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Readick v. Avis Budget Group, Inc.

United States District Court, Second Circuit

July 3, 2013

JODD READICK, on behalf of himself and all others similarly situated, Plaintiff,


PAUL G. GARDEPHE, District Judge.

In this putative class action, Plaintiff Jodd Readick claims that defendants Avis Budget Group, Inc. and Avis Rent A Car System, LLC (collectively, "Defendants" or "Avis") (1) violated N.Y. Gen. Bus. Law § 349; (2) breached their standardized Rental Agreement; and (3) were unjustly enriched, by failing to properly disclose a convenience fee charged for the use of electronic toll collection devices ("ETD"), such as E-Z Pass, provided in certain rental cars. Avis has moved to dismiss under Fed.R.Civ.P. 12(b)(6). For the reasons stated below, Avis's motion will be denied in part, and granted in part.


On September 18, 2011, Plaintiff rented a vehicle from an Avis location at 147 West 83rd Street in Manhattan. (Marino Cert., Ex. A (Rental Agreement)) The vehicle was equipped with an ETD for use on toll roads, bridges, and tunnels. (Marino Cert., Ex. A; Cmplt. ¶¶ 2, 5)[1] that time, Plaintiff executed a Rental Agreement consisting of a signed form and a document jacket printed with Tercos and Conditions. (See Marino Cert., Ex. A ("By my signature, I acknowledge receipt of all notices which appear on this rental document. I agree to the tercos and Conditions including who may drive the car, which is stated on the rental document jacket provided.")) After returning the vehicle, Plaintiff was charged an ETD convenience fee[2] in addition to actual toll fees he incurred during the rental period. (See Cmplt. ¶ 5)

Plaintiff alleges that Avis did not properly disclose the convenience fee. (Cmplt. ¶ 5) Sections 5 and 23 of the Terms and Conditions provide in relevant part:

5. Rental Charges.... If you use a car with automatic toll payment capability, you will pay us or our toll administrator for all tolls incurred during your rental and all related fees, charges and penalties....
23. Collections. If you do not pay all amounts due to us under this agreement upon demand, including all charges, fees and expenses, including, without limitation, payment for loss of or damage to the car, rental charges, parking and traffic fines and penalties, toll charges, towing, storage and impoundment fees, you agree to pay a late charge of 11/2% per month on the past due balance or the highest rate permitted by applicable law, whichever is less (collectively, "Charges"). For toll charges you will be charged the standard non-discounted fee for toll[] roads as published by the toll authority plus the convenience fee of $2.50 per rental day regardless of whether you use e-Toll or not and up to $10 per week for the use of this service. You agree to also pay for any costs that we incur in seeking to collect such Charges including, without limitation, court costs and attorney's fees in addition to any administrative fees, cost recovery, insufficient funds fees and collection fees (collectively, "Costs").

(Marino Cert., Ex. A)

Plaintiff filed this action in the Supreme Court of the State of New York, New York County. (Dkt. No. 1 ¶ 1) On May 18, 2012, Avis removed the case to this Court on the basis of diversity of citizenship. (Dkt. No. 1 ¶ 2) Avis filed its motion to dismiss on September 26, 2012. (Dkt. No. 20)



"To survive a motion to dismiss, a complaint must contain 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) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570 (2007)). These factual allegations must be "sufficient to raise a right to relief aboye the speculative level." ATSI Commc'ns, Inc. v. Shaar Fund, Ltd. , 493 F.3d 87, 98 (2d Cir. 2007). "In considering a motion to dismiss... the court is to accept as true all facts alleged in the complaint, " Kassner v. 2nd Ave. Delicatessen Inc. , 496 F.3d 229, 237 (2d Cir. 2007) (citing Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals , 282 F.3d 83, 87 (2d Cir. 2002)), and must "draw all reasonable inferences in favor of the plaintiff." Id . (citing Fernandez v. Chertoff , 471 F.3d 45, 51 (2d Cir. 2006)).

A complaint is inadequately pled "if it tenders naked assertion[s]' devoid of further factual enhancement, '" Iqbal , 556 U.S. at 678 (quoting Twombly , 550 U.S. at 557), and does not provide factual allegations sufficient "to give the defendant fair notice of what the claim is and the grounds upon which it rests." Port Dock & Stone Corp. v. Oldcastle NE., Inc. , 507 F.3d 117, 121 (2d Cir. 2007) (citing Twombly , 550 U.S. at 555).

"In considering a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6), a district court may consider the facts alleged in the complaint, documents attached to the complaint as exhibits, and documents incorporated by reference in the complaint." DiFolco, 622 F.3d at 111 (citing Chambers, 282 F.3d at 153; Hayden v. Cnty. of Nassau , 180 F.3d 42, 54 (2d Cir. 1999)). Additionally, "[w]here a document is not incorporated by reference, the court may never[the]less consider it where the complaint relies heavily upon its terms and ...

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