Circle Click Media LLC v. Regus Management Group LLC et al

Filing 59

ORDER by Judge Samuel Conti denying without prejudice #29 motion to dismiss for lack of personal jurisdiction; granting in part and denying in part #31 motion to dismiss for failure to state a claim. (sclc1, COURT STAFF) (Filed on 1/3/2013)

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1 2 3 4 IN THE UNITED STATES DISTRICT COURT 5 FOR THE NORTHERN DISTRICT OF CALIFORNIA 6 7 8 9 For the Northern District of California United States District Court 10 11 12 13 14 15 CIRCLE CLICK MEDIA LLC, METRO TALENT, LLC, CTNY INSURANCE GROUP LLC, on behalf of themselves and all others similarly situated, ) ) ) ) ) Plaintiffs, ) ) v. ) ) REGUS MANAGEMENT GROUP LLC, REGUS ) BUSINESS CENTRE LLC, REGUS PLC, HQ ) GLOBAL WORKPLACES LLC, and DOES 1 ) through 50, ) ) Defendants. ) ) Case No. 12-04000 SC ORDER RE: (1) REGUS PLC'S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION AND (2) DEFENDANTS' MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM 16 17 I. INTRODUCTION 18 Plaintiffs Circle Click Media LLC ("Circle Click"), Metro 19 Talent, LLC ("Metro Talent"), and CTNY Insurance Group LLC ("CTNY") 20 (collectively, "Plaintiffs") bring this putative class action 21 against Regus Management Group LLC ("RMG"), Regus Business Centre 22 LLC ("RBC"), Regus plc, and HQ Global Workplaces LLC ("HQ Global") 23 (collectively "Defendants"). 24 ("FAC")). 25 dismiss for lack of personal jurisdiction pursuant to Federal Rule 26 of Civil Procedure 12(b)(1); and (2) Defendants' motion to dismiss 27 for failure to state a claim pursuant to Federal Rule of Civil 28 Procedure 12(b)(6). ECF No. 24 (First Amended Complaint Now before the Court is: (1) Regus plc's motion to ECF Nos. 29 ("12(b)(1) MTD"); 31 ("12(b)(6) The motions are fully briefed1 and appropriate for 1 MTD"). 2 resolution without oral argument. 3 Regus plc's 12(b)(1) motion is DENIED WITHOUT PREJUDICE pending 4 jurisdictional discovery by Plaintiffs. 5 12(b)(6) motion is GRANTED in part and DENIED in part. For the reasons set forth below, Further, Defendants' 6 7 II. The following facts are taken from Plaintiffs' FAC. 8 9 BACKGROUND Defendants are in the business of leasing commercial office space United States District Court For the Northern District of California 10 throughout California and New York. FAC ¶ 1. 11 is a foreign public limited company incorporated and registered in 12 Jersey, Channel Islands, and is the parent company of Defendants 13 RMG, RBC, and HQ Global. 14 four defendants are alter egos of each other and generally do not 15 distinguish between them in the FAC. Id. ¶¶ 1, 14. Defendant Regus plc Plaintiffs allege that all See id. ¶¶ 1, 21 In 2011, Plaintiffs entered into identical office agreements 16 17 with Defendants (collectively, the "Office Agreement(s)") for 18 commercial office space in California and New York. 19 65. 20 over the monthly payments indicated by their agreements. 21 For example, Plaintiffs allege that Defendants routinely assessed 22 Circle Click for charges relating to kitchen amenities, various 23 telecommunication services, "business continuity service," taxes, 24 and penalties -- fees which were not disclosed in the Office 25 Agreement or the fine print and which bore no reasonable Id. ¶¶ 43, 52, Plaintiffs allege they were assessed charges by Defendants Id. ¶ 71. 26 1 27 28 ECF Nos. 39 ("Opp'n to 12(b)(6) MTD"); 40 ("Opp'n to 12(b)(1) MTD"), 44 ("Reply ISO 12(b)(1) MTD"), 45 ("Reply ISO 12(b)(6) MTD"). The Court reminds Plaintiffs that Civil Local Rule 7-4 requires parties to include a table of contents and a table of authorities in all briefs exceeding ten pages. 2 1 relationship to the services purportedly rendered by Defendants. 2 Id. ¶ 48. 3 Plaintiffs allege that, in light of Defendants' billing 4 practices, its advertising is false and misleading. See id. ¶ 73. 5 Plaintiffs specifically point to advertisements posted to 6 Defendants' website from 2003 through 2012. 7 represented that customers "could save up to 78 % [sic] compared to 8 traditional office costs," that Defendants' one-page contract 9 "takes just 10 minutes to complete," and that Defendants' services These advertisements United States District Court For the Northern District of California 10 were "[s]imple, easy[,] and flexible." 11 also point to a broadcast commercial by Defendants, wherein an 12 actress states: 13 14 15 16 Id. ¶¶ 23-31. Plaintiffs I don't have a lease so I don't have to budget for stuff like phones, IT guys, and artwork for the lobby. Instead, I pay one low monthly rate that gives me a beautiful lobby that impresses my clients, a friendly receptionist, a fully furnished office, a place to meet, and a place to brainstorm with my fellow new way workers. We wonder why more people don't realize that the new way to work is the best way to work. 17 18 19 Id. ¶ 31. Plaintiffs filed the instant action in state court in May 2012 20 and Defendants subsequently removed. 21 which was filed after removal, Plaintiffs seek to represent a class 22 of all persons who paid for Defendants' office space in California 23 and New York and were assessed charges by Defendants over the 24 monthly payments indicated in the Office Agreement or any similar 25 agreement. 26 the California class, which is represented by Circle Click and 27 Metro Talent: (1) violation of California Business and Professions 28 Code section 17200 (the California Unfair Competition Law ("UCL")); FAC ¶ 71. ECF No. 1. In their FAC, Plaintiffs assert six counts on behalf of 3 1 (2) violation of California Business and Professions Code section 2 17500 (the California False Advertising Law ("FAL"); (3) 3 "concealment/suppression"; (4) & (5) negligent and intentional 4 misrepresentation; and (6) unjust enrichment. 5 assert the following claims on behalf of the New York class, which 6 is represented by CTNY: (7) & (8) violation of New York State 7 General Business Law ("NYSGBL") sections 349 and 350; and (9) 8 unjust enrichment. 9 obtained revenues, injunctive relief, and special and general United States District Court For the Northern District of California 10 Plaintiffs also Plaintiffs seek restitution of wrongfully damages, among other things. 11 12 III. DISCUSSION 13 A. Regus plc's 12(b)(1) Motion 14 Regus plc argues that it should be dismissed from this suit 15 because it is a foreign entity that operates outside of California. 16 12(b)(1) MTD at 4. 17 specific jurisdiction is proper due to Regus plc's false 18 advertising in California and that the other Defendants' contacts 19 with California can be imputed to Regus plc under an agency and 20 alter ego analysis. 21 also argue that, if the Court finds that Plaintiffs have failed to 22 make a sufficient showing on these claims, it should grant 23 Plaintiffs an opportunity to take jurisdictional discovery. 24 16. 25 26 i. Plaintiffs respond that the exercise of Opp'n to 12(b)(1) MTD at 9-15. Plaintiffs Id. at Legal Standard Plaintiffs bear the burden of showing that the Court has 27 personal jurisdiction over Regus plc. 28 Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006). 4 See Pebble Beach Co. v. "[T]his demonstration 1 requires that the plaintiff make only a prima facie showing of 2 jurisdictional facts to withstand the motion to dismiss." 3 (quotations omitted). 4 favor of the plaintiff . . . ." 5 plaintiff cannot simply rest on the bare allegations of its 6 complaint, but uncontroverted allegations in the complaint must be 7 taken as true." 8 1218, 1223 (9th Cir. 2011) (quotations omitted). 9 California's long-arm statute is coextensive with federal due Id. "[T]he court resolves all disputed facts in Id. (quotations omitted). "The Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d Since United States District Court For the Northern District of California 10 process requirements, Cal. Civ. Proc. Code § 410.10, the personal 11 jurisdiction analysis under state and federal law are the same. 12 13 14 15 16 17 18 19 20 21 22 ii. Specific Jurisdiction The Ninth Circuit has established a three-prong analysis for assessing claims of specific jurisdiction: (1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable. 23 Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th 24 Cir. 2004). 25 two prongs and, if it does, the burden then shifts to the defendant 26 to show why the exercise of personal jurisdiction would be 27 unreasonable. 28 The plaintiff bears the burden of satisfying the first Id. As to the first prong, the parties agree that the Court should 5 1 apply the purposeful direction analysis enunciated by the Supreme 2 Court in Calder v. Jones, 465 U.S. 783 (1984). 3 Opp'n to 12(b)(1) MTD at 10. 4 must have (1) committed an intentional act, which was (2) expressly 5 aimed at the forum state, and (3) caused harm, the brunt of which 6 is suffered and which the defendant knows is likely to be suffered 7 in the forum state." 8 Calder, 465 U.S. at 783). 12(b)(1) MTD at 7, "To satisfy this test the defendant Pebble Beach, 453 F.3d at 1156 (citing Plaintiffs argue that the "expressly aimed" condition is met 9 United States District Court For the Northern District of California 10 here because of Defendants' website, regus.com. Opp'n to 12(b)(1) 11 MTD at 10. 12 jurisdiction where "a website advertiser [does] nothing other than 13 register a domain name and post an essentially passive website." 14 Pebble Beach, 453 F.3d at 1157 (quotations omitted). 15 hand, personal jurisdiction may be appropriate where the defendant 16 operates an interactive website, depending on the "level of 17 interactivity and commercial nature of the exchange of information 18 that occurs on the Web site." 19 130 F.3d 414, 418 (9th Cir. 1997). The Ninth Circuit has held that there is no personal On the other Cybersell, Inc. v. Cybersell, Inc., Plaintiffs contend that regus.com is highly interactive and 20 21 designed to target California consumers. Opp'n to 12(b)(1) MTD at 22 10. 23 directories for thirty-six California cities and counties. 24 10-11. 25 website interface with RMG, not Regus plc. 26 Defendants rely on the declaration of Tim Regan, the company 27 secretary for Regus plc., who declares: "Communications and 28 business that are completed on the www.regus.com website by They point out that the website includes sub-domain Id. at Defendants counter that the interactive features on the 6 12(b)(1) MTD at 8. 1 California customers occur with [RMG]. 2 this website and the contact information on this website direct the 3 California customer to [RMG]." 4 Since the Regan Declaration controverts the FAC, the Court must 5 look past its bare allegations of purposeful direction.2 6 regus.com website cannot support a finding of purposeful direction 7 or the exercise of personal jurisdiction. ECF No. 30 ("Regan Decl.") ¶ 18. Thus, the Neither can the "unsolicited email" produced by Plaintiffs. 8 9 The interactive features on ECF No. 41 ("Ward Decl.") Ex. B. The email is a general United States District Court For the Northern District of California 10 advertisement from "Regus@regus-woldwide.com" which was sent to 11 "award@circleclick.com" on May 25, 2012. 12 of the email refers to Regus plc and its registered office in the 13 Channel Islands. 14 reference to California, does not demonstrate that Regus plc 15 expressly aimed its activities at California. Id. Id. The signature line This general advertisement, which makes no Further, Plaintiffs' 16 2 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs object to the Regan Declaration on a number of grounds. First, they argue that Mr. Regan lacks the requisite personal knowledge and that his declaration is based on hearsay. Opp'n to 12(b)(1) MTD at 5. Plaintiffs point to the first paragraph of the declaration, in which Mr. Regan states: "The following facts are based upon my personal knowledge or are based upon information received from persons upon whom I rely in the normal course of business and/or the business records of Regus plc." Id. (quoting Regan Decl. ¶ 1). Contrary to Plaintiffs' contention, Mr. Regan does not lack the requisite personal knowledge merely because he may have reached an understanding about some of Regus plc's operations based on his review of business records or information gathered from staff. See Great Am. Assur. Co. v. Liberty Surplus Ins. Corp., 669 F. Supp. 2d 1084, 1089 (N.D. Cal. 2009) ("Personal knowledge includes opinions and inferences grounded in observations and experience."). Further, Mr. Regan's declaration is not hearsay because it is based on Mr. Regan's own understanding and observations and contains no out-of-court statements. Plaintiffs also object to Mr. Regan's statements concerning regus.com on the ground that they are vague and ambiguous and constitute inadmissible legal conclusions because they interpret the legal significance of online interaction through the Regus website. Opp'n to 12(b)(1) MTD at 8. This argument is unavailing. The paragraphs targeted by Plaintiffs contain straightforward statements of fact, not legal conclusions. 7 1 injuries could not be related to this email since it was sent after 2 Plaintiffs filed the instant action. 3 Accordingly, the Court finds that Plaintiffs have failed to 4 meet their burden of showing that the exercise of specific 5 jurisdiction would be appropriate. iii. Agency and Alter Ego Analysis 6 7 Generally, the existence of a parent-subsidiary relationship 8 "is not sufficient to establish personal jurisdiction over the 9 parent on the basis of the subsidiaries' minimum contacts with the United States District Court For the Northern District of California 10 forum." Doe v. Unocal Corp., 248 F.3d 915, 925 (9th Cir. 2001). 11 However, "if the parent and subsidiary are not really separate 12 entities [i.e., alter egos], or one acts as an agent of the other, 13 the local subsidiary's contacts with the forum may be imputed to 14 the foreign parent corporation." Id. at 926 (quotations omitted). 15 To satisfy the alter ego exception to the general rule, "the 16 plaintiff must make out a prima facie case (1) that there is such 17 unity of interest and ownership that the separate personalities [of 18 the two entities] no longer exist and (2) that failure to disregard 19 [their separate identities] would result in fraud or injustice." 20 Id. (quotations omitted). 21 subsidiary functions as the parent corporation's representative in 22 that it performs services that are sufficiently important to the 23 foreign corporation that if it did not have a representative to 24 perform them, the corporation's own officials would undertake to 25 perform substantially similar services." 26 omitted). 27 28 The agency exception applies where "the Id. at 928 (quotations The Court finds that Plaintiffs have proffered insufficient facts to support the application of either exception here. 8 1 Plaintiffs argue that the exceptions apply because Regus plc, RMG, 2 and RBC share a website, trademark, and logo. 3 12(b)(1) MTD at 14-15. 4 suggest that those facts are sufficient to attribute RMG and RBC 5 contacts to Regus plc. 6 plc uses the other Defendants as marketing conduits; however, it 7 offers no other facts concerning the connection between these 8 different entities. 9 exerts over the other Defendants or whether they share revenues, See Opp'n to However, they cite no authority which would Plaintiffs also baldly assert that Regus It is unclear how much control Regus plc United States District Court For the Northern District of California 10 customers, or staff. 11 with any evidence concerning the functional relationship between 12 Defendants. 13 14 15 16 In short, Plaintiffs have yet to come forward Accordingly, the Court declines to impute RMG and RBC's contacts with California to Regus plc at this time. iv. Jurisdictional Discovery The district court has discretion to allow a plaintiff to 17 conduct jurisdictional discovery. Wells Fargo & Co. v. Wells Fargo 18 Exp. Co., 556 F.2d 406, 430 n.24 (9th Cir. 1977). 19 such discovery should ordinarily be granted "where pertinent facts 20 bearing on the question of jurisdiction are controverted . . . or 21 where a more satisfactory showing of the facts is necessary." 22 (quotations omitted). 23 discovery "[w]here a plaintiff's claim of personal jurisdiction 24 appears to be both attenuated and based on bare allegations in the 25 face of specific denials made by the defendants . . . ." 26 Beach, 453 F.3d at 1160 (quotations omitted). The Court finds that 27 jurisdictional discovery is appropriate here. Defendants argue 28 that Plaintiffs have failed to substantiate their agency and alter Requests for Id. However, a district court need not permit 9 Pebble 1 ego theories, but they have not denied Plaintiffs' allegations. 2 See Reply ISO 12(b)(1) MTD. 3 additional evidence pertinent to the assessment of personal 4 jurisdiction. 5 Accordingly, discovery may uncover For the foregoing reasons, the Court DENIES Regus Plc's motion 6 to dismiss for lack of personal jurisdiction WITHOUT PREJUDICE and 7 GRANTS Plaintiffs leave to conduct jurisdictional discovery to 8 collect evidence relevant to their alter ego and agency theories of 9 personal jurisdiction. After discovery has been completed, Regus United States District Court For the Northern District of California 10 plc may again move to dismiss for lack of personal jurisdiction 11 pursuant to Federal Rule of Civil Procedure 12(b)(1). 12 B. i. 13 14 Defendants' Rule 12(b)(6) Motion Legal Standard A motion to dismiss under Federal Rule of Civil Procedure 15 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. 16 Block, 250 F.3d 729, 732 (9th Cir. 2001). 17 on the lack of a cognizable legal theory or the absence of 18 sufficient facts alleged under a cognizable legal theory." 19 Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 20 1988). 21 should assume their veracity and then determine whether they 22 plausibly give rise to an entitlement to relief." 23 Iqbal, 556 U.S. 662, 664 (2009). 24 must accept as true all of the allegations contained in a complaint 25 is inapplicable to legal conclusions. 26 elements of a cause of action, supported by mere conclusory 27 statements, do not suffice." 28 v. Twombly, 550 U.S. 544, 555 (2007)). "Dismissal can be based "When there are well-pleaded factual allegations, a court Ashcroft v. However, "the tenet that a court Threadbare recitals of the Id. at 663. (citing Bell Atl. Corp. 10 The allegations made in a 1 complaint must be both "sufficiently detailed to give fair notice 2 to the opposing party of the nature of the claim so that the party 3 may effectively defend against it" and "sufficiently plausible" 4 such that "it is not unfair to require the opposing party to be 5 subjected to the expense of discovery." 6 1191, 1204 (9th Cir. 2011). 7 8 ii. Starr v. Baca, 633 F.3d Group Pleading Defendants first argue that RBC, Regus plc, and HQ Global United States District Court should be dismissed from the case since Plaintiffs fail to allege 10 For the Northern District of California 9 any facts indicating that they had any involvement in the matters 11 that form the basis of Plaintiffs' claims. 12 Relying on Swartz v. KPMG LLP, 476 F.3d 756 (9th Cir. 2007), 13 Defendants contend that Plaintiffs have engaged in impermissible 14 group pleading. 15 the context of a fraud suit involving multiple defendants, a 16 plaintiff must, at a minimum, 'identif[y] the role of [each] 17 defendant[] in the alleged fraudulent scheme.'" 18 (quotations omitted) (alterations in the original). 19 argue that, although the FAC names four distinct defendants, it 20 makes no effort to articulate each defendant's role in the supposed 21 fraud, misrepresentations, or concealment. 22 Id. 12(b)(6) MTD at 7. In Swartz, the Ninth Circuit held that "[i]n The Court is not persuaded. 476 F.3d at 765 Defendants 12(b)(6) MTD at 7. As an initial matter, the 23 prohibition against group pleading only applies in cases of fraud, 24 see Swartz 476 F.3d at 765, and, in this case, only a fraction of 25 Plaintiffs' claims sound in fraud. 26 Rule of Civil Procedure 8 also bars Plaintiffs' claims, since it 27 requires Plaintiffs to set forth which claims are alleged against 28 which defendants. Defendants argue that Federal Reply ISO 12(b)(6) MTD at 3. 11 However, Rule 8 1 pleading standards do not prevent a plaintiff from "pleading facts 2 alleged upon information and belief where the facts are peculiarly 3 within the possession and control of the defendant . . . ." 4 Records, LLC v. Doe 3, 604 F.3d 110, 120 (2d Cir. 2010) (quotations 5 omitted). 6 information and belief, that Defendants are alter egos of each 7 other. 8 relationships is in the sole possession of Defendants, Plaintiffs 9 are entitled to discovery on the matter. Such is the case here. FAC ¶ 21. Arista Plaintiffs have pled, upon As information concerning Defendants' corporate This same reasoning United States District Court For the Northern District of California 10 applies to Plaintiffs' fraud claims. See Moore v. Kayport Package 11 Exp., Inc., 885 F.2d 531, 540 (9th Cir. 1989) ("Instances of 12 corporate fraud may also make it difficult to attribute particular 13 fraudulent conduct to each defendant as an individual."). Defendants argue that Plaintiffs have failed to plead 14 15 sufficient facts to support their alter ego allegations. 16 4. 17 make[] no distinction between entities when using the Regus logo in 18 connection with marketing," that "[Defendants] describe[] [their] 19 own operations to actual tenants as if such operations are 20 conducted by a single entity," and that "[Defendants] represent[] 21 to [their] investors [that they are] a unified entity," among other 22 things. 23 altogether. 24 allegation that Regus Management Group LLC, Regus Business Centre 25 LLC, Regus plc, and HQ Global are alter egos of one another. 26 iii. Count I: UCL Claims for Unlawful, Unfair, and 27 28 The Court disagrees. FAC ¶ 21. Reply at Plaintiffs allege that "[Defendants] Defendants appear to ignore these allegations In sum, the Court finds plausible Plaintiffs' Fraudulent Business Practices Plaintiffs' first claim for relief is brought under the 12 1 California UCL, which prohibits business practices that are (1) 2 unlawful, (2) unfair, or (3) fraudulent. 3 17200. 4 UCL. 5 predicate violations of sections 1950.8, 1671(b), 1572, 1709, and 6 1710 of the California Civil Code. 7 unfairness prong of the UCL, Plaintiffs target Defendants' alleged 8 practice of "assessing charges above the monthly payment indicated 9 in the Office Agreement." Cal. Bus. Prof. Code § Plaintiffs allege violations of all three prongs of the With respect to the unlawful prong, Plaintiffs allege FAC ¶¶ 85-87. Id. ¶ 84. As to the Finally, with respect to United States District Court For the Northern District of California 10 fraud, Plaintiffs allege that "Defendants' . . . failure to clearly 11 and conspicuously disclose [their] scheme, practice, and intent to 12 assess additional undisclosed fees deceives consumers, customers, 13 and/or the public."3 14 Plaintiffs' claims under all three prongs of the UCL. Id. ¶ 89. Unlawful Practices. 15 Defendants move to dismiss Defendants argue that Plaintiffs cannot 16 state a claim for unlawful practices under the UCL because they 17 have not alleged facts establishing predicate violations of the 18 borrowed statutes, California Civil Code sections 1950.8, 1671(b), 19 1572, 1709, and 1710. 12(b)(6) MTD at 17-19. Civil Code section 1950.8 "applies only to commercial leases 20 21 and nonresidential tenancies of real property" and makes it 22 unlawful to require payment "as a condition of initiating, 23 continuing, or renewing a lease or rental agreement, unless the 24 amount of payment is stated in the written lease or rental 25 agreement." Cal. Civ. Code § 1950.8(a)-(b). Plaintiffs allege 26 3 27 28 Plaintiffs also allege that Defendants are liable for fraud under the UCL because they engaged in false advertising. FAC ¶ 88. This UCL claim is identical to Plaintiffs' FAL claim. Compare id. ¶ 88 with id. ¶ 92. Accordingly, it is addressed in Section III.B.iv infra. 13 1 that Defendants violated section 1950.8 by "requir[ing] the payment 2 of monies as a condition of continuing the lease without providing 3 for the amounts of said monies in the Office Agreement or Fine 4 Print[.]" 5 inapplicable here because the Office Agreement executed by 6 Plaintiffs is not a lease. 7 Agreement provides: 8 10 United States District Court Defendants argue that section 1950.8 is 12(b)(6) MTD at 17-18. The Office This agreement is the commercial equivalent of an agreement for accommodation(s) in a hotel. The whole of the Center remains in Regus' possession and control. THE CLIENT ACCEPTS THAT THIS AGREEMENT CREATES NO TENANCY INTEREST, LEASEHOLD ESTATE, OR OTHER REAL PROPERTY INTEREST IN THE CLENT'S FAVOUR WITH RESPECT TO THE ACCOMODATIONS. 9 For the Northern District of California FAC ¶ 85. 11 12 ECF No. 34 Ex. B ("Office Agreement") § 1.1. Plaintiffs respond 13 that the Office Agreement shares all the characteristics of a lease 14 since it "grants Plaintiffs the right to enter and possess the 15 designated premises for a fixed consideration (one monthly fee) and 16 period of time (duration of months)." 17 The Court may not accept Plaintiffs' argument without ignoring the 18 express terms of the Office Agreement. 19 contention, the Office Agreement did not grant them the right to 20 possess the premises. 21 "remains in Regus' possession and control[.]" 22 1.1. 23 "CREATES NO TENANCY INTERST." 24 claim is DISMISSED WITH PREJUDICE as it pertains to California 25 Civil Code section 1950.8. Opp'n to 12(b)(6) MTD at 21. Contrary to Plaintiffs' In fact, it expressly states the property Office Agreement § Moreover, the Office Agreement expressly provides that it Id. Accordingly, Plaintiffs' UCL 26 Section 1671(b) states: "[A] provision in a contract 27 liquidating the damages for the breach of the contract is valid 28 unless the party seeking to invalidate the provision establishes 14 1 that the provision was unreasonable under the circumstances 2 existing at the time the contract was made." 3 1671(b). 4 section 1671(b) by "charging penalties based on a percentage of the 5 entire alleged unpaid principal balance, plus a fixed fee" since 6 such penalties "do[] not bear a reasonable nexus to the amount of 7 damages suffered by Regus." 8 Plaintiffs lack standing to bring this claim since they have not 9 alleged that they paid such a penalty or the amount of the penalty. Cal. Civ. Code § Plaintiffs allege that Defendants violated FAC ¶ 86. Defendants argue that United States District Court For the Northern District of California 10 12(b)(6) MTD at 18. Defendants misconstrue the FAC. 11 pleading could be clearer, Plaintiffs appear to be referring to the 12 penalty allegedly assessed against Circle Click which amounted to 13 "$25 plus 5% of the amount due on the overdue balances under $1,000 14 or $50 plus 5% of the amount due on the overdue balances of $1000 15 or greater." 16 paid the penalty. 17 Plaintiff Circle Click to suffer harm in the amount of the unfair 18 and unreasonable fees paid by Circle Click to Regus."). 19 Accordingly, Plaintiffs' UCL unlawfulness claim remains undisturbed 20 as to the alleged predicate violation of section 1671(b). FAC ¶ 48(l). While the Moreover, Plaintiffs allege that they Id. ¶ 51 ("Regus'[s] charges have caused 21 Plaintiffs claim that Defendants violated Civil Code sections 22 1572, 1709, and 1710 by routinely assessing charges not adequately 23 disclosed or indicated in the Office Agreement. 24 Sections 1572 and 1710 define the terms "actual fraud" and 25 "deceit," respectively, and section 1709 provides: "One who 26 willfully deceives another with intent to induce him to alter his 27 position to his injury or risk, is liable for any damage which he 28 thereby suffers." Id. ¶ 87. These claims fail for the same reasons as 15 1 Plaintiffs' claims for "concealment/suppression" and negligent and 2 intentional misrepresentation. 3 Accordingly, Plaintiffs UCL unlawfulness claim is DISMISSED with 4 leave to amend to the extent that it is predicated on violations of 5 Civil Code sections 1572, 1709, 1710. Unfair Practices. 6 See Section III.B.v infra. California courts have enunciated multiple 7 standards for evaluating a claim for unfair practices under the 8 UCL. 9 Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone In this case, the parties point to the tests set forth in United States District Court For the Northern District of California 10 Co., 20 Cal. 4th 163 (1999) and Camacho v. Automobile Club of 11 Southern California, 142 Cal. App. 4th 1394, 1401 (2006). 12 the Cel-Tech standard, an unfair business practice is "conduct that 13 threatens an incipient violation of an antitrust law, or violates 14 the policy or spirit of one of those laws because its effects are 15 comparable to or the same as a violation of the law, or otherwise 16 significantly threatens or harms competition." 17 Under the Camacho standard, a plaintiff may establish unfairness by 18 showing that the consumer injury (1) is substantial; (2) not 19 outweighed by any countervailing benefits to consumers or 20 competition; and (3) is one that consumers themselves could not 21 reasonably have avoided. 22 Under 20 Cal. 4th at 187. 142 Cal. App. 4th at 1403. Plaintiffs have failed to meet either standard. With respect 23 to the Cel-Tech standard, Plaintiffs have not attempted to identify 24 any law or public policy which might be offended by Defendants' 25 alleged conduct. 26 that Defendants' "systematic practice of non-disclosure" does not 27 serve any legitimate business purpose of utility. 28 12(b)(6) MTD at 23. As to the Camacho standard, Plaintiffs assert Opp'n to However, they have not explained why their 16 1 alleged injury is substantial or why they could not have avoided 2 the injury themselves. 3 appears that the fees about which Plaintiffs complain were in fact 4 disclosed in the Office Agreement and other documentation provided 5 by Defendants. 6 7 8 9 As set forth in Section III.B.v infra, it Accordingly, Plaintiffs' claim for unfair business practices under the UCL is DISMISSED with leave to amend. Fraudulent Practices. Plaintiffs' claim for fraudulent practices under the UCL fails for the same reasons as their claims United States District Court For the Northern District of California 10 for "concealment/suppression" and intentional and negligent 11 misrepresentation: the Office Agreement disclosed the fees that 12 Defendants allegedly concealed. 13 Plaintiffs point out, "[u]nlike a common law fraud claim, a UCL 14 fraud claim requires no proof that the plaintiff was actually 15 deceived. 16 likelihood of confounding an appreciable number of reasonably 17 prudent purchasers exercising ordinary care." 18 DaimlerChrysler Corp., 534 F.3d 1017, 1025-26 (9th Cir. 2008) 19 (quotations and internal citations omitted). 20 have failed to explain how Defendants' practices were likely to 21 deceive reasonably prudent purchasers when Defendants disclosed 22 that they would charge the additional fees which are the focus of 23 Plaintiffs' action. 24 fraudulent practices is DISMISSED with leave to amend. 25 26 27 28 See Section III.B.v, infra. As Instead, the plaintiff must produce evidence showing a iv. Clemens v. However, Plaintiffs Accordingly, Plaintiffs' UCL claim for Counts I & II: UCL and FAL Claims for False Advertising Plaintiffs allege that Defendants engaged in false advertising in violation of the UCL and FAL through "advertising displayed on 17 1 the Regus Website, www.craigslist.com, representations of 2 'furnished' offices, and representations of 'simple one page' lease 3 agreements, which fail to mention the amounts of additional charges 4 that will be assessed by Regus." 5 UCL prohibits "unfair, deceptive, untrue or misleading 6 advertising," Cal. Bus. & Prof. Code § 17200, and the FAL makes it 7 unlawful to induce the public to enter into any obligation through 8 the dissemination of "untrue or misleading" statements. 9 & Prof. Code § 17500. United States District Court For the Northern District of California 10 FAC ¶ 92; see also id. ¶ 88. The Cal. Bus. Defendants move to dismiss Plaintiffs' false advertising 11 claims on at least two grounds: (1) Plaintiffs have pled 12 insufficient facts to establish that they have standing; and (2) 13 Plaintiffs' claims lack the required particularity. 14 at 9, 12. 12(b)(1) MTD Both arguments have merit. 15 With respect to standing, a private person may only bring an 16 action under the UCL and FAL if he or she has "suffered injury in 17 fact and has lost money or property as a result of the unfair 18 competition." 19 Supreme Court has interpreted section 17204 to "impose[] an actual 20 reliance requirement on plaintiffs prosecuting a private 21 enforcement action under the UCL[] . . . ." 22 Cases, 46 Cal. 4th 298, 326 (2009). 23 Plaintiffs lack standing because they do not allege that they saw 24 or relied upon the allegedly false and misleading advertising. 25 12(b)(1) MTD at 9. 26 allegations are unnecessary to establish actual reliance. 27 12(b)(6) MTD at 8. Cal. Bus. & Prof. Code § 17204. The California In re Tobacco II Defendants contend that Plaintiffs respond that, under Tobacco II, such 28 18 Opp'n to Tobacco II involved false advertising claims against tobacco 1 2 companies. 3 contention that the plaintiffs lacked standing under the UCL 4 because they had not relied on the tobacco companies' 5 advertisements, the California Supreme Court stated: 6 8 9 10 United States District Court Addressing the tobacco company's [W]hile a plaintiff must allege that the defendant's misrepresentations were an immediate cause of the injury-causing conduct, the plaintiff is not required to allege that those misrepresentations were the sole or even the decisive cause of the injury-producing conduct. Furthermore, where, as here, a plaintiff alleges exposure to a long-term advertising campaign, the plaintiff is not required to plead with an unrealistic degree of specificity that the plaintiff relied on particular advertisements or statements. Finally, an allegation of reliance is not defeated merely because there was alternative information available to the consumer-plaintiff. 7 For the Northern District of California 46 Cal. 4th at 306. 11 12 13 Id. at 328. 14 that a plaintiff must show reliance to establish standing under the 15 UCL. 16 individualized reliance on specific representations where 17 Defendants have engaged in a long-term advertising campaign. 18 this case, Plaintiffs have failed to allege any reliance 19 whatsoever. 20 advertisements described in the FAC or received similar information 21 from any other advertising. 22 concerning reliance, the Court cannot conclude that Plaintiffs' 23 decision to use Defendants' services was influenced or reinforced 24 by Defendants' advertising. 25 allege sufficient facts to establish standing. 26 Thus, Tobacco II did not eliminate the requirement It merely held that a Plaintiff need not demonstrate In It is unclear whether they saw any of the In the absence of any allegations Accordingly, Plaintiffs have failed to Defendants also argue that the FAC fails to explain why the 27 targeted advertisements were misrepresentations. 28 at 14. Again, Defendants are correct. 19 12(b)(6) at MTD Among other things, the 1 targeted advertisements make the following claims: "[s]ave money"; 2 "[f]lexibility for your business"; "get down to business 3 instantly"; "match our office rental options to your business 4 needs"; "our solutions are designed to fit within your budget"; 5 "[s]imple, easy and flexible"; "fully-furnished"; "all-inclusive"; 6 and "one monthly fee"; and "one low monthly rate." 7 None of these advertising claims represent that Defendants will 8 refrain from charging customers additional fees, so it is unclear 9 how they relate to Plaintiffs' action. FAC ¶¶ 25-31. The FAC does nothing to United States District Court For the Northern District of California 10 clarify the matter. 11 claims amount to non-actionable puffery since they are vague and 12 highly subjective. 13 1399 (E.D. Cal. 1994). 14 Further, many of Defendants' advertising See Haskell v. Time, Inc., 857 F. Supp. 1392, Plaintiffs argue that, taken together, Defendants' 15 advertisements deceived them into believing that "[Defendants'] 16 'fully furnished' and 'all-inclusive offices' have 'one monthly 17 fee.'" 18 identified in the FAC that mentions "one monthly fee" was posted in 19 2004, about seven years before Plaintiffs executed their Office 20 Agreements. 21 changed since that time. 22 targeted in the FAC refer to a "single monthly invoice," which 23 could include multiple fees. 24 altogether clear from the 2004 advertisement that the additional 25 services targeted in the FAC would be included in one monthly fee. 26 The advertisement states: "With Regus executive suites you get a 27 complete, professional executive office environment included in one 28 monthly []fee. Opp'n to 12(b)(6) MTD. FAC ¶ 26. However, the only advertisement Defendants' business practices may have In fact, the more recent advertisements Id. ¶ 31. Further, it is not You'll also get professional receptionists, state- 20 1 of-the-art telecom and IT services, kitchen areas and cyber cafés." 2 Id. ¶ 31. 3 Accordingly, Plaintiffs' false advertising claims under the 4 UCL and FAL are DISMISSED with leave to amend. 5 complaint should do more than merely list advertisements that 6 Defendants have broadcast in the last decade. 7 how Plaintiffs relied on the advertisements and why the 8 advertisements are false and misleading. 9 United States District Court For the Northern District of California 10 11 v. Plaintiffs' amended It should explain Courts III-V: Concealment/Suppression and Negligent and Intentional Misrepresentation The gravamen of Plaintiffs' claims for 12 "concealment/suppression" (Count III), negligent misrepresentation 13 (Count IV), and intentional misrepresentation (Count V) is that 14 Defendants failed to disclose or failed to adequately disclose 15 various fees assessed against Plaintiffs. 16 Plaintiffs' concealment/suppression claim, Plaintiffs allege that 17 Defendants actively concealed the amounts of additional fees "by 18 not stating the amounts in the Office Agreement or Fine Print, by 19 using extremely small font, and by failing to provide adequate 20 disclosures that are clear and conspicuous." 21 in their misrepresentation claims, Plaintiffs allege that 22 Defendants falsely represented that Plaintiffs' total monthly 23 payments would be the amounts stated in the Office Agreement. 24 ¶¶ 106, 107, 113. With respect to FAC ¶ 30. Likewise, Id. 25 Defendants argue that they disclosed that additional fees 26 would be charged, pointing out that the Office Agreement, which is 27 referenced in but not attached to the FAC, represents that the 28 stated monthly office fees "exclud[e] tax and exclud[e] services." 21 1 12(b)(1) MTD at 15. 2 in the "Terms and Conditions," which are incorporated by reference 3 into the Office Agreement. 4 seriously respond to this argument, except to suggest that 5 Defendants' disclosures were not conspicuous enough because they 6 were made in five-point font or in the fine print. 7 12(b)(6) MTD at 17. 8 suggesting what size font Defendants were required to use or that a 9 disclosure in an agreement must be conspicuous to be effective. United States District Court For the Northern District of California 10 Defendants also point to various disclosures See id. at 4. Plaintiffs do not See Opp'n to However, Plaintiffs cite no authority Under California law, "[t]he adequacy of a disclaimer in the 11 context of an action for fraud is judged by reference to the 12 plaintiff's knowledge and experience[.]" 13 Ins. Co. of Am., 171 Cal. App. 4th 912, 921 (2009). 14 generally denied where the plaintiff's reliance on the defendant's 15 misrepresentation is "manifestly unreasonable" in light of the 16 plaintiff's intelligence and information. 17 negotiate a contract at arm's length, "it is not reasonable to fail 18 to read a contract before signing it." 19 N.A., 691 F.3d 1152, 1163 (9th Cir. 2012). 20 appears to be the case here. 21 Broberg v. Guardian Life Id. Recovery is Where the parties Davis v. HSBC Bank Nevada, Based on the FAC, that Accordingly, the Court GRANTS Defendants' motion to dismiss 22 with respect to Counts III, IV, and V, and GRANTS Plaintiffs leave 23 to amend those claims. 24 specifically allege what was not disclosed in the agreements they 25 signed with Defendants and/or what Defendants misrepresented to 26 them about their monthly fees and why it was reasonable for 27 Plaintiffs to rely on those misrepresentations despite the language 28 of the agreements. Plaintiffs' amended complaint should 22 1 2 vi. Counts VII & VIII: NYSGBL Sections 349 and 350 Defendants argue that CTNY lacks standing to bring causes of 3 action under NYSGBL sections 349 and 350 because Plaintiffs have 4 not alleged a consumer-oriented harm. 5 unlawful "deceptive acts or practices" and "false advertising" in 6 the conduct of "any business, trade or commerce." 7 Law §§ 349(a), 350. 8 general, but also provides that "any person" who has been injured 9 by actions prohibited by the law may bring an action "in his own Sections 349 and 350 declare N.Y. Gen. Bus. Section 349 authorizes suits by the attorney United States District Court For the Northern District of California 10 name to enjoin such unlawful act" or "to recover his actual damages 11 or fifty dollars, whichever is greater." 12 Id. § 349(b), (h). Section 349 "was intended to empower consumers; to even the 13 playing field in their disputes with better funded and superiorly 14 situated fraudulent businesses. 15 action to recover damages for breach of contract between parties to 16 an arm's length contract." 17 N.Y.S.2d 769, 774 (N.Y. Sup. Ct. 1995). 18 matter, a plaintiff bringing a claim under section 349 must charge 19 the defendant with conduct that is consumer-oriented. 20 Laborers' Local 214 Pension Fund v. Marine Midland Bank, N.A., 85 21 N.Y.2d 20, 25 (N.Y. 1995). 22 advertising which is consumer-oriented. 23 v. Yellow Book USA, Inc., 309 F. Supp. 2d 401, 405 (E.D.N.Y. 2004). 24 It was not intended to supplant an Teller v. Bill Hayes, Ltd., 630 Thus, as a threshold Oswego Likewise, section 350 only pertains to Verizon Directories Corp. To establish that the defendant's conduct is consumer- 25 oriented, the plaintiff "must demonstrate that the acts or 26 practices have a broader impact on consumers at large. 27 contract disputes, unique to the parties, for example, would not 28 fall within the ambit of the statute." 23 Private Oswego, 85 N.Y.2d at 25. 1 Further, to avoid "the potential for a tidal wave of litigation 2 against businesses that was not intended by the Legislature," New 3 York courts have adopted an objective definition of deceptive acts 4 and practices, which limits actionable conduct to that which is 5 "likely to mislead a reasonable consumer acting reasonably under 6 the circumstances." 7 Id. at 26. A review of the case law in this area further illuminates the 8 standard for finding consumer-oriented conduct. 9 court found consumer-oriented conduct where a pension fund opened a In Oswego, the United States District Court For the Northern District of California 10 savings account with a bank that was acting as the fund's 11 investment advisor on the ground that the bank "dealt with 12 plaintiffs' representative as any customer entering the bank to 13 open a savings account, furnishing the Funds with standard 14 documents presented customers upon the opening of accounts." 15 N.Y.2d at 26-27. 16 York v. Feldman, 210 F. Supp. 2d 294 (S.D.N.Y. 2002), where the 17 state of New York alleged that the defendant engaged in a scheme to 18 manipulate public stamp auctions. 19 parties injured by the alleged scheme "included, among others, 20 unsophisticated individual sellers, such as the elderly and one- 21 time participants." 22 no consumer-oriented conduct was found in Cruz v. NYNEX Information 23 Resources, 263 A.D.2d 285 (N.Y. Sup. Ct.), where a group of 24 businesses filed suit in connection with advertisements they had 25 placed in the Yellow Pages. 26 transactions at issue were "modest in value," "repeated regularly 27 with numerous parties," and "involve[d] parties with a large 28 disparity in economic power and sophistication," plaintiffs had 85 Consumer-oriented conduct was also found in New The court reasoned that the Feldman, 210 F. Supp. 2d at 301. In contrast, The court reasoned that although the 24 1 failed to show how the alleged misconduct might either directly or 2 potentially affect consumers since "advertisement space in the 3 Yellow Pages is, by definition, a commodity available to businesses 4 only . . . ." 5 Cruz, 263 A.D.2d at 291. The Court finds that this case is more like Cruz than Oswego 6 or Feldman. 7 presented with a standardized contract, Plaintiffs have made no 8 showing that Defendants' alleged misconduct has the potential to 9 affect consumers at large. While CTNY was treated like a consumer in that it was All three Plaintiffs are businesses and United States District Court For the Northern District of California 10 their claims relate to Defendants' practices in marketing and 11 managing commercial office space, a commodity which is only 12 available to businesses. 13 practices are sufficiently consumer-oriented because they affect 14 all consumers of office space in New York, be they entrepreneurs or 15 individuals seeking to lease a single office or start a company, or 16 a small business leasing multiple office spaces." 17 12(b)(6) MTD at 14. 18 Plaintiffs would only be interested in commercial office space for 19 business purposes. 20 that their suit will benefit New York consumers. 21 22 Plaintiffs argue that "Defendants' Opp'n to However, all of the parties listed by As such, Plaintiffs cannot credibly contend Accordingly, Plaintiffs' claims under NYSGBL Sections 349 and 350 are DISMISSED WITH PREJUDICE. 23 vii. Counts VI & IX: Unjust Enrichment 24 Plaintiffs bring two claims for unjust enrichment, one under 25 California law (Count VI) and the other under New York law (Count 26 IX). 27 Plaintiffs allege that Defendants were unjustly enriched as a 28 result of their wrongful conduct and that it would be against The two claims are practically identical. 25 In both, 1 equity and good conscience to permit Defendants to retain the ill- 2 gotten benefits. 3 dismiss both claims. 4 FAC ¶¶ 122-23, 141-42. Defendants move to As to Count VI, Defendants argue that recent authority action under California law. 7 Reinalt-Thomas Corp., 11-CV-03548-LHK, 2012 WL 1438812 (N.D. Cal. 8 Apr. 25, 2012). 9 Having reviewed numerous discussions, this Court is persuaded by, 10 United States District Court suggests that unjust enrichment is not an independent cause of 6 For the Northern District of California 5 and adopts the reasoning of, the cases which hold that claims for 11 restitution or unjust enrichment may survive the pleading stage 12 when pled as an alternative avenue of relief, though the claims, as 13 alternatives, may not afford relief if other claims do. 14 Vicuna v. Alexia Foods, Inc., C 11-6119 PJH, 2012 WL 1497507, at *3 15 (N.D. Cal. Apr. 27, 2012); Larsen v. Trader Joe's Co., C 11-05188 16 SI, 2012 WL 5458396, at *7 (N.D. Cal. June 14, 2012). 17 Count VI is DISMISSED with leave to amend. 18 their complaint to plead this claim in the alternative. 19 MTD at 20-21 (citing Williamson v. However, not all courts agree on this issue. E.g., Accordingly, Plaintiffs may amend With respect to Count IX, Defendants argue that Plaintiffs 20 cannot recover on a theory of unjust enrichment under New York law 21 because the parties executed an agreement governing the subject 22 matter of the dispute. 23 California law, "[t]he theory of unjust enrichment lies as a quasi- 24 contract claim." Goldman v. Metro. Life Ins. Co., 5 N.Y.3d 561, 25 572 (N.Y. 2005). Some New York courts have reasoned that, because 26 unjust enrichment creates an obligation in the absence of an 27 agreement, a claim for unjust enrichment cannot be sustained if a 28 valid contract governs the relevant subject matter. MTD at 21. 26 Under New York law, as under Id. Other 1 courts have held that New York law permits alternative pleading of 2 breach of contract and unjust enrichment claims. See Vertex Constr. 3 Corp. v. T.F.J. Fitness L.L.C., 0-CV-683 (CBA) (ALC), 2011 U.S. 4 Dist. LEXIS 135453, 11, 2011 WL 5884209, at *11 (E.D.N.Y. Nov. 23, 5 2011). 6 Under Goldman, claims for unjust enrichment may only be dismissed 7 where the subject matter of the dispute is clearly governed by 8 contract. 9 Office Agreements at issue here remains unclear and is subject to Defendants' argument fails under both lines of cases. As discussed in Section III.B.v supra, the scope of the United States District Court For the Northern District of California 10 dispute. 11 unjust enrichment are disfavored "because it is difficult to 12 determine the validity or scope of the contract at the pleading 13 stage." 14 Accordingly, Defendants' motion to dismiss Count IX is DENIED. Likewise, under Vertex, motions to dismiss claims for 2011 WL 5884209, at *11 (quotations omitted). 15 16 17 IV. CONCLUSION For the foregoing reasons, Defendant Regus plc's Rule 12(b)(1) 18 motion to dismiss for lack of personal jurisdiction is DENIED 19 WITHOUT PREJUDICE. 20 LLC, Metro Talent, LLC, and CTNY Insurance Group LLC leave to 21 conduct jurisdictional discovery. 22 Regus plc may again move to dismiss pursuant to Rule 12(b)(1). 23 Court also GRANTS in part and DENIES in part Defendants Regus 24 Management Group LLC, Regus Business Centre LLC, Regus plc, and HQ 25 Global Workplaces LLC's 12(b)(6) motion to dismiss for failure to 26 state a claim. The Court GRANTS Plaintiffs Circle Click Media 27 28 27 Once that discovery is complete, The 1 • Count I is DISMISSED WITH PREJUDICE to the extent that it is 2 predicated on a violation of California Civil Code section 3 1950.8. 4 • Count I remains undisturbed to the extent that it is 5 predicated on a violation of California Civil Code section 6 1671(b). 7 • Count I is DISMISSED with leave to amend to the extent that it 8 is predicated on California Civil Code sections 1572, 1709, 9 and 1710, and Defendants' allegedly unfair and fraudulent United States District Court For the Northern District of California 10 11 business practices. • Counts I and II are DISMISSED with leave to amend to the 12 extent that they are predicated on Defendants' allegedly false 13 and misleading advertising. 14 • Counts III through VI are DISMISSED with leave to amend. 15 • Counts VII and VIII are DISMISSED WITH PREJUDICE. 16 • Count IX shall remain undisturbed. 17 Plaintiffs shall file an amended complaint within thirty (30) days 18 of the signature date of this Order. 19 in the dismissal with prejudice of the claims which the Court has 20 granted Plaintiffs leave to amend. Failure to do so may result 21 22 IT IS SO ORDERED. 23 24 25 Dated: January 3, 2013 UNITED STATES DISTRICT JUDGE 26 27 28 28

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