Heck v. Amazon.com, Inc.

Background

Julia Heck alleged that Amazon offered Amazon Prime customers free digital credits for agreeing to delayed delivery through the No-Rush Shipping Program. According to Heck, Amazon used that agreement to enroll her in an Audible free trial, transferred her stored credit-card information to Audible, and allowed Audible to charge a monthly subscription fee after the trial ended. She alleged that Audible charged her $14.95 per month, totaling $59.80, until she discovered and canceled the subscription.

Heck asserted claims under California’s Consumer Legal Remedies Act (CLRA) and Unfair Competition Law (UCL). The defendants who filed the motion were Amazon.com, Inc. and Audible, Inc.

CLRA Notice Requirement

The court held that Heck’s CLRA claim for damages was procedurally defective because she did not give the required pre-suit notice. California law requires a plaintiff seeking CLRA damages to notify the defendant at least 30 days before filing suit and demand correction or other relief for the alleged violation.

Heck’s March 11, 2022 letter to Amazon described a different theory—that Audible was marketed, labeled, and advertised as free with an Amazon Prime subscription—than the theory in her amended complaint, which concerned enrollment through the No-Rush Shipping Program and the resulting charges. The court also ruled that notice to Amazon did not satisfy the requirement for Audible merely because Audible was Amazon’s wholly owned subsidiary and shared counsel. Heck’s October 5, 2022 letter to Audible described the different marketing theory and was sent two months after she filed the amended complaint. The court granted dismissal of the CLRA damages claim for failure to meet the notice requirement, while allowing amendment to correct the notice deficiencies. The notice requirement did not apply to Heck’s request for injunctive relief.

Insufficient Allegations of Misrepresentation or Omission

The court concluded that Heck’s CLRA and UCL theories sounded in fraud and therefore had to meet Rule 9(b)’s heightened pleading requirement. That rule requires specific facts about who made the statements, what was said or omitted, when and where it occurred, and how the conduct was misleading.

The court found that the amended complaint did not explain Audible’s role, identify the alleged statements, provide when or where Heck saw them, or plausibly connect the No-Rush Shipping Program to Audible enrollment. It also did not allege that the promised digital credits were not provided or did not work as promised. The court therefore found that Heck had not adequately alleged that the offer itself was false or misleading, or explained how accepting delayed delivery led to Audible enrollment.

The court also rejected the omission theory. Heck had not pleaded with particularity what partial representations the defendants made, what information they omitted, or how the No-Rush Shipping Program led her to believe that Audible would be free. The court stated that calling the scheme “surreptitious” was not enough without specific facts explaining the enrollment process.

UCL Claims

The court ruled that the UCL claim under the “unfair” prong failed because it was based on the same conduct as the unsuccessful fraud-based theory. The UCL claim under the “unlawful” prong also failed to the extent it relied on alleged CLRA violations.

Heck separately based the unlawful-prong claim on California’s Automatic Renewal Law (ARL), which requires clear and conspicuous disclosure of automatic-renewal terms, consumer consent, and an easy cancellation method. The court found that Heck had not alleged what disclosures she saw concerning the No-Rush Shipping Program or Audible enrollment. Without those allegations, the court could not evaluate whether the disclosures violated the ARL, so that part of the UCL claim also failed.

Disposition

The court granted the defendants’ motion to dismiss with leave to amend. It did not reach the defendants’ remaining challenges. Heck could file an amended complaint within 45 days. The court also ordered the parties to appear for an initial case-management conference on March 10, 2023, and to file a joint case-management statement by March 3, 2023.