`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 1 of 21
`
`HUESTON HENNIGAN LLP
`John C. Hueston, State Bar No. 164921
`jhueston@hueston.com
`Douglas J. Dixon, State Bar No. 275389
`ddixon@hueston.com
`620 Newport Center Drive, Suite 1300
`Newport Beach, CA 92660
`Telephone:
`(949) 229-8640
`
`HUESTON HENNIGAN LLP
`Joseph A. Reiter, State Bar No. 294976
`jreiter@hueston.com
`Christine Woodin, State Bar No. 295023
`cwoodin@hueston.com
`Michael K. Acquah, State Bar No. 313955
`macquah@hueston.com
`William M. Larsen, State Bar No. 314091
`wlarsen@hueston.com
`Julia L. Haines, State Bar No. 321607
`jhaines@hueston.com
`523 West 6th Street, Suite 400
`Los Angeles, CA 90014
`Telephone:
`(213) 788-4340
`
`Attorneys for Plaintiffs Match Group, LLC;
`Humor Rainbow, Inc.; PlentyofFish Media ULC;
`and People Media, Inc.
`
`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
`
`Case No. 3:21-md-02981-JD
`
`MATCH PLAINTIFFS’ MOTION TO
`DISMISS GOOGLE DEFENDANTS’
`COUNTERCLAIMS
`
`Date:
`
`September 8, 2022
`Time:
`
`10:00 a.m.
`Judge:
`Hon. James Donato
`Courtroom:
`11, 19th Floor, 450 Golden Gate
`Ave, San Francisco, CA 94104
`
`IN RE GOOGLE PLAY STORE
`ANTITRUST LITIGATION
`
`
`THIS DOCUMENT RELATES TO:
`
`
`Match Group, LLC, et al. v. Google LLC,
`et al., Case No. 3:22-cv-02746-JD
`
`
`
`
`
`
`
`
`
`6228763
`
`
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`

`

`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 2 of 21
`
`
`
`TO ALL PARTIES AND THEIR COUNSEL OF RECORD:
`PLEASE TAKE NOTICE that on September 8, 2022, at 10:00 a.m., in Courtroom 11 of
`the above-entitled Court, located on the 19th floor of 450 Golden Gate Avenue, San Francisco,
`California 94102, before the Honorable James Donato, Plaintiffs and Counterclaim-Defendants
`Match Group, LLC; Humor Rainbow, Inc.; PlentyofFish Media ULC; and People Media, Inc.
`(collectively, Match Plaintiffs)1 will and hereby do move to dismiss Google’s counterclaims. See
`Dkt. 283.
`The grounds for Match Plaintiffs’ motion are set forth more fully in the attached
`memorandum. But in brief, (1) Google’s breach of contract claim fails because in each of the four
`relevant time periods, Match Plaintiffs were not in breach or Google otherwise waived performance;
`(2) Google’s false promise and breach of the implied covenant claims rest on purported “promises”
`that promised nothing, and Google fails to plead any other purported false statements with
`specificity; and (3) Google’s quasi-contract claim fails because California law prohibits such claims
`when the parties’ relationship is governed by an express contract.
`This Motion is based on this Notice of Motion, Memorandum of Points and Authorities, the
`Declaration of William Larsen, the accompanying Request for Judicial Notice, all pleadings and
`papers filed in this action, and such other matters as may be presented to the Court at the time of or
`before the hearing.
`
`Dated: August 1, 2022
`
`HUESTON HENNIGAN LLP
`
`By:
`
`/s/ Douglas J. Dixon
`Douglas J. Dixon
`Attorneys for Plaintiffs Match Group, LLC;
`Humor Rainbow, Inc.; PlentyofFish Media ULC;
`and People Media, Inc.
`
`
`
`
`1 For the purposes of this case, the term “Match Plaintiffs” includes only the operating entities
`named as Plaintiffs, which are part of the Match Group, Inc. portfolio of companies.
`- 1 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`6228763
`
`
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 3 of 21
`
`TABLE OF CONTENTS
`
`Page
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`
`I.
`II.
`III.
`IV.
`
`V.
`
`
`6228763
`
`INTRODUCTION ................................................................................................................. 1
`BACKGROUND ................................................................................................................... 2
`LEGAL STANDARD ........................................................................................................... 5
`ARGUMENT ......................................................................................................................... 6
`A.
`Google’s Breach of Contract Claim Fails in Four Relevant Periods ......................... 6
`1.
`Until September 28, 2020, Google’s Payments Policy
`permitted alternative payment systems for apps with certain
`kinds of digital content .................................................................................. 6
`From September 28, 2020 to September 30, 2021, Google
`allowed all developers a one-year “extension” to comply ............................. 8
`From September 30, 2021 to March 31, 2022, Google granted
`Match Plaintiffs a further extension .............................................................. 8
`From March 31, 2022 to June 1, 2022, Google publicly
`announced it would not take action to remove noncompliant
`apps ................................................................................................................ 9
`The False Promise Claim Fails Because Match Plaintiffs Promised
`Nothing ...................................................................................................................... 9
`1.
`Google identifies no clear, unambiguous promise to comply
`with the DDA, and Google’s reliance on Match Plaintiffs’
`statements was not reasonable ....................................................................... 9
`To the extent Google alleges other false promises, Google
`fails to plead them with particularity ........................................................... 13
`The Breach of Implied Covenant Claim Fails for the Same Reasons ..................... 14
`Google Is Precluded from Asserting a Quasi-Contract Claim Because
`It Does Not Allege That the DDA and Payments Policy Are
`Unenforceable .......................................................................................................... 14
`CONCLUSION.................................................................................................................... 15
`
`2.
`
`3.
`
`4.
`
`2.
`
`B.
`
`C.
`D.
`
`- i -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 4 of 21
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`
`
`Cases
`
`Aguilar v. Int'l Longshoremen's Union Loc. No. 10,
`966 F.2d 443 (9th Cir. 1992) ............................................................................................... 10
`
`Alliance Mortg. Co. v. Rothwell,
`10 Cal.4th 1226 (1995) ........................................................................................................ 12
`
`Aquilina v. Certain Underwriters at Lloyd's Syndicate #2003,
`407 F. Supp. 3d 1016 (D. Haw. 2019) ................................................................................. 14
`
`Arch Ins. Co. v. Allegiant Prof'l Bus. Servs., Inc.,
`2012 WL 1400302 (C.D. Cal. Apr. 23, 2012) ..................................................................... 13
`
`Ashcroft v. Iqbal,
`556 U.S. 662 (2009) ......................................................................................................... 5, 10
`
`Bank of the West v. Superior Ct.,
`2 Cal. 4th 1254 (1992) ........................................................................................................... 7
`
`Barrous v. BP PLC,
`2010 WL 4024774 (N.D. Cal. Oct. 13, 2010) ....................................................................... 8
`
`Bedrosian v. Tenet Healthcare Corp.,
`208 F.3d 220 (9th Cir. 2000) ................................................................................................. 7
`
`Cal. Medical Ass’n, Inc. v. Aetna US Healthcare of Cal., Inc.,
`94 Cal. App. 4th 151 (2001) ................................................................................................ 15
`
`Dooms v. Fed. Home Loan Mortg. Corp.,
`2011 WL 1232989 (E.D. Cal. Mar. 31, 2011) ....................................................................... 5
`
`DuBeck v. Cal. Physicians’ Serv.,
`234 Cal. App. 4th 1254 (2015) .............................................................................................. 8
`
`Durell v. Sharp Healthcare,
`183 Cal. App. 4th 1350 (2010) ............................................................................................ 15
`
`First Advantage Background Servs. Corp. v. Priv. Eyes, Inc.,
`2007 WL 2572191 (N.D. Cal. Sept. 5, 2007) ........................................................................ 9
`
`First Advantage Background Servs. Corp. v. Private Eyes, Inc.,
`569 F. Supp. 2d 929 (N.D. Cal. 2008) ....................................................................... 5, 10, 11
`
`Foster v. Reverse Mortg. Solutions, Inc.,
`2020 WL 4390374 (C.D. Cal. May 13, 2020) ..................................................................... 12
`
`- ii -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 5 of 21
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`TABLE OF AUTHORITIES (cont.)
`
`Page(s)
`
`Glen Holly Ent., Inc. v. Tektronix Inc.,
`343 F.3d 1000 (9th Cir. 2003) ............................................................................................. 10
`
`
`
`Granadino v. Wells Fargo Bank, N.A.,
`236 Cal. App. 4th 411 (2015) ........................................................................................ 10, 11
`
`Hills Transp. Co. v. Southwest Forest Indus., Inc.,
`266 Cal.App.2d 702 (1968) ........................................................................................... 10, 12
`
`In re CMR Mortg. Fund, LLC,
`416 B.R. 720 (Bankr. N.D. Cal. 2009) .................................................................................. 8
`
`In re Gilead Sci. Sec. Litig.,
`536 F.3d 1049 (9th Cir. 2008) ............................................................................................... 5
`
`Kearns v. Ford Motor Co.,
`567 F.3d 1120 (9th Cir. 2009) ............................................................................................. 14
`
`Klein v. Chevron USA, Inc.,
`202 Cal. App. 4th 1342 (2012) ............................................................................................ 15
`
`Kruse v. Bank of Am.,
`202 Cal. App. 3d 38 (1988) ................................................................................................. 12
`
`Mat-Van, Inc. v. Sheldon Good & Co. Auctions, LLC,
`2008 WL 346421 (S.D. Cal. Feb. 6, 2008) .......................................................................... 13
`
`Mewawalla v. Middleman, No. 21-CV-0,
`2022 WL 1304474 (N.D. Cal. May 2, 2022) ....................................................................... 13
`
`Miles v. Deutsche Bank Nat’l Trust Co.,
`236 Cal.App.4th 394 (2015) .................................................................................................. 6
`
`Mostowfi v. I2 Telecom Int'l, Inc.,
`2005 WL 8162717 (N.D. Cal. May 23, 2005) ..................................................................... 14
`
`Nguyen v. Stephens Institute,
`529 F. Supp. 3d 1047 (N.D. Cal. 2021) ............................................................................... 15
`
`Phillips v. JP Morgan Chase Bank, N.A.,
`2011 WL 13101726 (S.D. Cal. Nov. 14, 2011) ............................................................... 9, 11
`
`Sanchez v. Aurora Loan Servs., LLC,
`2014 WL 12589660 (C.D. Cal. June 10, 2014) ................................................................... 12
`
`Saroya v. Univ. of the Pacific,
`503 F. Supp. 3d 986 (N.D. Cal. 2020) ................................................................................. 15
`- iii -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`6228763
`
`
`
`

`

`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 6 of 21
`
`TABLE OF AUTHORITIES (cont.)
`
`Page(s)
`
`Sundance Image Tech., Inv. v. Inkjetmall.com, Ltd., ,
`2005 WL 8173279 (S.D. Cal. Oct. 4, 2005) ........................................................................ 10
`
`
`
`Swartz v. KPMG LLP,
`476 F.3d 756 (9th Cir. 2007) ............................................................................................... 14
`
`Tarmann v. State Farm Mut. Auto. Ins. Co.,
`2 Cal. App. 4th 153 (1991) .................................................................................................... 5
`
`UMG Recordings, Inc. v. Glob. Eagle Entm't, Inc.,
`117 F. Supp. 3d 1092 (C.D. Cal. 2015) ............................................................................... 13
`
`United States ex rel. Swoben v. United Healthcare Ins. Co.,
`848 F.3d 1161 (9th Cir. 2016) ............................................................................................... 5
`
`United States v. Ritchie,
`342 F.3d 903 (9th Cir. 2003) ....................................................................................... 5, 7, 10
`
`Vess v. Ciba-Geigy Corp. USA,
`317 F.3d 1097 (9th Cir.2003) ........................................................................................ 13, 14
`
`Wells v. Chase Home Fin., LLC,
`2010 WL 4858252 (W.D. Wash. Nov. 19, 2010) ................................................................ 11
`
`Whitesides v. E*TRADE Sec., LLC,
`2021 WL 2590156 (N.D. Cal. June 24, 2021) ....................................................................... 8
`
`Woods v. Google Inc.,
`2011 WL 3501403 (N.D. Cal. Aug. 10, 2011) ...................................................................... 8
`
`Workman-Johnson v. Kaplan Higher Educ. Corp.,
`2008 WL 11336910 (S.D. Cal. Aug. 11, 2008) ................................................................... 12
`
`Zepeda v. PayPal, Inc.,,
`777 F. Supp. 2d 1215 (N.D. Cal. 2011) ............................................................................. 7, 8
`
`Statutes
`
`Cal. Code Civ. Proc. § 337(a) ............................................................................................................ 2
`
`Rules
`
`Fed. R. Civ. P. 9(b) ........................................................................................................................ 5, 9
`
`
`
`
`6228763
`
`- iv -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 7 of 21
`
`
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`I.
`
`MEMORANDUM OF POINTS AND AUTHORITIES
`INTRODUCTION
`Google has long known that Match Plaintiffs’ dating apps2 offer in-app purchases through
`alternative payment processing systems. Google also knows that Match Plaintiffs did so in
`compliance with Google’s Developer Distribution Agreement (DDA) and incorporated Payments
`Policy. For many years, the Payments Policy expressly allowed apps selling “digital content that
`may be consumed outside of the app itself” to bypass Google’s payment system and the
`unconscionable fees that Google takes from app developers and consumers. (Larsen Decl., Ex. 1.)
`There is no question that Match Plaintiffs fell within that exception because Google’s own
`counterclaims admit as much. As Google alleges, the digital content that Match Plaintiffs sell
`through their apps are “available on a website [i.e., outside of the app itself] or through the app,
`regardless of where the user made the original in-app or subscription purchase.” (Dkt. 283
`(Counterclaim) ¶ 29; see also id. ¶ 32.)
`That changed in September 2020, when Google changed its Payments Policy to remove the
`“outside of the app” exception and require apps offering “digital goods and services” to use
`Google’s billing system. (Counterclaim ¶ 43.) But Google extended that compliance deadline and
`continued to allow Match Plaintiffs to offer alternative billing systems, and never purported to
`enforce its new policy against Match Plaintiffs (or any other developer) until June 1, 2022.
`Now that Match Plaintiffs have challenged Google’s anticompetitive conduct and abuse of
`its monopoly power in app distribution and in-app payment processing, Google brings
`counterclaims against Match Plaintiffs, claiming they were in breach all along and then somehow
`engaged in fraud. Nothing could be further from the truth. Google’s own allegations, policies,
`and other documents incorporated in its counterclaims show that Google’s claims either fail as a
`matter of law or should be severely limited.
`Breach of contract. Google alleges that Match Plaintiffs violated the DDA and Payments
`Policy by “using [their] own external payment systems in [their] apps” and “by failing to pay
`
`
`2 For the purposes of this case, those apps include Tinder, OkCupid, Match, PlentyofFish, and
`OurTime.
`
`- 1 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 8 of 21
`
`
`
`Google’s agreed-to service fees on [their] in-app transactions.” (Counterclaim ¶ 59.) But the
`DDA’s exception for “digital content that may be consumed outside the app itself” was in place
`from well before July 11, 20183 to September 2020, when Google updated its Payments Policy.
`(Larsen Decl., Exs. 1, 4.) Google later granted app developers (including Match Plaintiffs) an
`“extension” to, effectively, June 1, 2022 to comply with the new Payments Policy. (Larsen Decl.,
`Ex. 5.) Google’s breach of contract claim should thus be limited to conduct after June 1, 2022.
`False promise. Google alleges that Match Plaintiffs made false “representations that
`[Match Plaintiffs] would comply with the DDA” to obtain the extension to comply with Google’s
`new Payments Policy. Google identifies two purported “promises”: (1) an email from Peter
`Foster wherein Mr. Foster expressly states Match Plaintiffs will not comply, and (2) Match
`Plaintiffs’ response of “yes” to Google’s extension form question, “Do you need more time to
`comply with Google Play’s Payments policy?” (Counterclaim ¶ 50.) Neither statement is a
`promise to do anything.
`Breach of implied covenant. Google’s implied covenant claim rests on the same conduct
`underlying the false promise claim and fails for the same reasons.
`Quasi-contract. California law is clear that when two parties’ relationship is governed by
`an express contract (here, at least as Google alleges, the DDA), Google cannot plead both a breach
`of contract claim and a quasi-contract claim unless Google also alleges, in the alternative, that the
`DDA is unenforceable or invalid. Google does not plead that, so it has not adequately pleaded its
`quasi-contract claim.4
`BACKGROUND
`II.
`For the purposes of Match Plaintiffs’ motion, Match Plaintiffs take Google’s allegations as
`true, as is required on a motion to dismiss. Match Plaintiffs first published a dating app on Google
`
`
`3 July 11, 2018 is the beginning of the four-year statute of limitations period applicable to Google’s
`breach of contract claim under Cal. Code Civ. Proc. § 337(a). Google has not alleged that it seeks
`to recover prior to the start of the limitations period.
`4 Match Plaintiffs do not challenge, in this motion, Google’s declaratory judgment claim or whether
`Google has adequately pleaded a breach of contract claim for the period following June 1, 2022, but
`reserves all rights to do so and to raise other defenses (e.g., laches) at the appropriate time.
`- 2 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 9 of 21
`
`
`
`Play (then called Android Market) in 2010. (Counterclaim ¶ 40.) In the twelve years since, Match
`Plaintiffs and their associated brands and sister entities published over thirty other apps on the
`Google Play Store (id.), and those apps have collectively been downloaded nearly 100 million
`times from Google Play (id. ¶ 31).
`Because Match Plaintiffs distribute apps through Google Play, the relationship between
`Match Plaintiffs and Google is governed by Google’s DDA. (Counterclaim ¶ 43.) Among other
`things, the DDA prohibits apps from “lead[ing] users to a payment method other than Google
`Play’s billing system,” and requires that app developers pay Google a “service fee on the in-app
`sale of digital goods, including subscriptions.” (Counterclaim ¶ 58 (citing DDA ¶ 3.4).)
`The DDA also incorporates all of Google’s “Developer Program Policies,” including the
`Payments Policy. (Counterclaim ¶ 43 (citing DDA ¶ 4.1).) The Payments Policy has changed
`over the years. In particular, from at least 2016 until September 2020, the Payments Policy
`generally required use of Google Play’s payment system, but contained an exception for “digital
`content that may be consumed out of the app itself”:
`
`(Larsen Decl., Ex. 1.) On September 28, 2020, Google changed its Payments Policy to remove the
`“outside of the app” exception, among other changes. (Counterclaim ¶ 43.) Google alleges that
`the new Payments Policy applies to app developers because the “DDA expressly provides that
`Google may make changes to the DDA at any time.” (Id.)
`When it announced its September 2020 policy change, Google “afforded non-compliant
`developers over a year, until September 30, 2021, to make any necessary changes” to their apps.
`(Counterclaim ¶ 48.) This initial extension was automatic; no application was required to receive
`it. But when the initial one-year period was almost up, Google offered a “form accessible to all
`developers” which, if completed and subsequently accepted by Google, further extended the
`
`- 3 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 10 of 21
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`
`deadline to March 31, 2022. (Counterclaim ¶¶ 50–52.) Google later announced that “[s]tarting
`June 1, 2022,” apps that continued to offer alternative payments “will be removed from Google
`play.” (Larsen Decl., Ex. 5.)
`Match Plaintiffs complied with Google’s procedures. On August 5, 2021, Match Plaintiffs’
`Peter Foster emailed Google’s Brandon Barras and stated, “I am reaching out regarding Google’s
`announcement that it is granting extensions to its September 30, 2021 deadline for apps to use
`Google Play’s billing system exclusively. In light of this extension, Match will continue to use its
`bespoke payment system to process payments.” (Larsen Decl., Ex. 2 (emphasis added).) Mr.
`Barras responded that Match would need to “appeal for an extension” by filling out Google’s
`prescribed form, and would need to do so for each app. (Id.)
`Per Mr. Barras’s instructions, Match Plaintiffs submitted Google’s required forms. In
`response to Google’s question, “[t]his extension is intended to aid developers that need more time
`to comply with Google Play’s Payments policy. Do you need more time to comply with Google
`Play’s Payments policy?”, Match Plaintiffs answered “Yes[.]” (Larsen Decl., Ex. 3.) And in
`response to Google’s request that Match Plaintiffs “[p]lease explain why you need additional time
`to comply with Google Play’s Payments policy,” Match Plaintiffs responded, “Our bespoke
`payment system is critical to our user experience. Due to significant feature gaps (payment / subs /
`discounts), Google’s system is not a suitable substitute and exclusive use of Google’s systems will
`meaningfully harm our users (inflate prices) & undermine our business[.]” (Id. (emphasis
`added).) Google granted Match Plaintiffs an extension to March 31, 2022. (Counterclaim ¶ 51.)
`Following Match Plaintiffs’ complaint, and pursuant to the parties’ stipulation entered May
`22, 2022, Match Plaintiffs’ apps remain on Google’s Play Store—and consistent with Mr. Foster’s
`statement, those apps continue to use Match Plaintiffs’ own payment processing system.
`Google now brings five counterclaims against Match Plaintiffs for (1) breach of contract,
`based on the DDA and Payments Policy, (2) breach of the implied covenant of good faith and fair
`dealing, based on Match Plaintiffs’ purportedly having “misled Google to believe that Match”
`Plaintiffs would “comply with the DDA’s Payment policy,” (3) false promise, based on Match
`Plaintiffs’ alleged promise to “comply with the DDA,” (4) quasi-contract, based on Match
`
`- 4 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 11 of 21
`
`
`
`Plaintiffs’ alleged “induc[ement]” to Google to “make modifications to its billing systems and
`provide distribution and other services,” and (5) declaratory judgment. (Counterclaim ¶¶ 55–86.)
`III. LEGAL STANDARD
`A complaint must be dismissed unless it “contain[s] sufficient factual matter, accepted as
`true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678
`(2009) (citation omitted). The Court accepts factual allegations as true, but that rule is
`“inapplicable to legal conclusions.” Id. The Court need not “accept as true allegations that are
`merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Sci.
`Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008).
`“In alleging fraud or mistake, a party must state with particularity the circumstances
`constituting fraud or mistake.” Fed. R. Civ. P. 9(b). Under Rule 9(b), a plaintiff “must allege ‘the
`who, what, when, where, and how of the misconduct charged,’ including what is false or
`misleading about a statement, and why it is false.” United States ex rel. Swoben v. United
`Healthcare Ins. Co., 848 F.3d 1161, 1180 (9th Cir. 2016) (citation omitted). Specifically, “[i]n a
`fraud action against a corporation, a plaintiff must ‘allege the names of the persons who made the
`allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said
`or wrote, and when it was said or written.’” Dooms v. Fed. Home Loan Mortg. Corp., No. CV F
`11-0352 LJO DLB, 2011 WL 1232989, at *14 (E.D. Cal. Mar. 31, 2011) (quoting Tarmann v.
`State Farm Mut. Auto. Ins. Co., 2 Cal. App. 4th 153, 157 (1991)).
`On a motion to dismiss, the Court may consider “documents attached to the complaint,
`documents incorporated by reference in the complaint, or matters of judicial notice[.]” United
`States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003). A document may be “incorporated by
`reference into a complaint if the plaintiff refers extensively to the document or the document forms
`the basis of the plaintiff’s claim.” Id.; First Advantage Background Servs. Corp. v. Private Eyes,
`Inc., 569 F. Supp. 2d 929, 944 n.3 (N.D. Cal. 2008) (“Where a plaintiff alleges the contents of a
`document in the complaint, but does not attach the document, the defendant may provide that
`document to the court, and the court may consider it on a Rule 12(b)(6) motion to dismiss.”).
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`- 5 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 12 of 21
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`
`IV. ARGUMENT
`Google’s Breach of Contract Claim Fails in Four Relevant Periods
`A.
`To state a breach of contract claim under California law, Google must allege the
`“(1) existence of the contract; (2) plaintiff’s performance or excuse for nonperformance;
`(3) defendant’s breach; and (4) damages to plaintiff as a result of the breach.” Miles v. Deutsche
`Bank Nat’l Tr. Co., 236 Cal.App.4th 394, 402 (2015). For the majority of the relevant period
`(7/11/2018 to present), Google’s claim fails as a matter of law because Match Plaintiffs did not
`breach anything. Instead, Google expressly permitted the conduct it now claims was breach all
`along. As a result, Match Plaintiffs ask the Court to dismiss Google’s counterclaim as to four
`relevant periods: (1) prior to September 28, 2020, during which Google’s prior Payments Policy
`was in effect; (2) September 28, 2020 to September 30, 2021, during which Google granted all
`developers a blanket extension to comply with the new Payments Policy; (3) September 30, 2021
`to March 31, 2022, during which Google granted Match Plaintiffs a further extension; and
`(4) March 31, 2022 to June 1, 2022, up until Google’s announcement that it would “start[]”
`removing apps that continued to offer alternative payments.
`Until September 28, 2020, Google’s Payments Policy permitted alternative
`1.
`
`payment systems for apps with certain kinds of digital content
`The basic thrust of Google’s claim is that Google’s DDA and Payments Policy allegedly
`“expressly require[] that Match [Plaintiffs] use Google Play’s billing system for in-app purchases
`. . . and that Google be paid a service fee on such in-app purchases”; Google alleges that Match
`Plaintiffs breached by “using [their] own external payment systems” and “failing to pay” Google’s
`“service fees.” (Counterclaim ¶¶ 58–59.) But Google quotes only from its current Payments
`Policy and mentions only in passing that its Payment Policies have changed during the relevant
`time period. Google does not acknowledge or quote from the language of the old Payments Policy
`at all, and does not attach either the DDA, the current Payments Policy, or the old Payments Policy
`to its counterclaims. The Court need not play along with Google’s attempt to hide the ball.
`Instead, the Court can and should consider the DDA and Payments Policy (both new and
`old) because they are incorporated by reference in Google’s counterclaims and “form[] the basis
`
`- 6 -
`MATCH PLAINTIFFS’ MOTION TO DISMISS GOOGLE DEFENDANTS’ COUNTERCLAIMS
`
`
`
`
`6228763
`
`

`

`Case 3:21-md-02981-JD Document 305 Filed 08/01/22 Page 13 of 21
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`of” Google’s claims. Ritchie, 342 F.3d at 908 (9th Cir. 2003). Though Google’s Payments Policy
`
`now requires app developers like Match Plaintiffs to use Google’s billing system in violation of
`federal and state law (Larsen Decl., Ex. 4), that was not always the case. Until September 28,
`2020 (Counterclaim ¶ 43), Google’s prior Payments Policy expressly allowed app developers like
`Match Plaintiffs to bypass “Google Play In-app Billing” when “[p]ayment is for digital content
`that may be consumed outside of the app itself.” (Larsen Decl., Ex. 1.)
`The Court’s analysis need not go further than Google’s own allegations, which admit that
`Match Plaintiffs satisfied the “outside of the app” exception. For example, Google alleges that
`Match Plaintiffs sell “digital content” and that Match Plaintiffs’ subscription and á la carte
`products can be consumed outside of Match Plaintiffs’ dating apps: the “premium” features that
`Match Plaintiffs sell through apps are “available on a website or through the app, regardless of
`where the user made the original in-app or subscription purchase.” (Counterclaim ¶¶ 29, 41, 43,
`58; see also id. ¶ 32.)
`“Resolution of contractual claims on a motion to dismiss is proper if the terms of the
`contract are unambiguous.” Bedrosian v. Tenet Healthcare Corp., 208 F.3d 220 (9th Cir. 2000).
`The old Payments Policy is unambiguous: if “digital content” (e.g., subscriptions) can be
`“consumed outside the app itself” (i.e., on another platform, such as on a website), an app
`developer did not have to use Google’s billing system or pay a commission on sales made through
`that billing system. But even if that language were ambiguous when considered in isolation,
`Google’s admissions render the pre-September 28, 2020 Payments Policy clear and unambiguous
`as to Match Plai