Case 3:21-cv-03577-VC Document 79 Filed 07/26/22 Page 1 of 4
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`MATTHEW AMANS, et al.,
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`Plaintiffs,
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`v.
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`TESLA, INC.,
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`Defendant.
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`Case No. 21-cv-03577-VC
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`ORDER RE MOTION TO DISMISS
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`Re: Dkt. No. 63
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`The motion to dismiss is denied with respect to the breach of contract claim for specific
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`performance and damages but granted as to the breach of contract claim for restitution. The
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`motion is additionally granted as to the claims under the Unfair Competition Law, Consumer
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`Legal Remedies Act, California Business & Professions Code § 7160, and Truth in Lending Act.
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`1. Mootness. Tesla argues Malek’s claims are moot because it already installed his roof at
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`the original contract price. Yet Malek plausibly alleges that he was charged an additional
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`$10,500 (at least). The parties offer competing explanations for this charge. Tesla argues that the
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`$10,500 was for a Powerwall not included in the original contract. Malek counters that Tesla
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`charged for the Powerwall only after purporting to return to his original price. Given this dispute,
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`there is the possibility of effective relief: a refund of $10,500. See Forest Guardians v. Johanns,
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`450 F.3d 455, 461 (9th Cir. 2006). As such, Malek’s claims are not moot.
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`Tesla similarly argues that the claims by Amans are moot because it has offered to install
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`his roof at the original price. Voluntary cessation of a defendant’s challenged conduct does not
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`moot a case unless it is “absolutely clear the allegedly wrongful behavior could not reasonably
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`be expected to recur.” Friends of the Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc.,
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`Case 3:21-cv-03577-VC Document 79 Filed 07/26/22 Page 2 of 4
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`528 U.S. 167, 190 (2000). Tesla cannot bear that “heavy burden” here. Id. at 189. In particular,
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`Tesla stands by its purported contractual right to increase the price of the roof, and Malek has
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`plausibly alleged he was overcharged despite Tesla’s promises.
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`2. Jurisdiction to Grant Equitable Relief. To remedy the alleged breach of contract, the
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`plaintiffs seek specific performance and/or restitution and actual damages.1 Tesla argues that the
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`court lacks jurisdiction to grant equitable relief (the specific performance and restitution).
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`In Sonner v. Premier Nutrition Corp., the Ninth Circuit held that a plaintiff “must
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`establish that she lacks an adequate remedy at law before securing” equitable relief. 971 F.3d
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`834, 844 (9th Cir. 2020). “Courts in the Ninth Circuit are divided on how exacting of a standard
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`Sonner imposes on plaintiffs who plead claims for equitable and legal remedies at the pleading
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`stage.” Jeong v. Nexo Financial LLC, No. 21-CV-02392-BLF, 2022 WL 174236, at *27 (N.D.
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`Cal. Jan. 19, 2022). At a minimum, Sonner requires plaintiffs to plead that they lack an adequate
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`remedy at law, but some courts have held plaintiffs must offer “specific facts” showing as much.
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`Compare Johnson v. Trumpet Behavior Health, LLC, No. 3:21-CV-03221-WHO, 2022 WL
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`74163, at *3 (N.D. Cal. Jan. 7, 2022), with Nacarino v. Chobani, LLC, No. 20-CV-07437-EMC,
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`2021 WL 3487117, at *12 (N.D. Cal. Aug. 9, 2021). This Court has previously required that
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`plaintiffs offer some explanation as to why their legal remedies are inadequate. See Cepelak v.
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`HP Inc., No. 20-CV-02450-VC, 2021 WL 5298022, at *3 (N.D. Cal. Nov. 15, 2021).
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`Amans has adequately explained that “no comparable products to the Solar Roof
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`currently exist,” and so damages would not remedy his injury. While he also sought damages
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`under the CLRA and CPB § 7160, that does not suggest a legal remedy would be adequate.
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`Those damages are intended to remedy distinct injuries, and nothing in Sonner prevents plaintiffs
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`from bringing “claims in the alternative under different legal theories.” See Cepelak, 2021 WL
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`5298022, at *2.
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`1 Because the remaining claims in the complaint are dismissed, the Court does not address its
`jurisdiction to grant equitable relief for any other claims.
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`2
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`Case 3:21-cv-03577-VC Document 79 Filed 07/26/22 Page 3 of 4
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`Malek, in contrast, has not explained why restitution, and not damages, are required to
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`remedy his injury. His claim for restitution is therefore dismissed. Because he may be able to
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`articulate an alternative legal theory justifying restitution, his claim is dismissed with leave to
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`amend.
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`3. Breach of Contract. Tesla argues there is no breach of contract because the contract
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`authorizes its price increase. First, Tesla suggests the contract authorizes a price increase any
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`time the “final cost” is “greater than anticipated.” Read in context, however, the contract seems
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`to authorize a much more limited increase. The full provision reads:
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`Standard installation includes the cost of minor repairs commonly needed to install Solar
`Roof. These repairs may include simple electric upgrades and roof preparation. Tesla will
`determine the final cost of these repairs prior to installation. If the final cost or scope of
`work needed for your installation are greater than anticipated, Tesla will provide you with
`an amendment pursuant to this Solar Roof Purchase & Home Improvement Agreement.
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`The term “final cost” appears to refer to the final cost of repairs—not the final cost of the roofing
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`agreement—and so it does not appear to authorize the across-the-board increase in this case.
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`Tesla next points to the provision stating: “If Tesla encounters unforeseen conditions at
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`the installation location or causes a change to the solar portion of your Solar Roof, you will
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`receive an updated Price Sheet to accept or reject.” This seems to authorize a limited price
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`increase based on “unforeseen conditions” or changes to the “solar portion” of the roof. Tesla has
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`not justified the price increases here on those terms.
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`At a minimum, these two provisions are ambiguous, and so the breach of contract claim
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`should not be dismissed. See Hayter Trucking, Inc. v. Shell W. E & P, Inc., 18 Cal. App. 4th 1,
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`18 (1993).
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`4. Fraud Claims. The plaintiffs’ claims under the CLRA, CPB § 7160, and the
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`“fraudulent” prong of the UCL rely on the same theory: that Tesla offered consumers an
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`artificially low price with plans to increase it later. The plaintiffs also suggest Tesla intentionally
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`misrepresented the time it would take to install the roofs. These fraud claims are subject to the
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`3
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`Case 3:21-cv-03577-VC Document 79 Filed 07/26/22 Page 4 of 4
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`heightened pleading requirements of Rule 9(b). See Kearns v. Ford Motor Co., 567 F.3d 1120,
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`1125 (9th Cir. 2009) (UCL and CLRA); Sowa v. Abberley, 2012 WL 12887754, at *3 (C.D. Cal.
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`Nov. 20, 2012) (CBP § 7160). Although Rule 9(b) allows the plaintiffs to plead Tesla’s intent
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`generally, the complaint still does not provide a sufficient factual basis for the court to infer that
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`Tesla intended to raise its prices or mislead consumers on the timing of installation at the time of
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`the original agreements. See Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). The claims are
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`therefore dismissed.
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`The plaintiffs’ claim under the “unfair” prong of the UCL relied on this same theory of
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`fraud, and so it is dismissed as well. See In re Intel Corp. CPU Marketing, Sales Practices &
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`Products Liability Litigation, No. 3:18-MD-2828-SI, 2020 WL 1495304, at *23 (D. Or. Mar. 27,
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`2020). The plaintiffs’ claim under the “unlawful” prong of the UCL depended on violations of
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`the CLRA and CPB, and so it is also dismissed.
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`As discussed at the hearing, the UCL, CLRA, and CPB § 7160 claims are dismissed
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`without prejudice to seeking leave to filing an amended complaint if discovery on the surviving
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`claims gives the plaintiffs a good-faith basis for including more specific allegations regarding
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`fraud.
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`5. TILA Claim. Tesla argues that Malek does not have standing for his TILA claim
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`because he failed to allege a concrete injury beyond the statutory violation. See, e.g., TransUnion
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`LLC v. Ramirez, 141 S. Ct. 2190, 2205 (2021). Malek did not address Tesla’s arguments in his
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`opposition, and so the TILA is dismissed with prejudice. Homsy v. Bank of America, N.A., No. C
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`13-01608 LB, 2013 WL 2422781, at *5 (N.D. Cal. June 3, 2013).
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`IT IS SO ORDERED.
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`Dated: July 26, 2022
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`______________________________________
`VINCE CHHABRIA
`United States District Judge
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