Gadomski v. Equifax Information Services LLC ( 2020 )


Menu:
  • 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA 9 10 KELLIE GADOMSKI, individually and on No. 2:17-cv-00670-TLN-AC behalf of all others similarly situated, 11 Plaintiff, 12 ORDER v. 13 EQUIFAX INFORMATION SERVICES, 14 LLC, 15 Defendant. 16 17 This matter is before the Court pursuant to Defendant Equifax Information Services, 18 LLC’s (“Defendant”) Motion to Dismiss and Strike Plaintiff’s Class Allegations. (ECF No. 30.) 19 Plaintiff Kellie Gadomski (“Plaintiff”) filed an opposition. (ECF No. 31.) Defendant filed a 20 reply. (ECF No. 34.) For the reasons set forth below, the Court DENIES Defendant’s motion. 21 /// 22 /// 23 /// 24 /// 25 /// 26 /// 27 /// 28 /// 1 I. FACTUAL AND PROCEDURAL BACKGROUND 2 Plaintiff resides in Tracy, California. (ECF No. 27 at 5.) She is a “consumer” as that term 3 is defined by California Civil Code § 1785.3(b) and 15 U.S.C. § 1681a(c). (Id.) Defendant is a 4 corporation authorized to do business in the State of California, with a primary corporate address 5 in Atlanta, Georgia. (Id.) Defendant is a “consumer reporting agency” (“CRA”) within the 6 meaning of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681a(f), because it uses means 7 and facilities of interstate commerce for the purpose of furnishing credit reports. (Id.) 8 Plaintiff alleges that around September 2009, she opened an account with Wells Fargo for 9 a consumer credit card. (Id. at 22.) On or about 2012, Plaintiff fell behind on her payments, 10 leading Wells Fargo to “charge off” her account around August 2012. (Id.) On April 24, 2013, 11 Plaintiff filed a “no asset” Chapter 7 bankruptcy in the U.S. Bankruptcy Court for the Eastern 12 District of California. (Id. at 19.) As a result of the filing, the bankruptcy court allegedly 13 discharged the Wells Fargo account. (Id. at 20.) 14 According to Plaintiff, Wells Fargo incorrectly informed Defendant that Plaintiff’s 15 account was “charged off” or otherwise past due/unpaid rather than “Discharged in Bankruptcy.” 16 (Id. at 22–23.) Plaintiff alleges Defendant failed to realize Plaintiff’s debt was subject to 17 bankruptcy and erroneously listed Plaintiff’s discharged debt as due and owing in the “Public 18 Records” section of Plaintiff’s credit report. (Id.) Plaintiff alleges that in a consumer report dated 19 November 13, 2016, Defendant therefore inaccurately reported that the “current (pay) status” on 20 Plaintiff’s account was “charged off” as of December 2012. (Id.) 21 Later in November 2016, Plaintiff sent a letter to Defendant requesting that it remove the 22 reported Wells Fargo information. (Id. at 25–26.) Defendant timely forwarded the dispute to 23 Wells Fargo, and Wells Fargo reaffirmed the reported information. (Id.) Around December 15, 24 2016, Defendant notified Plaintiff of the results of the reinvestigation. (Id. at 26.) After 25 Defendant’s reinvestigation of Plaintiff’s dispute, it continued to incorrectly list Plaintiff’s current 26 pay status as “charged off” as opposed to discharged in Plaintiff’s bankruptcy. (Id.) 27 In her First Amended Complaint (“FAC”), Plaintiff brings four causes of action against 28 Defendant: (1) willful failure to employ reasonable procedures to assure maximum possible 1 accuracy of credit reports in violation of 15 U.S.C. § 1681e(b) (“§ 1681e(b)”); (2) negligent 2 failure to employ reasonable procedures to assure maximum possible accuracy of credit reports in 3 violation of § 1681e(b); (3) willful failure to reasonably reinvestigate in violation of 15 U.S.C. § 4 1681i(a) (“§1681i(a)”); and (4) negligent failure to reasonably reinvestigate in violation of § 5 1681i(a). (Id. at 35–40.) 6 Plaintiff seeks to represent a purported nationwide class and two purported nationwide 7 subclasses. (Id. at 29.) The purported class includes Chapter 7 and Chapter 13 debtors who have 8 had a consumer report relating to them prepared by Defendant in which “one or more . . . 9 tradeline accounts or debts was not reported as discharged.” (Id.) The alleged “Dispute 10 Subclass” includes the same debtors whose allegedly discharged debts “continued to be 11 erroneously reported by [Defendant]” after they disputed those debts. (Id. at 31.) Finally, the 12 alleged “Public Record Subclass” includes debtors “whose record of Chapter 7 and Chapter 13 13 Bankruptcies fail to report in the ‘Public Records’ section of [Defendant’s] credit reports any 14 time.” (Id. at 33.) 15 All four of Plaintiff’s claims are brought against Defendant on behalf of Plaintiff and all 16 Class Members, including the Dispute and Public Record Subclass Members. Plaintiff alleges 17 Defendant violated both her and Class Members’ statutory rights to be able to apply for credit 18 based on accurate information. (Id. at 19.) Specifically, Plaintiff alleges that as a result of 19 Defendant’s inaccurate reporting and unreasonable reinvestigation procedures, she and Class 20 Members are at increased risk of not being able to obtain valuable credit and their 21 creditworthiness has been adversely affected. (Id.) 22 Defendant filed the instant motion on July 18, 2018. (ECF No. 30.) In its motion, 23 Defendant moves to dismiss Plaintiff’s § 1681e(b) claims (Claims One and Two) pursuant to 24 Federal Rule of Civil Procedure (“Rule”) 12(b)(6) and also to strike Plaintiff’s class allegations 25 pursuant to Rule 12(f) and Rule 23.1 (Id.) 26 1 It bears mentioning that the Court granted in part and denied in part Defendant’s previous 27 motion to dismiss and strike based on substantially similar arguments. (See ECF No. 26.) The Court granted Defendant’s motion to dismiss Plaintiff’s § 1681e(b) claims with leave to amend 28 and denied Defendant’s motion to strike the class allegations. (Id. at 12.) 1 II. STANDARDS OF LAW 2 A. Motion to Dismiss Pursuant to 12(b)(6) 3 A motion to dismiss for failure to state a claim under Rule 12(b)(6) tests the legal 4 sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Federal Rule of 5 Civil Procedure 8(a) requires that a pleading contain “a short and plain statement of the claim 6 showing that the pleader is entitled to relief.” See Ashcroft v. Iqbal, 556 U.S. 662, 678–79 7 (2009). Under notice pleading in federal court, the complaint must “give the defendant fair notice 8 of what the claim . . . is and the grounds upon which it rests.” Bell Atlantic v. Twombly, 550 U.S. 9 544, 555 (2007) (internal quotation omitted). “This simplified notice pleading standard relies on 10 liberal discovery rules and summary judgment motions to define disputed facts and issues and to 11 dispose of unmeritorious claims.” Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512 (2002). 12 On a motion to dismiss, the factual allegations of the complaint must be accepted as true. 13 Cruz v. Beto, 405 U.S. 319, 322 (1972). A court is bound to give plaintiff the benefit of every 14 reasonable inference to be drawn from the “well-pleaded” allegations of the complaint. Retail 15 Clerks Int’l Ass’n v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963). A plaintiff need not allege 16 “‘specific facts’ beyond those necessary to state his claim and the grounds showing entitlement to 17 relief.” Twombly, 550 U.S. at 570. “A claim has facial plausibility when the plaintiff pleads 18 factual content that allows the court to draw the reasonable inference that the defendant is liable 19 for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. 544, 556 (2007)). 20 Nevertheless, a court “need not assume the truth of legal conclusions cast in the form of 21 factual allegations.” United States ex rel. Chunie v. Ringrose, 788 F.2d 638, 643 n.2 (9th Cir. 22 1986). While Rule 8(a) does not require detailed factual allegations, “it demands more than an 23 unadorned, the defendant–unlawfully–harmed–me accusation.” Iqbal, 556 U.S. at 678. A 24 pleading is insufficient if it offers mere “labels and conclusions” or “a formulaic recitation of the 25 elements of a cause of action.” Twombly, 550 U.S. at 555; see also Iqbal, 556 U.S. at 678 26 (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory 27 statements, do not suffice.”). Moreover, it is inappropriate to assume that the plaintiff “can prove 28 facts that it has not alleged or that the defendants have violated the . . . laws in ways that have not 1 been alleged[.]” Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 2 459 U.S. 519, 526 (1983). 3 Ultimately, a court may not dismiss a complaint in which the plaintiff has alleged “enough 4 facts to state a claim to relief that is plausible on its face.” Iqbal, 556 U.S. at 697 (quoting 5 Twombly, 550 U.S. at 570). Only where a plaintiff has failed to “nudge[] [his or her] claims . . . 6 across the line from conceivable to plausible[,]” is the complaint properly dismissed. Id. at 680. 7 While the plausibility requirement is not akin to a probability requirement, it demands more than 8 “a sheer possibility that a defendant has acted unlawfully.” Id. at 678. This plausibility inquiry is 9 “a context–specific task that requires the reviewing court to draw on its judicial experience and 10 common sense.” Id. at 679. 11 If a complaint fails to state a plausible claim, “‘[a] district court should grant leave to 12 amend even if no request to amend the pleading was made, unless it determines that the pleading 13 could not possibly be cured by the allegation of other facts.’” Lopez v. Smith, 203 F.3d 1122, 14 1130 (9th Cir. 2000) (en banc) (quoting Doe v. United States, 58 F.3d 484, 497 (9th Cir. 1995)); 15 see also Gardner v. Marino, 563 F.3d 981, 990 (9th Cir. 2009) (finding no abuse of discretion in 16 denying leave to amend when amendment would be futile). Although a district court should 17 freely give leave to amend when justice so requires under Rule 15(a) (2), “the court’s discretion 18 to deny such leave is ‘particularly broad’ where the plaintiff has previously amended its 19 complaint[.]” Ecological Rights Found. v. Pac. Gas & Elec. Co., 713 F.3d 502, 520 (9th Cir. 20 2013) (quoting Miller v. Yokohama Tire Corp., 358 F.3d 616, 622 (9th Cir. 2004)). 21 B. Motion to Dismiss Pursuant to 12(f) 22 The Court “may strike from a pleading an insufficient defense or any redundant, 23 immaterial, impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f). “As with motions to 24 dismiss, when ruling on a motion to strike, the Court takes the plaintiff’s allegations as true[.]” 25 Tietsworth v. Sears, 720 F. Supp. 2d 1123, 1146 (N.D. Cal. 2010). Similarly, the Court “must 26 view the pleading in the light most favorable to the nonmoving party.” Cholakyan v. 27 MercedesBenz USA, LLC, 796 F. Supp. 2d 1220, 1245 (C.D. Cal. 2011). “Motions to strike are 28 generally disfavored because they are often used as delaying tactics and because of the limited 1 importance of pleadings in federal practice.” Shaterian v. Wells Fargo Bank, N.A., 829 F. Supp. 2 2d 873, 879 (N.D. Cal. 2011) (internal quotation omitted). “If there is any doubt whether the 3 portion to be stricken might bear on an issue in the litigation, the court should deny the motion.” 4 Holmes v. Elec. Document Processing, Inc., 966 F. Supp. 2d 925, 930 (N.D. Cal. 2013). 5 Courts have recognized that class action allegations may sometimes be properly stricken 6 at the pleading stage. See, e.g., Kamm v. Cal. City Dev. Co., 509 F.2d 205, 209–13 (9th Cir. 7 1975); see generally Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 160 (1982) (“Sometimes the 8 issues are plain enough from the pleadings to determine whether the interests of absent parties are 9 fairly encompassed within the named plaintiff’s claim.”). However, Ninth Circuit precedent 10 stands “for the unremarkable proposition that often the pleadings alone will not resolve the 11 question of class certification and that some discovery will be warranted.” Vinole v. Countrywide 12 Home Loans, Inc., 571 F.3d 935, 942 (9th Cir. 2009). District courts have broad discretion to 13 control the class certification process, including whether to permit discovery in connection with 14 class certification. See id. 15 III. ANALYSIS 16 A. Motion to Dismiss § 1681e(b) Claims 17 Defendant makes two main arguments as to why Plaintiff cannot prevail on her § 18 1681e(b) claims. First, Defendant argues Plaintiff fails to allege Defendant lacks reasonable 19 procedures to assure maximum possible accuracy in consumer reports. (ECF No. 30 at 15.) 20 Second, Defendant argues Plaintiff fails to allege a willful violation of § 1681e(b). (Id. at 19.) 21 The Court will address Defendant’s arguments in turn. 22 i. Reasonable procedures under § 1681e(b) 23 Section 1681e(b) provides: “Whenever a consumer reporting agency prepares a consumer 24 report it shall follow reasonable procedures to assure maximum possible accuracy of the 25 information concerning the individual about whom the report relates.” 15 U.S.C. § 1681e(b). 26 “[T]o make a prima facie violation under § 1681e(b), a consumer must present evidence tending 27 to show that a credit reporting agency prepared a report containing inaccurate information.” 28 Guimond v. Trans Union Credit Info. Co., 45 F.3d 1329, 1333 (9th Cir. 1995). “The FCRA does 1 not impose strict liability, however — an agency can escape liability if it establishes that an 2 inaccurate report was generated despite the agency’s following reasonable procedures.” Id. “[A] 3 credit reporting agency is not liable under the FCRA for reporting inaccurate information 4 obtained from a [presumptively reliable source], absent prior notice . . . that the information may 5 be inaccurate.” Wright v. Experian Info. Sols., Inc., 805 F.3d 1232, 1241 (10th Cir. 2015) 6 (quotation omitted). 7 Defendant argues this case involves “at most, an alleged one-off error” and Plaintiff fails 8 to allege Defendant lacks reasonable procedures to assure maximum possible accuracy in 9 consumer reports.2 (ECF No. 30 at 11.) While Defendant acknowledges Plaintiff added new 10 allegations to her FAC to address deficiencies in her original complaint on this issue, Defendant 11 argues Plaintiff’s new allegations about what constitutes “reasonable procedures” under the 12 FCRA are unprecedented and impose an “impossible standard.” (Id. at 16–17.) Defendant then 13 argues even if the FCRA did require Defendant to adopt Plaintiff’s proposed procedures, 14 Plaintiff’s allegations suggest Defendant already implements those procedures. (Id. at 17.) 15 Lastly, Defendant argues it cannot be liable for reporting inaccurate information obtained from 16 Wells Fargo because Plaintiff has not identified any facts or authority to suggest Defendant 17 should have known Wells Fargo was an unreliable source. (Id. at 17–18.) 18 In opposition, Plaintiff points to several new facts added to her FAC to support her 19 allegation that Defendant failed to follow reasonable procedures in her case. Plaintiff alleges 20 information relating to whether a debt has been reaffirmed or successfully challenged is 21 retrievable from PACER and LexisNexis through automated, computerized means. (ECF No. 27 22 at ¶ 131.) Plaintiff also alleges although Defendant affirmatively seeks out and obtains public 23 records from PACER and LexisNexis, Defendant has failed to consistently report the public 24 record of bankruptcies for its consumers to determine whether certain debts have been 25 discharged. (Id. at ¶¶ 79, 129.) Plaintiff alleges Defendant instead reports pre-bankruptcy 26 information furnished by consumers’ creditors even if that information ignores or contradicts 27 2 Defendant does not dispute that the information reported on Plaintiff’s credit report was 28 inaccurate. See Guimond, 45 F.3d at 1333. 1 information contained in easily obtained public court records. (Id. at ¶ 78.) According to 2 Plaintiff, a reasonable investigation would have led Defendant consulting with PACER or 3 LexisNexis to determine that Plaintiff had a successful bankruptcy discharge. (Id. at ¶ 150.) 4 Plaintiff notes that two other CRAs, Experian and TransUnion, reported Plaintiff’s bankruptcy in 5 the “Public Records” sections of their respective credit reports during the same reporting time 6 frame, which further bolsters her claim that Defendant failed to adopt reasonable procedures to 7 assure maximum possible accuracy. (Id. at ¶ 130.) 8 Plaintiff also adds facts to support the allegation that Defendant knew Wells Fargo was an 9 unreliable source and the information obtained from Wells Fargo was inaccurate prior to issuing 10 Plaintiff’s credit report. Plaintiff alleges that over the past several years, thousands of consumers 11 have written dispute letters to Defendant requesting that Defendant correct its erroneous reporting 12 of discharged debts as due and owing because those debts had, in fact, been discharged in 13 bankruptcy and have named Wells Fargo as the furnisher of the inaccurate reporting. (Id. at ¶ 14 91.) Plaintiff alleges that, as a result, there have been thousands of consumer complaints to 15 regulators and agencies such as the Better Business Bureau, Federal Trade Commission, and 16 Consumer Financial Protection Bureau, as well as lawsuits filed against Wells Fargo and 17 Defendant based on identical reporting violations discussed in the FAC. (Id. at ¶ 92.) Plaintiff 18 therefore alleges Defendant knows, or should know, that the information creditors like Wells 19 Fargo furnish regarding the status of prebankruptcy debts is highly unreliable and that its 20 procedures for reporting such debts thus fail to assure maximum possible accuracy. (Id.) 21 The Court finds Plaintiff’s new factual allegations plausibly allege Defendant failed to 22 follow reasonable procedures under § 1681e(b). Although Defendant argues Plaintiff’s 23 allegations seem to suggest Defendant generally follows reasonable procedures by seeking out 24 information from PACER and LexisNexis, § 1681e(b) requires Defendant to “follow reasonable 25 procedures to assure maximum possible accuracy of the information concerning the individual 26 about whom the report relates.” 15 U.S.C. § 1681e(b) (emphasis added). Plaintiff’s new 27 allegations provide at the very least a reasonable inference that Defendant did not follow 28 reasonable procedures in her case because, had Defendant checked PACER or LexisNexis, 1 presumably it would have seen the results of Plaintiff’s bankruptcy and updated her records 2 accordingly. Indeed, Plaintiff’s allegation that Experian and TransUnion did not make the same 3 error also leads to a reasonable inference that Defendant failed to follow reasonable procedures in 4 Plaintiff’s case. Further, Plaintiff’s allegations about the numerous dispute letters and consumer 5 complaints regarding Wells Fargo’s inaccurate reporting suggest Wells Fargo was not a 6 presumptively reliable source and Defendant had prior notice that information from Wells Fargo 7 may be inaccurate. See Wright, 805 F.3d at 1241. 8 Defendant essentially challenges the reasonableness of the procedures alleged by Plaintiff 9 and whether Defendant followed those procedures. However, the Ninth Circuit has emphasized 10 “[t]he reasonableness of the procedures and whether the agency followed them will be jury 11 questions in the overwhelming majority of cases.” See Guimond, 45 F.3d at 1333. At this early 12 stage, the Court must take Plaintiff’s allegations as true and draw all reasonable inferences in her 13 favor. See Cruz, 405 U.S. at 322; see also Retail Clerks, 373 U.S. at 753 n.6. For the reasons 14 discussed above, the Court finds the FAC plausibly alleges Defendant failed to follow reasonable 15 procedures to assure maximum possible accuracy in Plaintiff’s case. Accordingly, the Court 16 rejects Defendant’s first basis for dismissal. 17 ii. Willfulness 18 Defendant next argues that, at a minimum, Plaintiff fails to allege a willful violation of § 19 1681e(b). (ECF No. 30 at 19.) In opposition, Plaintiff points to many of the same allegations 20 discussed above and argues she sufficiently alleged willfulness. (ECF No. 31 at 20.) 21 “[W]illfulness under the FCRA ‘cover[s] not only known violations of [the statute], but 22 reckless ones as well.’” Robbins v. CitiMortgage, Inc., No. 16-CV-04732-LHK, 2017 WL 23 6513662, at *19 (N.D. Cal. Dec. 20, 2017) (citing Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 57 24 (2007)). “The common law has generally understood ‘recklessness’ in the civil liability sphere as 25 conduct violating an objective standard: action entailing an unjustifiably high risk of harm that is 26 either known or so obvious that it should be known.” Safeco, 551 U.S. at 49 (citation and internal 27 quotation marks omitted). 28 1 The thrust of Defendant’s argument is that it did not act recklessly because the FCRA 2 does not require Defendant to “pore through PACER” to determine whether a debt has been 3 discharged. (ECF No. 30 at 20.) As already stated, however, the Court must take Plaintiff’s 4 allegations as true and give her the benefit of all reasonable inferences. See Cruz, 405 U.S. at 5 322; see also Retail Clerks, 373 U.S. at 753 n.6. To summarize, Plaintiff alleges the information 6 Defendant possessed in its records would have enabled it to confirm the status of Plaintiff’s 7 bankruptcy through services like LexisNexis or PACER. (ECF No. 27 at ¶¶ 131, 150.) Plaintiff 8 further alleges that despite knowing of and generally using LexisNexis and PACER, Defendant 9 failed to use those services in Plaintiff’s case and instead relied on Wells Fargo’s inaccurate 10 report. (Id. at ¶¶ 78, 79, 129.) Finally, Plaintiff alleges that previous disputes and consumer 11 complaints about Wells Fargo’s inaccurate reporting put Defendant on notice that information 12 furnished by Wells Fargo was unreliable. (Id. at ¶¶ 91, 92.) 13 Whether Defendant’s actions rise to a willful violation is ultimately a question of fact to 14 be determined by a jury. For purposes of ruling on the instant motion, Plaintiff’s factual 15 allegations support a reasonable inference that Defendant knew or should have known there was 16 an “unjustifiably high” risk that relying on information from Wells Fargo and failing to check 17 PACER or LexisNexis would result in an inaccurate credit report. See Safeco, 551 U.S. at 49. As 18 such, the Court finds Plaintiff plausibly alleges that Defendant willfully violated § 1681e(b). 19 Accordingly, Defendant’s motion to dismiss is DENIED. 20 B. Defendant’s Motion to Strike Plaintiff’s Class Allegations 21 Defendant moves to strike Plaintiff’s nationwide class allegations for two reasons: (1) 22 determining whether each class members’ report contained inaccurate information will require an 23 individualized inquiry; and (2) the Court lacks personal jurisdiction over any claims not arising 24 from Defendant’s conduct in California. (ECF No. 30 at 21–22.) 25 As with its order on Defendant’s prior motion (see ECF No. 26 at 11–12), the Court again 26 declines to strike class allegations at this early stage. As the Court previously explained, “striking 27 is severe and disfavored,” and “many courts have declined to so rule solely on the basis of the 28 allegations in a complaint, preferring to address the propriety of the class action at a later stage in 1 the litigation.” (ECF No. 26 at 12 (quoting Khorrami v. Lexmark Int’l Inc., No. CV 07-01671 2 DDP (RCx), 2007 WL 8031909, at *2 (C.D. Cal. Sept. 13, 2007); Cholakyan, 796 F. Supp. 2d at 3 1245 (“[While] class allegations can be stricken at the pleadings stage, it is in fact rare to do so in 4 advance of a motion for class certification.”).) 5 As to Defendant’s personal jurisdiction argument, the Court acknowledges the law is 6 unclear as to whether the Court may exercise personal jurisdiction over the claims of unnamed, 7 non-California class members. Defendant argues the Supreme Court’s decision in Bristol-Myers 8 applies here. Bristol-Myers Squibb Co. v. Super. Ct. of Cal., S.F. Cty., 137 S. Ct. 1773, 1781 9 (2017) (holding due process did not permit the exercise of specific personal jurisdiction over the 10 claims of named, nonresident consumers in a mass tort action). But Bristol-Myers dealt with a 11 mass tort action with individually named plaintiffs, and the Court did not address whether its 12 holding applied to class actions. Id. at 1789 n.4 (Sotomayor, J., dissenting) (“The Court today 13 does not confront the question whether its opinion here would also apply to a class action in 14 which a plaintiff injured in the forum State seeks to represent a nationwide class of plaintiffs, not 15 all of whom were injured there.”). 16 Moreover, the relevant case law has developed significantly since the parties briefed the 17 instant motion in 2018. “While some courts have applied Bristol-Myers to class actions, others 18 have not.” King v. Bumble Trading, Inc., No. 18-CV-06868-NC, 2020 WL 663741, at *4 (N.D. 19 Cal. Feb. 11, 2020) (internal citations omitted); see also Goldstein v. Gen. Motors LLC, No. 3:19- 20 CV-01778-H-AHG, 2020 WL 1849659, at *4 (S.D. Cal. Apr. 13, 2020) (collecting cases). “The 21 Ninth Circuit and the Supreme Court . . . have yet to decide this issue.” King, 2020 WL 663741, 22 at *4. However, at least two circuits recently confronted the issue in ways that are potentially 23 persuasive here. See Molock v. Whole Foods Mkt. Grp., Inc., 952 F.3d 293, 298 (D.C. Cir. 2020) 24 (affirming denial of a motion to dismiss class allegations for lack of personal jurisdiction because 25 “[p]utative class members become parties to an action — and thus subject to dismissal — only 26 after class certification”); see also Mussat v. IQVIA, Inc., 953 F.3d 441, 447 (7th Cir. 2020) 27 (“[N]amed representatives must be able to demonstrate either general or specific personal 28 1 jurisdiction, but the unnamed class members are not required to do so.”). The Court believes that 2 these developments warrant updated briefing at the class certification stage. 3 For these reasons, the Court declines to strike Plaintiff’s class allegations at this early 4 stage. See Vinole, 571 F.3d at 942 (“District courts have broad discretion to control the class 5 certification process.”); see also Cole v. Asurion Corp., No. CV 06-6649PSGJTLX, 2008 WL 6 5423859, at *14 (C.D. Cal. Dec. 30, 2008) (“[T]he Court is reluctant to preemptively deny 7 Plaintiff at least the opportunity to present a motion for class certification.”). As such, the Court 8 DENIES Defendant’s Motion to Strike Plaintiff’s Class Allegations without prejudice. 9 IV. CONCLUSION 10 For the reasons set forth above, Defendant’s Motion to Dismiss and Strike Plaintiff’s 11 Class Allegations is DENIED. (ECF No. 30.) Defendant shall file a responsive pleading within 12 twenty-one (21) days of the date of electronic filing of this Order. 13 IT IS SO ORDERED. 14 DATED: July 6, 2020 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Document Info

Docket Number: 2:17-cv-00670

Filed Date: 7/8/2020

Precedential Status: Precedential

Modified Date: 6/19/2024