1 2 3 4 5 6 7 10 11 SARAH BLAIN, individually and on Case No.: 22-cv-00970-AJB-DEB behalf of all others similarly situated, 12 ORDER GRANTING DEFENDANT’S 13 Plaintiff, PARTIAL MOTION TO DISMISS PLAINTIFF’S FIRST AMENDED 14 v. COMPLAINT COMPANY, (Doc. No. 34) 16 Defendant. 17 18 Presently pending before the Court is Defendant Liberty Mutual Fire Insurance 19 Company’s (“Liberty Mutual”) motion to dismiss Plaintiff Sarah Blain’s claim for 20 violation of the California Unfair Competition Law (“UCL”) in Plaintiff’s First Amended 21 Complaint (“FAC”) pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 34.) 22 Plaintiff filed an opposition to the motion to dismiss (Doc. No. 36), to which Liberty 23 Mutual replied, (Doc. No. 37). Pursuant to Civil Local Rule 7.1.d.1, the Court finds the 24 instant matter suitable for determination on the papers and without oral argument. 25 Accordingly, the Court hereby VACATES the hearing currently set for July 13, 2023, at 26 2:00 p.m. For the reasons stated herein, the Court GRANTS the motion to dismiss 27 Plaintiff’s UCL claim. 28 /// 2 The Court previously outlined Plaintiff’s allegations in its Order Granting in Part 3 Liberty Mutual’s Motion to Dismiss Plaintiff’s original Complaint. (Doc. No. 27 at 2.) In 4 short, Plaintiff’s claim begins with the California “stay-at-home” orders that were 5 implemented in March 2020 as a response to the COVID-19 pandemic. (Id. at 5.) These 6 measures resulted in reduced driving across the state and respectively lowered the number 7 of claims likely to be paid by automobile insurance providers, such as Liberty Mutual. (Id.) 8 In April 2020, Liberty Mutual announced its intention to issue a 15% refund to all auto 9 insurance policyholders for two months’ worth of premiums. (Id. at 4.) Then, from June 10 2020 through May 2021, Liberty Mutual continued to issue a 5% refund to its 11 policyholders. (Id. at 9.) The gravamen of Plaintiff’s complaint is that the initial refunds of 12 15% and the subsequent refunds of 5% were inadequate and resulted in Liberty Mutual 13 enjoying an unfair windfall at the expense of its policyholders. (Id.) 14 Plaintiff’s FAC asserts two claims against Liberty Mutual: (1) breach of contract 15 under the implied covenant of good faith and fair dealing; and (2) violation of the UCL 16 under its unfairness prong. (FAC, Doc. No. 31.) Liberty Mutual filed the instant motion to 17 dismiss Plaintiff’s UCL claim under Federal Rule of Civil Procedure 12(b)(6), asserting 18 that Plaintiff failed to establish a lack of adequate legal remedies. (Doc. No. 34 at 2.) 20 A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the pleadings 21 and allows a court to dismiss a complaint upon a finding that the plaintiff has failed to state 22 a claim upon which relief may be granted. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 23 2001). The court may dismiss a complaint as a matter of law for: “(1) lack of cognizable 24 legal theory or (2) insufficient facts under a cognizable legal claim.” SmileCare Dental 25 Grp. v. Delta Dental Plan of Cal., 88 F.3d 780, 783 (9th Cir. 1996) (citation omitted). 26
27 1 The facts incorporated herein are taken from Plaintiff’s FAC and are construed as true for the limited 28 1 However, a complaint survives a motion to dismiss if it contains “enough facts to state a 2 claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 3 (2007). 4 Notwithstanding this deference, the reviewing court need not accept legal 5 conclusions as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is also improper for the 6 court to assume “the [plaintiff] can prove facts that [he or she] has not alleged . . . .” 7 Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 8 519, 526 (1983). On the other hand, “[w]hen there are well-pleaded factual allegations, a 9 court should assume their veracity and then determine whether they plausibly give rise to 10 an entitlement to relief.” Iqbal, 556 U.S. at 679. The court only reviews the contents of the 11 complaint, accepting all factual allegations as true, and drawing all reasonable inferences 12 in favor of the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002). 14 Liberty Mutual moves to dismiss Plaintiff’s UCL claim for Plaintiff’s failure to 15 allege a lack of adequate legal remedies which, under Sonner v. Premier Nutrition Corp., 16 971 F.3d 834 (9th Cir. 2020), is a prerequisite to the pursuit of an equitable claim. (Doc. 17 No. 36 at 2.) 18 Plaintiff asserts Liberty Mutual violated the unfair prong of the UCL because it failed 19 to refund premiums at an adequate rate of 30%, knowingly retained excessive profits, did 20 not conduct accurate risk assessments, and failed to disclose that it was earning excessive 21 profits, or the amount of those profits. (FAC ¶ 68.) In the FAC, Plaintiff 22 23 requests that this Court grant the relief requested under the UCL in the event that Plaintiff’s claims seeking legal remedies are revealed to be inadequate to 24 provide a complete and adequate remedy for the harms described herein. 25 Otherwise, Plaintiff and the members of the putative class may be irreparably harmed and/or denied an effective and complete remedy. 26
27 (Id. ¶ 76.) Liberty Mutual requests the Court to dismiss Plaintiff’s UCL claim because 28 “Plaintiff has not alleged any facts, except for her conditional and speculative statements 1 that she pleads her UCL claim in the alternative” and does not demonstrate a lack of 2 adequate legal remedy. (Doc. No. 34 at 10.) Plaintiff responds that even after Sonner, UCL 3 claims may be plead as an alternative remedy. (Doc. No. 36 at 9.) 4 In Sonner, the Ninth Circuit held “that the traditional principles governing equitable 5 remedies in federal courts, including the requisite inadequacy of legal remedies, apply 6 when a party requests restitution under the UCL . . . .” 971 F.3d at 844 (emphasis added). 7 There, the plaintiff dropped her claims for damages shortly before trial. Because the 8 plaintiff failed to allege an adequate legal remedy in her complaint and conceded her claim 9 for restitution was equal to the amount sought as damages, the court determined that the 10 plaintiff failed to state a claim for relief. Specifically, the court said “Sonner fails to explain 11 how the same amount of money for the exact same harm is inadequate . . . .” Id. at 844. 12 Plaintiff invites the Court to consider the recent post-Sonner holding of Carroll v. 13 Progressive Cas. Ins. Co., 2:21-cv-09217-FMO-RAO, Dkt. No. 94 (C.D. Cal. Mar. 6, 14 2023), where the motion to dismiss an alternatively plead UCL claim was denied. (Doc. 15 No. 36 at 10.) In Carroll, the Central District of California ultimately held, among other 16 things, that UCL claims are properly preserved at the pleading stage as alternatives to other 17 remedies available to the plaintiff. 2:21-cv-09217-FMO-RAO, Dkt. No. 94 at 8 (C.D. Cal. 18 Mar. 6, 2023). However, the Carroll court also stated that a plaintiff seeking restitution 19 under the UCL “must establish that she lacks an adequate remedy at law.” Id. at 7 (quoting 20 Sonner, 971 F.3d at 844).
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1 2 3 4 5 6 7 10 11 SARAH BLAIN, individually and on Case No.: 22-cv-00970-AJB-DEB behalf of all others similarly situated, 12 ORDER GRANTING DEFENDANT’S 13 Plaintiff, PARTIAL MOTION TO DISMISS PLAINTIFF’S FIRST AMENDED 14 v. COMPLAINT COMPANY, (Doc. No. 34) 16 Defendant. 17 18 Presently pending before the Court is Defendant Liberty Mutual Fire Insurance 19 Company’s (“Liberty Mutual”) motion to dismiss Plaintiff Sarah Blain’s claim for 20 violation of the California Unfair Competition Law (“UCL”) in Plaintiff’s First Amended 21 Complaint (“FAC”) pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 34.) 22 Plaintiff filed an opposition to the motion to dismiss (Doc. No. 36), to which Liberty 23 Mutual replied, (Doc. No. 37). Pursuant to Civil Local Rule 7.1.d.1, the Court finds the 24 instant matter suitable for determination on the papers and without oral argument. 25 Accordingly, the Court hereby VACATES the hearing currently set for July 13, 2023, at 26 2:00 p.m. For the reasons stated herein, the Court GRANTS the motion to dismiss 27 Plaintiff’s UCL claim. 28 /// 2 The Court previously outlined Plaintiff’s allegations in its Order Granting in Part 3 Liberty Mutual’s Motion to Dismiss Plaintiff’s original Complaint. (Doc. No. 27 at 2.) In 4 short, Plaintiff’s claim begins with the California “stay-at-home” orders that were 5 implemented in March 2020 as a response to the COVID-19 pandemic. (Id. at 5.) These 6 measures resulted in reduced driving across the state and respectively lowered the number 7 of claims likely to be paid by automobile insurance providers, such as Liberty Mutual. (Id.) 8 In April 2020, Liberty Mutual announced its intention to issue a 15% refund to all auto 9 insurance policyholders for two months’ worth of premiums. (Id. at 4.) Then, from June 10 2020 through May 2021, Liberty Mutual continued to issue a 5% refund to its 11 policyholders. (Id. at 9.) The gravamen of Plaintiff’s complaint is that the initial refunds of 12 15% and the subsequent refunds of 5% were inadequate and resulted in Liberty Mutual 13 enjoying an unfair windfall at the expense of its policyholders. (Id.) 14 Plaintiff’s FAC asserts two claims against Liberty Mutual: (1) breach of contract 15 under the implied covenant of good faith and fair dealing; and (2) violation of the UCL 16 under its unfairness prong. (FAC, Doc. No. 31.) Liberty Mutual filed the instant motion to 17 dismiss Plaintiff’s UCL claim under Federal Rule of Civil Procedure 12(b)(6), asserting 18 that Plaintiff failed to establish a lack of adequate legal remedies. (Doc. No. 34 at 2.) 20 A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the pleadings 21 and allows a court to dismiss a complaint upon a finding that the plaintiff has failed to state 22 a claim upon which relief may be granted. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 23 2001). The court may dismiss a complaint as a matter of law for: “(1) lack of cognizable 24 legal theory or (2) insufficient facts under a cognizable legal claim.” SmileCare Dental 25 Grp. v. Delta Dental Plan of Cal., 88 F.3d 780, 783 (9th Cir. 1996) (citation omitted). 26
27 1 The facts incorporated herein are taken from Plaintiff’s FAC and are construed as true for the limited 28 1 However, a complaint survives a motion to dismiss if it contains “enough facts to state a 2 claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 3 (2007). 4 Notwithstanding this deference, the reviewing court need not accept legal 5 conclusions as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is also improper for the 6 court to assume “the [plaintiff] can prove facts that [he or she] has not alleged . . . .” 7 Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 8 519, 526 (1983). On the other hand, “[w]hen there are well-pleaded factual allegations, a 9 court should assume their veracity and then determine whether they plausibly give rise to 10 an entitlement to relief.” Iqbal, 556 U.S. at 679. The court only reviews the contents of the 11 complaint, accepting all factual allegations as true, and drawing all reasonable inferences 12 in favor of the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002). 14 Liberty Mutual moves to dismiss Plaintiff’s UCL claim for Plaintiff’s failure to 15 allege a lack of adequate legal remedies which, under Sonner v. Premier Nutrition Corp., 16 971 F.3d 834 (9th Cir. 2020), is a prerequisite to the pursuit of an equitable claim. (Doc. 17 No. 36 at 2.) 18 Plaintiff asserts Liberty Mutual violated the unfair prong of the UCL because it failed 19 to refund premiums at an adequate rate of 30%, knowingly retained excessive profits, did 20 not conduct accurate risk assessments, and failed to disclose that it was earning excessive 21 profits, or the amount of those profits. (FAC ¶ 68.) In the FAC, Plaintiff 22 23 requests that this Court grant the relief requested under the UCL in the event that Plaintiff’s claims seeking legal remedies are revealed to be inadequate to 24 provide a complete and adequate remedy for the harms described herein. 25 Otherwise, Plaintiff and the members of the putative class may be irreparably harmed and/or denied an effective and complete remedy. 26
27 (Id. ¶ 76.) Liberty Mutual requests the Court to dismiss Plaintiff’s UCL claim because 28 “Plaintiff has not alleged any facts, except for her conditional and speculative statements 1 that she pleads her UCL claim in the alternative” and does not demonstrate a lack of 2 adequate legal remedy. (Doc. No. 34 at 10.) Plaintiff responds that even after Sonner, UCL 3 claims may be plead as an alternative remedy. (Doc. No. 36 at 9.) 4 In Sonner, the Ninth Circuit held “that the traditional principles governing equitable 5 remedies in federal courts, including the requisite inadequacy of legal remedies, apply 6 when a party requests restitution under the UCL . . . .” 971 F.3d at 844 (emphasis added). 7 There, the plaintiff dropped her claims for damages shortly before trial. Because the 8 plaintiff failed to allege an adequate legal remedy in her complaint and conceded her claim 9 for restitution was equal to the amount sought as damages, the court determined that the 10 plaintiff failed to state a claim for relief. Specifically, the court said “Sonner fails to explain 11 how the same amount of money for the exact same harm is inadequate . . . .” Id. at 844. 12 Plaintiff invites the Court to consider the recent post-Sonner holding of Carroll v. 13 Progressive Cas. Ins. Co., 2:21-cv-09217-FMO-RAO, Dkt. No. 94 (C.D. Cal. Mar. 6, 14 2023), where the motion to dismiss an alternatively plead UCL claim was denied. (Doc. 15 No. 36 at 10.) In Carroll, the Central District of California ultimately held, among other 16 things, that UCL claims are properly preserved at the pleading stage as alternatives to other 17 remedies available to the plaintiff. 2:21-cv-09217-FMO-RAO, Dkt. No. 94 at 8 (C.D. Cal. 18 Mar. 6, 2023). However, the Carroll court also stated that a plaintiff seeking restitution 19 under the UCL “must establish that she lacks an adequate remedy at law.” Id. at 7 (quoting 20 Sonner, 971 F.3d at 844). In Carroll, the court did not address the sufficiency of plaintiff’s 21 pleadings, but only the availability of UCL violations as an alternative claim. Id. at 7–8. 22 For this reason, the Court finds Carroll to be uninstructive and distinguishable from the 23 present matter. 24 Courts in the Southern District of California have routinely found that while a 25 plaintiff may alternatively plead a UCL claim that is predicated on the same underlying 26 facts as a separate claim for damages, the plaintiff must allege that equitable relief is 27 necessary to avoid irreparable harm to the plaintiffs and also that there is no adequate 28 remedy at law. See Goldstein v. Gen. Motors LLC, 517 F. Supp. 3d 1076, 1088 (S.D. Cal. 1 2021) (concluding that the prevailing view in this District is to allow claims for equitable 2 ||relief at the pleading stage but dismissing the plaintiffs’ UCL claim for failure to allege 3 ||irreparable harm); Shay v. Apple Inc., No. 20-cv-1629-GPC(BLM), 2021 WL 1733385, at 4 ||*5 (S.D. Cal. May 3, 2021) (concluding “Sonner is binding on this Court” and requires a 5 ||UCL plaintiff to plausibly allege “an inadequate remedy at law” before pursuing equitable 6 ||relief in the form of restitution or an injunction); Rivera v. Jeld-Wen, Inc., No. 21-cv- 7 ||01816-AJB-AHG, 2022 WL 3702934, at *13 (S.D. Cal. Feb. 4, 2022) (same); Fierro v. 8 || Capital One, N.A., No. 22-cv-00493-BAS-BLM, 2023 WL 1999482, at *6—7 (S.D. Cal. 9 || Feb. 15, 2023) (same). 10 In the present case, Plaintiff does not point to any facts in support of an allegation 11 |/that there is no adequate remedy at law. Relying only on conclusory and conditional 12 statements, Plaintiff's claim does not pass the pleading standards established by /gbal and 13 || Twombly, and so the Court will dismiss Plaintiff's UCL claim. /gbal, 556 U.S. at 678; 14 || Twombly, 550 U.S. at 570. 15 The Court, in its previous Order granting in part and denying in part Liberty Mutual’s 16 |}motion to dismiss Plaintiff's original Complaint, (see Doc. No. 27), expressly addressed 17 || the need to sufficiently plead a lack of adequate remedy at law. Because Plaintiff has twice 18 || failed to plausibly allege that there is no adequate remedy at law, the Court GRANTS 19 || Liberty Mutual’s motion to dismiss WITHOUT LEAVE TO AMEND. 20 ||IV. CONCLUSION 21 Based on the foregoing, the Court GRANTS Liberty Mutual’s motion to dismiss 22 || Plaintiff's UCL claim. 23 25 Dated: May 22, 2023 © □□ 26 Hon. Anthony J. attaglia 27 United States District Judge 28