¶ 3, 48, 62, 75, 88, 101-02.

17

saw the false statements in an advertisement and on Defendant‟s

18

website and she relied on those statements in purchasing her

19

Stylus 1030 SW camera.

20

purchased a Stylus SW camera had Defendant not made the

21

misrepresentations in its advertisements and on its website.

22

Id.

23

turned out not to be as advertised.

24

these allegations as true, as the Court must, the Court finds

25

that Plaintiff has properly alleged an injury, sufficient to

26

confer standing for the Stylus 1030 SW, under the UCL and CLRA.

Plaintiff alleges those representations are

FAC ¶ 8.

She alleges that she

She alleges she would not have

Finally, Plaintiff alleges she was damaged when the camera

27
28
8

Id.

Thus, taking all of

1

b)

2
3

Standing For a Product Plaintiff Did Not
Purchase

Plaintiff makes no allegations that she viewed any

4

advertisements for the Stylus 850 SW or that she ever owned such

5

a camera.

6

the Stylus 850 SW has the same underlying defects as the Stylus

7

1030 and Defendant used the same advertisement for all Stylus

8

cameras.

9

Instead, Plaintiff argues she has standing because

District courts in this circuit have split over whether a

10

named plaintiff has standing for a product she did not purchase.

11

Defendant relies on Johns v. Bayer Corp., No. 09-cv-1935, 2010

12

WL 476688, *4-5 (S.D.Cal. Feb. 9, 2010) which held that the

13

plaintiff lacked standing to sue for a vitamin product he did

14

not purchase, even though it contained the same alleged defect

15

and was part of the same uniform advertising campaign as the

16

vitamin product the plaintiff purchased.

17

that plaintiff “cannot expand the scope of his claims to include

18

a product he did not purchase or advertisements relating to a

19

product that he did not rely upon.”

20

relies on two cases, Carideo v. Dell, Inc., 706 F.Supp.2d 1122

21

(W.D. Wash. 2010) and Hewlett-Packard v. Superior Court, 167

22

Cal.App.4th 87 (Cal.App.Ct.6d 2008).

23

allowed the complaint to include computer models that the named

24

plaintiffs did not purchase, but for which the plaintiffs

25

pleaded the same core factual allegations and causes of actions

26

regarding the alleged defects in the computer models.

27

F.Supp.2d at 1134.

28

class action lawsuit to proceed past the class certification

The court reasoned

Johns at *5.

Plaintiff

In Carideo, the court

706

In Hewlett-Packard, the court allowed a

9

1

stage based on a common defect in the HP notebook computers and

2

their display screens where the named plaintiff had purchased

3

one of the many models at issue.

4

167 Cal.App.4th at 89-91.

The Court finds Johns to be more persuasive than those

5

cases relied upon by Plaintiff, because the Johns court‟s

6

reasoning is more in line with the recent standard delineated by

7

the California Supreme Court in Kwikset, 2011 WL 240278.

8

Kwikset, discussed supra, held that to have standing, a

9

plaintiff must allege an economic injury and must allege that

10

the economic injury was caused by Defendant‟s unfair business

11

practices.

12

not claim that she suffered any economic injury from any alleged

13

misrepresentations regarding the Stylus 850 SW.

14

the Court GRANTS, WITH LEAVE TO AMEND, Defendant‟s Motion to

15

Dismiss Plaintiff‟s claims concerning the Stylus 850 SW.

16
17

See Kwikset, 2011 WL 240278 at *5.

c)

Plaintiff does

Accordingly,

Defects Plaintiff Did Not Experience

Plaintiff asserts claims based on the purported shockproof

18

and waterproof features of the Stylus 1030 SW, despite making no

19

allegation that her camera suffered from any defects relating to

20

the waterproof feature.

21

Plaintiff relies on Falk v. General Motors Corp., 496

22

F.Supp.2d 1088 (N.D. Cal. 2007) to argue that the manner in

23

which a product defect manifests is not material to whether a

24

plaintiff may state a claim under the CLRA or UCL.

25

persuasive.

26

dismiss the CLRA and UCL claims based on defective speedometers

27

that manifest the defect in different ways for different

28

consumers, the named plaintiffs all alleged an injury stemming

Falk is not

While the court in Falk denied the motion to

10

1

from the defect.

In this case, Plaintiff has not alleged that

2

she was affected in any way by the alleged misrepresentation

3

that the Stylus 1030 SW is waterproof.

4

been subject to injurious conduct of one kind [does not] possess

5

by virtue of that injury the necessary stake in litigating

6

conduct of another kind, although similar, to which he has been

7

subject.”

8

Accordingly, Defendant‟s Motion to Dismiss Plaintiff‟s claims to

9

the extent they concern a defect she did not experience, i.e.

“[A] plaintiff who has

Blum v. Yaretsky, 457 U.S. 991, 999 (1982).

10

that the Stylus 1030 SW is not waterproof, is GRANTED WITH LEAVE

11

TO AMEND.

12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

d)

Advertising Plaintiff Did Not View

Plaintiff specifically identifies statements in the Parents
Magazine advertisement and on Defendant‟s website that she
relied on in purchasing her Stylus camera.

Defendant argues

that Plaintiff lacks standing for her broad challenge of
statements made in unspecified “marketing materials” and “other
places.”

FAC ¶¶ 24-25, 37.

The allegations concerning the

Parents Magazine advertisement and Defendant‟s website are
sufficient to confer Plaintiff‟s standing to challenge those
representations.

However, she cannot broaden her argument to

materials upon which she did not specifically rely.

See Durell

v. Sharp Healthcare, 183 Cal.App.4th 1350, 1363-64
(Cal.App.Ct.4d 2010) (dismissing claim after plaintiff failed to
allege that he relied on or viewed the website that he claimed
contained misrepresentations).

Since Plaintiff does not allege

a long-term advertising campaign or exposure to any other
advertisements, Plaintiff lacks standing to sue Defendant for
11

1

advertisements and statements other than those she saw and

2

relied upon.

3

(Cal. 2009) (holding that where plaintiffs have been exposed to

4

and had relied upon a long-term advertising campaign, they are

5

not required to specify with detail which of the particular

6

advertisements they relied upon).

7

that Plaintiff has standing to challenge only the

8

representations made in the advertisements Plaintiff saw in

9

Parents Magazine and on Defendant‟s website unless she can

See In re Tobacco II Cases, 46 Cal.4th 298, 328

Accordingly, the Court finds

10

allege that she was exposed to a long-term advertising campaign.

11

The Court GRANTS WITH LEAVE TO AMEND Defendant‟s Motion to

12

Dismiss the allegations found in ¶¶ 24, 25 and 37 of the FAC

13

concerning alleged statements made by Defendant in unspecified

14

“marketing materials” and “other places”.

15
16

3.

Claims Grounded in Fraud

Defendant argues that the FAC sounds in fraud and should be

17

dismissed because Plaintiff fails to plead fraud with the

18

particularity required by Rule 9(b) and Plaintiff fails to plead

19

falsity and a failure to disclose.

20

has alleged the fraud-based claims with specificity.

21

Plaintiff responds that she

When allegations of fraud are made, Rule 9(b) requires

22

plaintiffs to “state with particularity the circumstances

23

constituting fraud.

24

. . .”

FED.R.CIV.P. 9(b).

Rule 9(b) requires fraud claims to be “specific enough to

25

give defendants notice of the particular misconduct . . . so

26

that they can defend against the charge and not just deny that

27

they have done anything wrong.”

28

F.3d 1014, 1019 (9th Cir. 2001) (internal quotations omitted).

Bly-Magee v. California, 236

12

1

“Averments of fraud must be accompanied by the who, what, when,

2

where, and how of the misconduct charged.”

3

Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (internal

4

citations omitted).

5

alleged statements were false, but must specify how statements

6

were false when they were made.

7

Litigation, 42 F.3d 1541, 1548-49 (9th Cir. 1994) (en banc),

8

(superseded by statute on other grounds); Vess, 317 F.3d at

9

1106.

10

Vess v. Ciba-Geigy

Plaintiffs must not only specify how

In re Glenfed, Inc. Securities

Plaintiff does not dispute that Rule 9(b) applies to her

11

claims but argues that the FAC satisfies the heightened pleading

12

requirements for the fraud-based claims. Contrary to Defendant‟s

13

argument, the Court finds that the FAC repeatedly identifies

14

Defendant as responsible for the alleged misrepresentations, it

15

specifically identifies the substance of the alleged

16

misrepresentations, it includes the specific month and year the

17

alleged misrepresentations appeared in Parents Magazine and on

18

Defendant‟s website, and it describes how the alleged

19

misrepresentations are false.

20

are sufficiently specific to provide Defendant sufficient notice

21

against Plaintiff‟s charges.

22

Thus, the FAC‟s fraud allegations

Plaintiff alleges that Defendant knew of the falsity of its

23

alleged misrepresentations from the online reviews and

24

complaints from consumers.

25

be „relaxed as to matters peculiarly within the opposing party‟s

26

knowledge,‟ if the plaintiffs cannot be expected to have

27

personal knowledge of the facts prior to discovery.”

28

Gupta Corp. Securities Litigation, 900 F.Supp.1217, 1228 (N.D.

“The requirements of Rule 9(b) may

13

In re

1

Cal 1994), quoting Wool v. Tandem Computers Inc., 818 F.2d 1433,

2

1439 (9th Cir. 1987).

3

satisfied if the allegations are accompanied by a statement of

4

the facts upon which the belief is founded.”

5

1439.

6

which the belief is founded in the form of online reviews and

7

complaints from consumers.

8

sufficiently pleads that Defendant was aware that its Stylus

9

cameras were not as shockproof as advertised to survive the

10

“[T]he particularity requirements may be

Wool, 818 F.2d at

The FAC includes a detailed statement of the facts upon

Based on those reviews, Plaintiff

Motion to Dismiss.

11

Furthermore, because Plaintiff is alleging affirmative

12

material representations, she does not need to allege the useful

13

life of the product.

14

(citing Bardin v. DaimlerChrysler Corp., 136 Cal.App.4th 1255,

15

1275 (Cal.App.Ct.4d 2006).

16

Dismiss Plaintiff‟s FAC for failing to properly plead the

17

averments of fraud is DENIED.

18
19

4.

See Daugherty, 144 Cal.App.4th at 838

Accordingly, Defendant‟s Motion to

Unfair Business Practice

Defendant argues that Plaintiff‟s third claim for an

20

“unfair business practice” under the UCL fails because Plaintiff

21

does not tether her claims to any legislatively-declared public

22

policy.

23

apply to claims brought by consumers alleging misleading

24

advertising.

25

sufficiently alleges an “unfair” claim under the UCL.

Plaintiff responds that the tethering test does not

In the alternative, she argues that she

26

In Cel-Tech Communications, Inc. v. L.A. Cellular Telephone

27

Co., 20 Cal.4th 163, 180-81, (Cal. 1999), the California Supreme

28

Court ruled that conduct is “unfair” between business
14

1

competitors under the UCL only if it is “tethered” to an

2

underlying law.

3

Supreme Court limited the context of its ruling by specifying

4

that “[n]othing we say relates to actions by consumers or by

5

competitors alleging other kinds of violations of the unfair

6

competition law such as . . . untrue or misleading advertising.”

7

Id. at 187 n. 12.

8

allegations of unfair practices as applied to consumers,

9

however, is not settled.

Cel-Tech, 20 Cal.4th at 186-87.

The California

Whether the tethering test is applicable to

California appellate courts have split

10

on whether to apply the tethering test or an older balancing

11

test to consumers alleging unfair business practices.

12

Gregory v. Albertson's, Inc., 104 Cal.App.4th 845, 854, 389

13

(Cal. App. Ct. 1d 2002) (applying tethering test to consumers);

14

and Scripps Clinic v. Superior Court, 108 Cal.App.4th 917, 938

15

(Cal.App.Ct.4d 2003) (same); with Smith v. State Farm Mutual

16

Automobile Insurance Co., 93 Cal.App.4th 700, 718-19

17

(Cal.App.Ct. 2d 2001) (applying balancing test).

18

Circuit has not stated its preference.

19

Wireless Services, Inc., 504 F.3d 718, 737 (9th Cir. 2007)

20

(holding that the tethering test and the balancing test are not

21

mutually exclusive and upholding the district court‟s

22

application of the balancing test).

23

Compare

The Ninth

See Lozano v. AT&T

The Court finds that the application of the balancing test

24

to the case at bar is appropriate.

This case involves a

25

consumer alleging misrepresentation and the California Supreme

26

Court specified that its holding does not apply to misleading

27

advertisements.

28

and practices cause injuries to consumers, which outweigh their

Plaintiff‟s allegation that Defendant‟s acts

15

1

benefits, combined with the specific descriptions of harm faced

2

by Plaintiff, is sufficient to survive a motion to dismiss.

3

Furthermore, even if the Court were to find that tethering to

4

public policy were required, Plaintiff adequately alleges

5

tethering by stating that Defendant‟s unfair business acts or

6

practices violate established public policy reflected in the UCL

7

and CLRA, including but not limited to California Civil Code

8

sections 1770(a)(5) and 1770(a)(7) and California Business and

9

Professions Code section 175000.

10

Accordingly, Defendant‟s

Motion to Dismiss the “unfair” claim (claim 3) is DENIED.

11
12

III. ORDER

13

For the reasons set forth above,

14

Defendant‟s Motion to Dismiss the FAC for a generalized

15
16

lack of standing is DENIED.
Defendant‟s Motion to Dismiss Plaintiff‟s FAC in so far as

17

it concerns the Stylus 1030 SW and its shockproof features is

18

DENIED.

19

Defendant‟s Motion to Dismiss Plaintiff‟s FAC in so far as

20

it concerns the Stylus 850 SW, any waterproof defects of any

21

camera, and any advertisements upon which Plaintiff did not

22

specifically rely is GRANTED WITH LEAVE TO AMEND.

23
24
25

Defendant‟s Motion to Dismiss Plaintiff‟s FAC for failing
to plead her fraud-based claims with specificity is DENIED.
Defendant‟s Motion to Dismiss Plaintiff‟s FAC for failing

26

to allege facts supporting the elements of her “unfair” business

27

claim is DENIED.

28

Plaintiff shall file her Second Amended Complaint within
16

1
2

twenty (20) days of the date of this Order.
IT IS SO ORDERED.

3
4

Dated: April 18, 2011

____________________________
JOHN A. MENDEZ,
UNITED STATES DISTRICT JUDGE

5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
17