McKinney v. Google, Inc. et al

Filing 94

REPLY (re 83 MOTION to Dismiss SECOND AMENDED COMPLAINT ) Defendants Google Inc. and HTC Corporation's Reply Brief in Support of Motion to Dismiss Second Amended Complaint filed byGoogle, Inc., HTC Corp.. (Larrabee, Matthew) (Filed on 4/18/2011)

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MATTHEW L. LARRABEE (No. 97147)
[e-mail]
DECHERT LLP
One Maritime Plaza, Suite 2300
San Francisco, California 94111-3513
Telephone: [phone]
Facsimile: 415.262.4555
STEVEN B. WEISBURD (No. 171490)
[e-mail]
DECHERT LLP
300 West 6th Street
Suite 2010
Austin, TX 78701
Telephone: [phone]
Facsimile: 512.394.3001

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Attorneys for Defendant
GOOGLE INC.

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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MARY McKINNEY, et al.,

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Plaintiff,

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v.

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GOOGLE INC., a Delaware corporation,
HTC CORP., a Taiwanese corporation, and
T-MOBILE USA, INC., a Delaware
corporation,

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Defendants.

Case No. 5:10-CV-01177-JW
Case No. 5:10-CV-03897-JW
DEFENDANTS GOOGLE INC. AND HTC
CORPORATION’S REPLY BRIEF IN
SUPPORT OF MOTION TO DISMISS
SECOND AMENDED COMPLAINT
Date:
Time:
Dept.
Judge:

April 25, 2011
9:00 a.m.
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Hon. James Ware

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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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TABLE OF CONTENTS

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Page

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I.

INTRODUCTION .............................................................................................................. 1

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II.

ARGUMENT ...................................................................................................................... 1

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A.

Plaintiff’s Misrepresentation Claims Should Be Dismissed Under Rule
9(b). ......................................................................................................................... 1

B.

Plaintiff’s Breach Of Warranty Claims Should Be Dismissed. .............................. 4

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1.

Plaintiff’s “Express Warranty” Claim Fails................................................ 4

2.

Plaintiff’s “Implied Warranty Of Merchantability” Claim Fails. ............... 6

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a.

The SAC Admits The Nexus One Is A Device That
Provides Voice And Data Service On Both 2G and 3G
Networks. ........................................................................................ 7

b.

Google’s Legally Enforceable Disclaimer Of Any Implied
Warranties Extinguishes Any Claim............................................... 8

c.

Plaintiff Lacks Privity With HTC. .................................................. 8

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3.

Plaintiff’s Arguments Based On The Song-Beverly Act Do Not
And Cannot Save Her Warranty Claims From Dismissal........................... 8

4.

Plaintiff’s State-Law Warranty Claims Are Also Preempted. .................... 9

5.

Plaintiff’s Federal Warranty Claim Under The Magnuson-Moss
Warranty Act Fails Along With Her Deficient State-Law Claims. .......... 10

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C.

Plaintiff’s Negligence Claim Should Be Dismissed As Barred By The
Economic Loss Rule. ............................................................................................ 10

D.

Plaintiff’s Unjust Enrichment And Declaratory Relief Claims Should Be
Dismissed. ............................................................................................................. 12

E.

All Of Plaintiff’s Claims Should Be Dismissed As Preempted By The
FCA. ...................................................................................................................... 13

F.

Plaintiff’s Customer Service Allegations Cannot Support Any Viable
Claim. .................................................................................................................... 14

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III.

CONCLUSION ................................................................................................................. 15

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TABLE OF AUTHORITIES

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Page

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CASES

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Ashcroft v. Iqbal,
129 S. Ct. 1937 (2009) ............................................................................................................ 10

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Baltazar v. Apple, Inc.,
2011 U.S. Dist. LEXIS 13187 (N.D. Cal. Feb. 10, 2011)................................................. 3, 5, 6
Bastien v. AT&T Wireless Servs., Inc.,
205 F.3d 983 (7th Cir. 2000)............................................................................................. 13, 14
Bell Atl. Corp. v. Twombly,
550 U.S. 544 (2007) .......................................................................................................... 10, 11
Birdsong v. Apple, Inc.,
590 F.3d 955 (9th Cir. 2009)..................................................................................................... 8
Daugherty v. American Honda Motor Co.,
144 Cal. App. 4th 824 (2006) ................................................................................................... 3
E. River S.S. Corp. v. Transamerica Delaval Inc.,
476 U.S. 858 (1986) ................................................................................................................ 11
Gonzalez v. Drew Indus. Inc.,
2007 U.S. Dist. LEXIS 35952 (C.D. Cal. May 10, 2007) ........................................................ 5
In re Apple iPhone 3G Prods. Liab. Litig.,
No. 09-2045, slip op. (N.D. Cal. April 2, 2010) ..................................................................... 14
In re NVIDIA GPU Litig.,
2009 U.S. Dist. LEXIS 108500 (N.D. Cal. Nov. 19, 2009)................................................ 8, 12
Jimenez v. Superior Ct.,
29 Cal. 4th 473 (2002) ...................................................................................................... 10, 12
Kearns v. Ford Motor Co.,
567 F.3d 1120 (9th Cir. 2009)............................................................................................... 2, 3
Maneely v. General Motors Corp.,
108 F.3d 1176 (9th Cir. 1997)................................................................................................... 4

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Mangindin v. Wash. Mut. Bank,
637 F. Supp. 2d 700 (N.D. Cal. 2009) ...................................................................................... 2
Marolda v. Symantec Corp.,
672 F. Supp. 2d 992 (N.D. Cal. 2009) ...................................................................................... 3
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McKinniss v. Sunny Delight Beverages Co.,
2007 U.S. Dist. LEXIS 96108................................................................................................... 4
Moss v. U.S. Secret Serv.,
572 F.3d 962 (9th Cir. 2009)................................................................................................... 10
Paracor Fin., Inc. v. GE Capital Corp.,
96 F.3d 1151 (9th Cir. 1996)................................................................................................... 12
Roberts v. USSC Payroll Corp.,
635 F. Supp. 2d 948 (N.D. Iowa 2009)................................................................................... 15
Robinson Helicopter Co. v. Dana Corp.,
34 Cal. 4th 979 (2004) ............................................................................................................ 10
Sanders v. Apple, Inc.,
672 F. Supp. 2d 978 (N.D. Cal. 2009) ...................................................................................... 4
Shroyer v. New Cingular Wireless Servs., Inc.,
622 F.3d 1035 (9th Cir. 2010)........................................................................................... 13, 14

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Tietsworth v. Sears, Roebuck & Co.,
2009 U.S. Dist. LEXIS 98532 (N.D. Cal. Oct. 13, 2009)......................................................... 9
Vess v. Ciba-Geigy Corp.,
317 F.3d 1097 (9th Cir. 2003)............................................................................................... 2, 3
Williams v. Beechnut Nutrition Corp.,
185 Cal. App. 3d 135 (1986)..................................................................................................... 5

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STATUTES

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47 U.S.C. § 332(c)(3).............................................................................................................. 13, 14

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California Civil Code § 1770 .......................................................................................................... 4

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California Commercial Code § 2316(2).......................................................................................... 8

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California Commercial Code § 2607 .............................................................................................. 4

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OTHER AUTHORITIES

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Fed. R. Civ. Proc. Rule 8(a) ............................................................................................................ 1

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Fed. R. Civ. Proc. Rule 9(b).............................................................................................. 1, 2, 3, 14

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Fed. R. Civ. Proc. Rule 12(b)(6) ..................................................................................................... 1

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ATTORNEYS AT LAW
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I.

INTRODUCTION
In multiple respects, the opposition (“Opp.”) filed by plaintiff Mary McKinney

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(“Plaintiff”) serves only to confirm that the Rule 12(b)(6) motion to dismiss the Second Amended

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Complaint (“SAC”) filed by defendants Google Inc. (“Google”) and HTC Corporation (“HTC”)

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should be granted. Indeed, Plaintiff offers no response to many of Google and HTC’s

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independently dispositive arguments in their motion’s opening brief (“Motion”), and the few

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arguments that she does offer are insufficient and, in fact, demonstrably incorrect. Because

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Plaintiff has now had three opportunities to state a claim, and offers no indication how she would

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(or could) do so if again given leave to amend, the SAC should be dismissed with prejudice.

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II.

ARGUMENT

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A.

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Plaintiff’s claims based on alleged misrepresentations that the Nexus One would maintain

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“consistent” connectivity to T-Mobile’s 3G network must be dismissed for failure to satisfy Rule

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9(b)’s particularity requirements. During oral argument on Google and HTC’s motion to dismiss

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the First Amended Complaint, Plaintiff’s counsel stated – to secure leave to amend – that the

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SAC would “‘meet the challenge that is being offered, namely, to allege a misrepresentation

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based on a representation that [the Nexus One] will consistently function at 3G all of the time.’”

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Opp. at 11 (quoting Nov. 1, 2010 Hg. Tr., at 24:15-25:4). Plaintiff does not deny that, contrary to

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counsel’s statement, the SAC does not plead any representation by Google or HTC that even

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mentions 3G connectivity, let alone promises the Nexus One will maintain “consistent” 3G

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connectivity. Instead, Plaintiff’s Opposition offers only a series of confused arguments, which do

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nothing to excuse her failure to identify any actionable misrepresentation by Google or HTC.

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First, Plaintiff wrongly asserts that her UCL, FAL and CLRA claims are governed by

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Rule 8(a)’s notice pleading rule, and not Rule 9(b). See Opp. at 7-9.1 The Ninth Circuit has

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consistently and repeatedly held that Rule 9(b) applies to state law claims based on fraudulent

Plaintiff’s Misrepresentation Claims Should Be Dismissed Under Rule 9(b).

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Plaintiff does not seriously dispute that Rule 9(b) applies to her common law fraud, negligent
misrepresentation, and unjust enrichment claims; Plaintiff actually tries to argue only that her
“UCL, FAL, and CLRA Claims” are not governed by Rule 9(b). See id. at 7-8.
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misrepresentations, including claims under California’s consumer protection statutes. Kearns v.

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Ford Motor Co., 567 F.3d 1120, 1125-27 (9th Cir. 2009) (UCL and CLRA claims); Vess v. Ciba-

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Geigy Corp., 317 F.3d 1097, 1103-06 (9th Cir. 2003) (UCL, FAL and CLRA claims); Motion at

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10. The Ninth Circuit in Kearns explicitly held that, where the plaintiff asserts California

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statutory consumer fraud claims premised on defendant’s alleged “misrepresentations” and

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related “nondisclosure[s]” about its product, both the misrepresentation and non-disclosure

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allegations must be pled with particularity or the claims are subject to dismissal under Rule 9(b).

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567 F.3d at 1125-27. Any misrepresentation-based allegations not pled with Rule 9(b)

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particularity “should be ‘disregarded,’ or ‘stripped’ from the claim for failure to satisfy Rule

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9(b).” Kearns, 567 F.3d at 1124 (quoting Vess, 317 F.3d at 1105).2 Here, Plaintiff’s UCL, FAL,

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and CLRA claims are based on alleged misrepresentations by Google and HTC that Nexus One

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would maintain “consistent” 3G connectivity and thus must be pled with Rule 9(b) particularity.

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Second, Plaintiff’s contention that her SAC’s conclusory allegations “satisf[y] Rule 9(b)”

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(Opp. at 7, 9-10) is manifestly without merit. As this Court has held, Rule 9(b) requires Plaintiff

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to identify and plead the “specific content” of any “false representations” supposedly made by

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Google and HTC. Mangindin v. Wash. Mut. Bank, 637 F. Supp. 2d 700, 706-07 (N.D. Cal. 2009)

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(Ware, J.). Here, however, Plaintiff does not allege with particularity any representation by

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Google or HTC that the Nexus One would maintain “consistent” 3G connectivity – the

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“misrepresentation” on which Plaintiff’s claims are based. See Motion at 1, 10; see also Opp. at 1

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(“consistent 3G access”). In fact, Plaintiff does not allege any representation by either defendant

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that even mentions 3G in connection with the Nexus One. Although she alleges that the

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“appellation” 3G is “commonly understood to provide superior data transfer rates over older cell

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technology,” Opp. at 2, Plaintiff overlooks the fact that there is no such “appellation” for the

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Nexus One (unlike, for instance, the “iPhone 3G”). Ultimately, it is dispositive that the SAC does

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The few authorities Plaintiff cites suggest merely that some essential elements of a common law
fraud claim – such as “intent” – need not be pled with Rule 9(b) particularity or at all under the
UCL. See Opp. at 10-12. But that in no way excuses Plaintiff’s failure to identify and plead with
particularity some actionable misrepresentation by Google and HTC falsely promising that the
Nexus One would maintain “consistent 3G connectivity” – as required by Rule 9(b) under Vess,
Kearns, and the other authorities cited by Google and HTC.
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not identify a single representation by HTC about the Nexus One, and that the only representation

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by Google alleged with particularity is this entirely non-actionable statement from Google’s

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website: “‘Experience Nexus One, the new Android phone from Google.’” Motion at 10 (quoting

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SAC, ¶ 35).3

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Finally, Plaintiff is wrong to suggest that her conclusory allegations might be deemed

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sufficient because she has alternatively cast them as claims of “omission” or “concealment.” See

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Opp. at 8-9. Under settled law, Rule 9(b) applies to claims of nondisclosure and omission, as

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varieties of misrepresentations. Kearns, 567 F.3d at 1126; Marolda v. Symantec Corp., 672 F.

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Supp. 2d 992, 1001-02 (N.D. Cal. 2009); Motion at 12-13 & n.8 (citing cases). Moreover, as this

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Court recognized in Long v. Hewlett-Packard Co., “‘to be actionable [an] omission must be

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contrary to a representation actually made by the defendant.’” 2007 U.S. Dist. LEXIS 79262, at

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*24 (N.D. Cal. July 27, 2007) (quoting Daugherty v. American Honda Motor Co., 144 Cal. App.

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4th 824, 835 (2006)); accord Baltazar v. Apple, Inc., 2011 U.S. Dist. LEXIS 13187, at *11 (N.D.

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Cal. Feb. 10, 2011) (dismissing omission-based claim under Daugherty where “Plaintiffs do not

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identify any affirmative representation concerning the subject of any alleged omissions”). Hence,

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Plaintiff’s failure to plead any Google or HTC representation that even mentions the consistency

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of the Nexus One’s “3G” connectivity dooms her omission allegations. See Motion at 12-13.4

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In sum, despite the Court’s leave to amend, Plaintiff has still failed to plead her allegations

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of misrepresentation and related omission with the particularity demanded by Rule 9(b). The

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SAC’s conclusory allegations must be “disregarded” and “stripped” from the SAC under settled

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Ninth Circuit law, Kearns, 567 F.3d at 1124; Vess, 317 F.3d at 1105, and Plaintiff’s

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Plaintiff also simply ignores that she has no basis in fact or law to try to hold Google and HTC
accountable for any alleged statement supposedly “made to her by a ‘T-Mobile sales
representative’” that the Nexus One is essential for websurfing, email, and has “3G speed” –
which, in any event, is not even alleged to have “promise[d] that the Nexus One will maintain
‘consistent’ 3G connectivity on T-Mobile’s 3G wireless network, much less other 3G wireless
networks.” Motion at 12-13 (emphasis in original; quoting SAC, ¶ 39). Perhaps Plaintiff can
raise this in her arbitration against non-defendant T-Mobile, but it cannot support claims here
against Google and HTC for statements they never made. See also Motion at 12 n.7.
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As Plaintiff does not dispute, the SAC also fails to identify and plead with Rule 9(b)
particularity any representation by Google or HTC that they would provide some type of
customer service that they allegedly failed to provide. See Motion at 12- 13, 23. So Plaintiff’s
“customer service” misrepresentation allegations fail for the same reasons.
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misrepresentation-based claims in the SAC – First, Second, Third, Seventh, Eighth, and Ninth

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Causes of Action – necessarily fail as a matter of law.

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B.

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As a procedural matter, Plaintiff’s warranty claims fail for lack of “pre-suit notice.”

Plaintiff’s Breach Of Warranty Claims Should Be Dismissed.

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Motion at 15. Unable to deny that the SAC fails to allege that she gave pre-suit notice on her

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warranty claims (which she did not), Plaintiff asserts that her “CLRA notice” under California

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Civil Code section 1770 should suffice even though she cites no authority that CLRA notice can

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substitute for her separate and independent legal obligation to give pre-suit warranty notice under

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California Commercial Code section 2607. Opp. at 12-13. More fundamentally, Plaintiff’s

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warranty claims fail for multiple substantive reasons as well, as explained below.
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Plaintiff’s “Express Warranty” Claim Fails.

As Google and HTC argued, Plaintiff’s express warranty claim fails because the SAC

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does not allege any statement by Google or HTC that could constitute an express warranty that

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the Nexus One would maintain “consistent” 3G connectivity, nor does it allege Plaintiff’s

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reasonable reliance on any such supposed express warranty. See Motion at 15-18. Plaintiff’s

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Opposition does not and cannot respond to these dispositive legal arguments.

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First, Plaintiff’s claim fails because the SAC does not plead that Google and HTC actually

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made the express warranty on which this claim depends, i.e., the explicit promise that the Nexus

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One was “guaranteed to provide ‘consistent’ 3G connectivity.” Motion at 16 (quoting SAC, ¶¶

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100-04). To adequately plead “the exact terms of the warranty,” Sanders v. Apple, Inc., 672 F.

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Supp. 2d 978, 987 (N.D. Cal. 2009), Plaintiff had to allege facts sufficient to show that Google

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and HTC actually made some “explicit guarantees” and “specific and unequivocal written

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statement[s]” about the consistency of the Nexus One’s connectivity to T-Mobile’s 3G network

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that could qualify as the sort of “affirmation[ ] of fact or promise[ ] ” required to constitute an

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actionable “express warranty.” Maneely v. General Motors Corp., 108 F.3d 1176, 1181 (9th Cir.

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1997); accord McKinniss v. Sunny Delight Beverages Co., 2007 U.S. Dist. LEXIS 96108, at

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**16-17 (C.D. Cal. Sept. 4, 2007). The SAC does not satisfy this most fundamental requirement

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because it does not – and cannot – identify any instance in which Google or HTC actually made
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
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statements promising that the Nexus One would maintain “consistent” 3G connectivity. See also

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pp. 1-4, supra.

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Plaintiff’s Opposition offers a string-cite of mostly non-California cases, which ultimately

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just confirm that no claim will lie unless the defendant made some affirmation of fact and

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promise sufficient to qualify as an actionable express warranty. See Opp. at 14. The two

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California cases Plaintiff cites are inapposite, and underscore why Plaintiff’s express warranty

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claim fails. In Gonzalez v. Drew Indus. Inc., 2007 U.S. Dist. LEXIS 35952 (C.D. Cal. May 10,

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2007), the express warranty claim survived a dismissal motion where (unlike here) the plaintiff

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alleged that the defendants had affixed “stickers” to the plastic bathtubs at issue that explicitly but

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falsely promised that its bathtubs were tested and conformed with federal flammability standards,

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and (also unlike here) the defendant did not even dispute the existence of the express warranty at

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issue. Id. at **2-4, 34-35. Also unlike this case is Williams v. Beechnut Nutrition Corp., 185 Cal.

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App. 3d 135 (1986) – cited by Plaintiff – which involved “a glass juice bottle intended for use by

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infants” and “shaped like a ‘baby bottle,’” which shattered and injured the plaintiff’s infant during

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use. 185 Cal. App. 3d at 138. Given these extraordinary facts, the court of appeal had no

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problem concluding that the manufacturer expressly warranted that its product was reasonably

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safe for use by infants (when in fact it was not), especially where plaintiffs alleged that the

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defendant “‘expressly warranted’” that the glass baby bottle was “‘safe for its intended use.’” Id.

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at 142. Here, however, there is no basis for Plaintiff’s assertion that Google and HTC expressly

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warranted, and therefore guaranteed, “consistent” 3G connectivity for the Nexus One – a device

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Plaintiff admits was designed to operate on both 2G and 3G networks so that voice and data

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services could still be used when 3G connectivity is unavailable. See SAC, ¶¶ 41, 52-53, 64.

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Accordingly, this case is far more like Baltazar v. Apple, Inc., 2011 U.S. Dist. LEXIS 13187

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(N.D. Cal. Feb. 10, 2011), where Judge Fogel recently dismissed the plaintiff’s express warranty

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claim based on Apple’s supposed promise that its iPad would “function outdoors as an e-reader

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and mobile internet device” as allegedly “represented by Apple.” Id. at *2. As in Baltazar,

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Plaintiff has failed to recite “the exact terms” of the supposed express warranty by specifying the

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“content” of the actual representation made that supposedly forms the basis for Plaintiff’s express
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
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warranty claim. Id. at **6-7.

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Second, Plaintiff’s express warranty claim also must be dismissed because, as her

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Opposition confirms, she cannot establish “reasonable reliance” on any express warranty actually

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made by Google or HTC. Motion at 17-18 (citing cases); see also Baltazar, 2011 U.S. Dist.

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LEXIS 13187, at *6 (dismissing express warranty claim where plaintiffs failed to allege their own

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“reasonable reliance on the particular commercial or advertisement” whereby the defendant

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supposedly made an actionable express warranty). Here, any subjective “‘expectation’” that

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Plaintiff might have had about whether the Nexus One would maintain “consistent” 3G

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connectivity cannot be based on anything Google and HTC actually stated and thus expressly

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warranted. See Motion at 17 (quoting SAC, ¶ 104). Indeed, Plaintiff neither alleges nor argues in

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her Opposition that she relied on any actual statement made by either Google or HTC promising

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and therefore expressly warranting that the Nexus One would maintain “consistent” 3G

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connectivity.5 This too is dispositive. Finally, Plaintiff ignores Google and HTC’s additional

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argument that the terms and disclaimers in their contracts contradict Plaintiff’s allegations and

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refute the reasonableness of any claimed reliance on promises Google and HTC never made. Id.

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at 16-17.

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2.

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Plaintiff’s “Implied Warranty Of Merchantability” Claim Fails.

As Google and HTC argued, Plaintiff’s implied warranty claim fails because (1) the SAC

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fails to allege facts showing that the Nexus One is not merchantable under the governing

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California authorities; (2) Google’s disclaimer of implied warranties further undermines the

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claim; and (3) Plaintiff lacks privity with HTC. See Motion at 17-21. The Opposition does not

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sufficiently respond to these independently dispositive arguments.

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Plaintiff’s Opposition says that she relied “in part” on the “concept” that she was buying a
device that would maintain “consistent 3G connectivity,” Opp. at 16, given the “impression” she
says she had. Id. at 1, 9. But despite her conclusory argument that Google and HTC “touted” the
Nexus One’s “3G characteristics” in product advertising, id. at 16, Plaintiff does not identify and
allege facts showing that Google and HTC actually stated that the Nexus One would provide
“consistent” 3G connectivity, or that she relied on any such non-existent promise. As a matter of
law, there is no such thing as an implied “express warranty.”
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a.

The SAC Admits The Nexus One Is A Device That Provides
Voice And Data Service On Both 2G and 3G Networks.

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As a threshold matter, Plaintiff has no response to Google and HTC’s argument and cited

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authorities demonstrating why, as a matter of law, the Nexus One is merchantable as a

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smartphone that provides voice and data service on both 2G and 3G networks so that these

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services can still be used when 3G connectivity is unavailable. See Motion at 18-20. Plaintiff

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admits in the SAC that the Nexus One was designed to – and does – function as a smartphone

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that provides voice and data service on a 2G network when a 3G network is unavailable. See

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Motion at 19 (citing SAC, ¶¶ 52, 53). For this reason, notwithstanding Plaintiff’s subjective view

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that the Nexus One should provide these services “more consistently” on a 3G network, her

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implied warranty claim necessarily fails as a matter of law – just as courts have repeatedly held in

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rejecting comparable claims premised on alleged performance problems with products that, like

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the Nexus One, were operational as to the basic level of functionality protected by the implied

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warranty of merchantability doctrine. Id. at 19 (discussing cases).6
This is the second time that Plaintiff has failed to respond to Google and HTC’s argument

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and authorities on this most basic deficiency in her implied warranty of merchantability claim.

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Plaintiff’s continued silence confirms there is no response that can save her claims. Moreover,

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Plaintiff’s new allegations in the SAC regarding her purported experiences with two Nexus One
devices she owned before her current Nexus One device are a red herring and only confirm that
Google and HTC comply with applicable warranties. As her counsel told this Court, the claim
Plaintiff wishes to pursue is “not” that “the [Nexus One] won’t operate at all” but rather “that [the
Nexus One] vacillates between 2G and 3G” and therefore fails to provide “consistent” 3G
connectivity. Id. n.13 (quoting Nov. 1, 2010 Hg. Tr. at 22:13-24:5). Thus, allegations regarding
Plaintiff’s “first Google phone,” which she contends “never had 3G service,” are irrelevant.
Moreover, Plaintiff admits that her second Nexus One device and the Nexus One device she is
currently using provide voice and data service, just not as “consistently” as she apparently would
like. See Motion at 2, 5, 19-20; Opp. at 17. Finally, Plaintiff complains that when replacing her
first two devices Defendants “passed off” used devices “as equivalent to” a new device. This is
an unfair and inaccurate characterization of Defendants’ efforts to address issues Plaintiff claims
she had with her first two devices. HTC’s Limited Warranty expressly states that defective
devices will be repaired or replaced and such repair or replacement “may involve the use of
functionally equivalent reconditioned units.” See Exhibit 2 to Defendants’ RFJN. Plaintiff
expressly acknowledged HTC’s Limited Warranty in accepting Google’s Terms of Sale, and
received a copy of the Limited Warranty in Nexus One packaging. Far from supporting
Plaintiff’s breach of warranty claims, these allegations show that Defendants have fully complied
with any warranty obligations.
7
DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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Plaintiff has not only conceded by her silence that this claim must be dismissed, but also

2

“waived” any contrary arguments. City of Arcadia v. EPA, 265 F. Supp. 2d 1142, 1154 n.16

3

(N.D. Cal. 2003).

4

b.

5
6

Google’s Legally Enforceable Disclaimer Of Any Implied
Warranties Extinguishes Any Claim.

While the SAC’s implied warranty claim must be dismissed for the foregoing reason,

7

Plaintiff offers no meaningful response to Google’s argument based on the legally enforceable

8

and explicit disclaimer of any “IMPLIED WARRANTIES OF MERCHANTABILITY” set forth

9

in the Google Terms of Sale,7 which satisfies the requirements of California Commercial Code

10

section 2316(2). See Motion, Exh. 1, at p. 4; RFJN, Exh. 1, at p. 4. This disclaimer bars any

11

implied warranty claim under California common law and the California Commercial Code.

12

c.

Plaintiff Lacks Privity With HTC.

13

Plaintiff does not dispute that she lacks privity with HTC, or that privity is required to

14

state a claim for breach of implied warranty under California common law. See In re NVIDIA

15

GPU Litig., 2009 U.S. Dist. LEXIS 108500, at *21 (N.D. Cal. Nov. 19, 2009).

16

3.

17

Plaintiff’s Arguments Based On The Song-Beverly Act Do Not And
Cannot Save Her Warranty Claims From Dismissal.

Unable to respond to Google and HTC’s dispositive arguments requiring dismissal of her
18
express and implied warranty claims under California common law, Plaintiff attempts to save
19
these claims by asserting that they are “properly pleaded” under the “Song-Beverly Act.” Opp. at
20
15-16. Plaintiff has it backwards. To state any claim under the Song-Beverly Act, Plaintiff must
21
first “plead successfully a breach of state warranty law.” Birdsong v. Apple, Inc., 590 F.3d 955,
22
958 n.2 (9th Cir. 2009). Here, the same fundamental defects requiring dismissal of Plaintiff’s
23
common law warranty claims also require dismissal of any Song-Beverly Act claim. Id.
24
Moreover, Plaintiff offers no response to Google and HTC’s argument and cited authority
25
that the Song-Beverly Act does not apply to product purchases over the Internet made by out-of26
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In an effort to evade this result, Plaintiff in her RFJN opposition relies on meritless assertions
and arguments, which Google rebuts it its RFJN reply.
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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state residents. See Motion at 13 n.9. Indeed, Annunziato v. eMachines, Inc. confirms that non-

2

California residents – like Plaintiff, a Pennsylvania resident, see SAC, ¶ 2 – who “purchased the

3

product over the internet” cannot pursue Song-Beverly Act claims. 402 F. Supp. 2d 1133, 1142

4

(C.D. Cal. 2005). As to her lack privity with HTC, Plaintiff does not dispute that privity is

5

required for breach of implied warranty claim under the Commercial Code, and ignores authority

6

holding that privity is also required under the Song-Beverly Act. Tietsworth v. Sears, Roebuck &

7

Co., 2009 U.S. Dist. LEXIS 98532, at *36 (N.D. Cal. Oct. 13, 2009).

8

4.

9

Plaintiff’s State-Law Warranty Claims Are Also Preempted.

Although Plaintiff’s broader preemption arguments are rebutted below (see pp. 13-15,

10

infra), Plaintiff does not deny that the SAC’s state-law warranty claims are the same as those this

11

Court already dismissed as preempted because they were tied to and could not be separated from

12

preempted attacks on the sufficiency of T-Mobile’s 3G network. Motion at 14-15. Tellingly,

13

Plaintiff quotes the Court’s ruling granting leave to assert different warranty claims based on

14

identifiable “actual defects” in the Nexus One and proclaims that this is what she has done, but

15

none of her bullet-pointed allegations supports any “actual defects” theory. Opp. at 5-6. In fact,

16

the SAC nowhere identifies and pleads any “actual defects” in the Nexus One – as distinct from

17

“T-Mobile’s insufficient infrastructure,” SAC, ¶ 88 – that supposedly caused the 3G connectivity

18

problems about which Plaintiff complains. Plaintiff elsewhere admits that she can only speculate

19

that there might be a defect in the device that “may” (or may not) cause or contribute in some

20

unspecific manner to the alleged problems. Opp. at 17.8 As Plaintiff admits, she “does not

21

know” one way or the other “whether the substantive failures” as to 3G connectivity “were

22

caused by [the Nexus One’s] software at all,” and the most she can say is that it “is possible that

23

her problems were caused by the Google Phone.” Id. at 18 (emphasis added). This is fatal for

24

two reasons. First, it confirms that Plaintiff’s “possible” defect allegations and warranty claims

25

are not the sort of “actual defects” claims that might escape preemption under the Court’s prior

26

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Moreover, even though Plaintiff purports to challenge “defects” in the Nexus One, she has
absolutely no response to Google and HTC’s argument that, as before, the claims are inextricably
intertwined with FCA preempted attacks on the adequacy of T-Mobile’s 3G network
infrastructure. Hence, the SAC’s claims remain preempted.
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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ruling. Nov. 16, 2010 Order, at 17 (emphasis added). Second, it compels dismissal of Plaintiff’s

2

claims under Twombly’s motion-to-dismiss standard, which requires Plaintiff to plead enough

3

well-pleaded facts to state a claim that is “plausible on its face,” Bell Atl. Corp. v. Twombly, 550

4

U.S. 544, 570 (2007), and “more than” the sort of “possibility” on which Plaintiff relies here. Id.

5

at 556; Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009); Moss v. U.S. Secret Serv., 572 F.3d 962,

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969 (9th Cir. 2009).

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5.

8
9

Plaintiff’s Federal Warranty Claim Under The Magnuson-Moss
Warranty Act Fails Along With Her Deficient State-Law Claims.

As Plaintiff admits, the Magnuson-Moss Warranty Act (“MMWA”) merely “‘provides a

10

federal cause of action for state law implied warranty claims.’” Opp. at 16 (quoting In re NVIDIA

11

GPU Litig., 2009 U.S. Dist. LEXIS 108500, at *24 (N.D. Cal. Nov. 19, 2009)). For the multiple

12

reasons stated above, Plaintiff’s implied warranty of merchantability claim fails, which mandates

13

dismissal of the SAC’s MMWA claim as well. See also Motion at 21.

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15
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C.

Plaintiff’s Negligence Claim Should Be Dismissed As Barred By The
Economic Loss Rule.

Plaintiff’s arguments as to why her negligence claim is not barred by the economic loss

17

rule are completely without merit. She does not deny that the economic loss rule requires

18

dismissal of negligence claims where the complaint fails to allege that the allegedly defective

19

product caused physical injury or damage to other property, i.e., damage to property other than

20

the product itself. Motion at 21-22 (citing cases); Opp. at 17-18; see also Jimenez v. Superior Ct.,

21

29 Cal. 4th 473, 483 (2002). Nor does she deny that the SAC’s negligence claim seeks recovery

22

of purely economic loss; indeed, nowhere does the SAC allege that the Nexus One caused

23

Plaintiff physical injury or damage to any of her other property. Hence, Plaintiff’s negligence

24

claim is barred under the rule that “[w]here a purchaser’s expectations in a sale are frustrated

25

because the product [s]he bought is not working properly, h[er] remedy is said to be in contract

26

alone, for [s]he has suffered only ‘economic’ losses.” Robinson Helicopter Co. v. Dana Corp., 34

27

Cal. 4th 979, 988-89 (2004). Indeed, Plaintiff’s negligence claim seeks recovery of purely

28

economic damages based on the SAC’s allegations that her expectations that the Nexus One
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SAN FRANCISCO

DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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would provide consistent 3G connectivity have been frustrated given how her device operates.

2

Trying to evade this legally compelled result, Plaintiff now pretends that the “product” at

3

issue here is not the Nexus One device itself, but instead the Nexus One’s software. Opp. at 17-

4

18. She then speculates that the software “may” (or may not) play some role in 3G connectivity

5

issues she allegedly experienced – saying that it is at least “possible.” Opp. at 17-18. But

6

Plaintiff’s argument fails for multiple reasons.

7

First, the allegations in the SAC do not support Plaintiff’s new theory that the “product” at

8

issue in this case is the Nexus One’s software, as opposed to the Nexus One device. The only

9

“product” discussed in the SAC is the Nexus One device. See generally SAC. The SAC nowhere

10

alleges that the Nexus One’s software is a distinct and separable component part that was

11

defective and damaged the Nexus One device. Notably, the Sixth Cause of Action for

12

“Negligence” does not even mention the Nexus One’s software. See SAC, ¶¶ 115-21. In fact,

13

nothing in the SAC supports counsel’s bare assertion that the Nexus One’s software is both the

14

allegedly “defective product,” Opp. at 18, and also “not so integrated” into the Nexus One “that it

15

loses its separate identity,” id., for purposes of the economic loss rule.9 At bottom, the product at

16

issue here is the product that is alleged in the SAC, and the product that was sold as a single

17

integrated unit: the Nexus One device. See also E. River S.S. Corp. v. Transamerica Delaval

18

Inc., 476 U.S. 858, 867 (1986).

19

Second, as noted above, Plaintiff’s speculation that it is “possible” that there might be

20

some unidentified defect in the Nexus One’s software that might play some unidentified role in

21

the alleged 3G connectivity problems (Opp. at 17-18) is the very sort of mere “possibility” that is

22

insufficient to state a claim that is “plausible on its face.” Twombly, 550 U.S. at 556, 570.10

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Plaintiff misleadingly quotes the phrase “the software is a mess” in the SAC as if it were an
affirmative allegation she made, see Opp. at 17, but in reality that phrase comes from a quote of
one 27-year old New Jersey consumer included in a New York Times article Plaintiff excerpted in
the SAC in a paragraph focused on the adequacy of “customer support.” SAC, ¶ 60. Moreover,
even saying that “the software is a mess” is insufficient, as it neither alleges nor even suggests
that the software is both legally “defective” and the cause of the Nexus One’s claimed 3G
connectivity problems (both of which are nowhere pleaded in the SAC).
10
Given the SAC’s fundamental pleading deficiencies under Twombly, Plaintiff is clearly wrong
to argue that the unpled issue of whether the software might be a separable product that is
“defective” and caused the alleged “consistent 3G connectivity” problems present disputed
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

1

Finally, despite Plaintiff’s failed analogy, this case bears no resemblance to In re NVIDIA

2

GPU Litig., 2009 U.S. Dist. LEXIS 108500 (N.D. Cal. Nov. 19, 2009). There, the plaintiffs sued

3

the manufacturer of “defective graphic processing units” and “chips” that were sold as distinct

4

products to third party computer manufacturers (e.g., Hewlett-Packard) who then used the GPUs

5

in computers sold to consumers. Id. at **4-6. Unlike here, the plaintiffs’ complaint in NVIDIA

6

alleged that the defendant’s GPUs were “defective” for specifically identified technical reasons.

7

Id. at **6-7. Also unlike here, the plaintiffs’ complaints alleged that the GPUs were the

8

“defective product” at issue, and that the defective GPUs caused many specifically identified

9

forms of damage to their computers, such as harm to the computer’s battery and other internal

10

components. Id. at **7-10. On these entirely different facts, this Court ruled that the plaintiffs

11

“adequately alleged that Defendant’s defective product (the GPU) caused damage to property

12

such as the CPU’s battery,” and therefore plaintiffs “alleged that the defective GPU has caused

13

damage to property other than itself.” Id. at *40.11

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In sum, Plaintiff’s negligence claim is barred by the economic loss rule and her attempts
to evade that rule are unavailing.
D.

Plaintiff’s Unjust Enrichment And Declaratory Relief Claims Should Be
Dismissed.

Plaintiff offers no defense for her duplicative “declaratory relief” claim. See Motion at 22

19

(citing authorities). Plaintiff admits that there is no cognizable claim for “unjust enrichment”

20

under California law, but suggests that her claim could simply be treated as synonymous with a

21

claim for equitable “restitution.” Opp. at 20. But Plaintiff ignores Google and HTC’s dispositive

22

argument that no “restitution” claim can be asserted where, as here, there exists an enforceable

23

agreement between the parties. Paracor Fin., Inc. v. GE Capital Corp., 96 F.3d 1151, 1167 (9th

24

factual issues for a jury to decide. Opp. at 18.
11
Plaintiff’s negligence claim is also unlike the “defective window installed in a mass-produced
home” that caused damage “to other parts of the home in which it [was] installed” in Jimenez
(cited by Plaintiff, Opp. at 17-18) – which was held to constitute a distinct and separable
“defective product” for purposes of the economic loss rule. 29 Cal. 4th at 483-84; see also id. at
485-88 (Kennard, J., concurrence) (“the windows may be regarded as a distinct product for
purposes of the economic loss rule” because they “may be readily separated from the overall unit”
of which they are just a readily severable part).
12

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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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Cir. 1996); Motion at 22 n.14; SAC, ¶ 100 (alleging existence of “agreements” with defendants).

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Plaintiff’s Ninth and Tenth Causes of Action must be dismissed.

3

E.

4

Plaintiff does not dispute that the SAC still does not allege that her Nexus One failed to

5

maintain “consistent” 3G connectivity due to “actual defects” in the device itself, as opposed to

6

deficiencies in the infrastructure of T-Mobile’s 3G wireless network. Plaintiff alleges that 3G

7

connectivity issues are caused either by some “possible” but unidentified defect in the device, or

8

by T-Mobile’s wireless network, or by “a combination of the two.” SAC ¶ 101; see also id., ¶ 70

9

(“the infrastructure of T-Mobile’s 3G wireless network and/or the Google phone itself were

All Of Plaintiff’s Claims Should Be Dismissed As Preempted By The FCA.

10

defective and inadequate”). Indeed, in the introduction to her Opposition, Plaintiff describes the

11

alleged connectivity problems as resulting from the fact that “[T-Mobile’s] network connectivity

12

did not offer a true 3G experience.” Opp. at 2.

13

Plaintiff does not dispute that these allegations, upon which all of her claims are based, are

14

the same as those that this Court held to be preempted under 47 U.S.C. § 332(c)(3) in both the

15

iPhone case and its prior ruling in this case. Instead, Plaintiff asserts that her claims are not

16

preempted under Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035 (9th Cir. 2010),

17

but based on her fundamental misreading of that case. In fact, Shroyer confirms – consistent with

18

the FCC’s own interpretation of Bastien v. AT&T Wireless Servs., Inc., 205 F.3d 983 (7th Cir.

19

2000) – that express FCA preemption under section 332(c) turns on the “substance” of the

20

particular claims at issue, and not merely their “form.” Shroyer, 622 F.3d at 1040. As Shroyer

21

notes, the plaintiffs’ claim in Bastien was preempted because it relied on state consumer

22

protection law in a manner that necessarily would embroil the court in determining the

23

sufficiency of AT&T’s network. Id. Hence, the substance of the claim implicated assessments

24

reserved for the FCC to make and thus preempted under section 332(c)(3).

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The Ninth Circuit held that the plaintiff’s breach of contract and fraud claims in Shroyer

26

were not preempted because the adequacy of the challenged service was to be measured against

27

specific contractual and other representations by AT&T regarding service levels. Id. The

28

contract claim required the court to determine only “whether New Cingular has performed its
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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

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promise in a contract,” and the fraud claim turned on a determination as to whether AT&T

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“misrepresented the level of service it would provide” measured against representations actually

3

made by AT&T and pled with Rule 9(b) particularity. Finally, the Ninth Circuit added that

4

“Bastien dealt with market entry,” while Shroyer’s non-preempted claims did not. Id. at 1040.

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Here, unlike the non-preempted claims in Shroyer, the substance of Plaintiff’s challenged

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state-law claims are inextricably intertwined with and cannot be separated from preempted

7

attacks on the sufficiency of the infrastructure and performance of carriers’ 3G wireless networks,

8

including their 3G “market entry” and “rates charged.” Motion at 14-15, 23; Nov. 16, 2010

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Order, at 17; In re Apple iPhone 3G Prods. Liab. Litig., No. 09-2045, slip op. at 9, 14 (N.D. Cal.

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April 2, 2010). Plaintiff’s continued inability to plead her misrepresentation-based allegations

11

about “consistent 3G connectivity” with Rule 9(b) particularity (see pp. 1-4, infra) not only

12

further distinguishes this case from Shroyer, but also makes her claims even more like the

13

preempted claims in Bastien where the plaintiffs similarly failed to plead any “particular promises

14

or representations” and “specific instances of the words used by” the defendant in support of their

15

conclusory “misrepresentation” allegations. Bastien, 205 F.3d at 889-90. Moreover, Plaintiff

16

ignores her own allegations that T-Mobile’s 3G network infrastructure is not only “insufficient”

17

(SAC, ¶ 88), but also “not designed to provide consistent connectivity to its 3G network for

18

Google Phone users.” SAC, ¶¶ 58-59. Nor does Plaintiff even respond to Google and HTC’s

19

argument that the SAC’s state-law claims will inescapably result in protracted litigation about the

20

adequacy of T-Mobile’s 3G infrastructure, as well as that of other carriers, and implicate

21

preempted assessments about each carrier’s 3G market entry and rates charged in connection with

22

3G service and the Nexus One. Motion at 15, 23. In short, the “substance” (Shroyer, 622 F.3d at

23

1040) of Plaintiff’s claims is what triggers express FCA preemption under 47 U.S.C. § 332(c)(3),

24

and Plaintiff’s attempt to elevate form over substance necessarily fails.

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F.

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Finally, Plaintiff’s suggestion that her ancillary “customer service” allegations are

27

independently actionable, and do not fall with her failed substantive claims, is meritless. Plaintiff

28

ignores the SAC’s failure to plead with Rule 9(b) particularity any instance in which Google and
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SAN FRANCISCO

Plaintiff’s Customer Service Allegations Cannot Support Any Viable Claim.

DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
Case No. CV-10-1177 JW

1

HTC misrepresented the customer service they would provide. Motion at 23. Plaintiff also cites

2

no authority for the proposition that Google and HTC violated any legal duty to provide what

3

Plaintiff believes to be adequate “customer service,”12 nor any authority for any breach of duty or

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compensable injury and damage here. Compare Motion at 24; with Opp. at 21-22. Instead,

5

Plaintiff tries to invoke the UCL’s “unfairness” prong, but disregards that any economic loss she

6

claims to have suffered was supposedly incurred “as a result” of her Nexus One purchase and not

7

any allegedly inadequate customer service. Motion at 24. Indeed, as Plaintiff does not dispute,

8

her frustration and mental distress are not compensable, id. n.16, and her cryptic reference to

9

“fees paid to [her] cellular service provider” during the period of any delay allegedly related to

10

customer-service issues (Opp. at 22) disregards that Plaintiff admittedly had a pre-existing,

11

independent “contract[ual]” obligation to pay her T-Mobile service fees. SAC, ¶ 49.

12

III.

13
14

CONCLUSION
For the foregoing reasons, and those set forth in Google and HTC’s opening brief,

Plaintiff’s Second Amended Complaint should be dismissed without leave to amend.

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16

Dated: April 18, 2011

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DECHERT LLP
By:
/s/ Steven B. Weisburd
.
STEVEN B. WEISBURD

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Respectfully submitted,

Attorneys for Defendant GOOGLE INC.
DATED: April 18, 2011

MUNGER, TOLLES & OLSON LLP

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By:

22

/s/ Rosemarie T. Ring
ROSEMARIE T. RING

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The one case Plaintiff cites, Roberts v. USSC Payroll Corp., 635 F. Supp. 2d 948, 951 (N.D.
Iowa 2009), is an employment discrimination case that neither holds nor suggests that sellers and
manufacturers of cellphones and electronic devices have a legal duty to provide “customer
service” as “intrinsic in the purchase of a product,” as Plaintiff states. Opp. at 21. Plaintiff
quotes from the decision’s factual background, where the court was merely describing what the
plaintiff’s job responsibilities entailed in working for a company that was presumably hired by
those who provide customer service as a customer courtesy, and not to discharge any legal duty.
See also Motion at 24 n.15.
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Attorneys for Defendant HTC CORPORATION

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CERTIFICATION
I, Matthew Larrabee, am the ECF User whose identification and password are being used
to file this Reply. In compliance with General Order 45.X.B., I hereby attest that Sara Avila and
Rosemarie T. Ring concurred in this filing.

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DEFENDANTS’ REPLY ISO MOTION TO DISMISS SECOND AMENDED COMPLAINT
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