Court Opinion

ID: 150373
Source: CourtListenerOpinion
Date Created: 2010-07-10 00:03:32+00
Date Added: 2024-06-11T08:37:13.586063
License: Public Domain

FILED
                            NOT FOR PUBLICATION                             JUL 09 2010

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

                            FOR THE NINTH CIRCUIT

HYPERTOUCH, INC., a California                   No. 09-15943
corporation,
                                                 D.C. No. 3:08-cv-04970-MMC
              Plaintiff - Appellant,

  v.                                             MEMORANDUM *

AZOOGLE.COM, INC., a Delaware
corporation, DBA Epic Advertising, Inc.;
QUICKEN LOANS, INC., a Michigan
corporation; SUBSCRIBERBASE, INC., a
South Carolina corporation, DBA
Addrive.com, DBA Consumer Research
Corporation, Inc., DBA Free Slide, Inc.,
DBA Subsriberbase Holdings, Inc.,

              Defendants - Appellees.

                  Appeal from the United States District Court
                     for the Northern District of California
               Maxine M. Chesney, Senior District Judge, Presiding

                       Argued and Submitted April 13, 2010
                            San Francisco, California

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Before: SCHROEDER and N.R. SMITH, Circuit Judges, and MOODY, District
Judge.**

      Plaintiff-appellant Hypertouch, Inc. (“Hypertouch”) is an internet service

provider that filed this action pursuant to California Business and Professions Code

§ 17529.5(a) against defendants-appellants Azoogle.com, Inc. and Subscriberbase,

Inc., commercial e-mail advertisers, and defendant-appellant Quicken Loans, Inc.

(collectively “Azoogle”), a company that hired Azoogle.com to transmit its

commercial e-mail advertisements.

      The complaint alleges that Azoogle has directed over 380,000 misleading e-

mail advertisements that have resulted in financial injury to Hypertouch.

Hypertouch seeks statutory and actual damages for each of the close to half a

million alleged advertisements, but its complaint refers in general terms only to

eleven examples.

      The district court ruled that Hypertouch had failed to comply with the

heightened pleading provisions of Federal Rule of Civil Procedure 9(b) relating to

complaints alleging fraud. Hypertouch declined to make any amendment, elected

to take a dismissal, and filed this appeal.

        **
             The Honorable James Maxwell Moody, Senior United States District
Judge for the District of Arkansas, sitting by designation.

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      We agree with the district court that the causes of action as pled sound in

fraud. See Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103-04 (9th Cir.

2003). Not only does the California statute speak in terms of commercial e-mail

advertisements that contain “falsified,” “misrepresented,” “forged,” or misleading

information, see Cal. Bus. & Prof. Code § 17529.5(a)(2)-(3), terms common to

fraud allegations, but Hypertouch’s own complaint repeatedly describes the

advertisements and their content as “fraudulent.” It cannot circumvent the

requirements of the Federal Rules of Civil Procedure by arguing that it did not

plead all of the allegations sufficiently to set forth a claim of fraud. See Kearns v.

Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009); Vess, 317 F.3d at 1103-04,

1106-07. We express no opinion as to the degree of particularity required for a

statutory claim of this nature, but the allegations of this complaint were pled with

no degree of particularity.

      We also agree with the district court that Hypertouch’s claims for liquidated

damages under California Business and Professions Code § 17529.5(b)(1)(B)(ii)

were subject to California Code of Civil Procedure § 340(a)’s one-year statute of

limitations. An award of liquidated damages under § 17529.5(b)(1)(B)(ii) has no

relation to the amount of damages actually suffered by the plaintiff or to the

defendant’s culpability in causing those damages, and liquidated damages may be

                                           3
awarded in addition to actual damages. Such an award is therefore a “penalty”

within the meaning of § 340(a). See Murphy v. Kenneth Cole Prods., Inc., 155

P.3d 284, 290 (Cal. 2007).

      The judgment of the district court is AFFIRMED. Azoogle’s request for

judicial notice is denied.

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