Ride the Ducks Seattle LLC v. Ride the Ducks International
20-35854
| 9th Cir. | Jan 14, 2022Background:
- Ride the Ducks Seattle (Seattle) bought amphibious "duck boats" from Ride the Ducks International (International); a deadly crash in Sept. 2015 prompted the parties to wind down their relationship.
- In 2018 the parties executed a Waiver Agreement stating they "waive and release all rights and claims against each other to be protected, defended, indemnified, and held harmless from any and all claims... arising from or relating in any way to the accident on September 24, 2015."
- Despite the Waiver, Seattle sued International (and others) under the Washington Consumer Protection Act (CPA); International removed, counterclaimed against Seattle, and the case was consolidated with a separate action involving Seattle’s CEO, Brian Tracey.
- The district court granted summary judgment on two alternative grounds: (1) the Waiver Agreement released all claims arising from the crash; and (2) Seattle’s alleged deceptive acts lacked the capacity to deceive a substantial portion of the public and failed the public-interest CPA element.
- The Ninth Circuit held the Waiver did not bar Seattle’s and International’s independent CPA claims (business/property harm and reputational economic loss are distinct from indemnity claims), and ruled the district court erred by granting summary judgment sua sponte on the capacity-to-deceive and public-interest elements without notice or factual development; it also found no jurisdiction to consider International’s cross-appeal as to Tracey.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of Waiver Agreement — does it bar CPA and related claims arising from the crash? | Seattle: Waiver does not bar Seattle’s CPA claim for business/property and economic harms tied to reputational injury. | International: Waiver releases all claims arising from or relating to the crash, insulating both sides. | Waiver language not broad enough to bar independent claims for business/property harm or reputational economic loss; those are distinct from indemnity claims. |
| Capacity-to-deceive element of CPA — can alleged acts deceive a substantial portion of the public? | Seattle: The record and briefing were not developed; capacity could exist. | International: Alleged conduct lacked capacity to deceive a substantial portion of the public. | District court erred to grant summary judgment sua sponte on this legal question without notice and opportunity to respond. |
| Public-interest element of CPA — did the conduct affect the public interest? | Seattle: Alleged violations of the Washington Auto Dealer Practices Act establish public interest per se. | International: Conduct did not sufficiently affect the public interest. | Public-interest is a factual question; district court erred by resolving it on summary judgment without record development or considering per se statutory effects. |
| Appealability re: Tracey — may Ninth Circuit review dismissal of International’s CPA claim against Tracey? | International: (by cross-appeal) sought review of dismissal. | Tracey/Seattle: Notice of cross-appeal failed to identify Tracey or the order; prejudice from addressing issues without proper notice. | Court lacks jurisdiction to consider International’s cross-appeal as to Tracey because the notice of cross-appeal did not satisfy Rule 3 requirements. |
Key Cases Cited
- Central Wash. Refrigeration, Inc. v. Barbee, 946 P.2d 760 (Wash. 1997) (indemnity actions are distinct from the underlying wrong)
- Young v. Toyota Motor Sales, U.S.A., 472 P.3d 990 (Wash. 2020) (CPA requires conduct capable of deceiving a substantial portion of the public)
- State v. LA Inv’rs, LLC, 410 P.3d 1183 (Wash. Ct. App. 2018) (capacity-to-deceive can be a question of law)
- Hangman Ridge Training Stables, Inc. v. Safeco Title Ins., 719 P.2d 531 (Wash. 1986) (public-interest element of CPA is a factual inquiry)
- Sherwood v. Bellevue Dodge, Inc., 669 P.2d 1258 (Wash. Ct. App. 1983) (violations of the Motor Dealer Practices Act affect the public interest per se)
- Le v. Astrue, 558 F.3d 1019 (9th Cir. 2009) (functional approach to interpreting notices of appeal)
- Torres v. Oakland Scavenger Co., 487 U.S. 312 (1988) (Rule 3's notice requirements are jurisdictional)