Court Opinion

ID: 204956
Source: CourtListenerOpinion
Date Created: 2011-02-17 00:10:07+00
Date Added: 2024-06-11T12:36:08.291127
License: Public Domain

FILED
                            NOT FOR PUBLICATION                              FEB 16 2011

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

                           FOR THE NINTH CIRCUIT

CHARLOTTE MALONEY, on behalf of                  No. 09-56805
herself and all persons similarly situated,
                                                 D.C. No. 5:08-cv-01885-SGL-
              Plaintiff - Appellant,             AGR

  v.
                                                 MEMORANDUM *
VERIZON INTERNET SERVICES, INC.;
and GTE.NET LLC, d/b/a/ Verizon
Internet Solutions,

              Defendants - Appellees.

                    Appeal from the United States District Court
                        for the Central District of California
                    Stephen G. Larson, District Judge, Presiding

                           Submitted February 14, 2011 **
                               Pasadena, California

Before: KLEINFELD, LUCERO ,*** and GRABER, Circuit Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. Fed. R. App. P. 34(a)(2).

       ***  The Honorable Carlos F. Lucero, United States Circuit Judge for the
Tenth Circuit, sitting by designation.
      Plaintiff Charlotte Maloney appeals from the district court’s dismissal, under

Federal Rule of Civil Procedure 12(b)(6), of this diversity action against

Defendants Verizon Internet Services, Inc., and GTE.NET LLC, d/b/a Verizon

Internet Solutions. Reviewing de novo, Manzarek v. St. Paul Fire & Marine Ins.

Co., 519 F.3d 1025, 1030 (9th Cir. 2008), we affirm.

      Defendants stated that a subscriber would receive Internet service at a speed

"up to 3 Mbps." 1 As the "Terms of Service" contract explained, Defendants

promised to provide "qualified [high-speed Internet] lines at the maximum line rate

available to your location . . . . The speed of the Service will vary based on

network or Internet congestion, your computer configuration, the condition of your

telephone line and the wiring inside your location, among other factors." Because

the maximum line rate available at Plaintiff’s location was 1.792 Mbps,

Defendants provided her high-speed Internet line at that maximum speed.

      The district court properly dismissed Plaintiff’s claim that Defendants

engaged in a "fraudulent business act or practice" under the Unfair Competition

Law ("UCL"), Cal. Bus. & Prof. Code § 17200. The "reasonable consumer"

standard applies to that claim. Williams v. Gerber Prods. Co., 552 F.3d 934, 938

(9th Cir. 2008). "Under the reasonable consumer standard, [Plaintiff] must show

      1
          Mbps means megabits per second, or one million bits per second.

                                          2
that members of the public are likely to be deceived." Id. (internal quotation marks

omitted). A reasonable consumer would not have been deceived by Defendants’

statements, which included the qualifier "up to" (meaning the same or less than)

and an explanation that each consumer’s maximum speed would vary depending

on several listed customer-specific factors, including factors that applied to

Plaintiff.

       For similar reasons, the district court properly dismissed Plaintiff’s claim

that Defendants engaged in an "unfair . . . business act or practice" under the UCL,

Cal. Bus. & Prof. Code § 17200. Because Defendants’ statements were not

misleading and because it is reasonable to charge the same fee to customers

receiving a range of speeds, no unfairness occurred.2

       The district court properly dismissed Plaintiff’s claims under the Consumer

Legal Remedies Act ("CLRA"), Cal. Civ. Code § 1770. As Plaintiff concedes in

her opening brief, "the same criteria" apply to the CLRA claims as to the UCL

claims. Because the UCL claims fail, so do the CLRA claims.

       2
        The proper test for determining whether a business practice is "unfair" in
the consumer action context under California law is unclear. Lozano v. AT&T
Wireless Servs., Inc., 504 F.3d 718, 736 (9th Cir. 2007). We assume that the
balancing test continues to apply. Plaintiff makes no argument under any other
test.

                                           3
       The district court properly dismissed Plaintiff’s contract claim because

Defendants did not breach the contract. See Walsh v. W. Valley Mission Cmty.

Coll. Dist., 78 Cal. Rptr. 2d 725, 733 (Ct. App. 1998) (stating elements of a

contract claim, which includes breach). Defendants provided Plaintiff with

Internet service with a speed "up to 3 Mbps," subject to the express disclaimer that

a lower maximum speed might apply depending on, among other factors,

Plaintiff’s location.

       The district court properly dismissed Plaintiff’s claim that Defendants

breached the implied covenant of good faith and fair dealing, because the contract

was not silent or ambiguous on the question of maximum speed. See Rose v.

Wells Fargo & Co., 902 F.2d 1417, 1426 (9th Cir. 1990) (holding that a claim of

breach of the implied covenant is available only "when the contract between the

parties is silent or ambiguous on that subject" (citing Gerdlund v. Elec. Dispensers

Int’l, 235 Cal. Rptr. 279, 286 (Ct. App. 1987)).

       AFFIRMED.

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