Court Opinion

ID: 150560
Source: CourtListenerOpinion
Date Created: 2010-07-14 00:02:51+00
Date Added: 2024-06-11T17:24:21.564548
License: Public Domain

FILED
                           NOT FOR PUBLICATION                              JUL 13 2010

                                                                       MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

CRAIG E. KLEFFMAN, individually and              No. 07-56171
on behalf of all others similarly situated,
                                                 D.C. No. CV-07-02406-GAF
             Plaintiff - Appellant,
                                                 MEMORANDUM *
  v.

VONAGE HOLDINGS CORP., a New
Jersey corporation; VONAGE AMERICA,
INC., a wholly owned subsidiary;
VONAGE MARKETING, INC., a wholly
owned subsidiary,

             Defendants - Appellees.

CRAIG E. KLEFFMAN, individually and              No. 07-56292
on behalf of all others similarly situated,
                                                 D.C. No. CV-07-02406-GAF
             Plaintiff - Appellee,

  v.

VONAGE HOLDINGS CORP., a New
Jersey corporation; VONAGE AMERICA,
INC., a wholly owned subsidiary;
VONAGE MARKETING, INC., a wholly
owned subsidiary,

             Defendants - Appellants.

       *This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                   Appeal from the United States District Court
                      for the Central District of California
                    Gary A. Feess, District Judge, Presiding

                          Submitted December 10, 2008 **
                              Pasadena, California

Before: SILVERMAN and BERZON,*** Circuit Judges, and CONLON,****
District Judge.

      Craig E. Kleffman appeals dismissal of his putative class action for violation

of California’s anti-spam law, Cal. Bus. & Prof. Code § 17529.5(a)(2), against

Vonage Holdings Corp., Vonage America, Inc., and Vonage Marketing, Inc.

(“Vonage”), and denial of leave to amend his complaint to add an unfair

competition claim for injunctive relief under Cal. Bus. & Prof. Code § 17203.

Vonage cross-appeals denial of its motion for attorneys’ fees under the California

Consumers Legal Remedies Act (“Consumers Act”), Cal. Civ. Code § 1780(d)

(now § 1780(e)). We have jurisdiction pursuant to 28 U.S.C. § 1291.

      **
       The panel unanimously finds this case suitable for decision without oral
argument. See Fed. R. App. P. 34(a)(2).
      ***
         This case was submitted to a panel that included Judge Brunetti, who
recently passed away. Judge Berzon was drawn by lot to replace Judge Brunetti.
Judge Berzon has read the briefs and reviewed the record.
      ****
         The Honorable Suzanne B. Conlon, United States District Judge for the
Northern District of Illinois, sitting by designation.

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      We review dismissal of Kleffman’s complaint de novo. Knievel v. ESPN,

393 F.3d 1068, 1072 (9th Cir. 2005). Denial of leave to amend the complaint and

denial of Vonage’s request for attorneys’ fees are reviewed for abuse of discretion.

Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 898 (9th Cir. 2006);

Levald, Inc. v. City of Palm Desert, 998 F.2d 680, 691 (9th Cir. 1993). We affirm.

      Kleffman alleged Vonage violated § 17529.5(a)(2) by sending him eleven

unsolicited e-mail advertisements for its broadband telephone services from eleven

different domain names to bypass spam filters. The anti-spam law prohibits e-mail

advertisements containing or accompanied by falsified, misrepresented, or forged

header information. Cal. Bus. & Prof. Code § 17529.5(a)(2). In light of

California’s anti-spam law’s recent enactment, the lack of interpretive authority,

the likelihood the issue would recur, and the dispositive nature of the issue, we

requested the California Supreme Court to answer the following certified question:

Does sending unsolicited commercial e-mail advertisements from multiple domain

names for the purpose of bypassing spam filters constitute falsified,

misrepresented, or forged header information under Cal. Bus. & Prof. Code §

17529.5(a)(2)?

      The California Supreme Court accepted the certified question and

unanimously held that Vonage’s alleged conduct did not violate § 17529.5(a)(2).

                                          3
Kleffman v. Vonage Holdings Corp., No. S169195, 2010 WL 2471753 (Cal. June

21, 2010). It is undisputed that Vonage’s domain names are part of the e-mails’

header information, actually exist, and are technically accurate, literally correct,

and fully traceable to Vonage’s marketing agents. The only dispute is whether

Vonage’s e-mails contain or are accompanied by misrepresented header

information. Id. at *2. The California Supreme Court held that an e-mail with an

accurate and traceable domain name does not misrepresent header information

under § 17529.5(a)(2) because it makes no false representation of fact. Kleffman,

2010 WL 2471753, at *3-4. The court rejected Kleffman’s attempt to define

misrepresented header information to include misleading header information

because the legislative history does not support Kleffman’s expansive construction

of the statute. Id. at *5-6.

       The California Supreme Court has now definitively decided the controlling

issue of state law that was before us. Accordingly, dismissal of Kleffman’s

complaint and denial of leave to amend his § 17529.5(a)(2) claim are affirmed.

We need not address whether the Controlling the Assault of Non-Solicited

Pornography and Marketing (“CAN-SPAM”) Act of 2003, 15 U.S.C. § 7707(b)(1),

preempts § 17529.5(a)(2).

       The district court did not abuse its discretion in denying Kleffman leave to

                                           4
amend his complaint to add an unfair competition claim for injunctive relief under

Cal. Bus. & Prof. Code §§ 17203, 17204. Amendment would be futile. Kleffman

lacks standing to bring the claim because he alleges no deprivation of money or

property as a result of Vonage’s conduct. Id.

      The district court did not abuse its discretion in denying Vonage attorneys’

fees incurred in obtaining dismissal of the Consumers Act claim. That claim was

dismissed because Kleffman is not a consumer under the statute. To the contrary,

he alleged he and the putative class members neither sought nor acquired any

goods or services offered by Vonage. Cal. Civ. Code § 1761(d). Vonage is not

entitled to attorneys’ fees because it failed to establish that Kleffman prosecuted

this case in subjective bad faith. Id. § 1780(d); Corbett v. Hayward Dodge, Inc.,

14 Cal. Rptr. 3d 741, 747-49 (Cal. Ct. App. 2004).

      AFFIRMED.

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