Case 2:19-cv-10899-MWF-RAO Document 125 Filed 08/02/21 Page 1 of 22 Page ID #:1522
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`Tina Wolfson (SBN 174806)
`Theodore W. Maya (SBN 223242)
`Bradley K. King (SBN 274399)
`Rachel R. Johnson (SBN 331351)
`AHDOOT & WOLFSON, PC
`2600 West Olive Avenue, Suite 500
`Burbank, California 91505
`(310) 474-9111; Fax: (310) 474-8585
`twolfson@ahdootwolfson.com
`tmaya@ahdootwolfson.com
`bking@ahdootwolfson.com
`rjohnson@ahdootwolfson.com
`
`
`
`
`
`
`Hassan A. Zavareei (SBN 181547)
`TYCKO & ZAVAREEI LLP
`
`1828 L Street NW, Suite 1000
`Washington, D.C. 20036
`
`(202) 973-0900; Fax (202) 973-0950
`hzavareei@tzlegal.com
`
`
`Daniel S. Robinson (SBN 244245)
`Wesley K. Polischuk (SBN 254121)
`Michael W. Olson (SBN 312857)
`ROBINSON CALCAGNIE, INC.
`19 Corporate Plaza Drive
`Newport Beach, CA 92660
`(949) 720-1288; Fax (949) 720-1292
`drobinson@robinsonfirm.com
`wpolischuk@robinsonfirm.com
`molson@robinsonfirm.com
`
`Interim Co-Lead Counsel for Plaintiffs and the
`Classes
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`
`
`
`In re Ring LLC Privacy Litigation
`
`
`This Document Relates To:
`All Actions.
`
`
`
`
`
`
`
`
`Master File No.: 2:19-cv-10899 MWF
`(RAOx)
`
`PLAINTIFFS’ OPPOSITION TO
`DEFENDANT’S MOTION TO
`STAY
`
`DATE: August 23, 2021
`TIME: 10:00 a.m.
`JUDGE: Hon. Michael W. Fitzgerald
`CTRM: 5A
`
`
`
`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
`No. 2:19-cv-10899-MWF (RAOx)
`
`
`
`

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`Case 2:19-cv-10899-MWF-RAO Document 125 Filed 08/02/21 Page 2 of 22 Page ID #:1523
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`
`I.
`II.
`
`TABLE OF CONTENTS
`INTRODUCTION .................................................................................................... 1
`RING FAILED TO DEMONSTRATE THAT A STAY PENDING
`APPEAL IS WARRANTED .................................................................................... 2
`A.
`Legal Standard .................................................................................................. 2
`B.
`Ring Has Not Demonstrated That Its Appeal Presents Serious Legal
`Questions Warranting a Stay .......................................................................... 3
`The Balance of Hardships Tips Heavily Against a Stay ............................. 6
`1.
`Ring Will Not Experience Irreparable Harm Absent a Stay .......... 6
`2.
`A Stay Would Prejudice Non-Purchaser Plaintiffs .......................... 9
`3.
`The Public Interest Does Not Favor a Stay. .................................. 10
`III. RING FAILS TO DEMONSTRATE THAT A STAY PENDING THE
`RESOLUTION OF THE PURCHASER PLAINTIFFS’ ARBITRATIONS IS
`WARRANTED ......................................................................................................... 11
`A.
`Legal Standard ................................................................................................ 12
`B.
`Resolution of Purchaser Plaintiffs’ Claims Will Not Determine the
`Adjudication of Non-Purchaser Plaintiffs’ Claims .................................... 12
`The Possibility of Inconsistent Rulings Does Not Favor a Stay ............. 14
`A Stay Will Delay Resolution of the Case and Impede
`Judicial Economy........................................................................................... 15
`IV. CONCLUSION ........................................................................................................ 16
`
`
`
`C.
`
`C.
`D.
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`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
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`TABLE OF AUTHORITIES
`
`Cases
`B.F. v. Amazon.com Inc.,
`No. 19-CV-910-RAJ, 2020 WL 3548010 (W.D. Wash. May 15, 2020) ....................... 4
`Bain v. Film Indep., Inc.,
`No. CV 18-4126 PA (JEMX), 2018 WL 6930770 (C.D. Cal. Oct. 11, 2018) ........... 14
`Berg v. Traylor,
`56 Cal. Rptr. 3d 140 (Cal. Ct. App. 2007) ........................................................................ 5
`Blair v. Rent-A-Ctr., Inc.,
`928 F.3d 819(9th Cir. 2019) ............................................................................................ 16
`Bradberry v. T-Mobile USA, Inc.,
`No. C 06-6567 CW, 2007 WL 1241936 (N.D. Cal. Aug. 2, 2007) ............................... 7
`Britton v. Co-op Banking Grp.,
`916 F.2d 1405, (9th Cir. 1990) .......................................................................................... 2
`Brown v. Comcast Corp.,
`No. EDCV1600264ABSPX, 2016 WL 9109112 (C.D. Cal. Aug. 12, 2016) ............... 5
`Cesca Therapeutics Inc. v. SynGen Inc.,
`No. 2:14-CV-2085-TLN-KJN, 2017 WL 1174062 (E.D. Cal. Mar. 30, 2017) ... 3, 4, 7
`Chan v. Charter Communications Holding Co.,
`No. EDCV 15-886-JGB (KKx), 2015 WL 12655701 (C.D. Cal. Aug. 6, 2015) ......... 4
`CMAX, Inc. v. Hall,
`300 F.2d 265 (9th Cir.1962) ............................................................................................ 12
`Comer v. Micor, Inc.,
`436 F.3d 1098 (9th Cir. 2006) ........................................................................................... 6
`Congdon v. Uber Techs., Inc.,
`226 F. Supp. 3d 983 (N.D. Cal. 2016) ............................................................................ 13
`Cty. of Contra Costa v. Kaiser Found. Health Plan, Inc.,
`54 Cal. Rptr. 2d 628 (Cal. Ct. App. 1996), as modified (Aug. 1, 1996) ......................... 11
`Dekker v. Vivint Solar, Inc.,
`No. C 19-07918 WHA, 2020 WL 2322916 (N.D. Cal. May 11, 2020) ........................ 3
`DKS Inc. v. Corporate Business Solutions, Inc.,
`No. 2:15-cv-00132-MCE-DAD, 2015 WL 6951281 (E.D. Cal. Nov. 10, 2015) ........ 3
`Doyle v. Giuliucci,
`401 P.2d 1 (Cal. 1965) ........................................................................................................ 5
`Fernandez v. Bridgecrest Credit Co., LLC,
`No. EDCV 19-877-MWF-SHK, 2020 WL 7711837 (C.D. Cal. May 4, 2020) ........... 3
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`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
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`Ferrari v. Mercedes Benz USA, LLC,
`No. 17-CV-00018-YGR, 2018 WL 3399320 (N.D. Cal. Jan. 18, 2018) ............... 14, 15
`Fields v. Amazon,
`No. 19-CV-910-RAJ, 2020 WL 3542653 (W.D. Wash. June 30, 2020) ....................... 5
`Gillette v. Uber Techs., Inc.,
`No. 14-cv-5241-EMC, 2015 WL 4481706 (N.D. Cal. July 22, 2015) .......................... 3
`Guifu Li v. A Perfect Day Franchise, Inc.,
`No. 5:10-CV-01189-LHK, 2011 WL 2293221 (N.D. Cal. June 8, 2011) ............ 3, 7, 9
`Jimenez v. Menzies Aviation, Inc.,
`No. 15-cv-02392-WHO, 2015 WL 5591722 (N.D. Cal. Sept. 23, 2015) ............... 3, 10
`Landis v. North American Co.,
`299 U.S. 248 (1936) .......................................................................................................... 12
`Lee v. Postmates Inc.,
`No. 18-CV-03421-JCS, 2018 WL 4961802 (N.D. Cal. Oct. 15, 2018) ...................... 14
`Leiva–Perez v. Holder,
`640 F.3d 962 (9th Cir. 2011) ................................................................................. 2, 6, 7, 9
`Leyva v. Certified Grocers of Cal., Ltd.,
`593 F.2d 857 (9th Cir. 1979) ............................................................................... 12, 15, 16
`McGill v. Citibank, N.A.,
`216 Cal. Rptr. 3d 627 (Cal. Ct. App. 2017) .............................................................. 10, 15
`McLellan v. Fitbit, Inc.,
`No. 3:16-cv-00036, 2017 WL 4551484 (N.D. Cal. Oct. 11, 2017) ....................... 14, 15
`Mohamed v. Uber Techs.,
`115 F. Supp. 3d 1024 (N.D. Cal. 2015) ............................................................................ 7
`Morse v. Servicemaster Global Holdings, Inc.,
`No. C10–628–SI, 2013 WL 123610 (N.D. Cal. Jan. 8, 2013) ............................... 2, 3, 7
`Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp.,
`460 U.S. 1 (1983) .............................................................................................................. 15
`Mundi v. Union Sec. Life Ins. Co.,
`555 F.3d 1042 (9th Cir. 2009) ........................................................................................... 5
`Munro v. Univ. of S. California,
`No. CV166191VAPCFEX, 2017 WL 5592904 (C.D. Cal. July 7, 2017) ............. 3, 8, 9
`Nken v. Holder,
`556 U.S. 418 (2009) ............................................................................................................ 2
`Norcia v. Samsung Telecomms. Am.,
`No. 14-cv-00582-JD, 2015 WL 4967247 (N.D. Cal. Aug. 20, 2015) ....................... 3, 9
`
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`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
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`Pang v. Samsung Elecs. Am., Inc.,
`371 F. Supp. 3d 633 (N.D. Cal. 2019) ............................................................................ 14
`R&L Ltd. Invs. Inc. v. Cabot Inv. Props., LLC,
`No. CV 09-1575-PHX-MHM, 2010 WL 3789401 (D. Ariz. Sep. 21, 2010) ......... 7, 10
`Shultz v. TTAC Publ’g, LLC,
`No. 20-CV-04375-HSG, 2021 WL 1845532 (N.D. Cal. Mar. 8, 2021) ....................... 2
`Sunlight Prod. Techs. v. MPOWERD,
`No. CV-15-126-MWF (JEM), 2015 WL 12655479 (C.D. Cal. Sept. 17, 2015) ........ 14
`Tice v. Amazon.com, Inc.,
`EDCV 19-1311-SVW (KKx), 2020 WL 1625782 (C.D. Cal. Mar. 25, 2020),
`rev’d and remanded on other grounds, 845 F. App’x 535 (9th Cir. 2021) ......................... 4, 5
`Trompeter v. Ally Fin., Inc.,
`914 F. Supp. 2d 1067 (N.D. Cal. 2012) .................................................................... 10, 16
`Vasquez v. Libre by Nexus, Inc.,
`No. 17-CV-00755-CW, 2018 WL 9868570 (N.D. Cal. Nov. 20, 2018) ............... 10, 11
`Volkswagen Grp. of Am., Inc. v. Saul Chevrolet, Inc.,
`No. 5:15-cv00505-ODW, 2015 WL 5680317 (C.D. Cal. Sept. 25, 2015) ................ 3, 4
`Walmer v. United States DOD,
`52 F.3d 851, 854 (10th Cir. 1995) ..................................................................................... 3
`Youssefzadeh v. Glob.-IP Cayman,
`No. 218CV02522JLSJCG, 2018 WL 6118436 (C.D. Cal. July 30, 2018) ................... 14
`Statutes
`Cal. Civ. Code § 3513 ........................................................................................................... 16
`Other Authorities
`JAMS Rule 13 .......................................................................................................................... 8
`JAMS Rule 17 .......................................................................................................................... 8
`
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`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
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`I.
`
`INTRODUCTION
`In December 2019, hackers took advantage of the deficient security protocols and
`privacy protection in the home security devices sold by Defendant Ring LLC (“Ring”) to
`gain unauthorized access to Plaintiffs’ Ring devices. Hackers virtually invaded Plaintiffs’
`homes and shouted profanities, obscenities, and death threats at them. Other Plaintiffs
`suffered the loss of their personal identifying information (“PII”) without their consent or
`authorization. Plaintiffs promptly filed these putative class actions against Ring. After
`consolidation and appointment of interim co-lead counsel, Ring moved to compel arbitration
`and for a stay of discovery. The Court denied the stay, but the Plaintiffs agreed to hold off
`on serving discovery until after the hearing on the motion to compel in exchange for Ring
`agreeing to cooperate with them to finalize a protective order and ESI protocol. Declaration
`of Hassan Zavareei ¶ 5. Now that the Court has ruled on the arbitration motion, Dkt. No.
`113 (“Order”), and discovery has finally begun—with Ring providing woefully inadequate
`responses to Plaintiffs’ first set of discovery requests—Ring is once again moving for a stay.
`Motion to Stay Proceedings (“Mot.”), Dkt. No. 120.
`Ring proposes two bases to stay the proceedings. Because Ring fails to meet its burden
`for either request for a stay, this Court should deny Ring’s Motion.
`First, Ring requests that the Court stay the proceedings pending resolution of its
`appeal of the Court’s Order. But Ring fails to meet the Ninth Circuit’s four-factor test to
`show that it is entitled to such a stay. Not only does Ring fail to show that it has a likelihood
`of success on the merits, but the balance of harms weighs heavily against a stay. Ring’s
`argument that it will incur discovery and motion expenses falls far short of the irreparable
`harm needed to justify even further delay of Non-Purchaser Plaintiffs’ ability conduct
`discovery, which risks compromising the quality of evidence for them and for the putative
`class.
`
`Second, Ring requests that the Court stay the proceedings pending the resolution of
`Purchaser Plaintiffs’ claims in arbitration. Because the claims of Non-Purchaser Plaintiffs
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`and the class do not depend on the resolution of the Purchaser Plaintiffs’ claims, such a stay
`would do nothing but create delay without preserving judicial economy. As the balance of
`interests weighs against such a stay, Plaintiffs respectfully request the Motion be denied.
`II. RING FAILED TO DEMONSTRATE THAT A STAY PENDING APPEAL
`IS WARRANTED
`A.
`Legal Standard
`The party requesting a stay pending appeal “bears the burden of showing that the
`case’s circumstances justify favorable exercise of [the Court’s] discretion.” Morse v.
`Servicemaster Global Holdings, Inc., No. C10–628–SI, 2013 WL 123610, at *1 (N.D. Cal. Jan. 8,
`2013) (citing Nken v. Holder, 556 U.S. 418, 433-34 (2009)). In determining whether to issue a
`stay, courts consider four factors: (1) whether the moving party has made a strong showing
`that it is likely to succeed on the merits; (2) whether the moving party will be irreparably
`injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties
`interested in the proceeding; and (4) whether the public interest favors a stay. Leiva–Perez v.
`Holder, 640 F.3d 962, 964 (9th Cir. 2011); Nken, 556 U.S. at 434. In weighing these factors,
`courts apply a “sliding scale,” such that “a stronger showing of one [factor] may offset a
`weaker showing of another.” Leiva–Perez, 640 F.3d at 964. To that end, a moving party who
`cannot satisfy a strong likelihood of success under the first factor, must at minimum show
`that its appeal presents “a substantial case on the merits” and must demonstrate “that the
`balance of hardships under the second and third factors tilts sharply in its favor.” Morse, 2013
`WL 123610, at *2 (citing Leiva–Perez, 640 F.3d at 966, 970) (emphasis in original).
`Contrary to Ring’s assertion, stays are not “routinely” granted under this standard.
`Mot. at 4. Rather, a routine grant of a stay “would allow a defendant to stall a trial simply by
`bringing a frivolous motion to compel arbitration.” Britton v. Co-op Banking Grp., 916 F.2d
`1405, 1412 (9th Cir. 1990). Thus, when a party fails to show a likelihood of success on the
`merits or fails to show irreparable harm, courts will deny an application for a stay. See, e.g.,
`Shultz v. TTAC Publ’g, LLC, No. 20-CV-04375-HSG, 2021 WL 1845532, at *1 (N.D. Cal.
`Mar. 8, 2021); Dekker v. Vivint Solar, Inc., No. C 19-07918 WHA, 2020 WL 2322916, at *1
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`(N.D. Cal. May 11, 2020); Fernandez v. Bridgecrest Credit Co., LLC, No. EDCV 19-877-MWF-
`SHK, 2020 WL 7711837, at *1 (C.D. Cal. May 4, 2020); Munro v. Univ. of S. California, No.
`CV166191VAPCFEX, 2017 WL 5592904, at *5 (C.D. Cal. July 7, 2017); Cesca Therapeutics Inc.
`v. SynGen Inc., No. 2:14-CV-2085-TLN-KJN, 2017 WL 1174062, at *4 (E.D. Cal. Mar. 30,
`2017); DKS Inc. v. Corporate Business Solutions, Inc., No. 2:15-cv-00132-MCE-DAD, 2015 WL
`6951281, at *1-2 (E.D. Cal. Nov. 10, 2015); Volkswagen Grp. of Am., Inc. v. Saul Chevrolet, Inc.,
`No. 5:15-cv00505-ODW, 2015 WL 5680317, at *4 (C.D. Cal. Sept. 25, 2015); Jimenez v.
`Menzies Aviation, Inc., No. 15-cv-02392-WHO, 2015 WL 5591722, at *2-3 (N.D. Cal. Sept.
`23, 2015); Norcia v. Samsung Telecomms. Am., No. 14-cv-00582-JD, 2015 WL 4967247, at *2-3
`(N.D. Cal. Aug. 20, 2015); Morse, 2013 WL 123610, at *3; Guifu Li v. A Perfect Day Franchise,
`Inc., No. 5:10-CV-01189-LHK, 2011 WL 2293221, at *3-5 (N.D. Cal. June 8, 2011); see also
`Gillette v. Uber Techs., Inc., No. 14-cv-5241-EMC, 2015 WL 4481706, at *2 n.2 (N.D. Cal. July
`22, 2015) (“[A]ccording to this Court’s unofficial tally of decisions . . . California district
`courts have denied stays pending appeal of an order denying a motion to compel arbitration
`twelve times, while California district courts have granted such motions eight times.”).
`B. Ring Has Not Demonstrated That Its Appeal Presents Serious Legal
`Questions Warranting a Stay
`Ring does not even attempt to make a showing that it has a strong likelihood of success
`on the merits. Ring argues instead that its appeal raises “serious legal questions.” Mot. at 5-
`10. However, the fact that a defendant has requested “a review of the district court’s decision
`does not automatically mean that [it has] raised a ‘serious legal question’ on appeal.” Guifu
`Li, 2011 WL 2293221, at *3. “For a legal question to be ‘serious,’ it must be a ‘question going
`to the merits so serious, substantial, difficult and doubtful, as to make the issues ripe for
`litigation and deserving of more deliberate investigation.’” Id. (quoting Walmer v. United States
`DOD, 52 F.3d 851, 854 (10th Cir. 1995)). In this Circuit, “serious legal questions often
`concern constitutionality.” Id. at *2. Even if an issue is one of first impression, this is not, by
`itself, sufficient to show an appeal is a “substantial case which ‘raises serious legal questions,
`or has a reasonable probability or fair prospect of success.’” Volkswagen Grp. of Am., Inc., 2015
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`WL 5680317, at *4 (“It is difficult to conceive of an appeal presenting a ‘substantial question’
`where, for example, the argument is novel but completely frivolous.”). Further, courts have
`found that failing to raise new substantive arguments that were not raised in the motion to
`compel “weighs against likelihood of success on the merits.” Cesca Therapeutics Inc., 2017 WL
`1174062, at *3.
`Here, Ring has raised no “serious, substantial, difficult and doubtful” issues, and
`certainly no constitutional issues. Instead, Ring merely recycles the already-rejected
`arguments advanced in its original motion to compel arbitration.
`First, Ring argues that there is a serious legal question regarding whether the Non-
`Purchasers Plaintiffs’ preexisting relationship with Purchaser Plaintiffs makes it equitable to
`enforce Ring’s Terms of Service (“the Terms”) against them. Mot. 5-6. Ring cites Chan v.
`Charter Communications Holding Co., No. EDCV 15-886-JGB (KKx), 2015 WL 12655701, at *5
`(C.D. Cal. Aug. 6, 2015), and Tice v. Amazon.com, Inc., EDCV 19-1311-SVW (KKx), 2020 WL
`1625782, at *3 (C.D. Cal. Mar. 25, 2020), rev’d and remanded on other grounds, 845 F. App’x 535
`(9th Cir. 2021), for the proposition that there is a split in authority over this issue. But Ring
`overstates the extent of any split. Because the nonsignatory children in Chan were not parties
`to the case, it was “irrelevant whether they agreed to arbitrate.” 2015 WL 12655701, at *5.
`And Tice, involved a spouse who voluntarily utilized the product, 2020 WL 1625782, at *3,
`not a dependent that was passively exposed to it. In addition, as this Court explained, “both
`courts relied upon California authorities such as County of Contra Costa without addressing the
`distinction between contracts for medical services and adhesion contracts for consumer
`goods.” Order at 15.
` Ring notes that under similar factual circumstances to this case, a Western District of
`Washington court found that a conflict between that court’s decision denying a motion to
`compel arbitration and Tice raised a serious question of law that merited granting a stay. B.F.
`v. Amazon.com Inc., No. 19-CV-910-RAJ, 2020 WL 3548010, at *3 (W.D. Wash. May 15, 2020),
`report and recommendation adopted sub nom. B.F. by & through Fields v. Amazon, No. 19-CV-910-
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`RAJ, 2020 WL 3542653 (W.D. Wash. June 30, 2020). However, as that court noted, and
`unlike the Order at issue here, the serious legal question remained in part because the court’s
`opinion had not addressed the potential conflict with Tice. 2020 WL 3542653, at *3.
`Moreover, the Ninth Circuit has since affirmed the denial of the motion to compel arbitration
`in B.F. v. Amazon.com, holding that under Washington law, a close-relationship theory of
`estoppel—absent knowing exploitation of the contract by the nonsignatory—may be used
`only by nonsignatories to a contract to bind signatories, not the reverse. B.F. v. Amazon.com
`Inc, No. 20-35359, 2021 WL 1593003, at *2 (9th Cir. Apr. 23, 2021) (distinguishing Mundi v.
`Union Sec. Life Ins. Co., 555 F.3d 1042, 1046 (9th Cir. 2009)).
`Second, Ring argues that whether Doyle v. Giuliucci, 401 P.2d 1 (Cal. 1965), which
`involved parental rights to contract on behalf of their children for medical or necessary
`services, applies to consumer contracts, is an issue of first impression for the Ninth Circuit
`and California courts, and is therefore necessarily also a serious legal question that weighs in
`favor of granting a stay. But Doyle itself makes clear that the power to enter into a contract
`for medical care that binds a child is “implicit in a parent’s right and duty to provide for the
`care of his child.” 401 P.2d at 3. “Since minors can usually disaffirm their own contracts to
`pay for medical services, it is unlikely that medical groups would contract directly with them”
`absent an ability of parents to contract on their children’s behalf. Id. There is no similarly
`compelling reason to allow parents to contract for services that are not medical or not
`necessary. And other California courts have followed Doyle’s reasoning to allow minors to
`disaffirm contracts entered into on their behalf that do “not implicate a parent’s fundamental
`duty to provide for the care and health of a child.” Berg v. Traylor, 56 Cal. Rptr. 3d 140, 147
`(Cal. Ct. App. 2007); see also Brown v. Comcast Corp., No. EDCV1600264ABSPX, 2016 WL
`9109112, at *4 (C.D. Cal. Aug. 12, 2016) (denying motion to compel arbitration because “the
`recognized preexisting relationships in County of Contra Costa . . . are all ‘grounded in the
`authority of the signatory to contract for medical services on behalf of the nonsignatory’”
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`PLAINTIFFS’ OPPOSITION TO MOTION TO STAY
`No. 2:19-cv-10899-MWF (RAOx)
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`(citation omitted)). Contrary to Ring’s suggestion, there is nothing novel about the Court’s
`decision here.
`Ring’s remaining arguments—that Non-Purchaser Plaintiffs “knowingly exploited”
`the Terms such that equitable estoppel is available, and that Non-Purchaser Plaintiffs are
`included “Authorized User[s]” under the Terms—have an even lower prospect of success
`on appeal. With respect to the first argument, an individual only “knowingly exploit[s]” the
`terms of an agreement when he or she brings claims that arise out of that agreement. Comer
`v. Micor, Inc., 436 F.3d 1098, 1102 (9th Cir. 2006) (holding that the non-signatory, who neither
`sought to enforce the terms of the management agreement nor sued under its provisions, did
`not knowingly exploit that agreement and could not be estopped from avoiding arbitration);
`cf. B.F., 2021 WL 1593003, at *2 (holding, under Washington law, that because “[p]laintiffs
`are not asserting any right or looking to enforce any duty created by the contracts between
`their parents and defendants” equitable estoppel did not apply). Non-Purchaser Plaintiffs do
`not bring contract claims. Their claims arise out of Ring’s failure to prevent the hacking of
`their devices, a breach of an independent duty that Ring owed to them irrespective of any
`contract with their parents or guardians. See Opp. to Mot. to Compel (Dkt. No. 89) at 10.
`With respect to the argument that Non-Purchaser Plaintiffs are “Authorized User[s],” Ring
`cannot seriously dispute that the only reasonable interpretation of “Authorized User” is
`someone with meaningful access to the account, and not “anyone who is knowingly or
`unknowingly surveilled by a Ring device.” Order at 15.
`As Ring has failed to demonstrate that its appeal raises a substantial case on the merits,
`much less that it is likely to succeed on appeal, this factor weighs against granting a stay.
`C. The Balance of Hardships Tips Heavily Against a Stay
`1.
`Ring Will Not Experience Irreparable Harm Absent a Stay
`The “burden with regard to irreparable harm is higher than it is on the likelihood of
`success prong, as [Ring] must show that an irreparable injury is the more probable or likely
`outcome.” Leiva-Perez, 640 F.3d at 968. When the moving party has not met its burden, “then
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`a stay may not issue, regardless of the petitioner’s proof regarding the other stay factors.” Id.
`at 965. Because Ring does not argue that it has a strong likelihood of success—and instead
`relies on the alternative serious question framework—Ring may only succeed when this
`prong sharply tips in its favor. Id. at 964.
`Further, Ring must show “there is a reason specific to [its] case, as opposed to a reason
`that would apply equally well to all” those seeking a stay pending review of a denial to compel
`arbitration. Id. at 969; Cesca Therapeutics Inc., 2017 WL 1174062, at *4. Notably, financial
`burden from litigation conduct is not an irreparable harm because “[i]f financial burden was
`an irreparable harm, then every interlocutory appeal of a denial to compel arbitration would
`automatically be stayed, a finding which is contrary to Ninth Circuit precedent.” Cesca
`Therapeutics Inc., 2017 WL 1174062, at *4; see also, e.g., Mohamed v. Uber Techs., 115 F. Supp. 3d
`1024, 1032–33 (N.D. Cal. 2015) (“[N]early all courts ‘have concluded that incurring litigation
`expenses does not amount to an irreparable harm.’” (quoting Guifu Li, 2011 WL 2293221, at
`*4 )); Morse, 2013 WL 123610, at *3 (“[T]he money and time a party must expend in that
`process, while burdensome, does not alone constitute irreparable injury”); Guifu Li, 2011 WL
`2293221, at *4 (“incurring litigation expenses does not amount to an irreparable harm”);
`R&L Ltd. Invs. Inc. v. Cabot Inv. Props., LLC, No. CV 09-1575-PHX-MHM, 2010 WL
`3789401, at *2 (D. Ariz. Sep. 21, 2010) (“Here, it appears the only litigation costs that will be
`incurred while the parties await appeal are discovery costs, which do not constitute
`irreparable injury.”); Bradberry v. T-Mobile USA, Inc., No. C 06-6567 CW, 2007 WL 1241936,
`at *4 (N.D. Cal. Aug. 2, 2007) (“The cost of some pretrial litigation does not constitute an
`irreparable harm to Defendant.”).
`Here, Ring argues that it will be irreparably harmed absent a stay because it will incur
`the expense of engaging in class discovery and motion practice. Mot. at 10-12. But Ring’s
`arguments miss the mark. Ring will incur many of the same expenses regardless of whether
`the claims are adjudicated before the district court or in arbitration. Although Ring is correct
`that the JAMS Arbitration rules provide for less formal discovery than do the Federal Rules
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`of Civil Procedure, Mot. at 11-12, they do require parties to exchange “all non-privileged
`documents and information (including electronically stored information (‘ESI’)) relevant to
`the dispute or claim,” provide for expert testimony, allow third-party discovery, and provide
`for the examination of witnesses. See JAMS Rules 13 and 17. Ring has not shown that the
`financial burden would be significantly less in arbitration. As decisions in this district have
`noted in similar circumstances, “the burden created by the time and expense Defendants will
`spend in this Court’s discovery process is significantly mitigated by the reality that
`Defendants’ arbitration discovery process would also result in a similar amount of time and
`expense.” Munro, 2017 WL 5592904, at *4.
`Moreover, if Ring eventually prevails on its appeal—and there is no indication it will—
`and the case proceeds to arbitration, the parties will be better prepared to address the merits
`of their dispute because of the discovery they conducted while the appeal was pending. Stated
`otherwise, even if Ring “eventually prevailed on its appeal, the discovery costs of the
`arbitration process will be reduced by any discovery completed in this Court.” Munro, 2017
`WL 5592904, at *4. Thus, no matter the outcome of the appeal, continued proceedings in
`this Court will produce a more expeditious outcome for all parties.
`That Non-Purchaser Plaintiffs bring their claims on behalf of a class does not alter the
`analysis in this case. First, Ring provides no reason to think that litigating the case on a class-
`wide basis would be more burdensome. Many of the central facts affecting liability are
`common to all plaintiffs. For example, whether Ring’s security systems are defectively
`designed, First Amended Complaint ¶¶ 3-8, is a common question of fact that applies equally
`to all plaintiffs and is central to determining Ring’s liability. Resolving this question will
`involve expert examination of the Ring’s hardware and software products, as well as its
`security practices, such that adjudicating these claims together, rather than over multiple
`cases, would actually reduce the litigation burden. Further, although class discovery involves
`examination of questions distinct from the merits (e.g., whether the class representatives are
`typical, whether the class representatives can adequately represent the class, whether the class
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`is sufficiently numerous), discovery into these issues is not so burdensome as to undermine
`the general rule that i