United States District Court, D. Arizona
G. Campbell United States District Judge
Mark Schellenbach and William Ryder, on behalf of themselves
and all others similarly situated, filed a complaint against
Defendant GoDaddy.com, LLC. Docs. 1, 33. Plaintiffs seek
monetary and injunctive relief for alleged violations of
Arizona and California law. Id. Defendant has filed
a motion to dismiss pursuant to Rule 12(b)(6) of the Federal
Rules of Civil Procedure. Doc. 43. The motion is fully
briefed (Docs. 43, 52, 61), and neither party has requested
oral argument. For the reasons set forth below, the Court
will grant Defendant's motion as to the negligent
misrepresentation claim and deny it as to all other claims.
is a large technology provider incorporated in Delaware and
headquartered in Scottsdale, Arizona. Doc. 33, ¶ 7. It
sells a variety of services to small businesses, including
internet domain registrations, web-based business
applications, and forms of server access. Id.,
¶¶ 1-3; Doc. 43 at 11. On October 31, 2014,
Defendant issued a press release titled “GoDaddy
Launches New Dedicated and VPS Servers with Added Support for
Designers and Developers.” Doc. 33, ¶ 16; Doc.
52-3 at 2. Named Plaintiffs are website designers based in
Los Angeles, California. Doc. 33, ¶¶ 8-9. In
December 2014 and continuing thereafter, they both purchased
a “Dedicated Server” hosting plan maintained by
Defendant. Doc. 33, ¶ 29. Plaintiffs allege that, after
experiencing “crippling performance issues relating to
the server[, ]” they hired an independent server expert
to diagnose and resolve those issues. Id.,
¶¶ 29, 31. Plaintiffs learned from this expert that
they were actually being provided with a virtualized server.
Id., ¶ 31. Defendant does not dispute that its
Dedicated Server product is virtualized. Doc. 43 at 11.
Rather, Defendant argues that this information was
“clearly and publicly disclose[d].” Id.
at 10. Plaintiffs argue that they “were misled by
[Defendant's] omission of material facts, i.e.
that the ‘Dedicated Servers' marketed and sold by
[Defendant] were, in fact, virtualized.” Doc. 52 at 7.
successful motion to dismiss under Rule 12(b)(6) must show
either that the complaint lacks a cognizable legal theory or
fails to allege facts sufficient to support its theory.
Balistreri v. Pacifica Police Dep't, 901 F.2d
696, 699 (9th Cir. 1990). A complaint that sets forth a
cognizable legal theory will survive a motion to dismiss as
long as it contains “sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim has
facial plausibility when “the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Id., 556 U.S. at 678 (citing
Twombly, 550 U.S. at 556). “The plausibility
standard is not akin to a ‘probability requirement,
' but it asks for more than a sheer possibility that a
defendant has acted unlawfully.” Id. (citing
Twombly, 550 U.S. at 556).
9(b) requires a party alleging fraud to “state with
particularity the circumstances constituting fraud or
mistake.” Fed.R.Civ.P. 9(b). The complaint “must
state the time, place, and specific content of the false
representations as well as the identities of the parties to
the misrepresentation.” Schreiber Distrib. Co. v.
Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir.
1986) (citations omitted). A complaint of fraud must specify
“the who, what, when, where, and how” of the
alleged misconduct. Vess v. Ciba-Geigy Corp., 317
F.3d 1097, 1106 (9th Cir. 2003). “[A] plaintiff in a
fraud-by-omission suit faces a slightly more relaxed burden,
due to the fraud-by-omission plaintiff's inherent
inability to specify the time, place, and specific content of
an omission in quite as precise a manner.” Tait v.
BSH Home Appliances Corp., No. SACV 10-00711 DOC, 2011
WL 3941387, at *2 (C.D. Cal. Aug. 31, 2011); see also
Falk v. Gen. Motors Corp., 496 F.Supp.2d 1088, 1098-99
(N.D. Cal. 2007).
bring claims alleging fraudulent concealment under Arizona
law, negligent misrepresentation under California law,
violations of the Arizona Consumer Fraud Act
(“ACFA”), and violations of California's
false advertising and unfair competition laws. Doc. 33.
Scope of Review and Judicial Notice.
asks the Court to take judicial notice of four exhibits
containing images of Defendant's website. Doc. 43-1. In
making this request, Defendant confuses the doctrine of
incorporation by reference with judicial notice.
“Although often conflated, the doctrine of
incorporation by reference is distinct from judicial
notice.” Hsu v. Puma Biotechnology, Inc., No.
SACV150865AGJCGX, 2016 WL 5859000, at *4 (C.D. Cal. Sept. 30,
2016) (quoting Gammel v. Hewlett-Packard Co., 905
F.Supp.2d 1052, 1061 (C.D. Cal. 2012)) (alterations and
quotation marks omitted). Judicial notice is permitted by the
rules of evidence and allows a court to take notice of facts
that cannot reasonably be disputed. See Fed. R.
Evid. 201(b). Incorporation by reference concerns information
a court may considered when ruling on a motion under Rule
12(b)(6), and permits the court to consider materials
attached to the complaint that are referenced in the
complaint. Hsu, 2016 WL 5859000, at *4. In fact,
“[a] copy of a written instrument that is an exhibit to
a pleading is a part of the pleading for all purposes.”
by reference also allows a court to consider certain
documents referred to or relied upon in a complaint.
Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir.
2005). The Ninth Circuit has provided this explanation:
Generally, the scope of review on a motion to dismiss for
failure to state a claim is limited to the contents of the
complaint. A court may consider evidence on which the
complaint necessarily relies if: (1) the complaint refers to
the document; (2) the document is central to the
plaintiff's claim; and (3) no party questions the
authenticity of the copy attached to the 12(b)(6) motion. The
court may treat such a document as part of the complaint, and
thus may assume that its contents are true for purposes of a
motion to dismiss under Rule 12(b)(6).
Marder v. Lopez, 450 F.3d 445, 448 (9th Cir. 2006)
(internal quotations marks and citations omitted). See
also Harris v. Cty. of Orange, 682 F.3d 1126, 1132 (9th
Cir. 2012); Coto Settlement v. Eisenberg, 593 F.3d
1031, 1038 (9th Cir. 2010).
argues that the Court may “take judicial notice”
of the contents of its website because Plaintiffs
incorporated the website in their Amended Complaint. Doc.
43-1 at 3. Defendant further contends that “[t]here is
no dispute regarding the accuracy or authenticity of
the” webpage copies attached to its motion to dismiss.
Id. at 4. Plaintiffs do not appear to dispute that
the Court may consider two of Defendant's exhibits (C and
D) which contain images of Defendant's website and a
compilation of images included in Plaintiffs' Amended
Complaint, respectively. Id. at 2. These webpages
and images are specifically referred to and relied upon in
Plaintiffs' Amended Complaint, and Plaintiffs do not
dispute their authenticity. Doc. 52 at 13; Doc. 33,
¶¶ 19-24. The Court will consider Exhibits C and D
in ruling on the motion to dismiss.
argue, however, that the Court should not consider Exhibits A
and B, which are two other webpage copies, because they are
not mentioned or relied upon in the Amended Complaint. Doc.
52 at 10. Exhibit A contains a copy of a webpage as saved on
www.archive.org and dated December 26, 2014. Doc.
43-1 at 2. Exhibit B contains a copy of a webpage as it
allegedly appeared on September 28, 2016. Id.
Plaintiffs contend that Defendant has not authenticated these
exhibits, nor shown that they were active or accessible to
Plaintiffs when they purchased their Dedicated Servers.
Id. at 11. Although Plaintiffs refer to these
webpages in their Amended Complaint (Doc. 33., ¶ 3
n.1&2), Plaintiffs dispute the authenticity of the copies
attached to Defendant's motion to dismiss, and whether
they were accessible to Plaintiffs. Doc. 52 at 11-13.
argues that Plaintiffs' challenge to Exhibits A and B as
unauthenticated is without merit given that the Amended
Complaint quotes from the webpages and Plaintiffs admit that
they relied on an archived version of a different page on
Defendant's website. Doc. 61 at 4 n.1. But a court may
grant a motion to dismiss under the doctrine of incorporation
by reference only when the authenticity of the evidence is
not questioned. Coto Settlement, 593 F.3d at 1038.
Plaintiffs clearly dispute the authenticity of Exhibits A and
B, and their citation to an archived version of another of
Defendant's webpages does not change that fact.
even if Exhibits A and B had been authenticated, Defendant
has not shown that they are central or even relevant to
Plaintiffs' claims. Exhibit B is an alleged copy of
Defendant's webpage from September, 2016. Plaintiffs'
Amended Complaint states that Plaintiffs had already stopped
using Defendant's hosting services at that time. Doc. 33,
¶ 34. Exhibit A is an alleged copy of Defendant's
webpage from December 26, 2014. Plaintiffs claim that they
purchased Defendant's Dedicated Server plan in December
2014, leaving doubt as to whether the webpage was accessible
to Plaintiffs at the time of purchase. Additionally,
Plaintiffs' only refer to the webpage in the introduction
section of their Amended Complaint in order to support a
statement concerning the types of sever products that
Defendant offers. Doc. 33, ¶ 3 n.1 & 2. In contrast,
the factual allegations section of the Amended Complaint
relies on images and quotations from Defendant's October
31, 2014 press release, the webpage referenced on that press
release (the same webpage reflected in Exhibits C and D), and
a separate webpage. Id., ¶¶ 16-24. The
factual allegations section does not contain any reference to
the webpages in Exhibits A and B, or any indication that
Plaintiffs reviewed or relied upon them in making their
C and D do not contain any explicit statement of the
Dedicated Server product's virtualized character. Doc.
43-4, 43-5. Defendant's cite Exhibit C to suggest that
its identification of the Dedicated Server as a
“single-tenant VM” constitutes a clear disclaimer
of the virtualized nature of the Dedication Server. Doc. 43
at 12; Doc. 43-4 at 5. Defendant provides nothing to show
that the meaning of “VM” was understood by
Plaintiffs or other ...