Andrez Marquez v. Amazon.com, Inc. ( 2023 )

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[PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 21-14317
____________________
ANDREZ MARQUEZ,
On behalf of himself and all others similarly situated,
including but not limited to, Clarissa Morejon,
Morgan Howard, Sophia Feliciano, James Bromley,
and Jeff Barr,
CLARISSA MOREJON,
MORGAN HOWARD,
SOPHIA FELICIANO,
JAMES BROMLEY, et al.,
Plaintiffs-Appellants,
versus
AMAZON.COM, INC.,
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2 Opinion of the Court 21-14317
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Southern District of Florida
D.C. Docket No. 9:21-cv-80392-DMM
____________________
Before BRANCH and LUCK, Circuit Judges, and SANDS,∗ District
Judge.
BRANCH, Circuit Judge:
At the start of the COVID-19 pandemic, Amazon.com, Inc.
(“Amazon”) stopped providing “Rapid Delivery” 1 to Amazon
Prime (“Prime”) subscribers. Because Prime subscribers were not
notified of the suspension and continued to pay full price for their
memberships, Andrez Marquez and other plaintiffs brought a
putative class action against Amazon alleging breach of contract,
breach of the covenant of good faith and fair dealing, violation of
the Washington Consumer Protection Act (“WCPA”), and unjust
enrichment. The district court granted Amazon’s motion to
∗Honorable W. Louis Sands, United States District Judge for the Middle
District of Georgia, sitting by designation.
1
“Rapid Delivery” is not a contract term. The parties and the district court,
however, used the term to describe the enhanced shipping options available
to Prime subscribers. We follow suit.
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dismiss the First Amended Complaint for failure to state a claim
with prejudice because it found that Amazon did not have a duty
to provide unqualified Rapid Delivery to Prime subscribers. After
careful review, and with the benefit of oral argument, we affirm.
I. Background
A. Facts and Contract Terms
Prime is a fee-based subscription service. Prime subscribers
receive several benefits not available to other Amazon customers,
including Rapid Delivery, which is two-hour, same-day, one-day,
or two-day shipping at no additional cost for certain Prime-eligible
items purchased from Amazon’s online marketplace. From the
start of the COVID-19 pandemic in March 2020 to at least May
2020, Amazon suspended Rapid Delivery without notifying Prime
members. Plaintiffs alleged that, rather than providing the full
benefit of Prime membership to its subscribers, Amazon instead
“focused on profits from consumer grocery and pharmacy
spending to compete with major pharmacy and grocery chains as
well as keep[] up with significantly increased demand.” 2
As Prime subscribers, each plaintiff agreed to identical
contracts with Amazon. The contracts included the Amazon
Prime Terms and Conditions (“Terms & Conditions”) which, in
2
Amazon did not stop collecting subscription fees from existing Prime
subscribers during its suspension of Rapid Delivery. Rather, during this time,
Amazon sold new Prime subscriptions, listed goods as Prime-eligible, and
represented that it would provide Rapid Delivery.
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turn, incorporated provisions from several linked documents.
Specifically, in the first paragraph, the Terms & Conditions stated:
Please note that your use of the Amazon.com website
and Prime membership are also governed by the
agreements listed and linked to below, as well as
other applicable terms, conditions, limitations and
requirements on the Amazon.com website, all of
which . . . are incorporated into these Terms. If you sign
up for a Prime membership, you accept these terms,
conditions, limitations and requirements.
There were multiple hyperlinks immediately below this section of
text. In pertinent part, the first hyperlink incorporated the
“Conditions of Use” and the second incorporated the
“Amazon.com Privacy Notice.”
Within the Terms & Conditions was a bolded section
entitled “Shipping Benefits and Eligible Purchases.” This “Shipping
Benefits and Eligible Purchases” section included a hyperlink
entitled “Prime shipping benefits” that linked to a webpage entitled
“Amazon Prime Shipping Benefits – Eligible Items & Addresses.”
The “Amazon Prime Shipping Benefits – Eligible Items &
Addresses” webpage also linked to another webpage entitled
“Amazon Prime Shipping Benefits.” The “Amazon Prime Shipping
Benefits” webpage detailed shipping speeds, catalogued “eligible
items,” and provided the prices that Prime members would have
to pay for those services.
With the structure of the contract in mind, we now turn to
its operative text.
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First, the Terms & Conditions provided that: “Prime
shipping benefits depend[ed] upon inventory availability, order
deadlines, and in some cases the shipping address.” Second, the
Terms & Conditions provided: “[Amazon] may exclude products
with special shipping characteristics at [its] discretion.” Third, the
Terms & Conditions provided:
From time to time, Amazon may choose in its sole
discretion to add or remove Prime membership
benefits . . . [Amazon] may in [its] discretion
change . . . any aspect of Prime membership, without
notice . . . YOUR CONTINUED MEMBERSHIP
AFTER WE CHANGE THESE TERMS
CONSTITUTES YOUR ACCEPTANCE OF THE
CHANGES.
Additionally, the Conditions of Use provided (in all caps):
AMAZON SERVICES AND ALL INFORMATION,
CONTENT, MATERIALS, PRODUCTS
(INCLUDING SOFTWARE) AND OTHER
SERVICES INCLUDED OR OTHERWISE MADE
AVAILABLE TO YOU THROUGH THE AMAZON
SERVICES ARE PROVIDED BY AMAZON ON AN
“AS IS” AND “AS AVAILABLE” BASIS . . . .
The Conditions of Use also contained a choice-of-law clause
selecting Washington law. 3
3
The choice-of-law provision provided the following—“By using any Amazon
Service, you agree that . . . the laws of the state of Washington, without regard
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B. Procedural History
Plaintiffs were Prime subscribers between March 2020 and
May 2020 who—with one exception4—periodically placed orders
for Rapid Delivery. Plaintiffs filed this case in Florida state court.
Amazon removed to the United States District Court for the
Southern District of Florida based on diversity jurisdiction.
Plaintiffs then filed their First Amended Complaint, which
asserted claims for breach of contract (Claim I), breach of the
covenant of good faith and fair dealing (Claim II), violation of the
WCPA (Claim III), and unjust enrichment (Claim IV).
Importantly, plaintiffs did not plead the obvious: Amazon’s
suspension of Rapid Delivery was in response to the COVID-19
pandemic.5
to principles of conflict of laws, will govern these Conditions of Use and any
dispute of any sort that might arise between you and Amazon.”
4
For nine of the ten named plaintiffs, the First Amended Complaint alleges
that “[f]rom time to time [he or she] placed one or more orders on Amazon
Prime for Rapid Delivery.” For the other named plaintiff, however, the only
allegation is that he “utilized Rapid Delivery” without any allegation that he
actually placed orders for Rapid Delivery.
5
Presumably, plaintiffs omitted reference to COVID-19 in their complaint to
try to prevent the district court from considering COVID-19’s effect when
assessing the plausibility of their claims. See generally Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007). This ruse is creative lawyering, but it does not work.
While “[a]nalysis of a 12(b)(6) motion [to dismiss] is limited primarily to the
face of the complaint and attachments thereto,” Wilchombe v. TeeVee Toons,
Inc., 555 F.3d 949, 959 (11th Cir. 2009) (quoting Brooks v. Blue Cross & Blue
Shield of Fla., Inc., 116 F.3d 1364, 1368 (11th Cir. 1997)), the Supreme Court has
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Amazon moved to dismiss pursuant to Federal Rule of Civil
Procedure 12(b)(6), and the district court dismissed all claims with
prejudice for failure to state a claim. The district court held that,
on the breach of contract claim, “Plaintiffs [did] not ple[a]d facts
that establish[ed] that [Amazon] owed a duty to provide [Prime]
subscribers with unqualified rapid delivery shipping.” That is,
without a promise to provide unqualified Rapid Delivery, Amazon
necessarily did not breach its contract by suspending that service.
Relatedly, the district court found that the contract was neither
procedurally nor substantively unconscionable, and it specifically
“note[d] the irony” of plaintiffs’ argument that prioritizing the
shipment of essential goods during the COVID-19 pandemic was
unconscionable because Amazon “exercised responsible business
judgment during an unprecedented global public health crisis.” 6
Through reasoning similar to its breach of contract analysis, the
instructed courts that the plausibility determination is “context-specific” and
“requires the reviewing court to draw on its judicial experience and common
sense,” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009) (emphasis added); see also Roe
v. Michelin N. Am., Inc., 613 F.3d 1058, 1062 n.5 (11th Cir. 2010). The effect of
COVID-19 in early 2020 was properly considered as part of the district court’s
“judicial experience and common sense.” Iqbal, 556 U.S. at 679. As such,
plaintiffs’ argument that the district court—and our court—cannot consider
the effect of COVID-19 because it is not mentioned in their complaint
necessarily fails.
6
The district court advanced similar reasoning when it considered the “public
interest impact” element of the WCPA claim: “In addition, [d]efendant did not
violate the public interest—indeed it made a good faith effort to serve the
public interest—when it prioritized the shipment of essential goods during the
onset of the pandemic.”
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district court found that Claim II (breach of good faith and fair
dealing) and Claim III (violation of the WCPA) also failed. Finally,
the district court held that Claim IV (unjust enrichment) failed
because there was a contract between the parties; and, under
Washington law, unjust enrichment applies only when there is no
contractual relationship.
Plaintiffs timely appealed.
II. Standard of Review
“We review de novo the district court’s grant of a motion to
dismiss under Rule 12(b)(6) for failure to state a claim, accepting
the allegations in the complaint as true and construing them in the
light most favorable to the plaintiff.” Am. Dental Ass’n v. Cigna
Corp., 605 F.3d 1283, 1288 (11th Cir. 2010) (quoting Mills v. Foremost
Ins. Co., 511 F.3d 1300, 1303 (11th Cir. 2008)). But “[o]ur duty to
accept the facts in the complaint as true does not require us to
ignore specific factual details of the pleading in favor of general or
conclusory allegations,” because “when the exhibits contradict the
general and conclusory allegations of the pleading, the exhibits
govern.” Griffin Indus., Inc. v. Irvin, 496 F.3d 1189, 1205–06 (11th
Cir. 2007).
After Twombly and Iqbal, the standard to survive a 12(b)(6)
motion to dismiss for failure to state a claim is “plausibility.” See
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007); Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009). That is, “to survive a motion to dismiss,
a complaint must now contain sufficient factual matter, accepted
as true, to state a claim to relief that is plausible on its face.” Am.
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Dental, 605 F.3d at 1289 (quotations omitted). “A claim has facial
plausibility when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Iqbal, 556 U.S. at 678. This standard
requires plaintiffs to provide more than “naked assertions devoid
of further factual enhancement,” mere “labels and conclusions,” or
“a formulaic recitation of the elements of a cause of action.” Id.(quotations omitted & alterations adopted). Ultimately, “[a]
complaint may be dismissed for failure to state a claim when,
ignoring any mere conclusory statements, the remaining
allegations do not plausibly suggest that the defendant is liable.”
Harper v. Pro. Prob. Servs. Inc., 976 F.3d 1236, 1240 n.4 (11th Cir.
2020) (quotations omitted).
“[W]e may affirm [the district court’s] judgment on any
ground that finds support in the record.” Lucas v. W.W. Grainger,
Inc., 257 F.3d 1249, 1256 (11th Cir. 2001) (quotations omitted).
III. Discussion
To begin, we assume that Amazon’s contract with Prime
subscribers included a promise to provide Rapid Delivery. 7
7
We note that the district court did not employ this assumption, and the
assumption is by no means a given. On the one hand, the Amazon Prime
Shipping Benefits page stated: “Your Amazon Prime membership includes a
variety of shipping benefits, including several shipping options if you need to
expedite your delivery.” And this same page included a table showing the
expedited shipping speeds available to Prime members and the associated
costs (or lack thereof) for those services. These facts, along with plaintiffs’
allegations, suggest that Rapid Delivery was contractually promised. On the
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Proceeding from this assumption, we find that plaintiffs have not
stated a claim for breach of contract because Amazon had the right
to limit Rapid Delivery. We also hold that Amazon’s significant
discretionary authority over Rapid Delivery does not render the
contract unconscionable. Then, we conclude that plaintiffs have
not sufficiently alleged that Amazon breached its duty of good faith
or violated the WCPA. Finally, because plaintiffs pleaded a
contractual relationship in their unjust enrichment count, we hold
that their unjust enrichment claim fails. In sum, we affirm the
district court’s judgment on each claim, although we reach our
conclusions for different reasons.
A. Breach of Contract and Unconscionability
1. Breach of Contract
Plaintiffs allege that Amazon breached its contract with
plaintiffs by suspending Rapid Delivery from at least March 2020 to
at least May 2020. The district court found that Amazon had no
duty to provide unqualified Rapid Delivery and, as such, it did not
breach its contract by suspending that service.
other hand, however, many facts—such as the contractual terms that gave
Amazon “sole discretion” over Prime membership benefits and indicated that
Amazon provided its services on an “AS IS” and “AS AVAILABLE” basis—
indicate that Rapid Delivery was not contractually promised. In the end,
because we conclude that even if Rapid Delivery was contractually promised,
Amazon still did not breach its contract, breach the covenant of good faith, or
violate the WCPA, we assume that Rapid Delivery was promised.
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We take a different path. We assume that Amazon had a
duty to provide Rapid Delivery, but still conclude that Amazon did
not breach its contract because it had contractual authority to
suspend Rapid Delivery.
Under Washington law, 8 “[a] breach of contract is actionable
only if the contract imposes a duty, the duty is breached, and the
breach proximately causes damage to the claimant.” Nw. Indep.
Forest Mfrs. v. Dep’t of Lab. & Indus., 899 P.2d 6, 9 (Wash. Ct. App.
1995); see also Baldwin v. Silver, 269 P.3d 284, 289 (Wash. Ct. App.
2011) (“Breach of contract . . . claims depend on proof of four
common elements: duty, breach, causation, and damages.”). The
contract language is given its “ordinary, usual, and popular
meaning,” Myers v. State, 218 P.3d 241, 243 (Wash. Ct. App. 2009),
and courts must “give[] effect to all the contract’s provisions,”
Nishikawa v. U.S. Eagle High, LLC, 158 P.3d 1265, 1268 (Wash. Ct.
App. 2007). And, of course, if an action is permitted by the
contract, the performance of that action is not a breach. See Myers,
218 P.3d at 244 (upholding the trial court’s dismissal of a breach of
contract claim in a wrongful termination dispute when the
“contract grant[ed] [defendant] broad authority to terminate the
contract”).
The contract repeatedly qualified the rights of Prime
subscribers and gave Amazon the authority to modify Prime
benefits—including Rapid Delivery. In particular, we focus on two
8
The parties agree that we must apply Washington law in light of the choice-
of-law clause in their contract.
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terms that demonstrate Amazon did not breach its contract with
plaintiffs.
First, the Terms & Conditions provided that “Amazon may
choose . . . to add or remove Prime membership benefits.”
Second, the Conditions of Use reiterated that “AMAZON
SERVICES . . . ARE PROVIDED BY AMAZON ON AN ‘AS IS’
AND ‘AS AVAILABLE’ BASIS.” 9 Standing together, these terms
decide this claim. It is undisputable that the contract provides
Amazon with the right to suspend Rapid Delivery. We do not
belabor the point because the ultimate analysis is rather simple:
Amazon had the contractual right to suspend Rapid Delivery, so it
did not breach its contract with plaintiffs by suspending Rapid
Delivery. 10 Id.9
Amazon also points to the term providing that “shipping benefits depend upon
inventory availability, order deadlines, and in some cases the shipping address”
to show that plaintiffs did not have an unqualified right to Rapid Delivery.
Plaintiffs respond that this provision is inapposite because Amazon did not
suspend Rapid Delivery for the above-listed reasons. We need not address this
specific dispute because we conclude that other contract terms clearly provide
Amazon the right to suspend Rapid Delivery and, therefore, it did not breach
its contract with plaintiffs.
10
It bears repeating that plaintiffs were free to cancel their Prime memberships
at any time. If they chose not to cancel, however, their “continued
membership . . . constitute[d] . . . acceptance of the[] changes.” This
provision reinforces our conclusion that there was no breach. That is, once
plaintiffs accepted the new terms, they lost their claim that Amazon breached
the original terms.
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Plaintiffs argue that we cannot read the contractual
discretion so broadly because we must give “reasonable, fair, just,
and effective meaning to all manifestations of intention” when
interpreting a contract. See Spokane Sch. Dist. No. 81 v. Spokane Educ.
Ass’n, 331 P.3d 60, 67 (Wash. Ct. App. 2014). We conclude that this
statement of law actually cuts against plaintiffs’ argument. That is,
the contract’s express intention is to give Amazon broad authority
over Rapid Delivery, and it is “fair” and “reasonable” to read the
contract that way. Id.Plaintiffs also argue that if Amazon had such broad
discretion over Rapid Delivery—which, in their estimation, is the
“core” benefit of Prime membership—such authority would
render the contract “illusory.” “In Washington, a contract is
illusory only if it lacks all consideration and mutuality of obligation,
e.g., the promisor has no obligations with regard to any parts of the
contract.” Ekin v. Amazon Servs., LLC, 84 F. Supp. 3d 1172, 1176
(W.D. Wash. 2014). While this opinion has focused primarily on
Rapid Delivery, there are other Prime benefits and services (such
as streaming access for movies, television shows, and music) that
were not suspended. Thus, the contract was not “completely
illusory.” Id.
2. Unconscionability
Plaintiffs also contend that the contract is both procedurally
and substantively unconscionable and that the district court erred
in ruling otherwise. The district court found that the contract was
not procedurally unconscionable because “[p]laintiffs have not
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offered any facts that suggest they lacked a reasonable choice in
deciding whether or not to subscribe to [Prime],” and was not
substantively unconscionable because Amazon’s right to modify
the contract—which plaintiffs could have terminated at any time—
did not meet the high threshold for substantive unconscionability.
Ignoring the inherent tension in asserting a claim for breach of
contract (i.e., there is an enforceable contract that has been
breached) as well as a claim for unconscionability (i.e., this is an
unenforceable contract), plaintiffs’ argument fails.
“In Washington, either substantive or procedural
unconscionability is sufficient to void a contract.” Gandee v. LDL
Freedom Enters., Inc., 293 P.3d 1197, 1199 (Wash. 2013). “The
burden of proving that a contract or contract clause is
unconscionable lies upon the party attacking it.” Tjart v. Smith
Barney, Inc., 28 P.3d 823, 830 (Wash. Ct. App. 2001).
Plaintiffs allege that the contract is procedurally
unconscionable because “it was part of an adhesion contract, was
buried in a maze of fine print, and plaintiffs lacked a reasonable
opportunity to understand the provision[s].” Procedural
unconscionability is the lack of a meaningful choice, “considering
all the circumstances surrounding the transaction including (1) the
manner in which the contract was entered, (2) whether each party
had a reasonable opportunity to understand the terms of the
contract, and (3) whether the important terms [were] hidden in a
maze of fine print.” Id. (alterations adopted & quotations omitted).
Under the first element, to determine whether a contract is an
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adhesion contract, we consider: “(1) whether the contract is a
standard form printed contract, (2) whether it was prepared by one
party and submitted to the other on a take it or leave it basis, and
(3) whether there was no true equality of bargaining power
between the parties.” Zuver v. Airtouch Commc’ns., Inc., 103 P.3d
753, 760 (Wash. 2004) (quoting Yakima Cnty. (W. Valley) Fire Prot.
Dist. No. 12 v. City of Yakima, 858 P.2d 245, 248 (Wash. 1993))
(quotations omitted). Even if a contract is an adhesion contract,
that fact alone is not determinative. Romney v. Franciscan Med. Grp.,
349 P.3d 32, 37 (Wash. Ct. App. 2015) (“The fact that a contract is
an adhesion contract is relevant but not determinative.”).
Similarly, “the fact that unequal bargaining power exists will not,
standing alone, justify a finding of procedural unconscionability.”
Zuver, 103 P.3d at 761.
Plaintiffs are correct that the contract was an adhesion
contract. See id. The contract was a “standard form printed
contract,” prepared by Amazon, and plaintiffs have considerably
less bargaining power than Amazon. See id. This finding, however,
helps plaintiffs with only the first of the three elements of
procedural unconscionability. See Romney, 349 P.3d at 37.
Plaintiffs cannot satisfy their burden on the remaining
elements of procedural unconscionability. On the second element
(reasonable opportunity to understand the terms of the contract),
plaintiffs offer no explanation as to how their opportunity to
understand the contract was inhibited. As addressed below, the
terms were clearly laid out and there is no allegation (or evidence)
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that plaintiffs were under time pressure that affected their
opportunity to read the contract. Plaintiffs suggest that they
“lacked a reasonable opportunity . . . because [the provision
allowing Amazon to suspend Rapid Delivery] directly conflicts
with the actual core benefit offered: Rapid Delivery,” but this
argument misses the mark. For one, this argument does not
address plaintiffs’ opportunity to understand the contract in any
way. And, in any event, Amazon Prime membership included
other “core” benefits such as streaming access for movies,
television shows, and music which were unaffected by the
suspension of Rapid Delivery.
On the third element (hidden terms), despite plaintiffs’ claim
that the terms were buried in a maze of fine print, the evidence
again favors Amazon. While there were several hyperlinks
between different documents, the pertinent provisions were often
in prominent places under clearly labeled subheadings, written in
clear language, and/or emphasized in all caps.
In sum, while plaintiffs have plausibly alleged that the
contract was an adhesion contract, they have not carried their
burden of alleging the remaining elements of procedural
unconscionability. See Tjart, 28 P.3d at 830.
Plaintiffs also allege that the contract is “substantively
unconscionable because it purported to confer on Amazon
unfettered discretion to unilaterally modify the contract.”
“Substantive unconscionability involves those cases where a clause
or term in the contract is alleged to be one-sided or overly harsh[.]”
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Adler v. Fred Lind Manor, 103 P.3d 773, 781 (Wash. 2004). “[T]erms
sometimes used to define substantive unconscionability” include
“[s]hocking to the conscience, monstrously harsh, and exceedingly
calloused.” Id. (quotations omitted). “[U]nilateral change-in-terms
provision[s]” do not render a contract substantively
unconscionable unless the contract is completely illusory, which
occurs only when the contract “lacks all consideration and
mutuality of obligation, e.g., the promisor has no obligations with
regard to any parts of the contract.” Ekin, 84 F. Supp. 3d at 1176;
see also Associated Petroleum Prods., Inc. v. Nw. Cascade, Inc., 203 P.3d
1077, 1080 (Wash. Ct. App. 2009) (“A party to a terminable at will
contract can unilaterally modify the contract because, in doing so,
the party is simply terminating the old contract and offering a new
one.”).
Plaintiffs cannot satisfy this demanding standard. Under the
contract, Amazon had authority to suspend certain Prime benefits,
but the terms were far from “monstrously harsh” or “shock[ing]
[to] the conscience.” Adler, 103 P.3d at 781. Instead, the terms
provided the benefits of Prime, described Amazon’s authority to
alter those benefits, and gave plaintiffs the option to cancel their
Prime membership at any time.
In the end, Amazon’s contractual discretion was substantial,
but the contract was not procedurally or substantively
unconscionable under Washington law.11 See id.
Because we find that the provisions allowing Amazon to suspend Rapid
11
Delivery are not unconscionable, we do not address plaintiffs’ argument that
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B. Breach of Duty of Good Faith and Fair Dealing
Plaintiffs argue that because the contract gave Amazon
significant discretionary authority, it was required—under
Washington law—to operate according to the duty of good faith
and fair dealing. The district court held that Amazon had no duty
to provide Rapid Delivery and, therefore, plaintiffs did not show
that “there [was] anything that [Amazon] . . . failed to perform in
good faith.” Again, we do not follow the district court’s approach
to duty. Nonetheless, after analyzing the contract’s terms and
comparing them with Washington law, we find that plaintiffs have
not sufficiently alleged that Amazon violated the duty of good faith
and fair dealing.
“Under Washington law, there is in every contract an
implied duty of good faith and fair dealing that obligates the parties
to cooperate with each other so that each may obtain the full
benefit of performance.” Rekhter v. State, Dep’t of Soc. & Health
Servs., 323 P.3d 1036, 1041 (Wash. 2014) (quotations, alterations,
and citations omitted). The covenant “requires only that the
parties perform in good faith the obligations imposed by their
agreement,” and does not “inject substantive terms into the parties’
contract.” Badgett v. Sec. State Bank, 807 P.2d 356, 360 (Wash. 1991)
(quotations omitted); Myers, 218 P.3d at 244 (“[C]ovenants of good
faith . . . do not trump express terms or unambiguous rights in a
contract.”). Critically, however, “if a contract gives a party
the unconscionable portions should be severed from the rest of the still-
operative contract.
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unconditional authority to determine a term, there is no duty of
good faith and fair dealing.” Rekhter, 323 P.3d at 1044.
Plaintiffs are correct on one point: Amazon had substantial
discretion under the contract. Under Rekhter, however,
unconditional authority to determine a term effectively cancels the
duty of good faith and fair dealing. Id. Per the terms of the
contract, Amazon “may choose in its sole discretion to add or
remove Prime membership benefits,” which is the quintessential
case of a “contract [that] gives a party unconditional authority.”
Accordingly, we must find that “there is no duty of good faith and
fair dealing” under Washington law. Id. Further, the contract
specified that Prime services were provided on an “AS IS” and “AS
AVAILABLE” basis and it notified plaintiffs that if they disagreed
with any updated terms they were required to “cancel [their]
memberships.” Amazon did not breach the duty of good faith and
fair dealing because it was non-existent in this instance.12
C. Violation of WCPA
We turn now to plaintiffs’ argument that Amazon violated
a Washington state statute—the WCPA—by engaging in deceptive
practices. Wash. Rev. Code Ann. §§ 19.86.010–19.86.920. The
12
Plaintiffs argue that the district court erred in analyzing the duty of good
faith because it rooted its analysis in the fact that “no contract provision
imposed on Amazon a duty to provide Rapid Delivery.” This argument does
not affect our analysis because (1) we have analyzed duty differently than the
district court and (2) it would not change Washington law which gets rid of
the duty of good faith in this circumstance.
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20 Opinion of the Court 21-14317
district court held that plaintiffs did not allege facts showing that
Amazon engaged in an unfair or deceptive practice.
The WCPA allows out-of-state plaintiffs to sue Washington
corporations for “deceptive acts that directly or indirectly affect the
people of Washington.” Thornell v. Seattle Serv. Bureau, Inc., 363
P.3d 587, 592 (Wash. 2015). Plaintiffs must establish five elements
to prevail in a WCPA suit: “(1) [an] unfair or deceptive act or
practice; (2) occurring in trade or commerce; [that has a] (3) public
interest impact; [that results in] (4) [an] injury to plaintiff in his or
her business or property; [and] (5) causation.” Hangman Ridge
Training Stables, Inc. v. Safeco Title Ins. Co., 719 P.2d 531, 533 (Wash.
1986); see also Wash. Rev. Code Ann. §§ 19.86.010–19.86.920. Our
analysis leads inescapably to the conclusion that the district court
correctly dismissed this claim.
1. Unfair or Deceptive Act or Practice
Under this element, the touchstone is whether a
representation was “likely to mislead a reasonable consumer.”
Panag v. Farmers Ins. Co. of Wash., 204 P.3d 885, 895 (Wash. 2009)
(quotations omitted). “A plaintiff need not show that the act in
question was intended to deceive, but that the alleged act had the
capacity to deceive a substantial portion of the public.” Hangman
Ridge, 719 P.2d at 535. “The capacity . . . to deceive is determined
with reference to the least sophisticated consumers among us.”13
13
Amazon contends that the “least sophisticated” standard does not apply to
the WCPA. This argument, however, rests on an unpublished opinion that is
not entirely persuasive. See Kelly v. Cavalry Portfolio Servs. LLC, No. 47941-9-II,
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21-14317 Opinion of the Court 21
Keithly v. Intelius Inc., 764 F. Supp. 2d 1257, 1268 (W.D. Wash. 2011)
(noting as well that “[online] consumers do not read every word
on a webpage and [the Federal Trade Commission] advises
advertisers that they must draw attention to important disclosures
to ensure that they are seen”). Even still, a representation that does
not “hid[e] the ball in any way,” HB Dev., LLC v. W. Pac. Mut. Ins.,
86 F. Supp. 3d 1164, 1187 (E.D. Wash. 2015), is not unfair or
deceptive—despite the impact that those terms may have on the
consumer—because “[p]erfection is not the standard,” Keithly, 764
F. Supp. 2d at 1269.
Plaintiffs unconvincingly argue there are three ways that
Amazon engaged in an “unfair or deceptive” act or practice as
alleged in the First Amended Complaint: (1) by breaching its
contract and the duty of good faith, (2) by representing that it
would provide Rapid Delivery, and (3) by not representing that it
could suspend Rapid Delivery without notification or refund in
order to “compete against other companies, including grocery and
2016 WL 7468227, at *4 (Wash. Ct. App. Dec. 28, 2016). Other Washington
cases suggest that the “least sophisticated” standard is properly applied to
claims under the WCPA. See, e.g., Panag, 204 P.3d at 895 (including as part of
its overview of the proper standards in a WCPA case that the court “look not
to the most sophisticated readers but rather to the least” (quoting Jeter v. Credit
Bureau, Inc., 760 F.2d 1168, 1175 (11th Cir. 1985) (emphasis added)). Because
plaintiffs cannot even satisfy the “least sophisticated” standard, we assume
without deciding that this lower threshold is the proper standard under
Washington law.
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22 Opinion of the Court 21-14317
pharmacy companies” and “promote sales with higher profit
margins.”
The first argument has already been addressed. Amazon did
not breach its contract or the duty of good faith. Thus, we turn to
plaintiffs’ second and third arguments. In essence, both arguments
are that “the least sophisticated consumer” was “likely to [be]
misl[ed]” by the contract’s terms.
While the contract contained a large amount of text and in
some cases required reference to other terms (via hyperlink), the
critical provisions would not deceive a “substantial portion of the
public” even if the “least sophisticated” consumer is the
benchmark. Hangman Ridge, 719 P.2d at 535; Panag, 204 P.3d at 895.
Amazon’s discretionary authority to suspend Rapid Delivery was
made exceedingly clear from the outset. The provisions that
outline this discretion were easy to understand. Two of the most
important provisions—concerning Amazon’s power to alter
subscribers’ memberships and emphasizing that its services were
provided on an “AS IS” and “AS AVAILABLE” basis—were
emphasized in all caps. This set of facts in no way resembles
“hid[ing] the ball” because the provisions were easily accessible and
straightforward; as such, they would not deceive a “substantial
portion” of the public. HB Dev., 86 F. Supp. 3d at 1185, 1187(holding that “[t]here [was] no evidence that [defendants] hid the
ball” because the pertinent language was presented clearly and
defendants did not neglect to disclose critical information). For
these reasons, Amazon’s representations were not “unfair” or
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21-14317 Opinion of the Court 23
“deceptive.” 14 See, e.g., Keithly, 764 F. Supp. 2d at 1269 (“Perfection
is not the standard . . . .”).
Simply put, plaintiffs have not sufficiently alleged that
Amazon engaged in “unfair or deceptive” business practices under
Washington law. This conclusion alone defeats plaintiffs’ WCPA
claim because they cannot satisfy each of the five required
elements. Even so, we proceed to another element to emphasize
that plaintiffs’ claim is doubly deficient.
2. Public Interest Impact
To succeed on a WCPA claim, plaintiffs must also
demonstrate a “public interest impact.” Hangman Ridge, 719 P.2d
at 533, 537 (emphasizing the WCPA’s focus of “protect[ing] the
general public”). This element may be satisfied in multiple ways,
id. at 538, but the Washington legislature has instructed that “this
act shall not be construed to prohibit acts or practices which are
reasonable in relation to the development and preservation of
business or which are not injurious to the public interest,” Wash.
Rev. Code Ann. § 19.86.920. Plaintiffs argue that Amazon’s
suspension of Rapid Delivery was a breach that affected “millions”
of people such that it affected the public interest. Plaintiffs’
argument is paradoxical. Essentially, plaintiffs contend that by
14
To the extent that plaintiffs’ third argument (that Amazon did not represent
that it could suspend Rapid Delivery to concentrate on groceries and
pharmaceuticals) includes their contention that the district court erred by
considering the realities of COVID-19, we have already found that argument
meritless.
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24 Opinion of the Court 21-14317
suspending Rapid Delivery to prioritize essential goods at the
outset of the COVID-19 pandemic, Amazon harmed the public
interest. As we have explained, we are allowed to use our
“experience and common sense” to acknowledge the COVID-19
pandemic even though it was not included as a factual allegation in
the First Amended Complaint. See Iqbal, 556 U.S. at 679. We need
only common sense to dispense with this argument because
Amazon’s prioritization of essential goods during the COVID-19
pandemic obviously did not harm the public interest. 15
For the reasons above, we hold that the district court was
correct to dismiss plaintiffs’ WCPA claim.
D. Unjust Enrichment
Plaintiffs’ claim that Amazon was unjustly enriched because
it received plaintiffs’ subscription fees without conferring the
benefit of Rapid Delivery is a non-starter. Washington law is clear
that unjust enrichment is appropriate only absent a contract. See
Young v. Young, 191 P.3d 1258, 1262 (Wash. 2008) (“Unjust
enrichment is the method of recovery for the value of the benefit
retained absent any contractual relationship . . . .” (emphasis added));
see also Pengbo Xiao v. Feast Buffet, Inc., 387 F. Supp. 3d 1181, 1190–
91 (W.D. Wash. 2019) (“Under Washington law . . . [w]here a valid
contract governs the rights and obligations of the parties, unjust
15
Plaintiffs also face obstacles on the injury and causation elements. It is
unnecessary to address these issues given plaintiffs’ failure to satisfy the
preceding elements.
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21-14317 Opinion of the Court 25
enrichment does not apply.”). Plaintiffs, however, specifically
incorporated the terms of their contract with Amazon as part of
their unjust enrichment count. So, while plaintiffs may plead
breach of contract and unjust enrichment in the alternative, see,
e.g., Fed. R. Civ. P. 8(d)(2)–(3), they have not done so. Instead,
plaintiffs pleaded a contractual relationship as part of their unjust
enrichment claim, and that contractual relationship defeats their
unjust enrichment claim under Washington law. 16 Young, 191 P.3d
at 1262; see also Gociman v. Loyola Univ. of Chicago, 41 F.4th 873, 887
(7th Cir. 2022) (“[A] party may not incorporate by reference
allegations of the existence of a contract between the parties in the
unjust enrichment count.”).
IV. Conclusion
Plaintiffs ask us to ignore the plain meaning of the contract
they agreed to, forget the worldwide effect of the COVID-19
pandemic, and reverse the district court’s dismissal. We decline
their request.
Accordingly, we affirm the district court’s dismissal of
plaintiffs’ First Amended Complaint for failure to state a claim with
prejudice.
AFFIRMED.
16
To the extent plaintiffs argue there was not an enforceable contract
(unconscionability), we have already dispensed with that argument.