Hirlinger v. WP Company LLC

Background

Joseph Hirlinger and Guy Ball brought a putative class action against WP Company LLC concerning advertisements for The Washington Post’s digital subscriptions. The complaint alleged that WP Company displayed lower subscription prices next to higher prices in strikethrough type, even though it allegedly “never or almost never” sold subscriptions at the higher prices. Hirlinger and Ball each allegedly purchased an annual All-Access Digital Subscription for $40, with the advertisements displaying higher strikethrough prices of $400 and $420, respectively.

The complaint asserted claims under California’s False Advertising Law, Unfair Competition Law, and Consumers Legal Remedies Act, as well as the District of Columbia Consumer Protection Procedures Act. WP Company moved to transfer the case to the District of Columbia or, alternatively, to dismiss the complaint for failure to state a claim. The court addressed the dismissal motion and did not reach the transfer motion.

Judicial Notice

The court granted WP Company’s request for judicial notice of its Terms of Sale for Digital Products and the full checkout page shown to consumers purchasing an annual digital subscription. Judicial notice allows a court to accept certain facts or documents without requiring formal proof when their contents can be accurately and readily verified. The court found that the webpages were publicly available, easily verifiable, and directly relevant to the pricing allegations. It also found that the full checkout page supplied context for the partial screenshot reproduced in the complaint.

California Claims

The court applied Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint alleges enough facts to state a legally recognized claim. Because the claims sounded in fraud, the court also applied Rule 9(b), which requires fraud allegations to describe the circumstances of the alleged misconduct in detail.

The court explained that California consumer-protection claims based on deceptive marketing generally require allegations showing that a reasonable consumer is likely to be misled. Plaintiffs relied on a price-comparison theory, arguing that WP Company presented the strikethrough prices as former or comparable prices even though the subscriptions had allegedly not been sold at those prices.

The court rejected that theory. It found that the higher price on the checkout page clearly and unambiguously referred to the future renewal price, rather than a former price or a false comparison price. The checkout page stated that the subscription cost $40 for one year and then $120 every year thereafter, and the linked Terms of Sale explained that an introductory rate would be followed by automatic renewal at the regular rate. Because potential purchasers had to view the checkout page before buying, the court found that the pricing structure was clearly disclosed.

The court also declined to consider plaintiffs’ attempt in their opposition brief to recast the case as concerning only first-year subscriptions. It found that the complaint alleged purchases of automatically renewing All-Access Digital Subscriptions and did not distinguish between first-year and renewal subscriptions. The court stated that an opposition brief cannot amend the complaint.

The court therefore found that plaintiffs failed to state claims under the California False Advertising Law, Unfair Competition Law, and Consumers Legal Remedies Act. It granted WP Company’s motion to dismiss those claims with leave to amend.

District of Columbia Claim

The District of Columbia Consumer Protection Procedures Act prohibits unfair or deceptive trade practices, including certain misleading statements about price reductions and sale or discount prices. The court found that plaintiffs failed to identify a misleading statement for the same reason their California claims failed: the advertisement clearly referred to the future renewal price, not a false comparison price. The court dismissed the CPPA claim with leave to amend.

Disposition

The court granted WP Company’s request for judicial notice and granted its motion to dismiss. It did not reach the motion to transfer, although it stated that WP Company could renew that motion if plaintiffs demonstrated an ability to state a claim. Plaintiffs were permitted to file an amended complaint within 21 days. The court stated that no additional parties or claims could be added without leave of court or WP Company’s stipulation.