Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-04662/USCOURTS-cand-5_06-cv-04662-4/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

CONFERENCE—No. C-06-04662 RMW

JAH

United States District Court

For the Northern District of California

E-filed on 11/6/06

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

THERESA B. BRADLEY,

Plaintiff,

v.

YAHOO, INC.,

Defendant.

No. C-06-04662 RMW

ORDER GRANTING MOTION TO DISMISS

WITH LEAVE TO AMEND & RESETTING

CASE MANAGEMENT CONFERENCE

[Re Docket Nos. 7, 12, 15]

Defendant Yahoo, Inc. moves to dismiss the complaint of plaintiff Theresa Bradley. 

Yahoo moves in the alternative for a more definite statement and to strike Bradley's request for

punitive damages. For the reasons set forth below, the court grants the motion to dismiss with

leave to amend and resets the initial case management conference for January 5, 2007 at 10:30

a.m.

I. BACKGROUND

The following facts are taken from the complaint and are assumed to be true, as they must

be on a motion to dismiss under Rule 12(b)(6). Bradley opened an e-mail account with Yahoo in

2002 and a web-hosting account in 2006. Bradley and her associates spent over a thousand hours

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1

 In its motion to dismiss, Yahoo erroneously refers to Bradley's site as www.brava.com, which is

something completely different. 

2

 Yahoo incorrectly states that Bradley's opposition was due on October 12, 2006. See Reply at 1.

3

 Bradley states on the last page of her opposition that she signed and e-mailed it to Yahoo's "Legal

Director" on October 9, 2006. Opp'n at 8.

ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

CONFERENCE—No. C-06-04662 RMW

JAH 2

preparing the content for her website, which Yahoo was to host at www.bravacorp.com.1

Apparently needing a higher level of service, in July 2006 Bradley authorized Yahoo to upgrade

her web hosting account from "Yahoo GEO Cities" to "Yahoo Merchant Solutions" and charge her

credit card accordingly. As Yahoo informed Bradley that her website would be "good to go," she

paid for "a direct mail marketing campaign . . . and an e-mail marketing campaign" to advertise

her website. 

On July 21, 2006, Bradley attempted to access www.bravacorp.com, only to find the site

was inaccessible, as were all of her Yahoo accounts. Three days later, Yahoo informed Bradley

that her accounts had been terminated for unspecified violations of Yahoo policy. Bradley,

however, states that "[n]othing was offensive, illegal, or violated any Yahoo policy, laws, and

rules of [sic?] regulations of any kind, at any time." Yahoo was thereafter unhelpful when Bradley

attempted to restore her Yahoo accounts, retrieve the content she had designed for

www.bravacorp.com, or have www.bravacorp.com hosted by another service provider.

In her complaint, Bradley alleges causes of action for fraud, breach of fiduciary duty,

professional negligence, and "intentional interference with advantageous business relationship."

II. ANALYSIS

A. Late-Filed Opposition

Yahoo calendared its motion to dismiss for November 3, 2006. This made Bradley's

opposition or statement of nonopposition due October 13, 2006.2

 See Civil L.R. 7-3(a), (b). 

Bradley, however, filed her opposition on October 20, 2006.3

 Yahoo also states that Bradley did

not serve it with a copy of her opposition, and that Yahoo only obtained a copy of her opposition

from the court files on the first day it was available, October 27, 2006. 

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ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

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Yahoo nonetheless filed a cogent reply on October 27, 2006. The court notes Yahoo is

represented by attorneys at a large law firm. Yahoo does not appear to have been severely

prejudiced by Bradley filing her opposition a week late, and the court will therefore consider her

opposition (partly because it is short and contains little applicable legal analysis). The court will

also not grant Yahoo's request to dismiss her action for failure to file her opposition in a timely

manner. However, such leniency will not necessarily be forthcoming in the future; all litigants,

whether proceeding pro se or with counsel, are obligated to adhere to all applicable rules. See

Civil L.R. 3-9.

B. Consideration of Yahoo's Terms of Service

The Ninth Circuit has explained that when ruling on a motion to dismiss under Rule

12(b)(6), 

[r]eview is limited to the contents of the complaint. See Enesco Corp. v.

Price/Costco, Inc., 146 F.3d 1083, 1085 (9th Cir. 1998). All allegations of material

fact are taken as true and construed in the light most favorable to the nonmoving

party. See id. The court need not, however, accept as true allegations that

contradict matters properly subject to judicial notice or by exhibit. See Mullis v.

United States Bankr. Ct., 828 F.2d 1385, 1388 (9th Cir. 1987). Nor is the court

required to accept as true allegations that are merely conclusory, unwarranted

deductions of fact, or unreasonable inferences. See Clegg v. Cult Awareness

Network, 18 F.3d 752, 754-55 (9th Cir. 1994). A complaint should not be dismissed

unless it appears beyond doubt that the plaintiff can prove no set of facts in support

of the claim that would entitle the plaintiff to relief. See Morley v. Walker, 175 F.3d

756, 759 (9th Cir. 1999).

Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001), amended, 275 F.3d 1187

(9th Cir. 2001). Yahoo points out—correctly—that the court may consider materials attached to

the complaint as exhibits, Hal Roach Studios, Inc. v. Richard Feiner and Co., 896 F.2d 1542, 1555

n.19 (9th Cir. 1990), and that dismissal may be appropriate if such materials contradict the

allegations of the complaint. See Steckman v. Hart Brewing, Inc., 143 F.3d 1293, 1295-96 (9th Cir.

1998). Similarly, "a district judge may generally consider a document outside the complaint when

deciding a motion to dismiss if the complaint specifically refers to the document and if its

authenticity is not questioned." Inlandboatmens Union of Pac. v. Dutra Group, 279 F.3d 1075,

1083 (9th Cir. 2002). "Where a plaintiff fails to attach to the complaint documents referred to in it,

and upon which the complaint is premised, a defendant may attach to the motion to dismiss such

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documents in order to show that they do not support plaintiff's claim." Wietschner v. Monterey

Pasta Co., 294 F. Supp. 2d 1102, 1110 (N.D. Cal. 2003).

Throughout her complaint, Bradley refers to unspecified Yahoo policies. For example, she

states that she "NEVER violated any of Yahoo, Inc. Policy" (sic), Compl. ¶ 37, "did not violate any

of Yahoo, Inc.'s policies," id. ¶ 45, and that Yahoo refused to tell her "what or which Yahoo policy

she may have violated," id. ¶ 56. Yahoo submits two of its policies, its general terms of service

and terms of service for Yahoo GeoCities. Floyd Decl., Exs. A, B. Yahoo states that Bradley

referred to its general terms of service in her complaint, Floyd Decl. ¶ 2, though Bradley never

specifically identifies in her complaint which Yahoo policies she refers to. Yahoo has not shown

that the court may properly consider Yahoo's general terms of service or the terms of service for

Yahoo GeoCities on this motion to dismiss, and therefore the court shall not consider either

document.

C. Fraud

Allegations of fraud must be pled "with particularity." Fed.R.Civ.P. 9(b). "Fraud can be

averred by specifically alleging fraud, or by alleging facts that necessarily constitute fraud (even if

the word 'fraud' is not used). Under California law, the indispensable elements of a fraud claim

include a false representation, knowledge of its falsity, intent to defraud, justifiable reliance, and

damages." Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1105 (9th Cir. 2003) (some quotation

marks omitted). While Bradley has averred that Yahoo made misrepresentations, the allegations

of her complaint are not made with the particularity required by Rule 9(b). Yahoo's motion to

dismiss this cause of action is granted.

D. Breach of Fiduciary Duty

"The elements of a claim for breach of fiduciary duty are (1) the existence of a fiduciary

relationship, (2) its breach, and (3) damage proximately caused by that breach." Mendoza v. Rast

Produce Co., 140 Cal. App. 4th 1395, 1405 (2006). However, there is generally "no fiduciary

owed duty in a purely commercial situation." McCann v. Lucky Money, Inc., 129 Cal. App. 4th

1382, 1398 (2005). Bradley has not pled the existence of any fiduciary duty; she only mentions

the ordinary commercial relationship for web hosting services between herself and Yahoo. As

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4

 Yahoo's request to strike the language in Bradley's complaint regarding punitive damages—on the

ground that punitive damages cannot be recovered for breaching a contract—is well-taken but moot

since the complaint is being dismissed.

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pled, Bradley's claim is one upon which relief cannot be granted, and Yahoo's motion to dismiss it

is granted.

E. Professional Negligence

Yahoo moves to dismiss Bradley's professional negligence cause of action, arguing that

"because Yahoo! is not a 'professional' as that term is interpreted in the context of professional

negligence," it cannot be liable for professional negligence. Mot. at 11. The California Supreme

Court, however, has explained that professional negligence and ordinary negligence are not

conceptually different claims. Flowers v. Torrance Mem'l Hosp. Med. Ctr., 8 Cal. 4th 992, 996-97

(1994). "With respect to professionals, their specialized education and training do not serve to

impose an increased duty of care but rather are considered additional 'circumstances' relevant to an

overall assessment of what constitutes 'ordinary prudence' in a particular situation." Id. at 997-98. 

"Any distinction between 'ordinary' and 'professional' negligence has relevance primarily when the

Legislature has statutorily modified, restricted, or otherwise conditioned some aspect of an action

for malpractice not directly related to the elements of negligence itself." Id. at 998. As Bradley

has not pointed to any statutory provision making important any distinction between ordinary and

professional negligence, such as California Code of Civil Procedure § 364(f)(2), her cause of

action, though denominated as "professional" negligence, is treated merely as one for ordinary

negligence as a matter of California law. 

Under the economic loss rule, damages for torts cannot be recovered for harms resulting

from the breach of a contract. Aas v. Superior Court, 24 Cal. 4th 627, 643 (2000). Yahoo argues

that the economic loss rule prevents Bradley from recovering on any species of negligence claim. 

Although the contracts on which Yahoo claims Bradley bases her claims—the pair of terms of

service contracts—are not properly before the court on Yahoo's motion to dismiss,4

 it appears that

plaintiff's complaint is for a breach of a contractual provision as opposed to the breach of some

duty of care created by a contract. Plaintiff is given leave to amend to state a cause of action for

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ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

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negligence. However, to plead a cause of action for negligence, plaintiff must set forth the duty of

care owed and how defendant breached that duty by negligent conduct. If plaintiff intends to sue

for breach of contract, she needs to identify the contract and the provision breached and the

damage resulting from the breach. 

F. Intentional Interference with Advantageous Business Relationship

As Yahoo points out, it is not clear what theory Bradley seeks to proceed on in her cause of

action denominated as "intentional interference with advantageous business relationship." The

two likely candidates are the similar torts of interference with contractual relations and

interference with prospective economic advantage. To recover under either, however, Yahoo must

have interfered with Bradley's contract or business relationship with some party other than Yahoo. 

See Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 7 Cal. 4th 503, 515 (1994); Pacific Gas &

Elec. Co. v. Bear Stearns & Co., 50 Cal. 3d 1118, 1126 n.2 (1990). Bradley has alleged no

business relationship or contract with anyone other than Yahoo. Yahoo's motion to dismiss

Bradley's cause of action for "intentional interference with advantageous business relationship" is

therefore granted. 

G. Leave to Amend Complaint

Federal Rule of Civil Procedure 15(a) generally requires leave of court to amend a

complaint, though leave is to "be freely given when justice so requires," Fed.R.Civ.P. 15(a), and it

is generally not appropriate to deny leave "unless it is clear . . . that the complaint could not be

saved by amendment." Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir.

2003). It is clear that Bradley cannot state a claim for breach of fiduciary duty. However, Bradley

may be able to assert one or more tort claims and a breach of contract claim. The court will

therefore allow her twenty days' leave to file an amended complaint, should she wish to file one.

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ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

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III. ORDER

For the foregoing reasons, the court grants Yahoo's motion to dismiss Bradley's complaint

with twenty days' leave to amend except as to a claim for breach of fiduciary duty. The court resets the initial case management conference for January 5, 2007 at 10:30 a.m.

DATED: 11/6/06

RONALD M. WHYTE

United States District Judge

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ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND & RESETTING CASE MANAGEMENT

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A copy of this order was mailed on to:

Plaintiff (pro se):

Theresa B. Bradley 

4500 Connecticut Avenue NW 

Suite 209 

Washington, DC 20008 

Counsel for Defendant:

Kirsten Joy Daru; Michele D. Floyd 

Reed Smith LLP 

Two Embarcadero Center 

Suite 2000 

San Francisco, CA 94111 

Counsel are responsible for distributing copies of this order to co-counsel, as necessary.

Case 5:06-cv-04662-RMW Document 20 Filed 11/06/06 Page 8 of 8