Amanda Sateriale v. R J Reynolds Tobacco Company
697 F.3d 777
9th Cir.2012Background
- RJR operated Camel Cash loyalty program 1991–2007; certificates (C-Notes) could be redeemed for catalog merchandise.
- Plaintiffs enrolled, saved C-Notes, and alleged RJR promised rewards in exchange for redemption per catalogs.
- RJR announced termination of Camel Cash in Oct 2006, with six-month redemption window through Mar 2007, but later claimed no merchandise was available.
- Plaintiffs filed a class action in Nov 2009 asserting breach of contract, promissory estoppel, UCL, and CLRA.
- District court dismissed UCL and CLRA claims; court denied dismissal of contract and promissory estoppel claims, then remanded for further proceedings.
- Plaintiffs seek damages and equitable relief for failure to honor C-Notes during the final period of the program.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there was an offer to form a contract (unilateral) | Holter argues C-Notes/catalogs created a unilateral offer. | RJR contends no enforceable offer or only invitations to negotiate. | There was an offer to enter a unilateral contract. |
| Whether the contract was definite enough to enforce | Plaintiffs contend terms were sufficiently definite despite RJR's discretion. | RJR argues essential terms were too uncertain. | Contract deemed sufficiently definite to survive dismissal. |
| Mutuality of obligation & RJR’s right to terminate | Even with termination right, a six-month window showed obligation to perform. | Unilateral contracts need not show mutuality; unrestricted termination could render illusory. | Mutuality not required for unilateral contract; record insufficient to bar contract claim. |
| Statute of limitations | Action should relate to 2007–2009 period; written contract statute applies. | Claim timing is improper or untimely. | Four-year statute applies; action timely within period. |
| UCL/CLRA viability based on misrepresentation | Misrepresentations ongoing and relied upon by plaintiffs. | Pre-Oct 2006 representations not alleged as false; reliance lacking for Oct 2006 announcement. | UCL and CLRA claims dismissed. |
Key Cases Cited
- Donovan v. RRL Corp., 27 P.3d 702 (Cal. 2001) (determines offer vs. invitation to negotiate; relevance to unilateral offers)
- Bustamante v. Intuit, Inc., 45 Cal. Rptr. 3d 692 (Cal. Ct. App. 2006) (certainty and remedies under contract formation)
- Cal. Lettuce Growers, Inc. v. Union Sugar Co., 289 P.2d 785 (Cal. 1955) (contract definiteness and permitting implied obligations)
- Asmus v. Pac. Bell, 999 P.2d 71 (Cal. 2000) (no mutuality required in unilateral contracts)
- In re Tobacco II Cases, 207 P.3d 20 (Cal. 2009) (actual reliance and causation in fraud/-UCL/CLRA claims)