Turnier v. Bed Bath & Beyond Inc. ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 ROBERT TURNIER, et al., Case No.: 3:20-cv-00288-L-MSB 12 Plaintiffs, 13 v. ORDER GRANTING DEFENDANT’S MOTION TO DISMISS [ECF 22] 14 BED BATH & BEYOND INC., WITH LEAVE TO AMEND. 15 Defendant. 16 17 Pending before the Court in this putative class action is Defendant’s motion to 18 dismiss. Plaintiffs opposed, and Defendant replied. The Court decides the matter without 19 oral argument. See Civ. L. R. 7.1. For the reasons stated below, the Court GRANTS 20 Defendant’s motion WITH LEAVE TO AMEND. 21 I. BACKGROUND 22 Plaintiffs filed this action in state court. (See Doc. No. 1). Defendant removed it 23 here. Id.; see 28 U.S.C. section 1453. The Court has subject matter jurisdiction under 28 24 U.S.C. section 1332. 25 Defendant is a New York corporation that markets and sells household 26 merchandise. (Doc. No. 18, First Amended Complaint (“FAC.”) ¶ 4). It sells merchandise 27 in its stores and online. (Id. at ¶ 11). For 29 dollars a year, customers can enroll in Beyond 28 + (also referred to as “the membership”), which offers them a 20 percent discount on all 1 purchases and “free” shipping. (Id. at ¶ 13). Beyond + automatically renews each year. 2 (Id. at ¶¶ 11-17). 3 On August 11, 2018, Plaintiff Robert Turnier purchased an item from Defendant 4 on its website and enrolled in Beyond +. (Id. at ¶ 15). The enrollment cost was $31.25 5 (the $29 fee plus taxes). (Id. at ¶ 16). Turnier was charged that amount again in 2019 and 6 2020. (Id. at ¶ 17). 7 On August 12, 2019, Plaintiff Beatrice Moran purchased an item from Defendant. 8 (Id. at ¶ 19). Defendant did not disclose it enrolled Moran in Beyond +. Id. On August 10, 9 2020, Defendant charged Moran $31.97. (Id. at ¶ 20). 10 Plaintiffs allege Defendant failed to disclose information on Beyond +’s 11 autorenewal terms as required under California’s Automatic Renewal Law (“ARL”) (Cal. 12 Bus. & Prof. Code § 17600). 13 II. LEGAL STANDARD 14 A complaint must contain a “short and plain statement of the claim showing that 15 the pleader is entitled to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009) (internal 16 quotation marks and citation omitted). “A pleading that offers ‘labels and conclusions’ or 17 ‘a formulaic recitation of the elements of a cause of action will not do.’” Id. at 678 18 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). The allegations “must be 19 enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. 20 The Court must accept as true all factual allegations in the complaint and draw 21 reasonable inferences from those allegations in the light most favorable to the plaintiff. 22 See Skilstaf, Inc. v. CVS Caremark Corp., 669 F.3d 1005, 1014 (9th Cir. 2012). The 23 Court must also “draw on its judicial experience and common sense.” Iqbal, 556 U.S. at 24 679. 25 26 27 28 1 III. DISCUSSION 2 Defendant argues Plaintiffs failed to state a plausible claim under California’s 3 Consumers Legal Remedies Act (“CLRA”), Unfair Competition Law (“UCL”), or False 4 Advertising Law (“FAL”).1 5 Consumers Legal Remedies Act 6 CLRA prohibits businesses from engaging in certain unlawful acts or practices. 7 Cal. Civ. Code § 1770. It applies to transactions for “goods” or “services.” Id. Defendant 8 argues the membership is neither. (ECF 22). 9 “Goods” means tangible chattels bought or leased for personal, family, or 10 household purposes, including certificates or coupons exchangeable for those chattels. 11 Cal. Civ. Code § 1761. “Services” means work, labor, and services for other than a 12 commercial or business use, including services furnished in connection with the sale or 13 repair of goods. Id. 14 Plaintiffs argue the membership is a “coupon,” and therefore a “good” under 15 CLRA. (ECF 23). But, as alleged, the membership (and its 20 percent discount) is not 16 exchanged for tangible items. See Cal. Civ. Code § 1761. Instead, it provides members 17 with a set discount on all purchases. (See FAC). 18 Plaintiffs also argue the membership is a “service” because members receive “free” 19 standard shipping for all purchases. (ECF 23). The Court agrees that shipping might be 20 considered a service. Even so, as alleged, that service is not provided under the 21 membership. (See FAC). Instead, it eliminates the cost to members. Iqbal, 556 U.S. at 22 679 (courts must draw on their “common sense” when determining whether a claim is 23 plausible). For these reasons, the Court dismisses the CLRA claim. 24 25 26 27 1 Defendant also argues the UCL claim was dismissed with prejudice. (ECF 22). But the Court granted 28 1 Unfair Competition Law and False Advertising Law 2 The available remedies under UCL and FAL include injunctive relief and 3 restitution. In re Vioxx Class Cases, 180 Cal. App. 4th 116, 135 (2009). Plaintiffs request 4 a full refund from Defendant. (FAC at ¶¶ 35 and 50).2 Defendant argues Plaintiffs failed 5 to allege a plausible entitlement to that relief. (ECF 22); Iqbal, 556 U.S. at 677-678; 6 Twombly, 550 U.S. at 555. 7 “The difference between what the plaintiff paid and the value of what the plaintiff 8 received is a proper measure of restitution.” In re Vioxx Class Cases, 180 Cal. App. at 9 131; Pulaski & Middleman, LLC v. Google, Inc., 802 F.3d 979, 988 (9th Cir. 2015) 10 (“restitution is the return of the excess of what the plaintiff gave the defendant over the 11 value of what the plaintiff received.”) (internal quotation marks and citation omitted); 12 Dunkin v. Boskey, 82 Cal. App. 4th 171, 198 (2000) (“a party seeking restitution must 13 generally return any benefit that it has received.”) (internal quotations marks and citation 14 omitted).3 15 Here, the Court cannot infer from the factual allegations that Plaintiffs lacked 16 access to the membership’s benefits or knowledge about their re-enrollment. (See FAC). 17 And the membership at renewal had some value (access to discounts on all purchases and 18 “free” shipments). Id.4 Plaintiffs also do not argue the ARL violations altered the value of 19 the renewed memberships. (See FAC); Pulaski & Middleman, LLC, 802 F.3d at 989 20 (“restitution is based on what a purchaser would have paid at the time of purchase had the 21 purchaser received all the information.”) Overall, the factual allegations fail to support a 22 plausible claim for restitution.5 For that reason, the Court dismisses the UCL and FAL 23 24 25 2 Plaintiffs do not seek injunctive relief in this action. (See FAC). 3 If a good or service had zero value, a plaintiff might be entitled to a full refund. In re Tobacco Case II, 26 240 Cal. App. 4th 779, 795 (2015). That is the same measurement as the one in In re Vioxx (amount paid minus value received). 27 4 The renewal charge was the same amount Plaintiff Turnier paid for his initial membership. (See FAC). The benefits were also identical. Id. 28 1 claims. Plaintiffs need to set forth a plausible claim for restitution supported with factual 2 || allegations. [gbal, 556 U.S. at 677-78. 3 Judicial Notice 4 Defendant requests judicial notice of terms and conditions that purportedly relate 5 ||to the Beyond + enrollment. (See ECF 22). The Court’s ruling does not rely on that 6 ||document. Therefore, the request is DENIED. 7 Leave to Amend 8 Plaintiffs might cure the above deficiencies if given leave to amend. The Court 9 || therefore GRANTS their request. See Fed. R. Civ. P. 15; Lopez v. Smith, 203 F.3d 1122, 10 || 1127 (9th Cir. 2000). Plaintiffs have leave to amend their allegations to support the 11 |}CLRA, UCL, and FAL claims. 12 IV. CONCLUSION 13 For the reasons stated above, the Court GRANTS Defendant’s motion to dismiss 14 || WITH LEAVE TO AMEND. Plaintiffs have until October 1, 2021, to file an amended 15 ||complaint. Defendant shall have the time set forth under Federal Rule of Civil Procedure 16 || 15(a)(3) to file a response.° 17 IT IS SO ORDERED. 18 || Dated: September 15, 2021 Y J 19 YY fw sawp itp 20 HOnMt James CorenzH 54 United States District Judge 22 23 24 25 26 || 27 Defendant cited factual assertions in its motion that are not contained in the FAC. (See ECF 22 at 8 and 28 12). The Court did not consider those when ruling on Defendant’s motion. Defendant should exclude that in subsequent motions.