Opinion
527861
12-31-2020
Shirley HE, Appellant, v. APPLE, INC., Respondent, et al., Defendants.
Shirley He, Clifton Park, appellant pro se. Schiff Hardin LLP, New York City (Katia Asche of counsel), for Apple, Inc., respondent.
Shirley He, Clifton Park, appellant pro se.
Schiff Hardin LLP, New York City (Katia Asche of counsel), for Apple, Inc., respondent.
Before: Egan Jr., J.P., Pritzker, Reynolds Fitzgerald and Colangelo, JJ.
MEMORANDUM AND ORDER
Colangelo, J.
Plaintiff fell victim to a scam in which individuals posing as federal tax officials telephoned her, demanded payment for unpaid taxes and directed her to make that payment by providing redemption codes from iTunes gift cards. She proceeded to purchase several thousand dollars worth of iTunes gift cards and gave the codes to the scammers. After realizing that she had been duped, plaintiff reported the matter to local police and asked for a refund from defendant Apple, Inc. and the retailers from whom she had purchased the gift cards. The retailers and Apple denied her requests, citing the policy that lost or stolen gift cards are nonrefundable.
Plaintiff then commenced this action, asserting claims for fraud, unjust enrichment and negligence against Apple, Inc. and related individuals and entities (hereinafter collectively referred to as Apple) and claims for fraud and unjust enrichment against the retailers and related individuals and entities (hereinafter collectively referred as to the retailers). Apple moved to dismiss the amended complaint following the service of an answer on behalf of Apple, Inc., while the retailers filed similar motions prior to serving an answer. Plaintiff then cross-moved for leave to serve a second amended complaint alleging a claim that Apple had engaged in deceptive business practices. Supreme Court granted the motions by Apple and the retailers and denied plaintiff's cross motion. Plaintiff appeals and, as she has settled her claims against the retailers, we focus upon her arguments regarding the claims against Apple.
We affirm. In reviewing a motion to dismiss the complaint for failure to state a cause of action (see CPLR 3211[a][7] ), a court accepts the facts as alleged in the complaint as true, affords every possible inference to the plaintiff and determines only whether the allegations fall within a cognizable claim (see Cortlandt St. Recovery Corp. v. Bonderman, 31 N.Y.3d 30, 38, 73 N.Y.S.3d 95, 96 N.E.3d 191 [2018] ; Simkin v. Blank, 19 N.Y.3d 46, 52, 945 N.Y.S.2d 222, 968 N.E.2d 459 [2012] ; Leon v. Martinez, 84 N.Y.2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511 [1994] ). Affidavits or other proof submitted by the plaintiff may be used to remedy any defect in the complaint (see Carlson v. American Intl. Group, Inc., 30 N.Y.3d 288, 298, 67 N.Y.S.3d 100, 89 N.E.3d 490 [2017] ; Leon v. Martinez, 84 N.Y.2d at 88, 614 N.Y.S.2d 972, 638 N.E.2d 511 ). Dismissal is nevertheless appropriate where a claim is premised upon "bare legal conclusions," where the alleged facts do not support "an element of the claim," or where "the factual allegations and inferences to be drawn from them do not allow for an enforceable right of recovery" ( Connaughton v. Chipotle Mexican Grill, Inc., 29 N.Y.3d 137, 141–142, 53 N.Y.S.3d 598, 75 N.E.3d 1159 [2017] [internal quotation marks and citations omitted]; see Mid–Hudson Val. Fed. Credit Union v. Quartararo & Lois, PLLC, 155 A.D.3d 1218, 1219, 64 N.Y.S.3d 389 [2017], affd 31 N.Y.3d 1090, 78 N.Y.S.3d 703, 103 N.E.3d 774 [2018] ). Applying that liberal standard here, we agree with Supreme Court that plaintiff failed to state any viable claim against Apple.
A fraud claim, which must be pleaded with particularity (see CPLR 3016[b] ; Carlson v. American Intl. Group, Inc., 30 N.Y.3d at 310, 67 N.Y.S.3d 100, 89 N.E.3d 490 ), requires allegations of "misrepresentation or concealment of a material fact, falsity, scienter by the wrongdoer, justifiable reliance on the deception and resulting injury" ( Lusins v. Cohen, 49 A.D.3d 1015, 1017, 853 N.Y.S.2d 685 [2008] [internal quotation marks and citation omitted]; accord Doller v. Prescott, 167 A.D.3d 1298, 1300, 91 N.Y.S.3d 533 [2018] ; see Ambac Assur. Corp. v. Countrywide Home Loans, Inc., 31 N.Y.3d 569, 578–579, 81 N.Y.S.3d 816, 106 N.E.3d 1176 [2018] ). Plaintiff acknowledged that Apple was not involved with the scammers and pointed to no misrepresentations by it, instead asserting only that it had profited from the gift card sales and that its policy of not issuing refunds "motivated" the fraudulent acts of the scammers. Accordingly, absent allegations of any "misstatements or misrepresentations made specifically by [Apple's] representatives to [plaintiff], as required by CPLR 3016(b)," plaintiff failed to state a claim for fraud against Apple ( Moore v. Liberty Power Corp., LLC, 72 A.D.3d 660, 661, 897 N.Y.S.2d 723 [2010], lv denied 14 N.Y.3d 713, 2010 WL 2301693 [2010] ; see Bynum v. Keber, 135 A.D.3d 1066, 1067–1068, 23 N.Y.S.3d 654 [2016] ).
"A cause of action for unjust enrichment is stated where a plaintiff shows (1) the other party was enriched, (2) at that party's expense, and (3) that it is against equity and good conscience to permit the other party to retain what is sought to be recovered" ( Doller v. Prescott, 167 A.D.3d at 1301, 91 N.Y.S.3d 533 [internal quotation marks and citations omitted]; see New York State Workers' Compensation Bd. v. Program Risk Mgt., Inc., 150 A.D.3d 1589, 1594, 55 N.Y.S.3d 790 [2017] ). The third element is the key and, although Apple profited from plaintiff's purchase of gift cards, there is nothing inherently inequitable in it making money from a legitimate transaction (see Mandarin Trading Ltd. v. Wildenstein, 16 N.Y.3d 173, 182, 919 N.Y.S.2d 465, 944 N.E.2d 1104 [2011] ; Schoch v. Lake Champlain OB–GYN, P.C., 184 A.D.3d 338, 344, 126 N.Y.S.3d 532 [2020], lv granted 35 N.Y.3d 918, 2020 WL 6865516 [2020] ; Kingston Oil Supply Corp. v. Smith, 101 A.D.3d 1569, 1570, 957 N.Y.S.2d 771 [2012] ). Plaintiff made no allegations that those profits rightly belong to her or that circumstances existed – such as Apple playing a role in her falling victim to scammers or having promised to make her whole in the event that she did – that would render it inequitable for Apple to keep them. It follows that plaintiff failed to state a claim for unjust enrichment against Apple (see Mandarin Trading Ltd. v. Wildenstein, 16 N.Y.3d at 182–183, 919 N.Y.S.2d 465, 944 N.E.2d 1104 ; DerOhannesian v. City of Albany, 110 A.D.3d 1288, 1291, 975 N.Y.S.2d 188 [2013], lv denied 22 N.Y.3d 862, 2014 WL 642724 [2014] ; Baron v. Pfizer, Inc., 42 A.D.3d 627, 630, 840 N.Y.S.2d 445 [2007] ).
Supreme Court also properly dismissed the negligence claim against Apple, which was premised upon its failure to suspend the scammers' iTunes account after learning of their conduct. "It is well established that before a defendant may be held liable for negligence it must be shown that the defendant owes a duty to the plaintiff" ( Pulka v. Edelman, 40 N.Y.2d 781, 782, 390 N.Y.S.2d 393, 358 N.E.2d 1019 [1976] ) and, even if Apple was in a position to protect plaintiff from the scammers, it would ordinarily have no duty "to control the conduct of third persons to prevent them from" harming her ( Purdy v. Public Adm'r of County of Westchester, 72 N.Y.2d 1, 8, 530 N.Y.S.2d 513, 526 N.E.2d 4 [1988] ; see Malik v. Ultraline Med. Testing, P.C., 177 A.D.3d 515, 515, 115 N.Y.S.3d 226 [2019] ). Inasmuch as plaintiff failed to allege that Apple had "actual control" over the scammers' actions or a relationship with plaintiff that obliged it to protect her from them, there are no indications of a special relationship that would create such a duty ( Hamilton v. Beretta U.S.A. Corp., 96 N.Y.2d 222, 233, 727 N.Y.S.2d 7, 750 N.E.2d 1055 [2001] ; accord Oddo v. Queens Vil. Comm. for Mental Health for Jamaica Community Adolescent Program, Inc., 28 N.Y.3d 731, 736, 49 N.Y.S.3d 358, 71 N.E.3d 946 [2017] ). To the contrary, plaintiff's own motion papers reflect that Apple made clear to purchasers that iTunes gift cards were nonrefundable, that Apple disavowed any responsibility for stolen gift cards and that Apple reserved the right, but did not assume the obligation, to close a user's iTunes account upon learning of fraudulent activity. Accordingly, as plaintiff failed to allege any facts suggesting a duty on Apple's part to protect her from the acts of the scammers, she did not state a cause of action for negligence (see Malik v. Ultraline Med. Testing, P.C., 177 A.D.3d at 515, 115 N.Y.S.3d 226 ).
Finally, Supreme Court did not abuse its discretion in denying plaintiff's cross motion for leave to serve a second amended complaint asserting a claim for deceptive business practices against Apple (see General Business Law § 349 ), as she did not attach the proposed pleading as required and failed to give any reason to believe that the claim had merit (see CPLR 3025[b] ; Curtin v. Community Health Plan, 276 A.D.2d 884, 886, 714 N.Y.S.2d 772 [2000] ). Plaintiff's remaining contentions, to the extent that they are properly before us, have been considered and found to lack merit.
Egan Jr., J.P., Pritzker and Reynolds Fitzgerald, JJ., concur.
ORDERED that the order is affirmed, without costs.