Michael Gonzales v. Uber Technologies, Inc. et al

Filing 57

ORDER RE MOTION FOR RECONSIDERATION. Signed by Magistrate Judge Jacqueline Scott Corley on 6/21/2018. (ahm, COURT STAFF) (Filed on 6/21/2018)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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MICHAEL GONZALES,
Plaintiff,

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UBER TECHNOLOGIES, INC., et al.,

Re: Dkt. No. 52

Defendants.

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United States District Court
Northern District of California

ORDER RE MOTION FOR
RECONSIDERATION

v.

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Case No.17-cv-02264-JSC

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Plaintiff Michael Gonzales brings this action on his own behalf and as a putative class

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action for Lyft drivers whose electronic communications and whereabouts were allegedly

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intercepted, accessed, monitored, and/or transmitted by the Uber defendants. The Court granted

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Uber’s motion to dismiss the First Amended Complaint on all causes of action except the

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California Unfair Competition Law (“UCL”) claim. (Dkt. No. 51.) The Court denied dismissal of

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the UCL claim on the grounds that Plaintiff had sufficiently alleged UCL statutory standing. (Id.

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at 17-18.) As the Court neglected to address Uber’s additional UCL argument that Plaintiff did

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not sufficiently plead standing to pursue injunctive relief nor plead facts showing that he is entitled

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to restitution, the Court granted Uber leave to file a motion for reconsideration. Now pending

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before the Court is Uber’s motion for reconsideration of the Court’s Order regarding the UCL

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claim. (Dkt. No. 52.) Having carefully reviewed the parties’ briefing, the Court GRANTS

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Uber’s motion with leave to amend. Plaintiff has not alleged facts sufficient to plausibly show

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standing to pursue injunctive relief or that he had an interest in money or property that Uber took

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and thus should restore to Plaintiff.

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DISCUSSION

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Uber argues Plaintiff cannot seek injunctive relief under the UCL because “he has not

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alleged ongoing conduct and he cannot seek restitution under the UCL because his claim is one for

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damages, not restitution.” (Dkt. No. 52 at 2:8-9.)
B.

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“[W]here, as here, [Plaintiffs] seek declaratory and injunctive relief, they must demonstrate

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that they are ‘realistically threatened by a repetition of the violation.’” Gest v. Bradbury, 443 F.3d

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1177, 1181 (9th Cir. 2006) (quoting Armstrong v. Davis, 275 F.3d 849, 860–61 (9th Cir. 2001)

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(emphasis in original). “Standing must be shown with respect to each form of relief sought,” and

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a plaintiff seeking injunctive relief “must demonstrate that he has suffered or is threatened with a

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United States District Court
Northern District of California

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concrete and particularized legal harm, coupled with ‘a sufficient likelihood that he will again be

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wronged in a similar way.’” Bates v. United Parcel Serv., Inc., 511 F.3d 974, 985 (9th Cir. 2007)

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(citations and internal quotation marks omitted).

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Injunctive Relief

Plaintiff has not alleged facts that plausibly suggest that he faces a significant likelihood of

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“real and immediate threat of repeated injury.” Bates, 511 F.3d at 985. Plaintiff alleges Uber

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secretly used the spyware starting in 2014 and into 2016, Dkt. No. 34 ¶ 52; however there is no

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allegation that Uber continued to the spyware after 2016. Further, Plaintiff alleged he stopped

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driving for Lyft in November 2014, Dkt. No. 55 ¶ 19; therefore, even if Uber were to redeploy the

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spyware Plaintiff would not face a real threat of repeated injury unless he drives for Lyft again,

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which he has not alleged he intends to do.

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Plaintiff’s arguments to the contrary are unpersuasive. First, he contends that

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“Defendants’ retention of Plaintiff’s personal and private data and their lack of assurance of its

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destruction threatens continual injury to Plaintiff.” (Dkt. No. 54 at 3:11-12.) However, Plaintiff

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has not alleged facts that plausibly suggest he is injured by Uber’s retention of his more than

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three-year old geolocation history. Remijas v. Neiman Marcus, LLC, 794 F.3d 688 (7th Cir. 2015)

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is inapposite as there the data breach involved data that could be used to make fraudulent charges

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or assume consumers’ identities. Id. at 693-94. No similar allegations about data are made here.

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Second, Plaintiff relies on Davidson v. Kimberly-Clark Corp., 873 F.3d 1103 (9th Cir.
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2017) to argue that he has standing even though Uber ceased using the spyware. That decision

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was amended and superseded by Davidson v. Kimberly-Clark Corporation, 889 F.3d 956 (9th Cir.

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May 9, 2018). There the court concluded the plaintiff had standing even though she was already

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aware of the deceptive product advertising because she pled that she “continues to desire to

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purchase” the product. Id. at 970. Here, Plaintiff has not alleged a desire to drive for Lyft in the

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future; thus, even if Uber were to use the spyware it would not harm Plaintiff. Plaintiff’s reliance

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on People v. Overstock.com, Inc., 12 Cal.App.5th 1064, 1091 (2017) is unpersuasive for the same

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reason: presumably the plaintiff could and would purchase from Overstock.com again. Here there

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are no allegations that suggest Plaintiff would drive for Lyft again.
Accordingly, Plaintiff has not alleged sufficient facts to support his standing to seek

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United States District Court
Northern District of California

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injunctive relief because he has not alleged facts that plausibly suggest “a sufficient likelihood that

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he will again be wronged in a similar way.” Bates, 511 F.3d at 985. As it is not apparent that the

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pleading deficiency cannot be cured by amendment, the injunctive relief claim is dismissed with

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leave to amend.

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B.

Monetary Relief

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A plaintiff may not recover money damages under the UCL, but may recover restitution.

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Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134, 1148 (2003). Restitution “is

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confined to restoration of any interest in ‘money or property, real or personal, which may have

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been acquired by means of ... unfair competition.’” Kwikset Corp. v. Superior Court, 51 Cal.4th

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310, 336 (2011) (quoting Cal. Bus. & Prof. Code § 17203). “[A]n order for restitution is one

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‘compelling a UCL defendant to return money obtained through an unfair business practice to

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those persons in interest from whom the property was taken, that is, to persons who had an

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ownership interest in the property or those claiming through that person.’ The object of restitution

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is to restore the status quo by returning to the plaintiff funds in which he or she has an ownership

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interest.” Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134, 1149 (2003). Uber

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contends that Plaintiff has not pled that he had an interest in any money that Uber acquired and

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thus should be restored to Plaintiff. The Court agrees.

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Uber’s alleged use of the spyware was a lost profit opportunity for Lyft, and thus for
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Plaintiff, but not a benefit that Plaintiff had an ownership interest in. Plaintiff only alleges that

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Uber’s use of the spyware decreased the effectiveness of the Lyft app by decreasing the

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availability of Lyft drivers which in turn harmed Plaintiff and the other class members. (Dkt. No.

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34 ¶¶ 101-102.) This allegation is one of classic money damages, not restitution. Plaintiff’s

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citation to Fladeboe v. Am. Isuzu Motors, Inc., 150 Cal.App.4th 42 (2007) is unhelpful. There, the

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defendant made misrepresentations to the plaintiff to take money that did not belong to the

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defendant. The trial court therefore found that the defendant owed restitution to the plaintiff. Id.

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at 68 (the trial court “correctly and wisely ordered [the defendant] to return the money it obtained

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from [the plaintiff] through that unfair business practice.”) Here, in contrast, Plaintiff has not
alleged Uber falsely represented itself to and took money from Plaintiff; instead, Plaintiff alleges

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United States District Court
Northern District of California

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that Uber’s unfair business practice decreased the effectiveness of the Lyft app which harmed

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Plaintiff, presumably because Plaintiff received fewer ride requests. Fladeboe is not applicable.
CONCLUSION

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The Court’s previous order did not address Plaintiff’s standing to obtain injunctive relief or

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whether he had sufficiently alleged entitlement to restitution; instead, the order addressed only

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statutory standing under the UCL. See Kwikset Corp., 51 Cal. 4th at 335-36 (“the standards for

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establishing standing under section 17204 and eligibility for restitution under section 17203 are

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wholly distinct”). For the reasons described above, Uber’s motion for reconsideration is

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GRANTED. Plaintiff’s UCL claim is dismissed with leave to amend. Plaintiff shall file an

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amended complaint, if any, by July 18, 2018.

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This Order disposes of Docket No. 52.

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IT IS SO ORDERED.

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Dated: June 21, 2018

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JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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