Taylor v. Shutterfly, Inc.

Background

Megan Taylor alleged that Shutterfly’s promotions sold through Groupon did not adequately disclose their restrictions. She purchased a promotion on or about November 15, 2017, that offered "$75 to spend at Shutterfly" for $50. According to Taylor, she learned only when she tried to use it that she had received a promotional code—not a dollar credit, gift card, coupon, or other voucher with a $75 value—and that the code could not be combined with other Shutterfly sales or promotional codes.

Taylor sought to represent a proposed class consisting of people who, between December 8, 2013, and the present, purchased in the United States a Groupon deal for a dollar amount toward a purchase on the Shutterfly website. Shutterfly moved under Federal Rule of Civil Procedure 12(f) to strike the class allegations. Alternatively, it moved under Rule 23(c)(1) to deny class certification before discovery was complete.

Motion to Strike Class Allegations

Shutterfly argued that the proposed class was overbroad because some Shutterfly Groupon promotions included disclaimers stating that they could not be combined with other offers or credits. Shutterfly relied on examples attached to a declaration, called the Berry Exhibits, to argue that the class included consumers who were not injured.

The court declined to consider the Berry Exhibits for the Rule 12(f) motion. Under the incorporation-by-reference doctrine, a court may sometimes consider a document outside the complaint as though it were part of the complaint, but the plaintiff must generally rely on the document and its authenticity must not be reasonably disputed. The court found that Taylor’s complaint alleged facts about Shutterfly’s overall conduct and did not specifically rely on the promotions shown in the Berry Exhibits. The court also found Taylor’s challenge to the authenticity of those exhibits reasonable because the declaration stated that the materials were accessed through publicly available links in November 2019, while they purported to show promotions and disclosures presented to consumers in 2015 and 2016.

The court explained that motions to strike class allegations at the pleading stage are generally disfavored and may be granted only in rare circumstances, when the complaint itself shows that a class action cannot be maintained under any set of circumstances. Because Shutterfly’s argument that the class included uninjured consumers depended on evidence the court would not consider, and because factual disputes remained—including whether reasonable consumers would have seen additional disclosures—the court denied the motion to strike the class allegations.

Motion to Deny Class Certification

Shutterfly alternatively argued that Taylor’s injury was not typical of other proposed class members and that she was not an adequate class representative because of an alleged conflict with consumers who were not injured. Shutterfly again relied on the Berry Exhibits.

The court stated that a defendant may bring an early motion to deny class certification, but such motions may be premature. For purposes of the Rule 23 motion, the court considered the Berry Declaration and Exhibits but still found the motion premature. The court noted that thousands of consumers had purchased deals similar to Taylor’s, and that discovery might show that some promotions should be removed from the proposed class. Taylor or the court could modify the class definition at the class-certification stage.

Without a developed factual record, the court could not conclude that Taylor would be unable to meet her burden under Rule 23. The court therefore denied Shutterfly’s motion to deny class certification as premature.

Disposition

The court denied Shutterfly’s motion to strike class allegations or deny class certification at ECF 63. The order did not certify the class or make a final determination on whether the proposed class satisfies Rule 23.