ELIZABETH SHIPLEY, et al., Case No. 25-cv-03324-WHO
Plaintiffs, ORDER GRANTING MOTION TO v. DISMISS WITH LEAVE TO AMEND
META PLATFORMS, INC., et al., Re: Dkt. Nos. 20, 21, 25, 29 Defendants.
In this putative class action, plaintiffs allege that defendant Meta Platforms, Inc. (“Meta”) violated various consumer protection laws by selling its Meta Portal (the “Portal”) smart device to consumers, then later rendering the devices obsolete. Meta now moves to dismiss plaintiffs’ claims as inadequately pleaded. As described in further detail below, I agree with Meta that plaintiffs’ complaint is deficient except with respect to the unfair prong of the Unfair Competition Law (“UCL”). Accordingly, defendants’ motion to dismiss will be GRANTED IN PART and DENIED IN PART, with leave to amend. The following facts, presumed true, are drawn from plaintiffs’ First Amended Complaint (“FAC”). See Dkt. No. 18. In the fall of 2018, Meta launched the Portal, a “smart display and video calling device.” Id. ¶ 12. The Portal devices were equipped with an “Android-based operating system” that provided users with several unique features, including auto-zooming video chatting through Meta- supported messaging applications, music and video streaming, and voice command functions. Id. ¶ 13. The Portal became “particularly popular” during the COVID-19 pandemic and resulting in But this boom in sales did not last forever. In November 2022, Meta publicly announced that it would “discontinue the Meta Portal devices all together.” Id. ¶ 19. Meta continued to sell its Portal product, albeit at a lower price, to consumers, and “continued to tout its purported features.” Id. ¶ 20. By mid-2023, Meta began to phase out the Portal devices by “unilaterally removing nearly every first-party and third-party application and its voice functionality in waves, effectively early 2025.” Id. ¶ 21. These included applications like Zoom, Amazon “Alexa” voice assistant, Spotify, Facebook Live, and more. Id. As a result, Meta “rendered the Meta Portal devices significantly less functional and largely obsolete.” Id. ¶ 23. While some consumers received notice from Meta regarding the end-of-life functionality of the Portal, other consumers received no notification whatsoever. Id. ¶ 22. Today, Meta asserts that it is “committed to providing ongoing support for Meta Portal owners” by “provid[ing] notifications of major changes to the device experiences through the device itself” and “maintain[ing] system software with critical bug fixes and security.” Id. ¶ 24. But plaintiffs paint a different picture. They claim that this “commitment” is nothing but an “empty promise, as the Meta Portal devices are now significantly less usable.” Id. ¶ 25. Rule 12(b)(6) Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible when the plaintiff pleads facts that “allow the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted). There must be “more than a sheer possibility that a defendant has acted unlawfully.” Id. While courts do not require “heightened fact pleading of specifics,” a plaintiff must allege facts sufficient to “raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555, 570. In deciding whether the plaintiff has stated a claim upon which relief can be granted, the plaintiff. See Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). However, the court is not required to accept as true “allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008). If the court dismisses the complaint, it “should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000). In making this determination, the court should consider factors such as “the presence or absence of undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments, undue prejudice to the opposing party and futility of the proposed amendment.” Moore v. Kayport Package Express, 885 F.2d 531, 538 (9th Cir. 1989). Rule 9(b) Federal Rule of Civil Procedure 9(b) imposes a heightened pleading standard where a complaint alleges fraud or mistake. Under FRCP 9(b), to state a claim for fraud, “a party must state with particularity the circumstances constituting fraud,” and the allegations must be “specific enough to give defendants notice of the particular misconduct . . . so that they can defend against the charge and not just deny that they have done anything wrong.” Kearns v. Ford Motor Co., 567 F.3d 1120, 1124, 1126 (9th Cir. 2009) (citations omitted). “Averments of fraud must be accompanied by ‘the who, what, when, where, and how’ of the misconduct charged.” Vess v. Ciba-Geigy Corp., 317 F.3d 1097, 1106 (9th Cir. 2003) (citation omitted). However, “Rule 9(b) requires only that the circumstances of fraud be stated with particularity; other facts may be plead[ed] generally, or in accordance with Rule 8.” United States ex rel. Lee v. Corinthian Colls., 655 F.3d 984, 992 (9th Cir. 2011) (emphasis omitted). I. Judicial Notice As a threshold matter, the parties dispute whether I should take judicial notice of Meta’s Supplemental Terms of Services (“Supplemental TOS”) at the motion to dismiss stage. Plaintiffs claim that these documents should not be considered as they are never referenced in the complaint. Oppo. at 15–17. Even so, plaintiffs maintain that Meta has “wholly failed to meet its burden that [they] were ever even shown the Supplemental Terms of Service let alone agreed to them.” Id. at 16. This is because plaintiffs believe the documents were “not available at purchase and therefore [could not] render Plaintiffs’ and similar users’ beliefs at the time of purchase unreasonable.” Id. In response, Meta argues that these documents were provided in an unopposed request for judicial notice, and that these documents show that Meta did, in fact, limit their liability at the time of plaintiffs’ purchases. Repl. at 6 n.4; see Dkt. No. 21. As a general rule, courts “may take judicial notice of publications introduced to ‘indicate what was in the public realm at the time, not whether the contents of those articles were in fact true.’” Von Saher v. Norton Simon Museum of Art at Pasadena, 592 F.3d 954, 960 (9th Cir. 2010) (quoting Premier Growth Fund v. Alliance Capital Mgmt., 435 F.3d 396, 401 n.15 (3d Cir. 2006)). But a court “cannot take judicial notice of disputed facts contained in such public records.” Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 999 (9th Cir. 2018). I agree with Meta that judicial notice of the Supplemental TOS is proper at this stage of litigation. While plaintiffs argue that there is a factual dispute over whether plaintiffs were shown the Supplemental TOS upon purchase, and whether this document was available at purchase, evidence provided by Meta in their request for judicial notice shows that the Supplemental TOS existed prior to 2022, when both plaintiffs purchased their Portal devices. See Dkt. No. 21, Exs. B, C. The parties dispute how the Supplemental TOS was (or was not presented) to the plaintiffs, but it does not appear that the parties dispute the authenticity or accuracy of the Supplemental TOS submitted to the Court. Indeed, plaintiffs refer to the Supplemental TOS in their argument regarding the trespass to chattels. Accordingly, Meta’s request for judicial notice as to the existence and contents of the Supplemental TOS is GRANTED. Cf. Matera v. Google Inc., No. 15-CV-04062-LHK, 2016 WL 8200619, at *5 (N.D. Cal. Aug. 12, 2016) (taking judicial notice of Google’s public terms of service); Coffee v. Google, LLC, No. 20-CV-03901-BLF, 2021 WL 493387, at *4 (N.D. Cal. Feb. 10, 2021) (same). I will not make any inference that plaintiffs were, in fact, aware of these terms. II. Consumer Protection Laws Turning to the plaintiffs’ complaint, Meta argues that plaintiffs “have not identified any false or misleading statement or omission by Meta” that would lead to a successful false advertising or consumer protection claim under California’s Consumer Legal Remedies Act (“CLRA”), Unfair Competition Law (“UCL”), False Advertising Law (“FAL”), or New York’s General Business Law (“GBL”). Mot. at 5. I address each argument in turn. A. Counts III and VI: Violations of California’s CLRA and New York’s GBL Counts III and VI of the complaint allege violations of sections (a)(5), (a)(9), and (a)(16) of the CLRA, as well as section 349 of the GBL. See Mot. at 7. Meta asserts that each of these causes of action must fail because (1) plaintiffs fail to show that Meta made any affirmative misrepresentations about the Portal; (2) there is no plausible theory of an actionable omission; (3) plaintiffs fail to establish reliance or causation; and (4) the complaint fails to adhere to the Rule 9(b) heightened pleading standard for plaintiffs’ CLRA § (a)(9) claim. Plaintiffs disagree with all four arguments. As an initial matter, the parties both recognize that the CLRA and the GBL require showing either an “affirmative misrepresentation or a misleading omission” to state an actionable claim. See Mot. at 8. Both laws require plaintiffs to “plausibly allege that a reasonable consumer would be misled.” Wai Chu v. Samsung Elecs. Am., Inc., No. 1:18-CV-11742-GHW, 2020 WL 1330662, at *6 (S.D.N.Y. Mar. 23, 2020). “Whether a practice is deceptive, fraudulent, or unfair is generally a question of fact which requires consideration and weighing of evidence from both sides and which usually cannot be made on [a motion to dismiss].” Linear Tech. Corp. v. Applied Materials, Inc., 152 Cal. App. 4th 115, 134–35 (2007) (internal quotations removed). CLRA or GBL claims that “sound in fraud” are subject a heightened pleading standard under Rule 9(b). Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009). 1. Affirmative Misrepresentation To state a claim for affirmative misrepresentation, a plaintiff must show that “members of the public are likely to be deceived” by the representation. Ebner v. Fresh, Inc., 838 F.3d 958, of a reasonable public to be actionable. See McGinity v. Proctor & Gamble Co., 69 F.4th 1093, 1097 (9th Cir. 2023) (internal quotations omitted). Meta asserts that plaintiffs have failed to meet this pleading requirement. They focus particularly on the representations that plaintiff made in their complaint about the Portal, including that it was a “Gift of Deeper Connection,” a “step forward in smart video calling,” and a new way to “share deeper connections and delightful moments” with its users. See Mot. at 8; FAC ¶¶ 2, 15. Because these statements are “general assertions” that are “very unlikely to mislead a consumer,” and “say nothing about the specific characteristics or components” of the device, Meta concludes that dismissal is proper. Mot. at 8 (quoting In re Apple Inc. Device Performance Litig., 347 F. Supp. 3d 434, 457 (N.D. Cal. 2018), on reconsideration in part, 386 F. Supp. 3d 1155 (N.D. Cal. 2019)). Meta similarly claims that plaintiffs’ complaint fails to “particularly explain what is false or misleading” about Meta’s representations about the Portal, which Meta believes were true. Mot. at 9 (quoting In re Apple Inc. Device Performance Litig., 347 F. Supp. 3d at 457). In opposition, plaintiffs allege that the “experiences of both Plaintiff Shipley and Plaintiff Herod are instructive.” Oppo. at 10. They highlight that the plaintiffs were influenced to purchase a Portal after viewing advertisements that touted features of the product that were ultimately disabled. See id. at 10–11. From this, they conclude that “when a product does not operate as advertised, that states a claim under both California and New York law.” Id. at 11. Even assuming plaintiffs are correct that the affirmative misrepresentations alleged in the complaint are about the “Portal’s objective, advertised features,” their complaint is deficient. Plaintiffs maintain that Meta made “misleading misrepresentations to consumers that the Meta Portal devices had specific features, functions, and services,” but each of the alleged misrepresentations were not, in fact, false at the point of purchase. See FAC ¶ 84. Take Plaintiff Shipley, who purchased a Portal device “after being exposed to online advertisements that touted the device as an easy way to connect with isolated, elderly family members during lockdown.” Id. ¶ 36. Plaintiffs allege that the Portal’s “voice control feature factored into her purchase, as she was looking for a device that would enable her to talk to her mother who was disabled and unable plaintiffs readily admit, continued to exist until January 31, 2025. Id. ¶ 39. These statements cannot reasonably be interpreted as affirmative misrepresentations about the quality and nature of their product. The same is true for Plaintiff Herod, who purchased the Portal “after being exposed to advertisements on TV that marketed the devices as having multimedia functions for streaming content on TV.” Id. ¶ 42. Plaintiffs assert that these “media functions factored into his purchase, as he wanted to use the devices for media through apps like Facebook Live, Pluto TV, Amazon Video, and Netflix.” Id. ¶ 43. But again, these features were present in March 2022—when Herod purchased the Portal—and continued to exist until around January 2025. Id. ¶¶ 43, 45. These advertisements by Meta do not constitute an affirmative misrepresentation since the “members of the public are [not] likely to be deceived” by the representations made by Meta that were true at the time of purchase. See Ebner, 838 F.3d at 965. Plaintiffs also claim that the “continued software functionality of the Meta Portal device[s] . . . was a substantial factor” in both named plaintiffs’ decisions to purchase the devices. FAC ¶¶ 37, 43. But nowhere in the complaint do they mention that Meta affirmatively misrepresented the functionality of the devices. Rather, their argument relies on the presumption that Meta knew about the future loss of functionality of the Portal but failed to disclose it to consumers—an argument more apt for an omissions theory. In re Sony PS3 Other OS Litigation, 551 F. App’x 916 (9th Cir. 2014), relied on by plaintiffs, is distinguishable. There, the court considered whether Sony violated the CLRA by charging a premium for a “dual functionality” feature on their PS3 product, then subsequently discontinuing access to both product features. Id. at 922. The court found that “representations at the time of sale mischaracteriz[ing] the dual functionality of the PS3” were sufficient to allege a claim under sections (a)(5) and (7) of the CLRA. Id. at 920–21. Key to the court’s decision, however, was that the seller made “advertising and promotional statements” that the product would have a “ten-year lifespan.” Id. at 922. Here, plaintiffs do not articulate in the complaint whether Meta made affirmative representations about the lifespan of their products. In re Sony I am similarly unpersuaded by the other authority cited by the plaintiffs, as they all deal with situations where the defendant made an affirmative misrepresentation about the quality of the product at the time of purchase. See, e.g., Biederman v. FCA US LLC, 765 F. Supp. 3d 920(N.D. Cal. 2025); Pirozzi v. Apple, Inc., 966 F. Supp. 2d 909 (N.D. Cal. 2013); Reyes v. Upfield US Inc., 694 F. Supp. 3d 408 (S.D.N.Y. 2023). That is not the case here, where the alleged misrepresentations were, in fact, accurate at the point of purchase. Because plaintiffs have failed to allege any fact that plausibly shows an affirmative misrepresentation, their CLRA and GBL claims under this theory must be dismissed. 2. Omission An omission is actionable under the CLRA if it is “contrary to a representation actually made by the defendant, or an omission of a fact the defendant was obliged to disclose.” Wilson v. Hewlett-Packard Co., 668 F.3d 1136, 1141 (9th Cir. 2012) (quoting Daughtery v. Am. Honda Motor Co., 144 Cal. App. 4th 824, 835 (2006)). Similarly, under New York’s GLB, an omission may be actionable if a “business alone possesses material information that is relevant to the consumer and fails to provide this information.” Oswego Laborers’ Local 214 Pension Fund v. Marine Midland Bank, 85 N.Y.2d 20, 26 (1995). Plaintiffs must “plausibly allege[] that . . . [d]efendants had knowledge of the [material information] and failed to disclose or actively concealed such information.” In re Sling Media Slingbox Advert. Litig., 202 F. Supp. 3d 352, 359 (S.D.N.Y. 2016). “A defendant’s failure to reveal facts about which even it was unaware at the time will not lead to liability.” Mirza v. Ignite USA, LLC, 439 F. Supp. 3d 1058, 1072 (N.D. Ill. 2020) (citing In re Sling Media Slingbox Advert. Litig., 202 F. Supp. 3d at 359). Plaintiffs maintain that their complaint shows that “Meta failed to inform them of the possibility that they would disable key software features from the Portal Devices, rendering the device a fundamentally different product than purchased.” Oppo. at 7; FAC ¶¶ 38, 44. They highlight that when “marketing the devices, Meta touted applications like the ‘Hey Portal’ voice command and the Portals’ ability to sync with ‘Zoom and your other trusted apps,’” but the truth was that “Meta was secretly reserving the right to eventually eliminate these functionalities at its functionality at its whim” that serves as the basis of their omission theory. Id. Plaintiffs point to four pieces of evidence in the complaint they believe are dispositive on this issue. First, they highlight that the “[o]mission of the eventual removal of software applications sold with the device was material to reasonable consumers.” Id. at 9; FAC ¶¶ 37, 41, 43, 46, 87–88. Second, the “removed software applications [were] central to the functioning of these devices.” Id. at 10. Third, Meta had “exclusive knowledge of when and if it would remove applications that were part of the Portal Devices’ functionality at the time they were sold.” Id. Finally, Meta “actively concealed . . . reserving this right to remove functionality in fine print in documents available only after purchase.” Id.; FAC ¶¶ 84–86. Meta responds that “[n]one of Meta’s advertising statements . . . made any claims about the duration of support for the Portal beyond the one-year warranty.” Mot. at 11. Similarly, it points out that “nowhere do Plaintiffs allege (much less allege with particularity) that Meta in fact had such an intent at the time Plaintiffs purchased their Portals.” Id. Finally, Meta asserts that a “limited duty” applies to alleged “defects” that arise outside of a warranty period, “unless the defect relates to a safety issue.” Id. at 12. Because the alleged defects by plaintiffs are not safety related, Meta concludes that an omissions theory was inadequately pleaded. See id. Though this is a closer question than an affirmative misrepresentation, I agree with Meta. Plaintiffs bear the burden of showing in their complaint that “at the time of the alleged misrepresentations, [Meta] had the intent to mislead or omit material information about the future circumstances” of its devices. See In re Google Assistant Privacy Litig., 546 F. Supp. 3d 945, 970 (N.D. Cal. 2021). While plaintiffs’ complaint alleges that Meta “failed to disclose and actively concealed its intention to discontinue many of its features, services, and uses of the Meta Portal devices, and ultimately render the Meta Portal devices less functional,” nowhere does it plausibly explain, even under the looser pleading standard of Rule 8, that Meta knew at the time of plaintiffs’ purchase that it was going to strip the functionality of the Portal. See FAC ¶ 105. Accordingly, plaintiffs’ omission theory under the CLRA and GBL are inadequately pleaded.
3. Reliance and Causation allegedly fraudulent misrepresentations or omissions to maintain their claims under the CLRA and GBL. See Campion v. Old Republic Home Prot. Co., 272 F.R.D. 517, 537 (S.D. Cal. 2011) (citing Cohen v. DIRECTV, Inc., 178 Cal. App. 4th 966, 981 (2009)) (CLRA); Gale v. Int’l Bus. Machs. Corp., 9 A.D.3d 446, 446–47 (N.Y. App. Div. 2004) (GBL). Actual reliance is “required to demonstrate causation for purposes of Article III standing when the plaintiffs assert that their injury is the result of deceptive misrepresentations or omissions.” Phillips v. Apple, Inc., No. 15- CV-04879-LHK, 2016 WL 1579693, at *6 (N.D. Cal. Apr. 19, 2016) (citing In re iPhone Application Litig., 6 F. Supp. 3d 1004, 1015 (N.D. Cal. 2013)). The parties disagree, however, whether this burden has been met by plaintiffs. Meta asserts that the consumer protection claims fail because the complaint “falls well short of the Rule 9 pleading standard (and Rule 8).” Mot. at 14. Specifically, Meta claims that plaintiffs “do not identify any particular advertisement or sales materials they even saw before purchasing the Portal,” and “fails to identify any advertisements that Plaintiffs could have viewed and relied upon prior to purchase.” Id. Even if plaintiffs had identified such advertisements, Meta claims that they “never plead[ed] that they ‘actually relied’” on them. Id. at 14–15. In opposition, plaintiffs point to two sections of their complaint—paragraphs 41 and 46— that they believe meet the requisite pleading standard. Oppo. at 12. Those paragraphs note that plaintiffs Shipley and Herod “would not have purchased the Meta Portal device had [they] known that Meta would unilaterally make the device significantly less functional within years of [their] purchase or otherwise would have paid substantially less for the Meta Portal Device.” Oppo. at 12; FAC ¶¶ 41, 46. Since plaintiffs believed the alleged misrepresentation and omission is “material,” they conclude that “it can be inferred that the Plaintiffs and all consumers would have behaved differently” if Meta made them aware of such loss of functionality, and thus “actually relied” on their advertisements. Id. Kearns v. Ford Motor Company, cited by Meta, is instructive on this point. 567 F.3d 1120 (9th Cir. 2009). There, the Ninth Circuit squarely addressed a similar complaint raising claims under the CLRA. Finding that Rule 9(b) pleading applies to CLRA claims, the court concluded sales material specifically stated.” Id. at 1126. In other words, to successfully plead under Rule 9(b), a party must not state “neutral facts,” but rather articulate “the who, what, when, where, and how of the misconduct alleged.” Id. Here, plaintiffs have failed to articulate with reasonable particularity the circumstances surrounding the named plaintiffs’ decisions to purchase the Portal device. The factual allegations about plaintiff Shipley, for example, fail to address when she was “exposed to online advertisements that touted the device as an easy way to connect with isolated, elderly family members during lockdown.” FAC ¶ 36. Nor does it explain what Shipley relied on in those advertisements in deciding to purchase the Portal—the complaint merely says that the “continued software functionality” and “voice control feature factored into her purchase.” Id. ¶ 37. Under Kearns, these allegations seem more akin to “neutral facts” that the level of particularity required for CLRA claims. See 567 F.3d at 1126. The recitation of plaintiff Herod’s circumstances similarly fails under Rule 9(b) for lack of actual reliance and causation. While plaintiffs do provide a time frame for when Herod viewed the advertisements—“[i]n or around March 2022”— there is a lack of facts specifically showing reliance on the advertisement. FAC ¶ 42. Plaintiffs’ reliance on In re MacBook Keyboard Litigation, No. 5:18-CV-02813-EJD, 2019 WL 1765817, at *7 (N.D. Cal. Apr. 22, 2019), is also misplaced. There, the Hon. Judge Davila explained that when an “omission is material, then it can be inferred that the plaintiff would have behaved differently.” Id. However, for this to apply, a plaintiff must show that “had the omitted information been disclosed, one would have been aware of it and behaved differently.” Id. (quoting Mirkin v. Wasserman, 5 Cal.4th 1082, 1093 (1993)). Because plaintiffs have failed to identify the advertisements the named plaintiffs viewed, it is impossible to conclude from the face of the complaint what information was provided in the advertisement, what information wasn’t, and how the plaintiffs relied on those statements in making their purchase decisions. Given the lack of actual reliance and causation, plaintiffs’ CLRA and GBL claims also fail on this ground. 4. Section (a)(9) of the CLRA Meta finally claims that the plaintiffs’ (a)(9) claim under the CLRA must be dismissed for “failure to allege that Meta acted with fraudulent intent.” Mot. at 15. Section (a)(9) prohibits the “[a]dvertising [of] goods or services with intent not to sell them as advertised.” Cal. Civ. Code § 1770(a)(9). As explained earlier, to plead fraudulent intent under the heightened Rule 9(b) standard, plaintiffs must show that “at the time of the alleged misrepresentations, [Meta] had the intent to mislead or omit material information about the future circumstances” of its devices. See In re Google Assistant Privacy Litig., 546 F. Supp. at 970. Plaintiffs have failed to meet this burden because they do not show how Meta had the intent to deceive plaintiffs at their respective times of purchases. B. Count II: California’s FAL Count II of plaintiffs’ complaint alleges violations of the California False Advertisement Law. See Cal. Bus. & Prof. Code § 17500. Under the FAL:
It is unlawful for any . . . corporation . . . . with intent . . . to dispose of . . . personal property . . . to induce the public to enter any obligation relating thereto, to make or disseminate or cause to be made or disseminated . . . from this state before the public in any state, in any newspaper or other publication, or any advertising device, or by public outcry or proclamation, or in any other manner or means whatsoever, including over the Internet, any statement . . . which is untrue or misleading and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading. Id. Plaintiffs allege that Meta’s “material misrepresentations and omissions” violate the FAL because they “knew or should have known that [they] were false, deceptive, and misleading.” FAC ¶¶ 77–78. Meta, however, argues that the FAL claim fails for the reasons the consumer protection claims fail—that plaintiffs have “not alleged any actionable misrepresentation” or “any statement that was rendered misleading by the omission of relevant information.” Mot. at 16. Plaintiffs provide no meaningful response in their opposition, except that it is “necessary only to show that members of the public are likely to be deceived” to raise a FAL claim. Oppo. at 7 (quoting Kasky v. Nike, Inc., 27 Cal. 4th 939, 951 (Cal. 2002)) (cleaned up). For the reasons described above, I agree with Meta. As explained in Section II.A.1, supra, plaintiffs have not provided any affirmative misrepresentation that would meet the Rule 9(b) pleading standard under the FAL. See, e.g., Norcia v. Samsung Telecomms. Am., LLC, 2015 WL 4967247, at *8 (N.D. Cal. Aug. 20, 2015) (requiring an affirmative statement to plead under the FAL). Even taking plaintiffs’ “likely to be deceived standard” into consideration, the complaint still fails, because there are no facts suggesting that any affirmative statements made by Meta deceived the consuming public. See Kasky, 27 Cal. 4th at 951. Nor does plaintiff identify any “affirmative statement that was false or misleading by the omission of relevant and material information.” Stewart v. Electrolux Home Prods., Inc., 304 F. Supp. 3d 894, 908 (E.D. Cal. 2018). Unless plaintiffs adequately plead an affirmative misrepresentation made by Meta, I cannot find that their FAL claim is valid. C. Count I: Violation of California’s Unfair Competition Law (the “UCL”) Meta also argues that plaintiffs have failed to state a claim under California’s UCL, which prohibits any “unlawful, unfair, or fraudulent business act or practice.” Cal. Bus. & Prof. Code § 17200. “Each prong of the UCL is a separate and distinct theory of liability,” and must be analyzed independently. Kearns, 567 F.3d at 1127. Plaintiffs’ complaint alleges violations of all three prongs of the statute, see FAC ¶ 68, but their opposition does not rebut Meta’s argument that the “fraudulent” prong is inapplicable. Oppo. at 5. Accordingly, plaintiffs have forfeited this argument, and I focus my attention to whether the complaint properly alleges violations of the “unfair” or “unlawful” prongs. 1. Unfair The “unfair” prong of the UCL creates a cause of action for a “business practice that is unfair even if not proscribed by some other law.” In re Adobe Sys., Inc. Priv. Litig., 66 F. Supp. 3d 1197, 1225 (N.D. Cal. 2014) (citing Korea Supply Co. v. Lockheed Martin Corp., 29 Cal.4th 1134, 1143 (2003)). This prong is “intentionally framed in its broad, sweeping language, precisely to enable judicial tribunals to deal with the innumerable new schemes which the fertility of man’s invention would contrive.” Cel-Tech Commc’ns, Inc. v. L.A. Cellular Tel. Co., 20 Cal. 4th 163, 180 (1999) (internal quotations omitted). As a result, courts have applied two tests to analyze “unfair” UCL claims: (1) a balancing test, and (2) a tether test. Prince-Weithorn v. GMAC Mortg., LLC, No. CV 11-00816 SJO (PLAx), 2011 WL 11651984, at *7 (C.D. Cal. May 5, 2011).1 These tests are not mutually exclusive, and plaintiffs assert that their complaint satisfies both. Epic Games, Inc. v. Apple, Inc., 67 F.4th 946, 1000 (9th Cir. 2023). Plaintiffs plausibly allege a UCL claim under the balancing test, but not the tether test. a) Balancing Test Under the “balancing” test, courts consider whether the challenged business practice is “immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers and requires the court to weigh the utility of the defendant’s conduct against the gravity of the harm to the alleged victim.” Drum v. San Fernando Valley Bar Ass’n, 182 Cal. App. 4th 247, 257 (2010). Plaintiffs maintain that their complaint satisfies the balancing test by analogizing to a Ninth Circuit case, In re Sony PS3 Other OS Litigation, 551 F. App’x 916 (9th Cir. 2014). I do not agree with the analogy, but I do believe that they satisfy the test. In In re Sony PS3, the court was asked to determine whether Sony violated the UCL by charging a premium for a “dual functionality” feature on their PS3 product, then subsequently discontinuing access to both product features. Id. at 922. The court ultimately concluded that plaintiffs sufficiently alleged an injury by pleading that (1) they “lost money because they would not have purchased or would have paid less . . . if they had known that Sony would disable or remove one or both of these advertised features”; (2) they “could not have reasonably avoided this injury because they would have lost access to [one feature] if they chose not to download the update which disabled the other . . . feature”; and (3) there were “no countervailing benefits to consumers . . . that outweigh the substantial injury.” Id. Plaintiffs alleged that the manufacturer promoted to consumers that the PS3 would have both “dual functionality and [a] ten-year lifespan.” See id. While the “ten-year” representation was meant to cover the PS3 device itself, and not the “dual functionality” features, the Ninth Circuit concluded that the complaint “adequately . . . alleged that members of the public were likely to be deceived by Sony’s advertising and promotional statements” in violation of the UCL. Id.
Commission Act as “guidance.” See Lozano v. AT & T Wireless Servs., Inc., 504 F.3d 718, 736 Here, however, plaintiffs do not allege any facts showing that Meta represented the features of the Portal would continue to operate for an extended period of time.2 Although plaintiffs do allege facts the court in In re Sony PS3 found sufficient, the underlying factual background of these two cases does not warrant analogy. That said, I agree with plaintiffs that they have pleaded an unfair UCL claim under the balancing test. Plaintiffs allege that “Meta caused them substantial injury by charging a premium for Portals’ software features . . . and then discontinued access to that same software.” Oppo. at 6. They also claim that they “lost money as a result,” and that there were “no countervailing benefits to consumers or competition that outweigh the substantial injury to consumers.” Id. They point to a staff report created by the FTC, which states that the “failure to provide software updates or the failure to disclose the duration of software support raises concerns about harm consumers cannot avoid,” and that a practice is unfair if “it is likely to cause substantial injury that could not be reasonably avoided by consumers.” Oppo. at 6; FAC ¶ 30. And they cite a letter drafted by consumer advocacy groups to the FTC, which calls out the Portal as an example of deceptive software tethering and bricking. FAC ¶ 35 (“Other companies kill software support and also the device itself, as Facebook did with its Portal product.”). These facts, taken in the aggregate, plausibly show that Meta was engaging in “immoral, unethical, oppressive, unscrupulous or substantially injurious” conduct by “bricking” the Portal devices. See Drum, 182 Cal. App. 4th at 257. b) Tether Test Plaintiffs also assert that the complaint satisfies the tether test. Under the tether test, plaintiffs must show the effects of Meta’s conduct is “comparable to or the same as a violation of the law, or otherwise significantly threatens or harms competition.” In re Adobe Sys., Inc. Priv.
2 Meta also argues that plaintiffs overlook Clemens v. DaimlerChrysler Corp., 534 F.3d 1017 (9th Cir. 2008), which Meta asserts is controlling. There, the Ninth Circuit held that the “failure to disclose a defect that might, or might not, shorten the effective life span of an automobile part that functions precisely as warranted throughout the term of its express warranty . . . does not constitute an unfair practice under the UCL.” Id. at 1026–27. I do not agree that the alleged Litig., 66 F. Supp. 3d at 1226 (cleaned up). While plaintiffs claim that Meta’s “acts and practices offend an established public policy in the marketplace,” it does not explain how these acts are “comparable to or the same as a violation of the law.” FAC ¶ 65; cf. id. (finding plaintiffs pleaded adequate facts to bring a claim under the “tethering test” after showing various statutes reflect California’s public policy of protecting consumer data). I do not think this one statement is sufficient to show how Meta’s acts violated antitrust law or would be akin to such violations. Plaintiffs’ complaint is deficient concerning the tether test. 2. Unlawful The “unlawful” prong of the UCL “borrows violations of other laws and treats them as unlawful practices that the unfair competition law makes independently actionable.” Cel-Tech Commc’ns, Inc., 20 Cal. 4th at 180 (cleaned up). Plaintiffs’ complaint alleges that Meta violates the “unlawful” prong due to its other violations of the CLRA, GBL, and the FAL. See FAC ¶ 68. Each of those claims fail for being inadequately pleaded. Accordingly, plaintiffs do not currently have an actionable claim under the “unlawful” prong of the UCL. III. Breach of Implied Warranty Meta seeks to dismiss plaintiffs’ two claims for breach of implied warranty (Counts IV and V) because plaintiffs’ “own allegations confirm that each of them had access to the full range of functionality on the Portal for the entire warranty period (and then some).” Mot. at 19. A. Count IV: Song-Beverly Consumer Warranty Act The Song-Beverly Consumer Warranty Act (“SBCWA”) was enacted to “regulate warranties and strengthen consumer remedies for breaches of warranty.” Keegan v. Am. Honda Motor Co., Inc., 838 F. Supp. 2d 929, 944 (C.D. Cal. 2012). The SBCWA intends to protect purchasers of “consumer goods,” defined as “any new product or part thereof that is used, bought, or leased for use primarily for personal, family, or household purposes, except for clothing and consumables.” Cal. Civ. Code § 1791(a). Under the act, an implied warranty of merchantability guarantees that “consumer goods meet each of the following: (1) Pass without objection in the used; (3) Are adequately contained, packaged, and labeled; [and] (4) Conform to the promises or affirmations of fact made on the container or label.” Id. § 1791.1(a). Plaintiffs’ complaint asserts that Meta violated the SBCWA by providing an “implied warranty that the Meta Portal devices, and any parts thereof, [were] merchantable and fit for the ordinary purposes for which they were sold—as smart devices with numerous features and functions including video-calling, streaming, effects, storytelling, and voice command.” FAC ¶ 97. However, plaintiffs assert that the Portal devices were “not fit for their ordinary purposes because . . . Meta did not maintain continued software functionality of the Meta Portal devices,” causing them to lose their “advertised features and functions.” Id. Meta asserts that plaintiffs’ SBCWA claim is “limited by statute to a maximum of ‘one year following the sale of new consumer goods to a retail buyer.’” Mot. at 19 (quoting Cal. Civ. Code § 1791.1(c)). Further, the express warranty provided for the Portal was limited to one year after purchase, and both named plaintiffs did “not allege they experienced any issues within one year of either purchase.” Mot. at 19–20. Because the SBCWA claim is “based on events that occurred well after the expiration of the one-year warranty,” Meta asks for this claim to be barred. Id. at 20. In response, plaintiffs assert that their SBCWA claim is not time-barred since consumers are not subject to the one-year limitation when the issue manifests more than a year after purchase. See Oppo. at 18; Mexia v. Rinker Boat Co., 174 Cal. App. 4th 1297, 1307–09 (2009); Keegan, 838 F. Supp. 2d at 948. But each of these cases involved defects that were present at the time of sale—plaintiffs do not contest that the Portals sold to the named plaintiffs were, in fact, functional at the time of purchase. See Mexia, 174 Cal. App. 4th at 1308 (“[T]he fact that the alleged defect resulted in destructive corrosion two years after the sale of the boat does not necessarily mean that the defect did not exist at the time of sale.”); Keegan, 838 F. Supp. 2d at 948 (“In the case of a latent defect, a product is rendered unmerchantable, and the warranty of merchantability is breached, by the existence of the unseen defect, not by its subsequent discovery.”) (cleaned up). I agree with Meta that plaintiffs’ FAC, at least as currently pleaded, suggests that the SBCWA is B. Count V: California Commercial Code Meta additionally claims plaintiffs’ implied warranty claim under the California Commercial Code “fails because Meta properly disclaimed all implied warranties.” Mot. at 20. It argues that the Warranty for the Portal “states in clear and conspicuous language that [Meta does] not extend any implied or statutory warranties, conditions or representations regarding the Product or any connected software or online services.” See Mot. at 20–21 (cleaned up); Compl., Ex. A at 3. Plaintiffs conversely argue that the Warranty “facially applies only to manufacturing defects and not fraudulent conduct that violates consumer protection laws.” Oppo. at 13 (emphasis in original). Even so, plaintiffs argue that “Meta may not use fine print to disclaim its prominent misrepresentations and omissions.” Id. at 15. In reply, Meta asserts that so long as the Portal was “functional throughout the period of the express warranty, a later failure would not conflict with a statement regarding [functionality] because there was no representation as to the durability of [the product].” Repl. at 5 (citing Berenblat v. Apple, Inc., Nos. 08-4969 JF (PVT), 09-1649 JF (PVT), 2009 WL 2591366, at *6 (N.D. Cal. Aug. 21, 2009)). Meta’s arguments appear to be supported by case law on this issue. “Similar claims under the CLRA have been rejected because . . . [any] statement describing any feature would be actionable when either the feature—or product as a whole—eventually failed.” Berenblat, 2009 WL 2591366, at *6 (citing Long v. Hewlett-Packard Co., No. C 06-02816, 2007 WL 2994812, at *7 (N.D. Cal. July 27, 2007), aff’d, 316 F. App’x 585 (9th Cir. 2009)). While plaintiffs raise this argument in the context of the California Commercial Code, not the CLRA, the same principles apply—Meta provided a one-year limitation of Warranty and the plaintiffs’ products were certainly functional throughout that period. While plaintiffs may be correct that the Warranty facially applies to manufacturing defects, other provisions and documents seem to support Meta’s position. First, the Warranty notes that Meta “may update, modify or limit such software in [their] sole discretion,” so long as they “continue to maintain (or exceed) the Warranted Functionality.” Compl. Ex. A at 2. In addition, as described above, the Supplemental TOS indicated that Meta could “suspend, eliminate, change, parts or all of [the] Portal.” Repl. at 5. Even construing all facts in favor of the plaintiff, it does not appear plausible that Meta did not cover its bases by disclaiming itself from liability under both the Warranty and Supplemental TOS. Plaintiffs’ California Commercial Code argument should therefore be dismissed. IV. Count VII: CFAA Meta also moves to dismiss plaintiffs’ claim under the CFAA. Meta argues that the complaint impermissibly attempts to “repurpose [the CFAA] into a sweeping consumer protection statute” rather than an “anti-hacking statute.” Mot. at 21. Plaintiffs, conversely, assert that the allegations in the complaint sufficiently demonstrate that the procedural and standing requirements of the CFAA are met. Oppo. at 19–21. The CFAA makes it unlawful to “knowingly cause[] the transmission of a program, information, code, or command, and as a result of such conduct, intentionally cause[] damage without authorization, to a protected computer.” 18 U.S.C. § 1030(a)(5)(A). The CFAA defines “damage” as “any impairment to the integrity or availability of data, a program, a system, or information.” Id. § 1030(e)(8). Plaintiffs assert that Meta’s decision to remove many advertised features from the Portal was “without authorization because, at the time of purchase, Plaintiffs had no reason to believe Meta would cut these features, cease supporting the software, and make the device significantly less functional within only a couple years of purchase.” Oppo. at 19; FAC ¶¶ 2, 4, 26–27, 41, 46. They also point to the fact that the CFAA cause of action indicates that the device owners “did not provide Meta with authorization to access their Meta Portal devices for purposes of limiting the functionality of the Meta Portal.” FAC ¶ 118. Meta, however, argues that plaintiffs do not plead that Meta accessed their Portal devices without authorization to “intentionally cause[] damage,” as the CFAA requires. See Repl. at 12; 18 U.S.C. § 1030(a)(5)(A) (emphasis added). Rather, the complaint only asserts that plaintiffs “did not provide Meta with authorization to access their Meta Portal for the purposes of limiting the functionality of the Meta Portal.” Id.; FAC ¶ 118 (emphasis added). Because plaintiffs’ devices generally—Meta concludes that this CFAA argument is not cognizable under Van Buren v. United States, 593 U.S. 374, 396 (2021). I agree with Meta that the CFAA does not seem applicable here, at least as currently pleaded. The Supplemental Terms of Service discloses that Meta may “suspend, eliminate, change, or update certain features” or “restrict access to parts or all of [the] Portal.” Repl. at 13; see RJN Ex. 3. Courts routinely dismiss claims under the CFAA when the terms of service provided “notice of the potential . . . update and its effects,” such as the changes to the functionality of the Portal device. See Parziale v. HP, Inc., No. 5:19-CV-05363-EJD, 2020 WL 5798274, at *7 (N.D. Cal. Sept. 29, 2020); Cobbs v. Robinhood Fin. LLC, No. 2:21-CV-00843- VAP-MRWx, 2021 WL 1035123, at *3 (C.D. Cal. Feb. 10, 2021) (finding the challenged transmission was “authorized by Plaintiff in the Customer Agreement”). Accordingly, I dismiss plaintiffs’ CFAA claim with leave to amend to provide more facts suggesting that Meta “intentionally caused damage” to their Portal devices. V. Count VIII: Trespass to Chattels Plaintiffs’ eighth Cause of Action is a trespass to chattels claim. The complaint asserts that “[i]n or around November 2022, Defendants announced its intention to unlawfully take from Plaintiffs’ and Class Members’ possession an operational Meta Portal device through its forced discontinuance, leaving Plaintiffs and the Class Members with a less useful product.” FAC ¶ 123. Because Portal device owners “did not provide Meta with authorization to access their Meta Portal devices for purposes of limiting the functionality of the Meta Portal,” plaintiffs’ complaint concludes that trespass to chattels occurred. Id. ¶ 118. Meta asserts that this claim, like the CFAA, turns on whether plaintiffs “consent[e]d to [Meta’s] exercise of dominion” over their property. Mot. at 24; Bank of N.Y. v. Fremont Gen. Corp., 523 F.3d 902, 914 (9th Cir. 2008). And like the CFAA claims, Meta concludes that plaintiffs “have not plausibly alleged access without authorization by Meta,” and even so, plaintiffs “consented to Meta’s access to their devices through the Supplemental Terms of Service and Warranty.” Mot. at 25 (cleaned up). documents.” Oppo. at 22. While the Supplemental TOS states that Meta “may” introduce or eliminate “certain” features of the Portal, plaintiffs claim that the language only allows for a “narrow set of circumstances in which Meta is authorized to access users’ devices”: Functionality may change or be limited. Your Portal’s functionality, performance, or both may change over time. We may introduce new features (including new Facebook Products, Facebook Company Products or Third- Party Services), impose limits on, suspend, eliminate, change, or update certain existing features (including Facebook Products, Facebook Company Products or Third-Party Services) or any part of your Portal’s services, or restrict access to parts or all of your Portal. Certain Portal features may require a Facebook account. If our software is downloaded to your Portal or used by you, you give us permission to download and install upgrades, updates, and additional features for the software where available. For clarity, this right includes permission to download and install upgrades, updates, and additional features for software embedded on your device, including during device setup. Id. (emphasis added). Under this language, plaintiffs argue, Meta is limited to accessing the Portals to only “upgrad[e]” or “updat[e]” the Portal with “additional features,” and does not permit “eliminating nearly all functionality entirely.” Id. While plaintiffs are certainly correct in highlighting the language above, other language in the same paragraph—namely, “impose limits on, suspend, eliminate, change, or update certain existing features”—suggests that Meta could unilaterally remove or adjust certain features from the Portal. See Repl. at 15. Under this argument of plaintiffs, then, they would have been constructively “on notice of [Meta’s] ability to interfere” with their purchased devices and services, meaning that Meta did not act without authorization. See Price v. Apple, Inc., No. 21- CV-02846-HSG, 2022 WL 1032472, at *6 (N.D. Cal. Apr. 6, 2022). Accordingly, Meta’s motion to dismiss plaintiffs’ trespass to chattel claims is granted. VI. Count IX: Unjust Enrichment Finally, Meta asserts that plaintiffs failed to successfully plead an unjust enrichment claim. See Oppo. at 25. The parties dispute whether the unjust enrichment claim may be pleaded as an independent cause of action. Meta asserts that “California does not recognize a separate cause of action for unjust enrichment,” and that “courts have consistently dismissed stand-alone claims for unjust enrichment.” Mot. at 25; Brodsky, 445 F. Supp. 3d at 132–34. Plaintiffs, however, contend that the California Supreme Court has recognized unjust enrichment as a standalone cause of action since 2015. See Oppo. at 23; Bruton v. Gerber Prods. Co., 703 F. App’x 468, 470 (9th Cir. 2017) (citing Hartford Cas. Ins. Co. v. J.R. Mktg., L.L.C., 61 Cal. 4th 988, 1000 (Cal. 2015)). “California law on unjust enrichment remains somewhat unclear.” Hammerling v. Google LLC, 615 F. Supp. 3d 1069, 1096 (N.D. Cal. 2022). The Ninth Circuit “has construed the common law to allow an unjust enrichment cause of action through quasi-contract.” ESG Cap. Partners, LP v. Stratos, 828 F.3d 1023, 1038 (9th Cir. 2016). “Since ‘the theory underlying’ an unjust enrichment claim is ‘that a defendant has been unjustly conferred a benefit ‘through mistake, fraud, coercion, or request’ . . . [t]he return of that benefit is the remedy ‘typically sought in a quasi-contract cause of action.’” Lawyer v. Homary Int’l Ltd., No. [], 2025 WL 1571856, at *6 (N.D. Cal. June 2, 2025) (quoting Astiana v. Hain Celestial Grp., Inc., 783 F.3d 753, 762 (9th Cir. 2015)). Here, plaintiffs allege that they are entitled to restitution because Meta sold the Portal devices “with the intention to discontinue any useful value . . . resulting in a product that is worthless to Plaintiffs and Class Members, who overpaid for their Meta Portal devices and/or would not have purchased the Meta Portal devices had they known that Defendants would unilaterally phase out the Meta Portal devices and their services, rendering them less functional.” FAC ¶ 128. I will construe the unjust enrichment claim as one for quasi-contract: Meta allegedly enticed plaintiffs to purchase the Portal through fraudulent misrepresentations and omissions, and was unjustly enriched as a result. See Lawyer, 2025 WL 1571856, at *6 (plaintiff sufficiently stated a quasi-contract cause of action by alleging defendants had enticed plaintiffs to “purchase its products through fraudulent misrepresentations”); Astiana, 783 F.3d at 762 (same); ESG Cap. Partners, 828 F.3d at 1039 (same). Because plaintiffs have not sufficiently pleaded the fraudulent misrepresentations and omissions, this cause of action will be dismissed with leave to amend. For the reasons described above, the Court DENIES Meta’s motion regarding plaintiff’s UCL claim under the unfair theory and GRANTS Meta’s motion with respect to all other causes 1 of action. Plaintiffs shall have leave to amend the Complaint by January 16, 2026. 3 Dated: December 18, 2025 . \f 4 illiam H. Orrick 5 United States District Judge 6 7 8 9 10 11 a 12
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