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In Re Cablevision Consumer Litigation

March 28, 2012

IN RE CABLEVISION CONSUMER LITIGATION


The opinion of the court was delivered by: Seybert, District Judge:

MEMORANDUM & ORDER

Plaintiffs Sean Ahearn, Eric Bohm, John Brett, Angelo Brucchieri, William G. Canfield, Ralph Dudley, Arthur Finkel, Salvatore A. Gandolfo, Tina Green, Andrew Koplik, David Menoni, Theodore Pearlman, Vincent Pezzuti, Dorothy Rabsey, Martin Jay Siegel, Stanley J. Somer, and Marc Tell (collectively, "Plaintiffs"), on behalf of themselves and all others similarly situated (collectively, the "Class") sued Defendants Cablevision Systems Corporation and CSC Holdings, LLC (together, "Defendants" or "Cablevision") in a case arising out of a two-week period in 2010 during which Cablevision subscribers were not able to watch certain programming. Pending before the Court is Cablevision's motion to dismiss (Docket Entry 34). For the following reasons, this motion is GRANTED IN PART AND DENIED IN PART. The Court also makes a consolidation ruling at the conclusion of this Memorandum & Order.

BACKGROUND

The following discussion is drawn from Plaintiffs' allegations, which are assumed to be true for the purposes of this motion, and from certain documents inherent in the Consolidated Amended Complaint (the "CAC"). See, e.g., Hutchison v. Deutsche Bank Sec. Inc., 647 F.3d 479, 481 (2d Cir. 2011).

Cablevision provides telecommunications and cable television services to more than five million households in the New York and Philadelphia broadcasting area. (CAC ¶ 16.) In certain locations, it is the only cable television provider. (Id.)

During the relevant times, Plaintiffs, who are divided into New York, Connecticut, and New Jersey subclasses, were Cablevision customers. Cablevision had advertised and/or promoted that it carried certain programming and networks, including WNYW ("Fox 5"), WWOR ("My9 Channel"), and the Fox Business Network (collectively, the "Fox Channels"). On October 15, 2010, however, Cablevision's agreement with News Corp., the Fox Channels' parent, expired. (Id. ¶ 21.) Cablevision rejected numerous proposals for a new agreement, including proposals offering the same terms and conditions as other content providers in the New York broadcasting area. (Id. ¶ 23.)

Two weeks later, on the eve of a National Football League game between the New York Jets and the Green Bay Packers, Cablevision and News Corp. arrived at a new agreement and access to the Fox Channels was restored to Cablevision's subscribers. (Id. ¶ 29.) In the interim, Cablevision's customers could not watch Fox's programming, including part of the 2010 World Series. (See id. ¶ 31.) Cablevision's Terms of Service recognize an obligation "to give each customer a credit for each 'known program or service interruption in excess of 24 hours,'" (id. ¶ 23 (quoting Cablevision's Agreement for iO TV)), but aside from offering a ten-dollar credit to customers who ordered World Series coverage on MLB.com or MLB.tv (id. ¶ 31), it has not offered any refund or credit to its customers who were without the Fox Channels for two weeks (id. ¶ 32).

Plaintiffs' case relies in part on the above-mentioned Terms of Service, which provide in relevant part as follows. Paragraph 4 states:

Disruption of Service. In no event shall Cablevision be liable for any failure or interruption of program transmissions or service resulting in part or entirely from circumstances beyond Cablevision's reasonable control. Subject to applicable law, credit will be given for qualifying outages. In any event, if there is a known program or service interruption in excess of 24 consecutive hours (or in excess of such lesser time period pursuant to state law), Cablevision, upon prompt notification of such failure or interruption from Subscriber, will either provide Subscriber with a pro-rata credit relating to such failure or interruption or, at its discretion, in lieu of the credit provide alternative programming during any program interruption. Cablevision shall not be liable for any incidental or consequential damages. (Def. Ex. B, Terms of Service ("TOS") ¶ 4.)*fn1 Paragraph 17 states: "Programming: All programming, program services, program packages, number of channels, channel allocations, broadcast channels, interactive services, e-mail, data offerings and other Services are subject to change in accordance with applicable law." (Id. ¶ 17.)

DISCUSSION

Plaintiffs' Complaint asserts the following causes of action: (1) breach of contract; (2) breach of the covenant of good faith and fair dealing; (3) unjust enrichment; (4) consumer fraud under New York law; (5) consumer fraud under Connecticut law; and (6) consumer fraud under New Jersey law. Plaintiffs also seek an injunction preventing Cablevision from "ignoring its contractual deadlines with content providers," and compelling "it to enter into a dispute resolution mechanism that insures resolution of any such disputes, in the absence of a consensual agreement, so that its customers will not be deprived of programming content." (CAC ¶ 97.) The Court first recites the applicable legal standard and then considers Plaintiffs' claims in turn.

I. Legal Standard

Defendants move to dismiss pursuant to Federal Rule of

Civil Procedure 12(b)(6). To survive a Rule 12(b)(6) motion, a plaintiff must plead sufficient factual allegations in the complaint to "state a claim [for] relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 1974, 167 L. Ed. 2d 929, 949 (2007). The complaint does not need "detailed factual allegations," but it demands "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. at 555. In addition, the facts pleaded in the complaint "must be enough to raise a right to relief above the speculative level." Id. Determining whether a plaintiff has met his burden is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Harris v. Mills, 572 F.3d 66, 72 (2d Cir. ...


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