Heinz v. Amazon.com, Inc.

[7] 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- [11] 12 BRIAN HEINZ, individually and on No. 2:23-cv-00282 WBS AC behalf of all others similarly 13 situated, 14 Plaintiff, MEMORANDUM AND ORDER RE: DEFENDANT’S MOTION TO 15 v. TRANSFER OR, IN THE ALTERNATIVE, MOTION TO 16 AMAZON.COM, INC. and DOES 1 DISMISS through 10, inclusive, and each 17 of them, 18 Defendants. [19] 20 ----oo0oo---- 21 Brian Heinz (“plaintiff”) brought this putative class 22 action against Amazon.com (“defendant”) seeking damages and 23 injunctive relief for violations of California Penal Code § 632 24 and California’s Unfair Competition Law, Cal. Bus. & Prof. Code 25 §§ 17200 et seq. (First Am. Compl. (Docket No. 21).) Before the 26 court is defendant’s motion to transfer the case to the Western 27 District of Washington pursuant to a forum selection clause or, 28 in the alternative, motion to dismiss the Amended Complaint. 1 (Mot. (Docket No. 24).) 2 I. Factual Background 3 Defendant operates an e-commerce website. (Mot. at 2.) 4 A customer must create an account before he or she is able to 5 make a purchase through defendant’s website. (Id. at 2.) In 6 order to create an account, a customer must affirmatively agree 7 to defendant’s Conditions of Use (the “Conditions”). (Id.) The 8 Conditions are hyperlinked1 in blue text directly below the 9 “Create your Amazon account” button.” (Id.) Customers must 10 again accept the Conditions every time they sign into their 11 account and every time they place an order. (Id. at 3.) 12 The Conditions include both a “disputes” provision and 13 an “applicable law” provision. The “disputes” provision contains 14 a forum-selection clause, which provides: “Any dispute or claim 15 relating in any way to your use of any Amazon Service will be 16 adjudicated in the state or Federal courts in King County, 17 Washington, and you consent to exclusive jurisdiction and venue 18 in these courts. We each waive any right to a jury trial.” (Id. 19 at 4.) The “applicable law” provision provides that Washington 20 law governs any dispute. (Id.) 21 Plaintiff has made numerous purchases through 22 defendant’s website. (First Am. Compl. ¶ 10.) Between 23 approximately July 2022 through September 2022, plaintiff visited 24 defendant’s website multiple times. (Id.) During some of these 25 visits, plaintiff had conversations with defendant via the chat [26] 27 1 A hyperlink is a type of text within a digital system that, when clicked on, takes the user to a specific link such as 28 a webpage or document. 1 feature on the website. (Id.) Plaintiff alleges that defendant 2 did not disclose that it was recording these conversations. (Id. 3 ¶¶ 11, 22.) Moreover, plaintiff alleges that it is defendant’s 4 practice to record all chat transcripts with customers on its 5 website. (Id. ¶ 12.) 6 II. Motion to Transfer Venue2 7 Defendant moves to transfer this case to the Western 8 District of Washington, pursuant to 28 U.S.C. § 1404 (a), and in 9 accordance with the forum selection clause contained within the 10 Conditions. (Mot. at 9.) 11 A. Legal Standard [12] 28 U.S.C. § 1404 (a) provides that “[f]or the 13 convenience of parties and witnesses, in the interest of justice, 14 a district court may transfer any civil action to any other 15 district or division where it might have been brought or to any 16 district or division to which all parties have consented.” A 17 forum-selection clause may be enforced by a motion to transfer 18 under § 1404(a). Atl. Marine Constr. Co. v. U.S. Dist. Ct. for 19 W. Dist. of Tex., 571 U.S. 49, 52 (2013). When a defendant files 20 such a motion to transfer under § 1404(a), “a district court 21 should transfer the case unless extraordinary circumstances 22 unrelated to the convenience of the parties clearly disfavor a 23 transfer.” Id. The party opposing the enforcement of a forum [24] 2 Defendant requests that the court take judicial notice [25] of four images of the Amazon.com Privacy Notice as it appeared on Amazon.com on four different dates (Exhibits G-J) and of the [26] Washington Secretary of State’s Business Information page for 27 Amazon.com (Exhibit K). The requests for judicial notice are denied because consideration of the documents is unnecessary to 28 the court’s resolution of the instant motion. 1 selection clause has the “heavy burden” of showing that it is 2 “‘unreasonable’ under the circumstances.” M/S Bremen v. Zapata 3 Off-Shore Co., 407 U.S. 1, 10, 18 (1972). 4 B. Validity of the Forum-Selection Clause 5 Forum selection clauses “are presumptively valid” and 6 “should be honored ‘absent some compelling and countervailing 7 reason.’” Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133 , 1140 8 (9th Cir. 2004) (quoting M/S Bremen, 407 U.S. at 12 ). A forum 9 selection clause controls “unless the plaintiff ma[kes] a strong 10 showing that: (1) the clause is invalid due to fraud or 11 overreaching[;] (2) enforcement would contravene a strong public 12 policy of the forum in which suit is brought, whether declared by 13 statute or by judicial decision[;] or (3) trial in the 14 contractual forum will be so gravely difficult and inconvenient 15 that the litigant will for all practical purposes be deprived of 16 his day in court.” Yei A. Sun v. Advanced China Healthcare, 17 Inc., 901 F.3d 1081, 1088 (9th Cir. 2018) (quoting M/S Bremen, [18] 407 U.S. at 18 ) (internal quotations omitted). 19 Here, plaintiff contends that the forum-selection 20 clause should not be enforced because the clause (1) is invalid 21 because plaintiff did not agree to the terms of the forum 22 selection clause and some terms are unconscionable; (2) 23 contravenes California’s public policy prohibiting pre-dispute 24 waivers of a jury trial; and (3) contravenes California’s public 25 policy protecting the right to privacy. (See generally Opp’n 26 (Docket No. 27).) The court will address each argument in turn. 27 1. Agreeing to the Conditions and Unconscionability 28 Plaintiff contends that he did not agree to defendant’s 1 Conditions because he was not required to specifically agree to 2 the Conditions, never saw the hyperlinks to the Conditions, never 3 signed a contract with Amazon, and was never provided a copy of 4 the contracts. (Opp’n at 4-5.) The court is not persuaded. 5 Multiple district courts have not only found similar Conditions 6 to be enforceable but have also found reasonable the specific 7 Conditions imposed by this defendant. See Rosskamm v. 8 Amazon.com, Inc., -- F. Supp. 3d --, 2022 WL 16534539 , at *7 9 (N.D. Ohio Oct. 28, 2022) (collecting cases). For example, in 10 Rosskamm, the district court found Amazon’s Conditions “to be 11 reasonably communicated to [p]laintiffs[] and thus enforceable” 12 “[b]ecause [d]efendant’s [Conditions] [we]re contained in 13 language directly beneath the ‘Sign-in,’ ‘Continue,’ or ‘Place 14 your order’ buttons, in blue ink indicating a hyperlink and not 15 surrounded by other language or hidden in any way . . . .” Id. 16 at *8. 17 Here, the Conditions must be accepted in order for a 18 customer to make an account, every time the customer signs into 19 the account, and every time the customer places an order. (Mot. 20 at 3-4.) The Conditions are contained in language directly below 21 the “Create your Amazon account,” “Continue,” and “Place your 22 order” buttons, and are in blue font indicating a hyperlink. 23 (Id. at 2-3.) This court agrees with the findings of other 24 district courts and concludes that the Conditions are 25 sufficiently conspicuous and thus enforceable. 26 Plaintiff also argues that the Conditions cannot be 27 enforced because they contain several unconscionable terms. (See 28 Opp’n at 15-16.) Because the court may sever any unconscionable 1 provisions, see Circuit City Stores v. Adams, 279 F.3d 899 , 895 2 (9th Cir. 2002), plaintiff must show that the forum selection 3 clause is itself unconscionable. Plaintiff appears to argue that 4 the forum selection clause is unconscionable because the 5 Conditions are a “one-sided” agreement. (See Opp’n at 16.) 6 While it is unclear whether plaintiff’s “one-sided” argument 7 refers to the issue of mutuality or adhesion, both arguments 8 fail.3 9 If plaintiff is arguing that the forum selection clause 10 is unconscionable because it lacks mutuality, the clause 11 expressly provides that both plaintiff and defendant are bound by 12 it. (See Matondo Decl. at 12 (Docket No. 24-1).) If plaintiff 13 is arguing the forum selection clause is unconscionable because 14 it is a contract of adhesion, California courts enforce forum 15 selection clauses within an adhesion contract “as long as the 16 clause provide[s] adequate notice . . . .” Intershop Commc’ns v. 17 Superior Court, 104 Cal. App. 4th 191 , 201-02 (1st Dist. 2002) 18 (quoting Hunt v. Superior Court, 81 Cal. App. 4th 901, 908 (4th 19 Dist. 2000)) (additional citation omitted). The forum selection 20 clause here expressly states that King County, Washington is the 21 selected forum. See Intershop Commc’ns, 104 Cal. App. 4th at 202 22 3 As explained by cases in the arbitration context upon which plaintiff relies, under California law, contractual clauses 23 are unenforceable if they are both procedurally and substantively unconscionable. See Armendariz v. Found. Health Psychcare 24 Servs., 24 Cal. 4th 83, 114 (2000); Pokorny v. Quixtar, Inc., 601 F.3d 987, 996 (9th Cir. 2010). A contract may be procedurally 25 unconscionable where it is one of adhesion. OTO, LLC v. Kho, 8 Cal.5th 111, 126 (2019); see also Davis v. Kozak, 53 Cal. App. 26 5th 897, 907 (2020) (“[A]dhesion establishes only a ‘low’ degree of procedural unconscionability”). A contract may be 27 substantively unconscionable where it lacks mutuality. See Pokorny, 601 F.3d at 997 -98 (citing Abramson v. Juniper Networks, 28 Inc., 115 Cal. App. 4th (6th Dist. 2004)). 1 (finding plaintiff had notice where the forum selection clause 2 “plainly” stated Hamburg, Germany as the selected forum).4 The 3 court therefore declines to find the forum selection clause 4 unconscionable. 5 2. Pre-Dispute Jury Trial Waiver 6 Next, plaintiff argues that the forum selection clause 7 should not be enforced because its pre-dispute jury trial waiver 8 contravenes California public policy. (Opp’n at 12.) As 9 discussed above, a forum selection clause will not be enforced 10 where “enforcement would contravene a strong public policy of the 11 forum in which suit is brought . . . .” Yei A. Sun, 901 F.3d at 12 1088. The party opposing transfer has the “heavy burden” of 13 showing that transfer is “‘unreasonable’ under the 14 circumstances.” M/S Bremen, 407 U.S. at 10, 18 . 15 In the Ninth Circuit, “federal courts sitting in 16 diversity must apply the relevant state law to evaluate the 17 validity of a pre-dispute jury trial waiver when that law is more 18 protective than federal law.” In re Cnty of Orange, 784 F.3d 19 520, 531-32 (9th Cir. 2015). Under federal law, pre-dispute jury 20 trial waivers are permitted “as long as each party waived its 21 rights knowingly and voluntarily.” Id. at 523. By contrast, 22 under California law, “pre-dispute jury trial waivers are invalid 23 unless expressly authorized by statute.” Id. (citing Grafton [24] 4 Plaintiff explains that forum selection clause is [25] buried toward the end of “nearly ten single-space pages.” (Opp’n at 15.) While this may be the case, the length of the Conditions [26] does not on its own establish that plaintiff lacked notice. Cf. 27 Hunt, 81 Cal. App. 4th at 908 (no notice where forum selection clause only provided “the applicable jurisdiction” and did not 28 identify California as the applicable jurisdiction). 1 Partners v. Superior Court, 36 Cal. 4th 479 (2005)); see also 2 Handoush v. Lease Fin. Grp., LLC, 41 Cal. App. 5th 729 , 734-35 3 (1st Dist. 2019) (explaining that California courts refuse to 4 enforce forum selection clauses which contain pre-dispute jury 5 trial waivers as contrary to California’s fundamental public 6 policy protecting the right to a jury trial). Thus, because 7 California law is more protective than federal law, the court 8 must apply California law. See In re Cnty of Orange, 784 F.3d at 9 531-32. 10 Where a forum selection clause contains a pre-dispute 11 jury trial waiver, the defendant seeking transfer bears the 12 burden of showing that litigation in the transferee court would 13 not diminish the plaintiff’s rights under California law. 14 Handoush, 41 Cal. App. 5th at 737-49 (finding a forum selection 15 clause not enforceable because, unlike California, the state of 16 the transferee court did not prohibit pre-dispute jury trial 17 waivers). Here, plaintiff argues that Washington law does not 18 provide the same protection as California law against predispute 19 jury trial waivers and, therefore, the forum selection clause is 20 invalid. (Opp’n at 12 n. 4.) 21 While it may be true that Washington law does not 22 provide the same protection as California’s regarding pre-dispute 23 jury trial waivers, defendant has stipulated to preserve 24 plaintiff’s jury trial rights under California law in the Western 25 District of Washington. (Reply at 10.) Courts permit transfer 26 where a defendant stipulates that a plaintiff’s unwaivable rights 27 under the law of the transferor court will apply in the 28 transferee court. See, e.g., Pinkevich v. Thor Motor Coach, 1 Inc., No. 2:22-cv-05985 ODW, 2022 WL 19333282 , at *3 (C.D. Cal. 2 Nov. 16, 2022) (permitting transfer where defendant stipulated 3 that plaintiff’s jury trial rights under California law would not 4 be disturbed); see id. (collecting cases). Because defendant has 5 stipulated to preserve plaintiff’s jury trial rights, the court 6 finds that plaintiff’s jury trial rights under California law 7 will not be diminished upon transfer to the Western District of 8 Washington. 9 3. Protecting the Right to Privacy 10 Finally, plaintiff argues that the forum selection 11 clause should not be enforced because it contravenes California’s 12 policy of protecting the right to privacy because the clause’s 13 choice-of-law provision mandates the application of Washington 14 law. (Opp’n at 12.) 15 To demonstrate that a forum selection clause would 16 contravene a strong public policy, the plaintiff must “point to a 17 statute or judicial decision that clearly states such a strong 18 policy.” Yei A. Sun, 901 F.3d at 1090 (citation omitted). Here 19 plaintiff cites Kearney v. Salomon Smith Barney, Inc., 39 Cal. 20 4th 95 (2006), for the proposition that the right to privacy is a 21 fundamental state policy. In Kearney, the California Supreme 22 Court explained: “California’s explicit constitutional privacy 23 provision (Cal. Const., art. I, § 1)5 was enacted in part 24 specifically to protect Californians from overly intrusive [26] 5 Cal. Const., art. I, § 1 states: “All people are by nature free and independent and have inalienable rights. Among 27 these are enjoying and defending life and liberty, acquiring, possessing, and protecting property, and pursuing and obtaining 28 safety, happiness, and privacy.” 1 business practices that were seen to pose a significant and 2 increasing threat to personal privacy.” Id. at 125 (citing 3 Rattray v. City of Nat’l City, 51 F.3d 793, 797 (9th Cir. 1994) 4 (“Having one’s personal conversations secretly recorded may well 5 infringe upon the right to privacy guaranteed by the California 6 Constitution.”)) (additional citations omitted). 7 Washington law similarly reflects a strong public 8 policy of protecting the right to privacy. For example, both 9 California and Washington make unlawful any recording of private 10 communications without consent. California Penal Code § 632, 11 under which plaintiff asserts his first cause of action, 12 provides: “A person who, intentionally and without the consent of 13 all parties to a confidential communication, uses an electronic 14 amplifying or recording device to eavesdrop upon or record the 15 confidential communication . . . shall be punished . . . .” Cal. 16 Penal Code § 632(a) (emphasis added). Similarly, Washington Code 17 § 9.73.030 makes it unlawful to record any “[p]rivate 18 communication . . . by any device electronic or otherwise 19 designed to record . . . without first obtaining the consent of 20 all the participants in the communication . . . .” Wash. Rev. 21 Code § 9.73.030(1)(a) (emphasis added). 22 Plaintiff argues that enforcing the forum selection 23 clause will deny plaintiff his day in court because Washington 24 law requires the showing of actual damages. Compare Wash. Rev. 25 Code § 9.73.060 (“injured his or her business, his or her person, 26 or his or her reputation”),6 with Cal. Penal Code § 637.2 (c) (“It [27] 6 See e.g., McKee v. Gen. Motors Co., 601 F. Supp. 3d 28 901, 908 (W.D. Wash. 2022) (“[A] violation of the [Washington 1 is not a necessary prerequisite to an action pursuant to this 2 section that the plaintiff has suffered, or be threatened with, 3 actual damages”).7 4 However, “the fact that certain types of remedies are 5 unavailable in the [transferee] forum does not change the 6 calculus if there exists a basically fair court system in that 7 forum that would allow the plaintiff to seek some relief.” Yei 8 A. Sun, 901 F.3d at 1092-93 (finding the forum selection clause 9 enforceable where plaintiffs maintained the opportunity to seek 10 relief in transferee court) (citation, quotations, and emphasis 11 omitted); see id. at 1092 (“It is the availability of a remedy 12 that matters, not predictions of the likelihood of a win on the 13 merits.”) (quoting Weber v. PACT XPP Techs., AG, 811 F.3d 758 , 14 774 (5th Cir. 2016) (quotations and emphasis omitted)). Although 15 available remedies under Washington law are more limited than 16 those available under California law, Washington law does not 17 make all remedies unavailable. Moreover, there is no suggestion 18 that courts in the state of Washington (either federal or state) 19 are not “basically fair.” Thus, plaintiff’s potential inability 20 to obtain relief under Washington law does not establish that 21 Washington law contravenes California’s public policy. 22 For the reasons discussed above, the court finds that [23] 24 Privacy Act] without injury is insufficient to maintain a civil action.”). [7] Cal. Penal Code § 637.2 (a) permits anyone injured by a violation to bring an action for $5,000 per violation or three 27 times the amount of actual damages sustained. By contrast, Wash. Rev. Code § 9.73.060 permits an injured person to recover actual 28 damages or liquidated damages. 1 the exceptions to the enforcement of a forum-selection clause do 2 not apply. Accordingly, the court finds that the forum-selection 3 clause is valid and enforceable. 4 C. Transfer Under § 1404(a) 5 In deciding a § 1404(a) motion to transfer pursuant to 6 a forum-selection clause, “a district court may consider 7 arguments about public-interest factors only.”8 Atl. Marine, 571 8 U.S. at 64. Public interest factors may include: “(1) local 9 interest of lawsuit; (2) the court’s familiarity with governing 10 law; (3) burden on local courts and juries; (4) congestion in the 11 court; and (5) the costs of resolving a dispute unrelated to this 12 forum.” Lueck v. Sundstrand Corp., 236 F.3d 1137, 1147 (9th Cir. 13 2001) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235 , 259-61 14 (1981)); see also Atl. Marine, 571 U.S. at 62 n.6 (citation and 15 internal quotations omitted). “Because [public interest] factors 16 will rarely defeat a motion, the practical result is that forum17 selection clauses should control except in unusual cases.” Atl. 18 Marine, 571 U.S. at 64 . 19 Here, plaintiff argues that California’s interest in 20 the lawsuit and familiarity with governing law warrants denying 21 transfer under § 1404(a). (Opp’n at 14-15.) The court 22 disagrees. The forum selection clause here mandates application 23 of Washington law. Thus, the Western District of Washington 24 would be more familiar with the governing law. See L.D. Reeder 25 8 Where there is a valid forum selection clause, district courts adjust their § 1404(a) analysis in three ways: (1) the 26 court should not consider plaintiff’s choice of forum; (2) the court should not consider arguments about the parties’ private 27 interests; and (3) the original venue’s choice-of-law rules will not apply, thus potentially affecting the public interest 28 considerations. Atl. Marine, 571 U.S. at 63-64 . 1 Contractors of Ariz. v. Higgins Indus., Inc., 265 F.2d 768 , 775 2 (9th Cir. 1959) (“There is an appropriateness . . . in having the 3 trial in a forum that is at home with the state law that must 4 govern the case . . . .”) (citation omitted). 5 Further, while California may have an interest in the 6 lawsuit given the proposed class is comprised exclusively of 7 California residents, it would run counter to “the strong federal 8 policy in favor of enforcing forum-selection clauses,” see Yei A. 9 Sun, 901 F.3d at 1090 , if a plaintiff could avoid application of 10 a forum selection clause by how he or she decides to define a 11 proposed class. Plaintiff has therefore not shown that either 12 public interest factor “overwhelmingly disfavor[s] a transfer.” 13 See Atl. Marine, 571 U.S. at 67 . Plaintiff agreed to litigate 14 disputes in Washington and “courts should not unnecessarily 15 disrupt the parties’ settled expectations.” Atl. Marine, 571 16 U.S. at 66. 17 For the reasons discussed above, plaintiff has not met 18 the “heavy burden” of showing that transfer is “‘unreasonable’ 19 under the circumstances.” M/S Bremen, 407 U.S. at 10, 18 . 20 Accordingly, the court must grant defendant’s motion to transfer. 21 Because the case will be transferred to the Western District of 22 Washington, the court declines to address defendant’s motion to 23 dismiss. 24 IT THEREFORE ORDERED that defendant’s motion to 25 transfer (Docket No. 24) be, and the same hereby is, GRANTED. 26 This action is hereby TRANSFERRED to the United States District 27 /// 28 /// een II IIE III III IE EEE OIE IIR ISIN IIIS IIE EUS (ISIS 1 Court for the Western District of Washington. [2] 3 | pated: July 11, 2023 tleom ah. A. be—~ WILLIAMB.SHUBB ©. UNITED STATES DISTRICT JUDGE