Birch v. Family First Life, LLC

District Court, S.D. California·Decided December 14, 2023·No. 3:22-cv-00815·Unknown

Opinion

MICHAEL BORISH, individually and on Case No. 22-cv-815-MMA (SBC) behalf of all others similarly situated, et al., ORDER GRANTING MOTION TO DISMISS THIRD AMENDED Plaintiffs, COMPLAINT v. [Doc. No. 47] FAMILY FIRST LIFE, LLC, Defendant. Pending before the Court is Defendant Family First Life, LLC’s (“Defendant” or “FFL”) motion to dismiss Plaintiffs Michael Borish, Kevin Vega, and Ramon Fazah’s (“Plaintiffs”) Third Amended Complaint. Doc. No. 47. Plaintiffs filed an opposition, Doc. No. 50, to which Defendant replied, Doc. No. 52. The Court found this matter suitable for determination on the papers and without oral argument pursuant to Federal Rule of Civil Procedure 78(b) and Civil Local Rule 7.1.d.1. See Doc. No. 53. For the reasons set forth below, the Court GRANTS Defendant’s motion to dismiss without leave to amend. A. Procedural Background Plaintiffs initiated this action on June 3, 2022. Doc. No. 1. Thereafter, Plaintiffs amended their complaint twice: once as a matter of course, Doc. No. 3, and shortly after, a second time with leave of Court, Doc. No. 7 (Second Amended Complaint, the “SAC”). In its April 13, 2023 Order, the Court dismissed Plaintiffs’ SAC with leave to amend. Doc. No. 45. Notably, the Court held Plaintiffs did not allege facts to support personal jurisdiction over FFL in California. Id. at 9–15. The Court also held Plaintiffs did not plead any cause of action. Id. at 17–21. First, in response to FFL’s motion to dismiss, Plaintiffs conceded they did not state a claim as to two of their causes of action— violation of California Penal Code § 496 and of Florida Statute § 817.06—and they abandoned their two breach of contract causes of action. Id. at 17–18. Second, the Court held Plaintiffs did not plead fraud with particularity under Federal Rule of Civil Procedure 9(b), which applied to each of the causes of action at issue, because they relied on “vague,” “broad,” and generalized allegations that did not plead “with particularity a single specific advertisement or representation made by [FFL].” Id. at 20–21. The Court then granted Plaintiffs leave to amend because it had not previously “ruled on the pleading sufficiency of Plaintiffs’ claims.” Id. at 21 n.11. In response to the Court’s Order, Plaintiffs filed their Third Amended Complaint on May 4, 2023. Doc. No. 46 (Third Amended Complaint, the “TAC”). In that pleading, Plaintiffs replaced two of the original plaintiffs—Greg Birch and David Doehring—with Plaintiffs Vega and Fazah. TAC ¶¶ 6–7. However, Plaintiffs—on behalf of themselves and as representatives of all those similarly situated—assert the same claims for relief against Defendant as in their SAC, including: (1) Violation of California’s False 1 Reviewing Defendant’s motion to dismiss, the Court accepts as true all facts alleged in the TAC and construes them in the light most favorable to Plaintiffs. See Snyder & Assocs. Acquisitions LLC v. Advertising Law, Cal. Bus. & Prof. Code § 17500 et seq.; (2) Violation of California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200 et seq.; (3) Violation of California Penal Code § 496; (4) Violation of Texas’s Deceptive Trade Practices Act, Tex. Bus. & Com. Code § 17.46; (5) Violation of Florida’s Deceptive and Unfair Trade Practices Act, Fla. Stat. § 501.204; (6) Violation of Florida Statute § 817.06; (7) Breach of Written Contract; and (8) Breach of Oral Contract. See generally TAC. In the instant motion, Defendant again moves to dismiss Plaintiffs’ TAC in its entirety pursuant to Federal Rules of Civil Procedure 9(b), 12(b)(1), 12(b)(2), and 12(b)(6). Doc. No. 47 at 2. As stated above, Defendant’s motion to dismiss is fully briefed and ripe for decision. B. Factual Background This putative class action centers around the insurance industry and one of its common features: independent marketing organizations (“IMOs”). TAC ¶¶ 9–11. Defendant FFL is an IMO that distributes life insurance products to the public through a network of independent contractors known as “agents.” Id. ¶ 11. Plaintiffs allege they relied on false representations made by Defendant in purchasing low-quality insurance “leads” while working as agents for FFL. Id. ¶¶ 18, 41–43. As many of Plaintiffs’ allegations in the TAC remain unchanged, the Court incorporates by reference its background discussion from its April 13, 2023 Order. Doc. No. 45; see also Birch v. Fam. First Life, LLC, No. 22-CV-815-MMA (NLS), 2023 WL 2940020, at *1 (S.D. Cal. Apr. 13, 2023). Because, as detailed below, the Court is dismissing this action for lack of personal jurisdiction over Defendant, the Court only elaborates on facts relevant to that issue here. To that end, Plaintiffs allege in the TAC that Defendant “is a Connecticut limited liability company with its principal place of business” in Connecticut. TAC ¶ 8. However, Plaintiffs now allege that Defendant “maintains fourteen (14) offices within the state of California” and that “authorized representatives of [FFL] . . . as well as several FFL websites, made representations to California residents, that form the basis of the[ir] claims” in the TAC. Id. ¶¶ 2–3. Further, Plaintiffs allege that Defendant “has held and continues to hold several corporate events in California, which are intended to promote [Defendant]’s business and its leads to the public, which include California residents.” Id. ¶ 4. Plaintiffs “bear[] the burden” of establishing personal jurisdiction exists. In re Boon Global Ltd., 923 F.3d 643, 650 (9th Cir. 2019). “Where, as here, the defendant’s motion is based on written materials rather than an evidentiary hearing, ‘the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss.’” Ranza v. Nike, Inc., 793 F.3d 1059, 1068 (9th Cir. 2015) (quoting CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1073 (9th Cir. 2011)). The Court may consider declarations and other evidence outside the pleadings to determine whether it has personal jurisdiction. See Boon Global, 923 F.3d at 650. “[U]ncontroverted allegations in [Plaintiffs’] complaint must be taken as true,” but courts “may not assume the truth of allegations in a pleading which are controverted by affidavit.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011) (cleaned up). Any “factual disputes” must be “resolve[d] . . . in [Plaintiffs’] favor.” Id. When there is no applicable federal statute governing personal jurisdiction, as is the case here, the law of the forum state determines personal jurisdiction. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). California’s long arm statute is co-extensive with federal due process requirements, and therefore the jurisdictional analyses under California law and federal due process are the same. See Cal. Civ. Proc. Code §

Birch v. Family First Life, LLC, (S.D. Cal. 2023).

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