Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_19-cv-03795/USCOURTS-cand-4_19-cv-03795-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 47:227 Restrictions of Use of Telephone Equipment

---

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

United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

RICHARD KOMAIKO, et al.,

Plaintiffs,

v.

BAKER TECHNOLOGIES, INC., et al.,

Defendants.

Case No. 19-cv-03795-DMR 

ORDER ON DEFENDANTS’ MOTION 

TO DISMISS

Re: Dkt. No. 34

Plaintiffs Richard Komaiko and Marcie Cooperman are named representatives in this 

putative class action against Defendants Baker Technologies, Inc. (“Baker”) and Tilt Holdings Inc. 

(“TILT”). [Docket No. 29 (“FAC”).] Plaintiffs assert claims for violations of the Telephone 

Consumer Protection Act, 47 U.S.C. § 227 et seq. (“TCPA”) and California’s Unfair Competition 

Law, Cal. Bus. & Prof. Code § 17200 et. seq (“UCL”). Defendants move to dismiss the operative 

complaint pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6). [Dockets No. 34 

(“Mot.”), 41 (“Reply”).] Plaintiffs filed a timely opposition. [Docket No. 38 (“Opp.”).] The court 

held a hearing on January 23, 2020. 

For the reasons stated below, Defendants’ Rule 12(b)(2) motion is granted in part and denied 

in part. Defendants’ Rule 12(b)(6) motion is denied. 

I. BACKGROUND

Plaintiffs are residents of Los Angeles, California. FAC ¶¶ 111-12. Baker is a Delaware 

corporation with its principle place of business in Denver, Colorado. Id. ¶ 113; Docket No. 34-1, 

Declaration of Joel Milton in Support of Motion to Dismiss (“Milton Decl.”) ¶ 2. TILT is a publiclytraded Canadian corporation with a principal place of business in Cambridge, Massachusetts. 

Docket No. 34-2, Declaration of Tim Conder in Support of Motion to Dismiss (“Conder Decl.”) ¶ 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 1 of 30
2

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

United States District Court

Northern District of California

2.

A. Defendants’ Corporate Relationship

On July 9, 2018, Baker entered into a Business Combination Agreement (“BCA”) with Santé 

Veritas Holdings Inc., a Canadian corporation (“SVT”); Sea Hunter Therapeutics, LLC, a Delaware 

limited liability company (“Sea Hunter”); Briteside Holdings, LLC, a Tennessee limited liability 

company (“Briteside”), and 1167411 B.C. LTD., a British Columbia corporation (“Finco”).1 

Defendants submitted a full copy of the BCA. [Docket No. 34-4, Declaration of Cynthia A. Castillo 

in Support of Motion to Dismiss (“Castillo Decl.”), Ex. A (“BCA”).] TILT Holdings, Inc. (“TILT 

Holdings”) was organized and incorporated by SVT in Nevada to “effect the transactions 

contemplated” in the BCA. BCA at 12. In turn, TILT Holdings organized and incorporated TILT 

Holdings US, Inc. (“TILT US”) as a Nevada corporation and as a wholly-owned subsidiary of TILT 

Holdings.2 BCA at 14. 

The BCA contemplated that TILT Holdings would become a British Columbian corporation 

by way of conversion, and that Baker, SVT, Sea Hunter, Briteside, and Finco would be owned by 

TILT (the defendant in this action), the Canadian successor corporation to TILT Holdings. BCA at 

12, 15; see also Milton Decl. ¶ 11. Specifically, the BCA intended that TILT would be the direct 

parent entity of Baker and SVT, while Baker would in turn be the parent entity of Sea Hunter and 

Briteside. BCA at 15. As part of this series of transactions, Baker merged with TILT US, with 

Baker continuing as the surviving corporation. BCA at 3, 14; Milton Decl. ¶¶ 6, 9. TILT’s parentsubsidiary structure is reflected in the listing statement that TILT submitted to the Canadian 

Securities Exchange upon its conversion: 

1 Milton explains that Finco was “formed for the purposes of a concurrent financing.” Milton Decl. 

¶ 8.

2 The BCA refers to TILT Holdings as “Nevada HoldCo” and to TILT US as “Nevada MergeCo.” 

See BCA at 12, 14.

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 2 of 30
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

United States District Court

Northern District of California

[Docket No. 40, Declaration of Peter Roldan in Opposition to Motion to Dismiss (“Roldan Decl.”), 

Ex. B (“Listing Statement”) at 16-17.]

After the conversion, TILT formed Jimmy Jang, L.P., a Delaware limited partnership 

(“Jimmy Jang”) for the purpose of acquiring a different limited liability corporation. Milton Decl. 

¶¶ 6, 9. TILT owns approximately 85% of the limited partnership units of Jimmy Jang and the 

general partner of Jimmy Jang, Jimmy Jang Holdings Inc., is a wholly-owned subsidiary of TILT. 

Id. ¶ 9. Baker is now wholly owned by Jimmy Jang. Id. ¶ 15. In sum, TILT owns 85% of the 

partnership units of Jimmy Jang, and Jimmy Jang in turn owns 100% of Baker.

Figure 1 - Pre-Business Combination

Figure 2 - Post-Business Combination (Partial)

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 3 of 30
4

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

United States District Court

Northern District of California

B. Baker’s Operations

Baker provides a customer relationship marketing (“CRM”) platform for over 900 cannabis 

dispensaries throughout Canada and the United States. FAC ¶ 19; Milton Decl. ¶ 3. Baker’s 

software offerings include applications such as “Checkin,” which collects customer information 

through an in-store tablet; “Cell Collect,” which collects customer information through the client 

dispensaries’ websites; and “Connect,” which allows clients to send customers text messages 

through an automatic telephone dialing system (“ATDS”). FAC ¶¶ 22-24, 28. Checkin and Cell 

Collect harvest consumer data such as cell numbers while Connect uses that data to send 

telemarketing texts. See id. ¶¶ 22-28.

Plaintiffs allege that Baker “supplies, procures, and controls the necessary software, 

computers, telecommunications, services, and automated dialing capabilities needed to 

make/initiate texts” through Connect. FAC ¶ 29. Baker also offers technical support for Connect, 

verifies that the cell numbers provided by the consumers are valid, and tells the client dispensaries 

how many total text messages will be sent. Id. ¶¶ 30-31. Baker allegedly works with client 

dispensaries to “evaluate the effectiveness of text messages, to decide the best time to send text 

messages in order to reduce the unsubscribe rate on text messages, to determine the types of deals 

to offer in messages, and to revise the content of text messages in order to increase effectiveness.” 

Id. ¶ 32. Plaintiffs aver that client dispensaries generate text content and tell Baker when they want 

the texts to be sent, while Baker stores the drafted text messages on its servers and sends the texts 

at the times and dates requested by the clients. Id. ¶ 33. Once the texts are sent, Baker provides 

data to the dispensaries about the reach of and responses to the messages. Id. ¶ 34. According to 

Plaintiffs, Baker has represented to its clients that collecting information and sending messages 

through its applications is legal. Id. ¶ 38. Plaintiffs claim that Baker’s applications did not collect 

prior express consent from customers until sometime in mid-2018 at the earliest. Id. ¶ 39.

The complaint alleges that Baker has “expanded its business into the California market,” in 

part through funds from California-based venture capital firms. FAC ¶ 84. Plaintiffs claim that Joel 

Milton, the CEO of Baker, splits his time between San Francisco and Denver. Id. ¶ 85. Baker has 

also allegedly hosted a booth at a California trade show for cannabis businesses. Id. ¶ 86. 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 4 of 30
5

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

United States District Court

Northern District of California

C. Text Messages

1. Colorado Dispensaries

In April 2016, Komaiko visited two cannabis dispensaries in Colorado: Mile High Green 

Cross (“Mile High”) in Denver and Native Roots in Boulder. FAC ¶¶ 47-49, 59-61. During his 

single visit to each dispensary, he used “a tablet or computer employing a version of Cell Checkin, 

Cell Collect, or another similar Baker application.” Id. ¶¶ 48, 60. He entered his cell number, which 

has an Illinois area code, into the application. Id. ¶¶ 111. After his visit to Mile High, he began 

receiving telemarketing texts from the dispensary, such as: “Mile High Green Cross 852 Broadway 

– MHGC. Sale! Recreational $150 Oz. Out the door. Select Strains. While supplies last.” Id. ¶¶ 

41, 44. He alleges that Mile High sent him at least 13 marketing text messages between June 18 

and September 13, 2016, at least 11 of which he received while he was in the Northern District of 

California. Id. ¶¶ 41, 45; id., Ex. 1. He received a single text message from Native Roots on October 

13, 2016, which read: “Welcome to online ordering at Native Roots Boulder! Visit our online menu 

for availability, pricing, and photos here: http://tbkr.com/nrb - powered by Baker.” Id. ¶¶ 55-57; id. 

Ex. 3. The messages sent by Mile High and Native Roots came from at least four different numbers, 

all of which have Colorado area codes. See id. ¶¶ 42, 55. Komaiko avers that he never provided 

prior express written consent to receive telemarketing texts from either dispensary. Id. ¶¶ 51, 63.

2. Washington Dispensary

On December 8 or 9, 2016, Cooperman visited the Herban Legends dispensary in Seattle, 

Washington, which is another Baker client. FAC ¶¶ 40, 74. During that visit, she used a store tablet 

running Cell Checkin or a similar Baker application. Id. ¶ 75. The tablet displayed a page with 

Herban Legends’ logo at the top and Baker’s logo at the bottom. Id. ¶ 76. After Cooperman tapped 

on that page, another page opened with text that read: “Enter your cell number.” Id. That page also 

displayed both logos, and the following language appeared above the Baker logo: 

Message and data rates may apply. Click here for [Terms and Conditions 

(]ToCs[)]. Consent is not a condition of purchase. An autodialed marketing 

message will be sent to the number provided. No purchase necessary. 

Information collected in connection with this program will be used in 

accordance with the Baker Privacy Policy.

Id. (alterations in original). The page provided hyperlinks to the TOCs and privacy policy, and 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 5 of 30
6

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

United States District Court

Northern District of California

according to Plaintiffs, those documents related to Baker, not Herban Legends. Id. Further, tapping 

on the Baker logo on any of the pages opened a separate page that stated: “Baker. Baker is the 

leading software partner for dispensaries across the country. Visit trybaker.com or email us at 

info@trybaker.com for more information!” Id.; see also id., Ex. 5. 

Cooperman entered her cell number, which has a Kansas area code, into the application. 

FAC ¶¶ 76, 112. She avers that this is the only time when and method by which she disclosed her 

cell number to Herban Legends. Id. ¶¶ 78-79. Between December 9, 2016 and October 25, 2018, 

Cooperman received at least 121 telemarketing texts from Herban Legends. Id. ¶ 67; see id., Ex. 3. 

The texts included messages like “IndigoPros are back in stock!! Get your favorite new Vape while 

supplies last! @herbanlegends 55 Bell st https://tbker.co/dm1v3.” Id.; see id., Ex. 3. Plaintiffs 

assert that the “vast majority” of the messages Cooperman received from Herban Legends contained 

hyperlinks to “tbkr.co,” which in turn redirects to Baker’s website, trybaker.com. Id. ¶ 71. 

Cooperman alleges that she received at least one telemarketing text from Herban Legends while she 

was within the Northern District of California. Id. ¶ 73. These messages appeared to be sent from 

three different numbers, two of which were sent from a Washington area code while the third was a

toll-free 844 number. Id. ¶ 68. 

3. California Dispensary

Komaiko visited Purple Star in San Francisco, California on February 24, 2015. FAC ¶ 98. 

Plaintiffs aver that he completed a paper patient information form and entered his cell number on 

this form, but that the form did not include his prior express written consent to receive telemarketing 

texts from Purple Star. Id. ¶ 99. Komaiko asserts that the form he submitted during that visit was 

the only time he gave his number to Purple Star, and that he never provided valid prior express 

written consent to receive telemarketing texts from the dispensary. Id. ¶¶ 100, 102. According to 

Plaintiffs, sometime after Komaiko visited Purple Star but before he had received any telemarketing 

texts from that dispensary, Purple Star became Baker’s client. Id. ¶ 103. 

After Baker engaged Purple Star as a client, Komaiko allegedly received at least 108 

telemarketing texts from Purple Star between November 2, 2017 and April 17, 2018. Id. ¶ 89; see 

id., Ex. 6. The texts contained messages such as “WELCOME TO PURPLE STAR MD. 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 6 of 30
7

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

United States District Court

Northern District of California

AMAZING COUPONS, DISCOUNTS, AND DEALS ARE COMING SOON. Message & Data 

Rates may apply. Periodic Messaging. Text STOP to end, text HELP for info. Terms of Use & 

Privacy Policy http://tbkr.co/tc.” Id., Ex. 6. The messages from Purple Star came from three 

different numbers: one was from area code 415, associated with San Francisco; one was an 844 

number; and one was from area code 720, which is associated with Denver, Colorado. Id. ¶ 90. The 

last number was identical to the number Native Roots used to contact him. Id. 

Komaiko alleges that he contacted Purple Star regarding the telemarketing texts he received 

from the dispensary, and Purple Star explained that he had provided the dispensary with prior 

express written consent to receive telemarketing texts from it when he used a Baker application at 

Native Roots. FAC ¶¶ 100, 109. According to Plaintiffs, Baker gave Purple Star the information 

Komaiko had given to Native Roots and provided advice to Purple Star about the legality of sending 

telemarketing texts to Komaiko. Id. ¶ 110.

D. Claims

Plaintiffs allege that they received the telemarketing texts without providing their prior 

express written consent in violation of the federal TCPA and California’s UCL. Defendants now 

move to dismiss the claims under Rule 12(b)(2) on the basis that the court lacks personal jurisdiction 

over either Defendant and under Rule 12(b)(6) for failure to state a claim.

II. LEGAL STANDARDS

A. Rule 12(b)(2) Motions

“Where . . . there is no applicable federal statute governing personal jurisdiction, the district 

court applies the law of the state in which the district court sits.” Yahoo! Inc. v. La Ligue Contre Le 

Racisme Et L’Antisemitisme, 433 F.3d 1199, 1205 (9th Cir. 2006). Because California’s long-arm 

statute allows a court to exercise personal jurisdiction to the extent permitted by the Due Process 

Clause of the United States Constitution, “the jurisdictional analyses under state law and federal due 

process are the same.” Id.; see also Cal. Civ. Proc. Code § 410.10 (“A court of this state may 

exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United 

States.”). 

In a motion to dismiss for lack of personal jurisdiction, the non-moving party “bears the 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 7 of 30
8

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

United States District Court

Northern District of California

burden of establishing that jurisdiction is proper.” Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th 

Cir. 2008). Where, as here, a district court rules on a motion to dismiss without holding an 

evidentiary hearing, the non-moving party “need only demonstrate facts that if true would support 

jurisdiction over the defendant.” Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995). 

“[U]ncontroverted allegations in the complaint must be taken as true . . . [and] [c]onflicts between 

parties over statements contained in affidavits must be resolved in the plaintiff’s favor.” 

Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004).

B. Rule 12(b)(6) Motions

A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the claims alleged in 

the complaint. See Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). When 

reviewing a motion to dismiss for failure to state a claim, the court must “accept as true all of the 

factual allegations contained in the complaint,” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per 

curiam) (citation omitted), and may dismiss a claim “only where there is no cognizable legal theory” 

or there is an absence of “sufficient factual matter to state a facially plausible claim to relief.” 

Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010) (citing Ashcroft 

v. Iqbal, 556 U.S. 662, 677-78 (2009); Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)) 

(quotation marks omitted). A claim has facial plausibility when a plaintiff “pleads factual content 

that allows the court to draw the reasonable inference that the defendant is liable for the misconduct 

alleged.” Iqbal, 556 U.S. at 678 (citation omitted). In other words, the facts alleged must 

demonstrate “more than labels and conclusions, and a formulaic recitation of the elements of a cause 

of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 554, 555 (2007) (citing Papasan v. 

Allain, 478 U.S. 265, 286 (1986)); see Lee v. City of L.A., 250 F.3d 668, 679 (9th Cir. 2001), 

overruled on other grounds by Galbraith v. Cty. of Santa Clara, 307 F.3d 1119 (9th Cir. 2002).

As a general rule, a court may not consider “any material beyond the pleadings” when ruling 

on a Rule 12(b)(6) motion. Lee, 250 F.3d at 688 (citation and quotation marks omitted). However, 

“a court may take judicial notice of ‘matters of public record,’” id. at 689 (citing Mack v. S. Bay 

Beer Distrib., 798 F.2d 1279, 1282 (9th Cir. 1986)), and may also consider “documents whose 

contents are alleged in a complaint and whose authenticity no party questions, but which are not 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 8 of 30
9

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

United States District Court

Northern District of California

physically attached to the pleading,” without converting a motion to dismiss under Rule 12(b)(6) 

into a motion for summary judgment. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994), overruled 

on other grounds by Galbraith, 307 F.3d at 1125-26. The court need not accept as true allegations 

that contradict facts which may be judicially noticed. See Mullis v. U.S. Bankr. Court, 828 F.2d 

1385, 1388 (9th Cir. 1987).

III. DISCUSSION

A. Rule 12(b)(2) Motion

Personal jurisdiction may be either general or specific. Bristol-Myers Squibb Co. v. Sup. Ct. 

Cal., San Francisco Cty., 137 S. Ct. 1773, 1780 (2017). “For an individual, the paradigm forum for 

the exercise of general jurisdiction is the individual’s domicile; for a corporation, it is an equivalent 

place, one in which the corporation is fairly regarded as at home.” Goodyear Dunlop Tires 

Operations, S.A. v. Brown, 564 U.S. 915, 924 (U.S. 2011). Plaintiffs do not assert nor do the 

pleadings support the existence of general jurisdiction over either Defendant. Accordingly, the only 

issue is whether the court may exercise specific jurisdiction over Baker and TILT. Where a party 

is not subject to general jurisdiction, due process requires that a defendant have “certain minimum 

contacts with it such that the maintenance of the suit does not offend traditional notions of fair play 

and substantial justice.” Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (internal quotations 

omitted). The Ninth Circuit uses a three-part test to analyze whether a party’s “minimum contacts” 

comport with the doctrine articulated in International Shoe:

(1) The non-resident defendant must purposefully direct his activities or 

consummate some transaction with the forum or resident thereof; or 

perform some act by which he purposefully avails himself of the privilege 

of conducting activities in the forum, thereby invoking the benefits and 

protections of its laws;

(2) the claim must be one which arises out of or relates to the defendant’s 

forum-related activities; and

(3) the exercise of jurisdiction must comport with fair play and substantial 

justice, i.e. it must be reasonable.

Schwarzenegger, 374 F.3d at 802. “The plaintiff bears the burden of satisfying the first two prongs 

of the test.” Id. (citing Sher v. Johnson, 911 F.2d 1357, 1361 (9th Cir. 1990)). If the plaintiff meets 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 9 of 30
10

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

United States District Court

Northern District of California

its burden on the first two prongs, “the burden then shifts to the defendant to ‘present a compelling 

case’ that the exercise of jurisdiction would not be reasonable.” Id. (quoting Burger King Corp. v. 

Rudzewicz, 471 U.S. 462, 476-78 (1985)). If any of the three factors are not met, “jurisdiction in 

the forum would deprive the defendant of due process of law.” Omeluk v. Langsten Slip & 

Batbyggeri A/S, 52 F.3d 267, 270 (9th Cir. 1995).

As Defendants point out and Plaintiffs acknowledge, all of Plaintiffs’ allegations relate to 

Baker, not TILT. Plaintiffs’ arguments with respect to personal jurisdiction over TILT rely entirely

on the corporate relationship between Baker and TILT. Accordingly, the court first analyzes 

personal jurisdiction over Baker and then turns to the question of whether it can exercise personal 

jurisdiction over TILT.

1. Purposeful Direction and the Calder Test

Under the first prong of the specific jurisdiction test, purposeful availment and purposeful 

direction are distinct concepts. Schwarzenegger, 374 F.3d at 802. Purposeful availment is most 

often used in cases related to contract disputes, and purposeful direction is used in cases, such as 

this consumer protection class action, that sound in tort. Id. Purposeful direction is analyzed under 

the three-part test derived from Calder v. Jones, 465 U.S. 783 (1984): “that the defendant allegedly 

ha[s] (1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing harm that 

the defendant knows is likely to be suffered in the forum state.” Dole Food Co. v. Watts, 303 F.3d 

1104, 1111 (9th Cir. 2002). The Calder test is appropriate here because TCPA actions are 

“essentially . . . tort claim[s].” Schlesinger v. Collins, No. 19-cv-03483-EMC, 2019 WL 4674396, 

at *2 (N.D. Cal. Sept. 25, 2019); see also Moser v. Health Ins. Innovations, Inc., 2018 WL 325112, 

at *3 (S.D. Cal. Jan. 5, 2018) (“[C]ases brought under the TCPA sound in tort . . . .”).

a. Intentional Act

In the Ninth Circuit, an “intentional act” is an “an external manifestation of the actor’s intent 

to perform an actual, physical act in the real world, not including any of its actual or intended 

results.” Washington Shoe Co. v. A-Z Sporting Goods Inc., 704 F.3d 668, 674 (9th Cir. 2012)

(“Washington Shoe”), abrogation on other grounds recognized by Axiom Foods, Inc. v. Acerchem 

Int’l, Inc., 874 F.3d 1064 (9th Cir. 2017). With respect to this prong of the Calder test, Plaintiffs 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 10 of 30
11

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

United States District Court

Northern District of California

allege that Baker performed several acts that were expressly aimed at California, including: (1) 

sending text messages on behalf of Purple Star from a number with a San Francisco area code; (2) 

“engaging client dispensaries in California and serving them by sending text messages on their 

behalves”; (3) sending agents to California to host a booth at a trade show; (4) training specialists 

to serve its California clients, such as Purple Star; (5) having a CEO who split his time between San 

Francisco and Denver during the time period of the events underlying the complaint; and (6) 

maintaining websites on behalf of California clients that sell exclusively to California residents. 

These facts go to both the first and second part of the Calder test, but will be addressed separately. 

Baker responds that their clients, and not Baker, sent the text messages and that the court cannot 

assert personal jurisdiction over Baker due to the intentional acts of its clients. Baker’s responses 

to the remaining facts cited by Plaintiffs go to the second and third prong of the test and will likewise 

be addressed in those sections.

The parties heavily dispute whether Baker or its clients “sent” the text messages. The court 

need not resolve this dispute for the purposes of personal jurisdiction, however, since Plaintiffs 

adequately allege (and Baker does not rebut) numerous intentional acts by Baker. Whether those

acts were directed at California or sufficiently related to Plaintiffs’ claims are addressed below.

b. Express Aiming and Resulting Harm

The second and third prong of the Calder test requires that the non-forum defendant 

“expressly aimed” the intentional act(s) at the forum state, causing harm that the defendant “knows 

is likely to be suffered in the forum state.” Dole Food Co., 303 F.3d at 1111. With respect to at 

least the claims arising from Plaintiffs’ encounters with the dispensaries in Washington and 

Colorado, Baker argues that Plaintiffs only allege conduct against them as individuals and not acts 

targeted at California itself.

The Supreme Court has established that the “express aiming” prong requires a showing that 

“the defendant’s conduct connects him to the forum in a meaningful way,” not merely to a forum 

resident. Walden v. Fiore, 571 U.S. 277, 290 (2014), the 571 U.S. at 278 (emphasis added); see 

also Morrill v. Scott Fin. Corp., 873 F.3d 1136, 1148 (9th Cir. 2017) (“Plaintiffs were required to 

make a prima facie showing that Defendants’ alleged actions were directed at [the forum state], not 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 11 of 30
12

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

United States District Court

Northern District of California

just at individuals who reside there.”). In TCPA actions, courts have consistently held that the 

second and third prongs of the Calder test are satisfied when defendants contact numbers with area 

codes associated with that state. See Schlesinger, 2019 WL 4674396, at *2 (citing cases); Moser v. 

Health Ins. Innovations, Inc., 2018 WL 325112, at *4 (S.D. Cal. Jan. 5, 2018) (“The effects test is 

satisfied by a plaintiff’s uncontroverted allegation that a defendant violated the TCPA by calling a 

phone number with a forum state area code.”). Schlesinger observed that these cases are consistent 

with Walden because “target[ing] California telephone numbers (and presumably residents of 

California) . . . inflict[s] harm within this state.” 2019 WL 4674396, at *2. By contrast, courts have 

declined to find personal jurisdiction over TCPA defendants when they had no reason to know that 

their conduct would be felt in California. In Abedi v. New Age Med. Clinic PA, 2018 WL 3155618 

(E.D. Cal. June 25, 2018), for example, the plaintiff received services from a New Jersey corporation 

in New Jersey; the defendant did not do any business outside of New Jersey; the plaintiff gave the 

defendant a non-California phone number; and the plaintiff did not inform the corporation that she 

had moved from New Jersey to California. 2018 WL 3155618, at *5. The court there held that it 

was not enough for the plaintiff to show that she received text messages from the defendant while 

she was located in Merced, California: “Of critical importance, the cell phone number provided to 

[the defendant] by [the plaintiff] was for a non–California number . . . . There is nothing before the 

Court that suggests in any way that [the defendant] either knew or should have known that its text 

messages were sent into California and received by a resident of Merced.” Id.

The reasoning in Abedi applies to the texts Plaintiffs received from the non-California 

dispensaries. Komaiko visited two Colorado dispensaries and provided his Illinois number, while 

Cooperman visited a dispensary in Washington and provided her Kansas number. None of these 

allegations suggest that Baker had any reason to know that the text messages from those dispensaries 

were sent into California. Even assuming that Baker knew its non-California dispensaries would 

likely send at least some messages to California residents, and that not every California resident has 

a California number, mere knowledge of the statistical probability that its activities will have some 

impact in California is too attenuated to support the exercise of personal jurisdiction in this state. 

See Morrill, 873 F.3d at 1145 (“[T]o establish the basis for specific personal jurisdiction, a tort must 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 12 of 30
13

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

United States District Court

Northern District of California

involve the forum state itself, and not just have some effect on a party who resides there.”); see also 

Walden, 571 U.S. at 290 (“The proper question is not where the plaintiff experienced a particular 

injury or effect but whether the defendant’s conduct connects him to the forum in a meaningful 

way.”). Accordingly, Plaintiffs have not met their burden to show that Baker’s alleged conduct in 

sending/facilitating unsolicited text messages from non-Californian dispensaries to non-Californian 

numbers was expressly aimed at this state. 

By contrast, Baker’s activities in relation to Purple Star establish a stronger connection to 

California. Plaintiffs allege, and Baker does not dispute, that Baker solicits business from client 

dispensaries in California; trains specialists to specifically assist California clients; and provides 

services specific to California, such as maintaining interactive websites that sell products 

exclusively to California clients. Further, the majority of numbers collected by California 

dispensaries through Baker’s applications likely belong to California residents. Therefore, texts 

sent to those numbers in violation of the TCPA will largely cause harm in California. 

In sum, Plaintiffs have not met their burden to show that Baker expressly aimed conduct at 

California through the text messages sent to non-California numbers from non-California 

dispensaries. However, they have made a prima facie case that Baker purposefully directed conduct 

at California through its solicitation of business from Californian dispensaries like Purple Star. 

Whether Komaiko’s claims are sufficiently related to Baker’s contacts with Purple Star is the subject 

of the next section.

2. Forum-Related Activities

In order to establish that the forum state has personal jurisdiction over a defendant, the 

plaintiff’s claim “must be one which arises out of or relates to the defendant’s forum-related 

activities.” Schwarzenegger, 374 F.3d at 802 (citation omitted). Baker lists some of its alleged 

contacts with California and summarily asserts that “[t]hese allegations have no relationship to 

Plaintiffs’ TCPA and UCL claims, and they cannot form the basis for specific jurisdiction over 

Baker.” Mot. at 15.

Baker’s argument is unconvincing. First, Baker construes the complaint to allege only three 

contacts with California: that (1) Milton “split[] his time between Denver, Colorado and San 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 13 of 30
14

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

United States District Court

Northern District of California

Francisco, California” during the relevant time period; (2) Baker hosted a booth at a California trade 

show for cannabis businesses; and (3) Baker received funding from California-based venture capital 

firms to expand its operations in California. However, as explained above, the complaint details 

other contacts between Baker and California: namely, that it solicits business from Californian 

cannabis dispensaries; trains specialists to specifically assist California clients; and provides 

services specific to California, such as maintaining interactive websites that sell products 

exclusively to California customers. Second, the Ninth Circuit has held that “[t]he second prong of 

the specific jurisdiction test is met if ‘but for’ the contacts between the defendant and the forum 

state, the cause of action would not have arisen.” Terracom v. Valley Nat. Bank, 49 F.3d 555, 561 

(9th Cir. 1995). Komaiko alleges that Purple Star collected his cell number during his in-person 

visit to the Californian dispensary. Baker points out that Purple Star was not one of its clients when 

the dispensary collected Komaiko’s cell number, but Komaiko alleges that he began receiving texts 

from Purple Star only after it became a Baker client. For the purposes of establishing personal 

jurisdiction, a defendant’s contacts with the forum state are measured “prior to the event causing the 

litigation.” Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 913 (9th Cir. 

1990). The alleged misconduct in this case was not taking Komaiko’s information in the first place; 

it was using that information to send him unsolicited telemarketing messages. Since Baker’s 

contacts with Purple Star were established prior to the alleged unlawful texts, and the complaint 

alleges that Komaiko received texts from Purple Star because it became a Baker client, Komaiko 

has sufficiently pleaded that Baker’s forum-related conduct were the “but for” cause of his alleged 

harm.

Therefore, Baker’s contacts with Purple Star may serve as the basis for exercising personal 

jurisdiction over Baker in California.

3

 

3 At the hearing, Baker argued that Cooperman alleges no relevant contacts with California and so 

there is not personal jurisdiction over Baker with respect to her claims. The court disagrees. The 

Ninth Circuit recognizes pendent personal jurisdiction, such that “a court may assert pendent 

personal jurisdiction over a defendant with respect to a claim for which there is no independent basis 

of personal jurisdiction so long as it arises out of a common nucleus of operative facts with a claim 

in the same suit over which the court does have personal jurisdiction.” Action Embroidery Corp. v. 

Atl. Embroidery, Inc., 368 F.3d 1174, 1180 (9th Cir. 2004). The exercise of pendent personal 

jurisdiction is particularly appropriate in putative nationwide class actions, like the present case. 

See Sloan v. Gen. Motors LLC, 287 F. Supp. 3d 840, 861 (N.D. Cal. 2018). Therefore, even if 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 14 of 30
15

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

United States District Court

Northern District of California

3. Fair Play and Substantial Justice

The third and final prong of the specific jurisdiction analysis looks at “whether the exercise 

of jurisdiction . . . comport[s] with fair play and substantial justice, i.e. it must be reasonable.” 

Schwarzenegger, 374 F.3d at 802; see also Burger King, 471 U.S. at 467-77 (“Once it has been 

decided that a defendant purposefully established minimum contacts within the forum State, these 

contacts may be considered in light of other factors to determine whether the assertion of personal 

jurisdiction would comport with ‘fair play and substantial justice’”). The Ninth Circuit considers 

the following factors relevant to the reasonableness inquiry: 

(1) the extent of the defendants’ purposeful interjection into the forum 

state’s affairs; (2) the burden on the defendant of defending in the forum; 

(3) the extent of conflict with the sovereignty of the defendants’ state; (4) 

the forum state’s interest in adjudicating the dispute; (5) the most efficient 

judicial resolution of the controversy; (6) the importance of the forum to the 

plaintiff’s interest in convenient and effective relief; and (7) the existence 

of an alternative forum.

Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1487–88 (9th Cir. 1993). “None of the factors 

is dispositive in itself; instead, we must balance all seven.” Id. at 1488. On this prong, it is the 

defendant’s burden to “present a compelling case that the exercise of jurisdiction would not be 

reasonable.” Schwarzenegger, 374 F.3d at 802 (internal quotation marks and citation omitted). 

There is a presumption of reasonableness where the defendant takes actions to “solicit and obtain 

business in California.” Sinatra v. Nat’l Enquirer, Inc., 854 F.2d 1191, 1201 (9th Cir. 1988).

a. Purposeful Interjection

Baker has contacts with California through its California dispensary clients. In its Listing 

Statement with the Canadian Securities Exchange, TILT claimed that Baker is the “industry-leading 

CRM platform” and that it held approximately 32% of the U.S. market share with respect to cannabis 

dispensaries as of June 30, 2018. Listing Statement at 52. TILT also stated that Baker “generates 

most of its revenue from sales in Colorado, California, and Washington.” Id. Approximately 23% 

Cooperman’s claims would not provide an independent basis for personal jurisdiction, the court has 

jurisdiction over those claims because they arise from a common nucleus of operative facts with 

claims over which the court has personal jurisdiction.

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 15 of 30
16

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

United States District Court

Northern District of California

of Baker’s 2017 revenue was generated from sales in California. Id. at 456.4 The extent of Baker’s 

involvement with California is significant. See Harris Rutsky & Co. Ins. Servs. v. Bell & Clements 

Ltd., 328 F.3d 1122, 1132 (9th Cir. 2003) (finding that the defendant’s contacts with California were 

“fairly extensive” because it conducted 20% of its business in California).

Therefore, this factor weighs strongly in favor of Plaintiffs.

b. Burden on Defendant

The second factor considers the burden on the defendant in defending itself in the forum 

state. This factor is not given significant weight, since “modern advances in communications and 

transportation have significantly reduced the burden of litigating” in a non-home forum. Sinatra, 

854 F.2d at 1199. This is particularly true when the defendant is a citizen of another state rather 

than from a foreign country. SMS Signature Cars, Inc. v. Arrington Engines, Inc., 2011 WL 

13225291, at *13 (C.D. Cal. May 20, 2011) (“[G]iven that . . . modern advances have reduced the 

burden of litigating abroad, they certainly have alleviated the burden of litigating in another state.”). 

This factor is also less compelling when the defendant is a corporation rather than an individual. Id. 

(“[T]he difference in the burden placed on an individual versus a large corporation to travel out of 

state is significant.”); see Core-Vent, 11 F.3d at 1489 (noting that the burden of litigating in a foreign 

forum is typically less substantial for corporate parties than for individuals). In this case, Baker is 

a Delaware corporation and will not face significant difficulties in litigating in California.

In sum, this factor weighs only slightly in favor of Baker.

c. Sovereignty

The third factor looks at the “extent of conflict with the sovereignty of the defendant’s state.” 

Core-Vent, 11 F.3d at 1489. This factor is not particularly salient in a dispute between U.S. citizens. 

Sinatra, 854 F.2d at 1199 (“[L]itigation against an alien defendant creates a higher jurisdictional 

barrier than litigation against a citizen from a sister state . . . .”); Gray & Co. v. Firstenberg Mach. 

Co., 913 F.2d 758, 761 (9th Cir. 1990) (finding that, where the alternative forum is also within the 

United States, “any conflicting sovereignty interests are best accom[m]odated through choice-of4 This is the page number as generated by ECF, since the indices to the Listing Statement are not 

easily referenced.

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 16 of 30
17

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

United States District Court

Northern District of California

law rules rather than jurisdictional rules”). Further, a conflict of sovereignty between states does 

not arise where the claims are largely federal. Avaya Inc. v. Pearce, No. 19-cv-00565-SI, 2019 WL 

6311383, at *10 (N.D. Cal. Nov. 25, 2019). Baker concedes that the exercise of personal jurisdiction 

in California would not create a conflict with the sovereignty of its home state. Opp. at 16.

This factor is neutral.

d. Forum State’s Interest

“California maintains a strong interest in providing an effective means of redress for its 

residents . . . .” Sinatra, 854 F.2d at 1200. Here, Plaintiffs are California citizens who allege injury 

as a result of Baker’s unlawful conduct. j2 Glob. Commc’ns, Inc. v. Blue Jay, Inc., No. 08-cv-4254-

PJH, 2009 WL 29905, at *10 (N.D. Cal. Jan. 5, 2009) (finding that California has a strong interest 

in protecting its residents from violations of the TCPA). 

This factor weighs in favor of Plaintiffs.

e. Efficient Resolution

In considering which forum could resolve this dispute most efficiently, the court focuses on 

the location of the evidence and witnesses. Harris Rutsky, 328 F.3d at 1133. Baker points out that 

Plaintiffs are seeking to represent a nationwide class, and that the Supreme Court has not settled the 

question of whether a federal court exercising specific jurisdiction over a defendant may adjudicate 

the claims of non-resident class members. Mot. at 17 (citing Bristol-Myers, 137 S. Ct. at 1776). It 

claims that the case will be delayed by litigating that question in this court, whereas there would be 

no such dispute in Colorado since that state has general jurisdiction over Baker. Id. 

Baker essentially asserts that it will make resolution of this case less efficient in California 

through its own litigation strategy. It says nothing about the location of witnesses or evidence, 

which is what the court must consider for this factor. At least some witnesses are present in 

California, including the named Plaintiffs and Purple Star, and the evidence held by those witnesses 

is also located here. While there are likely witnesses and evidence outside of California, Baker has 

raised no argument that it would be less efficient to conduct out-of-state discovery here than in 

Colorado. In addition, this factor has also become less important in light of “modern advances in 

communication and transportation.” Avaya, 2019 WL 6311383, at *10 (quoting Harris Rutsky, 328 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 17 of 30
18

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

United States District Court

Northern District of California

F.3d at 1133).

This factor is neutral.

f. Plaintiffs’ Interests

Plaintiffs unquestionably have an interest in bringing this case in their home state; however, 

“the plaintiff’s convenience is not of paramount importance.” Dole Food, 303 F.3d at 1116; see 

Core-Vent, 11 F.3d at 1490.

Therefore, this factor weighs only slightly in favor of Plaintiffs.

g. Alternative Forum

“Plaintiffs bear the burden of proving the unavailability of an alternative forum.” 

Freestream Aircraft (Bermuda) Ltd. v. Aero Law Grp., 905 F.3d 597, 609 (9th Cir. 2018). Plaintiffs 

do not contest that Colorado is an alternative forum.

This factor weighs in favor of Baker.

h. Balance of Factors

Two of the reasonableness factors weigh in favor of Baker, three favor Plaintiffs, and two 

are neutral. The Ninth Circuit has held that, where the balance of factors is close, the defendants 

have not met their burden on the third prong. Roth v. Garcia Marquez, 942 F.2d 617, 625 (1991) 

(“[Defendants] may be able to show that the exercise of jurisdiction might be unreasonable, but the 

closeness of the question manifests that they cannot do so in a compelling fashion.”) (finding the 

exercise of personal jurisdiction was reasonable where only two of the seven factors favored the 

plaintiff); Harris Rutsky, 328F.3d at 1134 (finding the reasonableness prong met where four of the 

seven factors favored the defendant). Since Plaintiffs met their burden as to the first two prongs of 

the specific jurisdiction test, there is a presumption of reasonableness and the burden is on Baker to 

rebut the presumption with a compelling case. See Roth, 942 F.2d at 625. It has not done so here.

Accordingly, Defendants’ Rule 12(b)(2) motion is denied as to Baker.

4. Personal Jurisdiction over TILT

Having determined that it may exercise personal jurisdiction over Baker, the court now 

addresses whether TILT is also subject to personal jurisdiction in this state. Calder, 465 U.S. at 790 

(“Each defendant’s contacts with the forum State must be assessed individually.”). Plaintiffs have 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 18 of 30
19

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

United States District Court

Northern District of California

not pleaded any independent acts by TILT; instead, they assert that TILT is subject to personal 

jurisdiction in California because the companies merged in 2018 and TILT became a successor to 

Baker. Opp. at 10. In support of this claim, they point to the allegations in the complaint and a 

press release by TILT that describes the BCA as a “merger.” See FAC ¶¶ 114-21; id., Ex. 9. 

Defendants assert that they did not merge in 2018; instead, Baker merged with TILT US and later 

became an indirect subsidiary of TILT through Jimmy Jang. Milton Decl. ¶ 9. 

“[A]s a general rule, where a parent and a subsidiary are separate and distinct corporate 

entities, the presence of one . . . in a forum state may not be attributed to the other.”5 Holland Am. 

Line Inc. v. Wartsila N. Am., Inc., 485 F.3d 450, 459 (9th Cir. 2007). By contrast, “[a] court has 

personal jurisdiction over an alleged successor company . . . if: (i) the court would have had personal 

jurisdiction over the predecessor and (ii) the successor company effectively assumed the subject 

liabilities of the predecessor.” Lefkowtiz v. Scytl USA, No. 15-CV-05005-JSC, 2016 WL 537952, 

at *3 (N.D. Cal. Feb. 11, 2016) (internal quotation marks and citations omitted). Notably, most of 

Plaintiffs’ arguments regarding successor liability are addressed in response to Defendants’ Rule 

12(b)(6) motion. Unlike a motion to dismiss for failure to state a claim, where the court accepts as 

true all adequately pleaded allegations in the complaint, a court ruling on a motion under Rule 

12(b)(2) “may not assume the truth of allegations in a pleading which are contradicted by affidavit.” 

Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011) (citation omitted). 

As detailed above, the declaration of Joel Milton, the BCA, and the Listing Statement (which was 

submitted by Plaintiffs) all describe the series of transactions whereby Baker merged with TILT US 

and became a subsidiary of TILT. Plaintiffs do not dispute the accuracy of these documents or 

explain how Baker’s merger with TILT’s subsidiary constitutes a merger with TILT. 

Even if Plaintiffs sufficiently established that TILT is Baker’s successor, which they did not, 

a successor generally does not assume liability for its predecessor’s liabilities unless one of the 

following four exceptions applies:

(1) the successor expressly or impliedly agrees to assume the subject 

5 An exception to the general rule is the alter ego theory of liability, which Plaintiffs do not assert 

here. See Ranza v. Nike, Inc., 793 F.3d 1059, 1070 (9th Cir. 2015).

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 19 of 30
20

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

United States District Court

Northern District of California

liabilities; (2) the transaction amounts to a consolidation or merger of the 

successor and the predecessor (de facto merger); (3) the successor is a mere 

continuation of the predecessor; or (4) the transfer of assets to the successor 

is for the fraudulent purpose of escaping liability for the predecessor’s 

debts.

Lefkowitz, 2016 WL 537952, at *4. Plaintiffs have not offered any argument that the fourth 

exception applies here; accordingly, the court only addresses the first three exceptions. 

a. Assumption of Liabilities

The FAC summarily asserts that “[a]s a result of the Merger [between TILT and Baker], Tilt 

assumed the liabilities of Baker.” FAC ¶ 122. Neither the FAC nor Plaintiffs’ opposition cites any 

specific facts in support of this assertion. In No Cost Conference, Inc. v. Windstream Commc’ns, 

Inc., 940 F. Supp. 2d 1285 (S.D. Cal. 2013), the court found that the plaintiff did not adequately 

plead the applicability of the first exception where it made a conclusory allegation that the 

defendants “assumed all right and responsibilities . . . as the successor in interest [to the 

predecessor].” 940 F. Supp. 2d at 1299. In so holding, the court stated that a plaintiff must “plead 

the existence of a contract [and] its terms which establish the obligation [in] issue.” Id. (internal 

quotation marks omitted) (alterations in original); see also Winner Chevrolet, Inc. v. Universal 

Underwriters Ins. Co., 2008 WL 2693741, at *4 (E.D. Cal. July 1, 2008) (“[P]laintiffs here must 

not only plead the existence of an assumption of liability but either the terms of that assumption of 

liability (if express) or the factual circumstances giving rise to an assumption of liability (if 

implied).”).

Here, Plaintiffs do not cite to anything in the BCA, Listing Statement, or any other document 

that references TILT’s assumption of Baker’s liabilities. Nor do they plead factual circumstances 

that give rise to an assumption of liability. Plaintiffs’ barebones assertions would be insufficient to 

pass muster under a Rule 12(b)(6) motion and are even less adequate to meet their burden under a 

Rule 12(b)(2) analysis.

b. De Facto Merger

“The de facto merger doctrine applies under California law when ‘one corporation takes all 

of another’s assets without providing any consideration that could be made available to meet claims 

of the other’s creditors’ or when ‘the consideration consists wholly of shares of the purchaser’s stock 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 20 of 30
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

United States District Court

Northern District of California

which are promptly distributed to the seller’s shareholders in conjunction with the seller’s 

liquidation.’” Schwartz v. Pillsbury Inc., 969 F.2d 840, 846 (9th Cir. 1992) (quoting Ray v. Alad

Corp., 19 Cal. 3d 22, 28 (1977)). Again, Plaintiffs have not pleaded (much less offered evidence) 

that TILT absorbed all of Baker’s assets or that Baker liquidated. See Lefkowtiz, 2016 WL 537952, 

at *4 (“[T]here are no facts from which the Court can reasonably infer that [the defendant] was 

liquidated . . . .”). Further, “a de facto merger requires a showing that the purchaser paid inadequate 

consideration for the seller’s assets.” Sunnyside Dev. Co., LLC v. Opsys Ltd., No. 05-cv-0553-MHP, 

2007 WL 2462142, at *9 (N.D. Cal. Aug. 29, 2007). Plaintiffs have not pleaded any facts tending 

to show that TILT purchased any assets from Baker, much less that TILT did not provide adequate 

consideration for them.

Accordingly, Plaintiffs have not plausibly alleged that this exception applies.

c. Mere Continuation Theory

The mere continuation theory is premised on the basis that “corporations cannot escape 

liability by a mere change of name or a shift of assets when and where it is shown that the new 

corporation is, in reality, but a continuation of the old.” Pool v. F. Hoffman-La Roche, Ltd., 386 F. 

Supp. 3d 1202, 1213 (N.D. Cal. 2019) (quoting Cleveland v. Johnson, 209 Cal. App. 4th 1315, 1327

(2012)). California courts “generally hold that successor liability based on continuation is not 

established ‘where the selling and purchasing corporations were completely separate and distinct 

entities both before and after sale.’” Sunnyside, 2007 WL 2462142, at *10. Plaintiffs do not dispute 

that Baker continues to exist separately from TILT. Instead, they argue that courts have still found 

successor liability even in those cases, but the authority upon which they rely is inapposite. In Pool 

v. F. Hoffman-La Roche, Ltd., 386 F. Supp. 3d 1202 (N.D. Cal. 2019), the predecessor company had 

a contract to sell certain pharmaceuticals to the U.S. military. Id. at 1214. It transferred that entire 

line of business to its alleged successor, although it otherwise continued as its own entity. Id. at 

1214-15. The court determined that successor liability could apply with respect to a specific line of 

business. See id. at 1215. Here, Plaintiffs have offered no facts to support that TILT is a successor 

with respect to a line of business originally operated by Baker. The other case Plaintiffs cite 

addresses situations where an alleged successor acquires the substance of its predecessor but the 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 21 of 30
22

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

United States District Court

Northern District of California

predecessor “continues to exist as a shell corporation.” Societe Anonyme Dauphitex v. Schoenfelder 

Corp., 2007 WL 3253592, at *5 (S.D.N.Y. Nov. 2, 2007). Plaintiffs’ allegations do not suggest that 

Baker is a mere corporate shell for TILT.

Further, the “basic premise underlying the [successor] theory is that a business should not 

be allowed to defraud its creditors by simply changing its form.” Hargrove & Costanzo v. United 

States, 2007 WL 2409590, at *4 (E.D. Cal. Aug. 21, 2007); see also Garcia v. New Albertson’s,

Inc., 2014 WL 4978434, at *11 (C.D. Cal. Oct. 3, 2014) (explaining that the “principle underlying 

successor liability” is preventing corporations from re-organizing to avoid their debts). Plaintiffs 

have not alleged or presented evidence that Baker is unable to satisfy its debts because of its 

corporate relationship with TILT. The policies underlying the successor theory of liability are not 

implicated in this case.

In sum, Plaintiffs have not made a prima facie case that jurisdiction over TILT is proper. 

Defendants’ Rule 12(b)(2) motion is granted as to TILT.

5. Jurisdictional Discovery

Plaintiffs request the opportunity to conduct discovery on the jurisdictional issue. A court 

may permit jurisdictional discovery “where pertinent facts bearing on the question of jurisdiction 

are controverted or where a more satisfactory showing of the facts is necessary.” Data Disc, Inc. v. 

Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1285 n. 1 (9th Cir. 1977). Courts in this district have held 

that “a plaintiff need not establish a prima facie case of personal jurisdiction before it can obtain 

jurisdictional discovery.” Teras Cargo Transp. (Am.), LLC v. Cal Dive Int'l (Australia) Pty Ltd., 

No. 15-cv-03566-JSC, 2015 WL 6089276, at *8 (N.D. Cal. Oct. 16, 2015) (citing cases). A court 

may grant jurisdictional discovery if the request is based on more than a “hunch that it might yield 

jurisdictionally relevant facts,” see Boschetto, 539 F.3d at 1020, or more than “bare allegations in 

the face of specific denials.” See Terracom v. Valley Nat’l Bank, 49 F.3d 555, 562 (9th Cir. 

1995) (citation omitted); see also Calix Networks, Inc. v. Wi-Lan, Inc., No. 09-cv-06038-CRB 

(DMR), 2010 WL 3515759, at *4 (N.D. Cal. Sept. 8, 2010) (“[A] plaintiff must present a colorable 

basis for jurisdiction, or some evidence constituting a lesser showing than a prima facie case.” 

(quotations omitted)). It is not an abuse of discretion to deny jurisdictional discovery “when it is 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 22 of 30
23

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

United States District Court

Northern District of California

clear that further discovery would not demonstrate facts sufficient to constitute a basis for 

jurisdiction.” Wells Fargo & Co. v. Wells Fargo Exp. Co., 556 F.2d 406, 430 n. 24 (9th Cir. 1977).

Here, Plaintiffs’ jurisdictional argument against TILT rests entirely on their claim that TILT 

and Baker “merged” in 2018. They have offered nothing in support other than a press release that 

obliquely references a “merger” in reference to the BCA. In contrast, Defendants have set forth 

specific and detailed facts regarding their corporate structure, as reflected in public documents 

whose authenticity Plaintiffs do not question. Plaintiffs did not identify anything in those documents 

that disproves Defendants’ characterization of their parent-subsidiary relationship. Under these 

facts, Plaintiffs’ arguments amount to no more than a “hunch” that jurisdictional discovery would 

uncover jurisdictionally relevant facts.

Accordingly, Plaintiffs’ request to take additional discovery is denied.

B. Rule 12(b)(6) Motion

Defendants move to dismiss the complaint for failure to state a claim under Rule 12(b)(6) 

because (1) Plaintiffs have not adequately pleaded Baker’s liability under the TCPA; (2) Plaintiffs 

have not sufficiently alleged that TILT is liable under the TCPA; and (3) Plaintiffs’ complaint does 

not adequately allege that Cooperman has standing under the UCL. Plaintiffs concede that 

Cooperman lacks standing to pursue a UCL claim and withdrew that claim as to her. Further, for 

the reasons stated above, the court dismisses the complaint against TILT for lack of personal 

jurisdiction. Therefore, the court considers only whether Plaintiffs have stated a claim against Baker 

for violations of the TCPA.

The TCPA makes it unlawful “for any person . . . to make a call (other than a call made for 

emergency purposes or made with the prior express consent of the called party) using any automatic 

telephone dialing system [“ATDS”] or an artificial or prerecorded voice . . . to any telephone number 

assigned to a . . . cellular telephone service . . . .” 47 U.S.C. § 227(b)(1)(A)(iii); see 47 C.F.R. § 

64.1200(a)(1) (“No person or entity may . . . initiate any telephone call . . . .”). The TCPA defines 

an ATDS as “equipment which 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). The Ninth Circuit has held that “a text message is a ‘call’ within the meaning of the 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 23 of 30
24

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

United States District Court

Northern District of California

TCPA.” Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 952 (9th Cir. 2009). 

In this motion, the parties primarily dispute the meaning of “making” or “initiating” a text 

message under the TCPA. Neither the TCPA nor implementing rules define “initiate”; however, 

the FCC issued guidance on this question in 2015. In the Matter of Rules & Regulations 

Implementing the Tel. Consumer Prot. Act of 1991, 30 F.C.C. Rcd. 7961 (2015) (“2015 Guidance”). 

This court is “bound by the FCC’s interpretations of the TCPA, unless those interpretations are 

invalidated by a court of appeals.” Reardon v. Uber Techs., Inc., 115 F. Supp. 3d 1090, 1097 (N.D. 

Cal. 2015).

1. FCC Guidance

In the 2015 Guidance, the FCC determined that the word “initiate” suggests a “direct 

connection between a person or entity and the making of a call,” and described some factors relevant 

to deciding whether a “direct connection” exists:

[A] “direct connection between a person or entity and the making of a call” 

can include “tak[ing] the steps necessary to physically place a telephone 

call.” It also can include being “so involved in the placing of a specific 

telephone call” as to be deemed to have initiated it. Thus, we look to the 

totality of the facts and circumstances surrounding the placing of a 

particular call to determine: 1) who took the steps necessary to physically 

place the call; and 2) whether another person or entity was so involved in 

placing the call as to be deemed to have initiated it, considering the goals 

and purposes of the TCPA. . . . Depending upon the facts of each situation, 

these and other factors, such as the extent to which a person willfully 

enables fraudulent spoofing of telephone numbers or assists telemarketers 

in blocking Caller ID, by offering either functionality to clients, can be 

relevant in determining liability for TCPA violations. Similarly, whether a 

person who offers a calling platform service for the use of others has 

knowingly allowed its client(s) to use that platform for unlawful purposes 

may also be a factor in determining whether the platform provider is so 

involved in placing the calls as to be deemed to have initiated them.

30 F.C.C. Rcd. at 7980-81 (footnotes and citations omitted). This non-exhaustive totality of the 

circumstances test is to be applied in each specific case, “considering the goals and purposes of the 

TCPA.” 30 F.C.C. Rcd. at 7980. The goals of the TPCA include “the protection of consumers from 

the nuisance, invasion of privacy, cost, and inconvenience that autodialed and prerecorded calls 

generate.” Wick v. Twilio Inc., No. C16-00914RSL, 2017 WL 2964855, at *3 n. 3 (W.D. Wash. 

July 12, 2017); see 30 F.C.C. Rcd. at 7979-80.

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 24 of 30
25

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

United States District Court

Northern District of California

The 2015 Guidance illustrates the meaning of “initiate” under the TCPA using three 

examples. First, the FCC examined YouMail, an app which “send[s] an automatic text in response 

to a voicemail left by someone who called the YouMail app user.” 30 F.C.C. Rcd. at 7981. The 

FCC determined that YouMail was not the initiator of the texts because the app was purely “reactive 

in nature.” Id. The YouMail app user “determines whether to send the auto-reply text messages, 

which categories of callers should receive auto-replies, how the user’s name should appear in the 

auto-reply, and whether to include a message with the auto-reply . . . .” Id. The FCC noted that 

“YouMail exercises no discernible involvement in deciding whether, when, or to whom an autoreply is sent, or what such an auto reply says . . . .” Id. It accordingly held that YouMail did not 

make or initiate the texts at issue, but merely had a causal role in the sending of the texts. Id. at 

7982. 

By contrast, the FCC found that Glide, an app that allows users to exchange video messages,

initiated texts and was therefore liable under the TCPA. Id. Under the factual scenario examined 

by the FCC,6 Glide automatically sent text message invites to all of a user’s contacts unless the user 

affirmatively opted out. Id. The FCC noted that “the app user plays no discernible role in deciding 

whether to send the invitation text messages, to whom to send them, or what to say in them.” Id. at 

7983. It therefore determined that Glide, not its users, initiated the text invitations to the user’s 

contacts. Id. 

Finally, the FCC examined TextMe, an app that “allows users to send and receive text 

messages within the United States free of charge if both parties are app users.” 30 F.C.C. Rcd. at 

7983. A TextMe user can invite their contacts to join the app by selecting the contacts they want to 

invite. Id. TextMe then sends an invitational text to the selected contacts. Id. at 7984. The content 

of the invitational text is exclusively controlled by TextMe. Id. The FCC noted that TextMe’s 

control over the content of the invitational texts indicated potential TCPA liability. Id. However, 

it balanced that control against the “extent to which the app user decides whether to initiate the 

invitational message,” and concluded that ultimately the user—not TextMe—makes the affirmative 

6 The FCC’s findings with respect to Glide were based on a hypothetical factual scenario because it 

was unclear what functionality the app actually offered. 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 25 of 30
26

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

United States District Court

Northern District of California

choice to send the invitational texts. Id. In holding that TextMe was not subject to TCPA liability, 

the FCC stated: 

While we agree with commenters that TextMe’s control of the content of 

the invitational text message is a reason for concern, and take into account 

the goals and purposes of the TCPA, we conclude that the app user’s actions 

and choices effectively program the cloud-based dialer to such an extent 

that he or she is so involved in the making of the call as to be deemed the 

initiator of the call.

Id. The FCC therefore decided that, like YouMail, TextMe merely had a causal role in sending the 

texts at issue. Id.

The FCC rulings on YouMail and Glide are distinguishable from the facts of this case. 

Unlike YouMail, which the FCC determined was a passive and reactive service, Baker allegedly 

assists in crafting text messages that its client dispensaries then use to solicit business. FAC ¶ 32. 

Thus, Baker has a more active role in texting dispensary customers than YouMail had in texting its 

users’ contacts. Plaintiffs’ allegations about Baker are also not similar to those concerning Glide. 

The FCC determined that Glide users had “no discernible role” in deciding whether and to whom to 

send text messages, whereas Plaintiffs in this case acknowledge that Baker’s clients collaborate with 

Baker in formulating and sending texts. See FAC ¶ 33. Therefore, the client dispensaries have more 

control than Glide users over whether and to whom texts are sent.

TextMe shares more similarities with Baker. Like TextMe, Baker allegedly provides a 

platform by which its users can send text messages. FAC ¶¶ 27-32. In addition, Baker’s clients, 

much like TextMe users, ultimately decide to send the message. See id. ¶¶ 33. In finding that 

TextMe was not subject to TCPA liability, the FCC relied heavily on the level of control exercised 

by TextMe’s customers because the customers decide “whether to send an invitational message, to 

whom to send an invitational message, and when that invitational message is sent.” 30 F.C.C. Rcd. 

at 7984. In this case, the allegations in the complaint suggest a similarly high level of control by 

Baker’s clients, since client dispensaries “generate text content” and “enter dates and times they 

want texts to be made/initiated.” FAC ¶ 33. Moreover, the FCC found in favor of TextMe even 

though it exclusively controlled the content of the text messages. Here, Baker allegedly 

“collaborates with client dispensaries” through suggesting text content (including deals and loyalty 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 26 of 30
27

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

United States District Court

Northern District of California

programs), but the client dispensaries choose which messages to send. See id. ¶¶ 33, 36. Therefore, 

Baker exercises even less control over the content of messages than TextMe did.

Of the three 2015 Guidance examples, TextMe comes closest to the facts of this case. 

However, the analysis does not end there. The FCC listed additional factors to consider when 

deciding whether an entity was “so involved in placing the call as to be deemed to have initiated it,” 

including “the extent to which a person willfully enables fraudulent spoofing of telephone numbers 

or assists telemarketers in blocking Caller ID” and “whether a person who offers a calling platform 

service for the use of others has knowingly allowed its clients to use that platform for unlawful 

purposes.” 30 F.C.C. Rcd. at 7980. At least some of Plaintiffs’ allegations suggest such conduct. 

They claim that Baker chooses the numbers from which the client dispensaries send text messages, 

and that the numbers are selected in a way to “prevent them from being filtered or rejected, and to 

mask the use of an ATDS.” FAC ¶ 43. Plaintiffs also allege that Baker inaccurately conveys to 

client dispensaries that they can legally text the numbers gathered through their platform “without 

additional customer authorizations.” Id. ¶ 38. The factors relating to fraud and enabling unlawful 

conduct are not showcased in the FCC example cases, and so the court turns to interpreting caselaw 

for guidance. 

2. Caselaw

Wick is instructive. The plaintiff in Wick alleged that defendant Twilio’s texting software 

“allows clients to create text messaging content to be stored on Twilio’s hosted platform and that 

Twilio uses the stored content to automatically build and send text messages to specified numbers.” 

2017 WL 2964855, at *2. Twilio allegedly created messages for its customers or “reassemble[d] 

content provided by customers to make it more palatable to carriers.” Id. at *4. Twilio also chose 

“what number a message will be sent from in order to prevent messages from being filtered or 

rejected and to mask the source of the calls it initiates” and decided “the order and timing of 

messages to ensure that the rate at which they are received by the carrier stays below the carrier’s 

spam filter threshold.” Id. at *2-4. According to the plaintiff, Twilio “knows that its platform 

technology can be used to automatically send tens of thousands of text messages that violate the 

TCPA, has bragged that its customers have been able to spam mobile phones using its platform, and 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 27 of 30
28

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

United States District Court

Northern District of California

has failed to require its customers to certify that they are complying with the TCPA.” Id. at *4. 

Applying the fact-based analysis in the FCC’s 2015 Guidance, the court determined that these 

allegations were sufficient to plead that Twilio was “an active participant in developing the message 

the recipient ultimately receives.” Id. at *4. Notably, it stressed Twilio’s role in “controlling the 

initiation of the message (including line selection and timing) to avoid spam filters and hide the 

source of the call, and allowing, if not promoting, unsolicited text message campaigns on its 

platform.” Id. at *4. In denying Twilio’s motion to dismiss, the court observed that “the FCC has 

not created a blanket rule immunizing from TCPA liability cloud-based service providers that 

transmit third-party content.” Id. 

A recent case in this district reached a similar conclusion. De la Cabada v. Ytel, Inc., Case 

No. 19-cv-07178-JSC, 2020 WL 1156909 (N.D. Cal. Mar. 10, 2020). In De la Cabada, the 

defendant Ytel, Inc. (“Ytel”) provided a cloud-based text messaging and calling system. Id. at *1. 

One of its customers (“MJM”) ran a gospel ministry and used Ytel’s platform to send millions of 

unsolicited texts and calls that purportedly came from a prophet. Id. at *1-2. The plaintiffs were 

recipients of some of those contacts and sued Ytel. They alleged that Ytel played an “integral role” 

in the spam messages, including by selling MJM “custom short codes” and bulk phone numbers to 

avoid call blocking. Id. at *2-4. The plaintiffs also claimed that Ytel knew MJM was using its 

platform to violate the TCPA, since one of the plaintiffs had notified Ytel about a default judgment 

she had obtained against MJM in another TCPA action. Id. *5. Ytel moved to dismiss, arguing 

(among other things) that it did not initiate the texts and calls. Following the FCC’s 2015 Guidance, 

the court determined that “[t]here are no factual allegations that plausibly support an inference that 

Ytel created the content of the communications, or determined when, how, and to whom the 

communications were sent.” Id. at *4. However, it found that the plaintiffs’ allegations “support a 

plausible inference that Ytel was aware of MJM’s repeated TCPA violations and nonetheless 

continued to facilitate them . . . , including with spoofing and call blocking functionality.” Id. at *5. 

It noted that Ytel advertised that it assists clients in “running campaigns that are [TCPA] compliant,” 

and so its failure to investigate a claim against one of its clients suggested it was aware of the TCPA 

violations and did not take action. Id. at *5. The court accordingly held that the plaintiffs had 

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 28 of 30
29

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

United States District Court

Northern District of California

adequately alleged that Ytel was “so involved with the communications as to be deemed to have 

made them.” Id. at *4. 

Both Wick and De la Cabada relied heavily on the plaintiffs’ allegations that the defendant 

platform engaged in fraud or knowingly enabled unlawful conduct. De la Caboda found a plausible 

inference of TCPA liability in the absence of any allegations that Ytel participated in choosing the 

timing, content, or recipients of the messages. In this case, Plaintiffs claim that Baker chooses the 

numbers the texts will be sent from in order to prevent the numbers from being filtered and to “mask 

the use of an ATDS.”

7

 According to Plaintiffs, Baker advises clients on the legality of using 

telemarketing texts and about how to comply with the TCPA. FAC ¶¶ 43, 104, 110, 152. The Baker 

application ran by Herban Legend linked to Baker’s TOC and privacy policy. Id. ¶¶ 76-77. These 

allegations give rise to a plausible inference that Baker “knowingly allow[s] its client(s) to use [its] 

platform for unlawful purposes,” including the sending of the text messages at issue in this case. 

See 30 F.C.C. Rcd. at 7980.

In sum, some of the factors articulated by the FCC favor Baker and some favor Plaintiffs. 

These factors must be weighed in light of the “goals and purposes of the TCPA,” including 

protecting consumers from “the nuisance, invasion of privacy, cost, and inconvenience that 

autodialed and prerecorded calls generate.” 30 F.C.C. Rcd. at 7879-80. Baker, as alleged by 

Plaintiffs, is more than a passive service platform. It represents itself as an “industry-leading CRM 

platform” that holds a significant market share of cannabis dispensaries in the United States. See 

Listing Statement at 52. According to Plaintiffs, Baker actively encourages its clients to engage in 

text-based marketing campaigns, helps shape their messaging strategy, and expands their 

advertising reach. See FAC ¶¶ 21-26, 32-35. It also holds itself out as TCPA-compliant and 

provides its clients with TOCs and privacy policies. Id. ¶¶ 43, 76-77, 104, 110, 152. Taking the 

allegations in the complaint as true, Baker is significantly involved in its clients’ marketing efforts, 

7 Baker argues that it merely provides dispensaries with numbers that match their physical location 

and so its choice of numbers is not fraudulent. Mot. at 23. The court cannot determine, on a motion 

to dismiss, whether such conduct was designed to deceive, since that goes to the merits. Plaintiffs 

adequately allege that the numbers are chosen at least in part to avoid call blocking and disguise the 

automated nature of the text. For example, Plaintiffs allege that Mile High sent Komaiko texts from 

three different numbers. FAC ¶ 42. Using multiple numbers for the same dispensary suggests intent 

to evade call screening.

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 29 of 30
30

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

United States District Court

Northern District of California

including by collecting contact information, informing dispensary customers of their privacy rights, 

suggesting content, and storing and sending the messages. It is plausible to infer that Baker would 

be aware when its services, which extend beyond its texting platform, are used to send unsolicited 

advertising texts. Moreover, Baker’s alleged strategies to avoid call-blocking give rise to a plausible 

inference that Baker is not merely aware that its clients engage in such conduct, it actively supports 

it. It would not serve the purposes of the TCPA to allow Baker to encourage the proliferation of

text campaigns while knowingly permitting or willfully enabling its clients to violate the TCPA. 

Considering the totality of the circumstances, Plaintiffs’ allegations regarding the extent of 

Baker’s involvement in its clients’ telemarketing text campaigns raise a plausible inference that 

Baker initiated the texts received by Plaintiffs. Accordingly, Baker’s motion to dismiss the 

complaint on this basis is denied.

IV. CONCLUSION

For the reasons stated above, Defendants’ motion to dismiss under Rule 12(b)(2) is granted 

as to TILT and denied as to Baker. Defendants’ Rule 12(b)(6) motion is denied.

The court will hold a case management conference on June 3, 2020 at 1:30 p.m. The parties 

shall file an updated joint case management statement by May 27, 2020.

IT IS SO ORDERED.

Dated: April 

______________________________________

Donna M. Ryu

United States Magistrate Judge

Case 4:19-cv-03795-DMR Document 52 Filed 04/20/20 Page 30 of 30