United States District Court, S.D. New York
SIOBHAN MORROW and ASHLEY GENNOCK, on behalf of themselves and all others similarly situated, Plaintiffs,
ANN INC., Defendant.
OPINION AND ORDER
PAUL OETKEN, United States District Judge
Siobhan Morrow and Ashley Gennock, on behalf of themselves
and all others similarly situated, initiated this action on
May 5, 2016, and filed the operative First Amended Complaint
on July 15, 2016. (Dkt. No. 23 ("Compl.").).
Plaintiffs allege that Defendant Ann Inc. ("Ann")
engaged in a deceptive pricing and advertising scheme
involving merchandise sold in its Ann Taylor Factory and LOFT
Outlet stores (the "Outlet Stores") in violation of
federal and state law. Ann moves to dismiss all claims
against it for lack of subject matter jurisdiction and for
failure to state a claim, under Federal Rules of Civil
Procedure 12(b)(1) and 12(b)(6). For the reasons that follow,
the motion is denied.
Ann is a retail seller of women's apparel, shoes, and
fashion accessories, sold under the "Ann Taylor"
and "LOFT" brand names, including at the LOFT
Outlet and Ann Taylor Factory outlet stores. (Compl. ¶
17.) Plaintiffs shop at the Outlet Stores. (Id.
¶¶ 11, 15-16.)
purchased a pair of pants from an Ann Taylor Factory store in
San Diego, California; Gennock purchased a pair of pants from
an Ann Taylor Factory store in Grove City, Pennsylvania, and
two knit tops from a LOFT Outlet store, also in Grove City.
(Id. ¶¶ 15-16.) Plaintiffs allege that
they would not have purchased these garments, or would have
paid less for them, were it not for Ann's false and
misleading advertising. (Id.)
allege that Ann, whose principal place of business is in New
York, engaged in a nationwide campaign of falsely claiming-on
its sales tags, in-store signage, and website-that products
sold in the Outlet Stores were originally or regularly sold
at much higher prices. (Id. ¶¶ 2, 17.)
Plaintiffs claim that Ann generated “phantom markdowns,
” by advertising discounted prices, based on a false
full price (at which the clothing had never been marked for
sale). (Id. ¶ 3.) The products sold at a
supposed discount in the Outlet Stores, Plaintiffs allege,
are manufactured specifically for the Outlet Stores and were
not previously sold in Ann's retail stores, rendering
“illusory” any advertised “discount”
on original prices. (Id. ¶¶ 3, 7.)
Ann's pattern of false markdowns was “likely to
mislead reasonable consumers” into purchasing
particular products on the mistaken belief that they were
getting a good deal. (Id. ¶¶ 8-9.)
claim that Ann's conduct violates state and federal law.
In particular, Plaintiffs allege violations of
California's Business & Professions Code §17200,
et seq. (the “UCL”), California's
Business & Professions Code §17500, et seq.
(the “FAL”), the California Consumers' Legal
Remedies Act, California Civil Code §1750, et
seq. (the “CLRA”), Pennsylvania's Unfair
Trade Practices & Consumer Protection Law, 73 Pa. Stat.
§ 201-1, et seq. (the “UTPCPL”), as
well as the laws of numerous other states, and the Federal
Trade Commission Act, 15 U.S.C. § 45, et seq.
(“FTCA”), which prohibits “unfair or
deceptive acts or practices in or affecting commerce, "
id. § 45(a)(1), and dissemination of false
advertisements, id. § 52(a). Plaintiffs also
bring a claim of unjust enrichment. (Compl. ¶¶
bring their suit against Ann as a putative class action,
pursuant to Rule 23 of the Federal Rules of Civil Procedure,
on behalf of themselves and all others similarly situated,
both nationwide and in individual states. Ann moved to
dismiss on August 15, 2016.
case is properly dismissed for lack of subject matter
jurisdiction under Rule 12(b)(1) when the district court
lacks the statutory or constitutional power to adjudicate
it." Makarova v. United States, 201 F.3d 110,
113 (2d Cir. 2000) (citing Fed.R.Civ.P. 12(b)(1)). When
resolving a Rule 12(b)(1) motion, a district court may refer
to evidence outside the pleadings, and the plaintiff bears
the burden to prove subject-matter jurisdiction by a
preponderance of the evidence. See id.
survive a Rule 12(b)(6) motion to dismiss, a plaintiff must
allege "enough facts to state a claim to relief that is
plausible on its face." Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). A claim is facially
plausible "when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged."
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In
considering a motion to dismiss, courts must accept as true
all "factual allegations contained in the complaint,
" Twombly, 550 U.S. at 572, and must draw
"all inferences in the light most favorable to the
non-moving party, " In re NYSE Specialists Sec.
Litig., 503 F.3d 89, 95 (2d Cir. 2007) (Sotomayor, J.).
Federal Rule of Civil Procedure 9(b), a plaintiff alleging
fraud must state her claim "with particularity."
Fed.R.Civ.P. 9(b). The Second Circuit has "held that
Rule 9(b) requires that a complaint '(1) specify the
statements that the plaintiff contends were fraudulent, (2)
identify the speaker, (3) state where and when the statements
were made, and (4) explain why the statements were
fraudulent.'" DiMuro v. Clinique Labs.,
LLC, 572 F.App'x 27, 30 (2d Cir. 2014) (quoting
Mills v. Polar Molecular Corp., 12 F.3d 1170, 1175
(2d Cir. 1993)).
argues that Plaintiffs' claims should be dismissed for
several reasons. First, Ann argues that Plaintiffs lack
constitutional and statutory standing to bring any of their
claims. Second, Ann argues that Plaintiffs' claims under
the Consumer Protection Laws of California and Pennsylvania
must be dismissed for failure to state a claim. Third, Ann
argues that Plaintiffs' UCL claim, which is based on
their rights under the FTCA, should be dismissed because the
FTCA does not authorize a private right of action directly.
Finally, Ann argues that Plaintiffs fail to state a claim for
unjust enrichment. The Court addresses each of these
arguments in turn.
courts are courts of limited jurisdiction, ' possessing
‘only that power authorized by Constitution and
statute.'” Gunn v. Minton, 133 S.Ct. 1059,
1064 (2013) (quoting Kokkonen v. Guardian Life Ins. Co.
of Am., 511 U.S. 375, 377 (1994)). Ann argues that
Plaintiffs lack constitutional standing for all claims and
statutory standing for the California and Pennsylvania law
claims, as well as the other state consumer-protection law