Stiener et al v. Apple, Inc. et al

Filing 20

ANSWER to Complaint with Jury Demand byApple, Inc.. (Preovolos, Penelope) (Filed on 10/19/2007)

Stiener et al v. Apple, Inc. et al

Doc. 20

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 1 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14

PENELOPE A. PREOVOLOS (CA SBN 87607) ([e-mail]) ANDREW D. MUHLBACH (CA SBN 175694) ([e-mail]) JOHANNA W. ROBERTS (CA SBN 191472) ([e-mail]) MORRISON & FOERSTER LLP 425 Market Street San Francisco, California 94105-2482 Telephone: [phone] Facsimile: 415.268.7522 Attorneys for Defendant APPLE INC. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

ZOLTAN STIENER and YNEZ STIENER, individually and on behalf of all others similarly situated, Plaintiffs, v. APPLE, INC., AT&T MOBILITY, LLC, and DOES 1 THROUGH 50, inclusive, Defendants.

Case No.

C 07-04486-SBA

CLASS ACTION ANSWER TO CLASS ACTION COMPLAINT DEMAND FOR JURY TRIAL The Hon. Saundra B. Armstrong Complaint filed: August 29, 2007

15 16 17 18 19 20 21 22 23 24 25 26 27 28
ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906
Dockets.Justia.com

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 2 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Defendant Apple Inc. ("Apple"), by and through its attorneys, answers Plaintiffs Zoltan and Ynez Stiener's ("plaintiffs") Complaint as follows: INTRODUCTION 1. Responding to paragraph 1 of the Complaint, Apple states that plaintiffs purport to

seek damages, attorneys fees and costs, and equitable relief for themselves and others similarly situated. Apple denies that plaintiffs or members of the purported class have been damaged or are entitled to relief of any kind. Except as expressly stated, Apple denies each and every averment contained in paragraph 1. 2. Responding to paragraph 2 of the Complaint, Apple states that plaintiffs purport to

state a claim under the California Unfair Competition Law, Business and Professions Code §§ 17200, et seq. ("UCL" or "§ 17200"), as well as for Breach of Contract, Breach of the Implied Warranty of Merchantability, and Fraudulent Concealment. Apple denies that plaintiffs or members of the purported class have been damaged in any way. Except as expressly stated, Apple denies each and every averment contained in paragraph 2. PARTIES 3. Responding to paragraph 3 of the Complaint, Apple is without knowledge or

information sufficient to form a belief as to the truth of the averments contained in paragraph 3 and on that basis denies the averments. 4. Responding to paragraph 4 of the Complaint, Apple states that it designs,

manufactures, and markets personal computers, portable digital music players, mobile phones, and related software, services and peripherals. Apple states that it does business in the Northern District of California. Apple further states that it sells its products in California and in the United States. Apple is without knowledge or information sufficient to form a belief as to the truth of the averments regarding AT&T contained in paragraph 4 and on that basis denies the averments. Except as expressly stated, Apple denies each and every averment contained in paragraph 4. 5. Responding to paragraph 5 of the Complaint, Apple states that insofar as plaintiffs'

averments contained in paragraph 5 are not material and state conclusions of law, no response thereto is required.
ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

1

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 3 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

6.

Responding to paragraph 6 of the Complaint, Apple states that insofar as plaintiffs'

averments contained in paragraph 6 are not material and state conclusions of law, no response thereto is required. 7. Responding to paragraph 7 of the Complaint, Apple is without knowledge or

information sufficient to form a belief as to the truth of the averments and on that basis denies the first sentence of paragraph 7 because its use of the unspecified phrase "consumer electronics" renders the allegation ambiguous. Apple is also without knowledge or information sufficient to form a belief as to the truth of the averments regarding AT&T contained in the second sentence of paragraph 7 and on that basis denies the averments. Apple denies the remaining averments of paragraph 7. JURISDICTION AND VENUE 18[sic].Responding to paragraph 18 of the Complaint, insofar as plaintiffs' averments state conclusions of law, no response there to is required. Except as expressly stated, Apple denies each and every averment contained in paragraph 18. 19. Responding to paragraph 19 of the Complaint, insofar as plaintiffs' averments in

paragraph 19 state conclusions of law, no response thereto is required. Apple states that it advertised the iPhone in the Northern District of California. Apple is without knowledge or information sufficient to form a belief as to the truth of the averments regarding plaintiffs or AT&T contained in paragraph 19 and on that basis denies the averments. Except as expressly stated, Apple denies each and every averment contained in paragraph 19. 20. Responding to paragraph 20 of the Complaint, insofar as plaintiffs' averments

state conclusions of law, no response there to is required. Apple is unable to respond to paragraph 20 because its use of the term "the iPhones" is vague and ambiguous. Without clarification, Apple is without knowledge or information sufficient to form a belief as to the truth of the averments in paragraph 20 and on that basis denies the averments. FACTUAL BACKGROUND 21. Responding to paragraph 21 of the Complaint, Apple states that the iPhone is a

multifunction, internet-enabled mobile phone designed and sold by Apple. Apple is unable to 2 ANSWER TO CLASS ACTION COMPLAINT
Case No. C 07-04486-SBA sf-2389906

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 4 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

further respond to paragraph 21 because its use of the term "multimedia" is vague and ambiguous. Without clarification, Apple is without knowledge or information sufficient to form a belief as to the truth of such averments in paragraph 21 and on that basis denies the averments. 22. Responding to paragraph 22 of the Complaint, Apple states that the iPhone first

went on sale on Friday, June 29, 2007, through Apple's retail stores and AT&T's select retail stores. Apple also states that its online store began taking orders for the iPhone on June 29, 2007. Apple further states that, at that time, the iPhone was available in a 4GB model for $499 and an 8GB model for $599. Except as expressly stated, Apple denies each and every averment in paragraph 22. 23. Responding to paragraph 23 of the Complaint, Apple states that 270,000 iPhone

units were sold during Apple's Fiscal Year 2007 Third Quarter and that it reported that information in its Fiscal Year 2007 Third Quarter 10-Q report and Quarterly Results Conference Call. Apple is without knowledge or information sufficient to form a belief as to the truth of the remaining averments contained in paragraph 23 and on that basis denies the averments. 24. Responding to paragraph 24 of the Complaint, Apple states that the iPhone is sold

at AT&T retail stores and that AT&T is the exclusive carrier for iPhone. Apple is unable to further respond to paragraph 24 because its use of the term "mobile phone services" is vague and ambiguous. Without clarification, Apple is without knowledge or information sufficient to form a belief as to the truth of such averments in paragraph 24 and on that basis denies the averments. Except as expressly stated, Apple denies each and every averment in paragraph 24. 25. Responding to paragraph 25 of the Complaint, Apple states that the iPhone

contains a rechargeable lithium-ion battery. Apple is unable to further respond to paragraph 25 because its use of the term "sealed unit" is vague and ambiguous. Without clarification, Apple is without knowledge or information sufficient to form a belief as to the truth of such averments in paragraph 25 and on that basis denies the averments. Except as expressly stated, Apple denies each and every averment in paragraph 25. 26. Responding to paragraph 26 of the Complaint, Apple denies each and every

averment in paragraph 26.
ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

3

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 5 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

27.

Responding to paragraph 27 of the Complaint, Apple states that it offers battery

replacement for out-of-warranty iPhones for $79, plus $6.95 for shipping. Except as expressly stated, Apple denies each and every averment in paragraph 27. 28. Responding to paragraph 28 of the Complaint, Apple states that, for a service fee

of $29, it can provide an "AppleCare Service Phone" for a consumer to use with all of his or her data while the consumer's iPhone is being repaired. Except as expressly stated, Apple denies each and every averment in paragraph 28. 29. Responding to paragraph 29 of the Complaint, Apple is without knowledge or

information sufficient to form a belief as to the truth of the averments regarding plaintiffs' purchases contained in paragraph 29 and on that basis denies the averments. Apple states that all iPhone service plans are based on a two-year service agreement with AT&T. Except as expressly stated, Apple denies each and every averment in paragraph 29. 30. Responding to paragraph 30 of the Complaint, Apple denies each and every

averment in paragraph 30. 31. Responding to paragraph 31 of the Complaint, Apple denies each and every

averment in paragraph 31. CLASS ACTION ALLEGATIONS 32. Responding to paragraph 32 of the Complaint, Apple states that plaintiffs purport

to bring a class action against Apple. Apple denies that class treatment is appropriate and denies that plaintiffs or members of the purported class have been damaged or are entitled to relief of any kind. Except as expressly stated, Apple denies each and every averment contained in paragraph 32. 33. Responding to paragraph 33 of the Complaint, insofar as plaintiffs' averments in

paragraph 33 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 33. 34. Responding to paragraph 34 of the Complaint, insofar as plaintiffs' averments in

paragraph 34 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 34. 4 ANSWER TO CLASS ACTION COMPLAINT
Case No. C 07-04486-SBA sf-2389906

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 6 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

35.

Responding to paragraph 35 of the Complaint, Apple states that plaintiffs'

allegations are conclusions of law and no response is required thereto. 36. Responding to paragraph 36 of the Complaint, Apple states that plaintiffs'

allegations are conclusions of law and no response is required thereto. 37. Responding to paragraph 37 of the Complaint, Apple states that plaintiffs'

allegations are conclusions of law and no response is required thereto. 38. Responding to paragraph 38 of the Complaint, insofar as plaintiffs' averments in

paragraph 38 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 38. 39. Responding to paragraph 39 of the Complaint, insofar as plaintiffs' averments in

paragraph 39 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 39 and each and every averment contained in all subparagraphs of paragraph 39. 40. Responding to paragraph 40 of the Complaint, insofar as plaintiffs' averments in

paragraph 40 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 40. 41. Responding to paragraph 41 of the Complaint, insofar as plaintiffs' averments in

paragraph 41 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 41. 42. Responding to paragraph 42 of the Complaint, insofar as plaintiffs' averments in

paragraph 42 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 42. 43. Responding to paragraph 43 of the Complaint, insofar as plaintiffs' averments in

paragraph 43 state conclusions of law, no response thereto is required. To the extent an answer is required, Apple denies each and every averment contained in paragraph 43. 44. Responding to paragraph 44 of the Complaint, insofar as plaintiffs' averments in

paragraph 44 state conclusions of law, no response thereto is required. Apple states that, if a class were certified, which Apple contends would be inappropriate, it would be possible to notify 5 ANSWER TO CLASS ACTION COMPLAINT
Case No. C 07-04486-SBA sf-2389906

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 7 of 11

1 2 3 4 5 6

putative class members through publication or mailings to known addresses. Apple makes no concessions with respect to the appropriate form of notice. Apple denies that class treatment is appropriate. Except as expressly stated, Apple denies each and every averment contained in paragraph 44. FIRST COUNT (Breach of Contract) 45. Responding to paragraph 45 of the Complaint, Apple realleges and reincorporates

7 by reference each and every preceding paragraph of this Answer as if fully set forth herein. 8 46. 9 paragraph 46 state conclusions of law, no response thereto is required. To the extent an answer is 10 required, Apple denies each and every averment contained in paragraph 46. 11 47. 12 averment contained in paragraph 47. 13 48. 14 averment contained in paragraph 48 and further denies that plaintiffs or members of the purported 15 class have been damaged or are entitled to relief of any kind. 16 17 18 19 20 21 22 23 24 25 26 27 28
ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

Responding to paragraph 46 of the Complaint, insofar as plaintiffs' averments in

Responding to paragraph 47 of the Complaint, Apple denies each and every

Responding to paragraph 48 of the Complaint, Apple denies each and every

SECOND COUNT (Violation of Implied Warranty of Merchantability) 49. Responding to paragraph 49 of the Complaint, Apple realleges and reincorporates

by reference each and every preceding paragraph of this Answer as if fully set forth herein. 50. Responding to paragraph 50 of the Complaint, Apple states that plaintiffs'

allegations are conclusions of law and no response is required thereto. 51. Responding to paragraph 51 of the Complaint, Apple denies each and every

averment contained in paragraph 51. 52. Responding to paragraph 52 of the Complaint, Apple denies each and every

averment contained in paragraph 52 and further denies that plaintiffs or members of the purported class have been damaged or are entitled to relief of any kind.

6

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 8 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 60. 58. 53.

THIRD COUNT (Fraudulent Concealment) Responding to paragraph 53 of the Complaint, Apple realleges and reincorporates

by reference each and every preceding paragraph of this Answer as if fully set forth herein. 54. Responding to paragraph 54 of the Complaint, Apple denies each and every

averment contained in paragraph 54. 55. Responding to paragraph 55 of the Complaint, Apple denies each and every

averment contained in paragraph 55. 56. Responding to paragraph 56 of the Complaint, Apple denied each and every

averment contained in paragraph 56. 57. Responding to paragraph 57 of the Complaint, Apple denies each and every

averment contained in paragraph 57 and further denies that plaintiffs or members of the purported class have been damaged or are entitled to relief of any kind. FOURTH COUNT (Cal. Business and Professions Code § 17200 et seq.) Responding to paragraph 58 of the Complaint, Apple realleges and reincorporates

by reference each and every preceding paragraph of this Answer as if fully set forth herein. 59. Responding to paragraph 59 of the Complaint, Apple denies each and every

averment contained in paragraph 59. FIFTH COUNT (Accounting) Responding to paragraph 60 of the Complaint, Apple realleges and reincorporates

by reference each and every preceding paragraph of this Answer as if fully set forth herein. 61. Responding to paragraph 61 of the Complaint, Apple denies each and every

averment contained in paragraph 61. 62. Responding to paragraph 62 of the Complaint, Apple denies each and every

averment contained in paragraph 62.

ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

7

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 9 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4. 3. 2. 1.

PRAYER FOR RELIEF Apple denies that plaintiffs or any member of the purported class suffered injury or damage, and further denies that plaintiffs or any member of the purported class is entitled to relief of any kind. AFFIRMATIVE DEFENSES As to affirmative defenses to the Complaint, Apple does not, by stating the matters set forth in these defenses, allege or admit that it has the burden of proof and/or persuasion with respect to any of these matters, and does not assume the burden of proof or persuasion as to any matters as to which plaintiffs have the burden of proof or persuasion. FIRST AFFIRMATIVE DEFENSE (Failure to State a Claim -- All Causes of Action) The Complaint, and each and every cause of action therein, fails to state facts

sufficient to constitute a cause, or causes, of action against Apple. SECOND AFFIRMATIVE DEFENSE (Failure to Notify of Breach of Warranty) As to those causes of action based upon a breach of warranty, plaintiffs failed to

notify Apple of any breach of warranty within a reasonable time after plaintiffs knew or should have known of any purported breach. THIRD AFFIRMATIVE DEFENSE (Waiver) The Complaint, and each of its purported causes of action, is barred, in whole or in

part, by the doctrine of waiver. FOURTH AFFIRMATIVE DEFENSE (Estoppel) The Complaint, and each of its purported causes of action, is barred, in whole or in

part, by the equitable doctrine of estoppel.

ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

8

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 10 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7. 6. 5.

FIFTH AFFIRMATIVE DEFENSE (Equitable Relief -- Remedies) Plaintiffs and the purported class are barred from asserting the claims for equitable

relief alleged in the Complaint because they have adequate remedies at law and/or the equitable relief is neither necessary nor proper under applicable law. SIXTH AFFIRMATIVE DEFENSE (Failure to Mitigate) Plaintiffs and the purported class have failed to mitigate their damages, if any. SEVENTH AFFIRMATIVE DEFENSE (Lack of Article III Standing) Apple alleges on information and belief that plaintiffs and the members of the

purported class lack standing under Article III of the Constitution of the United States. Apple reserves the right to assert other defenses as discovery progresses. PRAYER WHEREFORE, Apple prays for judgment as follows: 1. That plaintiffs and the purported class take nothing by way of the Complaint; 2. That the Complaint be dismissed with prejudice and judgment be entered in favor of Apple; 3. That Apple be awarded its costs of suit; and 4. For such other and further relief as the Court deems just and proper.

ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

9

Case 4:07-cv-04486-SBA

Document 20

Filed 10/19/2007

Page 11 of 11

1 DEMAND FOR JURY TRIAL 2 3 4 Dated: October 19, 2007 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
ANSWER TO CLASS ACTION COMPLAINT Case No. C 07-04486-SBA sf-2389906

Apple hereby demands a trial by jury on all issues upon which trial by jury may be had.

PENELOPE A. PREOVOLOS ANDREW D. MUHLBACH JOHANNA W. ROBERTS MORRISON & FOERSTER LLP

By: /s/ Penelope A. Preovolos Penelope A. Preovolos Attorneys for Defendant APPLE INC.

10