ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS FIRST AMENDED COMPLAINT
Dеfendants Best Buy Co. Inc. (“Best Buy”) and Toshiba America Information Systems, Inc. (“Toshiba”) (collectively “Defendants”) move to dismiss Plaintiffs complaint under Federal Rules of Civil Procedure (“Rules”) 9(b) and 12(b)(6). This case is a putative consumer class action alleging violations of the California Consumers Legal Remedies Act (“CLRA”), Cal. Civ. Code § 1770(a)(5), (a)(7), (a)(9), and the California Unfair Competition Law (“UCL”), Cal. Bus. & Prof.Code § 17200 et seq. Plaintiff argues that Defendants affirmatively misrepresented the battery life on his Toshiba Satellite L505 laptop (the “Laptop”) as “up to 3.32 hours” even though this battery life “could never be achieved when the [Laptop] was used in normal, practical, and realistic circumstances,” and that Defendants concealed or failеd to disclose that the battery life testing parameters Defendants employed “bear no rational or reasonable relationship to an average consumer’s expected use of [the] Laptop.” (Opp’n to Mot. to Dismiss (“Opp’n”) ECF No. 11, 1:16-17, 4:14-15.) Defendants argue that Plaintiff fails to allege any fraudulent affirmative misrepresentations, fraudulent omissions, unlawful or unfair conduct, or that Toshiba participated in and controlled Best Buy’s representations concerning the Laptop. (Mot. to Dismiss (“Mot.”) ECF No. 7, 4:18-14:12.) Plaintiff opposes the motion.
I. FACTUAL ALLEGATIONS
Plaintiff alleges the following in his First Amended Class Action Complaint (“FAC”). On December 15, 2009, after looking at the product tags for various laptops, Plaintiff purchased a Toshiba Satellite L505 Laptop from a Best Buy retail store in Folsom, California. (FAC ¶ 9 & Ex. A.) Best Buy displays its laptops with a “ ‘product tag,’ which contains the price and a brief description of the features of the laptop.” (FAC ¶ 43.) “One prominent feature is ‘Battery.’ ” (Id. ¶ 43.) “Best Buy represented Plaintiffs Laptop battery life to be ‘up to 3.32 hours.’ ” (Id. ¶ 44.) Best Buy did not provide “any explanation as to how the ‘up to’ hours was calculated or determined on the product tag or elsewhere” in the store, and “there was no disclaimer, qualifier, or other language.” (Id. ¶¶ 45, 12.)
Plaintiff “decided to purchase the Toshiba Satellite L505 [Laptop] based substantially on his reliance on the representation that the battery life for that model wаs ‘up to 3.32 hours.’ ” (Id. ¶ 11.) “Plaintiff ... believed that the represented battery life of ‘up to 3.32 hours’ was reflective of how long Plaintiff could expect his Laptop to operate when being powered solely by its
Toshiba uses the MobileMark 2007 (“MM07”) benchmark test to measure the battery life of its Toshiba L505 Laptops. (Id. ¶¶ 24, 35.) During the test, the computer’s monitor is set to 60 nits, or “the brightness of 20% to 30% of [the] normal level.” (Id. ¶ 26.) Meanwhile, “the computer’s Wi-Fi, Bluetooth, and other wireless functions are disabled so the computer is not drawing power from the battery to perform these functions,” and the computer’s “main processor chip is set to 5% to 7.5% of its normal capacity” so that it “is essentially running in an idle state.” (Id. ¶¶ 27, 28.) Three separate performance tests are then administered: (1) a DVD test where “a DVD movie is played until the battery dies,” (2) a productivity test where the computer' “perform[s] common office activities” such as data processing, and (3) a reading test where the computer “read[s] a PDF document pausing [for] two minutes on each page.” (Id. ¶ 29(a)-(c).) “MM07 does not provide an ‘overall’ rating; rather, the computer is given three scores, one for each category (DVD, Productivity, and Reader). The laptop manufacturer or retailer may choose which score to report to consumers.” (Id. ¶ 30.)
“Toshiba conveys the results of the Laptop’s MM07” test to “third party retailers, such as Best Buy ... with the intention and desire that these third party retailers will, in turn, represent to consumers these results.” (Id. ¶ 36.) Since MM07 testing bears “no resemblance to the real-life and everyday uses of laptop computers and notebooks,” the Laptop’s “actual battery life [i]s substantially less than that which was represented by Defendants.” (Id. n 31, 3.)
On its website, Best Buy describes its computers’ specifications, including their battery lives. (Id. ¶¶ 46^18.) “[E]ach [L]aptop’s battery life is represented as being ‘up to’ a specified number of hours.” (Id. ¶ 46.) Customers can click on this battery life representation to display a pop-up box. (Id. ¶ 47.) The pop-up box states:
Battery Life
Battery life tested using MobileMark 2007. Battery life will vary depending on the product configuration, product model, applications loaded on the product, power management setting of the product, and the product features used by the customer. As with all batteries, the maximum capacity of this battery will decrease with time and usage.
(Id. ¶ 47.) “Other than the statement that the Laptop’s battery life was tested using MobileMark 2007 ... there is not any explanation [on the website] as to how the ‘up to’ hours was calculated or any other information.” (Id. ¶ 48.)
“Plaintiff paid more for his Laptop than he would have paid had the material fact not been concealed or omitted that the battery life for his Laptop was calculated with: (i) its screen set to 60 nits; (ii) its Wi-Fi, Bluetooth, and other wireless functions disabled; and (iii) its main processor chip set to 5% to 7.5% of its normal capacity.” (MU 15.)
II. LEGAL STANDARD
Decision on a Rule 12(b)(6) dismissal motion requires determination of “whether the complaint’s factual allegations, together with all reasonable inferences, state a plausible claim for relief.” Cafasso, United States ex rel. v. Gen. Dynamics C4 Sys., Inc.,
When determining the sufficiency of a claim under Rule 12(b)(6), “[w]e accept factual allegatiоns in the complaint as true and construe the pleadings in the light most favorable to the non-moving party.” Fayer v. Vaughn,
III. DISCUSSION
A. Toshiba’s Participation and Control Over Best Buy’s Representations
1. UCL
Plaintiff alleges Defendants violated the UCL by engaging in an “unlawful, unfair or fraudulent business act or practice.” Cal. Bus. & Prof.Code § 17200. “Because [the UCL] is written in the disjunctive, it establishes three varieties of unfair competition' — -acts or practices which are unlawful, or unfair, or fraudulent. An act can be alleged to violate any or all of the three prongs of the UCL' — • unlawful, unfair, or fraudulent.” Berryman v. Merit Prop. Mgm’t, Inc.,
Plaintiff counters that it has “sufficiently established] Toshiba’s participation in the creation of [Best Buy’s] product tags” since the information on the product tags “was provided directly by, and therefore
“A defendant’s liability [under the UCL] must be based on his personal ‘participation in the unlawful practices’ and ‘unbridled control’ over the practices.” Emery v. Visa Int’l Serv. Ass’n,
2. CLRA
Plaintiff alleges Defendants violated the following quoted provisions of the CLRA: “Representing that goods.or services have ... characteristics ... which they do not have,” Cal. Civ. Code § 1770(a)(5); “Representing that goods or services are of a particular standard, quality, or grade, ... if they are of another,” id. § 1770(a)(7); and “[advertising goods or services with intent not to sell them as advertised.” Id. § 1770(a)(9). These provisions of the CLRA proscribe both fraudulent omissions and fraudulent affirmative misrepresentations. Outboard Marine Corp. v. Superior Court,
Toshiba seeks dismissal of Plaintiffs CLRA claims against it, arguing that “[t]o impose ... CLRA liability against [it], plaintiff must [likewise] allege with particularity facts demonstrating [Toshiba’s] ‘personal participation in the unlawful practices and unbridled control over the practices.’ ” (Mot. 13:5-7 (quoting Perfect 10,
1. Rule 9(b)
Plaintiffs CLRA claims and UCL fraud claim must satisfy Rule 9(b)’s heightened pleading standards since Plaintiffs allegations involve fraudulent conduct. It is well settled that а federal court examines state claims to determine whether the elements of fraud have been pled with Federal Rule of Civil Procedure 9(b)’s required specificity, irrespective of whether state law is the substantive law at issue. Kearns v. Ford Motor Co.,
Defendants argue “[P]laintiff has not satisfied the requirements of Rule 8, let alone the heightened requirements of Rule 9(b).” (Mot. 10:13-14.) Plaintiff rejoins that the FAC “satisfies the pleading requirements of [Rule] 9(b)” by recounting the who, what, when, where, and how of the alleged misconduct, (Opp’n 6:13, 7:3-8:27), and since the FAC’s allegations are “strikingly similar” to the allegations found to satisfy Rule 9(b) in Kowalsky v. Hewlett-Packard Company. (Opp’n 7:1 (citing
Plaintiff alleges in the FAC that Toshiba “reported] the Laptops’ battery life to third party retailers using the results from the Laptops’ MM07 testing with the intention and desire that these third party retailers [ ] convey to consumers the Laptop’s alleged battery life, while failing to disclose that the represented battery life was derived” with the Laptop’s monitor set to “the brightness of 20% to 30% of [the] normal level,” the “Wi-Fi, Bluetooth, and other wireless functions [ ] disabled,” and the “main processor chip [ ] set to 5% to 7.5% of its normal capacity.” (FAC ¶¶ 66, 26.) With respect to Best Buy, Plaintiff alleges that “Best Buy reрresented Plaintiffs Laptop battery life to be ‘up to 3.32 hours’ ” without providing “any explanation as to how the ‘up to’ hours was calculated or determined,” and despite the fact that this battery life was obtained with the Laptop’s monitor set to “the brightness of 20% to 30% of [the] normal level,” the “Wi-Fi, Bluetooth, and other wireless functions [ ] disabled,” and the “main processor chip [] set to 5% to 7.5% of its normal capacity.” (FAC ¶¶44, 45, 26.) These allegations are “sufficiently] detailed] ... to give us some assurance that [Plaintiffs] theory has a basis in fact.” Berson v. Applied Signal Tech., Inc.,
Defendants seek dismissal of Plaintiffs affirmative misrepresentation claims alleged under the UCL and CLRA. Defendants argue, based on the Ninth Circuit’s unpublished disposition in Maloney v. Verizon Internet Services, Inc., Plaintiff could not have been reasonably deceived by the Laptop’s product tag, which stated the Laptops have a battery life of “up to 3.32 hours.” (Mot. 4:26-5:2.) In Maloney, defendants “stated thаt a subscriber [to its Internet service] would receive Internet service at a speed ‘up to 3 Mbps.’ ” Maloney,
Plaintiff distinguishes Maloney, arguing that both the district court and the Ninth Circuit decisions in Maloney relied not only on the “up to 3.0 Mbps” representation, but also on the fact that Maloney, unlike Plaintiff, “received clear notice from the Terms of Service (which she admitted reading prior to purchase [and which she was required to read prior to receiving service]) that ... her circumstances [including her maximum line rate could] preclude her from receiving the represented maximum internet speed.” (Opp’n 11:14— 18.) Plaintiff argues Maloney is inapplicable since the “up to” language there was accompanied and “reinforced by the [Terms of Service] to which a customer would have to agree before receiving internet service,” Maloney v. Verizon Internet Services, Inc., No. ED CV 08-1885-SGL(AGRx),
Plaintiff also argues that “the California Court of Appeals [ ] rejected the very ‘up to’ argument Defendants advance here” in Consumer Advocates v. Echostar Satellite Corporation. (Opp’n 9:26-27 (citing
Under the UCL, “[a] ‘reasonable consumer’ standard applies when determining whether a given claim is misleading or deceptive.” Colgan v. Leatherman Tool Grp.,
The same reasonable consumer standards applicable to Plaintiffs UCL claim apply to his CLRA claim. See Klein,
In this case, Plaintiff believed that the battery life listed on the Laptop was stated in a manner that conveyed that it “was reflective of how long Plaintiff could expect his Laptop to operate.” (FAC ¶ 12). Defendants counter that this belief was “unreasonable as a matter of law” since a reasonable consumer would not be deceived by a representation containing the phrase “up to.” (Mot. 5:16-20.) However, multiple courts have found that “up to” representations may materially mislead reasonable consumers. See, e.g., Bruno v. Quten Research Inst., LLC,
Here, Defendants have not shown that Plaintiffs alleged belief was unreasonable as a matter of law or was “predicated on a strained and unjustified interpretation” of the product tag statement or battery representations. O’Shea v. Epson Am., Inc., No. CV 09-8063 PSG (Cwx),
3. Fraudulent Omissions
Defendants seek dismissal of Plaintiffs fraudulent omission claims alleged under the UCL and CLRA, arguing that the allegedly omitted information was neither material, contrary to Defendants’ battery life representation, nor subject to a duty to disclose. (Mot. 7:2-11:15.) Plaintiff does not contend that the allegedly omitted information was contrary to the “up to 3.32 hours” representation, but rather argues that the omitted information was material and that Defendants were subject to a duty to disclose. (Opp’n 13:25-19:19.)
i. Materiality
Defendants dispute the materiality of the omitted battery testing information, arguing that it is not material since “members of the public [do not] hold expectations about the ‘nit’ levels, wireless functions, processor chip capacity, or PDF read-rate used to calculate a maximum potential battery life.” (Mot. 8:23-25.) Plaintiff counters that the omitted information is material since “the battery life of laptops and notebooks is one of the primary factors consumers consider when determining which laptop to purchase,”
In California, a misrepresentation is material “if ‘a reasonable man would attach importance to its existence or nonexistence in determining his choice of action.’ ” Kwikset Corp. v. Superior Court,
Plaintiff alleges that he was “induced to purchase the Laptop[]” and “paid more for his Laptop than he would have paid” otherwise due to Best Buy’s unqualified statement that the Laptop had a battery life of “up to 3.32 hours.” (FAC ¶ 4, 11, 15.) Plaintiff further alleges:
Portability is one of the key features for consumers purchasing a laptop or notebook computer, as consumers often take their laptops and notebooks to locations without еlectrical outlets, such as coffee shops, college classes, airplanes, commuter trains, and public parks.
When a consumer uses a laptop computer or notebook without an electrical outlet power source, the computer uses the electrical power from the laptop’s built-in computer battery. Accordingly, the battery life of laptops and notebooks is one of the primary factors consumers consider when determining which laptop to purchase.
(FAC ¶¶ 21, 22.) Given these allegations, Defendants have not shown that Plaintiff did not reasonably “ ‘attach importance to [the] existence [of the battery life representations] in determining his сhoice of action.’ ” Kwikset Corp.,
ii. Duty to Disclose
The parties argue that “[u]nder California law, there are four circumstances in which an obligation to disclose may arise: ‘(1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts.’ ” Smith v. Ford Motor Co.,
(a) Exclusive Knowledge
Dеfendants argue that Plaintiff cannot successfully allege Defendants’ exclusive knowledge since Plaintiff admits in the FAC that Best Buy’s website disclosed the use of MM07 testing and that Newsweek published an article publicly criticizing the MM07 test for the same reasons raised here by Plaintiff. (Mot. 10:5-11 (citing FAC ¶¶ 31-33).) Plaintiff responds that Defendants had exclusive knowledge of the MM07 DVD, Productivity, and Reader test results since the “results of the[se] tests are [still] not available in the public domain,” and this exclusive and “superior” knowledge gave rise to Defendants’ duty to disclose. (Opp’n 17:7-8.) Defendants counter that Plaintiff cannot establish their exclusive knowledge based on a theory “that is never pled in the FAC.” (Reply 8:3.) Specifically, Defendants argue that the FAC concerns disclоsure of the MM07 test conditions, but Plaintiff now improperly attempts to establish Defendants’ duty to disclose based on Defendants’ exclusive knowledge of the test results. (Reply 8:2-3.)
A defendant has exclusive knowledge giving rise to a duty to disclose when “according to the complaint, [defendant] knew of this defect while plaintiffs did not, and, given the nature of the defect, it was difficult to discover.” Collins v. eMachines, Inc.,
Here, Plaintiff could have readily recognized any deficiencies in his Laptop’s battery life, and “Plaintiffi ] purchased [his Laptop] more than [nine months] after information [criticizing MM07] was disseminated.” Gray v. Toyota Motor Sales, U.S.A., No. CV-08-1690 PSG (Jcx),
Nor can Defendants’ concealment of the DVD, Reader, and Productivity test results give rise to a duty to disclose, since Plaintiff does not allege that he was misled by Defendants’ failure to disclose these test results. Rather, Plaintiff consistently
(b) Active Concealment
Defendants argue Plaintiffs “bare assertion” that Toshiba and Best Buy “actively concealed material facts from Plaintiff and the CLRA Subclass” is insufficient to state an active concealment duty to disclose. (Mot. 10:26.) Plaintiff responds that he “has pled sufficient facts to allege active concealment” by alleging that “ ‘the results of all three tests (DVD, Productivity, and Reading)’ ” have not been published. (Opp’n 18:5-6, 17:27-28 (quoting FAC ¶ 34).) Defendаnts respond that Plaintiff cannot predicate a duty to disclose on concealment of the test results, since Plaintiff “does not allege [that] in the FAC.” (Reply 9:3.) Defendants also retort that it is “nonsense” to “suggest that facts that were publicly disclosed in Newsweek and on [Defendants’ websites were ‘actively concealed.’ ” (Reply 8:25-9:1.)
Mere nondisclosure does not constitute active concealment. See, e.g., Gray,
Here, Plaintiffs only active concealment allegation is the conclusory assertion that Defendants “actively concealed material facts from Plaintiff and the Class.” (FAC ¶¶ 41, 52.) This active concealment “allegation[ is] deficient [since Plaintiff] fails to allege any specific facts demonstrating that ... [Defendants] actively tried to conceal the existence of the [MM07 testing or test conditions].” Gerawan Farming, Inc. v. Rehrig Pac. Co., 1:11-CV-01273 LJO BAM,
(c) Partial Representation
Toshiba argues that “Plaintiff has not alleged particularized facts supporting ... a duty to disclose” by Toshiba based on a partial representation theory. (Mot. 8:14-15.) Since Plaintiff does not allege any representations made by Toshiba to Plaintiff, this portion of Toshiba’s dismissal motion is granted. Accordingly, since Plaintiff fails to plead a duty to disclose by Toshiba under any theory, Plaintiffs CLRA fraudulent omission claim against Toshiba is dismissed.
Best Buy also contends that Plaintiff “has not pled a partial representation related to the allegedly omitted test conditions” since Plaintiff “does not allege that [Best Buy] made any specific representations regarding battery test conditions.” (Mot. 11:10-12.) Plaintiff rejoins that, given the MM07 testing conditions, “representing the maximum battery life [of the Laptops as ‘up to 3.32 hours’] was deceitful and misleading” and gave rise to a partial representation duty to disclose. (Opp’n 18:19-20.)
Here, Best Buy’s product tag listed the Laptop’s battery life as “up to 3.32 hours.” (FAC ¶ 44.) The product tag did not provide “any explanation as to how the ‘up to’ hours was calculated or determined,” and “there was no disclaimer, qualifier, or other language.” (Id. ¶¶ 45, 12.) Given Plaintiff’s allegation that a reasonable consumer could not expect to experience this battery life, (id. ¶ 58d), or “even close” to this battery life, (id. ¶ 14), Plaintiff has pled a duty to disclose based on partial representation. See generally In re Apple In-App Purchase Litig.,
C. Best Buy’s Unlawful or Unfair Acts or Practices
In addition to his UCL fraud claim, Plaintiff also alleges that Best Buy violated the unlawful and unfair prongs of the UCL. (FAC ¶¶94, 95.) Under the UCL’s “unlawful” prong, violations of other laws are “borrowed” and made independently actionable under the UCL. Cel-Tech Commc’ns, Inc. v. L.A. Cellular Tel. Co.,
Under the UCL’s “unfair” prong, the test for liability in consumer suits is “in flux.” Lozano v. AT & T Wireless Servs., Inc.,
The applicable test need not be decided here since Plaintiff fails to plead а claim under either standard. Under the South Bay Chevrolet balancing test, Plaintiff has not shown that “the gravity of the harm” he alleges outweighs “the utility of the [Defendant's conduct.”
IV. CONCLUSION
For the reasons stated, Plaintiffs unlawful, unfair, and fraudulent UCL claims against Toshiba and his fraudulent omission CLRA claim against Toshiba are dismissed. Plaintiffs unfair UCL claim against Best Buy and his fraudulent omission CLRA claim against Best Buy based on Best Buy’s exclusive knowledge and active concealment are dismissed. The remainder of the dismissal motion is denied. Plaintiff is granted fifteen (15) days leave from the date on which this Order is filed to file an amended complaint amending the dismissed claims.
Notes
. Toshiba also argues that whereas Best Buy’s product tag merely lists the Laptop’s battery life as “up to 3.32 hours/’ Toshiba’s website provides numerous disclosures concerning the Laptop’s battery life and MM07 testing. (Reply, ECF No. 13, 11:27-12:4.) Toshiba requests judicial notice of the Toshiba web-page providing these disclosures and describing the Toshiba Satellite L505 Laptop. (Defs/ Req. for Judicial Not., ECF No. 12, Ex. A.) However, Toshiba does not allege that the webpage printout provided reflects the contents of Toshiba’s webpage during the applicable proposed class period. Accordingly, Toshiba’s request for judicial notice of the webpage is denied. See Bingham v. Holder,
. The California Courts of Appeal are split on whether these factors — which are outlined in Judkins, a fraudulent concealment case-— properly apply to UCL and CLRA omission claims. Compare Collins v. eMachines, Inc., 202 Cal.App.4th 249, 255-56,