Holden v. Fluent, Inc.
Filing
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ORDER by Judge Joseph C. Spero granting 17 Motion to Dismiss with leave to amend. Plaintiffs' second amended complaint shall be filed no later than December 21, 2020. (jcslc1S, COURT STAFF) (Filed on 11/20/2020)
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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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COQUESE HOLDEN, et al.,
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Case No. 20-cv-03816-JCS
Plaintiffs,
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v.
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FLUENT, INC., et al.,
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Defendants.
United States District Court
Northern District of California
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ORDER GRANTING MOTION TO
DISMISS FIRST AMENDED
COMPLAINT UNDER RULE 12(B)(6)
OR, IN THE ALTERNATIVE, FOR A
MORE DEFINITE STATEMENT
UNDER RULE 12(E)
Re: Dkt. No. 17
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I.
INTRODUCTION
This action was removed from San Mateo County Superior Court on the basis of diversity
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jurisdiction. See Notice of Removal (dkt. 1). In the First Amended Complaint, dkt. no. 15
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(“FAC”), Plaintiffs Coquese Holden and ten other individuals name as defendants Fluent, Inc. and
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Fluent, LLC (collectively, “Fluent”), as well as fifty individuals identified only as Does 1–50.
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Plaintiffs assert three state law claims against Fluent based on “at least 1,300 emails” (“the
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emails”) they allegedly received from Fluent. Presently before the Court is Fluent’s Motion to
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Dismiss First Amended Complaint Under Rule 12(b)(6) Or, In The Alternative, For a More
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Definite Statement Under Rule 12(e) (“Motion”). The Court held a hearing on the Motion on
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November 20, 2020. For the reasons set forth below, Fluent’s Motion is GRANTED.1
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The parties have consented to the jurisdiction of the undersigned magistrate judge pursuant to 28
U.S.C. § 636(c).
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II.
BACKGROUND
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A.
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Plaintiffs Coquese Holden, Kristy Fontes, Stephanie Heller, Lashana Grant, Bryan Hilliard,
Allegations in First Amended Complaint2
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Steven Hoffer, Diedre Love, Angela Johnson, Noah Meiner, Nace Reynold, and Juanita Williams
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allege that they were citizens of California and domiciled in California at the time that they
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received the emails that are the basis of their claims. FAC ¶¶ 12–22. They further allege that
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they accessed the emails from California. Id. According to Plaintiffs, Defendant Fluent Inc. is “a
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business entity . . . and is now, and was at all relevant times, a Delaware corporation with a
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primary place of business in New York, New York doing business and soliciting California
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residents using unlawful email practices.” Id. ¶ 23.3
Plaintiffs allege that Fluent sends “unsolicited spam emails to individuals baiting them
United States District Court
Northern District of California
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with free offerings in exchange for inputting personal information” that it then sells to other
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parties. Id. ¶ 3. According to Plaintiffs, Fluent never provides the free “offering” but “continues
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to obtain more [and] more information until the consumer gives up on their pursuit of the free
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offer.” Id. ¶ 4. Plaintiffs allege that the emails Fluent sends are “unsolicited commercial email
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advertisements,” id. ¶ 7, and that they are “unlawful because they are materially false and
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deceptive, by inclusion of third parties’ domain names without permission by the third parties,
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and/or materially falsified/misrepresented information in the email headers[.]” Id. ¶ 33.
Plaintiffs allege that Fluent “advertised in, sent, and/or conspired to send [Plaintiffs] at
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least one thousand and three hundred (1,300) unlawful spam” emails. FAC ¶ 31. According to
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Because a plaintiff’s factual allegations are generally taken as true in resolving a motion to
dismiss under Rule 12(b)(6), this order summarizes Plaintiffs’ allegations as if true. See Parks
Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). Nothing in this order should be
construed as resolving any issues of fact that might be disputed at a later stage of the case.
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The FAC does not contain any separate factual allegations about the second defendant, Fluent
LLC, which was added after the case was removed to federal court. Rather, it treats the two
defendants as a single corporate entity for the purposes of subject matter jurisdiction. Because “an
LLC is a citizen of every state which its owners/members are citizens,” Johnson v. Columbia
Properties Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006), diversity jurisdiction depends on
the citizenship of all of the members of the LLC and may be destroyed if any owner or member of
Fluent LLC is a citizen of California. At oral argument, counsel for Fluent represented to the
Court that Fluent LLC’s only member is Fluent, Inc. Because Fluent, Inc. is a Delaware
corporation that has its primary place of business in New York, the addition of Fluent LLC as a
defendant does not destroy diversity jurisdiction in this case.
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Plaintiffs, “most of the spams that [they] received advertising Fluent’s website showed purported
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names in the Name From field, e.g., ‘Fargo Rewards,’ ‘Wells-Fargo-Survey,’ ‘US Bank-Visa Card
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Rewards!,’ ‘Amazon Reward Zone,’ and ‘Scott Peru.’” Id. ¶ 41. The sample email reproduced in
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the same paragraph carries the header: “ALERT: (1) AMAZON© Surprise for Kristy”; the line
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below states: “Save by Day ” and below that there is a line with the
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following: “To: luv16starrz@yahoo.com.” Id. In the body of the email, a prominent caption
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“SAVE by day” is followed by:
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AMAZON SURPRISE FOR KRISTY
An AMAZON© card has been loaded with a mystery amount for you kristy.
Reveal the balance and receive the card by using the instructions at
attached website.
AMAZON© Surprise
United States District Court
Northern District of California
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Id. Plaintiffs allege that the “From Names” are “false, or at minimum, misleading, as they
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represent that the spams are from Wells Fargo, US Bank, Amazon, or an individual named Scott
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Peru, as opposed to Fluent.” Id. ¶ 42. They further allege that Fluent may not have registered
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these “generic phrases” as fictitious business names and that even if they have, they do not
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identify Fluent. Id. ¶ 43. Plaintiffs allege that Fluent intentionally used these misleading “From
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Names” so that Recipients would not know who the emails were from when viewing them from
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the “inbox view,” forcing recipients to open them in order to determine whether they were from
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their bank or some other entity to which they had consented to receive commercial advertisements.
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Id. ¶ 43–44.
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Plaintiffs also allege that “[m]ost of the spams that [they] received contain email headers
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with falsified and/or misrepresented information.” Id. ¶ 47. Some allegedly carried headers
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advertising Fluent’s “GET ISNTAHARD products,” aimed at erectile dysfunction. Id. ¶ 48.
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Plaintiffs allege that the volume of emails with such headers indicates that Fluent was not aware if
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the recipients had this condition, supporting the inference that Plaintiffs did not consent to receive
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them. Id. Plaintiffs also allege that they received emails from Fluent “with falsified . . . headers
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which claim to contain gift cards from ‘Wells-Fargo[ ]’” and emails that “knowingly use[d]
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inflammatory, false, and misrepresented Subject Lines referencing mortgage refinancing in order
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to have recipients open the emails and sign up for its products and services[.]” Id. ¶¶ 49–50.
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As an example of emails Plaintiffs received with misleading subject lines, Plaintiffs
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reproduce an email with the subject line “Wells Fargo Wants to Give you $1,000!” that purports to
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be from “Scott Peru
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