Brady v. Anker Innovations Limited

Background

Philip Brady and Duncan Smith brought a proposed class action against Anker Innovations Limited, Anker Technology Corporation, Power Mobile Life, LLC, and Fantasia Trading, LLC doing business as Anker Direct. They alleged that defendants advertised portable chargers with power-capacity ratings that substantially exceeded the chargers’ actual capacity. Brady purchased a charger advertised as having 5,200 milliampere-hours but testing showed an actual capacity of 3,285 milliampere-hours. Smith purchased a charger advertised as having 20,100 milliampere-hours but testing showed an actual capacity of 12,088 milliampere-hours.

Plaintiffs asserted claims under California’s Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law; New York’s General Business Law; other state consumer-protection laws; breach of express warranty; and unjust enrichment.

Personal jurisdiction

Plaintiffs did not oppose dismissal of Anker Innovations Limited, Anker Technology Corporation, and Power Mobile Life, LLC for lack of personal jurisdiction. The court granted that part of defendants’ motion and dismissed those three defendants from the case without prejudice.

Fantasia argued that the court lacked personal jurisdiction over it. The court denied that part of the motion. It held that Fantasia transacted business in New York through its AnkerDirect Amazon storefront and its own website, and that plaintiffs’ claims arose from those activities. The court also held that Fantasia had sufficient contacts with New York under the Constitution and that exercising jurisdiction was reasonable.

California consumer-protection claims

The court held that plaintiffs adequately identified the allegedly false statements, when and where they were made, and why they were allegedly misleading. But the complaint referred generally to “Anker,” which included all four defendants, and did not clearly identify Fantasia as the speaker of the alleged misrepresentations. Because the other three defendants had been dismissed, the court held that the complaint did not sufficiently identify the responsible defendant.

The court dismissed the California Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law claims without prejudice and granted plaintiffs leave to replead them.

New York consumer-protection claims

The court stated that claims under New York General Business Law Sections 349 and 350 are not subject to the heightened fraud-pleading requirements of Federal Rule of Civil Procedure 9(b). To the extent defendants moved to dismiss those claims under Rule 9(b), the court denied the motion.

Breach of express warranty

Defendants argued that plaintiffs’ express-warranty claims failed because plaintiffs lacked a direct contractual relationship with defendants. The court rejected that argument at the motion-to-dismiss stage. It concluded that New York law does not require such a direct relationship when an express warranty is based on misrepresentations in public advertising or sales literature. The court denied defendants’ motion to dismiss the breach-of-express-warranty claims.

Unjust enrichment

The court granted defendants’ motion to dismiss the unjust-enrichment claim. It held that the claim duplicated plaintiffs’ other claims based on the alleged misrepresentations about the chargers’ capacity. If the other claims succeeded, the unjust-enrichment claim would be duplicative; if they failed, the alleged basis for unjust enrichment would also fail.

Disposition

The court stated that defendants’ motion to dismiss was granted in part and denied in part. Plaintiffs were ordered to file a second amended complaint by February 12, 2020. The court dismissed three defendants without prejudice, dismissed the California consumer-protection claims without prejudice with leave to replead, denied dismissal of the New York consumer-protection and express-warranty claims, and granted dismissal of the unjust-enrichment claim.