Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Brady v. Anker Innovations Limited

United States District Court, S.D. New York

January 13, 2020

PHILIP BRADY and DUNCAN SMITH individually and on behalf of other similarly situated individuals, Plaintiffs,
v.
ANKER INNOVATIONS LIMITED; ANKER TECHNOLOGY CORPORATION; POWER MOBILE LIFE, LLC; and FANTASIA TRADING, LLC D/B/A ANKER DIRECT, Defendants.

          OPINION & ORDER

          NELSON S. ROMAN UNITED STATES DISTRICT JUDGE.

         Plaintiffs Philip Brady ("Brady") and Duncan Smith ("Smith") (together, "Plaintiffs"), on behalf of themselves and all others similarly situated, bring this putative class action against Defendants Anker Innovations Limited, Anker Technology Corporation, Power Mobile Life, LLC, and Fantasia Trading, LLC, d/b/a Anker Direct ("Fantasia") (collectively, "Defendants"). (First Amend. Compl. ("FAC"), ECF No. 20.) Plaintiffs assert claims under California's Consumer Legal Remedies Act ("CLRA"), Cal. Civ Code §§ 1750-85, California's False Advertising Law ("FAL"), Cal. Bus. & Prof. Code § 17500 et seq., California's Unfair Competition Law ("UCL"), Cal. Bus. & Prof Code §§ 17200-17210, New York's General Business Law ("GBL") §§ 349-350, and several other materially identical state consumer protection statutes. (Id.) Plaintiffs also bring claims for beach of express warranty and unjust enrichment. (Id.)

         Presently before this Court is Defendants' motion to dismiss the FAC for lack of personal jurisdiction and for failure to state a claim. (ECF No. 26.) For the following reasons, Defendants motion is GRANTED in part and DENIED in part.

         BACKGROUND

         The following facts are taken from the FAC and deemed true for purposes of the motion.

         A. The Emergence of Power Banks and Their Uses

         In recent years, consumers have become increasingly dependent on portable electronic devices (“PEDs”), such as phones, tablets, and laptop computers. (FAC ¶¶ 1, 24.) Like any other electronic devices, PEDs require power and periodic recharging. (Id. ¶ 1.) Thus, the portable charger industry emerged. (Id. ¶¶ 2, 25.)

         A portable charger, often called a power bank (“Power Bank”), is a small, portable power source that consumers can use to recharge PEDs. (Id. ¶¶ 2, 26.) In general, the greater the capacity of a Power Bank, which is expressed in milliampere-hours (“mAh”), the more times the Power Bank can be used to recharge PEDs before the Power Bank itself must be recharged. (Id. ¶¶ 2, 26.) For this reason, consumers purportedly have a strong preference, and are willing to pay a premium for, Power Banks with higher mAh ratings. (Id. ¶¶ 2, 26.) Because of this preference, most companies prominently feature the mAh rating of Power Banks in the products' advertising. (Id. ¶ 26.) It is Defendants' representations about the mAh rating of their Power Banks that is at the heart of this lawsuit. (Id. ¶¶ 3-5.)

         B. Defendants Alleged Misrepresentations

         Defendants manufacture, market, and distribute Power Banks. (Id. ¶ 27.) Their Power Banks are sold directly from Defendants' website, from Amazon.com, and from other retailers. (Id.) At both the point of sale and on their Power Banks' packaging, Defendants prominently represent their Power Banks' power capacity as measured in mAh. (Id.)

         Plaintiffs frequently use PEDs during travel and when they do not have access to an electrical outlet. (Id. ¶¶ 10, 12.) Therefore, Plaintiffs each purchased a Power Bank on Amazon.com from Defendants. (Id. ¶¶ 9, 11, 28.) Specifically, on February 25, 2017, Brady purchased an A1211 Astro E1 model Power Bank, which had an expressly advertised “5200 mAh” capacity, and, on June 6, 2016, Smith purchased an A1371 Powercore model Power Bank, which had an expressly advertised “20100 mAh.” (Id. ¶ 28.) Plaintiffs believed that the Power Banks they purchased could deliver a charge to their PEDs that was reflective of the advertised capacity. (Id. ¶ 29.)

         Despite their expectations, however, Plaintiffs came to realize that the Power Banks they had purchased were incapable of delivering the capacity that had been represented to them. (Id.) As such, with the aid of a skilled and experienced testing company, Plaintiffs' tested the Power Banks. (Id. ¶ 30.) That testing revealed that Defendants had substantially inflated their Power Banks' mAh ratings. (Id.) For example, testing showed that Brady's Power Bank, which had been advertised as having a “5200 mAh” capacity, had an “Actual Capacity” of 3285 mAh. (Id.) Similarly, testing revealed that Smith's Power Bank, which had been advertised as having “20100 mAh, ” had an “Actual Capacity” of 12088 mAh. (Id.)

         Plaintiffs contend that Defendants knew the Power Banks' true capacity was substantially lower than advertised. (Id. ¶ 31.) Nevertheless, according to Plaintiffs, Defendants misrepresented the true capacity to get customers to pay a premium. (Id.) Through these false and misleading misrepresentations, Defendants have profited enormously. (Id. ¶ 32.) Even so, Defendants' conduct notwithstanding, Plaintiffs would consider purchasing Defendants' Products again if they could trust that the representations about the mAh rating were correct going forward, which could include redesigning their Power Banks or changing prices to reflect the actual mAh capacity of the battery. (Id. ¶¶ 10, 12.)

         LEGAL STANDARDS

         I. Rule 12(b)(2)

         A court must dismiss an action against any defendant over whom it lacks personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). On a Rule 12(b)(2) motion to dismiss, the plaintiff bears the burden of establishing, by a preponderance of the evidence, that the court has jurisdiction over the defendant. In re Methyl Tertiary Butyl Ether (“MTBE”) Prod. Liab. Litig., 399 F.Supp.2d 325, 330 (S.D.N.Y. 2005). “Where, as here, a court relies on pleadings and affidavits, rather than a full-blown evidentiary hearing, the plaintiff need only make a prima facie showing that the court possesses personal jurisdiction over the defendant.” Id. (quoting Distefano v. Carozzi N. Am., Inc., 286 F.3d 81, 84 (2d Cir. 2001)). In ruling on a 12(b)(2) motion, a court may consider materials outside the pleadings, including affidavits and other written materials. MacDermid, Inc. v. Deiter, 702 F.3d 725, 727 (2d Cir. 2012); Bensusan Rest. Corp. v. King, 937 F.Supp. 295, 298 (S.D.N.Y. 1996), aff'd, 126 F.3d 25 (2d Cir. 1997). The court assumes the verity of the allegations “to the extent they are uncontroverted by the defendant's affidavits.” MacDermid, Inc., 702 F.3d at 727 (internal quotations omitted). Nonetheless, all factual doubts and disputes are resolved in the plaintiff's favor. See A.I. Trad Fin., Inc. v. Petra Bank, 989 F.2d 76, 79-80 (2d Cir. 1993).

         II. Rule 12(b)(6)

         Under Rule 12(b)(6), courts must assess whether a complaint “contain[s] sufficient factual matter . . . 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)); accord Hayden v. Paterson, 594 F.3d 150, 160 (2d Cir. 2010). A court must take all material factual allegations as true and draw reasonable inferences in the non-moving party's favor, but a court is “‘not bound to accept as true a legal conclusion couched as a factual allegation, '” or to credit “mere conclusory statements” or “[t]hreadbare recitals of the elements of a cause of action.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). In determining whether a complaint states a plausible claim for relief, a district court must consider the context and “draw on its judicial experience and common sense.” Id. at 662. A claim is facially plausible when the facts pleaded allow a court to make “a reasonable inference that the defendant is liable for the misconduct alleged.” Id. at 678.

         DISCUSSION

         I. Motion to Dismiss for Lack of Personal Jurisdiction

         Defendants have moved to dismiss the FAC on the basis that the Court lacks personal jurisdiction as to each of the Defendants. (Defs. Mem. of Law in Support of Mot. to Dismiss (“Defs. Mot.”), ECF No. 27, at 5-12.) In opposing Defendants' motion, Plaintiffs have informed the Court that they do not oppose dismissal of Defendants Anker Innovations Limited, Anker Technology Corporation, and Power Mobile Life, LLC, for want of personal jurisdiction. (Pls. Mem. of Law in Opp. to Defs. Mot. to Dismiss (“Pls. Opp.”), ECF No. 29, at 2.) Accordingly, the Court GRANTS this portion of Defendants' motion, thereby dismissing Anker Innovations Limited, Anker Technology Corporation, and Power Mobile Life, LLC, from the case, without prejudice. See Smith v. United States, 554 Fed.Appx. 30, 32 n.2 (2d Cir. 2013) (“[A] dismissal for want of personal jurisdiction is without prejudice.” (citing Elfenbein v. Gulf & Western Indus., Inc., 590 F.2d 445, 449 (2d Cir. 1978)). The below analysis is thus only applicable to Fantasia, the only remaining defendant.

         A. Relevant Facts Regarding Fantasia

         Fantasia, doing business as AnkerDirect, is a subsidiary of Anker Innovations and is organized under the laws of the state of Delaware. (FAC ¶ 13; Decl. of Romeo Luo in Support of Defs. Mot. to Dismiss (“Luo Decl.”), ECF No. 28, at ¶¶ 29-30.) Its principal place of business is in the state of California. (FAC ¶ 13; Luo Decl. ¶ 29.) Fantasia does not have any property, offices, or employees in New York, and it does not manufacture or store any goods in New York. (Luo Decl. ¶¶ 31-33.) During the purported class period, Fantasia marketed, imported, distributed, warranted, and sold Defendants' Power Banks throughout the United States. (FAC ¶ 13.) And, at all relevant times, Fantasia was the account holder for the AnkerDirect Amazon storefront on Amazon.com. (Luo Decl. ¶ 34.)

         AnkerDirect is listed as the “sole authorized seller of authentic Anker products (other than Amazon) on the Amazon platform.” (FAC ¶ 14.) To this end, Fantasia, doing business as AnkerDirect, functions as the Anker distributor in the United States. (Id. ¶ 15.) It ships its products in bulk to Amazon's warehouses in Washington state, in anticipation of consumer purchases on Amazon.com. (Luo Decl. ¶ 34, 37.) Amazon then organizes the products into product listings in a multitude of categories. (Id. ¶ 34.) Once the product is sold, Amazon ships it to the customer. (Id.) Orders made on Amazon.com are fulfilled almost exclusively by Amazon, except under exceptional circumstances. (Id. ¶ 36.) When a customer completes a purchase from the Amazon storefront, they receive an email from AnkerDirect to “[c]heck[] in about” the order. (FAC ¶ 16.)

         Orders of products listed on the AnkerDirect Amazon storefront account for approximately 85% of Fantasia's sales. (Luo Decl. ¶ 35.) But Fantasia also owns and operates a website located at “www.anker.com” (the “Anker Website”), which is hosted by Amazon Web Services. (Id. ¶ 38.) It fulfills orders completed on the Anker Website by shipping products from Fantasia's warehouse in California. (Id. ¶ 39.) Overall, approximately 10% of Fantasia's total, worldwide sales are to New York residents. (Id. ¶ 40.)

         B. Personal Jurisdiction Analysis

         When determining personal jurisdiction over a foreign defendant, courts will follow a two-step inquiry. Licci ex rel. Licci v. Lebanese Canadian Bank, SAL, 732 F.3d 161, 168 (2d Cir. 2013). First, courts assess “whether the defendant is subject to jurisdiction under the law of the forum state-here, New York.” Sonera Holding B.V. v. Cukurova Holding A.S., 750 F.3d 221, 224 (2d Cir. 2014). Second, courts “consider whether the exercise of personal jurisdiction over the defendant comports with the Due Process Clause of the United States Constitution.” Id.

         1. New York's Long-Arm Statute Analysis

         Contending that “Plaintiffs' allegations of personal jurisdiction are so deficient that they do not even satisfy due process, ” Defendants do not address whether New York's long-arm statute, N.Y. C.P.L.R. § 302, confers jurisdiction over Fantasia based on the sale of goods through both its AnkerDirect Amazon storefront and the Anker Website. (Defs. Mot. 6.) The issue warrants discussion.

         Under New York's long-arm statute, “a court may exercise personal jurisdiction over any non-domiciliary . . . who . . . transacts any business within the state or contracts anywhere to supply goods or services in the state.” N.Y. C.P.L.R. § 302(a)(1). “To establish personal jurisdiction under section 302(a)(1), two requirements must be met: (1) [t]he defendant must have transacted business within the state; and (2) the claim asserted must arise from that business activity.” Licci, 732 F.3d at 168 (quoting Solé Resort, S.A. de C.V. v. Allure Resorts Mgmt., LLC, 450 F.3d 100, 103 (2d Cir. 2006)). This is a “single act statute, ” i.e. “proof of one transaction in New York is sufficient to invoke jurisdiction, even though the defendant never enters New York, so long as the defendant's activities here were purposeful and there is a substantial relationship between the transaction and the claim asserted.” Chloé v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158, 170 (2d Cir. 2010) (quoting Kreutter v. McFadden Oil Corp., 522 N.E.2d 40, 43 (N.Y. 1988)). “Purposeful activities are those with which a defendant, through violational acts, avails itself of the privileges of conducting activities within the forum State.” Eades v. Kennedy, PC Law Offices, 799 F.3d 161, 168 (2d Cir. 2015) (quoting Fischbarg v. Doucet, 880 N.E.2d 22, 26 (N.Y. 2007)).

         As to the first requirement, courts analyzing internet activity as a basis for jurisdiction will typically look at “the nature and quality of commercial activity that an entity conducts over the Internet.” Best Van Lines, Inc. v. Walker, 490 F.3d 239, 252 (quoting Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119 (W.D. Pa. 1999)). This involves the use of a “sliding scale” test based on the level of a website's interactivity. EnviroCare Techs., LLC v. Simanovsky, No. 11-CV-3458 (JS)(ETB), 2012 WL 2001443 at *3 (E.D.N.Y. June 4, 2012).[1] Under this test, where a “website is interactive and allows a buyer . . . to submit an order online, courts typically find that the website operator is ‘transacting business'” in the forum state and is thus subject to jurisdiction. Id. (citing Hsin Ten Enter. USA, Inc. v. Clark Enters., 138 F.Supp.2d 449, 456 (S.D.N.Y. 2000)).

         Of course, sellers, such as Fantasia, may not always directly control the website that collects online orders. This, however, does not necessarily defeat jurisdiction. Id. at *3-4; Mopnado, 2016 WL 368166 at *7. Indeed, courts within this circuit have concluded that “[r]egularly offering and selling goods via an online marketplace such as Amazon.com can provide a basis for personal jurisdiction under CPLR § 302(a), even though [d]efendants do not control their Amazon.com ‘storefront' or its interactivity to the same extent that they control their own highly interactive website.” Lifeguard Licensing Corp., 2016 WL 3748480 at *3. The primary consideration is whether the vendor “use[s] [the storefront] ‘as a means for establishing regular business with a remote forum.'” Id. (quoting EnviroCare, 2012 WL 2001443 at *3).

         Here, the Court concludes that Plaintiffs have established that Fantasia transacted business in New York. Fantasia was the account holder for the AnkerDirect storefront on the Amazon platform (Luo Decl. ¶ 34), and it represented itself as the “sole authorized seller of authentic Anker products” on that website. (FAC ¶ 14.) As was the case in EnviroCare, even if it did not “personally manage the website[] through which [it] sold [its] products, ” Fantasia used these websites to expand its nationwide reach. EnviroCare, 2012 WL 2001443 at *4 (citing Dedvukaj v. Maloney, 447 F.Supp.2d 813, 820 (E.D. Mich. 2006)). And in doing so, those “internet-based activities established regular business with foreign jurisdictions, including New York.” Id. In any event, Fantasia also owns and operates a website to sell Anker products. (Luo Decl. ¶ 38; see also Decl. of D. Greg Blankenship (“Blankenship Decl.”), ECF No. 30, Ex. B.) Fantasia's direct operation of this website to fulfill sales provides an alternate basis to conclude that the company has transacted business in New York. See Lifeguard Licensing, 2016 WL 3748480 at *3. Finally, it does not matter that Fantasia's sales to New York only account for 10% of its total, worldwide sales because, as previously explained, a single act is sufficient to support jurisdiction under N.Y. C.P.L.R. § 302(a). See Hypnotic Hats, Ltd. v. Wintermantel Enters., LLC, No. 15-CV-06478 (ALC), 2016 WL 7451306, at *3 (S.D.N.Y. Dec. 27, 2016).

         As to the second requirement, the Court has no trouble determining that Plaintiff's claims arise from its business activity in New York. The crux of Plaintiffs' allegations is that Defendants, including Fantasia, deceived consumers about the power capabilities of its products, which were advertised on ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.