Bugarin v. All Nippon Airways Co., Ltd., No. 5:2020cv03341 - Document 31 (N.D. Cal. 2021)

Court Description: ORDER GRANTING IN PART AND DENYING IN PART 18 MOTION TO DISMISS, WITH LEAVE TO AMEND IN PART AND WITHOUT LEAVE TO AMEND IN PART. Amended Pleading due by 2/9/2021. Signed by Judge Beth Labson Freeman on 1/19/2021. (blflc1S, COURT STAFF) (Filed on 1/19/2021)

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Bugarin v. All Nippon Airways Co., Ltd. Doc. 31 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 1 of 23 1 2 3 4 5 UNITED STATES DISTRICT COURT 6 NORTHERN DISTRICT OF CALIFORNIA 7 SAN JOSE DIVISION 8 9 ASHLEY BUGARIN, Plaintiff, 10 United States District Court Northern District of California 11 12 13 Case No. 20-cv-03341-BLF v. ALL NIPPON AIRWAYS CO., LTD., Defendant. ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS, WITH LEAVE TO AMEND IN PART AND WITHOUT LEAVE TO AMEND IN PART [Re: ECF 18] 14 15 16 17 In this putative nationwide class action, Plaintiff Ashley Bugarin (“Bugarin”) claims that 18 Defendant All Nippon Airways Co., Ltd. (“ANA”) breached its Conditions of Carriage by failing 19 to issue refunds to thousands of passengers whose flights were cancelled as a result of the 20 COVID-19 pandemic. Bugarin asserts two state law claims on behalf of herself and the putative 21 class, one for breach of contract and the other for rescission. ANA moves to dismiss those claims 22 under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, under Rule 23 12(b)(2) for lack of personal jurisdiction, and under Rule 12(b)(6) for failure to state a claim upon 24 which relief may be granted. 25 ANA’s motion is DENIED to the extent it is brought under Rules 12(b)(1) and 12(b)(2), 26 and GRANTED to the extent it is brought under Rule 12(b)(6). Leave to amend is GRANTED on 27 the contract claim and DENIED on the rescission claim. 28 Dockets.Justia.com Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 2 of 23 I. 1 Bugarin, who resides in San Jose, California, purchased a round-trip flight to Japan on 2 3 ANA. FAC ¶¶ 809, 19, ECF 15. The outbound flight was from San Jose, California to Tokyo, 4 Japan, while the return flight was from Tokyo, Japan to San Francisco, California. FAC ¶¶ 8, 19. 5 Bugarin made the purchase through a third party, Asaptickets.com (“ASAP”). FAC ¶ 9; Ito Decl. 6 ¶ 19, ECF 18-1. ASAP is not an authorized ticket agent of ANA and does not have a contractual 7 relationship with ANA. Ito Decl. ¶ 11. However, pursuant to industry practice, an unauthorized 8 ticket agent such as ASAP may sell ANA tickets through an authorized ticket agent. Ito Decl. ¶ 9 19. In this case, ASAP sold Bugarin the ANA ticket through an authorized ticket agent, 10 Downtown Travel, which is based in New York. Ito Decl. ¶¶ 17-19. Bugarin’s departing flight from San Jose, California to Tokyo, Japan operated as scheduled 11 United States District Court Northern District of California BACKGROUND1 12 on March 23, 2020, but Bugarin was not on the flight. Ito Decl. ¶ 24. Bugarin’s return flight was 13 cancelled due to the COVID-19 pandemic. FAC ¶ 19. Bugarin “attempted to request a cash 14 refund from All Nippon by calling All Nippon.” Id. She “called All Nippon several times and 15 was on the phone for several hours each time, but she was never able to reach a representative of 16 All Nippon.” Id. Bugarin never spoke to an ANA representative and she was not refunded for the 17 cancelled return flight. Id. Bugarin claims that ANA’s failure to issue her a refund breached the applicable Conditions 18 19 of Carriage (“COC”),2 attached as Exhibit A to the FAC. FAC ¶¶ 38-44 & Exh. A, ECF 15. 20 Section 13 of the COC, “Refunds,” states that ANA will provide a refund when a passenger is 21 prevented from using his or her ticket as a result of ANA’s cancellation of a flight. COC § 13(A), 22 (C). Section 13 specifies that “ANA will make a refund to the person named in a Ticket or, to the 23 person who purchased the Ticket upon presentation to ANA of satisfactory evidence to prove that 24 he/she is entitled by these Conditions of Carriage to such refund.” COC § 13(B). 25 26 27 28 1 The background facts are drawn from the FAC and from evidence submitted by the parties, which as discussed in Section II below may be considered in connection with the motions under Rules 12(b)(1) and 12(b)(2). Bugarin refers to this document alternately as the “Conditions of Carriage” and the “Contract of Carriage.” See, e.g., FAC ¶ 13, ECF 15; Opp. at 1, ECF 25. 2 2 United States District Court Northern District of California Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 3 of 23 1 The FAC does not allege that Bugarin presented ANA with evidence of entitlement to a 2 refund or, indeed, that she ever asked ANA for a refund. Bugarin claims that ANA nonetheless 3 was obligated to refund her return fare under the plain language of the COC. According to 4 Bugarin, the COC’s provision regarding evidence merely clarifies who may obtain a refund, but 5 does not establish a condition precedent to a refund. She also claims that the COC incorporates an 6 Enforcement Notice issued by the Department of Transportation (“DOT”) on April 3, 2020 (“DOT 7 Enforcement Notice”), which requires issuance of a refund upon cancellation of a flight. FAC ¶¶ 8 41-44. The notice, titled “Enforcement Notice Regarding Refunds by Carriers Given the 9 Unprecedented Impact of the COVID-19 Public Health Emergency on Air Travel,” states that 10 “passengers should be refunded promptly when their scheduled flights are cancelled or 11 significantly delayed.” DOT Enforcement Notice, https://www.transportation.gov/airconsumer/ 12 enforcement_notice_refunds_apr_3_2020 (last accessed Jan. 13, 2021). Bugarin also points to the 13 DOT’s Frequently Asked Questions (“FAQs”) page, posted May 12, 2020, addressing airline 14 passengers’ entitlement to refunds for flights cancelled due to the COVID-19 pandemic. FAC ¶ 4. 15 The FAQs state that “Airlines and ticket agents are required to make refunds promptly. For 16 airlines, prompt is defined as being within 7 business days if a passenger paid by credit card, and 17 within 20 days if a passenger paid by cash or check.” FAQs, https://www.transportation.gov/ 18 airconsumer/FAQ_refunds_may_12_2020 (last accessed Jan. 13, 2021). 19 Bugarin seeks damages for ANA’s alleged breach of its COC or, in the alternative, 20 rescission of the COC, on behalf of herself and the following nationwide class: “All persons in 21 the United States who purchased tickets for travel on an All Nippon flight scheduled to operate to, 22 from, or within the United States whose flights were cancelled or were subject to a significant 23 schedule change and not refunded.” FAC ¶¶ 24, 46, 53. She also seeks to represent “a subclass of 24 all Class members who purchased tickets in California.” FAC ¶ 25. According to Bugarin, “there 25 are hundreds of thousands of individuals that are members of the proposed Classes.” FAC ¶ 29. 26 Bugarin filed the complaint in this action on May 15, 2020 and filed the FAC as of right in 27 response to a motion to dismiss filed by ANA. See Compl., ECF 1; FAC, ECF 15. ANA now 28 moves to dismiss the FAC. 3 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 4 of 23 1 2 DISCUSSION ANA moves to dismiss the FAC on several grounds. First, ANA seeks dismissal under 3 Rule 12(b)(1) for lack of subject matter jurisdiction, arguing that Bugarin cannot demonstrate 4 Article III standing and that her claims are both unripe and moot. Second, ANA seeks dismissal 5 under Rule 12(b)(6) for failure to state a claim upon which relief may be granted. Third, ANA 6 seeks dismissal under Rule 12(b)(2) for lack of personal jurisdiction. Bugarin contends that all of 7 ANA’s asserted grounds for dismissal are without merit. 8 9 United States District Court Northern District of California II. “[J]urisdiction generally must precede merits in dispositional order.” Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 577 (1999). Only if the Court is satisfied that it has both subject 10 matter jurisdiction and personal jurisdiction may it proceed to address ANA’s merits arguments 11 under Rule 12(b)(6). See id. (“Jurisdiction to resolve cases on the merits requires both authority 12 over the category of claim in suit (subject-matter jurisdiction) and authority over the parties 13 (personal jurisdiction), so that the court’s decision will bind them.”). Consequently, the Court first 14 takes up ANA’s Rule 12(b)(1) challenge, then its Rule 12(b)(2) challenge, and finally its Rule 15 12(b)(6) challenge. Before doing so, however, the Court briefly addresses ANA’s submission of 16 evidence in the form of a declaration from one of its executives, Yutaka Ito, and Bugarin’s request 17 for judicial notice. 18 Mr. Ito’s declaration describes ANA’s structure, business practices, and contacts with 19 California. See generally Ito Decl., ECF 18-1. Mr. Ito also states that ANA has provided refunds 20 to thousands of passengers, and that ANA has no record of a request for refund by Bugarin. See 21 Ito Decl. ¶¶ 25-29. Bugarin contends that ANA’s arguments based on Mr. Ito’s declaration “go 22 well beyond the four corners of the pleadings and are inappropriate for consideration at the motion 23 to dismiss stage.” Opp. at 2 n.1, ECF 25. This contention is without merit insofar as ANA seeks 24 dismissal for lack of subject matter jurisdiction and lack of personal jurisdiction, because the 25 Court properly may consider evidence extrinsic to the pleadings when evaluating motions to 26 dismiss under Rules 12(b)(1) and 12(b)(2). See Safe Air For Everyone v. Meyer, 373 F.3d 1035, 27 1039 (9th Cir. 2004) (court may consider evidence beyond the complaint in deciding factual attack 28 under Rule 12(b)(1)); Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 4 United States District Court Northern District of California Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 5 of 23 1 2004) (challenge to personal jurisdiction under Rule 12(b)(2) may be based on materials outside 2 the complaint). Bugarin is correct that Mr. Ito’s declaration may not be considered in evaluating 3 ANA’s Rule 12(b)(6) motion, as the Court’s consideration of that motion is limited to the face of 4 the complaint, matters that may be judicially noticed, and documents that are incorporated by 5 reference into the complaint. See Louisiana Mun. Police Employees’ Ret. Sys. v. Wynn, 829 F.3d 6 1048, 1063 (9th Cir. 2016). 7 Bugarin requests judicial notice of the California Secretary of State’s business records 8 showing that ANA maintains a registered agent for service of process in California. See RJN, 9 ECF 26. The request for judicial notice is GRANTED. See L’Garde, Inc. v. Raytheon Space & 10 Airborne Sys., 805 F. Supp. 2d 932, 938 (C.D. Cal. 2011) (finding it appropriate to take judicial 11 notice of results of records searches on the California Secretary of State’s corporate search 12 website). 13 The Court next turns to ANA’s asserted grounds for dismissal. 14 A. 15 16 Challenge to Subject Matter Jurisdiction under Rule 12(b)(1) 1. Legal Standard A party may challenge the Court’s subject matter jurisdiction by bringing a motion to 17 dismiss under Federal Rule of Civil Procedure 12(b)(1). “A Rule 12(b)(1) jurisdictional attack 18 may be facial or factual.” Safe Air, 373 F.3d at 1039. In a facial attack, the movant asserts that 19 the lack of subject matter jurisdiction is apparent from the face of the complaint. Id. In a factual 20 attack, the movant disputes the truth of allegations that otherwise would give rise to federal 21 jurisdiction. Id. “In resolving a factual attack on jurisdiction, the district court may review 22 evidence beyond the complaint without converting the motion to dismiss into a motion for 23 summary judgment.” Id. “The court need not presume the truthfulness of the plaintiff’s 24 allegations.” Id. If the moving party presents evidence demonstrating the lack of subject matter 25 jurisdiction, the party opposing the motion must present affidavits or other evidence sufficient to 26 establish subject matter jurisdiction. Id. 27 28 2. Discussion ANA’s jurisdictional attack is both facial and factual. ANA argues that the facts pled in 5 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 6 of 23 1 the FAC are insufficient to establish Article III standing or ripeness. ANA also relies on the the 2 declaration of its executive, Mr. Ito, to show that Bugarin has not suffered an injury in fact and 3 that her claims are unripe and moot. See Ito Decl., ECF 18-1. ANA’s challenges based on 4 standing, ripeness, and mootness properly are brought under Rule 12(b)(1). See Chandler v. State 5 Farm Mut. Auto. Ins. Co., 598 F.3d 1115, 1122 (9th Cir. 2010) (standing and ripeness properly 6 raised in Rule 12(b)(1) motion to dismiss); White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000) 7 (standing and mootness properly raised in Rule 12(b)(1) motion to dismiss). 8 United States District Court Northern District of California 9 a. Article III Standing “[T]he ‘irreducible constitutional minimum’ of standing consists of three elements.” 10 Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016) (quoting Lujan v. Defs. of Wildlife, 504 U.S. 11 555, 560 (1992)). “The plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable 12 to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable 13 judicial decision.” Id. (citing Lujan, 504 U.S. at 560-61). “The plaintiff, as the party invoking 14 federal jurisdiction, bears the burden of establishing these elements.” Id. 15 Bugarin alleges that she suffered injury when ANA failed to refund the fare for her return 16 flight from Japan after cancelling that flight. See FAC ¶¶ 38, 41-43. ANA argues that Bugarin’s 17 allegations are insufficient to establish an injury in fact under Article III. “To establish injury in 18 fact, a plaintiff must show that he or she suffered an invasion of a legally protected interest that is 19 concrete and particularized and actual or imminent, not conjectural or hypothetical.” Spokeo, 136 20 S. Ct. at 1548 (quotation marks and citation omitted). ANA asserts that Bugarin cannot meet that 21 requirement here, because under the terms of the COC she is not entitled to a refund unless and 22 until she requests one. It is clear from the face of the FAC that Bugarin never requested a refund 23 from ANA. See FAC ¶ 19 (“Plaintiff called All Nippon several times and was on the phone for 24 several hours each time, but she was never able to reach a representative of All Nippon.”). 25 Moreover, Mr. Ito’s declaration states that ANA has no record of a request for refund by Bugarin, 26 either through ANA’s customer service telephone line or its website. Ito Decl. ¶¶ 26-26, ECF 18- 27 1. Mr. Ito states that ANA has complied with the DOT Enforcement Notice by providing refunds 28 within seven days to passengers who request refunds in accordance with ANA’s COC. See Ito 6 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 7 of 23 1 Decl. ¶ 28. According to Mr. Ito, as of July 2020 ANA had refunded more than 78,000 tickets 2 issued in the United States. See Ito Decl. ¶ 29. Under these circumstances, ANA argues, 3 Bugarin’s claim of injury is conjectural and hypothetical, because she cannot know if ANA will 4 deny her a refund unless and until she requests one. Moreover, ANA argues that there is no 5 substantial risk that Bugarin will be denied a refund given its policy of granting refunds within 6 seven days of a request for refund made in accordance with its COC. United States District Court Northern District of California 7 In response, Bugarin asserts that she was not required to request a refund under the COC, 8 and that such a request is not a condition precedent to obtaining a refund under the COC. She 9 claims that this is so under the plain language of the COC, and because the COC incorporates the 10 DOT Enforcement Notice, which requires carriers to provide refunds promptly after cancellation 11 of flights. Even if a refund request were a condition precedent, Bugarin argues, she attempted to 12 make such a request on multiple occasions but those attempts were frustrated when ANA placed 13 her on endless holds. Bugarin contends that any failure to satisfy the asserted condition precedent 14 is excused by ANA’s conduct. “Under California law, if one contracting party prevents the other 15 from performing a condition precedent, the party that is subject to the condition is excused from 16 performing it.” FNBN Rescon I, LLC v. Citrus El Dorado, LLC, 725 F. App’x 448, 451 (9th Cir. 17 2018); see also City of Hollister v. Monterey Ins. Co., 165 Cal. App. 4th 455, 490 (2008), as 18 modified on denial of reh’g Aug. 28, 2008 (“It is hornbook law that where one contracting party 19 prevents the other’s performance of a condition precedent, the party burdened by the condition is 20 excused from performing it, and the benefited party’s duty of performance becomes 21 unconditional.”). 22 In reply, ANA contends that Bugarin’s interpretation of the COC “is not only contrary to 23 the plain language of the COC, but is nonsensical and would lead to absurd results.” Reply at 1, 24 ECF 27. ANA asks the Court to adopt its interpretation of the COC, under which a passenger 25 must request a refund in order to obtain a refund. Further, ANA asks to the Court to find as a 26 factual matter that it did not prevent Bugarin from requesting a refund, pointing to Mr. Ito’s 27 declaration statements that ANA’s procedures for refunds due to matters outside its control have 28 been available on its website at all times, and that under those procedures Bugarin could have 7 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 8 of 23 United States District Court Northern District of California 1 requested a refund from ANA online or from ASAP. See Ito Decl. ¶¶ 22-23. 2 ANA’s arguments regarding the proper interpretation of the COC are merits arguments 3 that are not appropriate for disposition in the context of a standing inquiry. Alatortev, the case 4 upon which ANA primarily relies in advancing its interpretation of the COC, addressed a Rule 5 12(b)(6) motion to dismiss for failure to state a claim, not a constitutional standing challenge. See 6 Alatortev v. JetBlue Airways Corp., No. 3:17-cv-04859-WHO, 2018 WL 2735355 *5 (N.D. Cal. 7 June 7, 2018) (granting Rule 12(b)(6) motion to dismiss plaintiff’s claims against JetBlue for 8 breach of its Contract of Carriage because “the contractual language simply does not include the 9 obligations Alatortev seeks to impose”). “Whether a plaintiff possesses legally enforceable rights 10 under a contract is a question on the merits rather than a question of constitutional standing. Such 11 a plaintiff fails to state a claim on which relief can be granted.” Lindsey v. Starwood Hotels & 12 Resorts Worldwide Inc., 409 F. App’x 77, 78 (9th Cir. 2010); see also In re Volkswagen “Clean 13 Diesel” Mktg., Sales Practices, & Prod. Liab. Litig., 975 F.3d 770, 776 n.4 (9th Cir. 2020) 14 (“[W]hether Claimants possess legally enforceable rights under the settlement agreement is a 15 question of the merits rather than one of constitutional standing.”). 16 Bugarin alleges that ANA had a contractual obligation to refund her return flight promptly 17 after cancellation of the flight; that ANA breached that obligation; and that Bugarin suffered 18 resulting damages, as she paid for a flight that was cancelled. See FAC ¶¶ 42-25. These 19 allegations are sufficient to assert a concrete injury in fact, that is fairly traceable to the challenged 20 conduct of ANA, and that is likely to be redressed by a favorable judicial decision. That 21 Bugarin’s contract claim may not be adequately alleged, or that ANA may have meritorious 22 defenses to the contract claim, does not deprive Bugarin of constitutional standing. 23 24 25 ANA’s motion to dismiss under Rule 12(b)(1) for lack of Article III standing is DENIED. b. Ripeness “Standing and ripeness under Article III are closely related.” Colwell v. Dep’t of Health & 26 Human Servs., 558 F.3d 1112, 1123 (9th Cir. 2009). “For a suit to be ripe within the meaning of 27 Article III, it must present concrete legal issues, presented in actual cases, not abstractions.” Id. 28 (quotation marks and citation omitted). “But whereas standing is primarily concerned with who is 8 United States District Court Northern District of California Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 9 of 23 1 a proper party to litigate a particular matter, ripeness addressees when that litigation may occur.” 2 Id. (quotation marks and citation omitted). 3 The “ripeness doctrine reflects both constitutional and prudential considerations.” Id. The 4 constitutional ripeness inquiry generally “coincides squarely with standing’s injury in fact prong.” 5 Sacks v. Office of Foreign Assets Control, 466 F.3d 764, 773 (9th Cir. 2006) (quotation marks and 6 citation omitted). Thus, where the court determines that the plaintiff’s “stake in the legal issues is 7 concrete rather than abstract,” constitutional ripeness is satisfied. Colwell, 558 F.3d at 1123. As 8 discussed above, the Court finds that Bugarin has alleged a concrete injury resulting from ANA’s 9 alleged breach of the COC. ANA’s arguments that the COC requires Bugarin to request a refund, 10 and that it did not prevent Bugarin from requesting a refund, go to the merits of the contract claim 11 and not its constitutional ripeness. 12 The prudential ripeness inquiry “developed in order to prevent the courts, through 13 avoidance of premature adjudication, from entangling themselves in abstract disagreements over 14 administrative policies, and also to protect the agencies from judicial interference until an 15 administrative decision has been formalized and its effects felt in a concrete way by the 16 challenging parties.” Golden v. California Emergency Physicians Med. Grp., 782 F.3d 1083, 17 1086-87 (9th Cir. 2015) (quotation marks and citation omitted). The Ninth Circuit has determined 18 that there is no basis for a prudential ripeness inquiry where the dispute does not involve 19 administrative agencies and, specifically, that courts “do not analyze the prudential component of 20 the ripeness inquiry in private contract litigation.” Id. Prudential ripeness therefore is not relevant 21 in the present case, which involves a contract dispute between private parties. 22 23 24 25 ANA’s motion to dismiss under Rule 12(b)(1) for lack of constitutional ripeness is DENIED. c. Mootness “A case becomes moot only when it is impossible for a court to grant any effectual relief 26 whatever to the prevailing party.” Knox v. Serv. Employees Int’l Union, Local 1000, 567 U.S. 27 298, 307 (2012) (quotation marks and citation omitted). “[A]s long as the parties have a concrete 28 interest, however small, in the outcome of the litigation, the case is not moot.” Id. (quotation 9 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 10 of 23 1 2 ANA asserts that the claims of any putative class members are moot, pointing to Mr. Ito’s 3 declaration statement that “ANA has actively provided refunds within seven days of a request 4 when requested by U.S. passengers in accordance with its Conditions of Carriage and its refund 5 policy posted on its website.” Ito Decl. ¶ 28. Mr. Ito also states that “ANA has instructed its 6 authorized agents to do the same.” Id. As of July 2020, ANA had processed more than 78,000 7 refunds to U.S. passengers. Ito Decl. ¶ 29. 8 9 United States District Court Northern District of California marks and citation omitted). This evidence does not establish that Bugarin’s claims are moot, as it is undisputed that she did not receive a refund. Nor is it clear from Mr. Ito’s declaration that the claims of all putative 10 class members are moot, as the identities of all putative class members cannot be ascertained from 11 this record. Finally, Mr. Ito’s indication that refunds have been processed as to U.S. passengers 12 who requested refunds “in accordance” with ANA’s COC does not demonstrate mootness, as there 13 is a dispute regarding the proper interpretation of the COC. 14 ANA’s motion to dismiss under Rule 12(b)(1) on grounds of mootness is DENIED. 15 B. 16 17 Challenge to Personal Jurisdiction under Rule 12(b)(2) 1. Legal Standard “Federal courts ordinarily follow state law in determining the bounds of their jurisdiction 18 over persons.” Walden v. Fiore, 571 U.S. 277, 283 (quoting Daimler AG v. Bauman, 571 U.S. 19 117, 125 (2014)). California’s long-arm statute is coextensive with federal due process 20 requirements. Schwarzenegger, 374 F.3d at 800-01. “Although a nonresident’s physical presence 21 within the territorial jurisdiction of the court is not required, the nonresident generally must have 22 ‘certain minimum contacts . . . such that the maintenance of the suit does not offend traditional 23 notions of fair play and substantial justice.’” Walden, 571 U.S. at 283 (quoting Int’l Shoe Co. v. 24 Washington, 326 U.S. 310, 316 (1945)). 25 When a defendant raises a challenge to personal jurisdiction, the plaintiff bears the burden 26 of establishing that jurisdiction is proper. Ranza v. Nike, Inc., 793 F.3d 1059, 1068 (9th Cir. 27 2015). “Where, as here, the defendant’s motion is based on written materials rather than an 28 evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts to 10 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 11 of 23 1 withstand the motion to dismiss.” Id. “[T]he plaintiff cannot simply rest on the bare allegations of 2 its complaint,” but the uncontroverted allegations in the complaint must be accepted as true. 3 Schwarzenegger, 374 F.3d at 800 (quotation marks and citation omitted). Factual disputes created 4 by conflicting affidavits must be resolved in the plaintiff’s favor. Id. 2. 5 6 ANA is an entity organized under the laws of Japan, and it maintains its principal place of 7 business in Japan. Ito Decl. ¶ 4. ANA asserts that it is not subject to this Court’s personal 8 jurisdiction, either with respect to Bugarin’s individual claims or as to the claims of non-resident 9 putative class members. Bugarin contends that ANA’s personal jurisdiction challenges are 10 11 United States District Court Northern District of California Discussion without merit. a. Bugarin’s Individual Claims 12 A federal district court may exercise either general or specific personal jurisdiction over a 13 nonresident defendant. Daimler, 571 U.S. at. 127. General personal jurisdiction exists when the 14 defendant’s contacts “are so continuous and systematic as to render [it] essentially at home in the 15 forum State.” Id. (internal quotation marks and citation omitted). Specific personal jurisdiction 16 exists when the defendant’s contacts with the forum state are more limited but the plaintiff’s 17 claims arise out of or relate to those contacts. Id. at 127-28. 18 Bugarin contends that ANA is subject to specific personal jurisdiction in California; she 19 does not assert the existence of general personal jurisdiction. The Ninth Circuit has established a 20 three-prong test for whether a court can exercise specific personal jurisdiction over a non-resident 21 defendant: (1) the defendant “must purposefully direct his activities or consummate some 22 transaction with the forum or resident thereof; or perform some act by which he purposefully 23 avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits 24 and protections of its laws”; (2) “the claim must be one which arises out of or relates to the 25 defendant’s forum-related activities”; and (3) “the exercise of jurisdiction must comport with fair 26 play and substantial justice, i.e. it must be reasonable.” Schwarzenegger, 374 F.3d at 802. The 27 plaintiff bears the burden on the first two prongs. Id. “If the plaintiff fails to satisfy either of these 28 prongs, personal jurisdiction is not established in the forum state.” Id. “If the plaintiff succeeds in 11 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 12 of 23 1 satisfying both of the first two prongs, the burden then shifts to the defendant to present a 2 compelling case that the exercise of jurisdiction would not be reasonable.” Id. (quotation marks 3 and citation omitted). United States District Court Northern District of California 4 i. Purposeful Availment 5 Under the first prong of the Schwarzenegger test, Bugarin must show either purposeful 6 availment or purposeful direction by ANA. “[A] showing that a defendant purposefully availed 7 himself of the privilege of doing business in a forum state typically consists of evidence of the 8 defendant’s actions in the forum, such as executing or performing a contract there.” Freestream 9 Aircraft (Bermuda) Ltd. v. Aero Law Grp., 905 F.3d 597, 605 (9th Cir. 2018) (quotation marks and 10 citation omitted). “By contrast, [a] showing that a defendant purposefully directed his conduct 11 toward a forum state . . . usually consists of evidence of the defendant’s actions outside the forum 12 state that are directed at the forum, such as the distribution in the forum state of goods originating 13 elsewhere.” Id. (quotation marks and citation omitted). “[A] purposeful availment analysis is 14 most often used in suits sounding in contract, whereas a purposeful direction analysis is most often 15 used in suits sounding in tort.” Id. (quotation marks and citation omitted). 16 A purposeful availment analysis is most appropriate here, as Bugarin sues only for breach 17 of contract and rescission of contract. Bugarin alleges, and ANA does not dispute, that ANA is 18 Japan’s largest airline, carrying more than 9 million passengers internationally in 2019. FAC ¶ 6. 19 Bugarin further alleges that “ANA maintains an office in this District with 240 employees and has 20 routes that fly to or from airports in California, including the flight at issue that Plaintiff was 21 supposed to board.” FAC ¶ 22. ANA does not dispute those allegations, and in fact Mr. Ito’s 22 declaration confirms that ANA has approximately 240 employees in its California offices and that 23 in 2020 ANA operated five passenger flight routes in and out of California. Ito Decl. ¶¶ 6-8. 24 Bugarin notes that ANA is registered with the California Secretary of State and maintains a 25 registered agent for service of process in California. See RJN, ECF 26. Finally, Bugarin asserts 26 that when she purchased her ticket, she – a California resident – entered into a contract with ANA, 27 specifically, the COC. See FAC ¶ 37 (“Defendant entered into contracts with Plaintiff and 28 members of the Class through its Contract of Carriage.”). Bugarin asserts that these facts are 12 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 13 of 23 1 2 The Court notes that ANA’s reply is devoid of argument on the Schwarzenegger test. 3 ANA does not respond to Bugarin’s showing on the prongs of that test or make any mention of its 4 challenge to the Court’s personal jurisdiction over it with respect to Bugarin’s individual claims. 5 The Court therefore concludes that ANA has abandoned its personal jurisdiction challenge with 6 respect to Bugarin’s individual claims. See Nguyen v. Nissan N. Am., Inc., No. 16-CV-05591- 7 LHK, 2020 WL 5517261, at *9 (N.D. Cal. Sept. 13, 2020) (reply brief’s failure to address 8 opposition arguments constituted abandonment of position taken in opening motion brief). The 9 Court nonetheless addresses the remaining Schwarzenegger prongs, below. 10 11 United States District Court Northern District of California sufficient to meet the purposeful availment prong. The Court agrees. ii. Arising Out Of In determining whether a plaintiff’s claim arises out of or relates to the defendant’s forum- 12 related activities, “the Ninth Circuit follows the ‘but for’ test.” Menken v. Emm, 503 F.3d 1050, 13 1058 (9th Cir. 2007) (quotation marks and citation omitted). Under this test, Bugarin must show 14 that she would not have suffered an injury “but for” ANA’s California-related conduct. 15 Bugarin argues that “but for” ANA’s forum-related activities, in particular operating the 16 flight for which she purchased a ticket and entering into a contractual relationship with her 17 through the COC, she would not have suffered injury. The Court agrees. 18 ANA has not responded to this argument in its reply and thus, in the Court’s view, has 19 abandoned its challenge to personal jurisdiction with respect to Bugarin’s individual claims. The 20 Court notes that ANA’s motion argues that Bugarin cannot satisfy the arising out of prong because 21 she purchased her airline ticket from ASAP, not ANA, and because “[n]o refund-related activity 22 was alleged to have occurred in California.” Mot. at 22, ECF 18. The Court finds ANA’s 23 argument to be unpersuasive. As noted above, Bugarin’s claims are grounded in the COC – a 24 contract between ANA and Bugarin, a California resident – and ANA’s cancellation of a flight 25 that was scheduled to fly into the forum state. ANA has not cited any authority suggesting that the 26 arising out of test cannot be met on these facts. 27 The Court finds that Bugarin has met the arising out of prong. 28 13 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 14 of 23 iii. 1 2 Because Bugarin has satisfied her burden with respect to the first two prongs, the burden 3 shifts to ANA to satisfy the third prong of the Schwarzenegger test. See Schwarzenegger, 374 4 F.3d at 802. ANA has not met this burden, as it has not addressed the reasonableness prong of the 5 Schwarzenegger test in either its motion or its reply. 6 7 8 9 United States District Court Northern District of California Reasonableness ANA’s motion to dismiss under Rule 12(b)(2) for lack of personal jurisdiction with respect to Bugarin’s individual claims is DENIED. b. Non-Resident Putative Class Members’ Claims ANA contends that even if specific personal jurisdiction exists with respect to Bugarin’s 10 individual claims, she has failed to establish the existence of specific personal jurisdiction with 11 respect to the claims of non-resident putative class members. ANA bases its argument on Bristol- 12 Myers Squibb Co. v. Super. Ct. of Cal., 137 S. Ct. 1773 (2017), in which the Supreme Court 13 addressed specific personal jurisdiction in the context of a mass tort action brought against a 14 prescription drug manufacturer, Bristol-Myers Squibb (“BMS”), in California state court. More 15 than 600 plaintiffs, most of whom were not California residents, asserted state law claims based in 16 injuries allegedly stemming from use of BMS’s drug Plavix. Bristol-Myers Squib, 137 S. Ct. at 17 1777. The Supreme Court held that the California state court lacked specific personal jurisdiction 18 over BMS as to claims of non-forum residents, where “the nonresidents were not prescribed 19 Plavix in California, did not purchase Plavix in California, did not ingest Plavix in California, and 20 were not injured by Plavix in California.” Id. at 1781. The Supreme Court concluded that under 21 those circumstances, there was an insufficient connection between the nonresidents’ claims and 22 the forum to support the exercise of specific personal jurisdiction. Id. at 1781-82. 23 ANA asks the Court to dismiss the claims of non-resident putative class members under 24 the reasoning of Bristol-Myers Squib. Bugarin argues that Bristol-Myers Squibb, a mass tort 25 action, does not apply to federal class actions such as this one. The Ninth Circuit has not spoken 26 on the issue, and the decisions of district courts within the Ninth Circuit are split. “District courts 27 have typically taken one of three approaches when asked to consider the application of Bristol- 28 Myers Squibb to nationwide class actions.” Carpenter v. PetSmart, Inc., 441 F. Supp. 3d 1028, 14 United States District Court Northern District of California Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 15 of 23 1 1034 (S.D. Cal. 2020) (collecting cases). “First, many courts hold that Bristol-Myers Squibb does 2 not apply outside of the context of mass tort cases.” Id. (citation omitted). Those courts have 3 determined that it is appropriate to allow claims of non-resident class members to proceed so long 4 as the court has jurisdiction over the class representative’s claims. Id. That determination is based 5 in part on the view that “[t]he due process issue is avoided because Rule 23 class certification 6 already protects a defendant’s due process rights.” Id. (citation omitted). A second set of district 7 courts has held that “the same due process concerns that animated Bristol-Myers Squibb 8 necessarily apply to nationwide class actions in federal courts.” Id. (citation omitted). “A third set 9 of district courts opts to defer this issue until class certification: since unnamed plaintiffs are 10 merely potential class members who may never actually be joined to this action, it would be 11 premature for a court to decide whether there is specific jurisdiction over the defendant(s) with 12 respect to their claims.” Id. (citation omitted). 13 This Court finds the third of these approaches to be the most appropriate in this case. The 14 Court has no way to determine on this record how large any nationwide class would be. While 15 Bugarin alleges that a nationwide class would constitute “hundreds of thousands of 16 individuals,” FAC ¶ 29, ANA asserts that it has provided refunds to all U.S. passengers who made 17 legitimate requests for refund, Ito Decl. ¶¶ 28-29. This approach is consistent with that of other 18 courts in this district. See Vallarta v. United Airlines, Inc., No. 19-CV-05895-HSG, 2020 WL 19 6271151, at *6 (N.D. Cal. Oct. 26, 2020) (“At this early stage of the litigation, no class has been 20 certified, and thus it would be premature to determine whether this Court has jurisdiction over 21 Defendant with respect to the claims of any absent class members prior to class certification.”). 22 ANA’s motion to dismiss under Rule 12(b)(2) for lack of personal jurisdiction with respect 23 to non-resident putative class members’ claims is DENIED. This ruling is without prejudice to a 24 renewed argument based on Bristol-Myers Squibb if and when the case reaches the class 25 certification stage. 26 C. 27 28 Challenge to Pleading under Rule 12(b)(6) 1. Legal Standard “A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a 15 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 16 of 23 1 claim upon which relief can be granted tests the legal sufficiency of a claim.” Conservation Force 2 v. Salazar, 646 F.3d 1240, 1241-42 (9th Cir. 2011) (quotation marks and citation omitted). While 3 a complaint need not contain detailed factual allegations, it “must contain sufficient factual matter, 4 accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 5 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is 6 facially plausible when it “allows the court to draw the reasonable inference that the defendant is 7 liable for the misconduct alleged.” Id. 8 United States District Court Northern District of California 9 When evaluating a Rule 12(b)(6) motion, the district court is limited to the allegations of the complaint, documents incorporated into the complaint by reference, and matters which are 10 subject to judicial notice. Louisiana Mun. Police Employees’ Ret. Sys., 829 F.3d at 1063 (citing 11 Tellabs, 551 U.S. at 322). 2. 12 13 Discussion ANA moves to dismiss both Claim 1 for breach of contract and Claim 2 for rescission. 14 ANA first argues that the claims are preempted by the Airline Deregulation Act (“ADA”), 49 15 U.S.C. § 41713. To the extent the contract claim is not preempted, ANA asserts that it fails 16 because Bugarin has not pled that she satisfied a condition precedent to refund under the COC, 17 specifically, a request for refund. Finally, ANA contends that Bugarin is not entitled to the 18 remedy of rescission as a matter of law. In opposition, Bugarin argues that her claims are not 19 preempted, that there was no condition precedent to a refund, and that she has stated a claim for 20 rescission. 21 a. Preemption 22 “The Airline Deregulation Act of 1978 prohibits States from enacting or enforcing any law 23 relating to air carrier rates, routes, or services.” Am. Airlines, Inc. v. Wolens, 513 U.S. 219, 221-22 24 (1995) (quotation marks, citation, brackets, and ellipses removed). However, while “the ADA’s 25 preemption prescription bars state-imposed regulation of air carriers,” the statute “allows room for 26 court enforcement of contract terms set by the parties themselves.” Id. The exception to 27 preemption recognized by Wolens is narrow. Even where a state law claim is based on an airline’s 28 self-imposed contractual obligations, the claim is preempted if it “seeks to enlarge the contractual 16 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 17 of 23 1 2 ANA asserts that Bugarin’s contract and rescission claims are preempted because they 3 relate directly to ANA’s rates and services. Bugarin responds that her claims fall within the 4 exception articulated by Wolens, because they are based on the express terms of ANA’s COC. 5 6 United States District Court Northern District of California obligations that the parties voluntarily adopt.” Nw., Inc. v. Ginsberg, 572 U.S. 273, 276 (2014). i. The Contract Claim is Not Preempted Claim 1 for breach of contract alleges that ANA breached the COC, which is attached to 7 the FAC as Exhibit A. FAC ¶¶ 35-46 & Exh. A. Bugarin alleges that “Defendant entered into 8 contracts with Plaintiff and members of the Class through its Contract of Carriage.” FAC ¶ 37. 9 She quotes Section 13 of the COC, which provides in part that: “[w]hen a Passenger is prevented 10 from using the Carriage provided for in his/her Ticket resulting from [All Nippon] cancels a flight 11 . . . the amount of the refund shall be . . . if no portion of the trip has been made, an amount equal 12 to the fare paid.” FAC ¶ 38 (quoting COC § 13(C)). 13 Bugarin also quotes language in the COC providing that ANA may cancel a passenger’s 14 reservation “in accordance with Applicable Laws,” FAC ¶ 39 (quoting COC § 8(E)(3)), and that 15 “any carriage and other services to be performed or provided by ANA shall be subject to: (a) 16 Applicable Laws,” FAC ¶ 40 (quoting COC § 17(A)(2)(a)). Bugarin interprets this language to 17 constitute an express incorporation of the DOT Enforcement Notice. FAC 44 (“All Nippon’s 18 Contract of Carriage expressly incorporates the DOT Enforcement Notice.”). She alleges that the 19 DOT Enforcement Notice, as incorporated into the COC, required ANA “to provide refunds to 20 passengers with a “prompt refund” as defined by 14 C.F.R. § 259.5(b)(5). FAC ¶ 44. Section 21 259.5(b)(5) and provisions referenced therein in turn require airlines to provide “prompt” refunds 22 for cancelled flights, meaning within seven days for credit card purchases and within twenty days 23 for cash or check purchases. See Daversa-Evdyriadis v. Norwegian Air Shuttle ASA, No. EDCV 24 20-767-JGB(SPX), 2020 WL 5625740, at *6 (C.D. Cal. Sept. 17, 2020). 25 In Bugarin’s view, these provisions taken together required ANA to provide her with a 26 “prompt refund” upon the cancellation of her return flight. FAC ¶¶ 12, 41, 44. Although not 27 alleged in the FAC, Bugarin apparently paid for her flight by credit card, as she argues in her 28 opposition brief that “Defendant was required to issue a refund to Plaintiff within seven days” of 17 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 18 of 23 1 her flight’s cancellation. Opp. at 1, ECF 25. Claim 1 alleges that ANA breached this obligation 2 by failing to provide passengers with a “prompt refund” for cancelled flights. FAC 44. Because 3 this contract claim is grounded in the express terms of the COC, the Court concludes that it falls 4 within the exception to preemption discussed in Wolens. Whether Bugarin properly interprets the 5 COC raises a separate question that is addressed below. United States District Court Northern District of California 6 In opposition to the motion, Bugarin argues that ANA was required to refund her cancelled 7 flight “immediately” under California Civil Code § 1657. See Opp. at 11, ECF 25. Section 1657 8 reads as follows: “If no time is specified for the performance of an act required to be performed, a 9 reasonable time is allowed. If the act is in its nature capable of being done instantly – as, for 10 example, if it consists in the payment of money only – it must be performed immediately upon the 11 thing to be done being exactly ascertained.” Cal. Civ. Code § 1657. Bugarin argues in her 12 opposition brief that “here, the payment of a refund ‘consists in the payment of money only,’ and 13 shall, accordingly, be paid immediately upon the cancellation of the flight or soon thereafter” 14 under § 1657. Opp, at 11, ECF 25. 15 The FAC does not mention § 1657 or suggest that it governs Bugarin’s contract claim. 16 The Court finds that a contract claim based on application of § 1657 would be preempted by the 17 ADA in this case. The COC does not provide a time frame for refunds. Thus, requiring ANA to 18 provide refunds “immediately” pursuant to § 1657 would impermissibly enlarge or enhance the 19 COC. A number of district courts within the Ninth Circuit have reached the same conclusion in 20 airline refund cases. See Castanares v. Deutsche Lufthansa AG, No. CV 20-4261-MWF (MRWx), 21 2020 WL 6018807, at *4 (C.D. Cal. Oct. 9, 2020) (“[T]he ADA preempts application of Civil 22 Code section 1657 to the Conditions of Carriage.”); Maree v. Deutsche Lufthansa AG, No. SACV 23 20-885-MWF (MRWx), 2020 WL 6018806, at *4 (C.D. Cal. Oct. 7, 2020) (same); Daversa- 24 Evdyriadis, 2020 WL 5625740, at *6 (“Plaintiff’s reliance on section 1657 clearly serves to 25 enlarge[ ] or enhance[ ] the GCC based on state laws or policies external to the agreement.” 26 (quotation marks omitted)). Because the FAC does not rely on § 1657, however, preemption is 27 not warranted. 28 Accordingly, ANA’s motion to dismiss Claim 1 on preemption grounds is DENIED. 18 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 19 of 23 1 2 The Rescission Claim is Preempted Claim 2 for rescission is asserted pursuant to California Civil Code § 1689(b), which 3 enumerates circumstances under which a party may rescind a contract under California law. See 4 Cal. Civ. Code § 1689(b). Bugarin alleges that rescission is warranted under § 1689(b)(4)-(6). 5 FAC ¶ 49. Those subsections read as follows: 6 7 (4) If the consideration for the obligation of the rescinding party, before it is rendered to him, fails in a material respect from any cause. 8 (5) If the contract is unlawful for causes which do not appear in its terms or conditions, and the parties are not equally at fault. 9 (6) If the public interest will be prejudiced by permitting the contract to stand. 10 11 United States District Court Northern District of California ii. Cal. Civ. Code § 1689(b)(4)-(6). Bugarin alleges that “Defendant’s consideration for the payments of Plaintiff and members 12 of the Classes was the provision of flights to and from the United States. Defendant’s 13 consideration failed in a material respect because Defendant cancelled or otherwise did not 14 provide the flights that were the consideration for the payments.” FAC ¶ 50. She also alleges that 15 ANA’s flights were unlawful due to government ordered travel restrictions. FAC ¶ 51. Finally, 16 Bugarin alleges that “[t]he public interest will be prejudiced if the Contract of Carriage is 17 permitted to stand. Defendant will continue to retain the monies of Plaintiff and members of the 18 Classes without providing them flights.” FAC ¶ 52. 19 ANA’s COC governs the parties’ relationship. It explains passengers’ recourse for a 20 cancelled flight and, as relevant here, identifies circumstances under which a passenger may 21 obtain a refund. See COC ¶¶ 8, 13. ANA argues that a state law rescission claim applying Cal. 22 Civ. Code § 1689 to extinguish the COC does not fit within the Wolens exception to ADA 23 preemption, because such application would not enforce the parties’ self-imposed obligations but 24 rather would do just the opposite. The Court agrees. At least one district court within this circuit 25 has found that a rescission claim asserted on similar facts would be preempted. See Daversa- 26 Evdyriadis, 2020 WL 5625740, at *6. Bugarin has not cited any cases suggesting that a rescission 27 claim would not be preempted by the ADA under the facts of this case. 28 19 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 20 of 23 ANA’s motion to dismiss Claim 2 on preemption grounds is GRANTED.3 1 b. 2 ANA argues that even if Bugarin’s claim for breach of contract is not preempted, she has 3 United States District Court Northern District of California Adequacy of Pleading Re Contract Claim (Claim 1) 4 failed to allege sufficient facts to state a claim. “To be entitled to damages for breach of contract, 5 a plaintiff must plead and prove (1) a contract, (2) plaintiff’s performance or excuse for 6 nonperformance, (3) defendant’s breach, and (4) damage to plaintiff.” Walsh v. W. Valley Mission 7 Cmty. Coll. Dist., 66 Cal. App. 4th 1532, 1545 (1998). ANA challenges Bugarin’s pleading on the 8 second element, the plaintiff’s performance or excuse for nonperformance. Specifically, ANA 9 contends that the COC includes a condition precedent to obtaining a refund, which is the 10 passenger’s submission of evidence of entitlement to a refund. Bugarin argues that the COC does 11 not contain a condition precedent to a refund. Moreover, she asserts that ANA’s conduct in 12 putting her on endless holds when she telephoned to request a refund excuses her nonperformance 13 of the asserted condition precedent. 14 The contract claim does not specify what state law governs. The parties apply California 15 law, so the Court does as well. Under California law, “[c]onditions precedent must be expressed 16 in plain, clear, and unambiguous language, but parties need not invoke any required magical 17 incantation.” Int’l Bhd. of Teamsters v. NASA Servs., Inc., 957 F.3d 1038, 1043 (9th Cir. 2020) 18 (quotation marks and citation omitted). “It is elementary a plaintiff suing for breach of contract 19 must prove it has performed all conditions on its part or that it was excused from performance.” 20 Consol. World Investments, Inc. v. Lido Preferred Ltd., 9 Cal. App. 4th 373, 380 (1992). ANA contends that a condition precedent to obtaining a refund is set forth in Section 13(B) 21 22 of the COC, which reads in relevant part as follows: 23 (B) Person to whom Refund will be made 24 (1) Unless otherwise provided in this Paragraph, ANA will make a refund to the person named in a Ticket or, to the person who purchased the Ticket upon presentation to ANA of satisfactory evidence to prove that he/she is entitled by these Conditions of Carriage to such refund. 25 26 27 28 In light of this ruling, the Court need not reach ANA’s alternative argument that the rescission claim is subject to dismissal for failure to allege adequate facts. 20 3 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 21 of 23 1 2 3 United States District Court Northern District of California 4 (2) (a) If a person other than the Passenger named in a Ticket pays for the Ticket and designates a person to whom refund shall be made, ANA will indicate on the Ticket that there is a restriction on a person to whom refund shall be made and make a refund only to the designated person. COC § 13(B) (emphasis added). The FAC simply ignores this language, which appears to provide that prior to obtaining a 5 refund, a passenger must present ANA with satisfactory evidence of entitlement to a refund. 6 Bugarin asserts that the language does not create condition precedent, but merely clarifies who 7 may obtain a refund. While § 13(B)(1) does indicate two potential refund recipients, the person 8 named on the ticket and the person who purchased the ticket, either person must present ANA 9 with evidence of entitlement to a refund in order to obtain a refund. It therefore appears from the 10 plain language of the COC that a request for refund, supported by evidence sufficient to prove 11 entitlement to a refund, is a condition precedent to obtaining a refund. 12 Bugarin argues that no request for refund is required under the DOT Enforcement Notice, 13 which she argues is incorporated into the COC. Bugarin’s reliance on the DOT Enforcement 14 Notice is misplaced. The “vast majority” of district courts to address the issue have held that 15 “boilerplate contractual language guaranteeing compliance with international or domestic aviation 16 laws does not incorporate extraneous law into the terms of an airfare contract.” Daversa- 17 Evdyriadis, 2020 WL 5625740, at *4. “[O]nly language explicit enough to reflect an intent to be 18 affirmatively bound by a specific aviation law or regulation is sufficient to result in 19 incorporation.” Id. The language to which Bugarin points, indicating that ANA may cancel a 20 passenger’s reservation “in accordance with Applicable Laws,” COC § 8(E)(3), and that ANA’s 21 carriage and other services shall be “subject to . . . Applicable Laws,” COC § 17(A)(2)(a), simply 22 is not specific enough. See Castanares, 2020 WL 6018807, at *4 (“The Court agrees with 23 Lufthansa that the DOT regulations relied upon by Plaintiffs are not expressly incorporated into 24 Lufthansa’s Conditions of Carriage.”). 25 Bugarin argues that if there is a condition precedent, it is excused in this case because “she 26 made multiple attempts to obtain a refund, but was unable to reach Defendant because Defendant 27 left Plaintiff and Class members in an endless hold loop.” Opp. at 3, ECF 25. “Under California 28 law, if one contracting party prevents the other from performing a condition precedent, the party 21 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 22 of 23 1 that is subject to the condition is excused from performing it.” FNBN Rescon I, 725 F. App’x at 2 451; see also City of Hollister, 165 Cal. App. 4th at 490 (“It is hornbook law that where one 3 contracting party prevents the other’s performance of a condition precedent, the party burdened by 4 the condition is excused from performing it, and the benefited party’s duty of performance 5 becomes unconditional.”). Bugarin’s allegations regarding her attempt to obtain a refund are quite sparse, totaling United States District Court Northern District of California 6 7 three sentences in the paragraph identifying her as a party in the case. See FAC ¶ 19. The 8 sentences read: “Plaintiff attempted to request a cash refund from All Nippon by calling All 9 Nippon. Plaintiff called All Nippon several times and was on the phone for several hours each 10 time, but she was never able to reach a representative of All Nippon. Plaintiff was not refunded by 11 All Nippon for her return flight, despite these repeated requests.” FAC ¶ 19. The Court finds 12 these allegations to be insufficient to show that ANA prevented Bugarin from performing the 13 condition precedent. ANA’s motion to dismiss Claim 1 for failure to state a claim is GRANTED WITH LEAVE 14 15 TO AMEND. On amendment, Bugarin may attempt to allege facts showing that Section 13(B) 16 does not create a condition precedent to refund. For the reasons discussed above, it is the Court’s 17 view that the language in question does appear to create a condition precedent. However, as 18 Bugarin has not previously addressed the language in her pleading, it may be that she can allege 19 facts showing the contrary. To the extent Bugarin claims that her performance of any condition 20 precedent was excused, she shall allege facts supporting that claim with more particularity. 21 22 23 III. ORDER (1) ANA’s motion to dismiss is: (a) claim under Rule 12(b)(6); 24 25 (b) GRANTED WITHOUT LEAVE TO AMEND as to Claim 2 on preemption grounds under Rule 12(b)(6); and 26 27 GRANTED WITH LEAVE TO AMEND as to Claim 1 for failure to state (c) otherwise is DENIED. 28 22 Case 5:20-cv-03341-BLF Document 31 Filed 01/19/21 Page 23 of 23 1 (2) Any amended pleading shall be filed on or before February 9, 2021. 2 (3) Leave to amend is limited to Claim 1 for breach of contract. No additional claims or parties may be added without leave of the Court. 3 4 (4) This order terminates ECF 18. 5 6 7 8 Dated: January 19, 2021 ______________________________________ BETH LABSON FREEMAN United States District Judge 9 10 United States District Court Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 23

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