June Johnson v. Wal-Mart Stores, Inc. , 544 F. App'x 696 ( 2013 )

FILED
NOT FOR PUBLICATION OCT 30 2013
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
JUNE WOOLVERTON JOHNSON, an No. 12-55233
individual, on behalf of herself and all
others similarly situated, D.C. No. 2:11-cv-06406-R-JC
Plaintiff - Appellant,
MEMORANDUM*
v.
WAL-MART STORES, INC., a Delaware
corporation,
Defendant - Appellee.
Appeal from the United States District Court
for the Central District of California
Manuel L. Real, District Judge, Presiding
Argued and Submitted October 8, 2013
Pasadena, California
Before: PREGERSON, WARDLAW, and TALLMAN, Circuit Judges.
June Johnson appeals the Rule 12(b)(6) dismissal with prejudice of her
putative class action against Wal-Mart. The gravamen of Johnson’s complaint is
that Wal-Mart allegedly misrepresented that it charged her a nine dollar “recycling
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
fee” with her purchase of a seventy-seven dollar car battery because the “recycling
fee” was required by California law, when, in fact, California does not require such
a fee. We have jurisdiction under 28 U.S.C. § 1291, and we reverse.
1. The district court erred by concluding that Johnson alleged insufficient
injury-in-fact under California law to state a claim upon which relief can be
granted. A plaintiff suffers economic injury-in-fact under California law if he
“surrender[s] in a transaction more . . . than he . . . otherwise would have” or is
“required to enter into a transaction, costing money or property, that would
otherwise have been unnecessary.” Kwikset Corp. v. Superior Court, 51 Cal. 4th
310, 323 (2011); accord Hinojos v. Kohl’s Corp., 718 F.3d 1098, 1102 (9th Cir.
2013) (noting that a plaintiff suffers economic injury if induced “to spend more
than he otherwise would have spent”).
Johnson alleges that she would not have paid the additional nine dollar fee if
she had known that California law did not require her to pay it and that Wal-Mart
intended to keep the nine dollars for itself. On a motion to dismiss, we accept
these factual allegations as true. Alvarez v. Chevron Corp., 656 F.3d 925, 930 (9th
Cir. 2011). Drawing upon our “judicial experience and common sense,” Ashcroft
v. Iqbal, 556 U.S. 662, 679 (2009), we conclude that these factual allegations
permit a reasonable inference that Johnson paid more “than she otherwise would
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have” if Wal-Mart had not engaged in the alleged misrepresentation, Kwikset
Corp., 51 Cal. 4th at 323. Johnson’s claim is “plausible on its face” because it is
reasonable to infer that Johnson, if correctly informed, would not have given Wal-
Mart the nine dollar fee in addition to paying seventy-seven dollars for the battery.
Iqbal, 556 U.S. at 678.
The district court erred by relying on Bower v. AT&T Mobility, LLC, 196
Cal. App. 4th 1545 (2011), which is inapposite. In Bower, the plaintiff
characterized her injury as being “denied any opportunity [to] shop around for
retailers that do not charge consumers this discretionary fee.” Id. at 1554
(alteration in original). Here, by contrast, Johnson’s claimed injury is the actual
loss of nine dollars. On appeal, Wal-Mart asserts that Peterson v. Cellco P’ship,
164 Cal. App. 4th 1583 (2008), requires affirmance. In Peterson, however, the
plaintiffs “[did] not allege they paid more for the insurance due to defendant’s
collecting a commission.” Id. at 1591. Here, Johnson does allege that she paid
more because of Wal-Mart’s challenged conduct.
2. The district court also erred by determining that Johnson failed to satisfy
the pleading requirements of Fed. R. Civ. P. 9(b). Rule 9(b) requires a plaintiff
averring fraud to plead the “who, what, when, where, and how” of the alleged
misconduct. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003).
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He must also offer “an explanation as to why the statement or omission
complained of was false or misleading.” In re GlenFed, Inc. Sec. Litig., 42 F.3d
1541, 1548 (9th Cir. 1994) (en banc), superseded by statute on other grounds as
stated in SEC v. Todd, 642 F.3d 1207, 1216 (9th Cir. 2011).
Johnson’s complaint satisfies these requirements. She alleges that, at its
Ridgecrest, California, store on August 3, 2010, Wal-Mart implicitly
misrepresented to her that it was required by law to charge the nine dollar
“recycling fee” by posting a sign stating that “[s]ome states require a fee when you
buy a new battery” and by charging the fee, identifying it as a “recycling fee” on
her receipt. She alleges falsity because California does not require such a fee and
Wal-Mart “actively concealed” the truth. The district court’s stated rationale – that
Wal-Mart’s statements were true and Johnson simply misunderstood the law –
erroneously evaluated the merits of Johnson’s claims rather than the particularity
of her pleadings. Johnson’s allegations make it unequivocally clear to Wal-Mart
what conduct it must defend. See Bly-Magee v. California, 236 F.3d 1014, 1019
(9th Cir. 2001).
3. The district court did not hold that any misrepresentations made by Wal-
Mart were nonactionable statements of the law, Miller v. Yokohama Tire Corp.,
358 F.3d 616, 621 (9th Cir. 2004), as Wal-Mart now suggests. And we decline
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Wal-Mart’s invitation to affirm on these alternative grounds. “If a
misrepresentation as to a matter of law includes, expressly or by implication, a
misrepresentation of fact, the recipient is justified in relying upon the
misrepresentation of fact to the same extent as though it were any other
misrepresentation of fact.” Restatement (Second) of Torts § 545(1) (1977); see
also Miller, 358 F.3d at 621 (discussing the Restatement’s position that
misrepresentations of law are not actionable if they do not “include[] a
misrepresentation of fact”). Wal-Mart’s sign and receipt may well have implied a
factual assertion that California, not Wal-Mart, would receive the recycling fee.
The panel retains jurisdiction over any further appeals in this action.
REVERSED AND REMANDED.
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