Case 5:18-cv-00147-EJD Document 112 Filed 06/08/22 Page 1 of 24
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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`IN RE APPLE PROCESSOR LITIGATION
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`Case No. 18-cv-00147-EJD
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`ORDER GRANTING MOTION TO
`DISMISS WITH LEAVE TO AMEND
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`Re: Dkt. No. 96
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`Putative class action Plaintiffs (“Plaintiffs”) are purchasers or lessors of certain Apple
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`products (“iDevices”), each containing a processor that Plaintiffs allege suffers from a design
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`defect that allows unauthorized third parties to access sensitive user data. Plaintiffs bring this
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`lawsuit against Defendant Apple Inc. (“Apple”), alleging that they paid more for their iDevices
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`than they were worth because Apple knowingly omitted the defect; the value of Plaintiffs’
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`products has diminished; and Apple’s attempts to mitigate the defects with patches through
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`software updates materially slowed down the performance of their iDevices.
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`Apple has filed a renewed motion to dismiss (“Mot.”) Plaintiffs’ second consolidated
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`amended complaint (“SCAC”) with prejudice under Federal Rule of Civil Procedure 12(b)(6) for
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`inadequate pleading of their misrepresentation, omission, restitution, and injunctive relief claims.
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`I.
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`BACKGROUND1
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`a. The Parties
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`Plaintiffs are Jennifer Abrams (CA), Anthony Bartling (NH), Robert Giraldi (NY), and
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`1 The background is a summary of the allegations in the SCAC and does not rely on any exhibits
`that Apple has “referenced for background.” Mot. 3 n.2.
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`Jacqueline Olson (NY) (“Plaintiffs”) who, on behalf of themselves and all others similarly
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`situated, allege that certain Apple products such as iPhones, iPads, and the Apple TV (collectively
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`“iDevices”) all contain a central processing unit that is defective. SCAC ¶ 1.
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`Plaintiffs bring their class action pursuant to Federal Rule of Civil Procedure 23 and seek
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`to represent a class that consists of:
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`All persons in the United States who purchased or leased from Apple
`and/or its authorized retailer sellers one or more iPhones, iPads, Apple
`TVs, or other products containing processors designed or modified by
`Apple, at any time since January 1, 2010.
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`Id. ¶ 115. Plaintiffs also seek to represent three subclasses: the “California Subclass,” the “New
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`Hampshire Subclass,” and the “New York Subclass.” Id. ¶ 117. These classes are comprised of
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`members who purchased such iDevices within their respected states. Id.
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`Defendant Apple, Inc. is a business incorporated in Delaware with a principal place of
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`business in Cupertino, California. Apple designs, manufactures, distributes, and sells products
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`including the iDevices and other computing devices that contain processors. Id. ¶ 18.
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`b. The Alleged Defect
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`Each of Plaintiffs’ iDevices contains a central processing unit, also referred to as a
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`processor (“CPU” or “Processor”) that carries out the instructions of programs running on the
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`iDevices. SCAC ¶ 24. These Processors are based on architecture licensed from engineering firm
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`ARM Holdings but are uniquely modified and designed by Apple. Id. ¶¶ 43-45. As relevant here,
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`Apple customizes its Processors using two optimization techniques to improve performance:
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`“speculative execution,” which allows processors to anticipate and execute certain tasks
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`preemptively; and “out-of-order execution,” which allows a program’s instructions to be executed
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`in parallel or out of order, as opposed to strictly sequentially. Id. ¶ 30-31. These optimization
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`techniques require specific modifications at the physical hardware level of each Processor. Id. ¶
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`52. Apple’s Processors are used exclusively in Apple products, and the Processor within each
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`iDevice works with Apple’s operating system (“iOS”) to execute the device’s programs and
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`instructions. Id. ¶¶ 24-25, ¶ 48.
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`Case No.: 18-cv-00147-EJD
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`In 2017, independent security researchers discovered that certain processors contain two
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`vulnerabilities—referred to by Plaintiffs as “Meltdown” and “Spectre,” and collectively as the
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`“Defects”—that allow unauthorized third parties to access sensitive user data. Id. ¶ 2.
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`Specifically, Apple’s implementation of speculative and out-of-order execution allegedly allows
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`bad actors to access sensitive data that would normally need to process through security checks or
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`require isolation within the OS. Id. ¶¶ 36-42, 49-51. The security issues raised by Meltdown and
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`Spectre are not limited to only Apple Processors but may affect different manufacturers’
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`processors differently, depending on how they had modified the original ARM processor
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`architecture. Id. ¶¶ 49-51.
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`Plaintiffs allege that Apple was notified of the Defects in June 2017 but did not publicly
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`disclose them until January 4, 2018, after a New York Times article leaked the vulnerabilities. Id.
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`¶¶ 83-84. In that public announcement—which was made ahead of a coordinated disclosure date
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`previously agreed upon by Apple, Intel, Google, Microsoft, Amazon, AMD, and ARM—Apple
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`addressed speculative execution and Meltdown, disclosing that its December 2, 2017 iOS 11.2
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`update included a software update to address the vulnerability. Id. ¶ 54. On January 8, 2018,
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`Apple separately released iOS 11.2.2, a software update to address Spectre. Id. Plaintiffs assert
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`that these vulnerabilities are material because, “had they known data stored on their systems
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`would be compromised and made available to unauthorized third parties,” they would not have
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`purchased their iDevices or paid the price they did. Id. ¶ 68. After Apple made the
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`announcements, the iDevices allegedly declined in value. Id. ¶¶ 71–79.
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`c. Apple’s Representations of Its Processors
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`Plaintiffs allege that Apple made various representations to the public through “extensive
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`and long-term advertising and promotion efforts” regarding the benefits, capabilities, and quality
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`of Apple Processors and iDevices. SCAC ¶ 86. The SCAC identified various statements from
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`Apple advertising iPhones 4, 5, 5s, 6, 6 Plus, 6s, 6s Plus, 7, 7 Plus, 8, 8 Plus, X, as well as various
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`generations of iPads. Id. ¶¶ 87-112. These statements included the following assertions regarding
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`the performance of Apple Processors:
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`• A4 Processor: “provides exceptional processor and graphic performance along with
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`long battery life” (Id. ¶ 87);
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`• A6 Processor: “maximize performance and power efficiency . . . up to twice the
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`CPU and graphics performance” (Id. ¶ 89);
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`• A6X Processor: “delivers up to twice the CPU performance and up to twice the
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`graphics performance of the A5X chip” (Id. ¶ 102);
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`• A7 Processor: “brings 64-bit desktop-class architecture to a smartphone . . . up to
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`twice the CPU and graphics performance” (Id. ¶ 90);
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`• A8 Processor: “faster performance and is more energy efficient, delivering higher
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`sustained performance with great battery life” (Id. ¶ 91);
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`• A8X Processor: “delivers a 40 percent improvement in CPU performance and 2.5
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`times the graphics performance of iPad Air” (Id. ¶ 104);
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`• A9 Processor: “70 percent faster CPU and 90 percent faster GPU performance than
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`the A8, all with gains in energy efficiency for great battery life” (Id. ¶ 92);
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`• A10 Fusion Processor: “run[s] up to two times faster than iPhone 6. . . [and is]
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`capable of running at just one-fifth the power of the high-performance cores.
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`Graphics performance is also more powerful, running up to three times faster than
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`iPhone 6 at as little as half the power” (Id. ¶ 93);
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`• A10X Fusion Processor: “up to 30 percent faster CPU performance and 40 percent
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`graphics performance than the industry-leading A9X chip” (Id. ¶¶ 108-09); and
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`• A11 Bionic Processor: “features a six-core CPU design with two performance cores
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`that are 25 percent faster and four efficiency cores that are 70 percent faster than
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`the A10 Fusion . . . delivering up to 70 percent greater performance for multi-
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`threaded workloads . . . up to 30 percent faster graphics performance than the
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`previous generation” (Id. ¶ 95).
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`Additionally, Plaintiffs identified two video commercials on YouTube that depict the
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`iPhone as being more secure and private than other phones, which included the following
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`statements in the videos’ YouTube descriptions:
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`• “Access to the latest updates keeps your iPhone secure. Life’s easier when you
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`switch to iPhone.” (Id. ¶ 111); and
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`• “We build iPhone with your privacy in mind. Life’s easier when you switch to
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`iPhone.” (Id. ¶ 112).
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`d. Procedural History
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`On June 8, 2018, Plaintiffs filed a consolidated amended complaint against Apple alleging
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`sixteen causes of action. ECF No. 46. On August 7, 2018, Apple filed a motion to dismiss, which
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`the Court granted on standing grounds with leave to amend. ECF Nos. 49, 66. On February 21,
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`2019, Plaintiffs filed the Second Consolidated Amended Complaint, asserting seven causes of
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`action. ECF No. 72. Apple again moved to dismiss Plaintiffs’ SCAC for lack of standing or any
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`cause of action, which the Court granted again on standing grounds without leave to amend and
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`entered judgment in favor of Apple. ECF Nos. 75, 88-89.
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`On appeal, a Ninth Circuit panel held that Plaintiffs had sufficiently pled standing but
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`expressly declined to address Apple’s Rule 12(b)(6) arguments, leaving that task to this Court in
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`the first instance. ECF No. 93. On remand, the parties stipulated to renewed and updated briefing
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`on Apple’s 12(b)(6) defenses, ECF No. 95, which is presently before the Court.
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`II.
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`LEGAL STANDARDS
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`Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with sufficient
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`specificity to “give the defendant fair notice of what the . . . claim is and the grounds upon which
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`it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations omitted).
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`Although particular detail is not generally necessary, the factual allegations “must be enough to
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`raise a right to relief above the speculative level” such that the claim “is plausible on its face.” Id.
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`at 555, 570. A complaint which falls short of the Rule 8(a) standard may be dismissed if it fails to
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`state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). Dismissal of a claim
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`under Rule 12(b)(6) may be based on a “lack of a cognizable legal theory or the absence of
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`sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep’t, 901
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`F.2d 696, 699 (9th Cir. 1988) (internal citation omitted); see Ministerio Roca Solida v. McKelvey,
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`820 F.3d 1090, 1096 (9th Cir. 2016).
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`Claims that sound in fraud are further subject to a heightened pleading standard. Fed. R.
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`Civ. Proc. 9(b) (“In alleging fraud or mistake, a party must state with particularity the
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`circumstances constituting fraud or mistake.”); Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097,
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`1103–04 (9th Cir. 2003) (recognizing that claims “grounded in fraud” or which “sound in fraud”
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`must meet the Rule 9(b) pleading standard, even if fraud is not an element of the claim). The
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`allegations must be “specific enough to give defendants notice of the particular misconduct which
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`is alleged to constitute the fraud charged so that they can defend against the charge and not just
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`deny that they have done anything wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir.
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`1985). This requires an account of the “time, place, and specific content of the false
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`representations as well as the identities of the parties to the misrepresentations.” Swartz v. KPMG
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`LLP, 476 F.3d 756, 764 (9th Cir. 2007) (quoting Edwards v. Marin Park, Inc., 356 F.3d 1058,
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`1066 (9th Cir. 2004)). In other words, fraud or claims asserting fraudulent conduct must generally
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`contain more specific facts than is necessary to support other causes of action. That said, with
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`respect to omissions-based fraud claims, “the pleading standard is lowered on account of the
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`reduced ability in an omission suit ‘to specify the time, place, and specific content, relative to a
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`claim involving affirmative misrepresentations.’” Barrett v. Apple Inc., 2021 WL 827235, at *7
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`(N.D. Cal. Mar. 4, 2021) (quoting In re Apple & AT&T Mobility Antitrust Litig., 596 F. Supp. 2d
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`1288, 1310 (N.D. Cal. 2008)).
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`At the motion to dismiss stage, the Court must read and construe the complaint in the light
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`most favorable to the non-moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337–38 (9th
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`Cir. 1996). Additionally, the Court must accept as true all “well-pleaded factual allegations.”
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`Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). However, “courts are not bound to accept as true a
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`legal conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555. Nor is a complaint
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`sufficient if it merely “tenders naked assertions devoid of further factual enhancement.” Iqbal,
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`556 U.S. at 678 (internal quotation marks omitted). “In all cases, evaluating a complaint’s
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`plausibility is a ‘context-specific’ endeavor that requires courts to draw on . . . judicial experience
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`and common sense.” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th Cir. 2014) (quoting Starr v.
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`Baca, 652 F.3d 1202, 1216 (9th Cir. 2011)). When deciding whether to grant a motion to dismiss,
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`the Court generally “may not consider any material beyond the pleadings.” Hal Roach Studios,
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`Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). However, the Court may
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`consider material submitted as part of the complaint or relied upon in the complaint, and may also
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`consider material subject to judicial notice. 2 See Lee v. City of Los Angeles, 250 F.3d 668, 688–
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`89 (9th Cir. 2001); Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th Cir. 2003)
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`(holding the court is “not required to accept as true conclusory allegations which are contradicted
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`by documents referred to in the complaint.”).
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`In the event that a motion to dismiss is granted, “leave to amend should be granted ‘unless
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`the court determines that the allegation of other facts consistent with the challenged pleading could
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`not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., 957 F.2d 655, 658 (9th Cir.
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`1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir.
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`1986)). Leave to amend may also be denied if allowing amendment would unduly prejudice the
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`opposing party, cause undue delay, or be futile, or if the moving party has acted in bad faith. See
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`Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008).
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`III. DISCUSSION
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`Plaintiffs bring seven counts against Apple in the SCAC, asserting causes of action arising
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`from California, New York, New Hampshire, and common law. Plaintiffs’ Counts I, III, IV, V,
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`and VII allege violations of the California Consumers Legal Remedies Act (“CLRA”), the New
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`Hampshire Consumer Protection Act (“NHCPA”), two sections of the New York General
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`Business Law (“GBL”), and common law fraud, respectively. Because these claims are all
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`grounded in the same unified course of fraudulent conduct, see SCAC ¶¶ 134-137, 150-155, 158-
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`2 Pursuant to Federal Rule of Evidence 201, the Court may take judicial notice of matters of public
`record but may not take judicial notice of a fact that is subject to reasonable dispute. Fed. R. Evid.
`201(b). Here, the Court declines to take judicial notice of Apple’s Exhibits A – I, ECF No. 97,
`because they were not required to reach its conclusions in this Order.
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`161, 163-166, 174-178, the Court will refer to these five Counts collectively as Plaintiffs’ “Fraud
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`Claims” and apply Rule 9(b)’s heightened pleading requirements to all five Counts.3
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`Plaintiffs also seek equitable restitution under Cal. Bus. & Prof. Code § 17200 (“UCL”) as
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`Count II and for unjust enrichment as Count VI. SCAC ¶¶ 147, 167-172. Additionally, Plaintiffs
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`seek injunctive relief for their CLRA and UCL claims for Apple to be “permanently enjoined and
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`restrained from continuing and maintaining the violations alleged herein.” SCAC ¶¶ 137, 147; see
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`also SCAC at 41.
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`a. Fraud Claims
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`Plaintiffs assert fraud-based claims under the CLRA, the New York GBL, and the
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`NHCPA, the elements of which are set forth below. SCAC ¶¶ 128-178. These theories of fraud
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`are based on both affirmative misrepresentation and material omissions. Id. ¶¶ 86, 173-178.
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`The CLRA prohibits an enumerated list of unfair or deceptive business practices that may
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`not be undertaken in a sale or lease of goods. Cal. Civ. Code § 1770(a). Plaintiffs allege that
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`Apple violated two of these prohibited practices: § 1770(a)(5) (“[r]epresenting that goods or
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`services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that
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`they do not have”) and § 1770(a)(7) (“[r]epresenting that goods or services are of a particular
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`standard, quality, or grade, or that goods are of a particular style or model, if they are of another”).
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`SCAC ¶¶ 134-35. “Three elements are necessary to state a claim under the CLRA:
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`misrepresentation, reliance, and damages.” Yastrab v. Apple Inc., 173 F. Supp. 3d 972, 977 (N.D.
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`Cal. 2016).
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`New York GBL § 349 prohibits “[d]eceptive acts or practices in the conduct of any
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`business, trade or commerce,” and § 350 specifically prohibits false advertising. N.Y. Gen. Bus.
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`Law §§ 349, 350. To state a GBL claim, a plaintiff must allege “(1) the act or practice was
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`3 Plaintiffs’ Opposition sets out each statutory claim in separate sections but presents largely the
`same arguments and factual bases for each claim, usually in one or two paragraphs. See Opp. 18-
`22. The only distinction among the various statutory fraud claims is the observation that the
`NHCPA only requires an “overall misleading impression” from a defendant’s representations,
`even if each representation may be read as literally true. Opp. 21-22, citing Beer v. Bennett, 160
`N.H. 166, 170, 993 A.2d 765, 768 (2010).
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`consumer-oriented; (2) the act or practice was misleading in a material respect; and (3) the
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`plaintiff was injured as a result.” Gold v. Lumber Liquidators, Inc., No. 14-CV-05373-TEH, 2015
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`WL 7888906, at *11 (N.D. Cal. Nov. 30, 2015) (citing Spagnola v. Chubb Corp., 574 F.3d 64, 74
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`(2d Cir. 2009)).
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`The NHCPA broadly prohibits the use of “any unfair or deceptive act or practice in the
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`conduct of any trade or commerce,” and provides a non-exhaustive list of deceptive practices.
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`N.H. Rev. Stat. Ann. § 358-A:2. The SCAC alleges violations specifically of § 358-A:2(VII),
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`“[r]epresenting that goods or services are of a particular standard, quality, or grade, or that goods
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`are of a particular style or model, if they are of another,” the language of which largely resembles
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`§ 1770(a)(7) of the CLRA. SCAC ¶ 149. The Supreme Court of New Hampshire has also held
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`that, even if any individual representation could be read as literally true, an advertisement could
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`still violate the NHCPA if “it created an overall misleading impression.” Beer v. Bennett, 160
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`N.H. 166, 170 (2010).
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`Apple argues that, with respect to all of Plaintiffs’ Fraud Claims, the SCAC fails to allege
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`at least three necessary elements: an actionable misrepresentation (either made affirmatively or by
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`omission), reliance, and damages. Mot. 7. As discussed further below, the Court finds that
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`Plaintiffs have failed to allege an affirmative misrepresentation, an actionable omission, and actual
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`reliance, so the Court does not reach Apple’s arguments on damages.
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`i. Affirmative Misrepresentation
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`Plaintiffs claim that Apple made affirmative representations regarding (1) the privacy and
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`security of iPhones, and (2) the speed and performance of its Processors. Opp. 16. Apple argues
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`that Plaintiffs’ affirmative misrepresentation theory fails on two fronts: first, Plaintiffs’ alleged
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`misrepresentations are too general to be actionable; and second, Plaintiffs have failed to allege that
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`any specific representation was false. Mot. 7-9.
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`To satisfy Rule 9(b), a pleading alleging fraud must identify “the who, what, when, where,
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`and how of the misconduct charged,” as well as “what is false or misleading about [the
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`purportedly fraudulent] statement, and why it is false.” Cafasso, U.S. ex rel. v. Gen. Dynamics C4
`
`Case No.: 18-cv-00147-EJD
`ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND
`9
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`Northern District of California
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`United States District Court
`
`

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`Case 5:18-cv-00147-EJD Document 112 Filed 06/08/22 Page 10 of 24
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`Sys., Inc., 637 F.3d 1047, 1055 (9th Cir. 2011). Affirmative statements are only actionable under
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`the CLRA if they are “likely to deceive a reasonable consumer. Advertisements that amount to
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`mere puffery are not actionable because no reasonable consumer relies on puffery.” Stickrath v.
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`Globalstar, Inc., 527 F. Supp. 2d 992, 998 (N.D. Cal. 2007) (internal citations and quotation
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`marks omitted). For example, statements generally claiming that one product is superior are not
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`actionable, but misdescriptions of specific or absolute characteristics of a product are actionable.
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`See Elias v. Hewlett-Packard Co., 950 F. Supp. 2d 1123, 1133 (N.D. Cal. 2013) (quoting Cook,
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`Perkiss and Liehe, Inc. v. Northern Cal. Collection Serv., Inc., 911 F.2d 242, 246 (9th Cir.1990)).
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`With respect to privacy and security representations, Plaintiffs claim that Apple advertises
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`iPhones as “secure” and built “with your privacy in mind,” which was misleading given the
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`devices’ vulnerability to Spectre and Meltdown. Opp. 16, citing SCAC ¶¶ 111-12. However,
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`these representations do not speak to any specific or absolute characteristics about the iPhones’
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`security and are the type of statements that many courts have held to be non-actionable puffery.
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`See, e.g., Elias, 950 F. Supp. 2d at 1132 (holding that generalized advertisements that a computer
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`is “ultra-reliable” or “packed with power” are non-actionable because they “say nothing about the
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`specific characteristics or components of the computer”); cf. Cook, Perkiss & Liehe, Inc. v. N.
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`California Collection Serv. Inc., 911 F.2d 242, 246 (9th Cir. 1990) (finding statements that lamps
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`are “far brighter than any lamp ever before offered for home movies” are non-actionable but
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`statements that lamps had “35,000 candle power and 10-hour life” were actionable). Plaintiffs rely
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`primarily on Apple’s statement in a commercial that it builds iPhones “with your privacy in
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`mind,” but does not explain how a reasonable consumer would view this statement as “as anything
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`more weighty than an advertising slogan.” Consumer Advocs. v. Echostar Satellite Corp., 113
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`Cal. App. 4th 1351, 1361, 8 Cal. Rptr. 3d 22, 29 (2003). Even assuming that this statement could
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`be interpreted literally to imply that Apple employees were designing iPhones with special
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`contemplation of consumer privacy, Plaintiffs have not shown how this implication would be
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`false, i.e., that Apple employees did not indeed design iPhones with privacy considerations. To
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`the extent Plaintiffs rely on the existence of the Spectre and Meltdown vulnerabilities to establish
`
`Case No.: 18-cv-00147-EJD
`ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND
`10
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 5:18-cv-00147-EJD Document 112 Filed 06/08/22 Page 11 of 24
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`that these statements were false, they have alleged that Apple only learned of these Defects in June
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`2017,4 while the video commercial and statement at issue were posted on May 22, 2017. SCAC
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`¶¶ 83, 112.
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`Plaintiffs also allege that Apple advertises its Processors as faster, more powerful, and
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`having better battery life than prior generations. These statements, Plaintiffs assert, were
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`misleading because the Processors would be significantly slower than advertised once Apple’s
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`mitigation efforts were implemented. Opp. 16, citing SCAC ¶¶ 91, 95, 97, 99-100; see also supra
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`I.C. Some of these representations are “all-but-meaningless superlatives,” see Consumer Advocs,
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`113 Cal. App. 4th at 1361, such as the A11 Bionic Processor being touted as “the most powerful
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`and smartest chip ever in a smartphone.” SCAC ¶ 95. Again, these statements say nothing about
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`the specific characteristics or components about the Processors and are thereby too vague to be
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`actionable. To the extent Plaintiffs argue that these performance representations are nonetheless
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`misleading because future mitigation efforts would inevitably impair device performance, see
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`SCAC ¶¶ 134-35, they do not identify any specific standard of performance that the Processors
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`failed to meet post-mitigation nor do they explain how Apple’s performance statements were
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`“false when [] made.” Hauck, 2019 WL 1493356, at *5.
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`That said, some statements cited in the SCAC do include more specific and measurable
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`claims that could conceivably be actionable, namely those that assert a specific Processor is some
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`percent faster than the previous generation’s Processor. See, e.g., SCAC ¶¶ 90, 92-93, 95, 102,
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`104, 108-09 (stating that the A10X Fusion Processor is “up to 30 percent faster CPU performance
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`and 40 percent graphics performance than the industry-leading A9X chip”). However, with
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`4 Plaintiffs do attempt to impute knowledge onto Apple prior to June 2017 in a single paragraph,
`relying on a 1995 academic paper and an unspecified 2012 iOS update. SCAC ¶ 5. However,
`these allegations fail to allege actual knowledge under the heightened pleading standard of Fed. R.
`Civ. P. 9(b). See Hauck v. Advanced Micro Devices, Inc., No. 18-CV-00447-LHK, 2018 WL
`5729234, at *6 (N.D. Cal. Oct. 29, 2018) (rejecting knowledge based on “vague, sweeping
`statements about industry research and general knowledge garnered from conferences and
`academic papers of the Defect's potential to exploit processors”); Williamson v. Apple, Inc., No.
`5:11-CV-00377 EJD, 2012 WL 3835104, at *7 (N.D. Cal. Sept. 4, 2012) (finding allegations that
`Apple began work to correct defects based on “sources inside and outside Apple” were insufficient
`to allege actual knowledge under Rule 9).
`Case No.: 18-cv-00147-EJD
`ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND
`11
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 5:18-cv-00147-EJD Document 112 Filed 06/08/22 Page 12 of 24
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`respect to these more specific representations, Plaintiffs do not allege what exactly is false or
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`misleading about them. The SCAC does not contain allegations that a specific Processor—either
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`before or after Apple’s mitigation—fails to perform better than a previous generation’s nor does it
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`contain any comparison of the performance between generations of Apple Processors, which is
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`what Apple advertised. What the SCAC does allege is that the Processors perform measurably
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`worse after the iOS update containing Apple’s mitigation efforts was implemented, SCAC ¶¶ 62-
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`63, but this is not what Apple represented and does not render Apple’s statements regarding
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`generation-to-generation improvements false or misleading.
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`Plaintiffs’ citation to New Hampshire law suggesting that they can maintain a NHCPA
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`violation for an advertisement that was literally true but “created an overall misleading
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`impression” is also unavailing. See Opp. 21-22, citing Beer v. Bennett, 160 N.H. 166, 170 (2010).
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`Plaintiffs do not attempt to apply this as a separate standard to Apple’s statements here nor do they
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`analogize the facts in this case with those in Beer, which involved an inoperable car that was
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`nonetheless advertised to have a motor with “pretty vigorous performance.” Id. at 168. Plaintiffs
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`primarily rely on the same body of arguments and allegations made in their UCL, CLRA, and
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`GBL claims. Opp. 21-22. For the reasons mentioned throughout this Order as to why those other
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`fraud-based claims fail, Plaintiffs have also failed to state a claim under the NHCPA.
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`Because Plaintiffs are unable to identify any statement from Apple that is both sufficiently
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`specific to be actionable and was false when made, Plaintiffs have failed to state a claim for fraud
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`under an affirmative misrepresentation theory.
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`ii. Omission
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`Plaintiffs also advance an omissions-based theory of fraud, alleging that Apple “failed to
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`disclose that the Apple Processors contained in the iDevices suffered from the Defects, the nature
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`of the Defects, that efforts to mitigate the Defects would cause impaired performance of the
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`iDevices, and that the Defects cannot be fully repaired without impairing performance of the
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`iDevices.” SCAC ¶ 174; see also Opp. 8-15. The SCAC defines “Defects” to mean the category
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`of vulnerabilities collectively referred to as Meltdown and Spectre. SCAC ¶ 2.
`
`Case No.: 18-cv-00147-EJD
`ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND
`12
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 5:18-cv-00147-EJD Document 112 Filed 06/08/22 Page 13 of 24
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`“Om