Alan Vitt v. Apple Computer, Inc.

FILED
UNITED STATES COURT OF APPEALS FEB 28 2012
MOLLY C. DWYER, CLERK
FOR THE NINTH CIRCUIT U.S . CO U RT OF AP PE A LS
ALAN VITT, Individually and on Behalf No. 10-55941
of All Others Similarly Situated,
D.C. No. 2:06-cv-07152-GW-
Plaintiff - Appellant, FMO
Central District of California,
v. Los Angeles
APPLE COMPUTER, INC., a California
corporation, ORDER
Defendant - Appellee.
Before: NOONAN, GOULD, and IKUTA, Circuit Judges.
The memorandum in the above-captioned matter filed on December 21,
2011 is AMENDED. The amended memorandum shall be filed concurrently with
this order.
With these changes, the panel has unanimously voted to deny the petition for
panel rehearing. Judges Gould and Iµuta have voted to deny the petition for
rehearing en banc, and Judge Noonan so recommends. The full court has been
advised of the petition for rehearing en banc and no judge has requested a vote on
whether to rehear the matter en banc. Fed. R. App. P. 35. The Petition of
Appellant for Rehearing and Suggestion for Hearing En Banc is DENIED. No
future petitions for rehearing or rehearing en banc will be entertained.
FILED
NOT FOR PUBLICATION FEB 28 2012
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S . CO U RT OF AP PE A LS
FOR THE NINTH CIRCUIT
ALAN VITT, Individually and on Behalf No. 10-55941
of All Others Similarly Situated,
D.C. No. 2:06-cv-07152-GW-
Plaintiff - Appellant, FMO
v. AMENDED
MEMORANDUM *
APPLE COMPUTER, INC., a California
corporation,
Defendant - Appellee.
Appeal from the United States District Court
for the Central District of California
George H. Wu, District Judge, Presiding
Argued and Submitted December 6, 2011
Pasadena, California
Before: NOONAN, GOULD, and IKUTA, Circuit Judges.
Appellant Alan Vitt ('Vitt') appeals the district court's Fed. R. Civ. P.
12(b)(6) dismissal of his second amended complaint against Apple Computer Co.
('Apple') alleging violations of California consumer protection law on behalf of
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
all purchasers of the iBooµ G4 Laptop Computer ('the iBooµ G4').1 The crux of
Vitt's contention, building on his dissatisfaction that his iBooµ G4 failed shortly
after his one year warranty had expired, is that the iBooµ G4 does not last 'at least
a couple of years,' which he alleges a reasonable consumer expects from a laptop.
Vitt alleges that this is because one of the solder joints on the logic board of the
iBooµ G4 degrades slightly each time the computer is turned on and off, eventually
causing the joint to breaµ and the computer to stop worµing shortly after Apple's
one year express warranty has expired. Vitt further alleges that Apple
affirmatively misrepresented the durability, portability, and quality of the iBooµ
G4 and did not disclose the alleged defect. The district court held that Apple's
affirmative statements were non-actionable puffery, and that Apple had no duty to
disclose the alleged defect under Daugherty v. American Honda Motor Co., 144
Cal. App. 4th 824 (2006).
We affirm for substantially the reasons given by the district court, which
thoughtfully addressed the controlling issues of California law. In a different
context we have held that to be actionable as an affirmative misrepresentation, a
1
Vitt alleges violations of the California Unfair Competition Law, Cal. Bus.
& Prof. Code. y 17200 et seq., the California False Advertising Law, Cal. Bus. &
Prof. Code. y 17500 et seq., and the California Consumer Legal Remedies Act,
Cal. Civ. Code y 1750 et seq.
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statement must maµe a 'specific and measurable claim, capable of being proved
false or of being reasonably interpreted as a statement of objective fact.' Coastal
Abstract Serv. v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999).
California courts have also held that þmere puffingþ cannot support liability under
California consumer protection law. See Consumer Advocates v. Echostar Satellite
Corp., 113 Cal. App. 4th 1351, 1361 n.3 (2003) (citing Hauter v. Zogarts, 14
Cal.3d 104, 111 (1975)). Vitt challenges Apple's advertising because it stated that
the iBooµ G4 is 'mobile,' 'durable,' 'portable,' 'rugged,' 'built to withstand
reasonable shocµ,' 'reliable,' 'high performance,' 'high value,' an 'affordable
choice,' and an 'ideal student laptop.' The district court held that these statements
are generalized, non-actionable puffery because they are 'inherently vague and
generalized terms' and 'not factual representations that a given standard has been
met.' We agree. Even when viewed in the advertising context as Vitt urges, these
statements do not claim or imply that the iBooµ G4's useful life will extend for 'at
least a couple of years.' For example, to the extent that 'durable' is a statement of
fact it may imply in context that the iBooµ G4 is resistant to problems occurring
because of its being dropped, but not that it will last for a duration beyond its
expressed warranty.
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Vitt also contends that Apple had an affirmative duty to disclose the alleged
defect. The district court dismissed these claims under Daugherty, 144 Cal. App.
4th 824, and subsequent federal cases applying its reasoning to class actions where
laptop computers failed as a result of alleged design defects. Oestreicher v.
Alienware Corp., 544 F. Supp. 2d 964, 969-70 (N.D. Cal. 2008), aff'd 322 Fed.
Appx. 489 (9th Cir. 2009) (holding that there was no omission cause of action
because any defects manifested after expiration of the warranty period); Hoey v.
Sony Elecs. Inc., 515 F. Supp. 2d 1099, 1104-05 (N.D. Cal. 2007) (holding that
there was no omission cause of action for alleged soldering defect in laptop
computer); Long v. Hewlett-Pacµard Co., No. 06-02816, 2007 WL 2994812, at *8
(N.D. Cal. July 27, 2007), aff'd 316 Fed. Appx. 585 (9th Cir. 2009) ('HP is not
alleged to have made any representation as to the life of [its laptop computers]. As
such, a consumer's only reasonable expectation was that the [computers] would
function properly for the duration of HP's limited one-year warranty. HP fulfilled
this expectation.'). These federal cases persuasively read Daugherty to hold that
there is no duty to disclose that a product may fail beyond its warranty period
absent an affirmative misrepresentation or a safety risµ.
Vitt argues that Apple has an affirmative duty to disclose a defect because it
has 'exclusive µnowledge of material facts not µnown to the plaintiff,' namely that
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the iBooµ G4 has a defective logic board, and it 'actively concealed' that fact,
relying on LiMandri v. Judµins 52 Cal. App. 4th 326, 336-37 (1997). Judµins is a
common law fraud case, but a recent California case has applied its reasoning to
the California consumer protection laws that Vitt alleges Apple has violated here.
Collins v. eMachines, Inc., 202 Cal. App. 4th 249, 255-56 (2011). In Collins, the
plaintiffs brought a lawsuit on behalf of themselves and all similarly situated
California residents who allegedly purchased computers with defective floppy disµ
controllers. According to the complaint, the defendants µnew that the computers
contained a defective microchip that caused them to improperly read data from
floppy disµs, resulting in data corruption, and yet the defendants continued to
include a written warranty that the computers were 'free from defects in materials
and worµmanship under normal use for a period of one year from the date of
purchase.' Id. at 253. The California Court of Appeals reversed a lower court's
dismissal of the plaintiffs' California Consumer Legal Remedies Act and Unfair
Competition Law claims, holding that the complaint adequately alleged that the
defendants had 'exclusive µnowledge of material facts not µnown or reasonably
accessible to the plaintiff' and that the defendant had actively concealed those
facts. Id. at 255-56. The court distinguished Daugherty because plaintiffs were
'not attempt[ing] an end-around the warranty laws.' Id. at 257. The court quoted
5
with approval plaintiffs' argument that this is 'not a situation where the
[micro]chip is complete and operational when sold, but wears out or breaµs over
time because of use and [wear and tear]' but rather a situation where the alleged
defect 'results from [computer hardware] logic that was never installed on the
chip, thus rendering the chip susceptible to corrupting data and failure to meet
industry standards the instant the chip was manufactured.' Id. (emphasis and
alterations in original).
By contrast, the defect alleged in this case is that one of the iBooµ G4's
components 'wears out or breaµs over time because of use' at a rate faster than
consumers would reasonably expect. Id. Vitt alleges that when this component
breaµs the computer no longer worµs, but the defect is not alleged to have any
effect on the iBooµ G4's functionality until it fails. Adopting Vitt's theory would
effectively extend Apple's term warranty to 'at least a couple of years' based on
subjective consumer expectations. See Oestreicher, 544 F. Supp. 2d at 971-72.
We would be surprised if the California Supreme Court found such an extension in
the consumer protection laws at issue here. See Seely v. White Motor Co., 63
Cal.2d 9, 18 (1965) ('[A consumer can] be fairly charged with the risµ that the
product will not match his economic expectations unless the manufacturer agrees
that it will.'). Accordingly, Collins is not applicable here. We agree with the
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district court that Apple was under no duty to disclose the alleged defect in its
iBooµ G4s.
Vitt's argument that Apple's express warranty is procedurally and
substantially unconscionable because it is an exculpatory contract that has the
effect of 'releasing [Apple] from responsibility for its own fraud' is without merit.
AFFIRMED.
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