Saroya v. University of the Pacific

Background

Viney Saroya filed a proposed class action on behalf of people who paid tuition and fees for the University of the Pacific's Spring 2020 semester and allegedly lost the benefit of education and services because of the university's response to COVID-19. The opinion describes the university as a private university with campuses in Sacramento, San Francisco, and Stockton, California. Saroya was an undergraduate student at the university's San Francisco campus.

The Spring 2020 semester began on or about January 13, 2020. On March 11, 2020, the university announced that in-person classes would be suspended beginning March 23 for the rest of the semester. Classes after that date were provided online. The semester ended on or around May 6, 2020.

Saroya alleged that the university's course catalogs, syllabi, policies, and other materials led him to understand that his courses would be taught in person. He alleged that tuition and fees covered in-person instruction, access to campus facilities, face-to-face interaction, activities, hands-on learning, and other opportunities. He sought a proportional repayment of tuition and fees for services allegedly not provided.

Judicial notice

The court granted in part and denied in part the university's request for judicial notice. It declined to take notice of exhibits attached to the Azlin declaration because the materials were not necessary to the court's analysis. It took judicial notice of exhibits attached to the Pallavicini declaration, including course catalogs, a financial responsibility agreement, and university communications, because Saroya repeatedly referred to them and they were publicly available.

Motion to dismiss

The university moved under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim. It argued that the claims were barred by the educational-malpractice doctrine, that Saroya had not adequately pleaded the state-law claims, and that the requested damages were speculative. It also sought dismissal of the punitive-damages request.

The court rejected the educational-malpractice argument. It explained that the complaint, viewed in Saroya's favor at this stage, challenged the university's alleged failure to provide specifically promised services rather than asking the court to evaluate the quality of teaching, curriculum, instructors, or student achievement. The court therefore declined to dismiss the claims on that basis.

Claim 1: Breach of contract

The court denied the motion to dismiss the breach-of-contract claim. It held that Saroya sufficiently alleged an implied-in-fact contract under California law. The alleged contract could include specific representations in university publications, and Saroya alleged that the university's materials promised in-person educational services and related opportunities. The court stated that changing the nature of the services after students had paid could arguably breach that contract.

The court did not decide the ultimate merits of the contract claim. It stated that arguments concerning the tuition-refund policy, the university's right to modify services and fees, damages, and the value of campus benefits were more appropriate at a later dispositive-motion stage.

Claim 2: Unjust enrichment

The court dismissed the unjust-enrichment claim with leave to amend. Under California law, unjust enrichment describes a restitution theory rather than a standalone cause of action. A quasi-contract claim generally cannot proceed when an enforceable contract covers the same subject. Saroya alleged that an enforceable agreement existed but did not allege that the agreement might be invalid or unenforceable. The court therefore found that he could not maintain the unjust-enrichment theory as pleaded, while allowing amendment.

Claim 3: Conversion

The court dismissed the conversion claim without leave to amend. Conversion generally requires wrongful control over specific property. Saroya sought an unspecified proportional portion of tuition and fees rather than a specific, identifiable sum. The court found that this alleged obligation to repay money was not sufficiently definite or tangible to support conversion under the facts alleged.

Claim 4: Money had and received

The court dismissed the money-had-and-received claim without leave to amend. It found that Saroya alleged an enforceable contract covering the subject matter but did not allege that the contract was invalid or unenforceable. The court also found that allegations that he paid approximately $15,000 and that the university provided approximately 50 percent of the services did not establish the definite sum required for this claim. The court concluded that amendment was unwarranted.

Punitive damages

The court denied the university's request to dismiss the punitive-damages request. It reasoned that punitive damages are a remedy, not a separate claim, and therefore the request could not be dismissed through a Rule 12(b)(6) motion merely because the requested relief might not ultimately be recoverable.

Motion to strike

The university moved under Federal Rule of Civil Procedure 12(f) to strike allegations concerning its fall 2020 plans and its decision to waive certain fees. The court granted the motion as to the challenged material. It found the allegations immaterial and impertinent because the case concerned the Spring 2020 semester and alleged proportional refunds, while the fall plans involved a later period and did not address repayment of amounts already paid.

Disposition

The court granted in part and denied in part the motion to dismiss. Claim 2 was dismissed with leave to amend. Claims 3 and 4 were dismissed without leave to amend. The court denied dismissal of Claim 1 and the punitive-damages request. The motion to strike was granted. Saroya was ordered to file any amended complaint within 21 days of the order's filing date.