Adkins et al v. Apple Inc et al

Filing 335

ORDER DENYING PLAINTIFF'S APPLICATION UNDER FRCP 56(d) AND GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT. Signed by Judge William H. Orrick on 01/11/2017. (Redacted of confidential information.) (jmdS, COURT STAFF) (Filed on 1/11/2017)

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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 FABRIENNE ENGLISH, Case No. 3:14-cv-01619-WHO Plaintiff, 8 v. 9 10 APPLE INC, et al., Defendants. Re: Dkt. No. 288 11 United States District Court Northern District of California ORDER DENYING PLAINTIFF’S APPLICATION UNDER FRCP 56(d) AND GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT 12 INTRODUCTION 13 14 Defendants Apple Inc., AppleCare Service Company Inc., and Apple CSC Inc. 15 (collectively, “Apple”) move for summary judgment of Plaintiff Fabrienne English’s claims 16 related to Apple’s alleged misrepresentations and omissions in connection with AppleCare+ 17 (“AC+”), an extended service plan Apple offers to purchasers of iPhones. English’s core 18 complaint is that Apple misrepresents to consumers that replacement iPhones under AC+ will be 19 new when in fact many of the replacement devices in Apple’s service stock are “refurbished” or 20 otherwise not new. She asserts claims under California law for violations of the Consumer Legal 21 Remedies Act (“CLRA”), the False Advertising Law (“FAL”), the Unfair Competition Law 22 (“UCL”), and the Secondhand Merchandize Labeling Law, Cal. Bus. & Prof. Code § 17531, and 23 for fraud. 24 English urges me to deny Apple’s motion for summary judgment, or to stay the matter 25 pending additional discovery to give her the opportunity to present facts essential to justify her 26 opposition under Federal Rules of Civil Procedure 56(d). She insists that, through additional 27 discovery and/or testing of the phone, she can prove that her replacement phones under AC+ were 28 not new when Apple gave them to her. I have already found that the phones she received were 1 new, and she has not convinced me that any proposed testing would demonstrate otherwise. She 2 also fails to justify her delay in pursuing additional discovery, and since it is disproportional to her 3 claims anyway, she is not entitled to it. Her 56(d) application is DENIED. 4 Because English does not offer sufficient evidence to establish that she relied on any 5 alleged misrepresentation by Apple, she fails to make the requisite showing for Article III standing 6 that her injury was caused by Apple. Her Secondhand Merchandize Labeling Law claim fails 7 because she fails to show a genuine issue as to whether the phones she received were anything 8 other than new. Although there may be a genuine issue whether English was denied a second 9 incident under AC+, that fact is not material to any of her claims. Apple’s motion for summary 10 judgment is GRANTED. BACKGROUND United States District Court Northern District of California 11 12 I. FACTUAL BACKGROUND 13 A. AC+ and APP AC+ is a service plan offered by Apple for, among other products, the iPhone. Healy 14 15 Decl. ¶¶ 3–4 (Dkt. No. 209-32). APP is a predecessor to AC+.1 Id. ¶ 3. Apple offered APP until October 2011. Id. APP cost $99 and provided consumers with 16 17 hardware repair coverage and telephone technical support for two years from the date of purchase 18 of the iPhone.2 Id. Apple launched AC+ in October 2011. Id. ¶ 4. For $99, purchasers receive coverage for 19 20 two accidental damage incidents. Id. The service fee for each incident was initially $49. Id. On 21 September 10, 2013, the service fee was increased to $79. Id. ¶ 5. There is no service fee under 22 AC+ for repairs not resulting from accidental damage. Id. ¶ 6. 23 From AC+’s first launch until September 2013, Apple allowed customers to purchase AC+ 24 at the time of accidental damage. Id. ¶ 8. During that time period, if a customer’s iPhone suffered 25 1 26 27 In her TAC and briefing, English describes AC+ and APP as “essentially extended warranties.” TAC ¶ 11 (Dkt. No. 139). I use “service plans” instead of “extended warranties” in this Order unless quoting from materials submitted by English. 2 28 Every new iPhone comes with a one year limited warranty and 90 days of telephone technical support. See Patel Decl. Ex. R (Dkt. No. 209-19). 2 1 accidental damage, rather than having to pay $149 for an out-of-warranty service event or 2 approximately $449 for a new iPhone, the customer could purchase AC+ for $99 and receive a 3 $50 discount on the $149 out-of-warranty service event, plus the two accidental damage incidents 4 provided under AC+. Id. As discussed in more detail below, English purchased her AC+ plan in 5 this way. TAC ¶ 34. A customer who brings in her iPhone for service under AC+ or APP may have the iPhone 6 7 repaired or replaced, depending on the circumstances (e.g., whether a repair is feasible) and the 8 customer’s preference. When a customer decides to replace her iPhone, she receives a 9 replacement device out of Apple’s “service stock.” Apple describes its service stock as consisting of three types of iPhones: (1) new iPhones; (2) remanufactured iPhones; and (3) reclaimed 11 United States District Court Northern District of California 10 iPhones. Lanigan Decl. ¶ 3 [sealed](Dkt. No. 208-17); Lanigan Decl. ¶ 3 [redacted](Dkt. No. 209- 12 34) . 13 14 New iPhones are made of all new parts and are “exactly the same” as the iPhones Apple sells in its stores. Lanigan Decl. ¶ 4. New iPhones 15 Id. As discussed 16 17 below in more detail, the evidence in this case shows that English received only new iPhones as 18 replacement devices, not remanufactured or reclaimed iPhones. Id. ¶¶ 9–10. 19 Remanufactured iPhones are manufactured using the same process as new iPhones, but 20 “could contain both new parts and recovered parts that have been extensively tested.” Id. ¶ 5. 21 Apple states that “each and every remanufactured iPhone is inspected and tested to ensure that it is 22 equivalent to a new iPhone in performance and reliability.” Id. 23 Reclaimed iPhones are iPhones that have either 24 25 26 . Id. ¶ 6. Apple states that “[t]hese (essentially new) iPhones undergo a testing and screening process to ensure that they are equivalent to new in 27 28 3 1 performance and reliability.”3 Id. All iPhones in Apple’s service stock are shipped and stored in plain, white, unbranded 2 3 boxes. See Williams Dep. at 210–11 (Patel Decl. Ex. T, Dkt. No. 209-21). Because all iPhones in 4 the service stock are shipped and stored in this manner, Apple store employees do not know 5 whether any particular replacement device is new, remanufactured, or reclaimed. Id. at 152–53, 6 231–32. Customers who receive a replacement device do not keep the plain, white, unbranded 7 box in which it is carried out from the service stock to the floor. Morrison Dep. 202:5–9 (Dkt. No. 8 288-2). The current AC+ terms and conditions state in relevant part: 9 If during the plan term you submit a valid claim . . . , Apple will either (a) repair the defect at no charge, using new parts or parts that are equivalent to new in performance and reliability, or (b) exchange the [iPhone], with a replacement product that is new or equivalent to new in performance and reliability. All replacement products provided under this plan will at a minimum be functionally equivalent to the original product. 10 United States District Court Northern District of California 11 12 13 14 TAC Ex. B (Dkt. No. 139-2); Patel Decl. Ex. O (Dkt. No. 209-16). The AC+ and APP terms and conditions in effect until September 2013 similarly stated: 15 If during the coverage period you submit a valid claim. . . , Apple will either (a) repair the defect at no charge, using new or refurbished parts that are equivalent to new in performance and reliability, or (b) exchange the [iPhone] with a replacement product that is new or equivalent to new in performance and reliability, and is at least functionally equivalent to the original product. 16 17 18 19 TAC Ex. C (Dkt. No. 139-3). 20 B. English’s Purchase and Use of AC+ In September 2012, English obtained an iPhone 4 from Sprint in connection with signing 21 22 up for Sprint wireless telephone service. English Decl. ¶ 3 (Dkt. No. 180-43); Patel MSJ Decl. Ex. 23 2, English Dep. at 71:9–23 (Dkt. No. 288-3). She gave the iPhone to her minor son. Id. On February 15, 2013, English and her son went to an Apple store in NorthPark Center, 24 25 Texas because the screen on the iPhone had cracked. English Decl. ¶ 4; English Dep. at 61:23–25. 26 27 28 3 In her TAC and briefing, English refers to all replacement iPhones other than new replacement iPhones as “refurbished.” See, e.g., TAC ¶ 11. For ease of reference, I do the same in this Order unless otherwise indicated. 4 1 English states that in discussing AC+ with an Apple employee at the store, she was told that she 2 “would have two ‘incidents’ available for occurrences such as a cracked screen or water damage, 3 and that the replacement devices would be new.” English Decl. ¶ 6. She paid $99 for AC+ and 4 another $99 to receive what the Apple employee allegedly described as a new iPhone 4. Id. ¶ 4; 5 see also TAC Ex. E (Dkt. No. 139-5). The replacement iPhone was presented to English in the plain, white, unbranded box in 6 which Apple packages its replacement devices. Patel MSJ Decl. Ex. 2 at 104:9–106:16, 140:4– 8 141:8. The box did not include “any label or other writing indicating that the [iPhone] was 9 refurbished, reconditioned, used, or contained parts that were refurbished, reconditioned, or used.” 10 TAC ¶ 40. English states that the Apple employee “took great care to unseal and open [the box] in 11 United States District Court Northern District of California 7 front of [her],” and that “[w]hen he took the iPhone out of the packaging he did so in a way that 12 made [her] think that the device was new.” English Decl. ¶ 7. English was not given the box, nor 13 was she given a charger or earbuds. English Dep. at 105:1, 106. At the time English purchased AC+, the plan’s terms and conditions were available in hard 14 15 copy, available at, and provided via URL on “Smart Signs” (i.e., interactive iPads) 16 throughout the store. Healy Decl. ¶¶ 9–11 (Dkt. No. 209-32). The Smart Signs state that 17 “replacement equipment that Apple provides as part of the repair or replacement service may be 18 new or equivalent to new in both performance and reliability.” Healy Decl. Ex. A (Dkt. No. 209- 19 33) at APL000029437. English also received a pdf of the AC+ terms and conditions via email. 20 English Dep. at 108:11. English admits that she never read the AC+ terms and conditions.4 21 English Dep. at 107:18–108:17, 124:6–128:13. English contends that the replacement iPhone she received on February 15, 2013 was not 22 23 new and was in fact a “refurbished device.” English Decl. ¶ 9. She states that “[h]ad [she] known 24 that [the] iPhone was not new, [she] would not have made the purchase, and would have 25 4 26 27 28 English claims to have read and relied on the Repair Terms and Conditions prior to purchasing AC+. English 2nd Decl. ¶ 14 (Dkt. No. 304-15). It provides, “When the product is covered by warranty or an extended service contract, such as the AppleCare Protection Plan, Apple will perform repairs under the terms of the warranty or the extended service contract, provided that you have presented satisfactory proof of the products’ eligibility for such repairs.” TAC Ex. D (“Apple Inc. Repair Terms and Conditions”)(Dkt. No. 38-4). 5 1 considered other options such as getting an upgraded phone from Sprint.” Id. ¶ 5. 2 Apple contends that the replacement iPhone was new. See Lanigan Decl. ¶ 9. It submits a 3 declaration from Michael Lanigan, Director of AppleCare Supplier Quality Engineering and Mail- 4 In Operations, who Id. ¶ 1. He states that based on his research and 5 6 analysis of Apple’s records, the iPhone English received on February 15, 2013 was a new device. 7 Id. ¶ 9. 8 English alleges that she “immediately started experiencing problems” with the replacement 9 iPhone. English Decl. ¶ 11. The device “would freeze, stop working, and close without warning.” Id. On July 22, 2013, she and her son went to an Apple store in Plano, Texas after the device 11 United States District Court Northern District of California 10 completely stopped working and would no longer turn on. Id. An Apple employee there told her 12 that the device had water damage and that she could use one of the accidental damage incidents 13 under her AC+ plan to get a replacement. Id. English paid the $49.00 AC+ service fee and 14 received another replacement iPhone 4. Id.; see also Patel Decl. Ex. E (Dkt. No. 209-6). This 15 replacement device was again presented in a plain, white, unbranded box. English Decl. ¶ 11. 16 According to English, the second replacement device, like her first one, was “refurbished.” Id. 17 According to Apple, it was in fact new. Lanigan Decl. ¶ 10. English states that within a week of 18 receiving the second replacement device, it began suffering from “freezing issues” like those 19 exhibited by the first one. English Decl. ¶ 12. 20 On February 28, 2014, English went back to the Apple store in North Park Center, Texas 21 because the screen on her second replacement iPhone had cracked. English Decl. ¶ 13. English 22 alleges that she was told by an Apple employee there that she had already used up both incidents 23 allowed under her AC+ plan, and that as a result she was not entitled to another replacement 24 device. English Dep. at 160:15–21. She states that the employee “cited [her] initial purchase from 25 Apple in February 2013 and the July 2013 replacement as the incidents of accidental damage 26 replacement that [she] was entitled to under [her AC+ plan].” English Decl. ¶ 13. 27 II. PROCEDURAL BACKGROUND 28 English initially brought her claims as one of three plaintiffs in a class action complaint 6 1 filed by attorney Renee Kennedy. See Compl. (Dkt. No. 1). With the filing of the second 2 amended complaint on January 17, 2015, the other two named plaintiffs dropped out, while a new 3 named plaintiff joined in. See Dkt. No. 116. They filed the TAC on March 6, 2015, alleging four 4 causes of action against Apple based on alleged misrepresentations and omissions in connection 5 with AC+ and APP: (1) violations of the CLRA, TAC ¶¶ 73–94; (2) violations of the FAL, TAC 6 ¶¶ 103–111; (3) violations of the unlawful, unfair, and fraudulent prongs of the UCL, TAC ¶¶ 7 121–127; (4) violations of the Secondhand Merchandise Labeling Law, Cal. Bus. & Prof. Code § 8 17531, TAC ¶¶ 112–120; and (5) fraud, TAC ¶¶ 95–102. Shortly after the TAC was filed, on 9 March 19, 2015, the other named plaintiff dropped out of the case, leaving English as the only 10 named plaintiff. See Dkt. No. 144.5 On January 5, 2016, I denied English’s motion for class certification because none of her United States District Court Northern District of California 11 12 theories of liability supported class certification, and also because she could not establish 13 adequacy of counsel under Federal Rule of Civil Procedure 23(a)(4) in light of the deficiencies 14 shown by her lead counsel, Ms. Kennedy. Class Certification Order (Dkt. No. 225). On 15 September 23, 2016, Apple filed its motion for summary judgment on English’s individual claims 16 related to her purchase of AC+ and alleged denial of coverage for a second incident. See Mot. 1–2 17 (Dkt. No. 288). 18 On October 15, 2016, one of plaintiff’s former co-counsels, who apparently had gained 19 possession of the July 2013 replacement phone that English had received under AC+ and 20 misplaced it, notified Kennedy that he had located it. Kennedy Decl. ¶ 4 (Dkt. No. 293-1). 21 Plaintiff filed several motions seeking leave for permission to test the phone, and an extension of 22 time to file her opposition. Dkt. Nos. 290, 293, 295, 296, 299. On October 24, 2016, I extended 23 her deadline by four days (Dkt. No. 300), and she filed her opposition on October 28, 2016. 24 Opp’n (Dkt. No. 305[redacted], Dkt. No. 304-3[under seal]). On October 31, 2016, I denied her 25 request to test the phone, in part because plaintiff had not: 26 27 5 28 Since English does not allege that she ever purchased the APP service plan, it is no longer at issue in this case. 7 1 2 3 4 specifically respond[ed] to defendants’ arguments that testing the iPhone now will not prove that it was new or refurbished when plaintiff received it from Apple in 2013, that the testing is not proportionate to the needs of the case, that plaintiff has not provided sufficient detail regarding the tests she proposes to run, and that she has not provided a written description of the proposed testing protocol. Dkt. No. 307. But I also left open the possibility that briefing and evidence concerning the motion 5 for summary judgment might establish the need for such testing. I heard argument from the 6 parties on December 14, 2016. 7 8 III. BACKGROUND OF 56(D) MOTION Relevant to English’s request for additional discovery, she proffered two affidavits that 9 identify three categories of discovery: additional information to determine whether or not her 10 United States District Court Northern District of California 11 12 13 14 15 replacement unit was new; “testing” of the recently found 2013 replacement unit; and an additional deposition of Apple employee “Ryan.” English Decl. 56(d) ¶ 5 (Dkt. No. 304-15); English 2nd Decl. ¶¶ 10–13, 16. She submits that (1) “fingerprints, scratches and stickers on the internal parts are evidence that the phone is refurbished;” (2) “[e]xperts can tell if the phone has been opened before;” and (3) “[t]here are diagnostic, software and application tests that can be run.” English Decl. ¶ 5 (citing Dixon Decl., Ex. M; and Huynh Decl., Ex. R). 16 LEGAL STANDARD 17 Summary judgment on a claim or defense is appropriate “if the movant shows that there is 18 no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of 19 law.” Fed. R. Civ. P. 56(a). In order to prevail, a party moving for summary judgment must show 20 the absence of a genuine issue of material fact with respect to an essential element of the non21 moving party’s claim, or to a defense on which the non-moving party will bear the burden of 22 persuasion at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the movant has 23 made this showing, the burden then shifts to the party opposing summary judgment to identify 24 “specific facts showing there is a genuine issue for trial.” Id. The party opposing summary 25 judgment must then present affirmative evidence from which a jury could return a verdict in that 26 party’s favor. Anderson v. Liberty Lobby, 477 U.S. 242, 257 (1986). 27 28 8 1 On summary judgment, the Court draws all reasonable factual inferences in favor of the 2 non-movant. Id. at 255. In deciding a motion for summary judgment, “[c]redibility 3 determinations, the weighing of the evidence, and the drawing of legitimate inferences from the 4 facts are jury functions, not those of a judge.” Id. However, conclusory and speculative testimony 5 does not raise genuine issues of fact and is insufficient to defeat summary judgment. See Thornhill 6 Publ’g Co., Inc. v. GTE Corp., 594 F.2d 730, 738 (9th Cir. 1979). 7 8 9 10 United States District Court Northern District of California 11 12 13 Under Federal Rule of Civil Procedure 56(d), If a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order. Fed. R. Civ. P. 56(d). “[A] district court should continue a summary judgment motion upon a good faith showing 14 by affidavit that the continuance is needed to obtain facts essential to preclude summary 15 judgment.” State of Cal., on Behalf of California Dep't of Toxic Substances Control v. Campbell, 16 138 F.3d 772, 779 (9th Cir. 1998). The party seeking to continue the motion “must show (1) that 17 they have set forth in affidavit form the specific facts that they hope to elicit from further 18 discovery, (2) that the facts sought exist, and (3) that these sought-after facts are ‘essential’ to 19 resist the summary judgment motion.” Id. 20 DISCUSSION 21 All five of English’s claims stem from her allegation that Apple misrepresented or omitted 22 the fact that she might not obtain a new replacement unit when receiving service under AC+. See 23 TAC ¶¶ 73–127. Apple argues that, since she did in fact receive new phones on both occasions, 24 all of her claims must fail. Mot. at 1. First, Apple states that English has suffered no injury since 25 she received new phones, and so Apple is entitled to summary judgment because English lacks 26 Article III standing for all five claims. Mot. at 9. Next, Apple contends that it did not 27 “misrepresent” that English would receive a new phone, because she did in fact receive a new 28 phone. Id. at 11. In the absence of any misrepresentation, her claims under the UCL, FAL, CLRA 9 1 and for fraud must fail. Id. And, since she received a new phone, her Secondhand Merchandising 2 Labeling Law claim must fail. Id. at 12. 3 In the alternative, Apple argues for partial summary judgment to the extent her claims under the UCL, FAL, CLRA and for fraud depend on English’s reliance on the AC+ terms and 5 conditions, because the undisputed evidence establishes that she never viewed the terms and 6 conditions prior to purchasing the plan. Id. at 13. Additionally, Apple argues for partial summary 7 judgment to the extent her claims depend on a theory that Apple’s use of a plain white box 8 misrepresents that replacement phones are new because using a plain white box is not an 9 affirmative representation at all and plaintiff cannot meet the reasonable consumer standard. Id. at 10 15. Lastly, Apple argues for summary judgment on English’s claim that she was denied a second 11 United States District Court Northern District of California 4 incident because the undisputed facts prove that she was not denied a second incident. Id. at 17. 12 English asserts the following genuine issues of material fact: whether the service units 13 were in fact new; whether she was denied a second incident under AC+; and whether Apple 14 properly discloses the plan’s length of time. Opp’n 8–15. English contends that she still suffered 15 an injury, even if the iPhones she received as replacement units were new, but she admits that 16 “[t]he main fact in contention is whether Plaintiff’s replacement iPhones [“service units”] are new 17 rather than used or refurbished.” Id. at 6. 18 I. PLAINTIFF’S 56(D) APPLICATION IS DENIED 19 A. English’s Delay in Conducting Discovery 20 On September 9, 2015, Apple filed a declaration with its opposition to class certification 21 from Michael Lanigan, who “reviewed Apple’s database containing information regarding the 22 source of iPhones used as replacement devices under AC+[,]” and discovered “the two 23 replacement iPhones that Plaintiff received were ‘new’—meaning they were ‘made of entirely 24 new parts, and therefore are exactly the same as the iPhones Apples sells as new in Apple-branded 25 boxes in its retail stores.’” Id. at 10:1–6 (quoting Lanigan Decl. ¶¶ 1, 4). As discussed during the 26 hearing on class certification, English had three weeks to pursue discovery on the issue prior to 27 filing her reply to Apple’s opposition to class certification. Class Certification Hr’g Tr. at 6:14– 28 10 1 19. She did none. One of her former co-counsels, Mr. Cutter,6 who ably argued her motion for 2 class certification, accepted the evidence that English received a new rather than refurbished 3 phone: “[y]ou know, I have no reason not to take Ms. Preovolos, who’s distinguished counsel, lot 4 of experience, that she—likely it’s true… .” Hr’g Tr. at 9:6–9. I understood that representation as 5 a waiver of English’s claim to additional discovery on Lanigan’s testimony.7 Apple correctly 6 states that the undisputed evidence at class certification established, and I concluded, that the 7 replacement iPhones were new. Mot. for Summ. J. at 1:7–8; id. at 8–11 (Dkt. No. 288). I denied class certification in January, 2016, denied English’s motion for reconsideration in 8 March, and the Ninth Circuit denied her petition for review in June. Nonetheless, English waited 10 until the last day of August to seek any discovery related to her individual claims, even though she 11 United States District Court Northern District of California 9 knew since a Case Management Conference on July 9, 2016 that her opposition to summary 12 judgment would be due on October 24, 2016. Dkt. No. 289 at 3–4; Minute Entry (Dkt. No. 275). 13 All in all, she waited nearly an entire year to seek discovery on the Lanigan testimony that she 14 now seeks to question. See Reply at 3 (Dkt. No. 320); Defs.’ Opp’n to Pl.’s Administrative Mot. 15 to Extend Time at 1–3 (Dkt. No. 292); Patel Decl. (Dkt. No. 292-2). 16 There have been many requests for extensions in this case. English apparently feels 17 aggrieved—in her administrative motion for an extension of time (Dkt. No. 290), she states, 18 “please note that this Court has granted at least seven of Defendants’ motions for extension of 19 time if not more, but has never granted one of Plaintiff’s motions as to extension of time.” 20 10/10/16 Admin. Mot. at 6:7–10. Reality is much different, as shown below: DATE ECF REQUESTED FOR FILING RESOLUTION REASON NO. BY 4/29/15 67 Apple Declaration ISO Granted Unopposed Sealing 2/9/15 134 Apple Response to Granted Stayed until after Second Court rules on Amended Plaintiffs’ pending Complaint motion for leave to 21 22 23 24 25 26 6 27 28 Two California law firms and four solo practioners at different times have represented English in addition to her lead lawyer, Renee Kennedy. 7 I noted in the Order Denying Class Certification that “English withdrew her request for further discovery on this issue.” Dkt. No. 225 at 14:1–2. 11 1 2 4/1/15 149 3 4 Apple, with contingent request by plaintiffs 30(b)(6) depositions Granted as to both 5 6 7 8 7/6/15 185 Apple 7/16/15 194 Apple 17 10/2/15 216 Apple 18 2/17/16 243 English 3/18/16 260 Apple 9 10 Granted Declaration ISO Sealing Reply to Motion for Reconsideration Granted Declaration ISO Sealing Opposition to SJ Granted Stipulation for 7 day extension granted, but request for 14 day extension denied Unopposed Granted in part No reason United States District Court Northern District of California 12 Granted, including an extension for English to file her Reply 13 14 15 16 20 21 10/24/16 300 English Extended plaintiffs’ deadline to file motion for class certification given the extended deposition deadline Unopposed Declaration ISO Sealing Opposition to Class Certification 11 19 file Third Amended Complaint Due to the number and variety of disputes over the appropriate scope Granted in Part In support of class certification, English filed a substantially revised memorandum of points and authorities more than one week after the filing deadline, including declarations from seven previously undisclosed fact and expert witnesses Unopposed 22 As evidenced by this chart, the only instances of extensions for substantive motions or 23 24 25 26 27 responses granted to Apple were prompted by English’s own actions. Moreover, when Apple was granted an extension, a corresponding extension was given to English. The docket is rife with the Court’s leniency in overlooking English’s failure to follow the Federal Rules of Civil Procedure, the Civil Local Rules and my Standing Orders during the pendency of this action. There is no good cause for English’s delay in conducting discovery. 28 12 1 2 B. Evidence Regarding the Phone The bulk of English’s claims stem from her belief that the replacement phones she received from Apple through AC+ were not new. See Opp’n at 6:5–6 (Dkt. No. 304-3). While that may be 3 her belief, I have already concluded in the Order Denying Class Certification that the phones she 4 received were new, and she has offered no evidence to shake my determination of that fact. 5 English now challenges the evidence that the phones were new by pointing to (1) her 6 phone’s malfunctions, (2) the presumed proportion of remanufactured phones versus new phones 7 in the supply channel for service units, and (3) the fact that it took Apple two years to uncover the 8 evidence that her iPhones were in fact new at the time she received them as service units. Opp’n 9 at 8–9. In the absence of actual evidence concerning the phones she received, none of these 10 suppositions holds water. United States District Court Northern District of California 11 12 13 14 Apple counters the first point by arguing that “brand new devices can on occasion malfunction,” and “[p]laintiff’s allegations and speculation ‘do not create a factual dispute for purposes of summary judgment.’” Reply at 8 (citing Nelson v. Pima Cmty. College Dist., 83 F.3d 1075, 1081–82 (9th Cir. 1996))(Dkt. No. 320). Apple points out that English “never sought 15 repairs or any other assistance from Apple regarding the issues, nor did she research how to 16 17 address the freezing issue… .” Id. (citing TAC ¶ 40 and English Dep.). I agree that English’s “conclusory allegations unsupported by factual data are insufficient… .” Arpin v. Santa Clara 18 Valley Transp. Agency, 261 F.3d 912, 922 (9th Cir. 2001), especially considering the variability 19 with which electronic devices malfunction. See, e.g., Pecht Report ¶ 23–26 (Dkt. No. 18920 1[sealed]; Lall Report ¶16c (Dkt. No. 208-25[sealed], 209-39[redacted]). 21 22 As to the second point, Apple highlights a previous order in which I found “evidence regarding the theoretical likelihood that English’s replacement iPhones would be refurbished does 23 little to counter evidence that the replacement devices she actually received were in fact new.” 24 Class Certification Order at 13:13–15 (emphasis in original) (Dkt. No. 225). The final point is 25 immaterial—the issue is whether there is a genuine dispute about its accuracy. None has been 26 raised. 27 28 13 1 2 1. Additional Discovery Related to the Phone English claims that summary judgment is improper because “necessary facts in existence are pending discovery.” Opp’n at 1. The parties submitted two Joint Letters regarding discovery 3 disputes—one on October 6 and one on October 20, 2016. Dkt. Nos. 289, 297. In the former, 4 plaintiff mentioned “discovery that Apple refuses to answer although served on 09.02.16,” as well 5 as an outstanding RFA and RFPs served on 10.04.16. Dkt. No. 289 at 1. In the latter letter, Apple 6 7 8 9 10 clarifies that it made its “last document production over a year ago, on July 1, 2015[,]” and that “Plaintiff waited until Sept. 28 [2016] (less than a month before her opposition brief [was] due) to raise any issues with respect to ‘updating’ the RFPs… .” Dkt. No. 297 at 3–4. Apple stated that “[t]here is nothing for the Court to compel” because “Defendants have produced all responsive, non-privileged documents for several of the RFPs[,]” and “[t]he remainder do not seek 11 United States District Court Northern District of California information that is relevant or likely to lead to the discovery of admissible evidence, and are 12 13 disproportional to the nature of Plaintiff’s individual claims.” Id. at 4:11–14. “Plaintiff has not adequately demonstrated that the request to postpone summary judgment 14 and extend discovery is not due to a lack of diligence, nor what specific facts would be shown by 15 16 17 additional discovery.” Thommeny v. Paramount Pictures Corp., 2011 U.S. Dist. LEXIS 80291, at *6 (C.D. Cal. July 13, 2011). Given plaintiff’s own delay, the waiver by her prior counsel, and the likelihood that additional discovery will fail to prove anything—let alone a fact “essential” to 18 resist summary judgment—English’s request for additional discovery is denied. See Volk v. D.A. 19 Davidson & Co., 816 F.2d 1406, 1416 (9th Cir. 1987)(“The burden is on the party seeking to 20 conduct additional discovery to put forth sufficient facts to show that the evidence sought exists.”) 21 22 23 24 25 26 27 2. Testing the Phone English states that “if the Court were to force us to pick [between additional discovery and testing the phone], we would rather be allowed to test, inspect, and open the iPhone.” Pl.’s Opposed Admin. Mot. for Leave to File Pl.’s Supp. Mot. to Extend Time to File an Opp’n Brief to Defs.’Mot. for Summ. J. at 2:25–27 (Dkt. No. 295). Apple opposed plaintiff’s initial motion to test the phone because “such ‘testing’ would prove nothing regarding whether [the phone] was new or ‘refurbished’ at the time Plaintiff received it from Apple[,]” and “would be especially futile 28 14 1 given that the iPhone (i) has been subjected to normal wear and tear since Plaintiff received it on 2 July 22, 2013, (ii) has been damaged (cracked screen) by Plaintiff, (iii) may have been subject to 3 unknown third-party repairs, and (iv) has been stored in unknown conditions by Plaintiff’s former 4 counsel.” Defs.’ Opp’n to Pl.’s Second Admin. Mot. Re Extension of Time to Oppose MSJ at 1–2 5 (Dkt. No. 294). English owns the phone, so the “testing” I am asked to authorize is in actuality a command 6 7 that Apple and its experts monitor whatever English wants to do with her phone. I will not order 8 that because I do not see how any “testing” now will show whether the phone was new in 2013. 9 She has had the phone for almost four years, although it was apparently misplaced by her lawyers for one of those years. There is no chain of custody for the phone. It is not at all clear how the 11 United States District Court Northern District of California 10 “testing” that English discusses would prove that her phone was not new when she received it in 12 2013.8 13 The only “testing” that English proposes is akin to a visual examination, which I address 14 below.9 Dkt. No. 298 at 2:7. In addition, she claims that “Thang Huynh also told Kennedy that 15 there is a way to tell if the phone has been opened previously.” Id. Whether the device has been 16 opened before is one thing, but whether the phone was new three years ago is something entirely 17 different. English beseeches the Court to allow her to open up the phone, “take the parts out, test the 18 19 phone, and run standard industry tests on it.” Pl.’s Statement Regarding Testing Pl.’s iPhone at 20 1:15–16 (Dkt. No. 298). She states that “the parts are coded and numbers and letters can help 21 identify whether the phones are refurbished or used.” Id. at 2:5–6. English submits a declaration 22 8 23 24 25 26 27 28 Plaintiff’s own expert report submitted in support of class certification confirms this conclusion: “Electronic parts and products (devices, equipment) are known to wear-out with time, usage conditions and environmental conditions.” Kennedy Decl. in support of Class Certification, Ex. 1 (Pecht Report) (Dkt. No. 189-1) ¶ 23. 9 She also mentions “diagnostic, software and application tests that can be run,” English Decl. ¶ 5 (Dkt. No. 305-15), but never elaborates on this testing. See Dkt. No. 299 at 4:20–22. She references “step-by-step testing instructions.” Id. at 3: 7–8 (citing Dkt. No. 213-13). I do not see, and English does not explain, how the referenced procedures, entitled “iPhone Finished Goods Reclamation Process,” Dkt. No. 213-13, would be used to identify whether the phones English received as replacement units in 2013 were new at the time she received them. 15 1 from her telecommunications expert, Dr. Nettleton, describing the various identifying numbers on 2 which she sought discovery: IMEI, MEID, IMSI, ICCID, HEX, DEC, and serial numbers. 3 Nettleton Decl. ¶¶ 3–15 (Dkt. No. 304-12). But nowhere does she explain how she will use these 4 numbers to prove whether or not her phone was new.10 Apple has stated that “the replacement 5 iPhones and their component parts have no ‘service history’ because they are brand new.” Dkt. 6 No. 289 at 5:7–8. Apple argues that “neither Plaintiff nor her telecommunications expert … 7 provides any basis as to why these numbers are relevant to whether Plaintiff’s replacement iPhones 8 were new.” Reply at 2 n.5 (emphasis in original). In the absence of an explanation of how she 9 would use the numbers to determine whether the phones were new or used, she has not met her 10 burden to show that this information is “essential.” United States District Court Northern District of California 11 Plaintiff proffers “expert” declarations stating that phones can be disassembled and 12 visually inspected for fingerprints, scratches and other marks. Dixon Decl. ¶¶ 9–10 (Dkt. No. 304- 13 16);11 Tapia Decl. ¶ 25 (Dkt. No. 304-17); Huynh Decl. ¶ 5 (Dkt. No. 304-21);12 see also 14 Dalrymple Decl. (Dkt. No. 310-6).13 Apple contends that an iPhone 4 cannot be taken apart 15 10 16 17 18 19 20 21 22 23 24 25 26 As an aside, Lanigan testified that “most IMEI numbers are produced later in the process. The serial number is produced in the beginning of the process.” Lanigan Depo. 226:6–9. In light of this information, I do not see, and English does not explain, how an IMEI number would provide a different or more thorough history than a serial number. 11 Apple moves to strike the Dixon Decl. (Dkt. No. 304-16) and corrected Dixon Decl. (Dkt. No. 310-3) because she is not an expert and has no basis for her testimony. Reply at 4–6 (Dkt. No. 320 [redacted]; 319-3 [under seal]. According to Apple, the Elk Grove facility where Dixon , and the “sole basis for her purported ‘expert’ opinion is the five hours of training she claims she received from Apple and her ‘experience’ during her time at Apple.” Reply at 5; see Lanigan Decl. ¶ 7 (Dkt. No. 208-17[under seal])(noting the type of work done at the Elk Grove facility). Apple also notes that workers at the Elk Grove facility do not open or take apart iPhones. Garbutt Decl. ¶ 5 (Dkt. No. 319-8). Since the evidence indicates that English’s replacement units were new, I find the Dixon declaration minimally relevant and hardly probative, and give it little weight. She is not an expert. I do not, however, find it necessary to strike the declaration. Apple’s motion is DENIED. 12 Apple moves to strike the Huynh Declaration because he is not an expert and his opinion lacks foundation. Reply at 6. As discussed, I agree that Huynh does not provide sufficient details regarding the “testing” or visual examinations he proposes. His declaration need not be stricken, but I consider its deficiencies in deciding whether testing is warranted. 13 27 28 English filed a declaration from a “fingerprint expert” expounding on the process of “fingerprinting.” Dalrymple Decl. (Dkt. No. 310-6). Apple moves to strike the Dalrymple declaration as untimely because plaintiff filed it five days after her deadline to oppose summary judgment. See Order at Dkt. No. 300. Plaintiff does not dispute that the declaration was untimely. 16 1 completely and put back together without compromising the iPhone. Schaeffer Decl. ¶ 3 (Dkt. 2 No. 320-9). I will address each declaration in turn. 3 The Dixon declaration is of little to no value since she , and 4 there is no evidence or argument relating her work to a disposition of whether English’s phone 5 was new when she received it in 2013. Huynh himself states that he “may be able to tell if Ms. 6 English’s phone contains refurbished or used parts.” Huynh Decl. ¶ 4. But an unsupported 7 declaration that he may be able to tell if the phone contains refurbished or used parts is not enough 8 to show “that the facts sought exist.” Campbell, 138 F.3d at 779. And the Tapia declaration, 9 discussed in greater detail in Section III, below, confuses the matter even further, as he states that “Apple also frequently put used or refurbished parts in even their brand new devices.” Tapia Decl. 11 United States District Court Northern District of California 10 ¶ 25. If that is true, and the phone—whether new, used, or remanufactured/refurbished—might 12 contain used or refurbished parts, there would be no purpose in “testing” it. 13 There are several problems with the reliability of any evidence ascertained as a result of a 14 visual inspection. First, the presence of fingerprints (or any other marks) would not mean that the 15 phone was not new when English received it in 2013. Counsel for English avers that she “does 16 not believe that Ms. English’s phone has even been opened.” Id. (emphasis added). Counsel’s 17 “belief” does not establish a foundation. And even if Huynh can determine that the phone has 18 been opened previously, there is not enough evidence to even begin to posit when it may have 19 been opened or by whom. Because a chain of custody has not been established, the origin of any 20 fingerprints (or any other markings) cannot be determined. 21 English’s declaration stating that she, her family members, and third parties have never 22 opened the phone is hardly sufficient to establish a reliable chain of custody either. English 2nd 23 Decl. ¶ 6 (Dkt. No. 304-15). She cannot speak for others, nor does she indicate that the phone was 24 always in her possession (as opposed, for example, to being in her son’s possession). She states 25 that on September 24, 2015, she placed the phone in a plastic bag, handed it to Ms. Kennedy (her 26 lead lawyer) and the next day viewed a photograph emailed by Mr. Parker (one of her other 27 28 See Mot. for Leave to File a Supplemental Mot. ¶ 8 (Dkt. No. 310). Because the declaration was untimely (and is of no value), it is STRICKEN. 17 1 lawyers) to Ms. Kennedy and confirmed that the photograph appeared to be of the same phone that 2 she had handed over to Ms. Kennedy the previous day. Id. ¶¶ 4–5. Then she says that the phone 3 photographed by Mr. Parker on October 15, 2016, more than a year later, appears to be the same 4 phone that she handed to Ms. Kennedy on September 24, 2015. Id. ¶ 6. This is not persuasive. 5 But even if I accept that the phone is the same phone and that the phone has never been opened or 6 tampered with, English still has not demonstrated that there is a way to test the phone to determine 7 whether or not it was new when she received it in 2013. 8 9 While English submits declarations proposing her “fingerprint” theory, she offers no corroborating evidence, such as a refurbished phone containing fingerprints, to bolster its reliability. According to Lanigan, the service units that are remanufactured (as opposed to new 11 United States District Court Northern District of California 10 buy units) come from service factories with few differences from those factories that ship only the 12 latest device. Lanigan Dep. 95–97 (Dkt. No. 304-5); see also Lanigan Decl. ¶ 5 13 (“Remanufactured iPhones are assembled using the same manufacturing process as new iPhones, 14 and could contain both new parts and recovered parts that have been extensively tested. … These 15 iPhones are manufactured by the same contract manufacturers that manufacture the new iPhones 16 Apple sells in its stores, and the production lines on which these iPhones are manufactured are 17 identical to those for new iPhones Apple sells in its stores, and the production lines on which these 18 iPhones are manufactured are identical to those for new iPhones.”) There is no reason to believe 19 that a phone processed in a service factory would contain fingerprints, while a phone processed in 20 another factory would not. 21 Plaintiff insists that “the device may contain the very answers and evidence Plaintiff needs 22 to prove her case.” Id. at 4:16–17. But she never explains how such “answers and evidence” will 23 prove that her phone was refurbished in 2013. Apple has repeatedly opposed plaintiff’s requests 24 for additional time and discovery on the basis that the amount of discovery is grossly 25 disproportionate to plaintiff’s claim, since out of pocket expenses relating to her claim are less 26 than $300. See, e.g., Defs.’s Opp’n to Plaintiff’s Mot. to Extend Time at 1:5-10 (Dkt. No. 292). 27 Because of the implausibility of her theory, the burden on Apple, and the lack of good cause as a 28 result of her delay in seeking this discovery, English is not entitled to additional discovery or an 18 1 opportunity to test the phone under the Court’s auspices. See Garrett v. San Francisco, 818 F.2d 2 1515, 1518 (9th Cir. 1987)(In seeking additional discovery under Rule 56, “an opposing party 3 must make clear what information is sought and how it would preclude summary judgment.”) 4 C. Additional Discovery Related to English’s Claim that she was Denied a Second Incident 5 Apple moved for summary judgment on the issue of whether English was denied a second 6 incident under AC+. See Mot. at 17. English visited the Apple store on February 28, 2014 7 because her iPhone had a cracked screen. TAC ¶ 38. She asserts that when she attempted to use 8 her second incident under AC+, an employee named Ryan told her she had used up both 9 accidental damage incidents under her plan. English 2nd Decl. ¶¶ 10–11. Apple maintains that its business records demonstrate that an employee named Morrison assisted English, and that the 11 United States District Court Northern District of California 10 records indicate that she was not denied an incident, but rather elected to wait for an upgrade 12 opportunity. Mot. at 17. 13 The parties have twice briefed the issue of the employee named “Ryan.” Dkt. Nos. 118, 14 297. Although Morrison admits that there was a male employee by the name of Ryan matching 15 the description provided by English, Morrison Dep. at 196:20 (Dkt. No. 310-10), Apple insists that 16 this employee has no recollection of assisting English. Dkt. No. 118 at 3:18-4:4; Dkt. No. 297 at 17 5:15-22. This does not justify Apple’s withholding Ryan’s identity given that Morrison did not 18 remember assisting English. See Morrison Dep. at 155:25 (Dkt. No. 288-2). But the question is 19 whether Ryan’s deposition is important or necessary to oppose Apple’s motion for summary 20 judgment. Because I find that English fails to state a claim for relief, even assuming she was 21 denied a second incident under AC+, a deposition of Apple employee “Ryan” is unnecessary. See 22 III, below. 23 II. UNDISPUTED EVIDENCE ESTABLISHES APPLE’S MOTION 24 A. Standing 25 1. Injury 26 Apple argues that since English received two new phones under AC+ she has not suffered 27 an injury in fact necessary to satisfy Article III standing for her claims under the CLRA, FAL, 28 UCL, Secondhand Merchandizing Labeling law, and for fraud. Mot. at 9. To have standing, a 19 1 plaintiff must show: (1) an injury-in-fact, i.e., an invasion of a legally protected interest that is (a) 2 concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical; (2) 3 causation, which means her injury is fairly traceable to the challenged conduct of the defendant; 4 and (3) redressability. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561–62 (1992). 5 English claims that her replacement phones were not new, but rather were refurbished, and 6 that she suffered injury by overpaying for AC+ and the replacement iPhones, and losing the 7 iPhone she owned and turned in at the time she purchased AC+. TAC ¶ 30, 57. She contends 8 that, even if the phones she received were new, she suffered an injury because she would not have 9 bought AC+, a replacement device, or turned in her original phone if she knew that there was a chance she would receive a used or refurbished phone as a replacement unit. Opp’n 16 (Dkt. No. 11 United States District Court Northern District of California 10 304-3). She claims the following damages: “the improper denial of an incident under AC+, the 12 loss of a new replacement phone with new parts due to the denied incident, the loss of an extended 13 warranty contract that afforded for only new replacements, the loss of new phones with new parts, 14 the value of her original phone …, her original replacement cost for the first device purchased, the 15 cost of AC+, the cost of the replacement devices (“service fees”), the phones that she had to turn 16 in each time, and attorneys’ fees, costs, and expenses.” Id. at 17. 17 Apple disputes English’s alleged injury because (1) she could not have purchased the Best 18 Buy plan she claims she would have purchased; (2) the Best Buy plan was more expensive; and 19 (3) the Best Buy plan called for refurbished replacement devices. Reply at 14–15. 20 While it may be true that “[a] service that can provide either new or used replacement 21 phones is worth less than a service that provides only new replacement phones[,]” Opp’n at 16, 22 the fact remains that plaintiff received only new replacement phones. She therefore was not 23 “deprived of an agreed-upon benefit … .” Birdsong v. Apple, Inc., 590 F.3d 955, 961 (9th Cir. 24 2009). But English maintains that she “would not have purchased the AC+ plan had she been 25 made aware of its policies, including the nature of replacement devices, the loss of an incident at 26 enrollment, and the fact that she would not receive a full 2-years on her plan.” Id. at 16–17. 27 While issues remain regarding causation, see below, it is at least disputed whether English’s 28 injury-in-fact is the price she paid for AC+ and her replacement units, and whether she would not 20 1 have purchased AC+ if she knew she could receive used or refurbished phones. Mazza v. Am. 2 Honda Motor Co., 666 F.3d 581, 595 (9th Cir. 2012) (finding an injury-in-fact where consumers 3 purchased a product or paid more for it than they otherwise would have paid). 4 2. Causation/Actual Reliance 5 Even if English suffered an injury-in-fact, she must allege causation and redressability for 6 Article III standing. To establish causation, she contends that her injury is “traceable to 7 Defendants’ conduct (i.e., misrepresentations and omissions)… .” Opp’n at 17. Plaintiff faces 8 three problems here. First, she fails to proffer specific evidence of an oral misrepresentation. 9 Second, the undisputed facts prove that she did not read the AC+ terms and conditions, and therefore, could not have relied on them in making her purchase decisions.14 If she did not view or 11 United States District Court Northern District of California 10 rely on the AC+ terms and conditions, then Apple’s alleged written misrepresentations could not 12 have caused her injury. And third, as discussed later, I do not find that Apple’s written 13 representations would be misleading to a reasonable consumer. 14 a. Oral Misrepresentation 15 English contends that the Apple employee who helped her told her that replacement 16 devices would be new. TAC ¶ 36. In her opposition to summary judgment, English fails to 17 directly raise her oral misrepresentation theory and does not offer evidence in support of it. She 18 merely mentions it in passing. Opp’n at 3 (“Apple associates also use the word ‘new’ to describe 19 the devices… .). Although evidence supporting this theory was submitted during the class 20 certification briefing, it hardly helps English here. See Kennedy Decl. in support of Pl.’s Mot. for 21 Class Certification, Ex. 9 (Pozderac Depo.)(Dkt. No. 180-14[sealed]). Nicholas Pozderac, the 22 employee who sold English AC+ in February 2013, testified that—prior to 2012—when customers 23 asked if their replacement devices were refurbished, he told them “[i]t would have been a new 24 device.” Pozderac Dep. at 103:22–104:2. But sometime in early 2012, an interaction with a 25 customer prompted him to look up the AC+ terms and conditions, where he discovered the “new 26 14 27 28 Plaintiff’s argument that she read the Repair terms and conditions, which reference the AC+ terms and conditions, is not helpful. Reading a reference to the AC+ terms and conditions is not equivalent to reading the AC+ terms and conditions. See II.A.1, below. 21 1 and functionally equivalent to new” language. Id. at 101:4–23. English does not submit evidence 2 of the precise language Pozderac used in his interaction with her in February 2013, but one can 3 infer that he may have revised his wording in 2012, after reading Apple’s “official” terminology as 4 documented in the AC+ terms and conditions. Id. at 104:10. Even without giving weight to this 5 reasonable inference that contravenes English’s theory, she fails to meet her burden to proffer the 6 evidence to support her allegations of an oral misrepresentation. In re iPhone Application Litig., 6 7 F. Supp. 3d 1004, 1012 (N.D. Cal. 2013)(“[A]t summary judgment, a plaintiff may no longer rely 8 on ‘mere allegations,’ but rather must set forth ‘specific facts’ supporting standing.”) Accordingly, her allegations of misrepresentation must depend on either the AC+ terms 9 and conditions, which she did not read, or her “unbranded white box” theory. With either theory, 11 United States District Court Northern District of California 10 she must proffer evidence of actual reliance to satisfy standing requirements under the CLRA and 12 UCL, In re iPhone Application Litig., 6 F. Supp. 3d at 1012 – 13, and the FAL, Pfizer Inc. v. 13 Superior Court, 182 Cal. App. 4th 622, 633, 105 Cal. Rptr. 3d 795, 804 (2010), and to state a 14 claim for common law fraud, Lazar v. Super. Ct, 12 Cal. 4th 631, 638 (1996). 15 b. Never Viewed or Relied on AC+ Terms and Conditions In the order denying class certification, I found “it is undisputed that English did not view 16 17 or rely on the AC+ terms and conditions in making her purchase,” and so she “cannot bring claims 18 under the CLRA, FAL, or UCL, or for fraud, based on misrepresentations she was not exposed to 19 and did not rely on in making her purchase.” Class Certification Order at 20:10–13 (Dkt. No. 20 225)(citing Cohen v. DIRECTV, Inc., 178 Cal. App. 4th 966, 980 (2009); Pfizer Inc. v. Superior 21 Court, 182 Cal. App. 4th 622, 634 (2010)). Plaintiff admits she never read the AC+ terms and 22 conditions. Opp’n at 19; English 2nd Decl. ¶ 14. But she argues that she did not have to view the 23 AC+ terms and conditions because the Repair terms and conditions reference the AC+ terms and 24 conditions, and this is not the only basis of misrepresentation.15 Opp’n at 19. Lastly, she argues 25 misrepresentation in “Apple’s overall sales strategy and its failure to adequately disclose its 26 27 28 15 She also asserts oral misrepresentations, which I addressed above, and misrepresentations in the “plain white box” theory, which I address below. 22 1 replacement policy.” Id. “To survive a standing challenge at summary judgment, Plaintiffs must 2 be able to provide some evidence that they saw one or more of Apple's alleged misrepresentations, 3 that they actually relied on those misrepresentations, and that they were harmed thereby.” In re 4 iPhone Application Litig., 6 F. Supp. 3d at 1027. 5 The Repair terms and conditions state: 6 When the product is covered by warranty or an extended service contract, such as AppleCare Protection Plan, Apple will perform repairs under the terms of the warranty or the extended service contract, provided that you have presented satisfactory proof of the product’s eligibility for such repairs. 7 8 English 2nd Decl. ¶ 14 (Dkt. No. 304-15). I do not see how reading the above cited language 10 establishes that the AC+ terms and conditions included a representation that consumers would 11 United States District Court Northern District of California 9 only receive new phones under the terms of the extended service contract. Since English is unable 12 to meet this “far from unreasonable” burden, In re iPhone Application Litig., 6 F. Supp. 3d at 13 1027, to demonstrate that she saw and relied on an alleged misrepresentation in the AC+ terms and 14 conditions, she lacks standing under this theory, and Apple is entitled to summary judgment of 15 those claims that depend on an affirmative misrepresentation. See id. at 1013 (“California courts 16 have held that when the ‘unfair competition’ underlying a plaintiff's UCL claim consists of a 17 defendant's misrepresentation, a plaintiff must have actually relied on the misrepresentation, and 18 suffered economic injury as a result of that reliance, in order to have standing to sue.”) To the extent English claims that her injury was caused by an omission on Apple’s part, 19 20 she fares no better. I previously rejected her omission theory in part because she “did not view or 21 rely on the terms and conditions in making her purchase… .” Class Certification Order at 22. 22 Moreover, “to be actionable the omission must be contrary to a representation actually made by 23 the defendant… .” Daugherty v. Am. Honda Motor Co., 144 Cal. App. 4th 824, 835 (2006). The 24 AC+ terms and conditions state that the phones would be “new or equivalent to new in 25 performance and reliability.” TAC Ex. B (Dkt. No. 139-2); TAC Ex. C (Dkt. No. 139-3). English 26 cannot show any omission that is contrary to this representation.16 27 16 28 English’s argument that “Apple’s misrepresentations and omissions … fail[] to make consumers aware of the [AC+] plan’s true length calculated by the personal device brought in by the consmer 23 c. Plain White Box Theory 1 2 3 4 5 6 Plaintiff also asserts a theory of misrepresentation that depends on the context of Apple’s entire sales strategy.17 She points to the presentation of the replacement unit in a sealed plain white box and a plastic film on the device as creating “an overall impression on a consumer that the device is new.” Opp’n at 20. Apple argues that a plain white box is not a representation because “[w]hen a customer purchases a new iPhone, it comes in an Apple-branded box that contains the iPhone itself, along with accessories including an iPhone charger and headphones.” 7 Mot. 15; Healy Decl. 13 (Dkt. No. 209-32). In an AC+ transaction, the iPhone does not come in 8 an Apple-branded box, the consumer does not receive any accessories, and the consumer does not 9 keep the box. Mot. at 15–16. 10 English acknowledges these differences, although she claims they are minor. Opp’n at 21; 11 United States District Court Northern District of California Dkt. No. 213-14 at 14-15; 233-43 at 3. She even points out additional differences—there is more 12 13 14 color on new boxes and one is slightly larger. Opp’n at 21. Given the numerous differences, which she acknowledges, plaintiff’s plain white box theory is unconvincing. Even if the plain white box was a representation, English still presents no evidence that she relied on it.18 15 16 17 18 19 20 21 22 23 24 [sic] at the initial purchase of AC+” suffers from the same deficiency. Opp’n at iii; see also id. at 15. The AppleCare+ Certificate emailed to her son at the time she purchased AC+ explicitly states “AppleCare+ extends service coverage to 24 months from the purchase date of your Apple product… .” Patel Decl. ISO Defs.’ Opp’n to Class Certification Ex. C (Dkt. Nos. 209-4, 2088[redacted]; Dkt. No. 208-7[under seal]). And further, “[i]f you purchased AppleCare+ in conjunction with a service transaction, your coverage end date remains 24 months from the date you purchased your Apple product.” Id. Moreover, the certificate clearly discloses the “Coverage Period End Date” as September 25, 2014—two years from the date she purchased the original phone, not the AC+ service plan. Id. I find these disclosures adequate to put a reasonable consumer on notice of the coverage period end date. Therefore, Apple’s training materials stating “two replacements are available for up to 2 years,” Kennedy Decl. Ex. 14 (Dkt. No. 18019)(emphasis added), would not be misleading to a reasonable consumer given Apple’s affirmative representations. Further, the same training materials explicitly state, “[b]ecause [AC+] protects the device for two years from the original purchase date, customers get the most out of [AC+] when they buy it with their device.” Id. at 5. All of the evidence demonstrates that this theory of misrepresentation is baseless. 17 25 It is worth noting that her arguments surrounding the plain white box theory have been inconsistent. See Reply at 10. 26 18 27 28 In this vein, English identifies the Smart Signs and claims that “[t]he box that represents what an iPhone 4s a [sic] service unit (“replacement device”) looks like on a Smart Sign depicts a service unit box as a branded box with a logo.” Opp’n at 21. She then states, “[w]hen Ms. English purchased she would have seen a logo branded box.” Id. This allegation comes closer to an actual misrepresentation. But, even still, English has not demonstrated that she actually relied 24 1 Moreover, the fact remains that her replacement phones were new. As I stated in denying class 2 certification, “English does not explain how she can establish standing with respect to a theory 3 based on Apple’s allegedly improper packaging of refurbished replacement iPhones if she 4 received only new replacement iPhones.” Order Denying Motion for Class Certification at 14 5 (Dkt. No. 226). 6 B. Even if Plaintiff Adequately Alleged Reliance, She Can Not Meet the Reasonable Consumer Standard 7 For plaintiff to assert claims under the CLRA, FAL, UCL and for common law fraud, she 9 must meet the “reasonable consumer standard,” which requires a “show[ing] that members of the 10 public are likely to be deceived.” Freeman v. Time, Inc., 68 F.3d 285, 288 (9th Cir. 1995)(internal 11 United States District Court Northern District of California 8 quotation marks and citation omitted). “The California Supreme Court has recognized that these 12 laws prohibit not only advertising which is false, but also advertising which [,] although true, is 13 either actually misleading or which has a capacity, likelihood or tendency to deceive or confuse 14 the public.” Williams v. Gerber Prod. Co., 552 F.3d 934, 938 (9th Cir. 2008). “Surveys and 15 expert testimony regarding consumer assumptions and expectations may be offered but are not 16 required; anecdotal evidence may suffice, although ‘a few isolated examples’ of actual deception 17 are insufficient.” Clemens v. DaimlerChrysler Corp., 534 F.3d 1017, 1026 (9th Cir. 2008). 18 English points to “[a] plethora of call logs” that “show that many reasonable consumers 19 were deceived.” Opp’n at 22; see Kennedy Decl. Ex. B (Dkt. No. 180). She also recites Apple’s 20 terminology to refer to this “ceremonious presentation of the service units,” as “polishing the 21 Apple.” Opp’n at 22 (citing Williams Dep. 215:22-216:1 (Dkt. No. 180-16)). At least some of the 22 call logs provide proof that some consumers believed that they would receive new iPhones under 23 AC+. See Call Logs (Dkt. Nos. 304-6–304-8). But there is no evidence that these consumers’ 24 expectations under AC+ was in any way connected to receiving their replacement units in a plain 25 white box. Even if I simply accepted English’s theory, she still has not alleged that she—nor any 26 27 28 on the Smart Sign images. Moreover, Apple explains that the photos English identifies as misleading are actually of Apple-branded boxes for new iPhones. Reply at 11 (citing Dkt. No. 233-43 at 3, 18). 25 1 of the customers in the call logs—relied on the plain white box as an affirmative 2 misrepresentation. Her claims still fail on this ground. In the absence of any evidence that English relied on any misrepresentations by Apple, she 3 has not shown that her injury of purchasing AC+ was caused by Apple. She received a new 5 phone. And her omission theory fails because Apple adequately discloses the terms of AC+, she 6 just failed to read them. “AC+ terms and conditions clearly state that replacement iPhones will be 7 ‘new or equivalent to new in performance and reliability,’ and therefore not necessarily new.” 8 Mot. at 12 n.4. A plaintiff asserting claims for fraudulent misrepresentation must show a specific 9 misrepresentation that she actually relied on. Baltazar v. Apple, Inc., No. CV-10-3231-JF, 2011 10 WL 588209, at *3 (N.D. Cal. Feb. 10, 2011). Under any theory supported by evidence, English’s 11 United States District Court Northern District of California 4 injury was not caused by Apple, and she therefore lacks standing to pursue her misrepresentation 12 claims. 13 C. Secondhand Merchandise Labeling Law Claim 14 15 16 17 18 19 20 The Secondhand Merchandise Labeling Law states: It is unlawful for any person, firm, or corporation ... to advertise, call attention to or give publicity to the sale of any merchandise, which merchandise is secondhand or used merchandise, or which merchandise is defective in any manner, or which merchandise consists of articles or units or parts known as “seconds,” ... unless there is conspicuously displayed directly in connection with the name and description of that merchandise and each specified article, unit, or part thereof, a direct and unequivocal statement, phrase, or word which will clearly indicate that the merchandise or each article, unit, or part thereof so advertised is secondhand, used, defective[.] 21 Cal. Bus. & Prof. Code § 17531. There is no genuine issue whether the phones English received 22 were new. The Secondhand Merchandise Labeling Law does not apply. Apple’s motion for 23 summary judgment of this claim is GRANTED. 24 III. THE DENIAL OF A SECOND INCIDENT, IF IT OCCURRED, FAILS TO CREATE A MATERIAL DISPUTE BECAUSE THERE IS NO EVIDENCE OF FRAUDULENT INTENT 25 26 Let’s assume, as English hopes, that the Apple employee named Ryan would remember 27 her, their conversation nearly three years ago, and that when he looked up her information, it 28 showed that she didn’t have any incidents left, despite the note to the contrary written by 26 1 Morrison.19 That might establish a breach of contract claim if Apple failed to provide English 2 with two incidents, in addition to the “incident” at the time she purchased AC+. But English does 3 not assert that claim. Instead, she alleges claims based on fraud under the UCL, CLRA, FAL and 4 common law, none of which reference the purported denial of a second incident. See TAC ¶¶ 73– 5 127. Both parties dedicated significant portions of their briefing to the issue of whether plaintiff 6 was denied a second incident, and yet neither party has identified to which claims the issue relates. 7 See Mot. at 17–19; Opp’n at 10–15; Reply at 12–13. Rather than supporting an element of her 8 fraud-based claims, the denial of a second incident seems to go towards English’s purported 9 damages. See Opp’n at 17. Although this case has been pending since 2014, English has 10 proffered no evidence of fraud. Apple’s records, prepared by employee Morrison, state that English: “decided to wait for United States District Court Northern District of California 11 12 an upgrade in may [sic]20 before getting a new phone[.] Resolution: Ownership Opportunity[.] 13 Reason: Future Purchase[.]” O’Neil Decl., Dkt. No. 208-23 at APL00000597 [sealed]; Dkt. No. 14 209-37 at APL00000597 [redacted]. Morrison testified that his notes from the transaction meant 15 English “ha[d] the option of purchasing another product as opposed to doing a service transaction 16 through the Genius Bar,” and she “chose not to use the Genius Bar to get another phone, but, 17 instead, to wait for her upgrade, which, to me, I would describe as an ownership opportunity.” 18 Patel MSJ Decl. Ex. 1 (Morrison Dep.) at 166:5–9, 14–17. 19 English counters with a declaration from former Apple employee Gabriel Tapia, who has 20 no personal knowledge about the way Apple responded to her second incident. But he interprets 21 Apple’s records to conclude that they “validate that Ms. English indeed lost an incident.” I do not 22 19 23 This is the evidence Ms. Kennedy suggested Ryan might provide when I asked for an offer of proof at the hearing on this motion. It seems unlikely that Ryan would testify in this way. 24 20 25 26 27 28 Both parties accept that “may” does not accurately reflect when English would be eligible for an upgrade, as she was not eligible for an upgrade until around September 26, 2014 (two years following the purchase of her “original” device). But neither party discusses whether the employee who took the notes (whether it was Morrison or Ryan) mistakenly wrote “may” or was told by English that she would be eligible in May. If it was a mistake, that’s one thing, but if English represented and believed that she would be eligible for an upgrade in May, then the theory of her waiting eight weeks and foregoing the $49 service fee is more plausible than her deciding to wait eight months for an upgrade. 27 1 think that the records require “expert” interpretation—the author of the note has explained what he 2 meant. See id. Tapia, who worked at Apple for seven years and helped work on the 3 MobileGenius, an application used by Apple employees on the floor to assist customers, said that 4 the loss of an incident happened at all the New York stores where he worked. Opp’n at 10 5 (quoting Tapia Decl. at Dkt. No. 304-17[under seal]);21 Tapia Decl. ¶ 4 (Dkt. No. 304-17). He 6 states, “[w]hen processing a repair in MobileGenius or iRepair, an icon would appear if the phone 7 was purchased with AppleCare+. When all AppleCare incidents were consumed, the plus sign 8 would turn to a red logo.” Id. ¶ 10. Tapia reviewed the records from English’s February 28, 2014 9 interaction and reported that “ 10 did not have AppleCare+ coverage available. Id. ¶ 14. English highlights the record notes to bolster her position: 11 United States District Court Northern District of California ” meant that the phone 12 13 ” Opp’n at 10 (quoting Dkt. No. 232-12)22. Apple counters that this 14 description “mean[t] that there [was] accidental damage, and does not provide any information 15 regarding whether the iPhone is covered under AC+.” Reply at 13. Apple contends that “ could fall under AC+, or it could fall outside AC+[,]” and that English’s 16 17 “interpretation of [the] records … does not create a genuine dispute of material fact.” Id. at 12– 18 13. English claims that the interpretation that she elected to forego an incident under AC+ to wait 19 for her upcoming upgrade does not make sense since she did not upgrade until eight months later 20 on October 18, 2014 and had to operate with a cracked screen until then.23 Id. at 11. She also 21 highlights Apple’s own evidence that “this AC+ program [allowing enrollment ‘at time of 22 21 23 24 25 26 Numerous Tapia declarations have been filed in this case. See Dkt. Nos. 233-29[redacted], 2654[sealed] (mistakenly labeled as 265-5), 180-7[sealed], 214-26[sealed]. A version of this declaration was previously sealed by the court. Dkt. No. 285. Defendants filed a redacted version at Dkt. No. 286. In the Order Denying Motion for Reconsideration, I found that the declaration labeled as exhibit 13N was “too conclusory and speculative to materially impact the analysis in the Class Certification Order.” Dkt. No. 263 at 7 n.7. In this Order, I consider his declaration only as it relates to English and Apple’s records of English’s transaction. 22 This exhibit was previously sealed by the court. Dkt. No. 285. 23 See supra note 9. 27 28 28 1 incident’] had the highest number of incidents utilized compared with any other AC+ program.” 2 Id. at 12 (citing Healy Decl. (Dkt. No. 209-32 at 22:27)). And lastly, she points to Apple’s own 3 training material in an unsuccessful attempt to bolster her position. See Opp’n at 10. The training 4 material states that sometimes an “ownership opportunity,” i.e., an opportunity to buy a new 5 phone, is a better option for a customer than receiving a replacement unit through AC+. Opp’n at 6 10 (citing Dkt. No. 180-19 at 9[under seal]). None of this is relevant to whether English was 7 denied a second incident. If there is a genuine dispute whether English was denied a second incident, it does not 8 9 create a dispute regarding any fraud or misrepresentation, both of which require intent. According to Apple, its policy, training materials, and customer records “establish that customers who, like 11 United States District Court Northern District of California 10 Plaintiff, purchased AC+ at the time of an out-of-warranty repair did in fact receive coverage for 12 two incidents of accidental damage in addition to the initial out-of-date warranty repair.” Mot. at 13 18. To counter Apple’s contentions, English points to the name of the program (“AppleCare+ 14 Enroll at Time of Incident”), the same training materials, and the statistics behind the number of 15 customers who purchased AC+ at the time of incident and allegedly used both incidents. She does 16 not suggest how Ryan’s alleged failure to provide a second incident was fraudulent, and she 17 therefore has not shown how the issue of whether she was denied a second incident is material to 18 any of her claims in this case. 19 IV. ADMINISTRATIVE MOTIONS24 On January 27, 2015, this court signed a stipulated Protective Order in this case. Dkt. No. 20 21 127. To abide by this protective order, plaintiff filed an administrative motion to file certain 22 documents under seal, Dkt. No. 304, and “corrected” exhibits, Dkt. No. 306. Plaintiff also 23 introduces some exhibits via declaration at Dkt. No. 310. “Plaintiff takes no position … but 24 wishes to give defendants every opportunity to request that the documents be sealed.” Admin. 25 Mot. ¶ 3, see also Kennedy Decl. ¶ 5 (Dkt. No. 304-1). Given that plaintiff seeks only to abide by 26 the protective order, I will focus on defendants’ responses to plaintiff’s motions. 27 24 28 Plaintiff’s motions at 304 and 310 are addressed in the table. Plaintiff’s motion at 314 is TERMINATED AS MOOT. Defendants’ motion at 319 is addressed in the table. 29 1 Some documents filed by plaintiff were previously sealed, which is indicated in the table 2 below. For ease of reference, documents are ordered by ECF number. Apple submitted the 3 declaration of Pami Vyas in support of sealing, which states that plaintiff’s opposition and 4 supporting exhibits contains: “(i) confidential information regarding Apple’s testing processes, (ii) 5 confidential information regarding Apple’s sales and service numbers, and (iii) confidential 6 information regarding Apple’s databases and data capabilities.” Vyas Decl. ¶ 2 (Dkt. No. 315-1). 7 Apple filed a motion to seal portions of its reply, Dkt. No. 319, supported by the Vyas 8 declaration at Dkt. No. 319-1. For the most part, I find Apple’s requests specific and narrowly 9 tailored to cover only highly confidential information. Apple’s specific and narrowly tailored requests to seal information pertaining to its testing processes and procedures, sales and services 11 United States District Court Northern District of California 10 numbers, and databases are GRANTED as indicated in the table below. 12 However, I am unsealing a portion of Apple’s business records pertaining to English that I 13 previously sealed because I do not find that Apple has established compelling reasons to seal the 14 text entry. The request to seal all references 15 16 .” is DENIED. In addition, I plan to unredact this Order in its entirety and to unseal all 17 general information related to the type of devices used as replacement units. There is no 18 compelling reason to redact any of it. But because I previously granted requests to seal this 19 information, if Apple disagrees it should respond within seven days with compelling reasons why 20 any reference in this Order should remain under seal. 21 I otherwise rule on the motions as follows: 22 23 24 25 26 27 28 Dkt. No. 315 Defs.’ Response to Pl.’s Administrative Mot. to File Certain Documents Under Seal ECF No. Ex. No. ECF No. of Document Court’s Ruling Previously Sealed Ex. 304-3 N/A N/A Pl.’s Opp’n to Defs.’ GRANTED IN Mot. for Summ. J. PART DENIED AS Portions to be sealed: TO 10:23.5 9:11–13; 10:23.5; 30 1 2 304-4 N/A N/A 304-5 Ex. A 256-7 304-6 304-7 304-8 304-9 306-1 Ex. B-1 Ex. B-2 Ex. B-3 Ex. C N/A N/A N/A 256-28 304-10 306-2 Ex. D 256-30 304-13 Ex. G 11:24; 22:16–17 Renee Kennedy Decl. Michael Lanigan Dep. excerpts N/A 3 4 5 6 GCRM records GCRM records GCRM records Training – Enrolling in AC+ at the Time of Incident on an iPad Training – Enrolling in AC+ at the Time of Incident on an iPod Apple’s Highly Confidential Responses to ROG Nos. 3, 5, 10-12, 1824, 29(a), 30-34, 39 in Pl.’s First Am. Interrogatories, Set Six 7 8 9 10 United States District Court Northern District of California 11 12 13 14 15 16 17 18 19 20 304-15 Ex. J N/A 304-16 304-17 Ex. M Ex. N 304-18 Ex. ) N/A Same information sealed in previous versions of Tapia Declarations (Dkt. Nos. 22321, 225, 253-3, 285). N/A 304-19 Ex. P 256-32 21 22 23 24 25 26 27 28 31 DENIED GRANTED (previously sealed) DENIED DENIED DENIED GRANTED (previously sealed) GRANTED (previously sealed) GRANTED Portions to be sealed: 5:4–7; 6:8–11; 14:21; 18:13–16; 19:14–19, 21–25, 27–28; 20:1– 4 Fabrienne English DENIED Decls. Bathena Dixon Decl. DENIED Gabriel Tapia Decl. GRANTED IN PART; Portions to be sealed: DENIED IN 5:11, 15.5; 7:9.5–12 PART (5:11, 15.5) Salvador Toledo Depo. Excerpts Training – AC+ within 30 days DENIED GRANTED (previously sealed) 304-20 Ex. Q 3 304-21 310-2 Ex. R “Ex. A”25 N/A N/A 4 310-9 Ex. L Training – AC+ Processing an AppleCare+ Repair Thang Huynh Decl. Bathena Dixon “Corrected” Decl. Kenneth Morrison Depo. Excerpts 256-36 N/A 1 2 5 6 Dkt. No. 319 Defs.’ Mot. to Seal Portions of Their Reply Filings in support of Summ. J. 320 N/A N/A Apple’s Reply GRANTED (previously sealed) DENIED DENIED DENIED DENIED 7 Portions to be sealed: 4:16; 5:3–6, 8, 23– 24; 13:4–6, 8 Mitch Garbutt Decl. 8 9 320-8 N/A N/A GRANTED 10 Portions to be sealed: 1:10 Kenneth Morrison Dep. excerpts United States District Court Northern District of California 11 12 320-5 Ex. D 13 167:11, 18, 21, 23; 168:8, 16–21 14 GRANTED IN PART DENIED AS TO 167:11, 18, 21, 23 CONCLUSION 15 I GRANT Apple’s motion for summary judgment in full and will enter judgment 16 17 accordingly. English has failed to raise a disputed issue whether she relied on an affirmative 18 misrepresentation made by defendants, dooming her CLRA, FAL, UCL, and common law fraud 19 claims. Her claim under Secondhand Merchandise Labeling Law claim fails because there is no 20 dispute that she received new phones. Her request for further discovery lacks good cause and is 21 DENIED. IT IS SO ORDERED. 22 23 Dated: January 11, 2017 ______________________________________ WILLIAM H. ORRICK United States District Judge 24 25 26 25 27 28 This declaration is labeled as Exhibit A to a different Kennedy declaration entitled, “Declaration in Support of Plaintiff’s Motion for Leave to File a Supplemental Motion to Seal and Also Leave to File Bathena Dixon’s Corrected Declaration, Brian Dalrymple’s Declaration, and Ex. L ISO Opposition to Summary Judgment.” Dkt. No. 310-1. 32

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