2011.03.31 at&t's motion to dismiss

8/7/2019 2011.03.31 AT&T's Motion to Dismiss

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NOTICE OF MOTION & MOTION TO DISMISSCOMPLAINT AS TO PLAINTIFF TRAN; MEMO. OF

POINTS & AUTH. CASE NO. CV 11-00541 CRB

Steven P. Rice (State Bar No. 094321)[email protected]

Theresa C. Lopez (State Bar No. 205338)[email protected]

CROWELL & MORING LLP3 Park Plaza, 20th FloorIrvine, CA 92614-8505Telephone: (949) 263-8400Facsimile: (949) 263-8414

John Nadolenco (State Bar No. 181128)[email protected]

MAYER BROWN LLP350 South Grand Avenue, 25th FloorLos Angeles, California 90071-1503Telephone: (213) 229-9500Facsimile: (213) 625-0248

Attorneys for Defendants

AT&T Mobility and AT&T Inc.

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

FREDRICK M. BLAU, et al., individuallyand on behalf of all others similarlysituated,

Plaintiffs,

v.

AT&T MOBILITY, a Delawarecorporation; AT&T INC., a Delawarecorporation,

Defendants.

Case No. CV 11-00541 CRB

NOTICE OF MOTION AND MOTION TODISMISS COMPLAINT AS TOPLAINTIFF ANTHONY P. TRAN;MEMORANDUM OF POINTS AND

AUTHORITIES IN SUPPORT THEREOF

Date: May 6, 2011Time: 10:00 a.m.Courtroom: 8

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iNOTICE OF MOTION & MOTION TO DISMISS

COMPLAINT AS TO PLAINTIFF TRAN; MEMO. OF


TABLE OF CONTENTS

Page

NOTICE OF MOTION AND MOTION TO DISMISS .................................................................. 1

STATEMENT OF GROUNDS AND ISSUES TO BE DECIDED ................................................ 1

MEMORANDUM OF POINTS AND AUTHORITIES ................................................................. 2

I. SUMMARY OF TRANS CLAIMS ................................................................................... 2II. LEGAL STANDARD .......................................................................................................... 3III. ARGUMENT ....................................................................................................................... 4

A. The Federal Communications Act Preempts Trans Claims Because TheyAre Challenges To ATTMs Service Quality And Rates......................................... 4

B.

Trans Fraud-Based Claims Fail Under Rule 9(b) And Applicable StateLaw. .......................................................................................................................... 8

1. Rule 9(b) Applies To All Of Trans Fraud-Based Claims. ........................ 82. Trans Fraud-Based Claims Fail Because They Do Not Plead The

Who, What, When, Where, And How Of The Alleged FraudulentConduct.................................................................................................... 10

3. To The Extent Trans Misrepresentation Claim Is Based OnGeneral Advertising Statements of Opinion, The Court ShouldDismiss That Claim Because Those Statements Are Non-Actionable As A Matter Of Law............................................................... 11

C. Trans Claims For Intentional And Negligent Misrepresentation AreDefective Because Tran Does Not Allege The Required Reliance........................ 14

1. ATTM Disclosed Limitations On Network Performance......................... 142. Trans Conclusory Allegations of Reliance Are Inadequate. .................. 15

D. The Court Should Also Dismiss Trans Claim for Fraud By ConcealmentBecause He Has Not Sufficiently Alleged That Defendants Breached ALegal Duty To Disclose The Facts Allegedly Concealed ...................................... 16

E. The Court Should Dismiss Trans Statutory Consumer Protection ClaimsFor Failure To Plead Required Elements Of Those Statutes. ................................ 17

1. Trans FAL and CLRA Claims Fail To Allege A CausalConnection Between Defendants Alleged Conduct And TheAlleged Harm........................................................................................... 17

2. Trans CLRA Claim Should Be Dismissed Because Tran HasFailed To File The Affidavit Required Under Section 1780(d) OfThe CLRA ................................................................................................ 18


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iiNOTICE OF MOTION & MOTION TO DISMISS

COMPLAINT AS TO PLAINTIFF TRAN; MEMO. OFPOINTS & AUTH.; CASE NO. CV 11-00541 CRB

3. Trans CLRA Claim Should Be Dismissed With PrejudiceBecause, Despite Seeking Monetary Damages In His Complaint,He Failed To Provide The Pre-Lawsuit Notice Required UnderSection 1782 Of The CLRA...................................................................... 19

F. The Court Should Dismiss Trans Negligent Misrepresentation ClaimBecause It Is Barred By The Economic Loss Doctrine .......................................... 20

G. The Court Should Dismiss Trans Breach of Contract/Warranty Claims.............. 20IV. CONCLUSION .................................................................................................................. 21


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iiiNOTICE OF MOTION & MOTION TO DISMISS



TABLE OF AUTHORITIES

Page

FEDERAL CASESAshcroft v. Iqbal,

55 U.S. 1937 (2009) ................................................................................................................ 3Aubrey v. Ameritech Mobile Commcns, Inc.,

No. 00-75080, 2002 WL 32521813 (E.D. Mich. June 17, 2002) ........................................... 5

Bastien v. AT&T Wireless Servs., Inc.,205 F.3d 983 (7th Cir. 2000) ................................................................................... 4, 5, 6, 7, 8

Bell Atlantic Corp. v. Twombly,127 S.Ct. 1955 (2007) ............................................................................................................. 3

Bly-Magee v. California,236 F.3d 1014 (9th Cir. 2001) ................................................................................................. 8

Branch v. Tunnell,

14 F.3d 449 (9th Cir. 1994) ................................................................................................... 15Cisneros v. Instant Capital Funding Grp., Inc.,

263 F.R.D. 595 (E.D. Cal. 2009) .......................................................................................... 10

Cooper v. Pickett,137 F.3d 616 (9th Cir. 1997) ................................................................................................... 8

Destifino v. Rieswig,630 F.3d 952 (9th Cir. 2011) ................................................................................................. 10

Fanucci v. Allstate Ins. Co.,638 F. Supp. 2d 1125 (N.D. Cal. 2009) ................................................................................ 15

Fedor v. Cingular Wireless Corp.,355 F.3d 1069 (7th Cir. 2004) ................................................................................................. 5

Glen Holly Entmt, Inc. v. Tektronix Inc.,343 F.3d 1000 (9th Cir. 2003) ............................................................................................... 12

Haskel v. Time, Inc.,857 F. Supp. 1392 (E.D. Cal 1994) ....................................................................................... 12

In re Apple iPhone 3G Prods. Liab. Litig.,728 F. Supp. 2d 1065 (N.D. Cal. 2010) .......................................................................... 6, 7, 8

In re Sony Grand Wega KDF-E A10/A20 Series Rear Projection HDTV TelevisionLitig., --- F.Supp.2d ----, Nos. 08-CV-2276-IEG (WVG), 09-CV-0620-IEG(WVG), 09-CV-0736-IEG (WVG), 09-CV-2703-IEG (WVG), 2010 WL4892114 (S.D. Cal. Nov. 30, 2010)..................................................................... 12, 13, 14, 19

Kearns v. Ford Motor Co.,567 F.3d 1120 (9th Cir. 2009) ................................................................................................ 9

Laster v. T-Mobile USA, Inc.,407 F. Supp. 2d 1181 (S.D. Cal. 2005) ................................................................................. 18

Lee v. City of Los Angeles,250 F.3d 668 (9th Cir. 2001) ........................................................................................... 15, 18

Moss v. U.S. Secret Service,572 F.3d 962 (9th Cir. 2009) ................................................................................................... 3


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ivNOTICE OF MOTION & MOTION TO DISMISS


Neubronner v. Milken,6 F.3d 666 (9th Cir. 1993) ....................................................................................................... 8

Oestericher v. Alienware Corp.,544 F. Supp. 2d 964 (N.D. Cal. 2008) ............................................................................ 12, 14

Ranger v. T-Mobile USA, Inc.,No. EDCV 08-1518-VAP (JCx), 2009 WL 416003 (C.D. Cal. Feb. 19, 2009) ..................... 8

Shroyer v. New Cingular Wireless Servs., Inc.,606 F.3d 658 (9th Cir. 2010) ................................................................................................... 6

Southland Sod Farms v. Stover Seed Co.,108 F.3d 1134 (9th Cir. 1997) ............................................................................................... 12

Stickrath v. Globalstar, Inc.,527 F. Supp. 2d 992 (N.D. Cal. 2007) .................................................................................. 18

Vess v. Ciba-Geigy Corp. USA,317 F.3d 1097 (9th Cir. 2003) ....................................................................................... 8, 9, 10

Von Grabe v. Sprint PCS312 F. Supp. 2d 1285 (S.D. Cal. 2003) ................................................................................ 20

Wolph v. Acer Am. Corp.,No. C 09-01314, 2009 WL 2969467 (N.D. Cal. Sept. 14, 2009) ........................................... 9

Yazdanpanah v. Sacramento Valley Mortgage Group,No. C 09-02024 SBA, 2009 WL 4573381 (N.D. Cal. Dec. 1, 2009) ................................... 15

CALIFORNIA CASESAlliance Mortgage Co. v. Rothwell,

10 Cal. 4th 1226 (1995) ........................................................................................................ 14

Cohen v. DIRECTV, Inc.,178 Cal. App. 4th 966 (Ct. App. 2009) ................................................................................. 18

Kwikset Corp. v. Super. Ct.,51 Cal. 4th 310 (2011) .......................................................................................................... 17

Lingsch v. Savage,213 Cal. App. 2d 729 (1963) ................................................................................................. 16

Mirkin v. Wasserman,5 Cal. 4th 1082 (1993) .................................................................................................... 15, 16

Molko v. Holy Spirit Assn.,46 Cal. 3d 1092 (1988) ......................................................................................................... 16

OCM Principal Opportunities Fund v. CIBC World Markets Corp.,157 Cal. App. 4th 835 (2007)................................................................................................ 16

Robinson Helicopter Co., Inc. v. Dana Corp.,34 Cal. 4th 979 (2004) .......................................................................................................... 20

Williams v. Beechnut Nutrition Corp.,185 Cal. App. 3d 135 (1986) ................................................................................................. 21


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vNOTICE OF MOTION & MOTION TO DISMISS


FEDERAL STATUTES

15 U.S.C. 2301 ........................................................................................................................... 7

47 U.S.C. 332(c)(3)(A) .......................................................................................... 2, 4, 5, 6, 7, 8

STATE STATUTESBus. & Prof. Code 17200 ........................................................................................................... 7

Bus. & Prof. Code 17500 ....................................................................................................... 2, 7

Bus. & Prof. Code 17535 ......................................................................................................... 17

Civ. Code 1750 ...................................................................................................................... 2, 7

Civ. Code 1780(a) .................................................................................................................... 17

Civ. Code 1780(d) .............................................................................................................. 18, 19

Civ. Code 1782(a)(1)-(2) ......................................................................................................... 19

FEDERAL RULES

Fed. R. Civ. P. 9(b) .............................................................................................................. 2, 8, 9

Fed. R. Civ. P. 12(b)(2) ................................................................................................................ 1

Fed. R. Civ. P. 12(b)(6) ............................................................................................................ 1, 3

OTHER AUTHORITY

In re Wireless Consumers Alliance, Inc.(In re Wireless),15 F.C.C.R. 17021, 2000 WL 1140570 (F.C.C. Aug. 14, 2000) ........................................... 5, 6


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1NOTICE OF MOTION & MOTION TO DISMISS



NOTICE OF MOTION AND MOTION TO DISMISS

PLEASE TAKE NOTICE that, on May 6, 2011, at 10:00 a.m., or as soon thereafter as

counsel may be heard, before the Honorable Charles R. Breyer, in Courtroom 8 of the United

States District Court for the Northern District of California (San Francisco), located at 450

Golden Gate Avenue, San Francisco, California 94102, Defendants AT&T Inc. 1 and AT&T

Mobility LLC (ATTM) (collectively, at times, Defendants) will move to dismiss, pursuant to

Federal Rule of Civil Procedure 12(b)(6), all claims asserted in the Complaint filed by Plaintiff

Anthony P. Tran (Tran) for failure to state a claim upon which relief can be granted.

This Motion is based on this Notice of Motion and Motion, the accompanying

Memorandum of Points and Authorities, the pleadings and papers on file in this action, and upon

such other and further evidence or oral argument as may be permitted by the Court at the hearing

of this matter.

STATEMENT OF GROUNDS AND ISSUES TO BE DECIDED

As a matter of law, Tran has not pled facts or alleged conduct sufficient to state a claim

for relief against AT&T Inc. or ATTM, and the Court should therefore dismiss with prejudice all

of Trans claims as to each Defendant under Federal Rule of Civil Procedure 12(b)(6).

All of Trans claims arise from complaints about ATTMs service quality based on the

allegation that Defendants have not adequately built up ATTMs cellular phone network in the

San Francisco/Bay Area to keep pace with the demand for its voice and data service among

certain of its subscribers. Tran further claims that this demand was magnified by Defendants

aggressive advertising campaign despite knowledge that its network could not accommodate

the existing demand.

The issues to be decided in this Motion to Dismiss are:

1 Defendant AT&T Inc. has separately filed a motion to dismiss for lack of personaljurisdiction under Federal Rule of Civil Procedure 12(b)(2) as to all Plaintiffs. [See Docket Entry13, 13-1 and 13-2.] That motion is scheduled to be heard concurrently with this motion. If thejurisdiction motion is granted, this motion will be rendered moot as to Defendant AT&T Inc., butit will still need to be decided as to Defendant AT&T Mobility.


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1. Whether all of Trans claims should be dismissed on the grounds that they are

preempted by Section 332 of the Federal Communications Act, 47 U.S.C. 332(c)(3)(A).

2. Whether Trans fraud-based claims should be dismissed for failure to plead with

the particularity required under Rule 9(b) and for failure to plead key required elements of those

claims.

3. Whether Trans claims are barred because the contractual Terms of Service

attached to the Complaint expressly disclose service limitations.

4. Whether Trans claims under Californias Consumer Legal Remedies Ac

(CLRA) (Civ. Code 1750) and Californias False Advertising Law (FAL) (Bus. & Prof

Code 17500) fail because he has not plead the required elements of those statutes or complied

with the notice requirements of the CLRA.

5. Whether Trans negligent misrepresentation claim is barred by the economic loss

doctrine.

6. Whether Trans warranty-based claims fail because Tran does not and canno

allege an actual breach of any warranty.

MEMORANDUM OF POINTS AND AUTHORITIES

I. SUMMARY OF TRANS CLAIMSTran, individually and on behalf of all others similarly situated,2 purport to assert class

claims against Defendants AT&T Inc. and ATTM (collectively, at times, Defendants) for

(1) breach of contract, (2) breach of implied warranty of merchantability, (3) violation of

California Business & Professions Code 17500, et seq., (4) violation of Californias Consumer

Legal Remedies Act (CLRA) (Cal. Civ. Code 1750, et seq.), and (5) fraud by intentional

misrepresentation, and (6) fraud by concealment. (See Compl., 2:2-8.) These claims arise from

the allegedly poor quality of service Tran received over the ATTM cellular network, which Tran

asserts was compounded by Defendants aggressive[] market[ing] of their service to users of

2 Defendants have filed a motion to compel arbitration as to Trans co -Plaintiffs FredrickM. Blau, Jacob Stern, and Lenza H. McElrath III. [See Docket Entry 17 through 17-10.]Defendants reserve the right to move to compel arbitration of Trans claims at a future date.


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smartphones and other data hungry devices . . . knowing their network infrastructure could not

possibly accommodate the demands the increased usage would cause. (Id., 2:19-22.)

Tran claims he experienc[ed] persistent service quality and reliability issues . .

includ[ing] slow or non-functional internet connectivity, innumerable dropped calls, and the

inability to place or receive calls. (Compl., 3:1-3.) Tran further claims he was also held

hostage by the costs associated with changing providers . . . [including] an Early Termination

Fee that Defendants insisted on assessing if [Tran] sought refuge in another wireless service

provider. (Id., 3:7-9.) Finally, Tran alleges that AT&T has been unwilling to address the

significant problems with their service and continue to promote [their] service as superior, even as

the problems get worse and customer satisfaction levels decline. (Id., 3:10-12.) Tran claims that

AT&T has . . . instituted policies that penalize customers for seeking service elsewhere, and do

not allow fee adjustments when AT&T is unable to provide service of reasonable quality. (Id.

3:12-14.)

II. LEGAL STANDARDAlthough a court must assume the facts of a complaint to be true when ruling on a motion

to dismiss under Rule 12(b)(6), a claim can survive past the motion to dismiss stage only if the

complaint alleges enough facts to state a claim to relief that is plausible on its face. Bel

Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1974 (2007); see also Ashcroft v. Iqbal, 55 U.S. 1937

1950 (2009). To the extent that a complaints allegations are conclusory, a court must disregard

them. Moss v. U.S. Secret Service, 572 F.3d 962, 968-72 (9th Cir. 2009) (granting motion to

dismiss and noting that for a complaint to survive a motion to dismiss, the non-conclusory

factual content, and reasonable inferences from that content, must be plausibly suggestive of a

claim entitling the plaintiff to relief) (internal citations omitted). Accordingly, this Court should

credit only the well-pled allegations, and should dismiss all claims for which those well-pled

allegations are insufficient to state a plausible claim for relief. Id. Because all ofTrans claims

against Defendants suffer from fundamental defects and thus fail to state plausible claims for

relief, the Court should dismiss all of them with prejudice.

/ / /


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III. ARGUMENTA. The Federal Communications Act Preempts Trans Claims Because They Are

Challenges To ATTMs Service Quality And Rates.

Section 332 of the Federal Communications Act, 47 U.S.C. 332(c)(3)(A), expressly

prohibits a state from regulating the right of a wireless carrier to enter the market and the rates for

cellular service. Under Section 332, only federal law may regulate these matters. Trans claims

fall squarely within the preemption clause of Section 332 because they directly challenge the

quality of wireless service on the ATTM network and the rates for that service.

Section 332 provides that no State or local government shall have any authority to

regulate the entry of or the rates charged by any commercial mobile service . . . except that this

paragraph shall not prohibit a State from regulating the other terms and conditions of commercial

mobile services. 47 U.S.C. 332(c)(3)(A). The first clause provides that state regulation of the

entry of or the rates charged by a wireless carrier is completely preempted. The second clause

makes clear that state regulation of other terms and conditions of commercial mobile services

are not limited by the express preemption of rate and entry regulation.

Numerous courts and the Federal Communications Commission (FCC) have held that

Section 332 preempts claims, like those at issue here, which require a court to determine the

reasonableness of rates charged for wireless services or whether the level of wireless services

justifies the rates charged. For example, in Bastien v. AT&T Wireless Servs., Inc., 205 F.3d 983

(7th Cir. 2000), the plaintiff asserted claims for breach of contract and consumer fraud under

Illinois state law, alleging that defendant AT&T Wireless Service (AWS) signed up

subscribers without first building the cellular towers and other infrastructure necessary to provide

reliable cellular connections, that many of his calls were dropped or could not be completed, that

AWS continued to market its services despite its network limitations, that AWS misrepresented

its services and concealed material facts about its service, and that AWS failed to provide

appropriate means for crediting dropped or incomplete calls. Id. at 985.

The district court in Bastien found that these allegations challenged AWSs service and

rates. The Seventh Circuit agreed, observing that while the plaintiffs claims appear more like


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traditional state law claims, they are all founded on the fact that [AWS] had not built more towers

and more fully developed its network at the time Bastien tried to use the system. Id. at 989. The

Seventh Circuit held that the plaintiffs state law claims were preempted by Section 332, because

they constituted a challenge to defendants rates and right to enter the market on the terms

specified by the FCC. . . . Id. at 984. See also Fedor v. Cingular Wireless Corp., 355 F.3d

1069, 1074 (7th Cir. 2004); Aubrey v. Ameritech Mobile Commcns, Inc., No. 00-75080, 2002

WL 32521813, at *3-4 (E.D. Mich. June 17, 2002) (holding state law claims related to

degradation of service preempted by federal law because quality of service and rates challenged)

In re Wireless Consumers Alliance, Inc. (In re Wireless), 15 F.C.C.R. 17021, 2000 WL

1140570, at *8 (F.C.C. Aug. 14, 2000).

As in Bastien, Tran here directly challenges the quality and level of performance of the

ATTM wireless network. He asserts that Defendants misled customers by advertising tha

Defendants have the fewest dropped calls, more bars in more places, and the fastest mobile

broadband network. (Compl. at 2:13-14.) He also claims that Defendants aggressively

marketed their service to users of smartphones and other data hungry devices, and offered users

of these devices unlimited internet connectivity . . . knowing their network infrastructure could

not possibly accommodate the demands the increased usage would cause. (Id., 2:19-22.) Tran

contends that the issues with AT&T Wireless Service are particularly acute in the Bay Area.

(Id., 9:5-6.) He claims that despite this, AT&T Wireless Services ads are often specifically

targeted at the Bay Area. (Id., 10:21.) According to Tran, he experienc[ed] persistent service

quality and reliability issues . . . include[ing] slow and non-functional internet connectivity,

innumerable dropped calls, and the inability to place or receive calls. (Id., 3:1-3.) Based on

these claims, Tran takes direct aim at ATTMs alleged failure to develop and improve its wireless

network. He claims that AT&T has not been sufficiently diligent about upgrading their network

infrastructure. (Id.,11:21-22.)

Tran cannot evade the preemption of Section 332 by dressing up his challenge to ATTMs

service as common law contract and tort and statutory consumer protection claims. This is

exactly what Tran has done here, since his claims are all predicated on poor service quality due to


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Defendants alleged failure to upgrad[e] their network infrastructure. (Compl., 11:21-22.)

Courts look to the substance of the claims, and not the labels attached to them, to determine their

true nature. See Bastien, 205 F.3d at 987 ([w]e will not be bound by the names and labels placed

on a complaint by the plaintiff when that complaint in fact raises a federal question.). State law

claims may in substance and effect amount to regulation of CMRS [wireless providers] rates

even though not formally styled as such. In re Wireless, 15 F.C.C.R. at 17037 n.91, 2000 WL

1140570.

In Shroyer v. New Cingular Wireless Servs., Inc., 606 F.3d 658 (9th Cir. 2010), the Ninth

Circuit was faced with similar, though distinguishable, allegations as made here. There, the

plaintiff also alleged breach of contract and misrepresentations claims. However, unlike here

plaintiff did not specifically challenge the adequacy of the wireless carriers infrastructure or

wireless network or allege that the wireless carrier had been remiss in building or maintaining that

infrastructure or wireless network. For that reason, in Shroyer, the Ninth Circuit held that the

plaintiffs state law claims were not preempted by Section 332. See id. at 661-662. Here

however, Tran has made those specific attacks. (See, e.g., Compl., 56 (AT&T has not taken

adequate steps to relieve congestion on their wireless network.); id., 27 (The wireless

technologies used by AT&T to provide wireless services can only provide a limited amount of

bandwidth that is shared by all users of the wireless network in a particular area. If there is too

much demand in a given area, service quality and reliability can be severely degraded.); and id.

54 (AT&T has not been sufficiently diligent about upgrading their network infrastructure.)

Given these specific attacks on ATTMs infrastructure and network, Trans claims are

distinguishable from the claims made in Shroyerand, instead, are like those dismissed in Bastien.

In In re Apple iPhone 3G Prods. Liab. Litig. (In re Apple), 728 F. Supp. 2d 1065 (N.D

Cal. 2010), which addressed the launch of the Apple iPhone 3G, the plaintiffs alleged, similarly to

Tran here, that ATTM advertised the iPhone 3G as Twice as Fast in comparison to the 2G

EDGE network on which the earlier phone operated. Id. at 1068. However, plaintiffs claimed

this marketing was false because, in reality, [c]onsumers who purchased the iPhone 3G mainly

still connect to the 2G EDGE network, not a 3G network . . . often receive no 3G connectivity at


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all, or experience a significant level of dropped calls because the iPhone 3G cannot locate an

available 3G network connection. Id. The plaintiffs further alleged:

Apple and ATTM misled Plaintiffs and other consumers by

misrepresenting material facts and not disclosing that the iPhone

3G and ATTM 3G network were faulty and failed to provide

consistent connectivity on a 3G network. [Citation omitted.] Both

Apple and ATTM profited by selling iPhone 3G devices without

the appropriate infrastructure in place and the presence of defective

hardware and software in the iPhone 3G.

Id. Based on these factual allegations, the plaintiffs alleged claims for violation of the California

Unfair Competition Law (UCL) (Bus. & Prof. Code 17200 ), California False Advertising

Law (FAL) (Bus. & Prof. Code 17500), the California Consumer Legal Remedies Ac

(CLRA) (Civ. Code 1750), the federal Magnuson-Moss Warranty Act (15 U.S.C. 2301)

violation of the New York, New Jersey, North Carolina and Florida consumer protection statutes

as well as claims for breach of express and implied warranty of merchantability, negligence

common counts and unjust enrichment, negligent misrepresentation, fraud and deceit, and

declaratory relief.3

In addressing the issue of preemption under Section 332, the court in In Re Apple found

that [p]laintiffs claims are based on the core allegation that Defendants knew that ATTMs 3G

network was not sufficiently developed to accommodate the number of iPhone 3G users, and that

Defendants deceived Plaintiffs into paying higher rates for a service that Defendants knew they

could not deliver. Id. at 1072. As in Bastien, the In re Apple court further found tha

[p]laintiffs allegations target the sufficiency of ATTMs network infrastructure and the ab ility

of Apples iPhone 3G to operate within the network to deliver the promised twice as fast

3 Tran, here, alleges an almost identical subset of the preempted state law claims assertedin In re Apple: breach of contract (express warranty), breach of contract (implied warranty ofmerchantability), violation of the FAL, unfair and deceptive practices under the CLRA, fraud byintentional or negligent misrepresentation, and fraud by concealment. (Compl., pp. 14-19.)


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performance. Id. As the court in Bastienrecognized, [w]hile these charges appear more like

traditional state law claims, they are all founded on the fact that [the wireless carrier defendant]

had not built more towers and more fully developed its network at the time [the plaintiff] tried to

use the system. Id. (brackets in original). Based on these findings, the court in In re Apple held

that allof the plaintiffs state law claims were preempted.

As in Bastien and In re Apple, Trans claims turn on the quality and level of the wireless

network service provided by ATTM. Consequently, a judicial decision in this case is exactly the

type of state regulation of service that Section 332 expressly prohibits. Trans claims are

therefore, preempted.

B. Trans Fraud-Based Claims Fail Under Rule 9(b) And Applicable State Law.1. Rule 9(b) Applies To All OfTrans Fraud-Based Claims.

Rule 9(b) requires that in alleging fraud or mistake, a party must state with particularity

the circumstances constituting fraud or mistake. The particularity requirement demands that

[a]verments of fraud must be accompanied by the who, what, when, where, and how of the

misconduct charged. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003)

(quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)). The underlying purpose of Rule

9(b) is to be specific enough to give defendants notice of the particular misconduct . . . so that

they can defend against the charge and not just deny that they have done anything wrong. Bly-

Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001) (quoting Neubronner v. Milken, 6 F.3d

666, 672 (9th Cir. 1993)).

Rule 9(b)s particularity requirement applies not only to Trans common law claims for

fraud by intentional and negligent misrepresentation (Count 5) and fraud by concealment (Count

6), but to all of his claims because they all sound in fraud. See Ranger v. T-Mobile USA, Inc., No

EDCV 08-1518-VAP (JCx), 2009 WL 416003 (C.D. Cal. Feb. 19, 2009) (Rule 9(b) also applies

when the claim sounds in fraud, by alleging the defendant engaged in fraudulent conduct, but

the claim itself does not contain fraud as an essential element. [Citation omitted.] Indeed, even if

a complaint does not assert explicitly a claim for fraud and even if none of the claims in a

complaint sound in fraud, any allegations of fraudulent conduct in a complaint must be pled


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with particularity.). Under Ninth Circuit law, if a plaintiff alleges a unified course of fraudulent

conduct, the claim is said to be grounded in fraud or to sound in fraud, and the pleading . . .

as a whole must satisfy the particularity requirement of Rule 9(b)). Kearns v. Ford Motor Co.

567 F.3d 1120, 1125 (9th Cir. 2009) (citations omitted; emphasis added) (Rule 9(b) applies to

claims for violations of CLRA and UCL); Wolph v. Acer Am. Corp., No. C 09-01314, 2009 WL

2969467, at *5 (N.D. Cal. Sept. 14, 2009) (Rule (9(b) applies to claims for negligent

misrepresentation and claims under the FAL) (citing Vess, 317 F.3d at 1104).

The Complaint broadly alleges a fraudulent course of conduct.4 Tran alleges that

Defendants aggressively marketed their service to users of smartphones and other data hungry

devices, and offered users of these devices unlimited internet connectivity . . . knowing their

network infrastructure could not possibly accommodate the demands the increased usage would

cause. (Compl., 2:19-22; see also id., 29, 33-34.) Tran further alleges that AT&T has been

unwilling to address the significant problems with their service and continue to promote their

service as superior, even as the problems get worse and customer satisfaction levels decline.

(Id., 3:10-12.) Tran also alleges that despite these alleged service quality issues, Defendants

instituted policies that penalize customers for seeking service elsewhere, and . . . not allow[ing]

fee adjustments when AT&T is unable to provide service of reasonable quality. (Id., 3:12-14.)

Tran alleges that [b]y the end of 2007 AT&T knew that it was experiencing service quality and

reliability issues due to the increased demands on their network. (Id., 30.) Tran further claims

that [d]espite having full knowledge of the deficiencies in their network infrastructure, AT&T

continues to aggressively marketed [sic] their service to new subscribers, further exacerbating the

existing service problems. (Id., 34.) Moreover, plaintiff claims that AT&T is aware that they

suffer significant infrastructure issues in the Bay Area. (Id., 38.) Despite this alleged

knowledge, Defendants [continue to] represent in printed promotional material, in person, and

4 Each count of the Complaint incorporates all of the factual allegations preceding it. (SeeCompl., 68, 74, 78, 83, 92 and 100.) Thus, all of the factual allegations of the introductoryparagraphs and paragraphs 1 through 67 serve as a basis for the six claims asserted in theComplaint.


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elsewhere, that their wireless service area includes the vast majority of the United States . .

includ[ing] all of the Bay Area. (Id., 42-43.) Street level coverage maps, generated by

AT&T, describe coverage as Good or Best in the areas where Plaintiffs used AT&T Wireless

Service. (Id., 44.) In fact, AT&T has run a local and national advertising campaigns [sic] . .

stating that AT&T has the fewest dropped calls, more bars in more places, and that their

network is the nations fastest. (Id., 47.) Plaintiff further claims that these advertisements

were often specifically targeted at the areas where Plaintiffs used AT&T Wireless Service [in the

Bay Area]. (Id., 48.) Tran claims that he spoke with AT&T regarding the service issues and

that AT&T claimed that the service issues were not the result of a systemic network infrastructure

problem, but, rather, were due to temporary network issues, faulty phone equipment, or the need

for additional hardware (i.e., purchase of a MicroCell), but that AT&Ts overall service

coverage and quality in the areas [Tran] used was high. (Id., 52.) Finally, Tran claims that

based on all of these facts Defendants knew or should have known that long term infrastructure

problems were to blame for the problems [Tran] experienced with AT&T Wireless Services.

(Id., 53.) Given the broad fraudulent course of conduct demonstrated by these allegations, Rule

9(b) applies to all of Trans claims, not just his claims for fraud by intentional and negligent

misrepresentation and fraud by concealment.

2. Trans Fraud-Based Claims Fail Because They Do Not Plead The Who,What, When, Where, And How Of The Alleged Fraudulent Conduct.

As noted above, Rule 9(b) requires Tran to specify the who, what, when where, and

how of the alleged fraudulent conduct. See Vess, 317 F.3d at 1106. Rule 9(b) also bars Tran

from pleading fraud-based claims against multiple defendants without identifying which specific

defendant is responsible for what specific alleged fraudulent conduct or misrepresentation. See

Destifino v. Rieswig, 630 F.3d 952, 958 (9th Cir. 2011) (quoting Cisneros v. Instant Capital

Funding Grp., Inc., 263 F.R.D. 595, 606-07 (E.D. Cal. 2009) (Rule 9(b) does not allow a

complaint to . . . lump multiple defendants together but require[s] plaintiffs to differentiate their

allegations when suing more than one defendant.).


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In violation of these basic requirements, throughout the Complaint Tran improperly and

conclusorily lumps the defendants together, alleging, for example, that Defendants are

Americas largest provider of wireless telecommunications services, (Compl., 2:11-12; emphasis

added), [Defendants] promote themselves as having superior service, (id., 2:12; emphasis

added), [o]ver the years nationwide advertising campaigns have stated that they [Defendants]

have the fewest dropped calls, more bars in more places, and the fastest mobile broadband

network, (id., 2:12-14; emphasis added). Plaintiff also claims that Defendants have

aggressively marketed their service to users of smartphones . . . knowing their network

infrastructure could not possibly accommodate the demands the increased usage would cause.

(Id., 2:19-22; emphasis added.)

Additionally, Tran attaches as Exhibits B through K of the Complaint, various

advertisements and websites relating to ATTMs wireless service, but fails to identify the source

of these documents, the dates they were each created, or the specific statements in them that

support his claim that Defendants alleged acts, omissions, and/or statements were fraudulent. He

also never alleges that he saw or relied upon these documents in purchasing ATTM service.

Similarly, Tran alleges that he spoke individually with AT&T regarding the service

issues [he] encountered and that AT&T made various representations to him concerning the

reasons for the service issues. (Compl., 52.) Tran claims that he stuck with AT&T in reliance

upon their public and private assurances that overall service quality was superb, and that any

problems [Tran] experienced were isolated and being diligently addressed. (Compl., 3:5-7.)

Despite this conclusory allegation of reliance, Tran fails to identify when this conversation(s)

took place or to whom he spoke to allow Defendants to defend against these claims.

For all of these reasons, Trans fraud-based claims fail under Rule 9(b).

3. To The Extent Trans Misrepresentation Claim Is Based On GeneralAdvertising Statements of Opinion, The Court Should Dismiss ThatClaim Because Those Statements Are Non-Actionable As A Matter OfLaw

Even assuming Trans negligent and intentional misrepresentation claim (Count 5) could

withstand the strict pleading standards of Rule 9(b), which it cannot, that claim fails to the extent


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it relies on general advertising statements made to the public because, under California law, those

alleged marketing or advertising misrepresentations are non-actionable statements of opinion

For example, Tran asserts that Defendants made the following alleged misrepresentations:

users would experience the fewest dropped calls, (Compl., 93);

user would experience . . . the fastest wireless broadband network,

(id.);

that their [Defendants] services [sic] was of high quality and reliability,

(id.);

that Defendants had more bars in more places, (id., 2:14); and

that [Defendants] network is the nations fastest, (id., 47).

The Ninth Circuit has held that generalized statements of opinion such as these are non-

actionable as a matter of law. See, e.g.,Glen Holly Entmt, Inc. v. Tektronix Inc., 343 F.3d 1000

1015 (9th Cir. 2003) (dismissed plaintiffs misrepresentation claims as to certain generalized

vague statements describing the high priority Tektronix placed on product development and

alluding to marketing efforts because no reasonable consumer would have relied on such vague

and unspecific assertions). Numerous district courts in the Ninth Circuit have similarly found

that these types of generalized claims of superiority of ones own product are simply statements

of opinion and are non-actionable as a matter of law. See, e.g., In re Sony Grand Wega KDF-E

A10/A20 Series Rear Projection HDTV Television Litig. (In re Sony), --- F.Supp.2d ----, Nos

08-CV-2276-IEG (WVG), 09-CV-0620-IEG (WVG), 09-CV-0736-IEG (WVG), 09-CV-2703-

IEG (WVG), 2010 WL 4892114 at *5 (S.D. Cal. Nov. 30, 2010) (Vague or highly subjective

claims about product superiority are non-actionable. . . ; only misdescriptions of specific or

absolute characteristics of a product are actionable.) (quoting Southland Sod Farms v. Stover

Seed Co., 108 F.3d 1134, 1145 (9th Cir. 1997)). See also Haskel v. Time, Inc., 857 F. Supp. 1392

(E.D. Cal 1994) (granting Rule 12(b)(6) motion to dismiss claims for violations of 17200 and

17500 on grounds that alleged deceptive advertisements were, as a matter of law, nonactionable

statements of opinion); Oestericher v. Alienware Corp., 544 F. Supp. 2d 964, 973 (N.D. Cal

2008) (advertising defendants computers as faster, more powerful, and more innovative


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than other machines was nonactionable).

In In re Sony, plaintiffs were a group of individuals who purchased and used Sony Grand

WEGA KDF-E A10 and A20 Series televisions that were manufactured by Defendants and

offered for sale beginning in the second half of 2005. . . . 2010 WL 4892114 at *1. Sony

marketed the televisions as offering superior picture quality to that of standard televisions and

being capable of taking full advantage of High-Definition Television (HDTV) programming.

Id. The plaintiffs in In re Sony sued under the UCL, FAL and CLRA based on the following

allegations:

(1) at the time Plaintiffs purchased the televisions, Sony was aware

that the televisions optical block suffered from a latent defect that

would negatively affect the quality of the images displayed by the

televisions; (2) despite its awareness of the defect, Sony, in

advertisements and other marketing materials, misrepresented the

quality of the televisions by claiming they were of high,

superior, and excellent quality; that the televisions offered a

picture quality far superior to that offered by standard televisions;

and that the televisions were able to take full advantage of HDTV

programming and to reproduce video programs with a clear picture

and accurate color reproduction; (3) Sony omitted any mention of

the defect to consumers; (4) Sonys claims about the televisions

quality induced consumers to pay $2,500 or more for the

televisions; and (5) rather than function as Sony advertised, the

televisions eventually displayed colorful spots and other blemishes

that interfered with the picture.

Id. at *4.

The court in In re Sony found all of the general, vague advertisement statements alleged

by the plaintiffs as support for their UCL, FAL and CLRA fraud and misrepresentation claims to

be insufficient to support those claims. Generalized, vague, and unspecified assertions are not


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the type of statements upon which a reasonable consumer could not rely, and hence are not

actionable. Id., at *4 (citing Oestreicher v. Alienware Corp., 544 F.Supp.2d 964, 973 (N.D. Cal

2008).

Here, as in In re Sony and the other cases cited above, Tran has not alleged that

Defendants made any misstatements about absolute characteristics of their wireless service

Instead, Tran relies in large part on the generalized, vague advertising statements to support his

misrepresentation claims. To the extent he does so, his misrepresentation claims should be

dismissed.

C. Trans Claims For Intentional And Negligent Misrepresentation AreDefective Because Tran Does Not Allege The Required Reliance.

Trans fraud by intentional and negligent misrepresentation claim (Count 5) also fails

because Tran has not satisfied his burden of pleading reasonable or justifiable reliance. See

Alliance Mortgage Co. v. Rothwell, 10 Cal. 4th 1226, 1239 (1995) (justifiable reliance is a

required element of both intentional and negligent misrepresentation claims). Tran has not pled

the necessary reliance to support his misrepresentation claims for at least two reasons. First

ATTM disclosed to him the limitations on network performance about which he claims he was

misled. Second, Tran does not allege that he heard or saw the alleged misrepresentations or

misleading advertisements prior to purchasing his AT&T smartphone and commencing service

with ATTM in July 2009.

1. ATTM Disclosed Limitations On Network Performance.Tran pleaded that his service was governed by terms that include the following language:

Service Availability and Access/Coverage. AT&T does not

guarantee availability of wireless network. Services may be

subject to certain equipment and compatability/limitations

including memory, storage, network availability, coverage,

accessibility and data conversion limitations. Services (including

without limitation, eligibility requirements, plans, pricing, features

and/or service areas) are subject to change without notice. When


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outside coverage area, access will be limited to information and

applications previously downloaded to or resident on your device.

Coverage areas vary between AT&T BroadbandConnect, EDGE

and GRPS. AT&T BroadbandConnect only available in select

markets. See coverage map(s), available at store or from your

sales representative, for details. AT&T BroadbandConnect

download speeds only available on the AT&T BroadbandConnect

network. Actual download speeds depend upon device

characteristics, network, network availability and coverage levels,

tasks, file characteristics, applications and other factors.

Performance may be impacted by transmission limitations, terrain,

in-building/in-vehicle use and capacity constraints.

(Compl., 23 and Ex. A, p. 8; emphasis added.)5 [A] court may consider material which is

properly submitted as part of the complaint on a motion to dismiss. . . . Lee v. City of Los

Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (citing Branch v. Tunnell, 14 F.3d 449, 453 (9th Cir

1994)).

Because Tran was apprised of the possibility of the type of network limitations that he

now claims to have been misled about, he cannot claim to have reasonably relied on the alleged

misrepresentations. SeeYazdanpanah v. Sacramento Valley Mortgage Group, No. C 09-02024

SBA, 2009 WL 4573381 at *4 (N.D. Cal. Dec. 1, 2009) (plaintiff cannot claim reasonable

reliance on misrepresentations that are contrary to the express terms of the contract); Fanucci v

Allstate Ins. Co., 638 F. Supp. 2d 1125, 1141-42 (N.D. Cal. 2009) (same).

2. Trans Conclusory Allegations of Reliance Are Inadequate.Tran also fails to adequately plead reliance because he does not allege that he saw or

heard, much less relied upon, many of the alleged misrepresentations prior to purchasing his

5 Tran concedes that the Terms of Service attached to the Complaint as Exhibit A aresubstantially similar to the wireless service agreement he entered into with AT&T. (Compl. 23.)


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device or commencing ATTM service. See Mirkin v. Wasserman, 5 Cal. 4th 1082, 1111 (1993)

(Reliance is an essential element of a fraud cause of action.). While even indirec

communications of misrepresentations may be actionable, the plaintiff must show that those

indirect communications actually came specifically to his or her attention. See id., 5 Cal. 4th at

1095. Trans boilerplate allegations of reliance are insufficient to satisfy his pleading burden

For example, Tran alleges that he acted in justifiable reliance upon the truth of the

misrepresentations . . . and would not have entered into the Wireless Service Agreements . . . if

[he] had known the true facts. (Compl., 98-99.) Nowhere in the Complaint does Tran allege

that he personally saw or heard the allegedly misleading advertising, or that it was specifically

brought to his attention and he relied on it when purchasing his smartphone device or subscribing

to AT&T Wireless Service. Moreover, given the apparent significant media attention concerning

the alleged service coverage issues (as Trans own Exhibits B through K purport to represent)

Tran cannot credibly allege that his reliance on AT&Ts marketing campaign was justifiable

See, e.g., Mirkin, 5 Cal. 4th at 1111 ([R]eliance is proved by showing that the defendants

misrepresentation or nondisclosure was an immediate cause of the plaintiffs injury-producing

conduct . . . [which may be established] by showing that in its absence the plaintiff in all

reasonable probability would not have engaged in the injury-producing conduct.) (quoting

Molko v. Holy Spirit Assn., 46 Cal.3d 1092, 1108 (1988)). Since Tran cannot sufficiently plead

reliance on the alleged misrepresentations, the Court should dismiss his fraud by intentional and

negligent misrepresentation claim (Count 5).

D. The Court Should Also Dismiss Trans Claim for Fraud By ConcealmentBecause He Has Not Sufficiently Alleged That Defendants Breached A LegalDuty To Disclose The Facts Allegedly Concealed

Trans fraud by concealment claim (Count 6) also fails because he has failed to

sufficiently allege that Defendants or either of them breached a legal duty to disclose the

allegedly concealed facts to him, as required by California law to maintain such a claim. OCM

Principal Opportunities Fund v. CIBC World Markets Corp., 157 Cal. App. 4th 835, 845 (2007)

(quoting Lingsch v. Savage, 213 Cal. App. 2d 729, 735 (1963) ([T]o establish fraud through

nondisclosure or concealment of facts, it is necessary to show the defendant was under a legal


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duty to disclose them.)

Tran alleges in his Complaint that Defendants have never provided notifications to [him]

that AT&T Wireless Service suffers [from] quality or reliability problems in any major region of

their claimed service area. (Compl., 45.) Tran also alleges that AT&T has not met their

obligation to inform [him] of significant quality and reliability problems they experience with

their network. (Id., 55.) However, the Terms of Service attached as Exhibit A to the

Complaint do, in fact, expressly notify customers that AT&T does not guarantee availability of

wireless network. Services may be subject to certain equipment and compatability/limitations

including memory, storage, network availability, coverage, accessibility and data conversion

limitations. (Compl., Ex. A, p. 8; emphasis added.)

As such, Defendants have, in fact, made clear disclosures of potential service quality

issues as demonstrated by Trans own Exhibit A the Court should dismiss Trans claim for

fraud by concealment.

E. The Court Should Dismiss Trans Statutory Consumer Protection Claims ForFailure To Plead Required Elements Of Those Statutes.

Trans claims for violation of the consumer protection statutes of California should also be

dismissed because Tran fails to plead required elements of those statutes.1. Trans FAL and CLRA Claims Fail To Allege A Causal Connection

Between Defendants Alleged Conduct And The Alleged Harm

Tran fails to state a claim under the FAL or CLRA because he does not adequately plead a

causal connection between Defendants alleged acts or omissions and his alleged harm. The FAL

limits relief to any person who has suffered injury in fact and has lost money or property as a

result ofsuch unfair competition. Cal. Bus. & Prof. Code 17535 (emphasis added). Likewise

relief under the CLRA is limited to [a]ny consumer who suffers any damage as a result of the

use or employment by any person of a method, act, or practice unlawful under the act. Cal. Civ

Code 1780(a) (emphasis added). California courts have held that this language places the

burden on plaintiffs to show not only that the defendants conduct was deceptive, but that such

deception caused their alleged injuries. See Kwikset Corp. v. Super. Ct., 51 Cal. 4th 310, 120


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Cal. Rptr. 3d 741, 754 (Cal. 2011) ([A] plaintiff must show that the misrepresentation was an

immediate cause of the injury-producing conduct. . . .). See alsoLaster v. T-Mobile USA, Inc.

407 F. Supp. 2d 1181, 1194 (S.D. Cal. 2005) (stating that because Plaintiffs fail to allege they

actually relied on false or misleading advertisements, they fail to adequately allege causation in a

case alleging UCL, FAL, & CLRA claims); Cohen v. DIRECTV, Inc., 178 Cal. App. 4th 966

979-80, 101 Cal. Rptr. 3d 37, 47-48 (Cal. Ct. App. 2009) (stating that a showing of actual reliance

on misrepresentations must be established to maintain a CLRA action and that a claimant must

show actual exposure to the allegedly wrongful business practices under the UCL). See also

Stickrath v. Globalstar, Inc., 527 F. Supp. 2d 992, 996 (N.D. Cal. 2007) (granting motion to

dismiss UCL and CLRA claims for lack of standing where plaintiffs allegations regarding

causation are merely conclusory).

Tran has alleged that Defendants engaged in a fraudulent course of conduct by

aggressively market[ing] (Compl., 2:19) their wireless service even though they allegedly knew

their network infrastructure could not possibly accommodate the demands the increased usage

would cause, (id., 2:21-22). However, though Tran alleges this general course of fraudulent

conduct by the Defendants to the public at large, as well as some alleged individual

communications between Plaintiffs and AT&T, he has failed to allege (1) specifically that he,

Tran, had any of those individual communications, or (2) specifically what statements, acts,

omissions, or advertisements, he relied on when he purchased his device and subscribed to AT&T

service. As such, since Tran has not properly pled such a causal connection (nor can he given the

specific disclosure of potential service quality issues made to Tran in Exhibit A to the Complaint,

his FAL and CLRA claims fail and should be dismissed.

2. Trans CLRA Claim Should Be Dismissed Because Tran Has Failed ToFile The Affidavit Required Under Section 1780(d) Of The CLRA

Section 1780(d) of the CLRA states:

In any action subject to this section, concurrently with the filing of

the complaint, the plaintiff shall file an affidavit stating facts

showing that the action has been commenced in a county described


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in this section as a proper place for the trial of the action. If a

plaintiff fails to file the affidavit required by this section, the court

shall, upon its own motion or upon motion of any party, dismiss

the action without prejudice.

Civ. Code 1780(d).

Plaintiff has failed to file the required affidavit and therefore his CLRA claim must be

dismissed under Section 1780(d). See In re Sony, supra, 2010 WL 4892114 at *10 (dismissing

action because only one of 47 plaintiffs had filed the required affidavit).

3. Trans CLRA Claim Should Be DismissedWith Prejudice Because,Despite Seeking Monetary Damages In His Complaint, He Failed ToProvide The Pre-Lawsuit Notice Required Under Section 1782 Of The

CLRA

Section 1782 of the CLRA requires that, thirty days prior to filing suit, a plaintiff must do

the following:

(1) Notify the person alleged to have employed or committed

methods, acts or practices declared unlawful by Section

1770 of the particular alleged violations of Section 1770.

(2) Demand that the person correct, repair, replace or otherwise

rectify the goods or services alleged to be in violation of

Section 1770.

Civ. Code 1782(a)(1)-(2). The notice must be in writing and must sent via certified o

registered mail to the place where the transaction occurred or to the persons principal place o

business withinCalifornia. Id. , 1782(a) (emphasis added).

Attached to the Complaint as Exhibit L is a letter dated July 26, 2010 from Trans counsel

Lenza H. McElrath III, to AT&T Mobilitys General Counsel (directed to an address in Atlanta

Georgia) and to AT&T Mobility Customer Care (directed to an address in Artesia, California)

(See D.E. 1-2, pp. 24-25.) However, this letter fails to satisfy the pre-lawsuit notice required

under Section 1782 for the following reasons: (1) it makes no mention that Mr. McElrath

represents Tran; (2) it does not indicate that it was sent via certified or registered mail; (3) it was


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not directed to AT&T Mobilitys principal place of business in California or where the transaction

occurred (which, based on the allegations, is the Bay Area of California); and (4) it makes no

mention of the specific provisions of the CLRA that he claims have been violated, much less any

mention of the CLRA at all. Substantial compliance with the statute will not suffice. SeeVon

Grabe v. Sprint PCS, 312 F. Supp. 2d 1285, 1303 (S.D. Cal. 2003) (dismissing plaintiffs CLRA

with prejudice for failure to strictly comply with Section 1782s notice requirements).

For all of these reasons, Tran has failed to comply with Section 1782 of the CLRA and his

CLRA claim should be dismissed with prejudice.

F. The Court Should Dismiss Trans Negligent Misrepresentation ClaimBecause It Is Barred By The Economic Loss Doctrine

California applies the economic loss rule, which bars Trans negligent misrepresentation

claim. Under the economic loss rule, where the relationship between the parties to a lawsuit is

governed by a contract, a plaintiff may not recover in tort for purely economic damages absent

the allegation of some independent, extra-contractual duty owed to them by the defendant. See

Robinson Helicopter Co., Inc. v. Dana Corp., 34 Cal. 4th 979, 988, 22 Cal. Rptr. 3d 352, 357-58

(Cal. 2004) (Quite simply, the economic loss rule prevent[s] the law of contract and the law of

tort from dissolving one into the other.).

Here, the contractual relationship between ATTM and Tran triggers the economic loss

doctrine. Tran claims he purchased a smartphone device and subscribed to ATTMs wireless

phone service and entered into a contract with ATTM for that service (Compl., 17), but was

dissatisfied with the quality of that wireless service and alleges to have suffered economic harm

as a result (see, e.g., id., 35). Any damages that could be awarded based on those allegations

are the same damages available in a breach of contract action under Trans contract with ATTM

claims which he has also alleged (see Counts 1 and 2). The Court should therefore dismiss Trans

tort claims as barred by the economic loss doctrine.

G. The Court Should Dismiss Trans Breach of Contract/Warranty Claims.Trans breach of express and implied warranty claims also fail because Tran does not

allege any facts establishing a breach by ATTM. While Tran generically asserts claims agains


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Defendants for breach of warranty, Tran has failed to specifically allege in light of the service

limitation provision in ATTMs Terms of Service (Compl., Exh. A) what the specific warranty

that he is suing under provided for, where and when it was conveyed to him, and specifically how

Defendants breached it. California law requires Tran to make these specific allegations to suppor

his breach of warranty claim. See Williams v. Beechnut Nutrition Corp., 185 Cal. App. 3d 135

142, 229 Cal. Rptr. 605, 608 (1986) (to properly plead the elements of a breach of express

warranty claim in California, one must allege the exact terms of the warranty, plaintiff's

reasonable reliance thereon, and a breach of that warranty which proximately causes plaintiff

injury.). Because Tran has not alleged specific facts identifying the warranty that he is suing

under or how Defendants allegedly breached it (in light of the service limitation language in the

ATTM Terms of Service), Trans claims for breach of warranty fail and should be dismissed.

IV. CONCLUSIONDefendants respectfully requests that the Court dismiss all of Trans claims with prejudice

under Federal Rule of Civil Procedure 12(b)(6).

DATED: March 31, 2011 CROWELL & MORING LLP

By: /s/ Theresa C. LopezSteven P. RiceTheresa C. Lopez

Attorneys for DefendantsAT&T Mobility and AT&T, Inc.


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PROOF OF SERVICE

STATE OF CALIFORNIA, COUNTY OF ORANGE

At the time of service, I was over 18 years of age and not a party to this action. I amemployed in the County of Orange, State of California. My business address is 3 Park Plaza, 20thFloor, Irvine92614-8505 California, .

On March 31, 2011, I served true copies of the following document(s) described as

NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT AS TO PLAINTIFFANTHONY P. TRAN; MEMORANDUM OF POINTS AND AUTHORITIES

on the interested parties in this action as follows:

SEE ATTACHED SERVICE LIST

BY CM/ECF NOTICE OF ELECTRONIC FILING: I caused said document(s) to beserved by means of this Courts electronic transmission of the Notice of Electronic Filing

through the Courts transmission facilities, to the parties and/or counsel who are registeredCM/ECF Users set forth in the service list obtained from this Court.

COURTESY COPY BY ELECTRONIC MAIL: I caused a true copy of the foregoingdocument to be sent via electronic mail in .PDF format.

I declare under penalty of perjury under the laws of the United States of America that theforegoing is true and correct and that I am a member of the bar of this Court.

Executed on March 31, 2011, at Irvine, California.

/s/ Theresa C. LopezTHERESA C. LOPEZ


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SERVICE LISTBlau v. AT&T Mobility, et al.Case No. CV 11-00541 CRB

Lenza H. McElrath III

[email protected] at Law3637 18th Street, Suite #2San Francisco, CA 94110Telephone: (216) 920-1997Facsimile: (510) 550-7820

Attorney for Plaintiffs

DCACTIVE-14873810.1

2011.03.31 at&t's motion to dismiss

Documents