May v. Google LLC

Background

Judy May alleged that she fell victim to a Google Play gift card scam in April 2021. She sued Google LLC, Google Arizona LLC, and Google Payment Corp., collectively referred to as Google. Her complaint asserted claims under California’s Unfair Competition Law, the California Consumers Legal Remedy Act, California Penal Code § 496, and for conversion.

Google moved to dismiss the complaint and separately sought to stay discovery until the dismissal motion was resolved. On July 17, 2024, the court granted in part and denied in part Google’s motion to stay discovery, allowing May to seek discovery for the class period consistent with the applicable statute of limitations. On November 4, 2024, the court granted in part and denied in part Google’s motion to dismiss. It dismissed May’s claim under California Penal Code § 496 to the extent it sought treble damages, without leave to amend, and dismissed May’s remaining claims with leave to amend.

Motion for Reconsideration

Google moved for reconsideration of the July 17 order. A motion for reconsideration asks a court to revisit an earlier ruling. Google argued that new facts warranted reconsideration because May had not pleaded a legally recognizable theory and would have to amend her complaint. Google repeated arguments from its dismissal motion, including that the gift card terms’ limitation of liability might dispose of May’s claims, that Google had no legal duty to investigate every scam claim, and that May had not adequately pleaded several claims. Google also argued that it would be prejudiced by having to respond to discovery while May amended her complaint.

May opposed the motion. She argued that there had been no change in circumstances, that the earlier dismissal motion was not dispositive, and that a discovery stay could threaten settlement efforts and other court-ordered deadlines. She also argued that her discovery requests were reasonable and would not unfairly burden Google.

Court’s Analysis

The court held that Google had not shown a change in circumstances warranting a discovery stay. The court explained that Google assumed May would not receive permission to amend if her claims were inadequately pleaded. That assumption was incorrect because the court had freely allowed May to amend nearly all of her claims. The court therefore found that Google’s earlier dismissal motion was not dispositive and that Google had not shown amendment would be futile. The amended complaint had not yet been filed, and no new dismissal motion had been filed, so the court could not conclude that a discovery stay was warranted.

The court also held that Google had not demonstrated that denying a stay would cause particularized prejudice or an unusual burden. The court found that Google’s speculation that May could not cure the pleading deficiencies was insufficient to establish prejudice.

Disposition

The court denied Google’s motion for reconsideration of the July 17, 2024 order on Google’s motion to stay discovery. The court also vacated the hearing set for January 2, 2025.