Sponchiado v. Apple Inc.

Background

Christian Sponchiado and Courtney Davis brought a proposed consumer class action against Apple Inc. They alleged that Apple misrepresented the pixel resolutions and display sizes of the iPhone X, iPhone XS, and iPhone XS Max.

The plaintiffs alleged that Apple’s advertised pixel counts included so-called “false pixels” that shared fractions of subpixels with neighboring pixels. According to the complaint, this meant the screens had only half the advertised number of pixels and two-thirds of the advertised number of subpixels, and could not provide the same clarity as a screen with the advertised resolution.

They also alleged that Apple overstated screen sizes by measuring a hypothetical rectangle that included the rounded corners, rather than only the actual viewable area. They further alleged that Apple obscured the notch on some phones by using images with a planet against a black background. The complaint asserted claims under California’s Consumer Legal Remedies Act, Unfair Competition Law, and False Advertising Law; New York General Business Law sections 349 and 350; common-law fraud; and laws of all fifty states and the District of Columbia.

Apple’s Motion

Apple moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint does not state a legally sufficient claim. Apple also argued that fraud-based allegations did not satisfy Rule 9(b), which requires fraud to be described with particularity. Apple contended that the screen-size disclosures defeated deception and reliance, that the pixel allegations did not state a viable omission or misrepresentation claim, and that the plaintiffs lacked standing to assert claims under laws of states where no named plaintiff resided.

Screen-Size Claims

The court granted dismissal of the claims based on the alleged screen-size misrepresentations, with leave to amend. It held that the complaint itself described disclosures stating that the actual viewable area was less than the area suggested by the diagonal measurement. The court concluded that this qualifying language appeared close enough to the screen-size representations that a reasonable consumer could not be deceived by ignoring it.

The court also rejected the argument that an asterisk or footnote did not qualify the screen-size statement merely because it appeared at the end of the surrounding text rather than directly after the number. An asterisk, the court explained, tells consumers to look for additional information about the statement immediately before it. The court noted, however, that the complaint did not provide enough information to determine whether certain footnotes were too small or obscure. It directed the plaintiffs to include the relevant webpage content in any amended complaint.

The court also stated that Davis could not assert claims under California law because the complaint did not allege that she saw the advertisements or purchased her iPhone product in California. The court rejected Davis’s theory that the advertising was misleading because consumers would not scroll down to see images that might reveal the notch.

Pixel-Count Claims

The court denied Apple’s motion to dismiss the remaining claims based on the alleged pixel-count misrepresentations. Although the complaint described the advertisements in a scattered and not entirely clear way, the court found that it identified the advertisements each plaintiff allegedly saw and the particular pixel-resolution representations on which each plaintiff relied.

The court also rejected Apple’s argument that the plaintiffs had to allege a misrepresentation about subpixels. The court understood the plaintiffs’ theory to be that the advertised pixel count was misleading because it did not represent the number of “true pixels,” not that Apple had separately misrepresented the number of subpixels.

At the motion-to-dismiss stage, the court had to accept the complaint’s factual allegations as true and interpret them in the plaintiffs’ favor. It held that the plaintiffs plausibly alleged that a significant portion of reasonable consumers could be misled by Apple’s pixel-count representations. Whether the plaintiffs’ technical theory was correct, including whether the advertised resolution included “false pixels,” was left for a later stage such as summary judgment.

Claims Under Other Jurisdictions’ Laws

The court dismissed the claims purportedly brought under the laws of jurisdictions other than California and New York without prejudice. It reasoned that the two named plaintiffs were connected to only California and New York, while the complaint sought to assert claims under the laws of the District of Columbia and forty-eight additional states. The court concluded that postponing the standing question until class certification would permit extensive nationwide discovery despite the plaintiffs’ lack of connection to those other jurisdictions.

Disposition

The court granted in part and denied in part Apple’s motion to dismiss. It granted the motion with respect to claims based on the alleged screen-size misrepresentation, with leave to amend; dismissed claims on behalf of putative class members from jurisdictions other than California and New York without prejudice; and denied the motion with respect to the remaining claims based on the alleged pixel-count misrepresentation. Any amended complaint had to be filed within 21 days, could amend only the existing claims, and could not add new claims or parties. The court denied as moot Apple’s request for judicial notice of webpages from Apple’s website.