Bryan v. Apple Inc.

Background

Christopher Bryan and Heriberto Valiente brought a proposed nationwide class action against Apple Inc. They alleged that the iPad Mini 6 has a liquid crystal display problem known as “jelly scrolling,” which they said bends, warps, blurs, and obscures text and images. According to the amended complaint, the problem resulted from the placement of a controller board within the device. The plaintiffs alleged that Apple knew about the issue but continued selling the product without proper disclosures.

The plaintiffs asserted claims under California’s Advertising Law, Colorado’s Consumer Protection Act, and Florida’s Deceptive and Unfair Trade Practices Act. They also asserted claims for fraud, fraudulent omission or concealment, fraudulent inducement, negligent misrepresentation, and unjust enrichment. They sought damages, restitution, and an injunction preventing Apple from continuing the allegedly deceptive practices.

Issues and analysis

Apple moved to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not adequately state a legally recognized claim. Apple argued, among other things, that the plaintiffs could not pursue California claims because neither was a California resident, that they lacked standing to seek an injunction, that the Colorado statute did not permit the requested relief, and that their fraud-based claims did not identify an actionable misrepresentation or omission.

The court rejected Apple’s argument concerning the plaintiffs’ non-California residency at this stage. It explained that nonresidents may invoke California statutory remedies for wrongful conduct occurring in California and noted the plaintiffs’ allegations that Apple’s product-design and advertising decisions were developed in and coordinated from its headquarters in Cupertino, California. The court also concluded that questions concerning the plaintiffs’ ability to assert other states’ claims were better addressed later, including in connection with class certification or choice-of-law analysis.

The court rejected Apple’s challenge to the plaintiffs’ standing to seek an injunction. The plaintiffs alleged that they remained interested in purchasing Apple products in the future but could not rely on Apple’s labeling or marketing unless the products were properly labeled. Viewing those allegations in the plaintiffs’ favor, the court found them sufficient to allege a risk of future harm.

The court also rejected Apple’s argument that the Colorado Consumer Protection Act barred the plaintiffs from seeking damages and injunctive relief in a class action. The court relied on the statute’s language stating that a successful plaintiff in a certified class action may recover actual damages, legally allowed injunctive relief, and reasonable attorney fees and costs.

The court did grant Apple’s motion on a narrow point concerning equitable restitution and unjust enrichment. The plaintiffs had not alleged that they lacked an adequate remedy at law, and they did not explain how their damages and equitable-relief claims were based on different theories. The court stated that amendment might not be futile and therefore allowed the plaintiffs to file an amended complaint within 21 days.

As to the fraud-based claims, Apple argued that “jelly scrolling” was simply a normal feature of liquid crystal displays, did not impair the product, and had been publicly addressed by Apple. The court said that resolving the ultimate truth or falsity of those factual disputes was not appropriate on a motion to dismiss. It found the plaintiffs’ allegations sufficient because they alleged that the defect materially impaired the iPad’s principal uses, that Apple had exclusive or superior knowledge of the issue, and that the plaintiffs relied on product labeling, packaging, and marketing that did not disclose the alleged defect.

Disposition

The court GRANTED IN PART and DENIED IN PART Apple’s motion to dismiss. It GRANTED the motion as to the plaintiffs’ claims for restitution and unjust enrichment and otherwise DENIED the motion in its entirety. The court did not specify that those claims were dismissed with or without prejudice; it stated only that the plaintiffs could amend the complaint within 21 days. The court separately DENIED as moot Apple’s motion to stay discovery.