Kerr v. Zacks Investment Research, Inc. et al

MOTION to Dismiss for Failure to State a Claim

S.D. Cal.October 20, 2016

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A Limited Liability Partnership Including Professional Corporations SHANNON Z. PETERSEN, Cal. Bar No. 211426 spetersen@sheppardmullin.com LISA S. YUN, Cal. Bar No. 280812 lyun@sheppardmullin.com 12275 El Camino Real, Suite 200 San Diego, CA 92130-2006 Telephone: 858.720.8900 Facsimile: 858.509.3691 BURKE, WARREN, MACKAY & SERRITELLA, P.C. DANIELLE J. GOULD pro hac vice dgould@burkelaw.com SARA YOUN CHOH pro hac vice schoh@burkelaw.com 330 North Wabash Avenue, 22nd Floor Chicago, Illinois 60611 Telephone: 312.840.7000 Facsimile: 312.840.7900 Attorneys for Defendant ZACKS INVESTMENT RESEARCH, INC. UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA JOHN KERR, individually and on behalf of all others similarly situated, Plaintiff, v. ZACKS INVESTMENT RESEARCH, INC., an Illinois corporation, and DOES 1 through 50, inclusive, Defendants. Case No. 16-cv-1352 GPC (BLM) CLASS ACTION DEFENDANT ZACKS INVESTMENT RESEARCH, INC.'S NOTICE OF MOTION AND MOTION TO DISMISS PURSUANT TO RULE 12(b)(6) Date: December 9, 2016 Time: 1:30 p.m. Courtroom 2D (2nd Floor - Schwartz) Suite 2190 Hon. Gonzalo P. Curiel Case 3:16-cv-01352-GPC-BLM Document 31 Filed 10/20/16 Page 1 of 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TO THE HONORABLE COURT, ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on December 9, 2016, at 1:30 p.m., in Courtroom 2D of the United States District Court for the Southern District of California, located at 221 West Broadway, San Diego, California 92101, Defendant Zacks Investment Research, Inc. (“ZIR”) will and hereby does move to dismiss the Plaintiffs’ First Amended Complaint (Dkt. 24) pursuant to Federal Rules of Civil Procedure Rule 12(b)(6) for failure to state a claim upon which relief can be granted. As set forth in the accompanying Memorandum of Points and Authorities, there is good cause for the relief requested. The First Amended Complaint (“FAC”) fails to state a claim for violations of the TCPA (Count I) because Plaintiffs fail to sufficiently allege that the alleged calls to their cell phones were made using an automatic telephone dialing system and because Plaintiffs Edward Li, Tim Barnard, and Kenneth Curtis fail to allege facts sufficient to put ZIR on notice of any TCPA claim. The FAC also fails to state a claim for violation of the California Invasion of Privacy Act (Counts II and III) because Plaintiff John Kerr does not allege that ZIR recorded or assisted in the recording of any calls to his cell phone and because the claim is insufficiently pled with respect to Plaintiffs Li, Barnard, and Curtis. This Motion is based upon this Notice of Motion and Motion to Dismiss, the Memorandum of Points and Authorities, the pleadings, records, and papers on file in this action, and such further evidence and argument as the Court may allow. Case 3:16-cv-01352-GPC-BLM Document 31 Filed 10/20/16 Page 2 of 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: October 20, 2016 BURKE, WARREN, MACKAY & SERRITELLA, P.C. By s/Danielle J. Gould DANIELLE J. GOULD Attorneys for Defendant ZACKS INVESTMENT RESEARCH, INC. Email: dgould@burkelaw.com Case 3:16-cv-01352-GPC-BLM Document 31 Filed 10/20/16 Page 3 of 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A Limited Liability Partnership Including Professional Corporations SHANNON Z. PETERSEN, Cal. Bar No. 211426 spetersen@sheppardmullin.com LISA S. YUN, Cal. Bar No. 280812 lyun@sheppardmullin.com 12275 El Camino Real, Suite 200 San Diego, California 92130-2006 Telephone: 858.720.8900 Facsimile: 858.509.3691 BURKE, WARREN, MACKAY & SERRITELLA, P.C. DANIELLE J. GOULD, pro hac vice dgould@burkelaw.com SARA YOUN CHOH, pro hac vice schoh@burkelaw.com 330 North Wabash Avenue, 22nd Floor Chicago, Illinois 60611 Telephone: 312.840.7000 Facsimile: 312.840.7900 Attorneys for Defendant ZACKS INVESTMENT RESEARCH, INC. UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA JOHN KERR, individually and on behalf of all others similarly situated, Plaintiff, v. ZACKS INVESTMENT RESEARCH, INC., an Illinois corporation; and DOES 1 through 50, inclusive, Defendants. Case No. 16-cv-1352 GPC BLM MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS PURSUANT TO RULE 12(b)(6) Date: December 9, 2016 Time: 1:30 p.m. Courtroom 2D (2nd Floor - Schwartz) Suite 2190 Hon. Gonzalo P. Curiel Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 1 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -i- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS TABLE OF CONTENTS Page I. INTRODUCTION ............................................................................................. 1 II. BACKGROUND ............................................................................................... 2 A. Procedural History .................................................................................. 2 B. Allegations by Plaintiff Kerr ................................................................... 3 III. LEGAL STANDARD ....................................................................................... 4 IV. ARGUMENT .................................................................................................... 5 A. PLAINTIFFS FAIL TO STATE A CLAIM FOR VIOLATIONS OF THE TCPA (COUNT I). ................................................................... 5 1. Count I Fails with Respect to All Plaintiffs Because They Fail to Sufficiently Allege that the Calls Were Made Using ATDS. ........................................................................................... 5 2. Count I Fails with Respect to Plaintiffs Li, Barnard, and Curtis Because They Also Fail to Allege Facts Sufficient to Put ZIR on Notice of Any TCPA Claim. ................................. 8 B. PLAINTIFF KERR FAILS TO STATE A CLAIM FOR VIOLATIONS OF THE CALIFORNIA INVASION OF PRIVACY ACT AGAINST ZIR (COUNT II). .................................... 10 C. PLAINTIFFS LI, BARNARD, AND CURTIS FAIL TO STATE A CLAIM FOR VIOLATIONS OF THE CALIFORNIA INVASION OF PRIVACY ACT AGAINST ZIR (COUNT III). ........ 14 V. CONCLUSION ............................................................................................... 16 Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 2 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -ii- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS TABLE OF AUTHORITIES Page Cases Abbas v. Selling Source, LLC No. 09 CV 3413, 2009 WL 4884471 (N.D. Ill. Dec. 14, 2009) ..................... 10, 16 ACA Int’l v. FCC Case No. 15-1211 ................................................................................................... 8 Ashcroft v. Iqbal 556 U.S. 662 (2009) ..................................................................................... 4, 5, 10 Banks v. Green Tree Servicing, LLC No. 14-cv-2825, 2015 WL 1058124 (N.D. Ill. Mar. 5, 2015) ................................ 6 Bell Atlantic Corp. v. Twombly 550 U.S. 544 (2007) ............................................................................................. 14 Davis v. Powell 901 F. Supp. 2d 1196 (S.D. Cal. 2012) .................................................................. 9 Duguid v. Facebook, Inc. Case No. 15-cv-00985-JST, 2016 WL 1169365 (N.D. Cal. Mar. 24, 2016) ....................................................................................................................... 8 In re Facebook Internet Tracking Litig. 140 F. Supp. 3d 922 (N.D. Cal. 2015) .................................................................. 15 Flores v. Adir Int’l, LLC No. CV 15-00076-AB, 2015 WL 4340020 (C.D. Cal. July 15, 2015) .............. 5, 9 Flores v. EMC Mortg. Co. 997 F. Supp. 2d 1088 (E.D. Cal. 2014) .................................................................. 8 Giovanniello v. ALM Media, LLC 726 F.3d 106 (2d Cir. 2013) ................................................................................. 15 Gragg v. Orange Cab Co., Inc. 942 F. Supp. 2d 1111 (W.D. Wash. 2013) ......................................................... 6, 7 Huricks v. Shopkick, Inc. No. C-14-2464 MMC, 2014 WL 3725344 (N.D. Cal. July 24, 2014) ................... 6 Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 3 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -iii- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS Johansen v. Vivant, Inc. No. 12 C 7159, 2012 WL 6590551 (N.D. Ill. Dec. 18, 2012) .......................... 6, 10 Jones v. FMA Alliance Ltd. 978 F. Supp. 2d 84 (D. Mass. 2013) ....................................................................... 6 Kane v. Delong No. CV 13-05021-KAW, 2014 WL 894587 (N.D. Cal. Mar. 4, 2014) ............................................................................................................... 13, 14 Kearney v. Salomon Smith Barney, Inc. 137 P.3d 914 (Cal. 2006) ...................................................................................... 12 Kemety v. Bank of America, Inc. No. 10cv1910-LAB (RBB), 2011 WL 4566441 (S.D. Cal. Sept. 30, 2011) ..................................................................................................................... 15 Kimmel v. Golan 793 P.2d 524 (Cal. 1990) ...................................................................................... 11 Maghen v. Quicken Loans Inc. 94 F. Supp. 3d 1141 (C.D. Cal. 2015) .................................................................. 12 McKenna v. WhisperText No. 5:14-cv-00424-PSG, 2014 WL 4905629 (N.D. Cal. Sept. 29, 2014) ....................................................................................................................... 6 Meyer v. Portfolio Recovery Assocs., LLC 707 F.3d 1036 (9th Cir. 2012) ................................................................................ 5 Montali v. Catanzariti 191 Cal. App. 3d 96 (1987) .................................................................................. 15 Robertson v. Dean Witter Reynolds, Inc. 749 F.2d 530 (9th Cir. 1984) .................................................................................. 4 Rutman Wine Co. v. E. & J. Gallo Winery 829 F. 2d 729 (9th Cir. 1987) ............................................................................... 10 Star v. Baca 652 F.3d 1202 (9th Cir. 2011), cert. denied, 132 S. Ct. 2101 ................................ 5 Sunbelt Rentals, Inc. v. Victor 43 F. Supp. 3d 1026 (N.D. Cal. 2014) .................................................................. 15 Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 4 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -iv- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS Vartanian v. VW Credit, Inc. No. 2:11-cv-10776-SVW-RZ, 2012 WL 12326334 (C.D. Cal. Feb. 22, 2012) ......................................................................................................... 13, 15 Vera v. O’Keefe 791 F. Supp. 2d 959 (S.D. Cal. 2011) .................................................................. 11 Warden v. Kahn 99 Cal. App. 3d 805 (Cal. Ct. App. 1979) ............................................................ 11 Wynn v. Nat’l Broadcasting Co. 234 F. Supp. 2d 1067 (C.D. Cal. 2002) .................................................................. 7 Statutes 28 U.S.C. § 1658(a) ............................................................................................................... 15 47 U.S.C. § 227(a)(1) .......................................................................................................... 5, 8 § 227 et seq. ............................................................................................................ 1 California Code of Civil Procedure § 340 ..................................................................................................................... 15 § 431.30(d) .............................................................................................................. 3 California Penal Code § 31 ....................................................................................................................... 11 § 630, et seq. ........................................................................................................... 1 § 632.7 ............................................................................................................ 10, 13 § 632.7(a) (West 2016) ......................................................................................... 11 § 637.2(a) (West 2016) ......................................................................................... 11 Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 5 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -1- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS I. INTRODUCTION In his original complaint, Plaintiff John Kerr alleged direct liability claims against defendant Zacks Investment Research, Inc. (“ZIR”) pursuant to the Telephone Consumer Protection Act (“TCPA”) under 47 U.S.C. § 227 et seq. and California Penal Code § 630, et seq. (the “CA Privacy Act”). Specifically, Kerr alleges that an outbound sales call was made to his cellular telephone using an automatic telephone dialing system (“ATDS”) without his prior express written consent in violation of the TCPA, and that the telephone call was recorded in violation of the CA Privacy Act. After learning that ZIR did not make the outbound call at issue, Kerr filed the First Amended Complaint (the “FAC”) alleging that ZIR is vicarious liable under the TCPA for the outbound call which was made by defendant Response North. Kerr’s TCPA claim fails for pleading deficiencies, specifically that he conclusorily alleges on information and belief that Response North called him using ATDS even though his own allegations (e.g., that he only received one phone call from a live representative) tend to negate the claim that an ATDS was used. Kerr also continues to assert a CA Privacy Act claim against ZIR, and now adds to that claim the allegation that an inbound call that Kerr made to another defendant was recorded without proper notice and consent. With both the outbound and inbound calls, however, Kerr specifically alleges that someone other than ZIR recorded the telephone calls and otherwise alleges no facts to support that ZIR in any way assisted with the recording of any call. These pleading deficiencies subject Kerr’s claims against ZIR to dismissal. In addition to the adjustments to Kerr’s allegations, the FAC adds three new Plaintiffs identified only as Edward Li, Tim Barnard, and Kenneth Curtis, each living somewhere in San Diego County. These are the only “facts” alleged by these Plaintiffs. Otherwise, in an attempt to state a claim under the TCPA, these Plaintiffs Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 6 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -2- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS conclusorily allege that one or maybe more telephone calls were made by ZIR to them on their cell phones using ATDS sometime in the last four years and without their express written consent. As with Kerr, these new Plaintiffs’ allegations, based on information and belief, that ATDS was used to call them are insufficiently pled. Moreover, their claims fail for additional pleading deficiencies. While the following facts are within their control, Li, Barnard, and Curtis provide no date or even time frame for these alleged calls, no context for these calls (i.e., what product or information they signed up for with ZIR, if any), no telephone number (or partial number) called, and no other identifying information. Taken together, the failure to plead this information fails to put ZIR on notice of any TCPA claim. These new Plaintiffs also assert claims pursuant to the CA Privacy Act alleging on information and belief that ZIR recorded any phone calls without the requisite notice and consent. Li, Barnard, and Curtis’ allegations on this point are entirely speculative and seem to be thrown in with the TCPA claim just in case any call might have been recorded. Moreover, the limitations period for a claim under the CA Privacy Act is one year, yet Li, Barnard, and Curtis simply allege that ZIR called them sometime within the last four years. Li, Barnard, and Curtis’ speculative allegations are insufficient to state a claim under the CA Privacy Act, and/or to support that their claims are not otherwise barred by the applicable statute of limitations. For these various reasons, this Court should dismiss the FAC in its entirety. II. BACKGROUND A. Procedural History On May 6, 2016, Kerr filed a complaint in San Diego Superior Court alleging violations of the TCPA and the CA Privacy Act. [Dkt. 1-2.] Kerr purported to act on behalf of two putative classes: the “TCPA Class” and the “Privacy Act Class.” [Id.] ZIR answered the original complaint on June 3, 2016 generally denying Kerr’s Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 7 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -3- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS allegations pursuant to California Code of Civil Procedure section 431.30(d) and asserting a number of affirmative defenses. [Dkt. 2.] On June 3, 2016, ZIR filed its Notice of Removal. [Dkt. 1.] On September 1, 2016, Kerr moved for leave to file a First Amended Complaint and the Court granted Kerr’s motion on September 29, 2016. [Dkts. 19, 23.] The FAC adds four new parties against which Kerr asserts claims: (1) National Marketing Resources, LLC (“NMR”); (2) Paradigm Direct LLC (“Paradigm”); (3) Paradigm Direct Marketing, LLC (“Paradigm Marketing”); and (4) Response North. [Dkt. 24 ¶¶ 6-8, 10.] The FAC also adds three new Plaintiffs seeking to assert separate alleged claims against ZIR under the TCPA and the CA Privacy Act: (1) Edward Li; (2) Tim Barnard; and (3) Kenneth Curtis. [Id. at ¶¶ 2-4, 49-53, 60-63.] In the FAC, Plaintiffs purport to act on behalf of three putative classes: (1) the “TCPA Class;” (2) the “Paradigm Privacy Class;” and (3) the “Zacks Privacy Class.” [Id. at ¶¶ 40-43.] B. Allegations by Plaintiff Kerr After pleading only bare-bones allegations in the original complaint, Kerr now alleges that on or about December 15, 2015 he saw a television commercial that advertised a book published by ZIR. [Dkt. 24 at ¶ 15.] Kerr called a toll-free telephone number that appeared on the commercial and placed an order for the book. [Id.] Kerr alleges “on information and belief that NMR, Paradigm, Paradigm Marketing, and/or Response North recorded [the telephone call] without notifying Kerr that the communications were being recorded and without obtaining Kerr’s consent.” [Id. at ¶ 38.] Kerr makes no allegations that ZIR recorded or assisted in the recording of this telephone call. [See generally id.] Thereafter, on or about February 2, 2016, Kerr alleges he received a telephone call on his cell phone and spoke with a live sales representative. [Id. at ¶ 16.] Kerr alleges that he believed the call was made to him by ZIR. [Id.] After the filing of the original complaint, Kerr learned that ZIR did not make the call to him and now alleges on information and belief that the February 2, 2016 call to his cell phone was Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 8 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS initiated by NMR, Paradigm, Paradigm Marketing and/or Response North. [Id. at ¶¶ 17-22.] Although ZIR did not make the call, Kerr conclusorily alleges that NMR, Paradigm, Paradigm Marketing and/or Response North acted as an agent of ZIR or pursuant to the apparent authority of ZIR, and/or that ZIR ratified the actions of NMR, Paradigm, Paradigm Marketing and/or Response North. [Id. at ¶¶ 22-23.] Kerr further alleges that this outbound telephone call was also recorded by “NMR, Paradigm, Paradigm Marketing, and/or Response North,” but again does not allege that ZIR recorded or assisted in the recording of this telephone call. [Id. at ¶ 38.] Allegations by Plaintiffs Li, Barnard, and Curtis With respect to the three new Plaintiffs, Li, Barnard, and Curtis, the FAC provides only their names and identifies them as living in San Diego County. [Id. at ¶¶ 2-4.] The new Plaintiffs otherwise allege on information and belief and in a conclusory manner (1) that each received one or more telephone advertising/marketing calls on a cellular telephone from ZIR [id. at ¶¶ 24-26, 33]; (2) made via an ATDS [id. at ¶ 29]; and (3) which was recorded by ZIR without obtaining their consent [id. at ¶ 39]. In addition to these conclusory allegations made on information and belief, Li, Barnard, and Curtis allege they did not provide the requisite consent to be called on their cellular phones. [Id. at ¶ 36.] Li, Barnard, and Curtis assert claims against ZIR under the TCPA and the CA Privacy Act. [Id., Count I, III.] III. LEGAL STANDARD “A complaint may be dismissed as a matter of law for one of two reasons: (1) lack of a cognizable legal theory or (2) insufficient facts under a cognizable legal claim.” Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 534 (9th Cir. 1984) (citing 2A J. MOORE, MOORE’S FEDERAL PRACTICE ¶ 12.08 at 2271 (2d ed. 1982)). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 9 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -5- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS “[B]are assertions amount[ing] to nothing more than a formulaic recitation of the elements” of a claim “are not entitled to be assumed true.” Id. at 681 (internal quotations and citations omitted). “[T]o be entitled to the presumption of truth, allegations in a complaint or counterclaim may not simply recite the elements of a cause of action, but must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” Star v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011), cert. denied, 132 S. Ct. 2101, 182 L.E.2d 882 (2012). Additionally, “the factual allegations that are taken as true must plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation.” Id. IV. ARGUMENT A. PLAINTIFFS FAIL TO STATE A CLAIM FOR VIOLATIONS OF THE TCPA (COUNT I). 1. Count I Fails with Respect to All Plaintiffs Because They Fail to Sufficiently Allege that the Calls Were Made Using ATDS. “The three elements of a TCPA claim are: (1) the defendant called a cellular telephone; (2) using an automatic telephone dialing system; (3) without the recipient’s prior express consent.” Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d 1036, 1043 (9th Cir. 2012) (citing 47 U.S.C. § 227(b)(1)). An ATDS is “equipment that has the capacity – (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” 47 U.S.C. § 227(a)(1). Simply stating that a defendant used ATDS or quoting or paraphrasing the definition of ATDS is insufficient to state a claim for relief under the TCPA. See Flores v. Adir Int’l, LLC, No. CV 15-00076-AB (PLAx), 2015 WL 4340020, at *3 (C.D. Cal. July 15, 2015) (“Without more, Plaintiff’s conclusory allegation that Defendant used an ATDS is little more than speculation, Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 10 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -6- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS and cannot support a claim for relief under the TCPA.”); Huricks v. Shopkick, Inc., No. C-14-2464 MMC, 2014 WL 3725344, at *2 (N.D. Cal. July 24, 2014) (“Plaintiffs fail to cite any authority holding that simply quoting or paraphrasing the statutory definition of an ATDS suffices to state a claim, and, indeed, the cases on which plaintiffs rely expressly hold that such conclusory allegations are insufficient.”); McKenna v. WhisperText, No. 5:14-cv-00424-PSG, 2014 WL 4905629, at *2 (N.D. Cal. Sept. 29, 2014) (“claim that a defendant used an ATDS must be more than just conclusory”). Plaintiffs allege on information and belief that the calls purportedly made to their cellular telephones were made using ATDS. Their conclusory allegation does little more than paraphrase the statutory definition of TCPA. [Dkt. 24 ¶¶ 29-30.] However, such bare allegations on information and belief that defendants used ATDS are insufficient to state a claim under the TCPA. See, e.g., Jones v. FMA Alliance Ltd., 978 F. Supp. 2d 84, 87 (D. Mass. 2013) (finding allegation on information and belief that defendant used ATDS was insufficient to state TCPA claim); Banks v. Green Tree Servicing, LLC, No. 14-cv-2825, 2015 WL 1058124, at *5 (N.D. Ill. Mar. 5, 2015) (dismissing TCPA claim because plaintiff failed to allege facts indicating why she believed defendant used ATDS). Rather, well-pled allegations regarding the use of ATDS include at least some allegations as to the content of the message, the context in which it was received, and the existence of similar messages to raise an inference that ATDS was used. See Gragg v. Orange Cab Co., Inc., 942 F. Supp. 2d 1111, 1114 (W.D. Wash. 2013) (noting that well- pled allegations of an ATDS include allegations as to the content of the message, the context in which it was received, and the existence of similar messages to raise an inference that ATDS was used); Johansen v. Vivant, Inc., No. 12 C 7159, 2012 WL 6590551, at *3 (N.D. Ill. Dec. 18, 2012) (requiring a plaintiff to plead facts about the context and content of the calls is not unduly burdensome as it only requires him Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 11 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -7- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS to plead facts easily available to him on the basis of personal knowledge and experience). Li, Barnard, and Curtis plead absolutely no facts regarding the context or the content of the calls purportedly made by ZIR. Their allegation that the use of ATDS is “common” in the “telemarketing industry” is wholly conclusory and they allege no facts supporting their claimed belief that ATDS was used to make the calls to their cell phones. [Dkt. 24 ¶ 27.] See Wynn v. Nat’l Broadcasting Co., 234 F. Supp. 2d 1067, 1095-96 (C.D. Cal. 2002) (finding plaintiffs’ allegations of industry-wide practice of age discrimination unsupported by facts were solely the subjective belief of plaintiffs and insufficient to support a claim under the ADEA that an unlawful discriminatory practice actually existed). Also irrelevant is their allegation that a job posting for the position of “telemarketing manager” (printed as of May 3, 2016), [Dkt. 24-5], requires an understanding of “automated dialing technology” [Dkt. 24 ¶ 28], because understanding technology and using technology are not one in the same. This job description does not state that ATDS was ever used by ZIR, [id.], and it certainly does not support that it was used to make any calls to the cell phones of Li, Barnard, and Curtis. Moreover, given that the job description was printed in May 2016, and Li, Barnard, and Curtis make no allegation as to when any calls were made to them except that they were made sometime within the last four years, there is no basis for these Plaintiffs to rely on the job description to argue support for the conclusory allegation that any call was made using ATDS. Like the other plaintiffs, Kerr also improperly relies on unsupported allegations made on information and belief, paraphrasing the statutory definition of ATDS and the general use of ATDS in the telemarketing industry. [Id. at ¶¶ 27-28, 30.] Furthermore, while Kerr alleges some facts regarding the context and content of the call made to his cellular telephone, these facts tend to support the inference that the call was a personal or individual response through human agency rather than an automated interaction. See Gragg, 942 F. Sup. 2d at 1114. For example, Kerr pleads Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 12 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -8- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS the existence of a prior business relationship with ZIR because he called ZIR to place an order for a book published by ZIR and he only alleges one subsequent call made by a live sales representative. [Dkt. 24 ¶¶ 15, 16.] Furthermore, the allegation regarding the job posting for the position of “telemarketing manger” at ZIR does not support the inference that ATDS was used when Kerr does not allege that ZIR made any call to him, but instead that the outbound call was made by “NMR, Paradigm, Paradigm Marketing, and/or Response North.” [See id. at ¶¶ 17, 30.] See Duguid v. Facebook, Inc., Case No. 15-cv-00985-JST, 2016 WL 1169365, at *5 (N.D. Cal. Mar. 24, 2016) (dismissing TCPA claim because plaintiff’s allegations did not support an inference that text messages were received by ATDS). Accordingly, Count I should be dismissed because Plaintiffs have not sufficiently alleged that ATDS was used to make the calls to their cellular telephones.1 2. Count I Fails with Respect to Plaintiffs Li, Barnard, and Curtis Because They Also Fail to Allege Facts Sufficient to Put ZIR on Notice of Any TCPA Claim. “Despite the flexible pleading policy of the Federal Rules of Civil Procedure, a complaint must give fair notice and state the elements of the claim plainly and succinctly.” Flores v. EMC Mortg. Co., 997 F. Supp. 2d 1088, 1102 (E.D. Cal. 2014) (noting that “a pleading may not simply allege a wrong has been committed and demand relief.”). “The plaintiff must allege with at least some degree of particularity overt acts which defendants engaged in that support the plaintiff’s 1 ZIR has also concurrently filed its Motion to Stay Proceedings pending a case currently before the United States Court of Appeals for the D.C. Circuit, ACA Int’l v. FCC, Case No. 15-1211. In that case, a number of petitioners challenge the Federal Communications Commission's overbroad definition of an ATDS. As further outlined in the Motion to Stay Proceedings, the outcome of ACA Int’l may have a potentially dispositive impact on this case given that Response North and ZIR do not use equipment with the present capacity to dial random or sequential telephone numbers. See 47 U.S.C. § 227(a)(1). Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 13 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -9- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS claim.” Davis v. Powell, 901 F. Supp. 2d 1196, 1210 (S.D. Cal. 2012) (citation omitted). While Kerr alleges some facts regarding the timing, context, and content of the one call purportedly made to his cellular telephone [Dkt. 24 ¶¶ 14- 16], no such facts are alleged for Li, Barnard, and Curtis. Instead, Li, Barnard, and Curtis only vaguely and conclusorily allege that on information and belief and within the limitations period (a four year time frame), they received one or more telephone calls on their cell phones from ZIR made via an ATDS. [Id. at ¶¶ 24-26, 29, 33.] They allege no facts regarding their full names (including middle initials), the number of calls they received, their current address and/or where they lived at the time of the alleged calls, the date or even approximate date on which they received such calls, the cell phone number on which they received the calls, the substance of the calls, the context for the calls, or any supporting facts that would put ZIR on notice about the claims against it. Requiring Plaintiffs to plead such facts, which are readily and uniquely available to them, is not unduly burdensome. Moreover, this does not impose a heightened pleading standard on Plaintiffs given that “‘context is indisputably relevant to determining whether a particular call is actionable under the TCPA.’“ Flores, 2015 WL 4340020, at *5 n.2 (citing Ryabyshchuck v. Citibank (South Dakota) N.A., No. 11-CV-1236-IEG WVG, 2012 WL 5379143, at *3 (S.D. Cal. Oct. 30, 2012)).2 2 Li, Barnard, and Curtis have already served discovery requests on ZIR and in doing so identified telephone numbers within those discovery requests that are apparently the numbers at which they were or may have been called by ZIR, although some of the numbers identified are landlines, not cellular numbers. [Dkt. 21-1, ¶¶3, 6 and Ex. B.] As set forth in the Declaration of Kevin J. Matras in Support of Defendant Zacks Investment Research. Inc.’s Motion to Stay Proceedings, ZIR has located no records reflecting an Edward Li, Tim Barnard, or Kenneth Curtis associated with the telephone numbers identified in the document requests served by Plaintiffs, [Dkt. 30-3, Matras Decl., ¶¶ 8-10], and thus no record or reason to believe that ZIR called these persons, let alone that any call was made to a cellular phone within the limitations period via ATDS and without the consent of Li, Barnard, and Curtis. While Li, Barnard, and Curtis’ allegations in the FAC are generally insufficient, see supra, they are certainly insufficient in this case where no Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 14 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -10- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS Furthermore, requiring such allegations puts Defendants and the Court on fair notice of Plaintiffs’ claims and prevents the potential abuse of the discovery process. See Rutman Wine Co. v. E. & J. Gallo Winery, 829 F. 2d 729, 738 (9th Cir. 1987) (“if the allegations of the complaint fail to establish the requisite elements of the cause of action, our requiring costly and time consuming discovery and trial work would represent an abdication of our judicial responsibility); Johansen, 2012 WL 6590551, at *3 (requiring a plaintiff to plead facts about the context and content of the calls gives fair notice by distinguishing the particular case that is before the court from every other hypothetically possible cause under the TCPA and “avoids the potential abuse of the discovery process to pressure defendants into settling weak cases”). For example, Li, Barnard, and Curtis seek recovery for each violation of the TCPA [Dkt. 24 ¶ 53], but provide no information regarding the number of calls they purportedly received from ZIR. This is insufficient to put ZIR on notice of the claims against it. See Abbas v. Selling Source, LLC, No. 09 CV 3413, 2009 WL 4884471, at *2 (N.D. Ill. Dec. 14, 2009) (plaintiff seeking recovery for each violation of TCPA did not put defendant on fair notice by failing to allege the number of SMS messages he received). Because Li, Barnard, and Curtis have only offered “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements,” Count I should be dismissed. See Ashcroft, 556 U.S. at 678. B. PLAINTIFF KERR FAILS TO STATE A CLAIM FOR VIOLATIONS OF THE CALIFORNIA INVASION OF PRIVACY ACT AGAINST ZIR (COUNT II). Section 632.7 of the California Penal Code makes it a crime to intentionally record (or assist in the recording of) any conversation where one or more of the connection between ZIR and these persons has been identified, and the bare bones allegations (name and county of residence) are otherwise insufficient to enable ZIR to identify and confirm any association with these persons. Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 15 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -11- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS parties is using a cordless or cellular telephone without the consent of every party to the conversation. CAL. PENAL CODE § 632.7(a) (West 2016). However, civil liability under the California Invasion of Privacy Act can only be imposed on the “person who committed the violation[.]” CAL. PENAL CODE § 637.2(a) (West 2016); see also Warden v. Kahn, 99 Cal. App. 3d 805, 815 (Cal. Ct. App. 1979) (privacy act provides civil damages only against the person who committed the violation); Kimmel v. Golan, 793 P.2d 524, 530 n.9 (Cal. 1990) (same). Here, civil liability cannot be imposed on ZIR because Kerr has not alleged any recording by ZIR of any call involving Kerr. Instead, Kerr alleges both the inbound and outbound calls identified in the FAC were received, made and recorded by entities other than ZIR, and Kerr otherwise makes no allegation that ZIR somehow assisted in the alleged recording of these calls. [Dkt. 24 ¶ 35, 55.] Kerr’s allegations regarding the “Strategic Partnership” between ZIR and NMR do not save his claims. [Dkt. 24 ¶¶ 20, 57.] California Penal Code Section 31 has been applied to the CA Privacy Act and defines “principals” as: All persons concerned in the commission of a crime, whether it be a felony or misdemeanor, and whether they directly commit the act constituting the offense, or aid and abet in its commission, or not being present have advised and encouraged its commission, … are principals in any crime so committed. CAL. PENAL CODE § 31 (emphasis added); see also Vera v. O’Keefe, 791 F. Supp. 2d 959, 963-65 (S.D. Cal. 2011) (applying Section 31 definition of principal to CA Privacy Act claim and finding that plaintiff could bring CA Privacy Act claim against one of two investigative journalists who carried out secret video and audio taping of conversation because non-recording journalist was a principal who was present during in the recording and aided and abetted in the commission of the crime). Kerr has not alleged that ZIR somehow assisted in a criminal act or in any way advised or encouraged any of the other defendants to intentionally record calls with Kerr without his knowledge. Indeed, there is no allegation that ZIR had any part in the telephone calling or recording procedures of NMR or any other company. Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 16 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -12- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS Certainly, the Letter of Intent attached to the FAC in no way suggests that ZIR contracted to assist with NMR’s calling and recording procedures (or those of any other company), nor that ZIR in any way controlled the calling or recording procedures of any company. [Dkt. 24-3.] There are simply no allegations that ZIR had anything to do with the mechanics of the inbound and outbound calls to Kerr (and more importantly, the alleged recording of said calls) and, therefore, Kerr lacks any basis to claim that ZIR engaged in the intentional recording of any call to or from Kerr, that ZIR assisted in the intentional recording of any such call, that ZIR aided and abetted in the intentional recording of any such call, or that ZIR advised and encouraged the intentional recording of any such call. [Dkt. 24 ¶¶ 20, 57.] Further, Kerr’s allegations that any call was recorded, and/or that if recorded, it was done without Kerr’s knowledge and consent, are highly speculative, conclusory and otherwise fail to plead the requisite intent by ZIR or any of the other defendants. Kerr alleges “on information and belief that NMR, Paradigm, Paradigm Marketing and/or Response North recorded [both] communications without notifying Kerr that the communications were being recorded and without obtaining Kerr’s consent.” [Dkt. 24 ¶38.] These allegations appear to be nothing more than Kerr throwing spaghetti against the wall and seeing what sticks because there is no factual basis for these otherwise conclusory allegations.3 Instead, Plaintiffs’ 3 Kerr’s counsel was provided with a copy of the recording of the inbound telephone call between NMR and Kerr. [Dkt. 30-5, Thorne Decl., ¶ 6.] The recording clearly demonstrates that the call does not involve a live representative, and unequivocally states at the start of the call that “To ensure proper handling and quality assurance this call will be recorded.” [Id., ¶ 7.] After being informed the call would be recorded, Kerr chose to continue with the call and order a product. [Id., ¶ 8; Dkt. 24 ¶15.] These facts, which were known to Kerr at the time of his filing of the original complaint and the FAC, establish his consent to the inbound call being recorded and directly contradict any basis for claiming a violation of the CA Privacy Act. E.g., Kearney v. Salomon Smith Barney, Inc., 137 P.3d 914, 930 (Cal. 2006) (“If, after being [] advised [of recording], another party does not wish to participate in the conversation, he or she may simply decline to continue the communication. A business that adequately advises all parties to a telephone call, at the outset of the conversation, of its intent to record the call would not violate the provision.”); Maghen v. Quicken Loans Inc., 94 F. Supp. 3d 1141, 1146 (C.D. Cal. 2015) (“A Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 17 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -13- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS “information and belief” appears to be based on Plaintiff’s counsel’s experience in other litigation against necessarily different parties under the CA Privacy Act. [Dkt. 24 ¶ 55.] Plaintiffs, however, are only permitted to plead factual allegations based upon information and belief if they have information leading them to believe that the allegations are true. Kane v. Delong, No. CV 13-05021-KAW, 2014 WL 894587, at *4 (N.D. Cal. Mar. 4, 2014). Here, Plaintiffs’ counsel’s unidentified experience in other litigation regarding the telephone recording practices of different companies does nothing to provide a basis as to the telephone recording practices of the defendants in this case. Moreover, Kerr himself has specific information that he knew the inbound call he made to NMR was going to be recorded because the call did not involve a live person and he was told the call would be recorded. Infra n. 3. Finally, Kerr makes no allegation of the requisite intent required of ZIR and the other defendants. Thus, even if this Court were to accept Kerr’s allegation that recording practices of other companies (apparently known to Plaintiffs’ counsel, but not identified in the FAC) provides a sufficient foundation for Kerr’s allegations here, his claim still fails because a plaintiff’s unsupported allegations that a defendant “had a policy or practice of recording telephone conversations” is insufficient to plead an intentional recording under the CA Privacy Act. See Vartanian v. VW Credit, Inc., No. 2:11-cv-10776-SVW-RZ, 2012 WL 12326334, at *2 (C.D. Cal. Feb. 22, 2012). Kerr’s generic allegations are insufficient to plead an business satisfies Section 632.7 [] by warning a party at the outset of a ‘conversation.’”). Regarding the outbound call, Response North has provided a declaration in connection with the motion to stay proceedings stating that it does not have telephone recordings between it and Kerr. [Dkt. 30-4, Smith Decl., ¶ 3.] While Kerr’s allegations regarding the inbound and outbound calls are conclusory and subject to dismissal based on pleading deficiencies, any attempt to replead these claims require good faith in making certain allegations that simply could not exist here. Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 18 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -14- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS intentional recording under the CA Privacy Act and, therefore, Count II must be dismissed with prejudice. C. PLAINTIFFS LI, BARNARD, AND CURTIS FAIL TO STATE A CLAIM FOR VIOLATIONS OF THE CALIFORNIA INVASION OF PRIVACY ACT AGAINST ZIR (COUNT III). Count III should be dismissed because Li, Barnard, and Curtis have not alleged any plausible factual basis for their claim that their calls were recorded by ZIR. Like Kerr, these Plaintiffs allege on “information and belief” that their calls were recorded, and like Kerr, these Plaintiffs fail to identify any information that would lead them to believe their conclusory allegations of recording are somehow true. Kane, 2014 WL 894587, at *4. First, Plaintiffs allege that it can be inferred that any outbound calls to them, which they allege were sales calls by a live person, were recorded because inbound calls to ZIR’s customer support number are answered by an automated system that provides a pre-recorded notification that “Your call may be recorded for quality assurance.” [Dkt. 24 ¶ 61.] However, the existence of such a disclaimer with respect to inbound customer service calls does not mean that any outbound sales calls would be recorded. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (“Factual allegations must be enough to raise a right to relief above the speculative level….”). Moreover, the fact that ZIR provided a recording notification for inbound calls suggests that it would do the same for outbound sales calls if, in fact, it might record those calls.4 Second, Li, Barnard, and Curtis also rely on the unidentified experience of 4 In the Declaration of Kevin J. Matras in Support of Defendant Zacks Investment Research. Inc.’s Motion to Stay Proceedings, Mr. Matras states that ZIR has not recorded outbound telephone calls since at least the beginning of 2012. [Dkt. 30-3, Matras Decl., ¶ 4.] Thus, while Count III fails for pleading deficiencies, any good faith basis to plead on information and belief or otherwise that ZIR recorded any alleged telephone call with Li, Barnard and Curtis does not exist, and allegations that any calls were recorded are pure speculation. See Twombly, 550 U.S. at 555. Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 19 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -15- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS Plaintiffs’ counsel in litigations addressing the practices of other companies as a basis to make allegations about ZIR’s practices. As discussed above, these highly generalized and wholly speculative allegations are insufficient to “nudge” their CA Privacy Act claims “across the line from conceivable to plausible” and accordingly, should be dismissed. See supra Section II. See also In re Facebook Internet Tracking Litig., 140 F. Supp. 3d 922, 937 (N.D. Cal. 2015) (dismissing CIPA claim because it comprised of a list of named plaintiffs coupled with the same generalized facts for each one); Vartanian v. VW Credit, Inc., 2012 WL 12326334, at *2 (generic allegations of defendants’ policies and procedures of recording phone calls insufficient to allege intentional recording in violation of CA Privacy Act); Sunbelt Rentals, Inc. v. Victor, 43 F. Supp. 3d 1026, 1036 (N.D. Cal. 2014) (CA Privacy Act claim based on conclusory allegations that defendant accessed, intercepted, monitored, stored, and used plaintiff’s private electronic data and electronic communications was insufficient to state claim). Third, Count III is insufficiently pled given that Li, Barnard, and Curtis have only provided bare-bones allegations that an unspecified number of calls were made within the limitations period for a TCPA claim, which is four years. See 28 U.S.C. §1658(a); Giovanniello v. ALM Media, LLC, 726 F.3d 106, 115 (2d Cir. 2013). However, the statute of limitations under the CA Privacy Act is one year. CAL. C.C.P. § 340; Montali v. Catanzariti, 191 Cal. App. 3d 96, 98 (1987). Thus, it is speculative not only whether one or more calls was even made within the one year statute of limitations period for a claim under the CA Privacy Act, but also whether any call was recorded in the applicable time period given that the FAC merely alleges phone calls were made to Li, Barnard, and Curtis sometime within the last four years. [Dkt. 24 ¶¶ 24-26.] See Kemety v. Bank of America, Inc., No. 10cv1910- LAB (RBB), 2011 WL 4566441, at *1 (S.D. Cal. Sept. 30, 2011) (when considering whether running of statute of limitations is apparent on face of complaint, court should consider whether complaint adequately pleads facts to show that tolling is Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 20 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -16- Case No. 16-cv-1352 GPC BLM SMRH:479529194.2 MEMORANDUM OF POINTS AND AUTHORITIES ISO DEFENDANT ZACKS INVESTMENT RESEARCH, INC.’S MOTION TO DISMISS available and could render the claim timely). Count III is also insufficiently pled because they allege no facts about the time, date, or number of calls purportedly recorded but they seek statutory damages of $5,000 per recorded communication. [Dkt. 24 ¶ 63.] Such conclusory allegations are simply insufficient to put ZIR on notice of the claims against it. See Abbas, 2009 WL 4884471, at *2. V. CONCLUSION For the forgoing reasons, Defendant Zacks Investment Research, Inc. respectfully requests that the Court dismiss all of the claims asserted against it in Plaintiffs’ First Amended Complaint with prejudice. Dated: October 20, 2016 BURKE, WARREN, MACKAY & SERRITELLA, P.C. By s/Danielle J. Gould DANIELLE J. GOULD Attorneys for Defendant ZACKS INVESTMENT RESEARCH, INC. Email: dgould@burkelaw.com Case 3:16-cv-01352-GPC-BLM Document 31-1 Filed 10/20/16 Page 21 of 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 16-cv-1352 GPC BLM SMRH:477933209.2 PROOF OF SERVICE SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A Limited Liability Partnership Including Professional Corporations SHANNON Z. PETERSEN, Cal. Bar No. 211426 petersen@sheppardmullin.com LISA S. YUN, Cal. Bar No. 280812 lyun@sheppardmullin.com 12275 El Camino Real, Suite 200 San Diego, California 92130-2006 Telephone: 858.720.8900 Facsimile: 858.509.3691 BURKE, WARREN, MACKAY & SERRITELLA, P.C. DANIELLE J. GOULD, pro hac vice application to be filed dgou`ld@burkelaw.com SARA YOUN CHOH, pro hac vice application to be filed schoh@burkelaw.com 330 North Wabash Avenue, 22nd Floor Chicago, Illinois 60611 Telephone: 312.840.7000 Facsimile: 312.840.7900 Attorneys for Defendant ZACKS INVESTMENT RESEARCH, INC. UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA JOHN KERR, individually and on behalf of all others similarly situated, Plaintiff, v. ZACKS INVESTMENT RESEARCH, INC., an Illinois corporation; and DOES 1 through 50, inclusive, Defendants. Case No. 16-cv-1352 GPC BLM PROOF OF SERVICE Date: December 9, 2016 Time: 1:30 p.m. Courtroom 2D (2nd Floor - Schwartz) Suite 2190 Hon. Gonzalo P. Curiel Case 3:16-cv-01352-GPC-BLM Document 31-2 Filed 10/20/16 Page 1 of 2 Case 3:16-cv-01352-GPC-BLM Document 31-2 Filed 10/20/16 Page 2 of 2