(PS) Van den Heuvel v. Expedia Travel et al, No. 2:2016cv00567 - Document 48 (E.D. Cal. 2017)

Court Description: FINDINGS and RECOMMENDATIONS signed by Magistrate Judge Allison Claire on 6/1/2017 RECOMMENDING that Defendant's 36 motion to dismiss be denied. Motion referred to Judge John A. Mendez. Objections to F&R due within 21 days. (Zignago, K.)
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(PS) Van den Heuvel v. Expedia Travel et al Doc. 48 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 JEAN MARC VAN DEN HEUVEL, 12 13 14 No. 2:16-cv-00567-JAM-AC Plaintiff, v. FINDINGS AND RECOMMENDATIONS EXPEDIA TRAVEL, et al., 15 Defendants. 16 17 This matter comes before the Court on Defendant Expedia Inc.’s Motion to Dismiss 18 Plaintiff’s Second Amended Complaint. ECF No. 36. Plaintiff is proceeding in pro se, and the 19 matter was accordingly referred to the magistrate judge by E.D. Cal. R. (“Local Rule”) 20 302(c)(21). I. BACKGROUND 21 22 A. Relevant Procedural History 23 This lawsuit was removed from the Sacramento County Superior Court by former 24 defendant British Airways on March 18, 2016. See ECF No. 1. British Airways moved to 25 dismiss plaintiff Jean Marc Van Den Heuvel’s pro se complaint, and the motion was granted by 26 the undersigned with leave to amend. ECF No. 15. Plaintiff filed a First Amended Complaint on 27 May 31, 2016. ECF No. 18. British Airways moved to dismiss the First Amended Complaint, 28 and the undersigned granted the motion with leave to amend. ECF No. 19 and 25. On August 5, 1 Dockets.Justia.com 1 2016, plaintiff filed a Second Amended Complaint. ECF No. 26. On August 25, 2016, plaintiff 2 and British Airways filed a stipulated motion for dismissal of British Airways as a defendant. 3 ECF No. 30. The motion was granted, leaving Expedia Inc. (“Expedia”) as the only remaining 4 defendant in this case. ECF No. 31. 5 On September 1, 2016, the undersigned issued an Order to Show Cause to plaintiff, noting 6 that plaintiff did not appear to be prosecuting his case against Expedia, Inc. and that the Court had 7 not received any proof that Expedia had been served. ECF No. 33, 1. The Court received a Proof 8 of Service form from plaintiff indicating that a process server mailed a “Copy of Summons and 9 Complaint to Expedia Travel as follows [:] Corporate Secretary, 333 108th Ave. N.E. Bellevue, 10 WA 98004.” ECF 35, 1. Defendant Expedia filed its Motion to Dismiss on October 13, 2016. 11 ECF No. 36. Noting that Plaintiff had filed proof of service on Expedia, the undersigned 12 discharged its Order to Show Cause and set a hearing date for defendant’s Motion to Dismiss. 13 ECF No. 39. The hearing was held on December 14, 2016, and the fully briefed Motion to 14 Dismiss is now before the Court. ECF No. 43. 15 B. 16 Expedia moves to dismiss Plaintiff’s Second Amended Complaint for (1) untimely and The Claims 17 insufficient service of process pursuant to Federal Rule of Civil Procedure 12(b)(5), and (2) 18 failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil 19 Procedure 12(b)(6). 20 II. ANALYSIS 21 A. 22 As the court explains below, plaintiff has insufficiently served defendant but has made an Motion to Dismiss for Insufficient Service of Process 23 adequate showing of cause for the failure to perfect service. In light of that showing, and 24 considering the actual notice and lack of prejudice to defendant, the undersigned recommends 25 denial of defendant’s motion to dismiss for insufficient service. 26 “Under the Federal Rule of Civil Procedure 12(b)(5), a defendant may challenge any 27 departure from the proper procedure for serving the summons and complaint as “insufficient 28 service of process.” Fed.R.Civ.P. 12(b)(5). Once a defendant challenges service of process, the 2 1 plaintiff has the burden of establishing the validity of service of process under Rule 4.” Schauf v. 2 Am. Airlines, No. 1:15-CV-01172-SKO, 2015 WL 5647343, at *4 (E.D. Cal. Sept. 24, 2015). 3 “As a general principle, ‘Rule 4 is a flexible rule that should be liberally construed,’ 4 Borzeka v. Heckler, 739 F.2d 444, 447 (9th Cir.1984), and ‘substantial compliance with the 5 service requirements of Rule 4 is sufficient so long as the opposing party receives sufficient 6 notice.’ Daly–Murphy v. Winston, 837 F.2d 348, 355 n. 4 (9th Cir.1987).” Id. In the Ninth 7 Circuit, failure to comply with Rule 4’s “personal service requirement does not require dismissal 8 of the complaint if (a) the party that had to be served personally received actual notice, (b) the 9 defendant would suffer no prejudice from the defect in service, (c) there is a justifiable excuse for 10 the failure to serve properly, and (d) the plaintiff would be severely prejudiced if his complaint 11 were dismissed.” Borzeka, 739 F.2d at 447. 12 Plaintiff filed a proof of service on September 20, 2016, indicating that a registered 13 process server “Mailed Copy of Summons and Complaint to Expedia Travel” directed to the 14 company’s Corporate Secretary. ECF No. 35. Defendant correctly argues that service by 15 certified mail does not meet the requirements of Rule 4(h)(1). Schauf, 2015 WL 5647343 at *4. 16 However, plaintiff attempted in good faith to properly effectuate service by retaining a process 17 server, and further asserts that he is a “handicapped, stroke survivor” with limited capacity. ECF 18 No. 40, 2. The undersigned finds that plaintiff has demonstrated good cause for failure to meet 19 the technical requirements of Fed. R. Civ. P. 4(h)(1). For these same reasons, plaintiff would be 20 severely prejudiced were his Second Amended Complaint dismissed for failure to meet the 21 technical requirements of Rule 4(h)(1). Further, Expedia has received actual notice of plaintiff’s 22 suit, and has not presented any argument that it has been or will be prejudiced by plaintiff’s 23 failure to effectuate personal service as opposed to service by mail. ECF. No. 36-1. Defendant is 24 fully aware of the existence of this suit and the operative Second Amended Complaint. The 25 undersigned therefore recommends that Defendant’s motion to dismiss for insufficient service be 26 DENIED. 27 //// 28 //// 3 1 B. 2 Defendant’s Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6) should be denied. Motion to Dismiss for Failure to State a Claim 3 Plaintiff’s Second Amended Complaint, construed liberally with inferences drawn in favor of the 4 pro se plaintiff and considering attached documents, states claims for breach of contract and 5 fraud. 6 7 a. Legal Standard for 12(b)(6) Motion to Dismiss “To survive a motion to dismiss, a complaint must contain sufficient factual matter, 8 accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 9 U.S. 662, 129 S.Ct. 1937, 1949 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 10 (2007)). In a plausible claim, “the plaintiff pleads factual content that allows the court to draw 11 the reasonable inference that the defendant is liable for the conduct alleged.” Iqbal, 129 S.Ct. at 12 1949 (citing Twombly, 550 U.S. at 545); see also Moss v. United States Secret Serv., 572 F.3d 13 962, 969 (9th Cir.2009) (“In sum, for a complaint to survive a motion to dismiss, the non- 14 conclusory ‘factual content,’ and reasonable inferences from that content, must be plausibly 15 suggestive of a claim entitling the plaintiff to relief.”) (citing Iqbal at 1949). The Court must 16 accept plaintiffs’ factual allegations as true, but is not required to accept plaintiff’s legal 17 conclusions as true. Id. at 1949–150. Courts are not required to accept as true legal conclusions 18 that are framed as factual allegations. Iqbal, at 1950 (citation omitted). Complaints by plaintiffs 19 proceeding pro se are construed liberally when being evaluated under Iqbal, with the plaintiff 20 afforded the benefit of any doubt. Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010). 21 In general, courts may not consider documents outside the pleadings when ruling on a 22 motion made under Fed. R. Civ. P. 12(b)(6) without converting the motion to a summary 23 judgment under Fed. R. Civ. P. 56, and giving the non-moving party an opportunity to respond. 24 United States v. Ritchie, 342 F.3d 903, 907–08 (9th Cir. 2003). “A court may, however, consider 25 certain materials—documents attached to the complaint, documents incorporated by reference in 26 the complaint, or matters of judicial notice—without converting the motion to dismiss into a 27 motion for summary judgment.” Id. Where the documents are physically attached to the 28 complaint, undisputed authenticity is not required for consideration. See, Lee v. City of Los 4 1 Angeles, 250 F.3d 668, 688 (9th Cir. 2001). 2 b. Breach of Contract 3 Liberally construing the allegations, drawing all inferences in favor of the pro se plaintiff, 4 and considering the attached documents, the undersigned concludes that the Second Amended 5 Complaint states a claim for breach of contract. The elements for breach of contract are: (1) the 6 existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) 7 defendant’s breach, and (4) the resulting damages to the plaintiff. Oasis W. Realty, LLC v. 8 Goldman, 51 Cal. 4th 811, 821 (2011) (citing Reichert v. General Ins. Co., 68 Cal. 2d 822, 830 9 (1968)). Plaintiff alleges that Expedia, which he refers to as a “Travel Agency” (ECF No. 26, 2), 10 “knowingly sold [him] a travel ticket” and “affirmed there would be a full refund of [the] airline 11 ticket with proof of a doctors M.D. note or statement[.]” ECF No. 26, 4. The undersigned reads 12 this as alleging the existence of a contract, and alleging Plaintiff’s performance by purchase of the 13 ticket. Plaintiff also attaches what appears to be a bank statement from October 14, 2015 14 showing a purchase from Expedia in the amount of $1,257.88. Id. at 8. 15 The undersigned construes Plaintiff’s allegations that Expedia “is in the business of 16 defrauding society of the costs of airline tickets [regardless] of promise to do so” as alleging that 17 Expedia breached its contract with Plaintiff to provide a full refund of the airline ticket when 18 presented with a doctor’s note. Id. at 4. With respect to damages, the undersigned considers the 19 e-mail to “travel@customercare.expedia.com,” allegedly from plaintiff, attached to the Second 20 Amended Complaint. This document states: “The amount to return is $1,200.00 and some 21 change. I need this money as soon as possible you have caused injury from the hardship of 22 unexpected trauma caused by actions I was not made aware of.” Id. at 21. The undersigned also 23 considers plaintiff’s attached letter to British Airways, which alleges “I am on social security and 24 need my money back . . . I desperately need my money to be able to afford the basic [amenities] 25 of life.” Id. at 9. Because the pro se plaintiff has alleged all elements of a breach of contract 26 claim, the undersigned recommends that Expedia’s motion to dismiss this claim be DENIED. 27 //// 28 //// 5 1 2 c. Fraud Liberally construing the allegations, drawing all inferences in favor of the pro se plaintiff, 3 and considering the attached documents, the undersigned concludes that the Second Amended 4 Complaint successfully alleges all elements of a fraud claim. “Under California law, the 5 indispensable elements of a fraud claim include a false representation, knowledge of its falsity, 6 intent to defraud, justifiable reliance, and damages.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 7 1097, 1105 (9th Cir. 2003) (internal quotation marks omitted). Where, as here, a fraud claim 8 would be tried in federal court, it must “state with particularity the circumstances constituting 9 fraud or mistake.” Fed. R. Civ. P. 9(b). 10 Plaintiff alleges that Expedia “affirmed there would be a full refund of [his] airline ticket 11 with proof of a doctors M.D. note” and “knew the flight scheduled was to possibly be cancelled 12 due to hardship of medical problem.” ECF No. 26, 4. As discussed above, plaintiff alleges that 13 Expedia did not refund the ticket upon receiving a doctor’s note. Plaintiff alleges knowledge of 14 falsity and intent to defraud by asserting that Expedia “is in the business of defrauding society the 15 costs of airline tickets, regardless of promise to do so.” Id. Plaintiff alleges justifiable reliance by 16 demonstrating his purchase with his bank statement (ECF No. 26, 8) and stating that defendant 17 used “promotional lures” on him. Id. at 4. As discussed above in the Breach of Contract section, 18 plaintiff has sufficiently alleged damages. Because the pro se plaintiff has pled the elements of a 19 fraud claim, the undersigned recommends that Expedia’s motion to dismiss this claim be 20 DENIED. 21 22 23 24 III. CONCLUSION The undersigned recommends that Defendant’s motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), or in the alternative pursuant to Fed. R. Civ. P. 12(b)(5), be DENIED. These findings and recommendations are submitted to the United States District Judge 25 assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(1). Within twenty one days 26 after being served with these findings and recommendations, any party may file written 27 objections with the court and serve a copy on all parties. Id.; see also Local Rule 304(b). Such a 28 document should be captioned “Objections to Magistrate Judge’s Findings and 6 1 Recommendations.” Any response to the objections shall be filed with the court and served on all 2 parties within fourteen days after service of the objections. Local Rule 304(d). Failure to file 3 objections within the specified time may waive the right to appeal the District Court’s order. 4 Turner v. Duncan, 158 F.3d 449, 455 (9th Cir. 1998); Martinez v. Ylst, 951 F.2d 1153, 1156-57 5 (9th Cir. 1991). 6 DATED: June 1, 2017 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7