Oestreicher v. Alienware Corp.

502 F. Supp. 2d 1061, 2007 U.S. Dist. LEXIS 58616, 2007 WL 2302490
CourtDistrict Court, N.D. California
DecidedAugust 10, 2007
DocketC 07-00512 MHP
StatusPublished
Cited by16 cases

This text of 502 F. Supp. 2d 1061 (Oestreicher v. Alienware Corp.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Oestreicher v. Alienware Corp., 502 F. Supp. 2d 1061, 2007 U.S. Dist. LEXIS 58616, 2007 WL 2302490 (N.D. Cal. 2007).

Opinion

MEMORANDUM AND ORDER

MARILYN HALL PATEL, District Judge.

On December 6, 2006 Plaintiff Harry Oestreicher (“Oestreicher”) brought this *1063 action against defendant Alienware Corporation (“Alienware”) in San Francisco County Superior Court on behalf of himself and all others similarly situated in forty-nine U.S. states. Oestreicher alleges that Alienware made misrepresentations and concealed material information in its sale of certain computers which Alienware knew to be defective. On January 25, 2007 Aliénware removed the action to this court. Alienware now moves to compel arbitration of all claims asserted in Oestr-eicher’s complaint and to stay further proceedings pending arbitration. Having considered the parties’ arguments and for the reasons stated below, the court enters the following memorandum and order.

BACKGROUND 1

Oestreicher purchased a notebook computer from Alienware, via Alienware’s website, on or around June 30, 2005. Alienware is a Florida corporation with its principal place of business in Miami. In using the Alienware website to shop for and select his purchase, Alienware contends that Oestreicher necessarily encountered hyperlinks, contained in the footer of each page on the site, leading to Alien-ware’s terms and conditions for sale. Lewis Dec. ¶ 7. To place his order, on the Alienware website’s final checkout page, Oestreicher had to click a “Place Order” button. Id. ¶ 8. To the left of this button the following text appeared: “By , clicking ‘Place Order,’ you confirm that you have read and agree to the Customer Terms and Conditions Agreement” (emphasis in original). By clicking on “Customer Terms and Conditions Agreement,” Oestreicher could access the text of this agreement. Id., Exh. B. However, orders could be placed whether or not the user had actually accessed and read the agreement; the page merely required the user to acknowledge he or she had done so in order to complete -the transaction. Oestreicher claims he does not recall accessing or viewing the Terms and Conditions.

In making his purchase from Alienware, Oestreicher therefore allegedly agreed to Alienware’s standard terms and conditions for gale agreement. For the purposes of this motion, Oestreicher does not dispute that the terms of the sale agreement were in accord with those now before the court. The sale agreement contained the following arbitration clause including a waiver of the right to pursue class actions:

Binding Arbitration. You and Alien-ware agree that any claim, dispute, or controversy, whether in contract, tort, or otherwise, and whether preexisting, present or future, and including statutory, common law, intentional tort and equitable claims (“Dispute”) against Alienware ... arising from, in connection with or relating to this Agreement, its interpretation, or the breach, termination or validity thereof, the relationships which result from this Agreement ..., Alienware’s advertising or any related purchase SHALL BE RESOLVED EXCLUSIVELY AND FINALLY BY BINDING ARBITRATION ADMINISTERED BY THE NATIONAL ARBITRATION FORUM .... YOU UNDERSTAND THAT IN THE ABSENCE OF THIS PROVISION, YOU WOULD HAVE HAD A RIGHT TO LITIGATE DISPUTES THROUGH A COURT, INCLUDING THE RIGHT TO LITIGATE CLAIMS ON A CLASS-WIDE OR CLASS-ACTION BASIS, AND THAT YOU HAVE EXPRESSLY AND KNOWINGLY WAIVED THOSE RIGHTS AND AGREED TO RESOLVE ANY DISPUTES THROUGH BINDING ARBITRATION IN ACCORDANCE WITH THIS SECTION.

*1064 Lewis Dec., Exh. A, Agreement ¶ 11. ■ The sale agreement also contained the following choice of law clause: “Governing law. This Agreement and any sales hereunder shall be governed by the laws of the state of Florida, without regard to conflicts of laws principles, and excluding the United Nations Convention on the International Sale of Goods.” Lewis Dec., Exh. A ¶ 13 (emphasis in original).

Oestreicher paid $4,149 for his purchase. Six months later, Oestreicher’s Alienware notebook overheated and shut down and has not worked since. Complt. ¶ 18. Oestreicher alleges that Alienware made misrepresentations and concealed material information in its sale of certain computers which Alienware knew to be defective. See id. ¶¶ 2, 15, 17, 31-36. Oestreicher asserts six causes of action: (1) unfair, deceptive and unlawful business practices in violation of California’s Unfair Competition Law, Bus. & Prof.Code sections 17200 et seq., (2) untrue and misleading advertising in violation of Cal. Bus. & Prof.Code sections 17500 et seq., (3) violation of the California Legal Remedies Act (“CLRA”), Cal. Civ.Code sections 1750 et seq., (4) breach of express warranties in violation of Cal. Comm.Code section 2313, (5) breach of implied warranties in violation of Cal. Comm.Code section 2314, and (6) unjust enrichment. Oestreicher filed this case on behalf of himself and all other similarly situated residents of California and forty-eight other U.S. states who purchased Alienware notebook computers of the Area 51 product line: models Area-51m 5550, 5700, 5750, 7500 and 7700.

On February 1, 2007 Alienware brought the present motion to stay proceedings and to compel arbitration pursuant to the arbitration clause. Alienware argues that the arbitration clause’s validity, in accordance with the choice of law clause, must be determined under Florida law. On May 1, 2007, after all briefing related to this motion was complete but before oral argument, Oestreicher filed his First Amended Complaint (“FAC”). The proposed class as defined in the FAC is limited to California residents. FAC ¶ 29. LEGAL STANDARD

The Federal Arbitration Act (“FAA”), 9 U.S.C. sections 1-16, requires federal courts to enforce arbitration agreements and to stay any litigation that contravenes such agreements. Arbitration is a matter of contact, and the court cannot require a party to arbitrate a dispute unless the party has agreed to do so. United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960). Accordingly, the court’s role under the FAA is limited to (1) determining whether a valid agreement to arbitrate exists and, if it does, (2) deciding whether the agreement encompasses the dispute at issue. 9 U.S.C. § 4; Simula, Inc. v. Autoliv, Inc., 175 F.3d 716, 719-20 (9th Cir.1999).

Despite the “liberal federal policy favoring arbitration agreements,” Green Tree Fin. Corp. v. Randolph, 531 U.S. 79, 81, 121 S.Ct. 513, 148 L.Ed.2d 373 (2000), state law still has a role to play. In interpreting 9 U.S.C. section 2, the Supreme Court has held that “state law, whether of legislative or judicial origin, is applicable if

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Bluebook (online)
502 F. Supp. 2d 1061, 2007 U.S. Dist. LEXIS 58616, 2007 WL 2302490, Counsel Stack Legal Research, https://law.counselstack.com/opinion/oestreicher-v-alienware-corp-cand-2007.