United States District Court, S.D. New York
DIANA DACORTA, individually, and on behalf of others similarly situated, Plaintiff,
AM RETAIL GROUP, INC., d/b/a G.H. BASS & Co., Defendant.
OPINION & ORDER
S. ROMAN, UNITED STATES DISTRICT JUDGE.
Diana DaCorta ("DaCorta" or "Plaintiff),
commenced this putative class action suit against AM Retail
Group, Inc. d/b/a G.H. Bass & Co. ("Bass" or
"Defendant"). This Court has diversity jurisdiction
to hear this matter pursuant to 28 U.S.C. § 1332. The
lawsuit arises from Plaintiffs purchase of a pair of
"Quincy" style boots from Bass's factory outlet
store in Fishkill, New York. Plaintiff alleges that she
purchased this product on the mistaken belief that she was
receiving a steep discount on the merchandise, when in fact
no discount existed at all. Accordingly, Plaintiff alleges
violations of New York General Business Law ("GBL")
§§ 349 and 350 and seeks an injunction and monetary
now moves to dismiss Plaintiffs Amended Complaint ("Am.
Compl.") for lack of standing, pursuant to Fed.R.Civ.P.
12(b)(1), and for failure to state a claim upon which relief
could be granted pursuant to Fed.R.Civ.P. 12(b)(6). For the
following reasons, Defendant's motion is GRANTED in part
and DENIED in part and Plaintiffs Complaint is DISMISSED
commenced this cause of action by filing a putative class
action complaint on March 8, 2016. (See ECF No. 1.)
On August 3, 2016, this Court held a pre-motion conference to
hear Defendant's request to file a motion to dismiss the
complaint. (See Transcript from August 3, 2016
Pre-Motion Conference ("Conf. Tr.") (ECF No. 18).)
During the conference, Defendant argued that the complaint
failed to state a cognizable claim under GBL §§ 349
and 350. Defendant identified specific deficiencies,
(see Conf. Tr. at 9:2-12), and this Court asked if
Plaintiff would consider amending the complaint to cure such
deficiencies, (id at 9:13-10:4.) At the conference,
Plaintiff notified the Court that she likely would not amend
the Complaint, (see Id. at 10:5), but did file an
Amended Complaint shortly after the conference purportedly
addressing the deficiencies discussed thereat, (see
Am. Compl. (ECF No. 20).)
following facts - which are taken from the Complaint and
matters of which the Court may take judicial notice - are
construed in the light most favorable to Plaintiff, as it is
the non-moving party. See, e.g., Kleinman v. Elan
Corp., 706 F.3d 145, 152 (2d Cir. 2013); Gonzalez v.
Hasty, 651 F.3d 318, 321 (2d Cir. 2011). This Court is
also permitted to consider documents attached to
Defendant's brief for purposes of subject matter
jurisdiction. Morrison v. Nat 7 Australia Bank
Ltd, 547 F.3d 167, 170 (2d Cir. 2008).
case is one of many percolating through the federal courts and
aimed at challenging the pricing practices in "outlet
stores" by alleging violations of various state consumer
protection statutes (hereinafter the "Outlet
Cases"). This case concerns the pricing practices of
Bass's outlet stores. (Am. Compl. ¶1.) The facts
here are largely indistinguishable from other Outlet Cases.
Here, Plaintiff alleges that Bass has engaged in the practice
of selling products at outlet stores that are deceptively
sold for a steep discount, when in fact, the products are not
on sale at all. (Id. at ¶¶1-5.)
to Plaintiff, Bass manufactures two lines of merchandise: (1)
product made for retail sale and sold at department stores -
merchandise that is not the subject of this litigation; and
(2) "lesser quality merchandise manufactured
specifically" for sale at Bass outlets. (Am Compl.
¶2.) Relying on the mistaken belief that she was getting
a deep discount, Plaintiff purchased a pair of Quincy boots
from the outlet store on October 13, 2015. (Id.
¶4.) In the outlet stores, some products are listed with
a high price that is stricken out and accompanied by a
placard bearing a significantly lower price. (Id.
¶3.) Such practices create the illusion of a discount,
but in fact the merchandise is "only sold at
the purported 'discount' price." (Id.
at ¶14.) To be sure, Plaintiff alleges that the factory
outlet merchandise is "never offered at the comparison
price." (Am. Compl. ¶3.)
further alleges that the merchandise sold at the Bass outlet
stores is "often of lesser quality." (Am. Compl.
¶¶ 2, 13.) Despite this inferior quality, Plaintiff
alleges that "manufacturers such as Bass seek to trade
on their brand names and the quality of their normal retail
lines" and are thus, "able to charge a premium for
this lesser quality merchandise." (Id.
¶13.) Bass engages in similar pricing practices on its
factory website. (Id. ¶¶ 3, 15.)
October 13, 2015, Plaintiff purchased a pair of
"Quincy" styles boots from Bass's outlet store
in Fishkill, New York. (Id. ¶4.) The Quincy boots
"were displayed with a placard identifying a price of
$180.00, with a 'sale' price of
$44.99." (Id. ¶ 21.) Such information
"creat[ed] the impression of an approximately 75%
discount." (Id.) Despite the signage, in
reality, the Quincy boots are "manufactured for, and
sold exclusively at Bass's factoiy outlet store and the
'factory outlet' page of its website;" they are
"never offered for sale, or sold at the $180.00
price." (Id. at ¶23.) As such, there is no
actual discount, only "the false and deceptive
appearance of a discount." (Id.) Plaintiff
alleges that she purchased the boots thinking she was getting
a steep discount. (Id. ¶22.)
Plaintiff "would not have purchased the Quincy boots, or
would not have paid the amount she did, if not for Bass's
false and deceptive pricing scheme." (Id. at
¶¶ 4, 20, 25.) Plaintiff otherwise alleges that she
was damaged as a result of her purchase, (see Id.
¶6), though she makes no allegations as to the quality
of the Quincy boots she purchased or how they fall short of
what she bargained for.
Standard of Review
challenge to a federal court's subject matter
jurisdiction is properly raised by way of a 12(b)(1) motion.
Morrison v. Nat'l Australia Bank Ltd., 547 F.3d
167, 170 (2d Cir. 2008), affd, 561 U.S. 247 (2010);
Alliance for Envt'l Renewal, Inc. v. Pyramid
Crossgates Co., 436 F.3d 82, 87-88 (2d Cir. 2006).
Without jurisdiction, the Court is devoid of the "power
to adjudicate the merits of the case" and for that
reason, a Court must decide a 12(b)(1) motion before any
motion on the merits. Carter v. HealthPort Tech.,
LLC, 822 F.3d 47, 55 (2d Cir. 2016).
bears the burden to demonstrate standing by showing she is
the "proper party to bring this suit" by a
preponderance of the evidence. Carter, 822 F.3d at 55
(quoting Raines v. Byrd, 521 U.S. 811 (1997));
Morrison, 547 F.3d at 170 (citing Makarova v. United
States, 201 F.3d 110, 113 (2d Cir. 2000)). While a Court
must accept all factual allegations in Plaintiffs complaint
as true, a jurisdictional showing must be made affirmatively;
"it is not made by drawing from the pleadings inferences
favorable to the party asserting it." Morrison, 547 F.3d
at 170; see also TZ Manor, LLC v. Daines, 815
F.Supp.2d 726, 733-34 (S.D.N.Y. 2011), affd, 503 Fed.Appx. 82
(2d Cir. 2012).
challenges pursuant to 12(b)(1) can be factual or facial.
Carter, 822 F.3d at 56; Aikens v. Portfolio Recovery
Assocs., LLC, No. 17-1132, 2017 WL 5590341, at *4, n.2
(2d Cir. Nov. 21, 2017). A facial challenge considers the
sufficiency of the allegations in the complaint. Id.
A factual challenge, on the other hand, questions the
existence of standing. Id. In such circumstances,
the Court may consider evidence outside the pleadings, but
should not consider any "conclusory or hearsay
statements contained in" the evidence. TZ Manor, 815
F.Supp.2d at 733-34. Where a Defendant provides evidence that
controverts material factual allegations in the complaint,
the Court could, and should, make ...