Opinion
No. C 10-5282 RS.
October 27, 2011
ORDER GRANTING MOTION TO DISMISS FIRST AMENDED COMPLAINT WITHOUT LEAVE TO AMEND
I. INTRODUCTION
This is a putative class action challenging the alleged practice of defendant Facebook, Inc. of promoting its "Friend Finder" feature by disclosing to users that their Facebook "friends" have used that function. The central question presented by this motion to dismiss the First Amended Complaint ("FAC") is whether the use of the names and likenesses of non-celebrity private individuals without compensation or consent causes injury sufficient to support standing, where plaintiffs cannot allege that their names and likenesses have any general commercial value, and they have not chosen to allege that they suffered any distress, hurt feelings, or other emotional harm. As plaintiffs have failed to plead a cognizable injury, the motion will be granted, without leave to amend.
II. LEGAL STANDARD
A complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). While "detailed factual allegations are not required," a complaint must include sufficient facts to "state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 US 544, 570 (2007)). A claim is facially plausible "when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id.
A motion to dismiss a complaint under Rule 12(b)(6) of the Federal Rules of Civil Procedure tests the legal sufficiency of the claims alleged in the complaint. See Parks Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). Dismissal under Rule 12(b)(6) may be based either on the "lack of a cognizable legal theory" or on "the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988). When evaluating such a motion, the court must accept all material allegations in the complaint as true, even if doubtful, and construe them in the light most favorable to the non-moving party. Twombly, 550 US at 570). "[C]onclusory allegations of law and unwarranted inferences," however, "are insufficient to defeat a motion to dismiss for failure to state a claim." Epstein v. Wash. Energy Co., 83 F.3d 1136, 1140 (9th Cir. 1996); see also Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 US at 555 ("threadbare recitals of the elements of the cause of action, supported by mere conclusory statements," are not taken as true).
III. DISCUSSION
The factual background of this action was set forth in the order dismissing the original complaint, and will not be recounted here.
1. The prior dismissal
Facebook challenged the original complaint in this action by arguing that under the terms of use agreements applicable to Facebook accounts, plaintiffs had effectively consented to the use of their names and likenesses in the manner that they are now contending was wrongful. The prior order concluded that issue could not be decided in Facebook's favor at the pleading stage, and the argument has not been reasserted in this motion. The initial motion to dismiss, however, also argued that plaintiffs had alleged no facts to support any cognizable harm, and it was granted on those grounds. The order observed that the sole allegation of injury was a conclusory assertion that plaintiffs, "have suffered injury-in-fact by having their name[s] and likeness[es] misappropriated without their knowledge or consent." June 27, 2011 Order at 8:26-9:1.
The order rejected plaintiffs' apparent argument that the availability of minimum statutory damages under California Civil Code § 3344 could, in and of itself, supply the requisite element of injury. Noting that the Civil Code provision appeared designed primarily to provide a remedy for those whose actual damages might be difficult to quantify, such as plaintiffs who were claiming only non-economic damages, the order stated, "plaintiffs must, at a minimum, plead that they suffered mental anguish as a result of the alleged misappropriation, and a plausible supporting factual basis for any such assertion." See June 27, 2011 Order at 9:18-20 (citing Miller v. Collectors Universe, Inc., 159 Cal.App.4th 988 (2008)).
A large portion of plaintiffs' opposition to the present motion is devoted to rebutting the proposition that non-celebrity plaintiffs may recover for misappropriation of their names and likenesses only if they can plead that they suffered mental anguish. Plaintiffs argue that any implication in Miller to that effect was ill-considered dicta, and that the June 27, 2011 Order was erroneous in suggesting that plaintiffs can only proceed under a theory that they suffered emotional harm. As Facebook correctly points out, however, plaintiffs are reading the June 27, 2011 Order too narrowly. Because plaintiffs had not identified or clearly articulated any economic harm they had allegedly suffered, the order merely explained what allegations would be necessary for them to state a claim for non-economic harm. Nothing in the June 27, 2011 Order, nor in Miller, represents a holding that non-celebrity plaintiffs can never pursue claims for economic loss and are instead limited to emotional damages. Facebook fully and correctly acknowledges that even non-celebrity plaintiffs may pursue economic damages claims. The question is what kind of facts must be alleged to show the existence of economic damages, such that plaintiffs will have standing to proceed.
Indeed, at the hearing on the initial motion to dismiss, plaintiffs indicated they were claiming emotional harm, and that they could amend to state facts showing such harm with greater specificity.
2. The new allegations
In the FAC, plaintiffs have elected not to claim emotional distress damages. Instead, plaintiffs have articulated in more detail the theory that their names and likenesses had an economic value to Facebook, as evidenced by the fact that Facebook chose to use them to promote its "Friend Finder" service. Facebook argues that the FAC, and plaintiffs' opposition to the present motion, are more in the nature of a motion for reconsideration than an attempt to cure the pleading defect identified in the prior order. Indeed, because plaintiffs have chosen to proceed on the theory that they have cognizable economic interests in their names and likenesses, despite not being celebrities, they are to some extent re-arguing positions they took in the prior motion, albeit with greater focus.
Facebook continues to point out that there is no requirement that its users post their actual likenesses as "profile pictures," and that many do not do so. Although that might present an impediment to class certification, it does not serve as a basis to dismiss the claims.
Facebook also contends that the allegations of harm remain unduly conclusory in the FAC. It is true that plaintiffs have added few, if any, new allegations that could be fairly characterized as facts. They have, however, set out with greater clarity that their claim is based on a purported legal right of publicity in their own names and likenesses, which they contend exists without regard to whether or not their names and likenesses have any general commercial value. The FAC further explains how Facebook's use of plaintiffs' names and likenesses can be seen as serving a commercial purpose, undertaken with at least the intent of achieving growth in Facebook's user base, thereby ultimately resulting in monetary gain for Facebook. While some of these additional allegations thereby arguably could be characterized as legal conclusions or argument, under the particular circumstances of this case, they serve the legitimate purpose of "showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). Additionally, given the nature of the claims that plaintiffs are advancing, there are no other or further "facts" to be added. Either plaintiffs' theory of harm is sufficient to give rise to standing or it is not; the issue is no longer merely that the allegations are too "conclusory."
There is no dispute that Facebook charges no fees for the services it provides to its members, and therefore does not directly benefit financially from increasing its user basis. There is also no dispute, however, that Facebook operates as a for-profit business, and that the advertising revenues it derives depend at least in part on the number of people who utilize its services.
Among other things, it is now clear that plaintiffs are not basing their claims on inadequately-pleaded emotional distress.
3. Sufficiency of the injury
While plaintiffs have more clearly articulated the basis for their claim, they still have failed to make a sufficient "showing" that they are "entitled to relief." Fed.R.Civ.P. 8(a)(2). The cases on which plaintiffs rely are distinguishable. In KNB Enterprises v. Matthews, 78 Cal.App.4th 362 (2000), for example, the plaintiff sought to assert claims under California Civil Code § 3344 on behalf of 452 individuals whose photographs had been used by defendant without consent or compensation. Although the individuals did not have celebrity status, they were engaged in the business of modeling. As such, they could show a commercial interest in their likenesses from which they had attempted to profit. See also, Del Amo v. Baccash, 2008 WL 4414514 (C.D. Cal. 2008) (non-celebrity nude models); Christoff v. Nestle USA, Inc., 47 Cal. 4th 468 (2007) (non-celebrity model). While the plaintiff in Smith v. NBC Universal, 524 F.Supp.2d 315 (S.D.N.Y. 2007), was neither famous nor a model, he was a public performer and entertainer with an obvious economic interest in his likeness unlike anything plaintiffs have alleged here.
The individuals had assigned those claims to the plaintiff.
Plaintiffs' reliance on Smith is also curious because, contrary to their assertion, the court granted summary judgment against the plaintiff on his publicity claims. 524 F.Supp.2d at 329.
It is also worth noting that this is not a situation where the defendant is alleged to have publicized the plaintiffs' names or likenesses to any audience or in any context where they did not already appear — rather, the names and likenesses were merely displayed on the pages of other users who were already plaintiffs' Facebook "friends" and who would regularly see, or at least have access to, those names and likenesses in the ordinary course of using their Facebook accounts. While the prior order rejected Facebook's argument that it could not be said to have used the names and likenesses to its own "advantage," this further undercuts any claim plaintiffs can make that they were somehow harmed.
The fact that the California Legislature has provided for statutory damages in the amount of $750 for a individual who is unable to quantify the amount of damages suffered does not eliminate the requirement of a cognizable injury in the first instance. Because plaintiffs have not shown any such injury, the motion to dismiss must be granted. As plaintiffs have effectively conceded that there are no additional or different facts they can allege, leave to amend is not warranted.
The lack of cognizable injury is fatal to plaintiffs' claim under Civil Code § 3344 despite the provision for statutory damages. Even if the existence of statutory damages were sufficient to support that claim, however, the common law claim would fail. So too would the claim under California's Unfair Competition Law, which requires that a plaintiff suffer a loss of "money or property" — a standing requirement more restrictive than that imposed by the Constitution. See Kwikset Corp. v. Superior Court, 51 Cal.4th 310, 323-324 (2011).
IV. CONCLUSION
The motion to dismiss is granted, without leave to amend. A separate judgment will issue.
IT IS SO ORDERED.