Krisztian Mark Riez v. Turo, Inc.

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 KRISZTIAN MARK RIEZ, Case No. 25-cv-06901-AMO

8 Plaintiff, ORDER OF DISMISSAL v. 9 Re: Dkt. Nos. 35, 39, 46, 47, 51 10 TURO, INC., Defendant. 11

12 13 Plaintiff Krisztian Mark Riez asserts claims of negligence and breach of contract arising 14 from his rental of a third-party vehicle through Defendant Turo, Inc.’s (“Turo”) online platform. 15 Before the Court are several motions, including Turo’s motion to dismiss the First Amended 16 Complaint. Dkt. No. 35. The matter is fully briefed and suitable for decision without oral 17 argument. Accordingly, the hearing set for June 4, 2026, is VACATED. See Civil L.R. 7-6, Fed. 18 R. Civ. Pro. 78(b). Having read the parties’ papers and carefully considered their arguments and 19 the relevant legal authority, and good cause appearing, the Court hereby GRANTS Turo’s motion 20 to dismiss for the following reasons. 21 I. BACKGROUND 22 Riez’s First Amended Complaint (“FAC”) alleges he booked a vehicle using Turo’s online 23 peer-to-peer marketplace, he was stopped at the United States and Canada border while he was 24 driving the minivan, and he was shortly detained after the minivan tested positive for the presence 25 of a controlled substance during a routine border stop. These are the same facts Riez alleged in his 26 prior pleading, which was dismissed with leave to amend to state additional facts showing that 27 Plaintiff’s injury was traceable to Turo. See Dkt. No. 24. The Court restates the relevant factual 1 A. Factual Background1 2 Turo offers an online personal sharing program that connects vehicle owners or their 3 authorized representatives (“hosts”) with individuals (“guests”) seeking to book hosts’ vehicles 4 throughout the United States and in Canada, France, or Australia. Armstrong Decl. (Dkt. No. 35- 5 1) ¶ 3. Turo does not own the vehicles hosts list for booking in its online peer-to-peer 6 marketplace, and it does not maintain hosts’ vehicles. Id. ¶ 4. 7 To utilize the Turo platform, both hosts and guests agree to Turo’s Terms of Service (the 8 “Terms”). Armstrong Decl. ¶ 7. Turo’s Terms state in part:

9 Turo may, but does not commit to, undertake efforts to ensure the safety of vehicles shared through the Services. We do not make any 10 representations about, confirm, or endorse the safety, roadworthiness, or legal status of any vehicles shared via the 11 Services. Rather, hosts have sole responsibility to ensure their vehicles are in safe and operable condition, legally registered to be 12 driven on public roads, have a clean title (e.g., non-salvaged/non- branded/non-washed/non-written off), not subject to any applicable 13 safety recalls, and otherwise satisfy our vehicle eligibility requirements. 14 15 Armstrong Decl., Ex. A at 3. Specifically relevant to guests, the Terms state in part:

16 You acknowledge that Turo is not responsible and shall not be liable for the safety, roadworthiness, or legal status (e.g., whether the 17 vehicle is legally registered or the subject of a stolen vehicle report) of any vehicles shared via the Services. Rather, hosts have sole 18 responsibility to ensure their vehicles are in safe and operable condition, legally registered to be driven on public roads, not subject 19 to a missing or stolen vehicle report, have a clean title (e.g., non- salvaged/non-branded/non-washed/non-written off), not subject to 20 any applicable safety recalls, and otherwise satisfy our vehicle eligibility requirements. You also acknowledge and agree that 21 neither Turo nor hosts are responsible for lost or stolen property left in any vehicle or taken or damaged during a trip. 22 Id. at 13. 23 24 25 1 Though the Court typically accepts the truth of a plaintiff’s allegations for purposes of resolving 26 a motion to dismiss, given the substance of Turo’s factual attack, the Court considers evidence outside the complaint as well. See Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 27 2004) (“In resolving a factual attack on jurisdiction, the district court may review evidence beyond 1 Riez alleges that on or about February 10, 2025, he booked a 2025 Dodge Grand Caravan 2 (the “minivan”) through Turo for a trip scheduled for February 18-20, 2025. FAC at 4. Under the 3 car-sharing agreement, Riez obtained “ ‘Premier’ protection providing up to CAD $2,000,000 in 4 liability coverage and other protections.” Id. Turo represented that the “vehicles listed on its 5 platform are safe, properly maintained, and covered by appropriate insurance and protections.” Id. 6 at 5. In the course of Riez’s use of the minivan, officials from the Canada Border Services 7 Agency (“CBSA”) inspected the minivan and found it tested positive for the presence of fentanyl. 8 Id. at 5. The positive drug test resulted in Riez’s immediate detention, searches of his person and 9 personal property, and reputational harm as well as a host of medical and psychological harms. Id. 10 at 5-6. Riez reported the fentanyl contamination and border detention to Turo. Id. at 8. 11 Riez’s alleged injuries as a result of the border stop include (1) loss of liberty, humiliation, 12 and emotional distress, (2) diagnosed PTSD relapse, depression, anxiety, and sleep disturbances, 13 (3) reputational harm, (4) economic loss, including the loss of a CAD $850,000 expected 14 sponsorship opportunity, and (5) out-of-pocket medical, therapy, and legal-consultation expenses. 15 See FAC at 11-12. Riez does not claim that he suffered any physical harm from fentanyl 16 exposure. Id. at 6 (alleging he and his passenger were “detained” for several hours, “questioned,” 17 and “subjected . . . to intrusive searches.”). Riez does not specify how the incident itself caused 18 him reputational harm, particularly given that border officials did not take any action against him 19 beyond the investigatory detention. FAC at 6. Riez suggests that his detention may impact future 20 border crossings. Id. at 3. Finally, Riez posits that the border detention created a mental health 21 impairment that contributed to the collapse of an approximate CAD $850,000 sponsorship deal for 22 a non-party business entity. Id. at 12; see also id., Ex. F. Riez seeks compensatory damages in the 23 amount of US $1,500,000, an award of damages for emotional distress, mental-health treatment, 24 reputational injury, and all related medical and economic losses, as well as public injunctive relief. 25 See id. at 18-19. 26 B. Procedural History 27 On July 11, 2025, Riez filed his original complaint against Turo in San Francisco Superior 1 misrepresentation, (4) concealment, and (5) promissory estoppel. See Notice of Removal, Ex. A, 2 (Dkt. No. 1). On July 14, 2025, Turo removed the action to the District Court for the Northern 3 District of California based on diversity jurisdiction. See Notice of Removal, Dkt. No. 1. 4 On August 21, 2025, Turo filed a motion to dismiss and motion to strike the complaint. See Dkt. 5 No. 9. On December 19, 2025, the Court granted Turo’s motion to dismiss for lack of subject 6 matter jurisdiction with leave to amend. See Dkt. No. 24. 7 On January 13, 2026, Riez filed the FAC, alleging claims for (1) negligence and (2) breach 8 of contract and implied covenant of good faith and fair dealing. See Dkt. No. 29. In this amended 9 pleading, Riez chose not to amend the dismissed claims of either fraud or promissory estoppel. Id. 10 Turo now moves to dismiss the FAC on grounds similar to those raised in its first motion 11 to dismiss. Dkt. No. 35. Following complete briefing, Riez filed a motion for leave to file a sur- 12 reply brief. Dkt. No. 47. Riez’s argument that Turo raised certain arguments for the first time in 13 its reply brief misrepresents the contents of Turo’s motion as well as the reply, but further, Riez’s 14 arguments do not address the issue of standing discussed below. See id. The Court therefore 15 DENIES Riez’s motion for leave to file a sur-reply. 16 II. DISCUSSION 17 Turo includes multiple requests for relief in its motion, including (1) a motion to dismiss 18 under Rule 12(b)(1) for lack of subject matter jurisdiction based on a lack of standing;2 (2) a 19 motion to dismiss under Rule 12(b)(6) for failure to state a claim sounding either in negligence or 20 in contract; (3) and a motion under Rule 12(f) to strike (a) a new cause of action included in the 21 FAC withoutleave of Court or Defendant’s consent, as well as (b) Riez’s request for injunctive 22 relief. 3 See generally Dkt. No. 35. As it did in its order dismissing Riez’s original complaint, the 23 2 Turo additionally filed a request for judicial notice in support of its motion. Dkt. No. 36. Riez 24 states that he does not oppose judicial notice of the materials submitted by Turo, he instead disagrees with their legal significance. See Dkt. No. 37 at 14. The Court agrees with Riez – trial 25 courts may consider the existence of judicially-noticeable materials at the Rule 12(b) stage without necessarily resolving disputes about such materials or accepting the truth of their contents. See 26 Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 1001 (9th Cir. 2018). The Court accordingly GRANTS Turo’s request for judicial notice as to the existence of those documents. 27 1 Court focuses its attention on the question of subject matter jurisdiction and does not reach the 2 remaining issues. 3 A. Standing 4 The Court evaluates challenges to Article III standing under Rule 12(b)(1), which governs 5 motions to dismiss for lack of subject matter jurisdiction. Maya v. Centex Corp., 658 F.3d 1060, 6 1067 (9th Cir. 2011). Rule 12(b)(1) motions may be either facial, where the inquiry is confined to 7 the allegations in the complaint, or factual, where the court is permitted to look beyond the 8 complaint to extrinsic evidence. Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2014). When a 9 defendant challenges jurisdiction “facially,” all material allegations in the complaint are assumed 10 true, and the court determines whether the factual allegations are sufficient to invoke the court’s 11 subject matter jurisdiction. Id. When a defendant makes a factual challenge “by presenting 12 affidavits or other evidence properly brought before the court, the party opposing the motion must 13 furnish affidavits or other evidence necessary to satisfy its burden of establishing subject matter 14 jurisdiction.” Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004); see also Leite, 15 749 F.3d at 1121. The court need not presume the truthfulness of the plaintiff’s allegations under 16 a factual attack. Wood v. City of San Diego, 678 F.3d 1075, 1083 n.8 (9th Cir. 2012). 17 “Article III confines the federal judicial power to the resolution of ‘Cases’ and 18 ‘Controversies.’ For there to be a case or controversy under Article III, the plaintiff must have a 19 ‘personal stake’ in the case – in other words, standing.” TransUnion LLC v. Ramirez, 594 U.S. 20 413, 423 (2021) (citation omitted). To establish standing, “(1) the plaintiff [must have] suffered 21 an injury in fact, i.e., one that is sufficiently ‘concrete and particularized’ and ‘actual or imminent, 22 not conjectural or hypothetical,’ (2) the injury is ‘fairly traceable’ to the challenged conduct, and 23 (3) the injury is ‘likely’ to be ‘redressed by a favorable decision.’ ” Bates v. United Parcel Serv., 24 Inc., 511 F.3d 974, 985 (9th Cir. 2007) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 25 560-61 (1992)). “To establish an injury in fact, a plaintiff must show that he or she suffered ‘an 26 Court or stipulation of Turo.” Dkt. No. 24 at 5. Plaintiff’s improper inclusion of a new claim for 27 breach of the implied covenant of good faith and fair dealing in the FAC fails to comply with the 1 invasion of a legally protected interest’ that is ‘concrete and particularized.’ ” In re Facebook, 2 Inc. Internet Tracking Litig., 956 F.3d 589, 597 (9th Cir. 2020) (quoting Spokeo, Inc. v. Robins, 3 578 U.S. 330, 339 (2016), as revised (May 24, 2016)). 4 “[P]laintiffs must establish a ‘line of causation’ between defendants’ action and their 5 alleged harm that is more than ‘attenuated.’ ” Maya, 658 F.3d at 1070 (quoting Allen v. Wright, 6 468 U.S. 737, 757 (1984)). Although “a causation chain does not fail simply because it has 7 several ‘links,’ provided those links are ‘not hypothetical or tenuous’ and remain ‘plausib[le],’ ” 8 id. (quoting Nat’l Audubon Soc., Inc. v. Davis, 307 F.3d 835, 849 (9th Cir. 2002)), “[w]here a 9 chain of causation ‘involves numerous third parties’ whose ‘independent decisions’ collectively 10 have a ‘significant effect’ on plaintiffs’ injuries, the Supreme Court and [the Ninth Circuit] have 11 found the causal chain too weak to support standing at the pleading stage.” Maya, 658 F.3d at 12 1070 (citing Allen, 468 U.S. at 759). “A plaintiff’s injury is ‘fairly traceable’ when there is a 13 ‘substantial likelihood’ that the defendant’s conduct caused the harm.” Baton v. Ledger SAS, 740 14 F. Supp. 3d 847, 878-79 (N.D. Cal. 2024) (quoting NRDC v. Texaco Ref. & Mktg., Inc., 2 F.3d 15 493, 505 (3d Cir. 1993)). “[W]hat matters is not the ‘length of the chain of causation,’ but rather 16 the ‘plausibility of the links that comprise the chain.’ ” Mendia v. Garcia, 768 F.3d 1009, 1012- 17 13 (9th Cir. 2014) (quoting Nat’l Audubon Soc., 307 F.3d at 849). 18 Here, Riez fails to establish a line of causation between Turo’s conduct and his harm that is 19 more than attenuated. Maya, 658 F.3d at 1070. As noted at the outset, Turo is an online peer-to- 20 peer car sharing platform that connects hosts with guests seeking to book a host’s vehicle for use. 21 Armstrong Decl. ¶ 3. Riez’s attempt to characterize the minivan as “Turo’s vehicle” is not only 22 incorrect, it is directly contradicted by Riez’s own exhibits. See FAC, Ex. O (Dkt. No. 29-14) 23 (“Turo is a digital peer-to-peer car sharing platform, where private car owners share their personal 24 vehicles with others in exchange for compensation.”). To the contrary, Turo does not own any 25 vehicles, including the minivan. See Armstrong Decl. ¶ 4; Dkt. No. 35-1 (Turo does not own or 26 maintain the vehicles that hosts list for booking on its platform.). Turo, moreover, does not have 27 responsibility for the safety of the vehicles booked on its platform. Armstrong Decl., Ex. A at 13. 1 And because Riez confuses Turo’s role in the transaction, he fails to acknowledge the 2 conduct of third parties whose independent decisions impacted his purported injuries. Riez alleges 3 that the minivan he booked through Turo contained fentanyl residue, but he did not suffer any 4 direct harm from the controlled substance. FAC at 4, 7. Rather, Riez suffered the following 5 injuries arising from the CBSA detention: loss of liberty, humiliation, emotional distress, 6 reputational harm, economic loss, and medical expenses. FAC at 18-19. The chain of causation 7 thus relies on the independent decisions of at least (1) the vehicle’s owner, or the host responsible 8 for maintaining and cleaning the minivan to be rented on the Turo platform, (2) the previous driver 9 or person in control of the minivan,4 and (3) the CBSA, a law enforcement agency unrelated to 10 Turo or the vehicle rental relationship. These absent third parties had a “significant effect” on 11 Riez’s asserted injuries, leaving the “causal chain too weak to support standing at the pleading 12 stage.” Maya, 658 F.3d at 1070. And in the end, Riez’s allegations remain too unclear to trace his 13 injuries to Turo’s purported action of allowing him to book the third-party host’s “drug- 14 contaminated vehicle” over Turo’s platform. Riez does nothing more than conclude that he 15 suffered “concrete, particularized injuries,” most clearly attributable to the actions of absent third 16 parties, without alleging how Turo contributed to these injuries. Dkt. No. 37 at 7-8. This is 17 insufficient to establish standing. 18 In an effort to make up for the absence of any alleged harm attributable to Turo’s conduct, 19 Riez asserts possible future injuries. FAC at 13. But future injuries that may never occur and 20 harms that may impact unknown third parties do not represent concrete or particular injuries 21 sufficient to assert a claim. Larson v. Trans Union, LLC, 201 F. Supp. 3d 1103, 1105 (N.D. Cal. 22 2016) (explaining that a concrete injury “is one that actually exist[s], meaning that it is real, and 23 not abstract.”) (internal citation and quotation marks omitted). Riez cannot assert standing based 24 on potential harm from Turo’s continued listing of the minivan on its platform, anticipated harm to 25 unknown Turo guests that remains “hypothetical or tenuous” and thus not actionable. Maya, 658 26 F.3d at 1070; see also FAC at 8. 27 1 Riez ultimately argues that the Court should “infer” Article III standing at the pleading 2 stage because it is “plausible” his injury can be traced to Turo after discovery. Dkt. No. 37 at 8. 3 But that argument applies the wrong standard. Article III standing must be shown at the pleading 4 stage – not proven after extensive discovery as Riez contends. Spokeo, 578 U.S. at 338 (“Where, 5 as here, a case is at the pleading stage, the plaintiff must ‘clearly . . . allege facts demonstrating’ 6 each element [of Article III standing].” (quoting Warth v. Seldin, 422 U.S. 490, 518 (1975)). Riez 7 does not bear his burden. Because he fails to state facts showing there was a substantial likelihood 8 that any act or omission by Turo caused his harm, Riez lacks standing to state any of the asserted 9 claims against Turo. 10 B. Further Leave to Amend 11 “Generally, Rule 15 advises the court that leave shall be freely given when justice so 12 requires. This policy is to be applied with extreme liberality.” Eminence Cap., LLC v. Aspeon, 13 Inc., 316 F.3d 1048, 1051 (9th Cir. 2003) (internal quotations and citations omitted). Courts may 14 deny leave to amend “only if there is strong evidence of undue delay, bad faith or dilatory motive 15 on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, 16 undue prejudice to the opposing party by virtue of allowance of the amendment, [or] futility of 17 amendment, etc.” Sonoma Cnty. Ass’n of Retired Emps. v. Sonoma Cnty., 708 F.3d 1109, 1117 18 (9th Cir. 2013) (quoting Foman v. Davis, 371 U.S. 178, 182 (1962)) (modification in original). 19 Here, Riez failed to cure deficiencies identified in the Court’s order dismissing his original 20 complaint. See Dkt. No. 24. Indeed, the FAC contains the same defective theories of purported 21 harm asserted in the original complaint and it still fails to establish standing against Turo. The 22 failure to cure deficiencies by amendment previously allowed warrants denial of further leave to 23 amend. 24 Following complete briefing of the motion to dismiss the FAC, Riez filed a motion seeking 25 leave to file a second amended complaint. Dkt. No. 39. Riez’s proposed second amended 26 complaint continues to assert the same purported harms, emphasizing the potential harm to absent 27 third-parties based on Turo’s continued listing of the minivan despite Riez’s complaints of ] Riez still fails to identify how his proposed amended pleading addresses the standing defect that 2 || underpinned the Court’s earlier dismissal order. See Dkt. Nos. 35 & 50. Riez’s proposed 3 amendment accordingly still fails as futile because it still does not demonstrate that Riez suffered 4 || an injury traceable to Turo’s conduct. Therefore, the Court declines to permit further amendment. 5 || 1. CONCLUSION 6 Because Riez fails to offer facts establishing injury in fact, and because Riez fails to 7 || establish that any injury is traceable to Turo’s conduct, Riez lacks Article HI standing to bring this 8 action against Turo. The Court therefore GRANTS Turo’s motion to dismiss for lack of subject 9 || matter jurisdiction. The Court does not reach the remaining arguments for dismissal. The Court 10 || TERMINATES all remaining motions and stipulations as moot. A separate judgment shall issue. 1] %L IT IS SO ORDERED. E 13 Dated: April 29, 2026

15 : 2 ARACELI MARTINEZ-OLGUIN = 16 United States District Judge 17

Z 18 19 20 21 22 23 24 25 26 27 28