Max Gerboc v. ContextLogic, Inc.
867 F.3d 675
| 6th Cir. | 2017Background
- Plaintiff Max Gerboc purchased portable speakers on the Wish marketplace for $27 after seeing a crossed-out "$300" price on the product detail page; he alleges the crossed-out price created an illusory 90% discount.
- Gerboc sued ContextLogic (operator of Wish) in Ohio state court on behalf of a putative class, asserting breach of contract (abandoned), unjust enrichment, fraud, and violations of the Ohio Consumer Sales Practices Act (OCSPA).
- ContextLogic removed the case to federal court; the district court dismissed the unjust enrichment, fraud, and class OCSPA claims but allowed Gerboc’s individual OCSPA claim to proceed; the court certified the interlocutory appeal under 28 U.S.C. § 1292(b).
- On appeal, Gerboc seeks class relief based on alleged deceptive price comparisons; he contends the visuals promised a discount that never existed, entitling him to restitution or damages.
- ContextLogic argues Gerboc received the product he paid for (no loss), a contract (express or implied) governs the transaction, and Ohio law requires proof of actual damages and prior notice for class OCSPA claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether unjust enrichment claim survives where an express or implied contract exists | Gerboc: contract did not incorporate the advertised discount, so unjust enrichment is available to obtain restitution | ContextLogic: a contract (express or implied) governs the sale, barring quasi-contract relief; buyer received what he paid for | Dismissed — unjust enrichment unavailable because a contract covered the transaction and Gerboc suffered no unjust loss |
| Whether OCSPA class claim may proceed without prior Ohio notice of the deceptive practice | Gerboc: the crossed-out price violates OCSPA and supports class relief | ContextLogic: OCSPA class provision requires prior state notice or court determination of similar deceptive practice; none exists for online crossed-out prices | Dismissed — no adequate prior notice under § 1345.09(B); Ohio precedent does not clearly brand such online visuals deceptive |
| Whether Gerboc alleged "actual damages" required for OCSPA class relief | Gerboc: loss arises from the failure to provide the promised discount; restitution suffices | ContextLogic: Gerboc paid the advertised $27 and received value; Ohio requires actual, compensable loss for class damages | Dismissed — plaintiff failed to allege actual damages (no economic loss shown) |
| Whether the fraud claim survives | Gerboc: fraud alleged based on deceptive pricing visuals | ContextLogic: (implicitly) no actionable misrepresentation causing loss | Dismissed/waived — plaintiff presented perfunctory briefing on fraud, waiving the argument |
Key Cases Cited
- Wuliger v. Mfrs. Life Ins. Co., 567 F.3d 787 (6th Cir. 2009) (defines unjust enrichment and limits quasi-contract relief when a contract exists)
- Hambleton v. R.G. Barry Corp., 465 N.E.2d 1298 (Ohio 1984) (elements required to establish unjust enrichment/recovery)
- Stepp v. Freeman, 694 N.E.2d 510 (Ohio Ct. App. 1997) (requirements for finding an implied-in-fact contract)
- Felix v. Ganley Chevrolet, Inc., 49 N.E.3d 1224 (Ohio 2015) (OCSPA actual damages requirement and class-action prerequisites)
- In re Omnicare, Inc. Sec. Litig., 769 F.3d 455 (6th Cir. 2014) (standard of review for motions to dismiss)
- Standard Fire Ins. Co. v. Knowles, 568 U.S. 588 (U.S. 2013) (Class Action Fairness Act jurisdiction principles)
- Martin v. Lamrite W., Inc., 41 N.E.3d 850 (Ohio Ct. App. 2015) (rejection under Ohio law of similar discount-based restitution theory)
- Hinojos v. Kohl’s Corp., 718 F.3d 1098 (9th Cir. 2013) (contrasting approach on damages/injury in deceptive pricing cases under California law)