United States District Court, S.D. New York
LAURA TOGUT, on behalf of herself and all others similarly situated, Plaintiff,
FOREVER 21, INC. and FOREVER 21 RETAIL, INC., Defendants.
Attorneys for Plaintiff MCLAUGHLIN & STERN, LLP Lee S.
Shalov, Esq., Bradley J. Bartolomeo, Esq.
Attorneys for Defendants PILLSBURY WINTHROP SHAW PITTMAN LLP
David G. Keyko, Esq. Joseph D. Jean, Esq.
Forever 21, Inc. and Forever 21 Retail, Inc. (collectively,
the "Defendants" or "Forever 21") have
moved pursuant to Federal Rules of Civil Procedure 12(b)(1)
and 12(b)(6) to dismiss the Complaint of Plaintiff Laura
Togut ("Togut" or the "Plaintiff")
alleging causes of action for unjust enrichment, conversion,
and money had and received which arise out of Togut's
purchase of items on Defendants' website for which she
alleges Defendants unlawfully charged her retail sales tax.
Based upon the conclusions set forth below, Defendants'
motion is granted and the Complaint is dismissed.
24, 2017, Plaintiff filed her putative class action Complaint
alleging unjust enrichment, conversion, and money had and
received. Compl. ¶¶ 49-73, Dkt. No. 1. The
Complaint alleges that Defendants fraudulently added a
surcharge, labeled as a "sales tax, " to online
purchases shipped to sales tax exempt jurisdictions, and did
not remit the collected tax to the proper New York authority,
the New York State Department of Taxation and Finance (the
"Department"). See id.
September 18, 2017, Defendants filed the instant motion to
dismiss. Dkt. No. 15. The motion was heard and marked fully
submitted on November 15, 2017.
Complaint sets forth the following facts, which are assumed
true for the purpose of this motion to dismiss. See Koch
v. Christie's Int'l PLC, 699 F.3d 141, 145 (2d
Cir. 2012). As part of a motion to dismiss, a "court may
consider any written instrument attached to the complaint as
an exhibit or incorporated in the complaint by reference, as
well as documents upon which the complaint relies and which
are integral to the complaint." N.Y. Life Ins. Co.
v. U.S., 724 F.3d 256, 258 n.l (2d Cir. 2013) (quoting
Subaru Distribs. Corp. v. Subaru of Am., Inc., 425
F.3d 119, 122 (2d Cir. 2005)).
York City is a jurisdiction that is exempt from retail sales
tax on items priced at less than $110. Compl. ¶ 31. New
York City's sales tax exception includes New York State
retail sales tax, New York City local retail sales tax, and
the Metropolitan Commuter Transportation District
("MCTD") tax, which combined total 8.875%. Compl.
¶¶ 3-4, 29, 31; see also Sales
Tax, City of New York,
(last visited January 15, 2018) .
about May 19, 2017, Plaintiff purchased twenty items of
clothing from Defendants' website,
Forever21.com, for delivery in New York City. Compl.
¶ 28. Each item was priced below $110 and, combined,
totaled $283.40. Compl. ¶ 28, Ex. A. Plaintiff
ultimately paid Defendants a total of $306.30 for her items,
of which $22.90 was labeled a "tax." Compl. ¶
32-33, Ex. A. The items Plaintiff ordered were order and
delivered to her mailing address in New York City. Compl.
¶¶ 29-30. The monies Defendants collected from
Plaintiff under the label of a "tax" were not paid
to the Department. Compl. ¶ 35-36.
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. U.S., 201 F.3d 110, 113 (2d
Cir. 2000). "In resolving a motion to dismiss under Rule
12(b)(1), the district court must take all uncontroverted
facts in the complaint (or petition) as true, and draw all
reasonable inferences in favor of the party asserting
jurisdiction." Tandon v. Captain's Cove Marina
of Bridgeport, Inc., 752 F.3d 239, 243 (2d Cir. 2014).
However, "where jurisdictional facts are placed in
dispute, the court has the power and obligation to decide
issues of fact by reference to evidence outside the
pleadings." Id. "A plaintiff asserting
subject matter jurisdiction has the burden of proving by a
preponderance of the evidence that it exists."
Makarova, 201 F.3d at 113.
Rule 12(b)(6) motion to dismiss, all factual allegations in
the complaint are accepted as true and all inferences are
drawn in favor of the pleader. Mills v. Polar Molecular
Corp., 12 F.3d 1170, 1174 (2d Cir. 1993). 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, 663 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555 (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." Iqbal, 556
U.S. at 663 (quoting Twombly, 550 U.S. at 556). In