Masry v. Lowe's Companies, Inc.
Opinion
1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 OMAR MASRY, et al., Case No. 25-cv-02959-CRB
9 Plaintiffs,
ORDER GRANTING MOTION TO 10 v. REMAND
11 LOWE'S COMPANIES, INC., et al., 12 Defendants.
13 This is a class action lawsuit regarding an alleged non-disparagement clause in the 14 terms of use of Lowe’s website, Lowes.com. Before the Court are two motions: a motion 15 to remand and a motion to dismiss. Plaintiffs Omar Masry and Elliot Mass, on behalf of 16 themselves and others similarly situated, move to remand this action to state court. Docket 17 Nos. 26, 32. Defendants Lowe’s Companies, Inc. and Lowe’s Home Centers, LLC move 18 to dismiss Plaintiffs’ first amended complaint (FAC). Docket No. 13. Under Civil Local 19 Rule 7-1(b), the Court finds the matter suitable for disposition on the pleadings. For the 20 following reasons, the Court GRANTS Plaintiffs’ motion to remand and DENIES AS 21 MOOT Defendants’ motion to dismiss. 22 I. BACKGROUND 23 A. Factual Background 24 In their FAC, Plaintiffs allege that a clause in the terms of use (“Terms”) of 25 Lowes’s website violates California Civil Code Sections 1670.8(a)(1) and 1670.8(a)(2). 26 Plaintiffs take issue a provision of the Terms prohibiting users from posting content that: 27 [D]efame[s], misrepresent[s] or contain[s] disparaging remarks about Lowe’s Organization or its products, or other people, 1 Docket No. 1-10 at 7. 2 The relevant portion of Section 1670.8 states: 3 (a)(1) A contract or proposed contract for the sale or lease of consumer goods or services may not include a provision waiving 4 the consumer's right to make any statement regarding the seller or lessor or its employees or agents, or concerning the 5 goods or services. 6 (2) It shall be unlawful to threaten or to seek to enforce a provision made unlawful under this section, or to otherwise 7 penalize a consumer for making any statement protected under this section. 8 9 Cal. Civ. Code § 1670.8 (emphasis added). 10 B. Procedural Background 11 On November 7, 2024, this Court granted Plaintiffs’ motion to remand in 24-cv- 12 750. Masry v. Lowe's Companies, Inc., No. 24-CV-00750-CRB, 2024 WL 4730423, at *1 13 (N.D. Cal. Nov. 7, 2024). 14 On March 31, 2025, Defendants removed the instant case from Alameda County 15 Superior Court. Dkt. 1. On April 7, 2025, Defendants moved to dismiss Plaintiffs’ 16 complaint. Dkt. 13. On April 29, 2025 and May 2, 2025, Plaintiffs moved to remand. 17 Dkts. 26 and 32. 18 II. LEGAL STANDARD 19 “Federal courts are courts of limited jurisdiction,” “possess[ing] only that power 20 authorized by Constitution and statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 21 U.S. 375, 377 (1994). Accordingly, “a removed case in which the plaintiff lacks Article III 22 standing must be remanded to state court under § 1447(c).” Polo v. Innoventions Int’l, 23 LLC, 833 F.3d 1193, 1196 (9th Cir. 2016). 24 To establish standing under Article III of the Constitution, Plaintiffs must establish 25 the following elements: 26 1. “The plaintiff must have suffered an injury in fact” that is “concrete and 27 particularized,” and “actual or imminent, not conjectural or hypothetical,” 1 2. “There must be a causal connection between the injury and the conduct 2 complained of,” and 3 3. “It must be likely, as opposed to merely speculative, that the injury will be 4 redressed by a favorable decision.” 5 Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992) (internal citations omitted). 6 Cases implicating the First Amendment right to free speech face a “relaxed standing 7 analysis.” Canatella v. California, 304 F.3d 843, 853 n.11 (9th Cir. 2002). However, 8 “[e]ven in the First Amendment context, a plaintiff must show a credible threat of 9 enforcement.” Italian Colors Rest. v. Becerra, 878 F.3d 1165, 1171 (9th Cir. 2018). To 10 determine whether Plaintiffs face a credible threat in the pre-enforcement context, the 11 Court evaluates: “1) the likelihood that the law will be enforced against the plaintiff; 2) 12 whether the plaintiff has shown, ‘with some degree of concrete detail,’ that she intends to 13 violate the challenged law; and 3) whether the law even applies to the plaintiff.” Id. at 14 1171–72 (quoting Lopez v. Candaele, 630 F.3d 775, 786 (9th Cir. 2010)). 15 III. DISCUSSION 16 Remand is proper because Plaintiffs have not established an injury-in-fact for two 17 reasons. 18 First, Plaintiffs have not alleged that they intend to violate the challenged provision 19 “with some degree of concrete detail.” Id. (internal citation omitted). “[P]re-enforcement 20 plaintiffs who fail[] to allege a concrete intent to violate the challenged law [can]not 21 establish a credible threat of enforcement.” Lopez, 630 F.3d at 787. Where “[t]here is 22 nothing in the Complaint suggesting plaintiffs have left comments that would violate the 23 Terms, that they intend to leave any comment that would violate the Terms in the future, or 24 even that they intend to use the Site again, nor has [Lowe’s] evinced any intent to take any 25 action with regard to the Terms,” Plaintiffs fail to establish an injury-in-fact for Article III 26 standing. O’Donnell v. Crocs Retail, LLC, No. 2:24-CV-02726-SVW-PD, 2024 WL 27 3834704, at *4 (C.D. Cal. Aug. 15, 2024) (internal citation omitted). Here, Plaintiffs do 1 Terms. Because Plaintiffs do not allege an intent to violate the challenged provision with 2 “some degree of concrete detail,” Plaintiffs have not articulated an injury-in-fact. 3 Canatella, 304 F.3d at 853 n. 11. 4 Second, contrary to Defendants’ argument, Plaintiffs have not alleged that they 5 have censored themselves in response to a credible threat of enforcement. As the Court 6 previously noted, “allegations that Plaintiffs are self-censoring in fear of violating the 7 Terms” may support a finding of an injury-in-fact. O’Donnell, 2024 WL 3834704, at *4. 8 Defendants argue that Plaintiffs have so alleged by stating the following: 9 The Terms also threaten to suspend or terminate any user’s right to use the Sites, at Lowe’s sole and absolute discretion, if the 10 user makes any statement that Lowe’s deems “harmful to Lowe’s interests.” Plaintiffs are aware of the offending Terms 11 described above, including the threat of enforcement through the potential disabling off access to the Sites, and believe that their 12 ability to make statements about Lowe’s has been limited as a result of Lowe’s’ threats to enforce the unlawful provisions 13 contained in its Terms, thus foreseeably causing unlawful self- censorship of Plaintiffs and other Lowe’s customers. Under 14 estoppel principles, Defendants cannot be heard to complain that certain customers muzzled themselves through self-censorship, 15 as this is the exact dynamic that Section 1670.8 is intended to remedy. 16 17 FAC ¶ 11. However, these allegations do not demonstrate that Plaintiffs have engaged in 18 any specific act of “self-censor[ship] in fear of violating the Terms.” O’Donnell, 2024 WL 19 3834704, at *4. Plaintiffs do not allege that they have, in fact, “muzzled themselves.” 20 FAC ¶ 11. Rather, Plaintiffs allege that the Terms are designed to limit “their ability to 21 make statements about Lowe’s.” Id. Thus, Plaintiffs have not alleged any acts of self- 22 censorship in support of a finding of an injury-in-fact. 23 Therefore, Plaintiffs have not established Article III standing. 24 IV.
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