Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 1 of 34
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`
`
`JENNER & BLOCK LLP
`Kate T. Spelman (Cal. Bar No. 269109)
`kspelman@jenner.com
`Alexander M. Smith (Cal. Bar No. 295187)
`asmith@jenner.com
`Madeline P. Skitzki (Cal. Bar No. 318233)
`mskitzki@jenner.com
`633 West 5th Street, Suite 3600
`Los Angeles, CA 90071-2054
`Telephone:
`(213) 239-5100
`Facsimile:
`(213) 239-5199
`
`Attorneys for Defendants
`Apple Inc. and Apple Value Services, LLC
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`
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`CARL BARRETT, et al.,
`
`Plaintiffs,
`
`v.
`
`APPLE INC. and APPLE VALUE SERVICES,
`LLC,
`
`
`
`Defendants.
`
`Case No. 5:20-cv-4812-EJD
`
`The Honorable Edward J. Davila
`
`DEFENDANTS APPLE INC. AND APPLE
`VALUE SERVICES, LLC’S NOTICE OF
`MOTION AND MOTION TO DISMISS
`FIRST AMENDED COMPLAINT;
`MEMORANDUM OF POINTS AND
`AUTHORITIES
`
`(REDACTED FOR PUBLIC FILING)
`
`Hearing Date: August 5, 2021
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`Hearing Time: 9:00 a.m.
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`Courtroom: 4 (San Jose)
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 2 of 34
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`TO THE COURT, ALL PARTIES, AND THEIR COUNSEL OF RECORD:
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`PLEASE TAKE NOTICE that, on August 5, 2021 at 9:00 a.m., or as soon thereafter as the Court
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`is available, in Courtroom 4 of the federal courthouse located at 280 South 1st Street, San Jose, CA 95113,
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`Defendants Apple Inc. and Apple Value Services, LLC (collectively “Apple”) will, and hereby do, move
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`to dismiss Plaintiffs’ First Amended Class Action Complaint pursuant to Federal Rule of Civil Procedure
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`12(b)(6) on the grounds that it fails to state a plausible claim on which relief can be granted.
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`Apple’s Motion is based on this Notice of Motion and Motion, the following Memorandum of
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`Points and Authorities, Apple’s concurrently-filed Request for Judicial Notice and exhibits thereto, any
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`additional briefing on this subject, and the evidence and arguments that will be presented to the Court at
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`the hearing on this matter.
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`
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`DATED: April 28, 2021
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`
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`JENNER & BLOCK LLP
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`By: s/ Kate T. Spelman
`
`Attorney for Defendants
`Apple Inc. and Apple Value Services, LLC
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 3 of 34
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`TABLE OF CONTENTS
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`INTRODUCTION .......................................................................................................................................1
`
`BACKGROUND .........................................................................................................................................3
`
`I.
`
`II.
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`Apple’s Sale of Gift Cards. ..................................................................................................3
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`Plaintiffs’ Claims Against Apple. ........................................................................................3
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`ARGUMENT ...............................................................................................................................................5
`
`I.
`
`II.
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`Plaintiffs Have Still Not Stated a Plausible Aiding-and-Abetting Claim. ...........................5
`
`Plaintiffs’ “Failure-to-Refund” Claims — Including Their Claims for Conversion
`and Receiving Stolen Property — Are Factually Unfounded and Legally
`Implausible. ..........................................................................................................................8
`
`A.
`
`Plaintiffs’ Conversion Claim Fails Because the FAC Does Not Allege That
`Apple Took Any Affirmative Action to Deprive Them of Their Property. .............9
`
`B.
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`Plaintiffs’ Receipt of Stolen Property Claim Is Fatally Defective. ........................10
`
`III.
`
`Plaintiffs Do Not Plausibly Allege That Apple Made Any Affirmative
`Misrepresentation or Deceptive Omission About Its Gift Cards or Its Ability to
`Address Gift Card Scams. ..................................................................................................13
`
`A.
`
`B.
`
`Plaintiffs Do Not Plausibly Allege That Apple Fraudulently Omits
`Information Regarding the Risk of Gift Card Scams From the Packaging of
`Its Gift Cards. .........................................................................................................13
`
`Plaintiffs Do Not Plausibly Allege That Apple Concealed the Extent of Its
`Ability to Address Gift Card Fraud and the Whereabouts of Scammed
`Funds. .....................................................................................................................16
`
`C.
`
`Plaintiffs Have Not Plausibly Alleged Any Affirmative Misrepresentation. ........17
`
`IV.
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`Plaintiffs Do Not Plausibly Allege That Apple Engaged in “Unlawful” or “Unfair”
`Conduct. .............................................................................................................................19
`
`V.
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`Apple’s Disclaimer Is Valid, Enforceable, and Defeats Plaintiffs’ Claims. ......................21
`
`A.
`
`B.
`
`C.
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`Apple’s Disclaimer Is Not Substantively Unconscionable. ...................................21
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`Apple’s Disclaimer Is Not Procedurally Unconscionable. ....................................22
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`Apple’s Disclaimer Independently Defeats Plaintiffs’ Claims. .............................24
`
`VI.
`
`Plaintiffs’ Declaratory Relief Claim Fails Because Their Substantive Claims Also
`Fail. ....................................................................................................................................24
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 4 of 34
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`VII. This Court Should Dismiss Plaintiffs’ Lawsuit With Prejudice. .......................................25
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`CONCLUSION ..........................................................................................................................................25
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 5 of 34
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`TABLE OF AUTHORITIES
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`
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`Page(s)
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`
`
`Cases
`
`Am. Software, Inc. v. Ali,
`46 Cal. App. 4th 1386 (1996) ............................................................................................................... 21
`
`In re Apple & AT&TM Antitrust Litig.,
`596 F. Supp. 2d 1288 (N.D. Cal. 2008) ................................................................................................ 16
`
`In re Apple Inc. Device Performance Litig.,
`386 F. Supp. 3d 1155 (N.D. Cal. 2019) ............................................................................................... 15
`
`Archer v. Coinbase, Inc.,
`53 Cal. App. 5th 266 (2020) ............................................................................................................. 9, 10
`
`Armendariz v. Found. Health Psychare Servs., Inc.,
`24 Cal. 4th 83 (2000) ............................................................................................................................ 21
`
`Ashcroft v. Iqbal,
`556 U.S. 662 (2009) ................................................................................................................................ 5
`
`Baxter v. Intelius, Inc.,
`No. 09-1031, 2010 WL 3791487 (C.D. Cal. Sept. 16, 2010) ............................................................... 22
`
`Boris v. Wal-Mart Stores, Inc.,
`35 F. Supp. 3d 1163 (C.D. Cal. 2014) ............................................................................................ 17, 18
`
`C.W. v. Epic Games, Inc.,
`No. 19-3629, 2020 WL 5257572 (N.D. Cal. Sept. 3, 2020) ................................................................. 15
`
`Cal. Grocers Ass’n v. Bank of Am.,
`22 Cal. App. 4th 205 (1994) ................................................................................................................. 23
`
`Chavarria v. Ralphs Grocery Co.,
`733 F.3d 916 (9th Cir. 2013) ................................................................................................................ 22
`
`Chen v. PayPal, Inc.,
`61 Cal. App. 5th 557, 275 Cal. Rptr. 3d 767 (2021) ............................................................................... 8
`
`Daugherty v. Am. Honda Motor Co.,
`144 Cal. App. 4th 824 (2006) ................................................................................................... 14, 15, 17
`
`Davis v. HSBC Bank Nev., N.A.,
`691 F.3d 1152 (9th Cir. 2012) ........................................................................................................ 22, 24
`
`Diaz v. Intuit, Inc.,
`No. 15-1778, 2018 WL 2215790 (N.D. Cal. May 15, 2018) ............................................................. 6, 7
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 6 of 34
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`Emery v. Visa Int’l Serv. Ass’n,
`95 Cal. App. 4th 952 (2002) ............................................................................................................. 7, 20
`
`In re Ferrero Litig.,
`794 F. Supp. 2d 1107 (S.D. Cal. 2011) ................................................................................................. 18
`
`Fimby-Christensen v. 24 Hour Fitness USA, Inc.,
`No. 13-1007, 2013 WL 6158040 (N.D. Cal. Nov. 22, 2013) .............................................................. 21
`
`Fiol v. Doellstedt,
`50 Cal. App. 4th 1318 (1996) ............................................................................................................. 6, 7
`
`Freeney v. Bank of Am. Corp.,
`No. 15-2376, 2016 WL 5897773 (C.D. Cal. Aug. 4, 2016) ................................................................. 11
`
`Gerard v. Ross,
`204 Cal. App. 3d 968 (1988) .................................................................................................................. 6
`
`He v. Apple Inc.,
`189 A.D.3d 1984 (N.Y. App. Div. 2020) ............................................................................. 7, 11, 23, 24
`
`In re Hoag Urgent Care-Tustin, Inc.,
`No. 19-2485, 2021 WL 1164285 (C.D. Cal. Mar. 26, 2021) .................................................................. 9
`
`Hodsdon v. Mars, Inc.,
`891 F.3d 857 (9th Cir. 2018) .......................................................................................................... 15, 16
`
`Hosp. Mktg. Concepts, LLC v. Six Continents Hotels, Inc.,
`No. 15-1791, 2016 WL 9045621 (C.D. Cal. Jan. 28, 2016) ................................................................. 24
`
`Howard v. Superior Court,
`2 Cal. App. 4th 745 (1992) ............................................................................................................. 6, 7, 8
`
`Hueso v. Select Portfolio Servicing, Inc.,
`No. 18-1892, 2021 WL 1102452 (S.D. Cal. Mar. 23, 2021) .......................................................... 10, 11
`
`Instant Brands, Inc. v. DSV Solutions, Inc.,
`No. 20-399, 2020 WL 5947914 (C.D. Cal. Aug. 20, 2020) ................................................................. 10
`
`In re Jamster Mktg. Litig.,
`No. 05-819, 2009 WL 1456632 (S.D. Cal. May 22, 2009) .................................................................. 20
`
`Kidron v. Movie Acquisition Corp.,
`40 Cal. App. 4th 1571 (1995) ......................................................................................................... 11, 12
`
`Kinney v. United Healthcare Servs., Inc.,
`70 Cal. App. 4th 1322 (1999) ............................................................................................................... 23
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`Lacagnina v. Comprehend Sys., Inc.,
`25 Cal. App. 5th 955 (2018) ................................................................................................................. 10
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 7 of 34
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`
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`Lazar v. Hertz Corp.,
`69 Cal. App. 4th 1494 (1999) ............................................................................................................... 19
`
`Lazy Y Ranch Ltd. v. Behrens,
`546 F.3d 580 (9th Cir. 2008) ................................................................................................................ 14
`
`Miller v. Yokohama Tire Corp.,
` 358 F.3d 616 (9th Cir. 2004) ............................................................................................................... 25
`
`Mirkin v. Wasserman,
`5 Cal. 4th 1082 (1993) .......................................................................................................................... 16
`
`Morris v. Redwood Empire Bancorp,
`128 Cal. App. 4th 1305 (2005) ................................................................................................. 21, 22, 23
`
`Nissan Motor Co. v. Nissan Computer Corp.,
`204 F.R.D. 460 (C.D. Cal. 2001) .......................................................................................................... 25
`
`Pantoja v. Countrywide Home Loans, Inc.,
`640 F. Supp. 2d 1177 (N.D. Cal. 2009) ................................................................................................ 19
`
`Parziale v. HP, Inc.,
`445 F. Supp. 3d 435 (N.D. Cal. 2020) .................................................................................................. 14
`
`People v. Rodriguez,
`177 Cal. App. 3d 174 (1986) ................................................................................................................ 11
`
`People v. Toomey,
`157 Cal. App. 3d 1 (1984) .................................................................................................................... 20
`
`Perfect 10, Inc. v. Visa Int’l Serv. Ass’n,
`494 F.3d 788 (9th Cir. 2007) ............................................................................................................ 7, 20
`
`Pinnacle Museum Tower Ass’n v. Pinnacle Mkt. Dev. (US), LLC,
`55 Cal. 4th 223 (2012) .......................................................................................................................... 21
`
`Punian v. Gilette Co.,
`No. 14-5028, 2016 WL 1029607 (N.D. Cal. Mar. 15, 2016) ............................................................... 13
`
`Red v. Kraft Foods, Inc.,
`No. 10-1028, 2012 WL 5504011 (C.D. Cal. Oct. 25, 2012)................................................................. 18
`
`Roman v. Superior Court,
`172 Cal. App. 4th 1462 (2009) ............................................................................................................. 23
`
`Schulz v. Neovi Data Corp.,
`152 Cal. App. 4th 86 (2007) ................................................................................................................... 7
`
`Sholiay v. Fed Nat’l Mortg. Ass’n.,
` No. 13-958, 2013 WL 5569988 (E.D. Cal. Oct. 9, 2013) .................................................................... 25
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`Simulados Software, Ltd. v. Photon Infotech Private, Ltd.,
`40 F. Supp. 3d 1191 (N.D. Cal. 2014) ................................................................................................. 21
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`Spates v. Dameron Hosp. Ass’n,
`114 Cal. App. 4th 208 (2003) ........................................................................................................... 9, 10
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`Stavrinides v. Vin Di Bona,
`No. 18-314, 2018 WL 1311440 (C.D. Cal. Mar. 12, 2018) .................................................................. 24
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`Steckman v. Hart Brewing, Inc.,
`143 F.3d 1293 (9th Cir. 1998) .............................................................................................................. 25
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`Wilson v. Hewlett-Packard Co.,
`668 F.3d 1136 (9th Cir. 2012) .............................................................................................................. 14
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`Zeid v. Kimberley,
`930 F. Supp. 431 (N.D. Cal. 1996) ....................................................................................................... 14
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`Statutes
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`Cal. Civ. Code § 1668 ................................................................................................................................. 22
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`Cal. Penal Code § 496 ................................................................................................................. 8, 10, 11, 19
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`Consumers Legal Remedies Act, Cal. Civ. Code §§ 1750 et seq. ....................................................... passim
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`False Advertising Law, Cal. Bus. & Prof. Code §§ 17500 et seq. ....................................................... passim
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`Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200 et seq. ................................................... passim
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 9 of 34
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`INTRODUCTION
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`Like their initial Complaint, Plaintiffs’ First Amended Class Action Complaint (“FAC”) seeks to
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`hold Apple liable for the conduct of third-party scammers who allegedly convinced Plaintiffs to transfer
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`the funds stored on their Apple gift cards. But as this Court made clear in its earlier Order granting Apple’s
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`motion to dismiss (ECF No. 51, “Order”), California law does not impose liability on Apple for the criminal
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`acts of third-party scammers who obtained Plaintiffs’ funds after they purchased Apple gift cards. Nor
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`does it impose any duty on Apple to refund gift card funds stolen by thieves over whom Apple has no
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`control; to the contrary, and as the FTC and other government agencies have made clear, gift cards are like
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`cash, and consumers should not expect that they will receive a refund if a scammer obtains the card.
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`Plaintiffs’ efforts to plead around these basic principles are uniformly implausible.
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`Plaintiffs’ claim that Apple “aided and abetted” gift card scams is no more plausible than the one
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`this Court previously dismissed. As this Court made clear, it is not sufficient for Plaintiffs to allege that
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`Apple knew of gift card scams, that it processed payments to gift card scammers, or that it retained funds
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`that were associated with gift card scams. See Order at 12-18. Instead, Plaintiffs must allege that Apple
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`made a conscious decision to facilitate these scams and provided “substantial assistance” to the scammers.
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`Plaintiffs’ FAC contains no new factual allegations that satisfy either element. And while Plaintiffs claim
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`that Apple had a “direct stake” in the success of the gift card scams, any incidental economic benefit Apple
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`allegedly received from those scams does not constitute aiding and abetting as a matter of law.
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`Plaintiffs also claim that, by allegedly refusing to refund victims of third-party scams, Apple
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`“converted” the funds stolen from these victims and/or “received stolen property.” This theory of liability
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`is both legally meritless and factually unfounded. Plaintiffs’ conversion claim fails because Apple has
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`taken no affirmative act to deprive Plaintiffs of their funds. And Plaintiffs cannot state a claim for receiving
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`stolen property, which requires both that the funds be stolen at the time they allegedly came into Apple’s
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`possession and that Apple had “actual knowledge” of this fact.
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 10 of 34
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`Plaintiffs’ claims under the Unfair Competition Law (“UCL”), Consumers Legal Remedies Act
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`(“CLRA”), and False Advertising Law (“FAL”) fare no better. Although Plaintiffs claim that Apple
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`affirmatively misrepresented that the funds stolen by scammers had been “redeemed” and that there was
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`“nothing Apple could do” to help them, Plaintiffs have not plausibly alleged that these statements — which
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`Apple allegedly made after their funds had been stolen — are false or played any role in their decision to
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`purchase Apple gift cards. And while Plaintiffs claim that Apple “concealed” a laundry list of supposed
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`facts from them, this fraud-by-omission theory is equally implausible.
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`Plaintiffs cannot plausibly claim that Apple failed to disclose the risk of gift card scams. In addition
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`to publishing the “About Gift Card Scams” website, which provides information about gift card scams,
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`Apple printed the following warning — which Plaintiffs must have seen before providing their codes to a
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`scammer — on the back of each gift card in bold red font: “Do not share your code with anyone you do
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`not know.” And while Plaintiffs claim that Apple failed to disclose facts that would have led them to seek
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`a refund, those supposed omissions are not actionable: they played no role in Plaintiffs’ purchasing
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`decisions, and Plaintiffs cannot hold Apple liable for “deterring” them from seeking a refund to which they
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`were never entitled. Plaintiffs’ allegations of deception — as well as their tag-along claims for “unlawful”
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`and “unfair” conduct — do not come close to stating a plausible claim.
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`Finally, Plaintiffs’ allegation that Apple violated the UCL and CLRA by inserting an
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`“unconscionable” disclaimer of liability into its Terms & Conditions is meritless. Plaintiffs’ allegation that
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`scam victims buy Apple gift cards in a state of panic — which Apple has zero role in creating — does not
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`render the disclaimer either procedurally or substantively unconscionable. Moreover, the disclaimer does
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`not insulate Apple from liability for its own conduct; instead, it simply disclaims liability for losses or theft
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`caused by others (including scammers). Nothing about Apple’s disclaimer is unlawful or unfair; to the
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`contrary, it independently defeats Plaintiffs’ claims.
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`Plaintiffs’ FAC does not come close to curing the defects this Court identified in its previous Order.
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`None of Plaintiffs’ claims are viable, and all of them are barred by the disclaimer on the gift cards Plaintiffs
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 11 of 34
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`allegedly purchased. This Court should put an end to Plaintiffs’ misguided attempt to hold Apple liable
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`for the misconduct of third-party scammers, and it should dismiss this lawsuit without leave to amend.
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`I.
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`Apple’s Sale of Gift Cards.
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`BACKGROUND
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`Like many manufacturers, Apple sells gift cards that consumers can use to purchase its goods and
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`services, including apps, music, and other digital content. Those gift cards — which are available from a
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`wide variety of retailers throughout the United States — are made of plastic and are either attached to or
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`enclosed in a cardboard package. See RJN Ex. 1. At the time Plaintiffs purchased their gift cards, the back
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`of the packaging included a section titled “Terms and Conditions,” which stated, among other things, that
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`“[n]either Apple nor Issuer [i.e., Apple Value Services, LLC] is responsible for any loss or damage
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`resulting from lost or stolen gift cards or for use without permission.” Id. When a consumer removed the
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`gift card from the packaging, he or she would have seen a strip of foil, which hides a randomized and
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`unique code (“redemption code”) used to activate and redeem the funds on the card. See id. The back of
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`the card also stated, in bold red font: “Do not share your code with anyone you do not know.” Id.
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`As Plaintiffs note in their FAC, Apple gift cards “are not active until purchased,” at which point
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`“the retailer activates the card.” FAC ¶ 40. When the gift card is purchased, Apple receives money from
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`the purchaser, via the retailer, and the purchaser receives “stored value equal to the amount paid.” Id. ¶¶
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`39-40. The consumer uses that stored value by inputting the redemption code and PIN on the back of the
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`card into an Apple ID account, at which point the value on the card “is immediately available to make
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`purchases on iTunes, from the App Store or in apps.” Id. ¶ 41. Only after a consumer uses those funds to
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`purchase digital content does Apple distribute any money to the content seller.
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`II.
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`Plaintiffs’ Claims Against Apple.
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`This lawsuit involves a pattern of scams wherein third-party fraudsters contact victims under false
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`pretenses, demand payment in the form of Apple gift cards, obtain the redemption code from their victims,
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`and then either re-sell the redemption codes or transfer them to an Apple ID account controlled by a fellow
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`scammer. See generally FAC ¶¶ 63-71 (describing the alleged mechanics of this scam). As Plaintiffs
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`acknowledge, the scammers — not Apple — are responsible for contacting victims and obtaining their
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`funds. See, e.g., id. ¶ 65 (“If scammers successfully convince victims to purchase iTunes gift cards . . . .”)
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 12 of 34
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`(emphasis added). Nonetheless, Plaintiffs claim that Apple has an economic incentive to perpetuate this
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`scam and not to refund consumers who are victimized by third-party scammers.
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`To that end, Plaintiffs allege that Apple “engages in conduct that it hopes and believes — and
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`actually does — perpetuate gift card scams.” Id. ¶ 89. Plaintiffs challenge a litany of alleged acts and
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`omissions, which fall into five basic categories: (1) allegedly making affirmative misrepresentations about
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`its gift cards, gift card scams, and the extent of its ability to address those scams; (2) allegedly omitting or
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`concealing material facts about its gift cards, gift card scams, and the extent of its ability to address those
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`scams; (3) including an allegedly “unconscionable” disclaimer of liability on its gift cards and in its Terms
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`& Conditions; (4) “aiding and abetting” the scammers; and (5) allegedly refusing to issue refunds to victims
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`affected by scams. Plaintiffs allege that these practices are “designed to perpetuate the theft at issue . . .
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`and make it easier for Apple to keep the stolen funds for itself.” Id. ¶ 3.
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`Based on these allegations, Plaintiffs initially filed this lawsuit against Apple in July 2020. See
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`ECF No. 1 (“Compl.”). In their complaint, Plaintiffs asserted claims under the UCL, FAL, and CLRA, as
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`well as claims for breach of contract, “Money Had and Received/Unjust Enrichment/Restitution,” breach
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`of the implied covenant of good faith and fair dealing, aiding and abetting intentional torts, elder abuse,
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`and declaratory relief. See id. ¶¶ 132-222. Plaintiffs purported to assert these claims on behalf of
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`themselves, a nationwide class of consumers who “provided the redemption codes to people unknown to
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`them who sought the codes under false pretenses” and “were not refunded . . . by Apple,” a “contact
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`subclass” (consisting of putative class members who contacted Apple and did not receive a refund), and
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`an “elder subclass” (consisting of putative class members over the age of 65). See id. ¶¶ 116-18.
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`Apple moved to dismiss. See ECF No. 33. On March 4, 2021, this Court granted Apple’s motion
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`in its entirety. See ECF No. 51 (“Order”). In that Order, the Court concluded that Plaintiffs’ claims under
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`the UCL, FAL, and CLRA were defective because they “attempt[ed] to hold Apple liable for third-party
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`conduct,” did not establish that Apple provided “substantial assistance or encouragement” to the scammer,
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`and did not establish that Apple consciously participated in the alleged scams. Id. at 12-18. The Court
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`also dismissed Plaintiffs’ fraud-based claims, either because Plaintiffs failed to allege that they relied on
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`Apple’s misrepresentations or omissions in deciding to purchase their gift cards, that those omissions or
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`misrepresentations caused Plaintiffs’ alleged injuries, or that the information Apple omitted was
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`NOTICE OF MOTION AND MOTION TO DISMISS; MEMORANDUM OF POINTS & AUTHORITIES
`CASE NO. 5:20-CV-4812-EJD
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`Case 5:20-cv-04812-EJD Document 61 Filed 04/28/21 Page 13 of 34
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`inconsistent with its affirmative statements. See id. at 18-24. The Court concluded that Plaintiffs had not
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`plausibly alleged that Apple’s disclaimer was either procedurally or substantively unconscionable and
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`rejected Plaintiffs’ argument that the disclaimer relieved Apple of liability for its own alleged misconduct.
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`See id. at 24-27. The Court dismissed Plaintiffs’ quasi-contract claim, as well as their claim for breach of
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`the covenant of good faith and fair dealing, with prejudice. See id. at 27-32. It dismissed the remainder of
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`Plaintiffs’ claims — including their aiding-and-abetting claims, their UCL, FAL, and CLRA claims, their
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`elder abuse claim, and their claim for declaratory relief — with leave to amend. See id. at 39.
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`Plaintiffs — joined by two new Plaintiffs, Guanting Qiu and Andrew Hagene — filed their FAC
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`on April 14, 2021. See ECF No. 59. In their FAC, Plaintiffs no longer purport to represent an “elder
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`subclass,” and they no longer assert claims for quasi-contract, breach of contract, breach of the implied
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`covenant of good faith and fair dealing, and elder abuse. In lieu of those claims, Plaintiffs now assert that
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`Apple’s alleged refusal to provide refunds to victims of gift card scams amounts to conversion and receipt
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`of stolen property. See FAC ¶¶ 273-89. Plaintiffs continue to assert claims under the UCL, CLRA, and
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`FAL (see id. ¶¶ 197-272), as well as claims for aiding and abetting intentional torts and for declaratory
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`relief (see id. ¶¶ 290-302). As explained in more detail below, these claims are uniformly implausible and
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`do not remedy the defects this Court identified in its earlier Order.
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`“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as
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`ARGUMENT
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`true, to ‘state a claim for relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
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`(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Facts indicating the “mere possibility of
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`misconduct” fall short of meeting this plausibility standard. Iqbal, 556 U.S. at 679 (emphasis added).
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`Rather, the plaintiff must “allege more by way of factu