Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-02006/USCOURTS-cand-3_18-cv-02006-1/pdf.json

Nature of Suit Code: 195
Nature of Suit: Contract Product Liability
Cause of Action: 28:1332 Diversity-Other Contract

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

MONTGOMERY BEYER,

Plaintiff,

v.

SYMANTEC CORPORATION,

Defendant.

Case No. 18-cv-02006-EMC 

ORDER GRANTING IN PART AND 

DENYING IN PART DEFENDANT’S 

MOTION TO DISMISS

Docket No. 17

I. INTRODUCTION

Plaintiff Montgomery Beyer (hereafter “Beyer”) brings the instant action alleging that 

certain network security software products sold by Defendant Symantec Corporation (hereafter 

“Symantec”), specifically network security software products sold or licensed to consumers under 

the Norton brand (“Norton Products”) and to businesses under the Symantec brand (“Enterprise 

Products,” and together with the Norton Products, the “Affected Products”), contained critical 

defects. See Docket No. 1 (“Compl.”) ¶¶ 1-2. Beyer’s allegations arise out of a report by Google 

Inc.’s team of expert cybersecurity analysts, Project Zero, which detail alleged vulnerabilities in a 

component of Symantec’s software, the AntiVirus Decomposer Engine. Id. ¶¶ 2, 25. Beyer 

argues that Symantec advertises that the Affected Products “protects against the latest online 

threats” or “protects against viruses, spyware, hackers, rootkits, identity theft, phishing scams, and 

fraudulent Web sites” while knowing that its products suffered from a core decomposer engine 

defect that exposed entire computer operating systems to various security vulnerabilities. Id. ¶¶ 

20-24. Beyer further argues that Symantec failed to disclose that it did not implement patches for 

third-party source code that it used throughout its product line, and various Symantec 

misrepresentations and omissions form the basis for his causes of action. Id. 

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Beyer asserts five causes of action, namely (i) a California Consumer Legal Remedies Act 

(“CLRA”) claim, Cal. Civ. Code §§ 1750, et seq., (ii) a California Song-Beverly Consumer 

Warranty Act claim, Cal. Civ. Code §§ 1790, et seq., (iii) a California False Advertising Law 

(“FAL”) claim, Cal. Bus. & Prof. Code §§ 17500, et seq., (iv) a California Unfair Competition 

Law (“UCL”) claim, Cal. Bus. & Prof. Code §§ 17200, et seq., and (v) a claim for “QuasiContract/Unjust Enrichment.” Id. ¶¶ 51-96. Beyer purports to represent a nationwide class 

combining persons who purchased and/or licensed an Affected Product between December 21, 

2005 and September 19, 2016. Id. ¶¶ 1, 42-50. Beyer further asserts a consumer subclass for 

purposes of the claims under the CLRA and the Song-Beverly Act. Id. ¶ 43. 

Symantec has moved to dismiss for (i) failure to plead the facts and circumstances of the 

alleged fraud with particularity under Fed. R. Civ. P. 9(b), (ii) failure to state a claim under Fed. R. 

Civ. P. 12(b)(6), and (iii) lack of Article III standing under Fed. R. Civ. P. 12(b)(1). For the 

following reasons, the Court DISMISSES without prejudice the CLRA, FAL, UCL, and unjust 

enrichment claims as to the Third Software. The Court also DISMISSES Beyer’s Song-Beverly 

Act claim without prejudice. The Court otherwise DENIES the motion to dismiss. The motion to 

strike is also DENIED.

II. FACTUAL AND PROCEDRUAL BACKGROUND

The complaint alleges the following:

Symantec produces and sells security software under the Symantec and Norton brands. 

Both the Symantec and Norton products contain a key component called the AntiVirus 

Decomposer Engine. This component unpacks compressed executable files so that they can be 

scanned for malicious code. Id. ¶ 2. On June 28, 2016, Google’s Project Zero team released a 

report on alleged vulnerabilities in the AntiVirus Decomposer Engine. Id. ¶¶ 2, 25. Beyer alleges 

that Project Zero discovered that the AntiVirus Decomposer Engine was defectively designed so 

that it unpacked files in the computer operating system’s privileged core, which lies at the core of 

the computing environment and has unrestricted access to and writing permissions for the 

computer’s files (“High Privilege Defect”). Id. ¶ 25. Specifically, Beyer alleges this Engine 

scanned for malicious files by unpacking and examining compressed executable files within the 

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kernel or the root, which resulted from Symantec unnecessarily assigning the highest privilege 

levels to the file scanning and analysis function. Id. The exposure of potentially malicious files in 

this high-privilege environment opened the operating systems up to corruption. Id. ¶ 3. As such, 

Beyer suggests that Symantec violated a key cybersecurity best practice, the principle of least 

privilege, which states that software should operate using the least amount of privilege necessary 

to complete the task. Id. ¶ 26; see also id. ¶ 35-36 (it appears that Symantec also prescribes the 

best practice of “run[ning] the principle of least privilege where possible to limit the impact of 

exploit by threats” as far back as 2007.). Beyer further alleges that Symantec exposed users’ 

computers to a “critical vulnerability” by failing to implement industry-standard security measures 

such as “sandboxing,” i.e., opening files in an isolated virtual environment separate from critical 

processes and programs. Id. ¶ 27. Beyer also alleges that Symantec relied on third party open 

source code to design this Engine but had failed to update the open source code for at least seven 

years, resulting in vulnerabilities that caused “total information disclosure” and “total compromise 

of system integrity” (“Outdated Source Code Defect”). Id. ¶¶ 29-30. As a result, Beyer alleges 

that Symantec sold software that did not conform to cybersecurity best practices, did not 

reasonably protect users’ computer systems against online threats, and made users’ computer 

systems more susceptible to cyberattacks than they would have otherwise been without the 

software. Id. ¶ 7.

Beyer alleges he purchased five Norton Products containing these defects. See Compl. ¶¶ 

10, 20-24. He seeks recovery for the second and third purchases only. See Docket No. 22 

(“Opp”), at 8 n.3. Beyer made his second purchase “in March 2009,” when he bought Norton 360 

Premier, v. 2.0 (“Second Software”). Id. ¶ 21. Beyer alleges that prior to making his purchase he

reviewed the product page on Symantec’s website, which represented that Norton 360 Premier, v. 

2.0, “‘defends you against a broad range of online threats’ through key technologies, including 

antivirus, antispyware, rootkit detection, and automatic updates,” and “provides ‘enhanced 

protection’ through ‘industry leading virus, spyware and firewall protection.’” Id. He does not 

expressly allege that he relied on any of these statements. Id. 

“That same year,” Beyer purchased another Norton 360 Premier, v. 2.0, from Best Buy 

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(“Third Software”). Id. ¶ 22. Prior to doing so, he “reviewed the relevant product page on Best 

Buy’s website” and “relied on similar representations that the Third Software ‘[p]rotects against 

viruses, spyware, rootkits, identity theft, phishing scams, and fraudulent Web sites.’” Id. Beyer 

does not allege that Symantec was responsible for the publication of these representations as 

opposed to, e.g., Best Buy. However, he does allege that, “[t]o the best of his knowledge, Mr. 

Beyer also reviewed and relied upon the various comparable representations and statements on the 

software’s packaging and box in connection with the purchase.” Id. Plaintiff also generally 

alleges that “Plaintiff and the Consumer Subclass relied to their detriment on Defendant’s 

misrepresentations and omissions in purchasing and licensing the Norton Products.” Compl. ¶ 62. 

III. DISCUSSION

A. Article III Standing as to the Enterprise Products

To satisfy Article III's case or controversy requirement, a plaintiff must demonstrate that 

he or she has suffered an injury in fact, that the injury is traceable to the defendant's conduct, and 

that the injury can be redressed by a favorable decision. See Fortyune v. Am. Multi-Cinema, Inc., 

364 F.3d 1075, 1081 (9th Cir. 2004). Here, Beyer purchased Norton Products and brings a 

putative class comprising anyone who purchased a Norton or Enterprise Product that contained 

critical defects. See Compl. ¶¶ 1-2, 42. Beyer alleges that both Norton Products and Enterprise 

Products incorporate the AntiVirus Decomposer Engine and were affected by the alleged security 

flaws. Id. ¶ 3. Symantec submits that Enterprise Products differ in that they permit the user to 

centrally manage the security and data on multiple machines. See Docket No. 17 (“Mot.”) at 31 

(citing Pulgram Decl., Ex. D). Symantec thus contends that there is no similarity in the potential 

injury, the essential element of the inquiry for Article III standing. See id. 

However, this does not necessary deprive Beyer of standing to bring class allegations for 

purchasers of the Enterprise Products. The ability to centrally manage security data does not 

gainsay the fundamental defect in the way the Symantec products were designed. The same 

alleged defects exist in both lines of products. Compl. ¶ 3.

This Court, like others in the Northern District, has held that a plaintiff may proceed on 

class claims against unpurchased products if they are “substantially similar” to products he has 

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purchased. Swearingen v. Late July Snacks LLC, No. 13-cv-4324-EMC, 2017 WL 4641896, at *5 

(N.D. Cal. Oct. 16, 2017) (quoting Astiana v. Dreyer’s Grand Ice Cream, Inc., No. C-11-2901 

EMC, 2012 WL 2990766 (N.D. Cal. July 20, 2012)). 

In Astiana, the plaintiffs challenged food labels on Dreyer’s ice cream products, some of 

which they had not purchased. In that case, 

Plaintiffs are challenging the same kind of food products (i.e., ice 

cream) as well as the same labels for all of the products—i.e., “All 

Natural Flavors” for the Dreyer’s/Edy’s products and “All Natural 

Ice Cream” for the Haagen-Dazs products. That the different ice 

creams may ultimately have different ingredients is not dispositive

as Plaintiffs are challenging the same basic mislabeling practice 

across different product flavors. Indeed, many of the ingredients are 

the same . . . . 

Astiana, 2012 WL 2990766, at *13. As a result, the Court held that the plaintiffs had alleged 

sufficiently similarity to survive the pleading stage and that “material differences are better 

addressed at the class certification stage.” Id. 

Similarly, this Court held in Swearingen that the plaintiff had pleaded sufficient similarity 

between purchased and non-purchased cracker and snack chips, because “the non-purchased 

products are different flavors of the same Multigrain Snack Chips product purchased by 

Plaintiffs.” Swearingen, 2017 WL 4641896, at *5. “In addition, Plaintiffs have identified a 

common mislabeling practice across all products.” Id. Swearingen distinguished Kane v. 

Chobani, No. 12-cv-2425-LHK, 2013 WL 5289253 (N.D. Cal. Sept. 19, 2013), which Defendant 

in this case also raises. See Mot. at 32-33. The Kane plaintiffs brought claims regarding Chobani 

yogurts, some of which they had not purchased. The court there denied standing for the nonpurchased yogurts. But as noted in Swearingen, “the court did not hold that the different yogurt 

products were not substantially similar. Rather, the court found that plaintiffs’ complaint 

contained insufficient information for it ‘to discern . . . which products [p]laintiffs are contending 

contained each representation and for which products these representations were false.’” 

Swearingen, 2017 WL 4641896, at *6 (quoting Kane, 2013 WL 5289253, at *11). 

This case is analogous to Astiana and Swearingen. As in Astiana, where the same kind of 

food product (ice cream) was at issue, the same kind of software product is in dispute here, namely 

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antivirus software. And as in Astiana, where the different ingredients did not preclude standing 

because the plaintiff challenged “the same basic mislabeling practice,” the fact that Enterprise 

Products have central management features does not preclude standing, because Plaintiff alleges 

the same security defects in the enterprise and consumer products. 

Kane is distinguishable for the same reasons discussed in Swearingen: The Kane

complaint failed to specify which products contained the flawed labels, while Plaintiff here has 

alleged that the AntiVirus Decomposer Engine is in both consumer and enterprise products. See 

Compl. ¶ 1. Defendant’s citation of Romero v. HP, Inc., No. 16-cv-5415-LHK, 2017 WL 386237 

(N.D. Cal. Jan. 27, 2017), is distinguishable for the same reason. See Mot. at 23 (citing Romero

for its holding that “plaintiff lacked standing for printers she did not purchaser where plaintiff did 

not plead facts that indicated what misrepresentations were made to each printer, and whether the 

misrepresentations were false”). 

Defendant raises a number of dissimilarities between the two product lines, i.e., different 

purchasers (sophisticated business purchasers compared to lay consumer purchasers), different 

sales materials, and different marketing channels. See Mot. at 31. To Defendant, these 

dissimilarities would result in dissimilar injuries (though it does not explain how). See id. Such 

arguments can be addressed at a later stage. See Astiana, 2012 WL 2990766, at *13. For 

purposes of the motion to dismiss for standing (not, e.g., class certification), Plaintiff has alleged 

sufficient similarity between the enterprise and consumer products to proceed. The Court 

therefore DENIES Defendant’s 12(b)(1) motion. For the same reasons, the class allegations are 

not “immaterial” or “impertinent,” and the Court DENIES Defendant’s 12(f) motion to strike 

those allegations. See Mot. at 33-34.

B. Beyer’s Fraud Claims Under the UCL, FAL, and CLRA

Beyer alleges that Symantec’s statements constitute misrepresentations about its products 

in violation of the CLRA, the FLA, and the UCL’s fraudulent prong. Beyer also alleges that 

Symantec’s failure to disclose the defects was an omission in violation of the same statutes. 

The FAL prohibits businesses from disseminating statements that are “untrue or 

misleading, and which is known, or which by the exercise of reasonable care should be known, to 

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be untrue or misleading.” Cal. Bus. & Prof. Code § 17500. The CLRA prohibits “‘unfair methods 

of competition and unfair or deceptive acts or practices’ in transactions for the sale or lease of 

goods to consumers.” Daugherty v. Am. Honda Motor Co., 144 Cal. App. 4th 824, 833 (2006) 

(quoting Cal. Civ. Code. § 1770(a)). “The standards for determining whether a representation is 

misleading under the False Advertising Law apply equally to claims under the CLRA.” Colgan v. 

Leatherman Tool Grp., Inc., 135 Cal. App. 4th 663, 680 (2006). The UCL prohibits “any 

fraudulent business act or practice,” as well as any “unfair, deceptive, untrue or misleading 

advertising” or any violation of the FAL. Id. § 17200. Beyer also alleges that the CLRA and FLA 

violations violated the UCL’s unlawful prong. 

Because Beyer’s claims sound in fraud, the heightened pleading requirements of Rule 9(b) 

apply. Under Rule 9(b), the plaintiff must plead the “who, what, when, where, and how” of the 

alleged misconduct. Kearns v. Ford Motor Co., 567 F.3d 1120, 1124-25 (9th Cir. 2009). This 

requires the plaintiff to allege “an account of the time, place, and specific content” of the false or 

misleading statements. Swartz v. KPMG LLP, 476 F.3d 759, 764 (9th Cir. 2007) (per curiam) 

(internal quotation marks and citation omitted). In addition, the “plaintiff must set forth what is 

false or misleading about a statement, and why.” Vess v. Ciba-Geigy Corp. USA, 317 F. 3d 1097, 

1106 (9th Cir. 2003). 

1. Misrepresentation or Omission

Symantec contends that Beyer’s claims must be dismissed because Symantec’s statements 

about Norton 360, v. 2.0, are mere puffery and would therefore not mislead a “reasonable 

consumer,” as required by the statutes at issue. Consumer Advocate v. Echostar Satellite Corp., 

113 Cal. App. 4th 1351, 1360 (2003); Elias, 950 F. Supp. 2d at 854. Furthermore, Symantec 

argues that even if the statements were not mere puffery, Beyer has failed to “set forth what is 

false or misleading about a statement, and why” as required under Rule 9(b). See ColemanAnacleto v. Samsung Elecs. Am., Inc., No. 16-cv-02941-LHK, 2016 WL 4729302, at *14 (N.D. 

Cal. Sept. 12, 2016). 

a. Affirmative Statements

For the purposes of this motion, the Court only needs to consider whether the following 

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representations are actionable1: 

▪ The Second Software “defends you against a broad range of online threats through key 

technologies, including antivirus, antispyware, rootkit detection, and automatic 

updates.” See Compl. ¶ 21. 

▪ The Second Software provides “enhanced protection” through “industry leading virus, 

spyware and firewall protection.” Id.

▪ The statement on Best Buy’s website that the Third Software “[p]rotects against 

viruses, spyware, hackers, rootkits, identity theft, phishing scams, and fraudulent Web 

sites.” Id. ¶ 22; see Docket No. 23-1.

▪ The “comparable statements and representations” on the Third Software’s packaging 

and box. Id.

As an initial matter, the statements regarding the Third Software cannot support Beyer’s 

claims. The statement that the software protects against various digital maladies was on Best 

Buy’s website; the FAC does not allege that this statement is attributable to Symantec. In the 

absence of allegations to the contrary, absent allegations that the statement is attributable to 

Symantec and not just Best Buy, no claim against Symantec is stated. 

In contrast, the “comparable statements and representations” on the packaging and box, id., 

are attributable to Symantec. However, that allegation runs afoul Rule 9(b), which requires Beyer 

to identify the statements at issue with particularity. The mere allegation that the statements are 

“comparable” to those on Best Buy’s website are insufficient. 

The above claims regarding the Third Software are therefore DISMISSED. Because 

Beyer may be able to make additional allegations to cure these defects, the dismissal is without 

prejudice.

That leaves the statements regarding the Second Software. Symantec argues that these 

statements are puffery. 

 

1 Representations cited in paragraph 18 and 19 in the Complaint are not actionable as they are all 

after Beyer’s dates of purchase. See Compl. ¶¶ 18-19. Beyer’s citation of these materials in his 

opposition to Symantec’s motion to dismiss are thus irrelevant. See Docket No. 22, at 16-17. 

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A misrepresentation must be a “specific and measurable claim, capable of being proved 

false or of being reasonably interpreted as a statement of objective fact.” Rasmussen, 27 F. Supp. 

3d at 1039-40 (citing Coastal Abstract Serv., Inc. v. First Am. Title Ins. Co., 173 F.3d 725, 731 

(9th Cir. 1999)). “Generalized, vague, and unspecified assertions constitute ‘mere puffery’ upon 

which a reasonable consumer cannot rely, and hence are not actionable.” Anunziato v. eMachines, 

Inc., 402 F. Supp. 2d 1133, 1139 (C.D. Cal. 2005) (citing Glen Hollywood Entm’t, Inc. v. 

Tektronix, Inc., 343 F.3d 1000, 1005 (9th Cir. 2003)); accord Consumer Advocate, 113 Cal. App. 

4th at 1361 n.3. “Ultimately, the difference between a statement of fact and mere puffery rests in 

the specificity or generality of the claim. . . . Thus, a statement that is quantifiable, that makes a 

claim as to the specific or absolute characteristics of a product, may be an actionable statement of 

fact while a general, subjective claim about a product is non-actionable puffery.” Demetriades v. 

Yelp, Inc., 228 Cal. App. 4th 294, 311 (2014) (quoting Newcal Indus., Inc. v. Ikon Office Solution, 

513 F.3d 1038, 1053 (9th Cir. 2008)).

For example, in Consumer Advocate, the plaintiffs brought a putative class action against a 

satellite television company under the UCL, FAL, and CLRA for false or misleading ads. The 

statements were that the service would provide “crystal clear digital video,” “CD-quality” audio, 

an on-screen program guide showing the schedule “up to 7 days in advance,” and 50 channels of 

content. Consumer Advocate, 113 Cal. App. 4th at 1353. The court held that the first two 

statements were “mere puffing,” id. at 1361 n.3, and “all-but-meaningless superlatives,” as 

opposed to “factual representations that a given standard is met.” Id. at 1361. In contrast, the 

claims regarding 50 channels and 7 days were factual representations. Id. at 1361-62.

In Elias, a consumer brought a putative class action against Hewlett-Packard. He had 

purchased a laptop from the manufacturer, and he had selected a customization option for a 

graphics card that, unbeknownst to him, required a higher power supply than the laptop supplied. 

This allegedly causes computers to overheat, freeze, crash, and even catch fire. As a result, the 

plaintiff’s laptop malfunctioned and was damaged beyond repair. The plaintiff brought, inter alia, 

claims under the CLRA, FAL, and the fraudulent prong of the UCL for the manufacturer’s alleged 

misrepresentations in the laptop’s capabilities. In purchasing the laptop, the plaintiff had relied on 

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statements on the manufacturer’s website advertising that the computers at issue had “ultrareliable performance,” “full power and performance,” “versatile, reliable system[s],” and were 

“packed with power” and “delivers the power you need.” Elias, 903 F. Supp. 2d at 854. The 

court held that these were “[g]eneralized advertisements” that “say nothing about the specific 

characteristics or components of the computer.” Id. at 855. See also Anunziato, 402 F. Supp. 2d 

at 1140 (statements that a line of laptops has the “latest technology” and “outstanding quality, 

reliability, and performance” are non-actionable puffery, where plaintiff alleged that the laptops 

contained a defect that caused them to overheat).

In L.A. Taxi Cooperative, Inc. v. Uber Techs., Inc., 114 F. Supp. 3d 852, 861 (N.D. Cal. 

2015), the court determined that some statements made by Uber were puffery while others were 

sufficiently specific to be actionable. The complaint alleged that Uber’s advertising made false or 

misleading statements about the safety of its service compared to taxis. Of those statements, the 

court found that “GOING THE DISTANCE TO PUT PEOPLE FIRST” and “BACKGROUND 

CHECKS YOU CAN TRUST” were generalized, unmeasurable, and subjective claims amounting 

to puffery. Id. However, other statements were actionable non-puffery: 

For example, Uber claims that it is “setting the strictest safety 

standards possible,” that its safety is “already best in class,” and that 

its “three-step screening” background check procedure, which 

includes “county, federal and multi-state checks,” adheres to a 

“comprehensive and new industry standard.” Uber has historically 

described its background check procedures as “industry-leading.”

Uber's statements also explicitly compare the safety of its services 

with those offered by taxi cab companies. For example, a statement 

on Uber's blog describing its “rigorous” background check 

procedures reads, “Unlike the taxi industry, our background 

checking process and standards are consistent across the United 

States and often more rigorous than what is required to become a 

taxi driver.”

Id. The court concluded that “[a] reasonable consumer reading these statements in the context of 

Uber’s advertising campaign could conclude that an Uber ride is objectively and measurably safer 

than a ride provided by a taxi or other competitor service, i.e., it is statistically most likely to keep 

riders from harm.” Id. 

Symantec’s statements about the Second Software while somewhat general are sufficiently 

specific so as to not constitute mere puffery at the pleading stage. This case is similar to L.A. Taxi, 

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in which Uber’s description of its background checks as “industry-leading” contributed to an 

actionable impression that an Uber ride is objectively safer. See id. Here, while the statement in 

this case does not contain something akin to the more explicit comparison to competitors, as in 

L.A. Taxi, Symantec’s statement that its software is “industry leading” could lead a reasonable 

consumer to believe that Symantec software would adhere to industry best practices. That is a 

reasonable inference for purposes of the motion to dismiss. Cf. L.A. Taxi (“industry-leading” 

background checks implied degree of safety). Best practices may be sufficiently concrete to be 

provable. For instance, Symantec had best-practice guidelines which were violated by the High 

Privilege Defect and Outdated Source Code Defect. Compl. ¶ 35. 

In contrast, Symantec’s alleged statement that the software “defends you against a broad 

range of online threats through key technologies, including antivirus, antispyware, rootkit 

detection, and automatic updates,” Compl. ¶ 21, is similar to the claims in Elias that the laptops 

have “ultra-reliable performance” and “full power and performance,” Elias, 903 F. Supp. 2d at 

854, and the claims in Anunziato that the laptops there had “outstanding quality, reliability, and 

performance.” Anunziato, 402 F. Supp. 2d at 1140. Those general descriptions are non-actionable 

puffery. 

As for the “industry leading” claim, its misleading nature is dependent on Symantec’s 

failure to disclose the two Defects. The Court therefore turns to California law on misleading 

omissions.

b. Omissions

An omission is actionable “if the omitted fact is (1) contrary to a [material] representation 

actually made by the defendant or (2) is a fact the defendant was obliged to disclose.” Gutierrez v. 

Carmax Auto Superstores Cal., 19 Cal. App. 5th 1234, 1258 (2018) (alteration in original) 

(internal quotation marks omitted) (quoting Daugherty, 144 Cal. App. 4th at 835); accord 

Hodsdon, 891 F.3d at 861. The omitted fact must also be material. See id. at 1256. As for the 

first prong, the Defects’ existence is contrary to Symantec’s representation that its products are 

“industry leading,” as discussed above. The question for the first prong, then, is whether that 

representation and the omitted fact are material. See id. at 1256, 1258. A statement is material “if 

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a reasonable consumer would deem it important in determining how to act in the transaction at 

issue.” Gutierrez, 19 Cal. App. 5th at 1258. “[M]ateriality usually is a question of fact” that 

should be left to the jury unless the statement at issue is “obviously unimportant.” Id. at 1262. 

Symantec’s representation that its products provide “enhanced protection” through “industry 

leading virus, spyware and firewall protection” is not obviously unimportant. Compl. ¶ 21. The 

question of materiality survives the motion to dismiss.

The Defects are also material. The complaint alleges that the High Privilege Defect 

opened up affected machines to “a wide variety of cyberattacks,” some of which qualify as 

“critical” vulnerabilities and require “[v]ery little knowledge or skill” to exploit, according to a 

standard vulnerability scoring system. Id. ¶ 28 (alteration in original). Likewise, the Outdated 

Source Code Defect allegedly exposed affected machines to “[d]ozens of public vulnerabilities,” 

including some that were publicly known. Id. ¶ 29. These vulnerabilities were also rated 

“critical” and required little knowledge to exploit. Id. ¶ 30. Symantec argues that there is no 

indication that the Defects were ever actually exploited and so they cannot be material. It is true 

that the complaint lacks any allegations of such exploits. However, Symantec’s argument is 

factual in nature and is premature on a motion to dismiss. At the pleading stage, the court draws 

reasonable inferences in the plaintiff’s favor. Given the allegations described above, it is 

reasonable to infer that the Defects are important and material, because they affect the 

effectiveness and function of Affected Products.

The second prong of omission under Gutierrez regards the duty to disclose even in the 

absence of a particular representation. Traditionally under California law, “[t]o state a claim for 

failing to disclose a defect, a party must allege ‘(1) the existence of a design defect; (2) the 

existence of an unreasonable safety hazard; (3) a causal connection between the alleged defect and 

the alleged safety hazard; and that the manufacturer knew of the defect at the time a sale was 

made.’” Williams v. Yamaha Motor Co. Ltd., 851 F.3d 1015, 1025 (9th Cir. 2017) (quoting 

Apodaca v. Whirlpool Corp., No. 13-0725 JVS (ANx), 2013 WL 6477821, at *9 (C.D. Cal. Nov. 

8, 2013)). 

The requirement in Williams that there be a safety hazard has been cast into doubt by 

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recent California Court of Appeal opinions. See Collins v. eMachines, Inc., 202 Cal. App. 4th 

249, 134 Cal. Rptr. 3d 588 (2011); Rutledge v. Hewlett-Packard-Co., 238 Cal. App. 4th 1164 

(2015). These recent appellate decisions extend liability for non-disclosure to beyond safety 

hazards by “sanction[ing] a UCL omission claim when: the plaintiff alleges that the omission was 

material; second, the plaintiff must plead that the defect was central to the product’s function; and 

third, the plaintiff must allege one of the four LiMandri factors.” Hodsdon v. Mars, Inc., 891 F.3d 

857, 863 (9th Cir. 2018) (citing Collins, 134 Cal. Rptr. 3d at 593-95). The LiMandri factors are: 

“(1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had 

exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively 

conceals a material fact from the plaintiff; and (4) when the defendant makes partial 

representations but also suppresses some material facts.” LiMandri v. Judkins, 52 Cal. App. 4th 

326, 336 (1997) (quoting Heliotis v. Schuman, 181 Cal. App. 3d 646, 651 (1986)). Importantly, 

the defect must not only be central to the product’s function; it must also be physical. See 

Hodsdon, 891 F.3d at 864 (Collins and Rutledge require a “physical defect” and the alleged 

existence of slave labor in chocolate supply chain “is not a physical defect at all, much less one 

related to the chocolate’s function as chocolate”). 

Although the Williams test was employed by the Ninth Circuit in Wilson v. HewlettPackard Co., 668 F.3d 1136 (9th Cir. 2012), the California Court of Appeal’s decision in Rutledge

post-data Wilson. And the Ninth Circuit’s decision in Hodsdon considered whether Collins and 

Rutledge effectively overruled Wilson’s safety-hazard requirement. In that case, Hodsdon had 

sued the Mars chocolate manufacturer for failing to disclose that its suppliers used forced and 

child labor. The district court had dismissed under 12(b)(6), and the Ninth Circuit affirmed. In 

doing so, the court did not decide which of the two standards applied because the court found that 

the complaint would fail under either standard. See Hodsdon, 891 F.3d at 864. Nevertheless, it 

suggested that a non-disclosure claim may lie under either of the standards:

The recent California cases show that Wilson’s safety hazard 

pleading requirement is not necessary in all omission cases, but that 

the requirement may remain applicable in some circumstances. In 

other words, Collins and Rutledge are not necessarily irreconcilable 

with Wilson because, where the challenged omission does not 

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concern a central functional defect, the plaintiff may still have to 

plead a safety hazard to establish that the defendant had a duty to 

disclose. For example, . . . Wilson may still apply where the defect 

in question does not go to the central functionality of the product, 

but still creates a safety hazard.

Id. (footnote omitted). 

Because the complaint in the instant case does not allege a safety hazard, the issue under 

Collins and Rutledge is whether the High Privilege Defect and Outdated Source Code Defect 

constitute “physical” defects that were “central” to the Affected Products’ function. 

These Defects may be considered “physical.” As the California appellate court has noted 

in the very context, “computer software . . . may be characterized as tangible property” because 

the software is “‘recorded in a physical form which has physical existence, takes up space on the 

tape, disc, or hard drive, makes physical things happen, and can be perceived by the senses.’” 

Microsoft Corp. v. Franchise Tax Bd., 212 Cal. App. 4th 78, 87 (2012) (quoting South Cent. Bell 

Tel. Co. v. Barthelemy, 643 So.2d 1240, 1246 (La. 1994)). Software is “a certain arrangement of 

matter,” which is “physically recorded on some tangible medium[] [and] constitutes a corporeal 

body.” Id. (quoting Barthelemy, 643 So.2d at 1246). This is unlike the use of child labor in the 

production of a chocolate bar in Hodson, which is non-physical. See Hodsdon, 891 F.3d at 864. 

The next question is whether under Collins and Rutledge these High Privilege Defect and 

Outdated Source Code Defect are central to the Affected Products’ function. In Collins plaintiffs 

had complained that a computer chip in eMachine computers caused “critical data corruption” of 

the hard drive. Id. at 862. In Rutledge, the plaintiffs alleged that defective inverters in Hewlett 

Packard’s laptops caused the screens to darken. These defects are “central to the product’s 

function” because they “render[] those products incapable of use by any consumer.” Id. at 864 

(emphasis omitted). In contrast, the Hodsdon plaintiff’s opposition to the use of slave labor in 

producing chocolate is “based on subjective preferences” which some consumers do not share. Id.

Here, the complaint sufficiently alleges the Defects are central to the function of the 

Affected Products of safeguarding computers against online threats, virus, spyware, etc. The 

Defects allegedly open up the operating systems to corruption, create a “critical vulnerability” to 

online threats, and make computers more susceptible to cyberattacks than they would have 

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otherwise been without the software. Compl. ¶¶ 3, 7, 29-30. Although the complaint does not 

identify specific instances of resulting damage to computers loaded with the Affected Products, cf. 

Williams v. Yamaha Motor Co., Ltd., 851 F.3d 1015, 1028-29 (9th Cir. 2017) (alleged risk of fire 

in defective motors was speculative where the complaint failed to allege that any customer 

experienced such a fire), that is not dispositive to a motion to dismiss where all reasonable 

inferences must be drawn in Plaintiff’s favor.2

2. Reliance

Reliance is required to achieve standing under the UCL, FAL, and CLRA. See Cal. Bus. & 

Prof. Code §§ 17204 (UCL), 17535 (FAL); Cal. Civ. Code. § 1780(a) (CLRA); In re Tobacco II 

Cases, 46 Cal. 4th 298, 328 (2009). Reliance is alleged where the “misrepresentation or 

nondisclosure was ‘an immediate cause’ of the plaintiff’s injury-producing conduct,” such as 

where “the plaintiff ‘in all reasonable probability’ would not have engaged in [that] conduct” in 

the absence of the fraud. Id. at 326 (quoting Mirkin v. Wasserman, 5 Cal. 4th 1082, 1110-11 

(1993) (Kennard, J., concurring in part and dissenting in part)). “[A] presumption, or at least an 

inference, of reliance arises where there is a showing that a misrepresentation was material.” Id. at 

327. Materiality is sufficiently alleged, as discussed above. 

Symantec argues, however, that Beyer’s vague allegations of reliance fall short under Rule 

9(b) because he fails to allege he actually read or relied on any representation. See Mot. at 18. It 

is true that Beyer only alleges that he “reviewed the product page” for the Second Software and 

does not explicitly allege that he saw the statement that the software was “industry leading.” 

Compl. ¶ 21. Nevertheless, it is reasonable to infer for purposes of the motion to dismiss from the 

fact that he reviewed the product page that he saw the “industry leading” statement on the page.

3

 

2 This conclusion is without prejudice to future motions, e.g., for summary judgment or 

adjudication which take into accord the factual record of, inter alia, the frequency of harm 

suffered as a result of the defects.

3 Again, this ruling is without prejudice to any future motions or adjudication should the factual 

record establish Plaintiff cannot meet his burden of proving, e.g., that he saw and read the product 

statement.

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3. Knowledge of the Purported Defects at the Time of Sale

Symantec also argues that Beyer fails to sufficiently allege that it knew of the Defects at 

the time of sale. As an initial matter, Symantec fails to note differences amongst the three statutes 

as to the knowledge requirement. Knowledge of an undisclosed defect is required for a claim of 

misrepresentation to lie under the CLRA. See Coleman-Anacleto v. Samsung Elecs. Am., Inc., No. 

16-cv-2941-LHK, 2017 WL 86033 (N.D. Cal. Jan. 10, 2017) (citing Wilson v. Hewlett-Packard 

Co., 668 F.3d 1136, 1145 (9th Cir. 2012)). A claim under the FAL requires that the defendant 

have known or reasonably should have known that the statement in question was misleading. See 

Cal. Bus. & Prof. Code § 17500. However, knowledge is not required under the UCL’s fraudulent 

prong. See In re Tobacco II Cases, 46 Cal. 4th at 312 (holding that a claim under the UCL’s 

fraudulent prong, in order to fulfil its purpose of protecting the public, does not require that the 

deception be “known to be false to the perpetrator” (quoting Day v. AT&T Corp., 63 Cal. App. 4th 

325, 332 (1998)). The UCL claim therefore survives irrespective of knowledge of falsity.

As for the other claims, Symantec argues that the complaint does not allege that it knew of 

the defects. It points out that the earliest specific allegation of knowledge is when Project Zero 

revealed the defects in 2016, seven years after Beyer’s 2009 purchase of the Second Software. 

The allegations that it knew of the defects at the time of sale, Symantec argues, are conclusory. 

Symantec singles out ¶ 40 of the complaint, which alleges:

As the proprietary owner and licensor of the Affected Products, 

Symantec knew, or was otherwise reckless or willfully blind in not 

knowing, that its AntiVirus Decomposer Engine suffered from 

extremely serious defects, i.e., the High Privilege Defect and the 

Outdated Source Code Defect. Furthermore, Symantec knew, or was 

otherwise reckless or willfully blind in not knowing, that its security 

practices diverged significantly from its own best practices 

recommendations. 

Beyer’s Opposition merely parrots this paragraph. See Docket No. 22 (“Opp.”) at 16. Despite 

this, the complaint sufficiently alleges knowledge, because it alleges that Symantec designed and 

produced the software in question. It plausibly follows from this fact that Symantec knew how the 

Second Software functioned, including that the software unpacked potentially malicious files in a 

high-privilege environment. It also plausibly follows that Symantec knew it had used third-party 

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code and knew it did not patch that code when updates were released by the third parties. 

Furthermore, as early as 2007, Symantec published best-practice guidelines advising readers to the 

principle of least privilege and to keep third-party code updated. See Compl. ¶ 21. Together, this 

suffices to establish knowledge, which need only be plead generally. See Fed. R. Civ. P. 9(b) 

(“Malice, intent, knowledge, and other conditions of a person’s mind may be plead generally.”). 

But the allegations suffice at the pleading stage. The CLRA and FAL claims therefore survive.

In sum, the Court DISMISSES without prejudice Beyer’s fraud claims as to the Third 

Software. The motion is otherwise DENIED. 

4. Song-Beverly Act Claim

Under the Song-Beverly Act, “every sale of consumer goods that are sold at retail in this 

state shall be accompanied by the manufacturer’s and retail seller’s implied warranty that the 

goods are merchantable,” unless such warranty is properly disclaimed. Cal. Civ. Code § 1792. 

Consumer goods are those that are “primarily for personal, family, or household purposes, except 

for clothing and consumables.” Id. § 1791(a). The warranty means that the goods: 

(1) Pass without objection in the trade under the contract 

description.

(2) Are fit for the ordinary purposes for which such goods are used.

(3) Are adequately contained, packaged, and labeled.

(4) Conform to the promises or affirmations of fact made on the 

container or label.

Id. § 1791.1(a). Beyer alleges that Symantec’s Second Software violated each of these four 

warranties. Compl. ¶ 72; see Opp. at 21.

Symantec argues that the Song-Beverly claim fails because Beyer failed to allege that the 

Second Software was “sold at retail in this state.” It notes that Beyer is a resident of Michigan and 

that Beyer alleges only that he “purchased an upgrade to Norton 360 Premier, v. 2.0.” Compl. 

¶ 21. Beyer’s responds that the Second Software’s end user license agreement selects California 

law in its choice of law provision. See id. ¶ 11. And under California law, title passes at the time 

and place that “the seller completes his performance with reference to the physical delivery of the 

goods.” Cal. Comm. Code § 2401(2). Where the contract does not require the seller to deliver the 

goods to the buyer, “title passes to the buyer at the time and place of shipment.” Id. § 2401(2)(a). 

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Beyer states in his brief that he bought the Second Software on Symantec’s website, and that 

Symantec “shipped” the product to him from California by electronic delivery, so that titled 

passed—and thus was “sold at retail”—in California. However, as Symantec correctly points out, 

these facts are missing from Beyer’s complaint. Neither does he allege that the product was 

electronically delivered to him from California.4 The Song-Beverly claim is therefore 

DISMISSED with leave to amend.

5. UCL Claim

Apart from the fraudulent and unlawful prongs of the UCL, Beyer also asserts claims 

under the unfair prong:

90. Defendant’s actions as alleged in this Complaint constitute an 

“unfair” practice, because they offend established public policy and 

are immoral, unethical, oppressive, unscrupulous, and substantially 

injurious to Defendant’s customers. The harm caused by 

Defendant’s wrongful conduct outweighs any utility of such conduct 

and has caused substantial injury to Plaintiff and the Nationwide 

Class. Defendant could and should have chosen one of many 

reasonably available alternatives, including not selling antivirus 

products that contained fundamental defects with the core engine, 

disclosing the defects to prospective purchasers, and/or not 

representing that its products were suitable for ordinary consumer or 

business use. Additionally, Defendant’s conduct was “unfair,” 

because it violated the legislatively declared policies reflected by 

California’s strong consumer protection and false advertising laws, 

including the CLRA, CAL. CIV. CODE §§ 1750 et seq. and the 

FAL, CAL. BUS. & PROF. CODE §§ 17500 et seq. 

See Compl. ¶ 90. 

As an initial matter, the Court agrees with Symantec that the “unfair” claim relies on the 

same factual allegations as those underlying the “unlawful” and “fraudulent” claims, meaning it 

sounds in fraud and Rule 9(b) applies. See Kearns v. Ford Motor Co., 567 F.3d 1120, 1127 (9th 

Cir. 2009). Because the allegations regarding the Third Software are lacking under Rule 9(b) as 

discussed above, those claims under the unfairness prong are DISMISSED without prejudice. 

 

4 Symantec also argues that the cases Beyer cites are inapposite because they pertain to 

conventional purchases not conducted online. See Docket No 24 (Reply) at 11. However, 

California case law supports Beyer’s position that § 2401(2)(a) applies to online purchases. See 

Cal. State Elecs. Ass’n v. Zeos Int’l Ltd., 41 Cal. App. 4th 1270, 1275-77 (1996); see also In re 

Seagate Tech. LLC Litig., No. 16-cv-0523-JCS, 2017 WL 3670779, at *16 (N.D. Cal. Aug. 25, 

2017). 

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However, the allegations regarding the Second Software are sufficient in this regard.5 

Symantec also argues that Beyer’s unfairness claim fails the applicable substantive 

standard. Since Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co., 20 Cal. 

4th 163 (1999), the California Court of Appeal has been split on the appropriate standard to apply 

in a consumer action under the unfair prong of the UCL. In Graham v. Bank of America, N.A., 

226 Cal. App. 4th 594 (2014), the court described the three lines of cases on the issue post-CelTech. While Graham endorsed a line of cases with a “more rigorous test” under which “a plaintiff 

. . . must show the ‘defendant’s conduct is tethered to an[] underlying constitutional, statutory, or 

regulatory provision, or that it threatens an incipient violation of an antitrust law, or violates the 

policy or spirit of an antitrust law.’” Id. at 613 (quoting Wilson v. Hynek, 207 Cal. App. 4th 999, 

1008 (2012)), it acknowledged other court have applied a broader balancing test of unfairness, e.g.

weighing the utility of the defendant’s conduct against the gravity of the harm to the victim. Id. at 

612-613. 

Under either test, the complaint survives. Under the more rigorous test, Beyer has 

sufficiently identified a California public policy against misleading marketing statements, as 

embodied in the CLRA, FAL, and the UCL’s fraudulent prong. Because Symantec’s statements 

regarding the Second Software, as alleged, contravene this public policy, Beyer has made out a

claim as to that product. Cf. In re Carrier IQ, Inc., 78 F. Supp. 3d 1051, 1116, 1117 (N.D. Cal. 

2015). 

6. Quasi-Contract/Unjust Enrichment Claim

That leaves Beyer’s claim for unjust enrichment. California courts have stated that courts 

may construe an unjust enrichment claim “as a quasi-contract claim seeking 

restitution.” Rutherford Holdings, LLC v. Plaza Del Rey, 223 Cal. App. 4th 221, 231 (2014). 

“The doctrine (of unjust enrichment) applies where plaintiffs, while having no enforceable 

contract, nonetheless have conferred a benefit on defendant which defendant has knowingly 

 

5 Symantec also argues that the unfairness claim should fail, because its factual basis overlaps 

entirely with the fraudulent and unlawful claims, which fail. Because the fraudulent and unlawful 

claims survive, this argument in inapposite.

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accepted under circumstances that make it inequitable for the defendant to retain the benefit 

without paying for its value.” Hernandez v. Lopez, 180 Cal. App. 4th 932, 938 (2009). 

Symantec’s only argument against the unjust enrichment claim is that it fails because Beyer’s 

other claims fail. Because Beyer’s other claims do survive as to the Second Software, the unjust 

enrichment claim also survives as to that software. The motion is DENIED to that extent. But 

because the claims as to the Third Software do not survive for lack of specificity under Rule 9(b), 

the unjust enrichment claim is DISMISSED without prejudice as to the Third Software.

IV. CONCLUSION

For the foregoing reasons, the Court DISMISSES without prejudice the CLRA, FAL, 

UCL, and unjust enrichment claims as to the Third Software. The Court otherwise DENIES the 

motion to dismiss. The motion to strike is also DENIED. 

This order disposes of Docket No. 17. 

IT IS SO ORDERED.

Dated: September 21, 2018

______________________________________

EDWARD M. CHEN

United States District Judge

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