Case 3:16-cv-00935-RS Document 44 Filed 07/15/16 Page 1 of 48

Transcription

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JEFFREY F. KELLER (SBN 148005)
jfkeller@kellergrover.com
CAREY G. BEEN (SBN 240996)
cbeen@kellergrover.com
SARAH R. HOLLOWAY (SBN 254134)
sholloway{Cl{kellergrover.com
KELLER GROVER, LLP
1965 Market Street
San Francisco, California 94103
Tel: (41°5)543-1305 /Fax: (415) 543-7861
JOHN G. JACOBS (PRO HAC VICE)
j gj aco bs(a),jaco bskolton.com
BRYAN G. KOLTON (PRO HAC VICE)
bgkolton@jacobskolton.com
JACOBS KOLTON, CHTD.
55 West Monroe Street, Suite 2970
Chicago, Illinois 60603
Tel: (312) 427-4000 /Fax: (312) 268-2425
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DAVID SCHACHMAN (PRO HAC VICE)
ds@schachmanlaw.com
LAW OFFICES OF DAVID SCHACHMAN, P.C.
55 West Monroe Street, Suite 2970
Chicago, Illinois 60603
Tel: (312) 427-9500 /Fax: (312) 268-2425
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Attorneys for Plaintiff and the Putative Clas.~·~ _
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IN THE UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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TIMOTHY FORSYTH, individually and on
behalf of a class of similarly situated individuals,
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PLAINTIFF'S OPPOSITION TO [1]
DEFENDANTS' SPECIAL MOTION TO
STRIKE PURSUANT TO CALIFORNIA
ANTI-SLAPP STATUTE, CAL. CIV.
PROC. CODE § 425.16 ET SEQ., OR, IN
THE ALTERNATIVE, [2] MOTION TO
DISMISS PURSUANT TO FED. R. CIV.
P. 12(B)(6); MEMORANDUM OF
POINTS AND AUTHORITIES
Plaintiff,
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vs.
MOTION PICTURE ASSOCIATION OF
AMERICA, INC., et al.,
.
~
Case No. 3:16-cv-00935-RS
-
Defendants.
Date:
Time:
Place: Courtroom 3, 17thFloor
Judge: Hon. Richard Seeborg
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Plaintiffs Opposition To Defendants' Special
Motion To Strike
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16-CV-00935-RS
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TABLE OF CONTENTS
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I.
INTRODUCTION ............................................................................................................
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IL
THE FRAMEWORK FOR ANTI-SLAP MOTIONS IN
FEDERAL COURT ................................................................................... ·....................... 3
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1
A..
The Two-Step Analysis When The Anti-SLAPP Statute Is Applied ................ 3
B.
The California Anti-SLAPP Statute Should Not Be Applied
in Federal Court ....................................................................................................
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III.
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DEFENDANTS CANNOT ESTABLISH THAT THE CONDUCT TARGETED
IN THE COMPLAINT IS "BASED ON" DEFENDANTS' PROTECTED
SPEECH ON AN ISSUE OF "PUBLIC INTEREST." ................................................... .4
A.
The speech at issue is pure commercial speech: Defendants'
registered PG-13 certification trademark rating of films
with tobacco imagery ............................................................................................ 4
B.
Defendants Incorrectly Describe the Speech that
The Complaint is "based on" ................................................................... 7
C.
Plaintiffs claims are not "based on" protected speech
on a "public issue" .................................................................................... 9
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IV.
PLAINTIFF HAS DEMONSTRATED A PROBABILITY
OF PREVAILING ON THE MERITS .......................................................................... 15
A.
The First Amendment Does Not Provide Immunity For
Defendants' Commercial Speech ........................................................................ 15
B.
Plaintiff's Negligent Misrepresentation Claim (Count VII)
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Properly States A Claim ................................................. ,..................................... 19
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1.
The false and misleading representations of fact or
actionable opinions and omissions that are alleged ................................ 19
2.
The representations in question are actionable representations of
fact ...........................................................................................................
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3.
Even if regarded as opinions, false and misleading opinios are
sufficient to state a claim for negligent misrepresentation ..................... 22
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4.
Defendants mischaracterize Plaintiffs allegations of false and
misleading representations ..................................................................... 23
5.
Defendants fail to establish the absence ofreasonable reliance ............ 24
6.
The Complaint establishes proximate causation ..................................... 27
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C.
Plaintiffs negligence and voluntary undertaking claims (Counts I and II)
properly state claims ........................................................................................... 28
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Plaintiffs Opposition to Defendants' Special
Motion to Strike
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l 6-CV-00935-R
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TABLE OF CONTENTS
(continued)
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1.
Defendants did not disclaim their liability for negligence ...................... 30
2.
Defendants' argument that they voluntarily assumed a narrower
duty than the duty·alleged in the Complaint ........................................... 31
D.
Plaintiffs fraudulent misrepresentation Claim (Count IV) properly states a
claim ......... ....................................... .................................. ................................. 34
E.
Plaintiffs breach of fiduciary duty claim (Count III) properly states a claim .... 35
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F.
Plaintiffs nuisance claim (Count VIII) properly states a claim ......................... 37
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G.
Plaintiffs false advertising claim (Count VI) properly states a claim ........ ........ 37
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H.
Plaintiffs unfair competition law Claim (Count V) properly states a claim ...... 38
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I.
Defendants' Motion to Dismiss under Rule 12(b)( 6) should be denied ............. 38
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II.
CONCLUSION ............. ............... ................................................... ................................ 39
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Motion to Strike
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TABLE OF AUTHORITIES
1
2
Cases
3
Abbas v. Foreign Policy Grp., LLC,
783 F.3d 1328 (D.C. Cir. 2015) ........................................................................................
4
4
5
All One God Faith, Inc. v. Organic & Sustainable Indus. Standards, Inc.,
.
83 Cal. App. 4th 1186 (2010) ................................................................ 3, 6, 9, 10, 11, 14 ·
6
Anunziato v. eMachines, Inc.,
402 F. Supp. 2d 1133 (C.D. Cal. 2005) ..................................... .................................... 21
7
8
Apodaca v. Whirlpool Corp.,
2013 WL 6477821 (C.D. Cal. Nov. 8, 2013) .................................................................
21
9
Bohac v. Gen. Mills, Inc.,
2014 WL 1266848 (N.D. Cal. Mar. 26, 2014) ...... .........................................................
21
10
11
12
13
14
Bolger v. Youngs Drug Products Corp.
463 U.S. 60 (1983) ....... ............................................................................................
Brown v. Entm 't Mere. Ass 'n,
564 U.S. 786 (2011) .................... ........................................ ...................................... 1, n.1
California Pub. Employees' Ret. Sys. v. Moody's Inv'rs Serv., Inc.,
226 Cal. App. 4th 643 (2014) ............................................................................
Equilon2i~e:{4~h~
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Cel-Tech Commc'ns, Inc. v. Los Angeles Cellular Tel. Co.,
20 Cal. 4th 163 (1999) ...........................................................
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19
20
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23
24
25
26
27
14, 15, 24
r(iooJ)~~~.
~~~~.~:.~~.~:~ .....................
···········
·······
·········
·············
·············
····3
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12, 17
........................................ 39
Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n of New York,
447 U.S. 557 (198 ...........................................................................................................
Chacanaca v. Quaker Oats Co.,
752 F. Supp. 2d 1111 (N.D. Cal. 2010) ....................................................................
City of Cotati v. Cashman,
29 Cal. 4th 69 (2002) ...................................................................
17
21, 28
........... ......................... 3
Coastal Abstract Serv., Inc. v. First Am. Title Ins. Co.,
173 F. 3d 725 (9th Cir. 1999) ...........................................................
............................... 21
Comm. On Children's Television, Inc. v. Gen. Foods Corp.,
35 Cal. 3d 197 (1983) ...............................................................................................
Consolidated Metal Products, Inc. v. American Petroleum Institute,
846 F. 2d 284 (5th Cir. 1988) ......................................................................................
Consumer Justice Ctr. v. Trimedica Int'!, Inc.,
107 Cal. App. 4th 595 (2003) ............................................................
37, 38
6, 10
................. . 3, 11, 12
Cook, Perkiss & Liehe, Inc. v. N California Collection Serv. Inc.,
911 F. 2d 242 (9th Cir. 1990) .........................................................................................
21
28
Motion to Strike
lV
16-CV-00935-R
(continued)
1
2
Cases
Page(s)
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4
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Cortina v. Goya Foods, Inc.,
94 F. Supp. 3d 1174 (S.D. Cal. 2015) ............................................. ................................ 21
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Davis v. HSBC Bank Nevada , NA.,
691 F.3d 1152 (9th Cir. 2012) ....................................... ................................... ......... 27, 28
7
Delacruz v. Cytosport, Inc.,
2012 WL 1215243 (N.D. Cal. Apr. 11, 2012) .............. .................................................. 21
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Doran v. Milland Dev. Co.,
159 Cal. App. 2d 322 (1958) ........................................................................................... 24
9
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Dyer v. Childress,
147 Cal. App. 4th 1273 (2007) ....................................................................................... 16
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Ericss on GE Mobile Communications, Inc. v. CS.I Telecommunications Engineers,
49 Cal. App. 4th 1591 (1996) ........................................... ....................................... ...... 12
12
Falk v. Gen. Motors Corp.,
496 F. Supp. 2d 1088 (N.D. Cal. 2007) ................................ ........................ .................. 25
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Goldsmith v. Allergan, Inc.,
2011 WL 2909313 (C.D. Cal. May 25, 2011) ...................... .......................................... 21
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Hauter v. Zogarts,
14 Cal. 3d 104 (1975) ....................................................... ............................................. 21
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Hensley-Maclean v. Safewa1,,_Inc.,
2014 WL 1364906 (N.D. Cal. Apr. 7, 2014) ................................ ................ 29, 30, 31, 39
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Herbert v. Lankershim,
9 Cal. 2d 409 (1937) ............. ...................................................................... .................... 37
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In re Tobacco II Cases,
46 Cal. 4th 298 (2009) ................................... .............................................. .................. 28
In re Tobacco Cases II,
240 Cal. App. 4th 779 (20 l 5) ..................................... ......................... ........................... 27
Jackson v. AEG Live, LLC,
233 Cal. App. 4th 1156 (2015) ........................................ ...................... ................... 31, 34
Jewett v. Capital One Bank,
113 Cal. App. 4th 805 (2003) ............. .......................................... ................................. 13
Jolley v. Chase Home Fin., LLC,
213 Cal. App. 4th 872 (2013) ....................................... .................................................. 24
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Plaintiff's Opposition to Defendants' Special
Motion to Strike
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l 6-CV-00935-R
(continued)
1
2
Cases
Page(s)
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Kasky v. Nike, Inc.,
27 Cal. 4th 939 (2002) ..................................................................................
.................. 17
Keegan v. Am. Honda Motor Co.,
838 F. Supp. 2d 929 (C.D. Cal. 2012) ................... ....................................... .................. 27
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7
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Kwikse~ Icii.
4tguf{oic20Iff~~' ........................................................................
............... 6, 26, 28
L.A. Taxi Coop., Inc. v. Indep . Taxi Owners Ass'n of Los Angeles,
239 Cal. App. 4th 918 (2015) ...................................................................................
13, 16
Lyons v. Bank of Am., NA,
2011 WL 3607608 (N.D. Cal. Aug. 15, 2011) ............................................................... 39
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Makaeff v. Trump Univ., LLC,
736 F.3d 1180 (9th Cir. 2013) ................................ ................................ ................ ........... 4
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Mann
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Martinez v. Metabolife Int'!, Inc.,
113 Cal. App. 4th 181 (2003) .........................................................................................
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v.1¥0~!7.
z~~.~ilie9ie(2064{~
.................... .......... ........................................................... l3
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Melton v. Boustred,
183 Cal. App. 4th 521 (2010) ............................. ........................................... ............ ..... 31
Motion
tJ6trs~;~'~
21~~n.ff
Y.vi!sJ)~.~
..~:.~.~~.~~~..~~~·.~······
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Motion Picture Ass'n of Am., Inc. v. Respect Sportswear, Inc.,
.
83 U.S.P.Q. 2d 1555 (P.T.O. Apr. 13, 2007) ............................................................ 18, 23
Mullins v. Premier Nutrition Corp.,
2016 WL 1534784 (N.D. Cal. Apr. 15, 2016) ................................................................ 28
Nagel v. Twin Labs ., Inc.,
.
109 Cal. App. 4th 39 (2003) ............................................................... .......... ..... 12, 13, 14
Nat'! Ahnrtinn Fed'n v. Ctr. for Med. Prnf!ress.
2015 WL 5071977 (N.D. Cal. Aug. 27, 2015) ................................................................. .4
nSight, Inc. v. PeopleSoft, Inc.,
2005 WL 1287553 (N.D. Cal. June 1, 2005) ......................................................... 22, n.14
Persson v. Smart Inventions, Inc.,
125 Cal. App. 4th 1141 (2005) .......................................................................................
37
Ries v. Arizona Beverages USA LLC,
287 F.R.D. 523 (N.D. Cal. 2012) .................................................................. .......... ........ 26
Rezec v. Sony Pictures Entm't, Inc.,
116 Cal. App. 4th 135 (2004) ........................................................................................
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Motion to Strike
Vl
16-CV-0093 5-R
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(TABLE OF AUTHORITIES
(continued)
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3
Cases
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Rowland v. Christian,
69 Cal. 2d 108 (1968) ............................................................
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Page(s)
.-........................................ 31
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Scott v. Metabolife Int'!, Inc.,
115 Cal. App. 4th 404 (2004) .........................................................................................
14
7
Siegal v Gamble,
2016 WL 1085758 (N.D. Cal. March 21, 2016) ..............................................................
.4
Team Enterprises, LLC v. W Inv. Real Estate Trust,
647 F. 3d 901 (9th Cir. 2011) ..........................................................................................
38
8
9
10
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ThermoLife Int'l, LLC v. Gaspari Nutrition Inc.,
2016 WL 1460171 (9th Cir. Apr. 14, 2016) ..........................................................
21, n.14
Thesier-Hendricks v. TJL Enterprises, Inc.,
2015 WL 10791893 (C.D. Cal. Aug. 3, 2015) ......................................................
26, n.20
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13
Turcios v. Carma Labs., Inc.,
296 F.R.D. 638 (C.D. Cal. 2014) .......................................... .......................................... 27
14
Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc.,
425 U.S. 748 (1976) ....................... ..................................................................
15
Vitt v. Apple Computer, Inc.,
469 F. App'x 605 (9th Cir. 2012) ........... ............ ...... ............................................. 21, n. 14
16
............... 17
17
Walter v. Hughes Commc'ns, Inc.,
682 F. Supp . 2d 1031 (N.D. Cal. 2010) ............. .................... ................................ 21, n.14
18
Williams v. Gerber Products Co.,
552 F. 3d 934 (9th Cir. 2008) ..........................................
19
~ ......................................
21, n.14
20
Wilson v. Hewlett-Packard Co.,
668 F.3d 1136 (9th Cir. 2012) ................. ................................ ............................... 25, n.18
21
World Fin. Grp., Inc. v. HBW Ins . & Fin. Servs., Inc.,
·
172 Cal. App. 4th 1561 (2009) .......................................................
22
....... .................. ....... 13
Young v. Facebook, Inc.,
2010 WL 4269304 (N.D. Cal. Oct. 25, 2010) ...........................................................
32, 33
23
OTHER AUTHORITIES
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1306.0l(b) of the United States Department of Commerce, Patent
and Trademark Office, Trademark Manual of Examining Procedures
111
(6 ed., Oct. 2009) (TMEP) ..................................... ....................................................................
26
15 u.s.c. §1051 ................... ...... ...... ...... .............................................................
27
Cal. Civ. Proc. Code §425.16(e) ........................ ...........................................................................
6
............ ........ 6, 17
3
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Plaintiff s Oppos ition to Defendants' Special
Motion to Strike
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16-CV -00935 -R
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I.
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Defendants are a trade association and its rating board members, sued for false and
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misleading commercial speech - for the false and misleading certification labels placed on
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movies for the purpose of promoting the sale of those movies. The complaint raises no question
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of artistic freedom or of defendants' right to participate in public debate; instead this lawsuit deals
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with quotidian issues of false labeling and advertising. The complaint asserts that defendants
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cannot affix a PG-13 or lower certification on movies with tobacco imagery, because they know
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that it has been scientifically established that subjecting children to such imagery will result in the
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premature death of more than a million ofthem.
INTRODUCTION
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Defendants can give no rating to films with
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tobacco, they can give a very restrictive rating, but what they cannot give is a false certification
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that such movies are appropriate for unaccompanied children under 17, when they know that the
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scientific community has overwhelmingly said that it is not.
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In the Motion, however, straightforward claims for negligence, consumer fraud and false
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advertising against a trade association promoting the sale of its members' products have been
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improperly analyzed as if they were defamation claims against newspapers, book publishers and
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news agencies for speech published to inform the public about issues of public interest.
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Defendants assert that their speech is being targeted. Yet, every negligent
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misrepresentation, consumer fraud and false advertising case challenges speech. But the
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"speech" that is being targeted is false commercial speech; it is the false and misleading ratings
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that defendants assign and then affix to each film they rate with the individual, numbered
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certification trademark or seal of the MP AA. Assume Coke, Pepsi and Dr. Pepper form a trade
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This fact makes the attempted reliance by defendant NATO in its supplemental brief on Brown
v. Entm 't Mere. Ass 'n, 564 U.S. 786, 794-96 (2011), impossible. In Brown, the Supreme Court
refused to allow a ban on the sale of violent videos to persons under 18, in particularly relevant
regards to this case, because there was no established scientific causal relationship between
viewing such videos and untoward effects on the youngsters. (Id. at 800.) Here, the exact
opposite is true. Here, the Complaint specifically alleges the findings of the Surgeon General and
the Center For Disease Control that exposure of youngsters to movies with tobacco imagery will
result in their addiction and disease and pre_mature deaths from tobacco-related diseases.
Complaint,, 45-50.
Motion to Strike
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association, and the association inspects its members' products and puts labels on each bottle
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certifying that the contents are suitable for children under seventeen to drink, when the
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association and its members know that children, because of their still-developing metabolisms,
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have a unique sensitivity to one of the ingredients that causes children to develop debilitating
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diseases and that it will kill one million children. This case is no different.
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The false and misleading labeling of movies in this case does not involve the type of
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noncommercial speech that commands the First Amendment protections defendants rely upon.
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Defendants are free to express their opinions in newspapers and books and press releases about
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the appropriate way to rate films with tobacco imagery, and the expression of their opinions in
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that form is protected by core First Amendment principles. However, when defendants make
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false and misleading representations on product labels or advertisements for the purpose of selling
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products, they are engaged in quintessential commercial speech, and such commercial speech is
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not protected by the First Amendment. To the contrary, this is precisely the kind of speech that is
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subject to the traditional tort, consumer protection and false advertising laws asserted here.
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The claims in this case are not based on anything defendants said in press releases,
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newspapers or other publications. The claims are based upon the labels defendants affixed on
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their members' and others' products for the purpose of promoting and selling theirproducts-
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films. Defendants have known that exposure of children to tobacco imagery in films causes
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children to become addicted to nicotine, develop tobacco related diseases and die. Despite that
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knowledge, defendants have rated and continue to rate films with tobacco imagery as suitable for
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children under seventeen unaccompanied by a parent or guardian. These PG-13 certifications and
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labels on films are false and misleading and omit critical health and safety warnings. Defendants
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cannot wrap themselves in the First Amendment and avoid accountability.
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Defendants' attempted invocation of the anti-SLAPP statute is inappropriate and seeks to
threaten Plaintiff for challenging their calculatedly cynical conduct. It should not be allowed.
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Motion to Strike
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II.
The Framework for Anti-SLAPP motions in Federal Court
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a.
The two-step analysis when the Anti-SLAPP statute is applied
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The California Anti-SLAPP law requires a two-step analysis.
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First, defendants bear. the burden to establish that plaintiff's claims are "base d on," that is,
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"arise from" defendants' protected rights of petition or free speech. Equilon Enterprises v.
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Consumer Cause, Inc., 29 Cal.·4th 53, 66, 52 P.3d 685 (2002) ("1be "arising from" requirement
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is not easily met."); City of Cotati v. Cashman, 29 Cal. 4th 69, 78, 52 P.3d 695 (2002) ("In the
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anti-SLAPP context , the critical point is whether the plaintiff's cause of action itself was based on
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an act in furtherance of the defendants' right of petition or free speech.").
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In addition_ under the first sten of the amilvsis. rlefeml:mts mm: t e.sfahli sh th!it their
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complaint under Rule 12(b)(6) standards or, alternatively, whether defendants contend that
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plaintiff is unable to produce evidence to support the allegations or defendants dispute the
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accuracy of the facts alleged in the complaint under Rule 56 standards. Nat'l Abortion Fed'n v.
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Ctr.for Med. Progress, No. 15-CV-03522-WHO , 2015 WL 5071977, at *4 (N.D. Cal. Aug. 27,
5
2015).
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Defendants ' Motion challenges only the legal sufficiency of the Complaint under Rule
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12(b)( 6) standards. 4 Thus, if the Court determines the Complaint states claims for relief under
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well-established 12(b)(6) standards, plaintiff has satisfied his burden to demon strate a probability
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of prevailing on the claims and the anti-SLAPP motion must be denied.
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Defendants cannot meet their burden to demonstrate that the claims are "based on" any
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speech by defendants on an issue of "public interest." But even if they could, plaintiff has
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demonstrated a probability of prevailing on the claims. Defendants' Motion should be denied.
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b.
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Plaintiff acknowledges that bindin g Ninth Circuit precedent requires consideration of the
The California anti-SLAPP statute should not be applied in Federal Court
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California anti-SLAPP until the Supreme Court or the Ninth Circuit changes the current law.
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Siegal v Gamble, 2016 WL 1085758, at *9 footnote 2 (N.D. Cal. March 21, 2016) (J.Seeborg).
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For purposes of preserving his right to appeal, however, plaintiff objects to application of
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California's anti-SLAPP statute for all the reasons described in Makaeff v. Trump Univ., LLC,
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715 F.3d 254, 272-276 (9th Cir. 2013) (Concurring opinions of Chief Judge Kozinski and Judge
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Paez) . See also, Makaeff v. Trump Univ., LLC, 736 F.3d 1180 (9th Cir. 2013). 5
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III.
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Defendants cannot establish that the conduct targeted in the Complaint is "based
on" defendants' protected speech on an issue of "public interest."
a.
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The speech at issue is pure commercial speech: defendants' registered
PG-13 certification trademark rating of films with tobacco imagery
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4
See, Stipulation Dkt #40, Par.3.
,
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The Motion explicit ly points to at least one aspect of the anti-SLAPP law that conflicts with the
Federal Rules of Civil Procedure. Defendants assert the right to attorneys' fees and costs if they
prevail on the anti-SLAPP moti on under standards that directly conflict with Rule 11. Motion at
3, fu. 2. Notably, since the denial of the motion for rehearing en bane in Maka e.ff,a split in the
Circuits has developed . Abbas v. Foreign Policy Grp., LLC, 783 F.3d 1328 (D.C. Cir. 2015).
Motion to Strike
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16-CV-009 35-R
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Plaintiff summarizes the speech that the Complaint is actually "based on" below because
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the speech that the claims are actually "based on" is not described or discussed anywhere in
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defendants' Motion.
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The speech the claims are "based on" consists of the certification trademarked ratings that
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defendants assigned and then affixed to the ten films listed in the Complaint that contain tobacco
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imagery (and the numerous additional other films that also contain tobacco imagery).
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Defendants' rating system was created in 1968. Since 1984, defendants' rating system has
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consisted of five registered certification trademarks registered with the United States Department
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of Commerce, Patent and Trademark Office, including the following three:
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PG - Parental Guidance Suggested. Some Material May Not Be Suitable For
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Children.
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PG-13 - Parents Strongly Cautioned. Some Material May Be Inappropriate For
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Children Under 13.
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R - Restricted. Children Under 17 Require Accompanying Parent or Adult
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Guardian.
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Defendants inspect each film, certify the film with one of the five certification trademarked
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ratings and then assign each film a unique, sequentially numbered seal or certificate and the
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rating is then physically affixed to the film and is used on all trailers and advertisements for that
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film. Complaint~~ 55-60, and 107 (a)-(j); and Complaint, Ex 1.
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Certification trademarks are a special type of speech - speech that is a creation of federal
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trademark law - speech that is used for distinct, important and, for purposes of resolving the
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issues raised by defendants' anti-SLAPP motion, legally significant, commercial purposes.
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Certification trademarks provide crucial information to consumers about the product that is
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certified. The certification is a commercial message and representation to the consumer that the
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goods or services have been inspected, examined, or tested. The certification is a representation
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to the consumer that the goods or services possess certain characteristics or qualities or meet
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certain standards established by the owner of the certification trademark. In addition, the owner
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Plaintiff' s Opposition to Defendants' Special
Motion to Strike
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1
of the certification trademark is prohibited from applying the certification trademark to his or her
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own goods or services. Therefore, the use of a certification trademark is a representation that an
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independent party has inspected, examined and tested the product or service and certifies to the
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consumer that the product or service has been determined to have the prescribed qualities or
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characteristics and meets certain standards. Consumers rely upon certification trademarks
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because the certification representation saves consumers the trouble of investigating the product
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themselves and the risk of trying untested products. All One God Faith, Inc. v. Organic &
8
Sustainable Indus. Standards, Inc., 183 Cal. App. 4th 1186, 1204 n.16 and 1221-22; Consol.
9
Metal Products, Inc. v. Am. Petroleum Inst., 846 F.2d 284,296 (5th Cir. 1988); and 1306.0l(b) of
1o
the United States Department of Commerce, Patent and Trademark Office, Trademark Manual of
11
Examining Procedures (6th ed., Oct. 2009) (TMEP).
12
The claims in this case are "based on" defendants' certification of each movie featuring
13
tobacco imagery with defendants' registered PG-13 certification trademarked rating ("PG-13 -
14
Parents Strongly Cautioned. Some Material May Be Inappropriate For Children Under 13") and
15
the descriptor portion of the rating for each film. Complaint ,r107 (a) - G).
16
As a matter of federal trademark law, defendants' certification trademarks are designed,
17
intended and used by defendants for commercial purposes: to make a representation to Mr.
18
Forsyth and all other parents that the MPAA inspected the product - the film - and that each film
19
it rates qualifies for the rating that the MPAA assigns to the film for the purpose of promoting the
20
sale of the film. 6
21
22
23
24
25
26
27
See also, Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, 328-329, 246 P.3d 877, 889-890
(2011): "Simply stated: labels matter. The marketing industry is based on the premise that labels
matter, that consumers will choose one product over another similar product based on its label
and various tangible and intangible qualities they may come to associate with a particular source.
(E.g., FTC. v. Proct er & Gamble Co. (1967) 386 U.S. 568,572, 87 S.Ct. 1224, 18L.Ed.2d 303
[noting the central role of advertising and sales promotion in generating market share, where the
competing products are functionally identical].) An entire body oflaw, trademark law (see, e.g.,
15 U.S.C. § 1051 et seq. [Lanham Act]) , exists to protect commercial and consumer interests in
accurate label representations as to source, because consumers rely on the accuracy of those
representations in making their buying decisions." (Bracketing in original.)
6
28
Plaintiffs Opposition to Defendants ' Special
Motion to Strike
6
16-CV-009 35-R
1
b.
2
Defendants erroneously claim the Complaint is "based on" defendants' speech about the
Defendants incorrectly describe the speech that the Complaint is "based on"
3
ratings - not the actual ratings assigned to specific films. Defendants incorrectly assert that the
4
speech that the Complaint is "based on" consists of defendants' public statements, or statements
5
in defendants' internal written rating rules, about the rating system. MTD at 2, 4-5, 12 and 15-16.
6
.
.
However, defendants' speech in any press release or in defendants' internal written rules
7
about the rating system is not the conduct or speech that is targeted by the Complaint and not the
8
speech that the claims are "based on." The Complaint does not assert defendants are liable for
9
their public discussion, press releases, or statements about the rating system, or any statements by
10.
defendants made as part of any public debate about the general subject of whether films with
11
tobacco imagery should or shouldn't be rated any particular way. The Complaint is not "based
12
on" defendants' expressions of opinions about anything relating to the rating system.
13
But the Motion repeatedly quotes from a May 2007 press release in which defendants
14
made one public statement about their rating system and their response to public health concerns
15
about tobacco imagery in youth-rated films. But that is no part of plaintiff's claim. At the risk of
16
repetition, the speech that the claims are "based on" is the certification trademarked ratings
17
assigned to the individual films with tobacco imagery startin g in 2012 (Compl. ,r4), not
18
defendants' statements in a press release years earlier about their refusal to change their ratings in
19
response to the experts' recommendations they had solicited (see Compl. ,J63). The claims here
20
are like scores of other consumer protection cases that are based on claims that the labels attached
21
to a product, or advertisements for a product, are false and misleading.
22
Nor can defendants plausibly suggest that anything having to do with their rating system -
23
- either the formulation of the ratings, or the actual rating of particular films -- is in furtherance of
24
any ''public discussion" about ratings. To the contrary, defendants' written rules preclude any
25
public debate about either the fo rmulation of the rating rules or the rating of any particular film.
26
And defendants' rules require that even the discussion of the formulation or revision of the rating
27
criteria, and the decision-making regarding the rating of individual films, will be conducted by
28
Plaintiff's Opposition to Defendants' Sp ecial
Motion to Strik e
7
16-CV-00935-R
1
defendants in total secrecy. 7
2
Defendants also incorrectly assert , repea tedly, that the claims target, or are "based on,"
3
defendants' opinions and beliefs - that they do not believe that a mandatory R rating for films
4
with tobacco imagery is appropriate. MTD at 2-3, 5-6, 12, 14-16, 18-19, 21, and 23-24.
5
However, the claims are not based on defendants' opinions or beliefs about what the appropriate
6
rating should be for films with tobacco imagery. The claims are that the PG-13 certification
7
ratings assigned to films featuring tobacco imagery are false and misleading, and are negligent ly
8
assigned, because exposure of children to tob acco imagery in films has been scientifical ly proven
9
to cause children to become addicted to nicotine , develop tobac co related diseases and kill them -
10
at current rates, it will kill one million children. Complaint i!12-6, 50- 54, 86-88, 92, 93, and
11
107-110.
12
The fact that the soft drink trade association in our hypothetical may entertain delusional
13
and deadly beliefs and opinions that it would be appropriate to affix labels to the soft drink
14
bottl es that its mem bers sell representing that the contents are suitable for children to drink when
15
they know one of the ingredients will kill one million children , does not mean the consumer's
16
claim against the trade association is based on the trade associations' opinions and beliefs
17
regarding whether the label is appropr iate or not. It is based on whether or not the label is false.
18
The speech that is the target of the Complaint, the speech the Comp laint's claims are
19
actually "based on" - for purposes of the first step of the anti-SLAPP analysis - is the false and
20
misleading PG-13 certification trademarked rating assigned to the ten films listed in the
21
22
23
24
25
26
27
28
7
See, Complaint, Ex. 1: the Rater s' identities are secret (Art. I, E.); consultations by the
Chairperson with the film producer or distributor regarding the potential rating must be kept
confidential (Art. II, Sec. 2., B.); all communication between the MPAA and the representative of
the film submitted for rating must be treated as confidential at all times (Art. II, Sec. 2., D.); the
raters' bal lots are treated at all times as confidential and not disclosed outsid e of the MPAA (Art.
II, Sec.2, E.); members of the Appeals Board including up to three unidentified designated
outside, non-voting memb ers, must treat all appea l proceedin gs as confidential and may not
discuss appeal proceedings except with designated members of the :MPAA (Art. IV, Sec. 2, E.);
representatives of the unidentified, designated observer organizations may observe the appea l but
may not participate and may not speak or vote in the appeal proceeding (Art. IV, Sec. 4., D.); no
part of the appeal may be recorded or transmitted (Art. IV, Sec. 4., E.); the Appeals Board votes
by secret ballot (Art. IV, Sec. 4., R).
Plaintiff s Oppo sition to Defendants' Special
Motion to Strike
8
16-CV-00935-R
1
Complaint, and the many other films with tobacco imagery that are also rated PG-13. Complaint
2
,~ 2--6, 50-54, 86-88, 92, 93, and 107-110.
Plaintiff's claims are not "based on" protected speech on a "public issue"
3
c.
4
Defendants cannot satisfy their burden to show that the claims are based on speech on a
5
"public issue" under the first step of the anti-SLAPP analysis. As described below, the PG-13
6
rating certificate or seal number 49732 (or any of the other nine certification trademarked seals or
7
certificates) is not speech on a public issue. The PG-13 certification assigned to a particular film
8
is not an expression of any opinion about the general subject of whether films with the F*** word
9
should or shouldn't be certified as appropriate for children under seventeen, nor is it an
10
expression of any opinion on the general subject of whether films with tobacco imagery should or
11
shouldn't be certified as appropriate for children under seventeen. While public statements or
12
press releases expressing opinions about the general subject of what film content should or
13
shouldn't be certified as appropriate for children under seventeen may be speech about a "public
14
issue," the certification trademarked rating seal or certificate assigned to specific films is not
15
speech on a "public issue" as defined by the anti-SLAPP law.
16
To plaintiffs knowledge there is only one reported case involving an anti-SLAPP motion
17
filed in response to claims that are "based on" defendant's use of a certification trademark. All
18
One God Faith, Inc . v. Organic & Sustainable Indus. Standards, Inc., 183 Cal. App. 4th 1186,
19
107 Cal. Rptr. 3d 861, (2010). The case is uncited in defendants' papers. In All One God Faith,
20
plaintiff sued defendant OASIS (a commercial trade association) for certifying certain products
21
with its "Made with Organic Oils" or "Organic" certification trademark and authorizing its
22
members to use the mark to sell products, even though the products contained cleansing agents
23
made from nonorganic material that has been hydrogenated and/or sulfated, and preserved with
24
synthetic petrochemicals. Id. at 1192-93. OASIS moved to stiike the complaint pursuant to
25
§ 425.16, arguing that it had been sued for its "opinion" as to what makes a personal care product
26
"organic" or "the articulation and dissemination of the ['OASIS Organic' ] standard." Id. at 1202.
27
OASIS argued that the plaintiffs claims challenged speech in connection with a public issue
28
Motion to Strike
9
l 6-CV-00935-R
1
because "the speech was made during the course of an active public debate on the issue, a debate
2
joined by governmental, commercial and consumer interests; the resolution of the issue will
3
affect large numbers of people beyond the direct participants; the speech was deve loped with
4
public input." (Id.)
The court in All One God Faith disagreed, denying the anti -SLAPP motion and holding
5
6
that a claim based on speech consisting of the use of a certification trademark, in contrast to
7
public discussion about the certification trademark or public discussion regarding the process of
8
formulating ( or revising, or refusing to revise) the certification standards or criteria, is not "based
9
on" protected speech under the first step ofthe anti-SLAPP analysis. Id. at 1200. The court
10
explained that the "public interest " component of§§ 425.16 (e)(3) and (4) is met only when ·'the
11
statement or acti~ity precipitating the claim involved a topic of widespread public interest" and
12
··the statement ... in some manner itself contribute[s] to the pu blic debate." Id. at 1202.
The court then found that the certification did not contribute to any publi c debate:
13
14
Here, unlike the conduct at issue in Lieberman , the articulation of the OASIS
standard will nec essarily be complete before OASIS certifies any memb er
product. OASIS, and our dissenting colleagu e, fail to show how the applicatio n of
an "OASIS Organic" seal on a particular product helps to advance or foster a
debate that will have already occurred on the meaning of "organic" as used in the
·'OA SIS Organic" seal, or that it will in some fashion contribute to a broader
debate on the meaning of the term "organic." The "OAS IS Organic" seal, when
viewed by a consumer on a particular product, is mer ely a representation
regarding the produ ct's ingredients and quality .... While the existe nce of some
standard may be a sine qua non to creation of a cert ification mark, the "OAS IS
Organic" seal itsel f does not include any discussion of what the standa rd is, so as
to encourage or contribute to public debat e on the issue ... The purpose of the
" 'OASIS Organic' seal" is to promote the sale of the product to which it is
affixed , not the standard or its elements. 8 Thus , we reject OASIS's claim that by
15
16
17
18
19
20
21
22
23
24
25
26
27
8
"As the dissent notes , certification marks, such as the Good Hou sekeep ing and Underwriters
Laboratori es seals of approval provide product information to consumer s which 'saves bu yers the
trouble of inve stigatin g product s themselv es and the risk of trying untested produ cts.' (Dis. opn.
post, p. 890, fn. 8; see Consolid ated Metal Prod. v. Amer. Petro. Ins titute (5th Cir. 1988) 846 F.2d
284, 296.) It is the marks them selves, as representations of quality, upon which consumers rely in
purchasing decisions, and the well-established reputations of the entities which authori ze them ,
not the standards upon which the produ ct certifications are based. We are not per suaded that
many, if any, consumers th emse lves investigate the basis for an Und erwriter1s Laboratory label
28
Plaintiff's Oppo sition to Defendants' Special
Motion to Strike
10
16-CV-009 35-R
1
2
3
certifying a member product to use its seal, it speaks with an educational purpose
or contributes to an ongoing public debate about organic standards. [Note:
Footnote 16 from the quoted material appears in this brief as Footnote 8 to this
brief.]
Here, like in All One God Faith, the certification trademark, the PG-13 rating, "does not
4
include any discussion regarding what the standard is, so as to encourage or contribute to public
5
debate on the issue." Id, at 1204, 875. Nor does it speak with an educational purpose or
6
contribute to an ongoing public debate about rating standards. Defendants certainl y do not show
7
how the application of a registered PG-13 certification trademark rating on a particular film helps
8
to advance or foster a debate that will have already occurred on the meaning of the "PG-13" mark
9
or that it will in some fashion contribute to a broader debate on the meaning of the term "PG-13."
10
The PG-13 certification trademark rating is merely a representation regarding the film's content ,
11
material , quality, appropriateness and suitability and is intended to induce the purcha se of tickets
12
to the film, i.e, the purpose of the PG-13 certification trademark rating is to promote the sale of
13
the film to which it is assigned and affixed, not the standard or its elements.
14
In addition, even if the rating were simply a product label, rather than a registered
15
certification trademark, it would make no difference for anti- SLAPP analysis : The courts have
16
consistently concluded that false and misl eading speech consisting of product labels or
17
advertisements containing statements regarding the particular qualities, content or safety of a
18
particular product, designed to sell or promot e a specific product, is commercial speech that does _
19
not satisfy the requirement tha! the challenged speech be in furtherance of a "public issue or
20
public interest."
21
In Trimedica, supra ., the Court considered an anti-SLAPP m otion in which defendant
22
argued that the allegedly false statements about the specific properties and efficacy of its product
23
qualified as speech about a "public issue or public interest." The Court rejected defendants'
24
25
argument that the challenged speech was about dietary supplements that are the subject of public
interest and held that the claims were bas ed upon misr epresentatio ns regarding the specific
26
27
upon a produ ct, or offer comments on the testing protocols used to achieve it." All One God
Faith at 1204, n. 16.
28
Motion to Strike
11
l 6-CV-00935-
1
properties and benefits of the particular product which was not a matter of general public interest
2
within the meaning of the anti-SLAPP statute. Trimedica, 107 Cal. App. 4th at 601. ("As
3
support, Trimedica cites regulations of herbal supplements by the Federal Trade Commission and
4
the Food and Drug Administration pursuant to acts of Congress. Yet Trimedica's speech is not
5
about herbal supplements in general. It is commercial speech about the specific properties and
6
efficacy of a particular product, Grobust. Ifwe were to accept Trimedica's argument that we
7
should examine the nature of the speech in terms of generalities instead of specifics, then nearly
8
any claim could be sufficiently abstracted to fall within the anti-SLAPP statute.") Id., at 601.9
9
In Nagel v. Twin Labs., Inc!., 109 Cal. App. 4th 39, 134 Cal. Rptr . 2d 420 (2003), the Court
1o
held that product labels and similar online statements regarding the qualities of a dietary
11
supplement that were alleged to be false and misleading, constituted commercial speech and not
12
speech protected under the anti-SLAPP "public issue" or "public interest" requirement. 10
I
13
9
21
The Court in Trimedica gave an apt illustration (Id at 601):
"CJC suggests a hypothetical regarding false statements made in the course of a real property
sale. Blackacre sells a house to Whiteacre, and Whiteacre sues, claiming defendant
misrepresented the square footage . Blackacre brings a special motion to strike, claiming his
speech involves a matter of public intere st, because millions of Americans live in houses and buy
and sell houses . CJC correctly suggests that applying the anti-SLAPP statute in such a case would
be absurd.
"This case is no more about the general topic of herbal supplements than the hypothetical
above is about the general topic of buying and selling houses. tiie lawsuit in the hypothetical is
about the specific topic of whether Blackacre misrepresented the house's square footage to
Whiteacre. The topic of this lawsuit is whether Trimedica misrepresented the specific properties
and benefits of Grobust. Neither is a matter of general public interest within the meaning of the
statute."
22
10
14
15
16
17
18
19
20
23
24
25
26
27
In Nagel, the Court made the distinction clear: "Second, while matters of health and weight
mana gement are undeniabl y of interest to the public, it does not necessarily follow that all lists of
ingredients on labels of food products or on the manufacturers' Web sites are fully protected from
legal challenges by virtue of section 425.16. 'Advertisers should not be permitted to immunize
false or misleading product information from government regulation simply by including
references to public issues.' (Bolger v. Youngs Drug Products Corp., supra , 463 U.S. at p. 68,
103 S.Ct. 2875.) Here, the list of Ripped Fuel's ingredients on the bottle labels and on Twin Labs'
Web site was not participation in the public dialogue on weight management issues; the labeling
on its face was designed to further Twin Labs' privat e interest of increasing sales for its products.
(Ericsson GE Mobile Communications , In c. v. CS.I Telecommuni cations Engineers (1996) 49
28
Plaintiffs Oppo sition to Defendant s' Speci al
Motion to Strike
12
16-CV -00935-
1
Numerous cases are to the same effect: Jewett v. Capital One Bank, 113 Cal. App. 4th
2
805, 6 Cal. Rptr. 3d 675 (2003), as modified on denial ofreh'g (Dec. 22, 2003), (rejecting
3
defendants' argument that credit card solicitations should be provided the protections of section
4
425.16 merely because credit card debt was a matter of general public interest); Mann v. Quality
5
Old Time Serv., Inc,., 120 Cal. App . 4th 90, 111, 15 Cal. Rptr. 3d 215,227 (2004) ('"Ifwe were to
6
accept [defendants'] argument that we should examine the na~e of the speech in terms of
7
generalities instead of specifics, then nearly any claim could be sufficiently abstracted to fall
8
within the anti-SLAPP statute"); World Fin. Grp., Inc. v. HEW Ins . & Fin. Servs., Inc., 172 Cal.
9
App. 4th 1561, 92 Cal. Rptr. 3d 227 (2009) , as modified (May 7, 2009); and L.A. Taxi Coop., Inc.
IO
v. lndep . Taxi Owners Ass'n of Los Angeles, 239 Cal. App. 4th 918,929, 191 Cal. Rptr. 3d 579,
11
587 (2015), review denied (Nov. 10, 2015).
12
These cases demonstrate that even in the absence of the use of a registered certification
13
trademark , the type of speech that is target of the 'Complaint here, the rating assigned to each
14
film, is precisely the type of speech that has repeatedly been held to be commercial spee ch, and
15
not speech in furtherance of a publ ic issue or public interest within the meaning of the anti-
16
SLAPP law.
17
The fact that the speech targeted here involves defendant s' use of registered certifi cation
18
trademarks only serves to unders core that defendants cannot satisfy their burden to demonstrate
19
that the purely commercial speech in this case is speech on a matter of public interest or a public
20
issue und er the first step of the anti-SLAPP analysis. Registered certification trademarks, that is,
21
the ratings that the claims in this case are "based on," are quint essentially commercial speech, not
22
speech on a publi c issue to which the anti-SLAPP law was meant to apply.
23
24
25
The cases cited by defendants discussing the "conduct in fortheran ce" requirement (MTD
at 8-10) are all distinguishab le for multiple reasons.
DuPont Merck Ph arm. Co. v. Superior Court, 78 Cal. App. 4th 562, 92 Cal. Rptr. 2d 755
26
27
28
Cal.App.4th 1591, 1602-1603, 57 Cal.Rptr.2d 491.) Twin Labs ' commer cial speech was not
made 'in connection with a public issue ' as that phrase is used in section 425.16. The anti-SLAPP
statute doe s not require dismissal ofNage l's lawsuit ." Id. at 47-48 .
Plaintiff s Op position to Defendant s' Special
Motion to Strike
13
16-CV-009 35-R
1
(2000), as modified (Jan. 25, 2000), is in.apposite because it involved claim s based on both
2
lobbying and political activities before regulatory and legislative bodies that are treated separately
3
under§ 425.16(e)(l) and (2), and also commercial speech that was inextricably intertwined with
4
the petitioning and lobbying speech. The petitioning and lobbying sections of the anti-SLAPP
5
law at stake in DuPont d~ not include the separate public interest or public issue requirement th at
6
applies to the speech in this case because speech involving petitioning the government, lobbying
7
and other similar political expression is entitled to greater protection than commercial speech.
8
Defendants make no argument that the claims here are "based on" any such petiti oning or
9
lobbying conduct. DuPont was distinguished for this reason in the cases discussed above
10
denying an anti-SLAPP motion wher e, as here, the complaint was based solely on pure
11
commercial speech. Jewet, at 814, Nagel, at 428, and All One God Faith , at 1209. Defendants
12
also cite DuPont for the proposition that the public interest requirement is satisfied here because
13
the ratings in this case affect a large number of parents. The statement in DuPont that the publi c
14
interest requirement turns on the magnitude of the consumer fraud, that is, whether the false
15
commercial speech affects a larg e number of consumers and invo lves life-threatening statements ,
16
rather than a small number of consumers on matters that are not life-thre atenin g, has been
17
di scredited by virtually every court that has since considered the issue. As the Court stated in
18
Scott v. Metabolife Int'!, Inc., 115 Cal. App. 4th 404,423, 9 Cal. Rptr. 3d 242,256 (2004) ("Ifwe
19
were to conclude that was all that was necessary, our conclusion wo uld pro duce the anomalous
20
result of giving more protection to advertisers who threat en a larg er segment of the public with a
21
more deadly problem. This cannot be the purpose of a statute that was designed "to encourage
22
continued participation in matters of public significance, and [ensure] that this participation
23
should not be chilled through abuse of the judi cial proce ss."). 11
24
Defendants also rely upon California Pub. Employees' Ret. Sys. v. Moody's Inv'rs Serv.,
25
Inc., 226 Cal. App. 4th 643, 172 Cal. Rptr. 3d 238 (2014), review denied (Sept. 10, 2014)
26
("Ca/PERS''). However, Ca/PERS is distinguishable for several reasons. First, Ca/PERS
27
28
ll See also, Martin ez v. Metabolife Int'!, Inc., 113 Cal. App. 4th 181, 193, 6 Cal. Rptr. 3d 494, 503
(2003); and All One God Faith, at 1209, 879.
Plaintiffs Opposit ion to Defendants' Special
Motion to Strike
14
16-CV-00935-R
1
involved a claim based on a combination of protected - noncomme rcial - public speech about an
2
issue of public interest and unprotected commercial speech. The defendant in Ca/PERS,
3
McGraw- Hill, was a publisher - engaged in typical noncommercial speech . In addition, the
4
plaintiff alleged the claim was based on speech published in third party publications by other
5
publishers - Bloomberg and Reuters - that is, noncommercial speech. Thus, the Court described
6
the speech that was the target of the claims in CalPERS as consisting of both protected
7
noncommercial speech and non-protected commercial speech: "w here, as here, the cause of
8
action alleges both protected and non-protected activities." Id at, 250, 659. In cases where the
9
complaint is based upon both protected "public issue" speech and non-protected commercial
1o
speech, the "public issue " prong of an anti-SLAPP motion will be satisfied only where the
11
protected public issue speech is more than merely incidental or collateral to the ooprotected
12
commercial conduct. In Ca/PERS, the Court rejected plainti ff's assertion that the protected
13
public issue speech was merely incidental to the unprotected commercia l speech and thus held
14
that the defendant had satisfied the first step in the anti-SLAPP ana lysis. Id. at 250, 659.
15
Here, however, the Complaint is based solely on defendants' commercia l speech-the
,r,r107-
16
certification trademark ratings assigned to those films with tobacco imagery. Complaint
17
110. In addition, in contrast to Ca/PERS, defendants here are not newspapers, booksellers, or any
18
manner of publishers engaged in the type of noncommercial speech that is deserving of the core
19
protections of the First Amendment, nor are the claims here based on speech publi shed by news
20
agencies such as Bloomberg or Reuters. Defendants here are a trade association and its members
21
attempting to persuade the movie going consumer, in particular , parents, to buy its members'
22
products by using certification trademarks in connection with the promotion and sale of its
23
members' products. Complaint
,r,r56, 67-68.
24
Defendants also claim that their certification trademarked movie ratings have a greater
25
claim to being conduct in furtherance of protected noncommercial speech than ratings of diet
26
supplements, credit cards or other products because the subject matter of movie ratings - movies
27
- is itself protected noncommercial speech. (MTD at 10.) Defendants' argument that speech
28
Motion to Strike
15
16-CV-00935-R
1
about movies is entitled to special or greater protection than speech about other products and,
2
therefore, that false commercial speech about movies is immunized from the consumer protection
3
and other state tort laws by the anti-SLAPP law, was previously proposed by one of the
4
defendants here, and specifically rejected. Rezec v. Sony Pictures Entm't, Inc., 116 Cal. App. 4th
5
135, 141-42, 10 Cal. Rptr. 3d 333, 338-39 (2004), as modified (Feb. 26, 2004) ("Sony argues
6
that, because the films themselves are noncommercial speech, so are the advertisements. Under
7
Sony's absolutist approach, every film advertisement, no matter how false, would be outside the
8
scope of consumer protection laws. We reject that position.") (citations and footnote omitted).
9
The argument was raised again, also by another one of the defendants here, and was similarly
10
rejected in Dyer v. Childress, 147 Cal. App. 4th 1273, 1283-84, 55 Cal. Rptr. 3d 544, 550-51
11
(2007). See, also, L.A. Taxi Coop., Inc. v. Indep. Taxi Owners Ass'n of Los Angeles, 239 Cal.
12
App. 4th 918,930, 191 Cal. Rptr. 3d 579,588 (2015), review denied (Nov. 10, 2015).
13
Since the speech that the Complaint is "based on" here is solely commercial speech,
14
defendants have failed to establish that the speech is in furtherance of a public issue and, on that
15
basis alone, the anti-SLAPP motion should be denied, without further consideration of the
16
adequacy of the pleadings to state a claim. We nonetheless address that adequacy not only in
17
response to the Rule 12(b)(6) portion of the motion, but, concurrently, to provide a second,
18
independent basis upon which the anti-SLAPP motion should be denied.
19
IV.
20
21
22
23
24
25
26
27
28
Plaintiff has demonstrated a probability of prevailing on the merits
A.
The First Amendment does not provide immunity for defendants'
commercial speech
Defendants argue that the speech the claims are based on is pure noncommercial speech -expressions of defendants' opinions, entitled to the full protections of the First Amendment.
Therefore, defendants assert that plaintiff cannot demonstrate a probability of prevailing on his
claims under the second step of the anti-SLAPP law. MTD at 11-13. But, defendants' First
Amendment arguments are without merit.
The speech that the claims are based upon are the certification trademarked ratings
assigned to specific films with tobacco imagery. Complaint ,r107. Those certification
Motion to Strike
16
l 6-CV-00935-R
1
trademarked ratings are pure commercial speech. Defendants admit, for purposes of the Motion,
2
all of the allegations of the Complaint including that the PG-13 certification trademarked ratings
3
of films with tobacco imagery are false and misleading and fail to disclose life threatening health
4
and safety warnings. False and misleading commercial speech is not entitled to First Amendment
5
protection or immunity. Kasky v. Nike, Inc,., 27 Cal. 4th 939, 45 P.3d 243 (2002), as modified
6
(May 22, 2002). All One God Faith, at 876-878,
7
Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 771, 96 S. Ct. 1817, 1830, 48 L. Ed. 2d
8
346 (1976) ("Untruthful speech, commercial or otherwise, has never been protected for its own
9
sake."); Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n of New York, 447 U.S. 557,563,
1205-1208; Virginia State Bd. of Pharmacy v.
10
100 S. Ct. 2343, 2350, 65 L. Ed. 2d 341 (1980) ("Consequently, there can be no constitutional
11
objection to the suppression of commercial messages that do not accurately inform the public
12
about lawful activity. The government may ban forms of communication more likely to deceive
13
the public than to inform it."); Bolger v. Youngs Drug Products Corp., 463 U.S. 60, 103 S. Ct.
14
2875, 77 L. Ed. 2d 469 (1983).
Defendant MPAA's applications seeking to register its ratings as federal certification
15
16
trademarks state, under oath, that the certification trademarked ratings may lawfully be regulated
17
by Congress because they are used in the ordinary course of trade. See 15 U.S.C.
18
§§I051(a)(3)(C) and1054; Ex. 1. 12 In addition, the MPAA has sought to protect its commercial
19
rights under the Trademark Act for its certification trademarked ratings many times over the last
20
twenty-five years including three recent cases before the United States Patent and Trademark
21
Office ("USPTO") one of which was filed on February 19, 2016, six days before the Complaint
22
was filed in this case. All of those pleadings describe defendants' use of the certification
23
trademarked ratings as commercial speech - certifying the content of motion pictures in
24
connection with thousands of films, certification trademarked ratings seen by millions of people
25
every day in theaters in connection with the sale of more than a billion movie tickets sold every
26
year. See, Ex s. 2-4 .
27
28
12 All
"Ex. " references are to Exhibits attached to the Declaration of David Schachman in
Support of Plaintiffs Opposition to Defendants' Special Motion to Strike.
Motion to Strike
17
I 6-CV-00935-R
1
In yet another case, Motion Picture Ass'n of Am., Inc. v. Respect Sportswear, Inc., 83
2
U.S.P.Q.2d 1555 (P.T.O. Apr. 13, 2007), the MPAA sought to cancel a sportswear
3
manufacturer's registration and use of a similar trademark: "Rated R Sportswear." The MP AA
4
claimed that allowing the manufacturer to register and use its trademark would damage the
5
MP AA and its members because it would likely cause consumer confusion and would dilute the
6
value of the MPAA's certification trademarks. The MPAA presented evidence to prove that the
7
MP AA and its members had expended enormous resources to create consumer recognition of its
8
certification trademarked ratings and, as a result, the MPAA's certification trademarks were so
9
well known and recognized by consumers that the certification trademarked ratings should be
10
recognized as "famous" trademarks as defined by the Trademark Act. Based upon the MPAA's
11
evidence describing the magnitude of the defendants' commercial use of the trademarks and
12
consumers' recognition of the defendants' certification trademarks, the Trademark Trial and
13
Appeal Board held that the certification trademark was "famous," found that consumers would
14
likely be confused, and granted the MPAA's request to cancel the registration of the offending
15
trademark.
16
Defendants' registration of its certification trademarked ratings, use of its certification
17
trademarked ratings, and repeated court filings to enforce and protect its certification trademarked
18
ratings against consumer confusion and dilution claiming that these defendants will be damaged
19
by such consumer confusion or dilution, are utterly inconsistent with their attempt in the Motion
20
to claim that the certification trademarked ratings are pure noncommercial speech entitled to full
21
First Amendment protection.
22
In addition, defendants' internal rules makes pellucid that the certification trademarked
23
ratings are commercial speech: "CARA rates motion pictures intended to be exhibited and
24
distributed commercially to the public in the United States to provide parents information
25
concerning the content of those motion pictures to help them determine each motion picture's
26
suitability for viewing by their children." Complaint, Ex. 1, Art. I, A.
27
Defendants' entire discussion of whether the certification trademarked ratings in this case
28
Motion to Strike
18
l 6-CV-00935 -R
1
are protected opinion ·simply ignores the well-established test for differentiating actionable
2
representations of fact and non-actionable puffery or opinion/or commercial speech. The te st
3
has been applied in scores of reported cases analyzing whether product labels and advertising are
4
actionable commercial speech, on the one hand , or, non-actionable opinion , on the other, but
5
those cases are not discussed or mentioned in the Motion .
Instead of recognizing the applicability of the commercial speech cases , and attempting to
6
7
analyze whether the speech in this case constitutes actionable represent ations under the
8
appropriate standard for commercial speech, defendants, without explicitly saying so, attempt to
9
apply a different test (a t est, not surprisingly, more favora ble to defendants), taken from a line of
10
cases that has absolutely nothing to do with the claims asserted in this case. The only cases
11
defendants rely upon for their argument that the certification trademarke d ratin gs assigne d to
12
films with tobacco imagery are expre ssion of opinions, not actionab le representations, are
13
defamation and noncommercial speech cases brou ght agains t newspapers or publishers . MID at
14
11-13. In defamation and noncommer cial speech cases agai nst pub lisher s, the test for
15
determining if a statement is defamatory or mer ely non-d efamatory opinion is more
16
accommodating to defendant s than claims, as here , involving comm ercial speech . None of the
17
cases cited by defendant s is relevant to plaintiff' s claims. Plaintiff has not asserted any
18
defamation or noncommercial speec h claim.
19
As discuss ed below, under th e applicable standard s governing commercial speech, the
20
certifi cation trademark ratings that are the subj ect of the Comp laint here are actionable
21
represent ations, rather than non-acti onable opinions.
13
22
23
24
25
26
13
27
28
Ind eed, as is discussed at pp. 22-23 below, even if the certification trademarked ratings were
considere d opinions, the certific ation trademark ed ratings here are still act ionable false and
m isleadin g opinion s under well-esta blished California law governing comme rcial speech.
Plaintiff s Oppos ition to Defendant s' Special
Motion to Strike
19
16-CV-009 35-R
B.
Plaintifrs negligent misrepresentation Claim (Count VII) pro.perly states a
claim.
1.
The false and misleading representations of fact or actionable
opinions and omissions that are alleged
1
2
3
4
5
The Complaint is based on the false and misleading representations and the failure to
disclose life threatening health and safety facts .in the labels or certification trademarked ratings
defendants assign to films with tobacco imagery. Complaint
,r,r2-6,
107-110.
6
The PG-13 certification rating is a false and misleading representation , as applied to films
7
8
with tobacco imagery, that the film is suitable for children under seventeen unaccompanied by a
parent or guardian. This representation is false and misleading because it is a scientific fact, as
9
defendants are fully aware, that exposure of children and adolescents to tobacco imagery in films
10
causes children to become add icted to nicotine, develop tobacco related diseases , and kills them,
11
by the tens of thousands. In addition , the PG-13 rating falsely and mis lead ingly represents,
12
>
"Some Material May Be Inappropriate For Children Under 13" when, in fact, as defendants
13
know, exposure of children and adolescents to tobacco imagery in films has been scientifically
14
proven to cause nicotine addiction, tobacco related diseases and premature death. Therefore,
15
16
17
18
films with tobacco imagery contain materia l that is, not may be, inappropri ate for children.
Complaint, Par. 2-5, 45-54 , 60-66, 92-93, 98- 100.
In addition, the Complaint is also based upon two types of omissions. The ratings never
disclose life threatening health and safety-warnings that exposure of youth to toba cco imagery in
19
films has been scientifically proven to cause nicotine addictio n, toba cco related diseases and
20
premature death . In addition, defendants fail to di sclose the presence of tobacco imagery in the
21
descriptor portion of the film rating for approximate ly 88% of the films that contain tobacco
22
imagery. Complaint
,r,r97, 98 and 109.
23
2.
The representations in question are actionable representations of fact
24
Scores of cases in federal and state courts have clearly estab lished and applied the test to
25
26
differentiate actionable statements of fact from non- actionabl e opinion for common law claims of
negligent mi sreprese ntation and fraud , and claims under the California UCL and FAL statutes. If
27
the statement is capab le of bein g proven false or reasonably interpreted as a statement of
28
Plaintiff's Oppositio n to Defendant s' Special
Motion to Strike
20
l 6-CV -0093 5-R
1
objective fact it is an actionable statement of fact. Descriptions of specific or absolute
2
characteristics of a product are actionable statements of fact. If, however the statement is a
3
general, vague and unspecified assertion that does not say anything about the specific
4
characteristics or components of the product, it is a non-actionable opinion. If the stateme nt is
5
sufficiently specific such that it is capable of inducing consumer reliance it is an actionable
6
statement of fact. Bohac v. Gen. Mills, Inc., No. 12-C V-05280-WHO, 2014 WL 1266 848, at *5-
7
6 (N.D. Cal. Mar. 26, 2014). Cortina v. Goya Foods, Inc., 94 F. Supp. 3d 1174, 1193 (S .D . Cal.
8
2015). ~ Cases applying the test for actionable representations and non-a ctio nab le opinions are
9
collected below.
.
10
'
14
14
Examples of actionable representations of fact or opinion: Cortina v. Goya Foods, Inc., 94 F.
Supp.
3d 1174, 1193 (S.D. Cal. 2015) (beverage was "safe for consumption"); Bohac v. Gen.
11
Mills, Inc., No. 12-CV-05280-WHO, 2014 WL 1266848, at *6 (N.D. Cal. Mar. 26, 2014) (nature
12
valley granola bars were "100% NATURAL" and "All Natural") ; Goldsmith v. Allergan, Inc.,
No. CV 09-7088 PSG EX, 2011 WL 29 09313, at *5 (C.D. Cal. May 25, 2011) ("suitable" is
13
actionable stat eme nt of fact);ThermoLife Int'/, LLC v. Gaspari Nutrition Inc., No. 14-15180, 2016
WL 1460171, at *4 (9th Cir. Apr . 14, 2016) ("safe" ac tiona ble state ment of fact); Apodaca v.
14
Whirlpool Corp., No. SAC V 13-00725 NS, 2013 WL 647 7821, at *1 (C.D. Cal. Nov. 8, 2013) (a
15
product used "c ommer cial grade components"); Anunziato v. eMachines, Inc., 402 F. Supp. 2d
1133 (C.D. Cal. 20 05) (a product uses "brand-name comp onents" and are subjec t to the "mo st
16
stringent quality control test s"); Chacanaca v. Quaker Oats Co., 752 F. Supp. 2d 1111 (N.D. Cal.
2010) (granola bar was "w hol esome " when it had dangerous additives); Williams v. Gerber
17
Products Co., 552 F.3d 934 (9th Cir. 200 8) (" nutritious " food); Delacruz v. Cytosport, Inc., No. C
11-3532 CW, 2012 WL 1215243, at *l (N.D. Cal. Apr. 11, 2012) ("healthy fat" because the term
18
- was -susceptible to proof); Walter v. Hughes Commc'ns, Inc:.,682 F:Supp. 2d 1031 (N.D. Cal.
19
2010) (the service provide ''ty pical " although see min gly-vague, was actionable in the context of
measuring quantifiabl e intern et speeds); and Hauter v. Zogarts, 14 Cal. 3d l 04, 112, 534 P.2d
20
377 (1975) ("completely safe ball will not hit player ") ("The assertion that the Gizmo is
completely safe, that the ball will not hit the player, does not indicate the seller's subjective
21
opinion about the merits of his product but rather factually describes an important charac t eristic
of
the product. Court s hav e consiste ntly held similar promises of safety to be represent ations of
22
fact.").
23
Examples of non-actionable opinions: Vitt v. Apple Computer, Inc., 469 F. App'x 605, 607 (9th
24
25
26
27
Cir. 2012 ("durable ," "rugged," "built to withstand reasonable shock," "rel iable," and "high
perfonnance ") Vitt v. Apple Computer, Inc., 469 F. App'x 605, 607 (9th Cir. 2012) ("The distric t
court held that these statement s are general ized, non-ac tion ab le puffery because they are
" inh erently va gue and ge neralized terms " and ''not factual representations that a given standard
has been met."); Coastal Abstract Serv., Inc. v. First Am. Title Ins. Co., 173 F.3d 725 (9th Cir.
1999 ) ("too small " to handle customer's business needs) ; Cook, Perkiss & Liehe, Inc. v. N
California Collection Serv. Inc., 911 F.2d 242 (9th Cir. 1990) ("bes t techno logy" "better
28
Motion to Strike
21
I 6-CV -009 35-R
1
Defendants' certification trademarked ratings, under the applicable law, are actionable
2
representations of fact capable of being proven false and upon which consumers readily can and,
3
in fact, do rely.
4
Whether the representations are false can be easily established: if there is persuasive
.
.
5
evidence that exposure to tobacco imagery causes children to become addicted to nicotine,
6
develop tobacco related diseases and die prematurely, by the tens of thousands, the repre sentation
7
that the film is appropriate for children under seventeen without a parent or guardian is false. In
8
addition, the certification trademark rating states "Some Material May Be Inappropriate For
9
Children Under 13." The same scientific evidence (and the recommendations of virtually every
1O
public health and medical association in America and the chief law enforcement officers of thirty-
11
one states) will demonstrate that some material in these films - tobacco imagery - is completel y
12
inappropriate for impressionable children and adolescents because, at current rates, it will kill one
13
million of them . Representing that some material may be inappropriate, when defendants know
14
that the tobacco imagery is inappropriate (meaning that it will kill them), renders this
15
representation easily capable of being prov en false.
16
Moreover , by legal definition , and as a result of defendants' registration and subsequent
17
continual use of their certification trademarks , and defendants' repeated attempt to enforce the
18
certification trademarks in the USPTO,defendants cannot be permitted to now claimthat their
19
certification trademarked ratings are simply free floating non-actionable opinions.
20
In addition, defendants cannot plausibly claim that their certification trad emarked ratings
21
are not actionable representations of fact upon which a consumer could reasonably rely. The very
22
purpose of a certification trademark is to represent to purchasers that the goods or services
23
possess certain characteristics or meet certain qualifications or standards for the purpose of
24
25
(Footnote 14 continued from prior page)
26
27
customer service"); nSight, Inc. v. PeopleSoft, Inc., No. C-04-3836 MMC, 2005 WL 1287553, at
*1 (N.D. Cal. June 1, 2005) ("inferiorto defendants' services," "not professional inimplementing
[defendant's] software") .
28
Plaintiffs Opposition to Defendant s' Special
Motion to Strike
22
16-CV -00935 -R
1
inducing consumers to rely upon the certification to purchase the product. 15
2
Moreover, there can be no doubt that the certification trademarks worked precisely as
3
intended - to induce parents to rely on them. Every year since 1969 defendants have
4
commissioned a survey to find out whether parents rely on the certification trademarked ratings.
5
Those surveys have consistently shown that an overwhelming majority of parents in fact do rely
6
on defendants' certification trademarked ratings. For, example, in Motion Picture Ass'n of Am.,
7
Inc. v. Rated R Clothing, Inc., 646 F. Supp. 22, 23-24 (S.D.N.Y. 1986), the MPAA submitted its
8
annual survey to establish its remarkable success in obtaining parental reliance upon the MPAA's
9
certification trademarked ratings, and the MPAA argued that "its rating system is considered
IO
reliable because of public trust in its accuracy." Id. at 26. In defendants' press release
11
announcing the results of a 2015 survey, Joan Graves, defendants' Senior Vice President and
12
Chairperson of CARA, stated: "We are proud of the system that we have created, a system that
13
families everywhere have come to rely upon." Ex. 5. See also, Motion Picture Ass'n of Am., Inc.
14
v. Respect Sportsw ear, Inc., 83 U.S.P.Q .2d 1555 (P.T.O. Apr. 13, 2007) (finding defendants'
15
certification trademarks "famous.") 16 Relianc e cannot be credibly challenged.
Defendants' certification trademarked ratings are actionable statements of fact.
16
3.
17
18
19
20
Even if regarded as opinions, false and misleading opinions
are sufficient to state a claim for negligent misrepresentation
Under well-established law, even if defendants' certification trademark ratings were
regarded as "opinions," they are, nevertheless, a legally sufficient basis upon which to state
claims for negligent misrepresentation ( as well as for fraud and claims under the UCL and FAL).
21
22
15
23
24
25
26
27
28
The MPAA's internal rules state the purpose of the ratings is "to be used by parents to assist
them in determining whethe r the motion picture is appropriate for their children to see and
whether their children should be accompanied while seeing the motion picture." Complaint,~ 59.
16
Thus, Dan Glickman, the Chief Executive Officer of the MPAA, stated in his press release in
2007: "The MPAA film rating system has exist_ed for nearly 40 years as an educational tool for
parents to assist them in making decisions about what movies are appropriate for their children. It
is a system that is designed to evolve alongside modern parental concerns. I am pleased that this
system continues to receive overwhelming approval from parents, and is consistently described as
a valuable tool they rely upon in making movie-going decisions for their families." Complaint ,
Exhibit 5 at ECF page 5.
Motion to Strike
23
l 6-CV-00935-R
1
A false or misleading opinion is actionable if made by a person claiming to have superior
2
knowledge or special information concerning the subject matter or where it is express ed in a
3
manner implying a factual basis that does not exist. Doran v. Milland Dev. Co., 159 Cal. App. 2d
4
322,325, 323 P.2d 792, 794 (1958); Jolley v. Chase Home Fin., LLC, 213 Cal. App. 4th 872,
5
893, 153 Cal. Rptr. 3d 546, 563 (2013), as modified on denial of reh'g (Mar. 7, 2013). See also,
6
CalPERS where the Court held that the ratings involved in that case were actionable opinions.
7
CalPERS, at 661-665 and cases in footnote 14, above.
.
.
8
9
By obtaining and utilizing certification trademarks, defendants , by legal definition , claim
to have special information concerning the subject matte r, that they have a factual basis for
1o
certifying that they inspected the film, and that the film is appropriate for viewing by
11
unaccompanied children under seve nteen.
12
13
The Complaint is based on actionable opinions, even if it were assumed that the
certification trademarked ratings are not regarded as representations of fact.
4.
14
Defendants mischarac terize Plaintiff's allegation s of false
and misleading representation s.
15
Defendants incorrectly assert "Plaintiff's contention that a rating belo w R implies that a
16
17
movie will not contai n tobacco image s likewise fails" because ne gligent mi srepresentations
18
claims based solely on impl ied representations or nondisclo sures are legally insufficient. MID at
19
15; emphasis in origina l. However, the claim that the PG-13 rating is false and misleading is not
20
based upon any implied repr esentation about the content of the film - whether about tobacco
21
imagery or the use of the F*** word more than once or anything else. 17 The PG-13 rating
22
certifies that the film does not have any content that is inappropriate for unaccompanied chi ldren
23
under seventeen. Under defendants' rating system, if the film has any content that is unsuitabl e
24
17
25
26
27
The claim is not th at the PG-13 rating is impliedly false and m isleading because the film has
tobacco imagery - that there is an imp lied false and misleading repre sentation that PG-13 films
will not have any tobacco imagery; the claim is that if the film has tobacco imagery the PG-13
rating - that the film has no content that is inappropriate for unaccompanied children under
seventeen - is false and misleading becau se exposure of children to t obacco imagery has been
scientifica lly proven to cause nicotine addiction, tobacco related diseases and premature death.
28
Motion to Strike
24
16-CV-00935-R
1
for children under seventeen, the film may not be certified PG-13. The ten films listed in the
2
Complaint and the many other films with tobacco imagery are films that defendants certified
3
contained no content inappropriate for unaccompanied children under seventeen.
4
claims in the Complaint are not based on any implied repr esentations or solely on defendants'
5
nondisclosure of the fact that exposing children to tobacco image ry in youth rated films has been
6
scientifically proven to cause nicotine addiction , tobacco related diseases, and premature death.
7
18
Thus, the
Defendants also assert that "CARA has done pre cisely what it said it would do with films
8
with smoking imagery, and Plaintiff can point to nothin g false about CARA's public
9
statements. " 19 "And CARA has never said that it will give an R rating to every mov ie containing
1O
a single image of smoking. In fact, the oppo site is true. CARA has made clear it is not adopting
1l
a 'mandatory R' rating on all films that contain any smokin g. Thu s, the Complaint does not
12
plead and Plaintiff cannot establish any misrepr esentation ." MTD at 14-15 (citations omitt ed,
13
emphasis in original) .
14
Contrary to defendant s' claims , howeve r, the Complaint does not assert that defendant s
15
falsely repre sent ed (or promis ed) that they would rate tob acco imagery w ith the R rating even
16
th ough they never intend ed to do so and, in fact, did not do so. The Compl aint claims the PG- 13
17
ratings are false and misl eading , not that defendants falsely repr esente d that the y were going to
18
change the r ating s.
5.
19
20
21
Def endants fail to establish the absence of reasonable reliance
Defendant s erroneously claim that pl aintiff fails to pl ead reasona b_le relian ce on
defendant s' misreprese nt ations and omissions. MID at 18-1 9.
22
23
24
25
26
27
28
18
The ne gligence, fraud and UCL claim s here could be bas ed solely upon defe ndants '
nondi sclo sure of m aterial criti cal health and safety warnin gs. Wilson v. Hewlett-Packard Co.,
668 F.3d 1136, 1141 (9th Cir. 2012). In addition, the claim s here are based on false and
mi sleadin g misr epre sentations , and partial repr esentati ons, but suppression of the mat erial facts
that expo sure of childr en and adole scent s to tobacco imagery in films causes nicotine addiction,
tobacco r elated di seases and prem atur e death . Falk v. Gen. Motors Corp., 496 F. Supp. 2d 1088,
1094-109 5 (N.D. Cal. 2007) .
19
As describe d above, the Compl aint does not target defendants' publi c stat ement s about the film
rating system ; it targe ts the false and mi sleading rati ngs assigned to films with tobacco imagery .
Motion to Strike
25
l 6-CV -00935 -R
1
Plaintiff relied upon the defendants' certification trademarked PG-13 rating that the films
2
were appropriate for unaccompanied children under seventeen when he purchased tickets to the
3
ten listed films. If defendants had disclosed that exposure to films with tobacco imagery causes
4
children and adolescents to become addicted to nicotine, suffer tobacco-related diseases and die
5
prematurely and had disclosed ·that the ten films contained tobacco imagery, he would not have
6
purchased tickets to the films. Complaint ,r,r108 -109. Under the applicable law these facts are
7
sufficient to plead reliance under Rule 12(b)(6) standards. Kwikset Corp. v. Superior Court, 51
8
Cal. 4th 310, 326, 246 P.3d 877, 887 (2011); In re Tobacco JI Cases, 46 Cal. 4th 298, 326, 207
9
P.3d 20, 39 (2009); Ries v. Arizona Beverages USA LLC, 287 F.R.D. 523, 530-531 (N.D. Cal.
10
2012) (J. Seeborg).
11
Defendants argue that plaintiff bought tickets to ten movies over four years that contained
12
tobacco imagery and so, at some point, he must have realized that the films contained tobacco
13
imagery despite being rated PG-13. So, the argument goes, his continued purchase of tickets to
14
PG-13 films containing tobacco imagery demonstrates, as a matter oflaw, that he could not be
15
relying on the PG-13 rating as an indication that the film would contain no tobacco imagery.
16
MTD at 18-19.
17
However, once again, defendants misapprehend the actual claims asserted, this time to
18
make a reliance argument that does not apply to the claims asserted. The claims are not based
19
upon an implied or express statement that PG-13 rated films will contain no tobacco imagery.20
20
The claims are that the PG-13 certification of films with tobacco imagery falsely represents that ·
21
the film contains no contel}tthat is inappropriate for unaccompanied children under seventeen.
22
23
Plaintiff did not know that exposure of children and adolescents to films with tobacco
imagery had been scientifically proven to cause nicotine addiction, tobacco-related diseases and
24
25
26
27
20
Even as to defendants' misstatement of the claims, they have not established as a matter ofla w
that plaintiff did not reasonably rely. Thesier-Hendricks v. TJL Enterprises, In c., No.
LACV1500477JAKSSX, 2015 WL 10791893, at *4 (C.D. Cal. Aug. 3, 2015) (denying motion to
dismiss based upon the argument that no reasonable consumer could reasonably rely upon
defendants' representation after the consumer purchased the product five times).
28
Plaintiff's Oppo sition to Defend ants' Special
Motion to Strike
,
26
16-CV-00935-R
I
death. Complaint ,r,rI08-09. He was unaware of those material facts when he purchased tickets
2
to the ten listed films. 21 Without that critical information, known to defendants but not to him,
3
and even assuming he knew that a PG-13 rated film might contain tobacco imagery, plaintiffs
4
reliance upon defendants' certification that the film was suitable for children under seventeen was
5
reasonable (and it was certainly not unreasonable as a matter oflaw). Defendants have failed to
6
demonstrate that no reasonable person could conclude that plaintiff relied upon defendants' false
7
representations and omissions when he purchased tickets to the ten listed films. Keegan v. Am.
8
Honda Motor Co., 838 F. Supp. 2d 929, 960-961 (C.D. Cal. 2012).
9
The cases cited by defendants are distinguishable. Defendants cite In re Tobacco Cases II,
IO
240 Cal. App. 4th 779, 789, 192 Cal. Rptr. 3d 881,891 (2015), review denied (Dec. 9, 2015), and
II
Turcios v. Carma Labs ., Inc., 296 F.R.D. 638 (C.D. Cal. 2014), as examples of courts' finding a
12
lack of reliance. But those decisions came on a fully-developed record- not on a Rule 12(b)(6)
13
motion -- when it turned out that the plaintiff in fact knew the truth about that which he or she
14
claimed had been misrepresented. Here, plaintiff may have realized that the films contained
15
smoking imagery, but was never informed of the deadly effects of exposure of children to that
16
imagery. 22
17
Defendants' reliance upon Davis v. HSBC Bank Nevada, NA ., 691 F.3d 1152, 1163-1164
18
In her 2015 press release, the Chairperson of the MPAA's rating system stated to parents that
the ratings were intended to answer the question: "What would I want to know before letting my
child watch this film?" Ex. 5. At a minimum, one would think, a parent would want to know that
the movie contained tobacco imagery and that the Surgeon General of the United States had
concluded that exposure to such imagery would lead children to addiction, disease and premature
death. Yet that was not disclosed. Defendants clearly intended to conceal this material
information from parents while simultaneously spending billions of dollars promoting their
ratings and soliciting parents' reliance on those ratings by telling parents that the purpose of the
rating system is to give parents advance information regarding the content of films that is suitable
or not for children under seventeen.
22 The plaintiff in In Re Tobacco Cases II admitted during cross examination that she continued to
purchase Marlboro Light cigarettes for six years after learning the truth - that they were no less
haimful than full-flavored cigarettes. Id. at 787. In Turcios the court decided, based upon the
plaintiffs extensive testimony, that he purchased the product after knowing the truth - that the jar
of Carmex was not filled. The court found based upon his extensive testimony, that contrary to
his allegation, that he would have paid the same price for the jar even ifhe had he known the
entire Carmexjar was not filled. Id. at 643.
21
19
20
21
22
23
24
25
26
27
28
Motion to Strike
27
16-CV-00935-R
1
(9th Cir. 2012), highlights the lack of merit in their reliance arguments. In Davis, the plaintiff
2
alleged he was misled and that he would not have signed up for a credit card if he had known the
3
credit card required an annual fee. In Davis, the plaintiff electronically signed and accepted the
4
written application for the credit card, and the written application clearly and explicitly disclosed
5
the card required the paymen t of an annual fee. The court ruled, on a l 2(b )( 6) motion, after
6
recognizing that reasonable reliance is usually a question of fact for the jury , that no reasonable
7
person could conclude that plainti ff relied upon the nondisclosure of the annual credit card fee
8
because the plaintiff signed and accepted the written agreement without reading the disclosure
9
statement that stated there was an annual charge. Id. 1163-1164. Here, there was no disclosure;
1o
11
12
13
that is the point.
The Complaint sufficiently alleges reasonable reliance .
6.
The Complaint establishe s proximate causation.
Defendants' assertion that as a matter of law the Complaint fails to estab lish proximate
14
causation is based upon a misstat ement of the claims asserted in the Complaint. The Complaint
15
states that the false and misleading representat ions and omissions in defendants' certification
16
trademarked ratings proximately caused plaintiff to purchase tickets to ten films. Complaint,~ ~
17
108-109. These facts are sufficient to establish proximate causation. Kwikset Corp. v. Superior
18
Court, 51 _Cal.1th 3~0, 328-329, 246 P.3d 877,_889-890 (201 1); Mullins v. Premier !'luf:ition_ _
19
Corp., No. 13-CV-01271-RS, 2016 WL 1534784;at *20 (N.D. Cal. Apr. 15, 2016) (J. Seeborg);
20
Chacanaca v. Quaker Oats Co., 752 F. Supp. 2d 1111, 1125 (N.D. Cal. 2010) (J. Seeborg).
21
The Complaint also alleges during the period 2012 through the present, defendants' false
22
and mis leading film ratings caused 1.1 million children to becom e addicted to nicotine and will
23
result in the eventual premature death of 360,000 of such children from tobacco-re lated diseases
24 ·
including lung cancer, heart disease, stroke and emphysema. As a result , plaintiff's children have
25
been exposed to an increa sed risk of nicotine addiction , tobacco-related disease , and premature
26
death. Complaint
27
currently permit recovery for the increased risk of addiction , tobacco related diseases and
1~2-5 and 45-54.
Plaintiff acknowledges that California law does not
28
Motion to Strike
28
16-CV-00935-R
1
premature death. However, the Complaint states a claim for declaratory relief, injunctive relief,
2
the cost of the ticket purchases made by plaintiff and class members, restitution, punitive
3
damages, unjust enrichment or any other relief that the Court deems proper under California law.
4
5
6
7
Count VII properly states a claim for negligent misrepresentation .
C.
Plaintiff's negligence and voluntary undertaking claims
(Counts I and II) properly state claims
At the outset, a proper understanding of the Complaint's allegations will frame the
8
discussion of the sufficiency of its claims. Defendants inaccurately describe the Complaint ' s
9
allegations regarding the nature and scope of the duty defendants' voluntary assumed.
10
Defend.ants state: "Plaintiff's allegation that [defendants'] rule restricting youth under the age of
11
17 from seeing R-rated movies without a parent or guardian creates a duty to restrict
12
unaccompanied youth from seeing smoking imagery," and "the fact that [defendant] undertakes
13
to rate movies R when it believes that most American parents would not want their children to see
14
the movie unaccompanied does not obligate [defendants] to restrict youth from seeing tobacco
15
images on the grounds that it would be good public policy," and "The rule would require CARA
16
to give an R rating to movies that depict any conduct that advocacy groups think unhealthy" or .
17
"The law .... does not allow any advocacy group to define the contours of CARA's system
18
according to the group's particular social policy goals." -~TD at 16-17.
19
But that mis-states the Complaint. The Complaint describes the factual basis for the claim
20
that defendants volunt¥i ly undertook a duty of using reasonable care in rating films as suitable or
21
not for children under seventeen. Defendants designed their rating system so that films are either
22
certified as suitable for children under seventeen (and children under seventeen are allowed
23
unrestricted access) or, alternatively, defendants certify films as containing content that is not
24
suitable for children under seventeen (and for those R-rated films, defendants' rating system
25
prohibits children unaccompanied by a parent from admission to films). The Complaint asserts
26
that based upon how defendants designed and operate their rating system, defendants voluntarily
27
assumed the duty to exercise due care in certifying films as suitable, or not, for children under
28
Motion to Strike
29
16-CV-00935-R
,r,r.68, 72, and 73.
1
seventeen unaccompanied by a parent or guardian. Complaint
The Complaint
2
alleges that defendants are free to change their rating system, rules and procedures or to cease
3
operations entirely. Complaint
,r77.
4
The Complaint does not assert that defendants voluntarily assumed a duty to certif y films
5
with tobacco imagery as R-rated and restrict children's access to such films because it would be
6
"good public policy" or according to any particular advocacy "group's social policy goals," or
7
based upon "any conduct that advocacy groups think unhealthy. " MTD at 17. The Complain t
8
says nothing about "good public policy" or any "group's social policy goals," or "any conduct
9
that advocacy groups think unhealthy." The Complaint instead alleges that defendants breached
10
their duty to use reasonable care in assigning the PG-13 rating to films with tobacco imagery
11
because defendants know that exposure of children and adolescents to films with tobacco
12
imagery has been scientifically proven to cause nicotine addiction, tobacco-related diseases and
13
death-defendants
14
PG-13 rating, they will kill one million children.
know that at current rates, if defendants continue to rate such films with the
15
Defendants will have their chance to persuade the fact finder that they acted with due care
16
by treating the evidence from the United States Surgeon General, the Centers for Disease Control
17
and Prevention, the National Institute of Health, the American Medical Association, the
18
Am~rican Association for Pediatric s, and_the ~
19
as merely the unsupported, erroneous opinions of what some '·advocacy groups thinks is
20
unhealthy." However , defendants' assertion that the Complaint is based upon some vague public
21
policy opinions , or what some advocacy groups think may be unhealthy, seriously misapprehends
22
the claims asserted in the Complaint. It is based on traditional tort theories, as we now discuss.
23
Defendant s have a general duty to exercise due care in assigning ratings to films so as not
t?ri_can Public Health Associa!ion (among others)
24
to cause damage to plaintiff or, in the alternative, defendants voluntary assumed the duty to
25
exercise due care in connection with rating films for the benefit of parents and their children
26
under seventeen. Every person is under a duty to exercise reasonab le care not to injure another
27
person. Hensley-Macl ean v. Safeway , Inc., No. CV 11-01230 RS, 2014 WL 1364906, at *3
28
Plaintiffs Opposition to Defend ants' Special
Motion to Strike
30
16-CV-00935-R
1
(N.D. Cal. Apr. 7, 2014) (J. Seeborg); Rowlandv. Christian, 69 Cal. 2d 108,113, 443 P.2d 561,
2
564 (1968); and Jackson v. AEG Live, LLC, 233 Cal. App. 4th 1156, 1173, 183 Cal. Rptr. 3d 394,
3
408 (2015), review denied (May 13, 2015).
By their silence, defendants tacitly concede that defendants have a duty to exercise due
4
.
.
.
5
care in the rating of films under the standard tests for determining that there is a general duty to
6
exercise due care, or under the voluntary assumption of a duty line of authority. Rowland, at 113;
7
Melton v. Boustred, 183 Cal. App. 4th 521,530, 107 Cal. Rptr. 3d 481,489 (2010). See
8
Complaint
9
,r,r72-84. 23
Defendants make only two arguments that the negligence claims fail to state claims for
10
relief. Defendants assert that statements in defendants' internal written rules are legally binding
11
disclaimers of their legal duty to exercise due care. (MTD at 16-17.) In addition, defendants
12
assert, based upon statements in their internal written rules and a letter and press release written
13
in 2007, that defendants, as a factual matter, did not undertake the duty to exercise due care in the
14
rating of films, but rather voluntanly undertook a different, narrower duty in connection with
15
their certification trademarked ratings of film s. (MTD 17.)24
1.
16
Defendants did not disclaim their liability for negligence
There is no disclaimer of liability for negli gence on the certification trademarked rating
17
18
19
20
21
22
23
24
25
26
27
28
23
Once again, defendants mi scharacterize the claim s asserted in the Complaint. The duty alleged
for the neglig ence claim, and the voluntary-assumed duty of care _claim, is the duty to exercise
reasonable care in rating films . It is not a duty "to give mo vies with tob acco imagery anR
ratin g." MTD 15-16. The Complaint claims, based upon the scientific evidence and
recommendations from the leadin g experts in the medical and publi c health fields, that
defendants ' rating of films with tobacco ima gery as suitable for unacc ompanied children under
seventeen is negligent - that any reasonabl e person, exercising reasonable care, when informed of
the same scientific evidence and recomme ndations of the leading medical and public health
profes sional s as defendants have been, would not rate films with tobacco imagery with the PG-13
rating.
24
Defendants also rep eat their First Amendment arguments which for reasons explaine d above
are without merit. Defendants also assert that there is no logical stopping point if defendants are
liable for false and mi sleadin g ratings, that they could next be liable for not rating alcohol use,
gam bling, fatty foods or anything else. To plaintiff's knowledg e, however, there is no evidence
that exposure of children to film imag ery featurin g these other items actually causes addic tion,
disease and death , unlike with smoking where it has been established.
Plaintiff s Opposition to Defendants' Special
Motion to Strike
31
16-CV-00935-R
1
affixed to the films. There is no disclaimer in the 2007 press release, nor is there one in
2
defendants' internal written rules. There simply is no statement anywhere to the effect of:
3
"defendants hereby disclaim liability for negligence in the rating of :films." There is no statement
4
that says explicitly or even vaguely that: "Defendants are not liable for negligent or intentional
5
inaccuracies in the ratings assigned to any film" or "Defendants are not responsible for the
6
accuracy of the ratings and parents should not rely upon the rating of any film as a basis to
7
conclude that the content of any film is actually appropriate for children under seventeen
g
unaccompanied by a parent of legal guardian."
In Young v. Facebook, Inc., No. 5:10-CV-03579-JF/PVT, 2010 WL 4269304, (N.D. Cal.
9
10
Oct. 25, 2010), the case relied upon by defendants, there was a clear, explicit disclaimer of
11
liability. Moreover, in Young, the plaintiff had signed the written terms of service agreement that
12
included the explicit disclaimer. Here, plaintiff and other parents signed no service agreement,
13
there is no disclaimer of liability for negligence in the 2007 letter and press release, in
14
defendants' internal, written rules, nor anywhere else. 25
2.
15
Defendants' argument that they voluntarily assumed
a narrower duty than the duty alleged in the Complaint
16
17
Defendants also claim that the duty of due care that they voluntarily assumed is different
18
than the duty described in the Complaint. The Complaint alleges defendant s voluntarily assumed
19
the duty to use due care in assigning ratings to films and to give parents advance cautionary
20
warning that a ~Im contains content that is, or is not, suitable for unaccompanied children _under
21
seventeen. The Complaint states that defendants certify certain films as either (i) suitable for
22
unrestricted viewing by children under seventeen (G, PG, or PG-13) or (ii) they prohibit children
23
under seventeen from viewing films that defendants certify as containin g conten t that is not
24
suitable for unaccompanied children under seventeen. Compl.
111,55, 56,67, 68, 72, 73 and 84.
25
26
27
28
25
Defendants are among the largest, most sophisticated corporations in the United States.
Defendants clearly know how to write an explicit disclaimer ofliability. There are no disclaimers
for the movie ratings because the entire point of the certification trademark ratings is to solicit,
encourage and obtain parents ' relian ce on the ratings.
Plaintifrs Opposition to Defendants' Special
Motion to Strike
32
l 6-CV -00935-R
Defendants assert, however, that the only duty they voluntarily assumed was "merely" the
1
2
duty to use reasonable care to assign a rating to each film that a majority of American parents
3
would assign to that film. MTD at 16-17. There are three things wrong with defendants'
4
argument regarding the voluntarily assumed duty claim.
5
First, defendants claim that their internal written rules actually describe a different and
6
narrower duty that defendants voluntarily assumed than the nature and scope of the voluntarily
7
assumed duty that is alleged in the Complaint. Defendants claim that the internal written rules
8
limit the duties defendants voluntarily assumed to a duty "merely" to accurately assign ratings to
9
films that a majority of American parents would assign and rely again upon Young. MTD at
10
pages 15-17. As stated above, there is no evidence that plaintiff or any parent was aware of
11
defendants' internal written rules, and any attempt to limit, qualify, or narrow the scope of the
12
duties defendants voluntarily assumed by statements in defendants' internal written rules is not
13
binding upon plaintiff or other parents because, in contrast to Young, plaintiff and other parents
14
did not sign a user agreement or anything by which they agreed to be bound by the terms of
15
defendants' internal written rules.
26
Defendants also rely on a 2007 letter and press release to claim that they disclaimed the
16
17
duties described in the Complaint. Complaint, Exhibit 5. However, a comparison of the internal,
18
written rules with the press release highlights the discrepancy between defendants' internal,
19
written rules and defendants' public statements describing the nature and purpose of the rating
20
system, and encouraging and soliciting parents' trust and reliance upon the rating system. There
21
is no statement whatsoever in the press release that the ratings are merely supposed to be an
22
assessment, or opinion, of how the average parent would rate the content of a film.
The 2007 press release states the nature and purpose of the rating system is "an educational
23
24
tool for parents to assist them in making decisions about what movies are appropriate for their
25
children." Complaint, Ex. 5. In addition, in another press release, from 2015, the Chairperson of
26
CARA publicly described the nature and purpose of the rating system, and the scope of the duties
27
26
28
In addition, the internal, written rules are themselves inconsistent in describing the nature or
purpose, or undertaking, of the rating system.
Motion to Strike
33
16-CV-00935-R
1
voluntarily assumed, as follows: "It is a responsibility we take very seriously, asking ourselves
2
before every screening: 'What would I want to know before letting my child watch this film?"'
3
Ex. 5.
4
Defendants' argument that the duty they voluntarily assumed was merely to issue opinions
5
regarding how the average parent would rate fil:r;ncontent is also inconsistent with the MP AA's
6
Chief Executive Officer's letter to the state attorneys' general in which Mr. Glickman states that
7
defendants were soliciting expert medical and public health advice for the purpose of properly
8
rating films with tobacco imagery (which advise defendants subsequently ignored). Complaint
9
Par. 62, 63 and 96; Complaint , Exhibit 2. 27
10
11
Defendants' arguments that the nature and scope of the duties they voluntari ly assumed are
11
exclusively, or even partially, correctly described in those rules, or that the internal rules are
12
binding upon consumers, are without merit.
13
Second, defendants' arguments create, at most , disputed factual issues regarding the nature
14
and scope of the duty defendants' voluntarily assumed. Defendants attempt in the Motion to
15
dispute the accuracy of the facts regarding the nature and scope of the dutie s defendants
16
voluntarily assumed as alleged in the Complaint is not a basis to dismiss the claim under Rule
17
12(b)(6) . Jackson v. AEG Live, LLC, 233 Cal. App. 4th 1156, 183 Cal. Rptr. 3d 394 (2015),
18
review denied (May 13, 2015),the case relied upon by defendant s for this point, was decided on a
19
full factual record on a motion for summary judgment.
Third, even assuming the only duty of care defendants voluntaril y undertook was the duty
20
21
to assign a rating to each film that a majority of Ameri can parents would assign, defendants
22
simply ignore the fact that the Complaint alleges defendants breached this duty as well. The
23
Complaint states that all reasonable parents (that is, 100%), or at the very least, a majorit y of
24
American parents, if provided the same scientific evidence and recommendations provided to and
25
26
27
28
27
Until plaintiff obtains discovery of how the ratings are actually assigned, no one will know how
defendants' rating system actually works; nor will anyone know to what extent the actual process
is accurately described in the internal , written rules or in defendants' public statements describing
the ratings system. As described in note 7, above, the entire process is conducted in secret.
Plaintiff's Oppo sition to Defendants' Special
Motion to Strike
34
16-CV -00935-R
I
known to defendants, would never assign a "PG-13" rating to films featuring tobacco imagery.
2
Complaint ,r88. Thus, even under defendants' theory of a narrower definition of the duty they
3
voluntarily assumed, the voluntary undertaking claim nonetheless states a valid claim.
D.
4
5
6
Plaintiff's fraudulent misrepresentation Claim (Count IV)
properly states a claim.
Defendants assert that the fraudulent misrepresentation claim fails for the same reasons as
7
the negligent misrepresentation claim supposedly fails (MTD at 20) and for the further reason
8
that plaintiff supposedly cannot allege scienter. For the reasons stated in Section IV.B above,
9
defendants' arguments against the negligent misrepresentation claim fail. They are incorporated
10
11
herein.
Defendants assert that plaintiff "cannot plead scienter." (MTD at 20.) Defendants say this
12
is so because the Complaint supposedly alleges that CARA has known "of the correlation
13
between tobacco imagery in youth-rated movies and adolescent nicotine addiction." MTD at 20-
14
21; emphasis added. But the Complaint alleges something very different - that science has now
15
established that smoking imagery causes addiction, diseases and premature deaths, and that
16
defendants have known about this throughout the period they have continued to assign PG-13
17
2-5, 45-54, and 92-96.
ratings to such films . Complaint ,r,r
18
The Complaint alleges, and the evidence will establish, exposure to tobacco imagery
19
causes nicotine addiction, tobacco -related diseases and death. Defendants cannot argue with that
20
allegation on a 12(b)( 6) motion and then argue that scienter has not be shown. Indeed, implicit in
21
defendants ' attempted restatement of plaintiffs actual allegation is the admission that anyone
22
who gave PG-13 rating to films knowing what all leading health authorities had said necessarily
23
acted culpably. Defendants falsely certified that films with tobacco imagery were suitable for
24
children under seventeen with full knowledge of the scientific fact that exposure to films with
25
tobacco imagery causes children and adolescents to become addicted, develop tobacco-related
26
diseases and die. The complaint alleges that, at current rates, defendants' PG-13 rating would
27
cause 3.2 million children to become smokers and would kill one million children. Complaint ,r,r
28
Motion to Strike
35
l 6-CV-009 35-R
1
2-5, 45-54 and 92-96. The leading scientists in the United States, including the senior scientific
2
editor of three of the Surgeon General's reports on tobacco, major professional medical
3
association and public health association in America, and the chief law enforcement officers of
4
thirty-one states, reco_mmended to defendants that they stop assigning the PG-13 rating to films
5
with tobacco imagery. Complaint
6
defendants knew that tobacco imagery in films was not suitable for children under seventeen,
7
because they separately adopted corporate policies to discourage tobacco imag ery in youth-rated
8
films. Complaint
9
PG-13 because they make significantly more money from selling tickets to the larger under-
10
,r,r94-95.
,r,r2-5, 45-54,
and 96. Each of the Hollyw~od Studio
Defendants continue to falsely rate films with tobacco imag ery as
seventeen market than they do from adult R-rated films . Complaint
11
,r,r102-104.
Defendants' claims regarding scienter are, at a minimum , without merit.
E.
12
Plaintifrs breach of fiduciary duty Claim (Count III) properly states a claim
Defendants knowingly solicited and obtained the trust of the film-going public and, in
13
14
particular , parents of children under seventeen, to rely upon defen dants' film rating serv ice.
15
Defendants have knowingly accepted parent s' trust and ·reliance upon their film rating system as
16
the source of critical information regarding the content of films, the health and safety of their
17
children, and what films they will allow their children to see. Complaint , Par. 134, 56, 67, 68, 72
18
and 84.28
19
Most signifi cantl y for purpo ses of the fiduciar y duty claim , defendants ' rating system was
20
created and is operated by both the Holl ywood Studio Defendants and NATO to demonstrate to
21
parents that defendants give priority to parents' interests in the health and welfare of their
22
childr en over defendants ' financial interests, because defendants voluntaril y adopted a system of
23
self-regulation or self-cen sorship. Defendant s chose to design and operate a system that does not
24
merely advise parents and children regarding film cont ent that is not appropria t e for children
25
under seventeen. Defendant s prohibit children under seventeen from admissio n to theatres if
26
27
28
28
See Section B.2, above de scribing defendant s' knowledge that par ents rely upon defendants '
certifi ed trademarked ratin gs .
Plaintif f's Oppo sitio n to Defendants' Special
Motion to Str ike
36
16-CV-0093 5-R
I
defendants determine the film content is not appropriate for them. Defendants' system, by design
2
and in operation, tells parents and children that we (the film studios and theatre owners) are
3
putting your interests ahead of our own financial interests by voluntarily refusing to sell our
4
product to unaccompanied children under seventeen if we determine it is not appropriate for
5
them. Complaint ,r,r1, 55, 68, 72, 73, and 134.
6
The existence of a confidential relationship arises where confidence and trust is reposed
7
by one party in the integrity of another and where the person solicits and or accepts the
8
confidence and trust. A fiduciary duty arises where a party voluntarily undertakes to act on
9
behalf of another - to give priority to the bests interests of the other person. Comm. On
IO
Children's Television, Inc. v. Gen. Foods Corp., 35 Cal. 3d 197, 221-222, 673 P.2d 660 (1983)
11
("Children's Television"); Herbert v. Lankershim, 9 Cal. 2d 409,483, 71 P.2d 220,257 (1937;
12
Persson v. Smart Inventions, Inc., 125 Cal. App. 4th 1141, 1161, 23 Cal. Rptr. 3d 335,351
13
(2005). In addition, the existence of a confidential relationship and whether defendants accepted
14
the relationship are questions of fact that should not be decided on a 12(b)(6) motion. Persson, at
15
1161, 350.
16
Defendants argue that in a typical conunercial relationship between buyers and sellers
17
there is no fiduciary relationship because "sellers routinely make representations concerning their
18
product, often on the basis of a claimed expert knowledge about its utility and value." Children's
19
Television, at 221-222. Defendants claim, using the language from Children's Television, that
20
they have not voluntarily undertaken to "act on behalf of parents and give priority to their best
21
interests." MTD at 21-22.
22
However, that is precisely what defendants have done with their rating system and what is
23
alleged in the Complaint. Defendants purport to have undertaken to act on behalf of parents and
24
children, to give priority to their interests above their own conunercial interests. Defendants
25
assure parents they can and should rely upon the rating system because defendants voluntarily
26
refuse to sell their products to children under seventeen if they determine the product is not
27
appropriate for them. Defendants have benefited enormously by soliciting and obtaining parents'
28
Motion to Strike
37
l 6-CV-00935-R
1
trust in the belief that the rating system was operated to put parents' interest s above defendants'
2
commercial interests.
3
Defendants' rating system is unlike other commercial relationship s between buyer s and
4
sellers. Defendants refuse to sell their products to children if defendan~ determine that the
5
product is not suitable for them -- for the purpose, and wit h the effect, of obtainin g par ent s'
6
confidence and trust. Defendants should not be permitted to claim that they are giving priority to
7
parents' interests above their own financial interests , and now claim that they should only be held
8
to the standards or mores of the marketplace. Children's Television, at 222.
The fiduciary duty claim properly states a claim. 29
9
F.
10
Plaintiff's nuisance Claim (Count VIII) properly states a claim
11
The Complaint clearly alleges that defendants' imp roper ratin gs assi sted in creating the
12
nuisanc e. Complaint, Par, 162-164. Defendant s are also wrong in claiming that the nuisan ce
13
claim should be dismis sed at the pleading stage becaus e the evidence ma y show that it is pure ly
14
duplicative of the negli genc e claim. While in some situa tion s a general neg ligence and nuisance
15
claim may be identical , the re lief available may vary, and the liability of the various defendant s
16
may differ under a negligenc e or nuisan ce claim and, t herefore, at the ple ading stage, it canno t be
17
sai d that they are identicaJ. Team Enterprises, LLC v. W Inv. Real Estate Trust, 647 F.3d 901,
18
911-912 (9th Cir. 2011 ). The Complaintproperly pleadsa claimfor nuisance.
19
G.
20
Defe ndant s rely solely upon their prior erroneou s argum ents regarding First Amendment
21
protec tion s, non-act ion abl e opinion s, false representations and reasonable r eliance as reasons to
22
dismiss the false adverti sing claim und er Section 17500. Plaintiff has responded to each of those
23
argumen ts previously and incorporates his prior arguments.
Plaintiff's false advertising Claim (Count VI) properl y states a claim
24
25
26
27
28
29
Defe ndan ts mi sstate the damage caused by defendants ' breach of fiduc iary duty as plaintiff's
children's alleged injuries . MTD at 22. The Comp laint alleges the damag es to be the amo unt
plainti ff paid for tickets to the films and for the unjust enric hment to defendants resulting from
their breach of fiduciary duty, and punitive damages. Comp laint ff 108-110 .
Plaint iff's Oppo sition to Defendant s' Spec ial
Motion to Strike
38
16-CV-00935 -R
1
H.
2
Except for the two additional arguments discussed below, defendants rely upon their prior
Plaintiff's unfair competition law Claim (Count V) properly states a claim
3
erroneous arguments regarding First Amendment protections and F AL deficiencies as reasons to
4
dismiss the UCL claim. (MTD at 24.) Plaintiff has previously responded to those arguments.
5
Defendants assert that plaintiffs claim under the "unlawful" prong of the UCL relies on
6
inapplicable predicate violations. (Id.) But the violation of the FAL and of the nuisance law,
7
discussed above, plainly satisfies the "unlawful" prong of the UCL.
8
Defendants also assert that the Complaint fails to state a claim under the "unfairness"
9
prong of the UCL because the unfairness prong is limited to showing that the ratings threaten an
10
incipient violation of the anti-trust laws. Cel-Tech Commc'ns, Inc. v. Los Angeles Cellular Tel.
11
Ca., 20 Cal. 4th 163, 180, 973 P.2d 527 (1999). But that is not the law. In consumer cases the
12
courts apply the following test for the "unfairness" prong of the UCL: (1) the injury must be
13
substantial; (2) the injury must not be outweighed by any countervailing benefits to consumers or
14
competition; and (3) the injury must be one that the consumer could not reasonably have avoided.
15
Hensley-Maclean v. Safeway, Inc., No. CV 11-01230 RS, 2014 WL 1364906, at *8 (N.D. Cal.
16
Apr. 7, 2014) (J. Seeborg); Lyons v. Bank of Am., NA, No. 11-01232 CW, 2011 WL 3607608, at
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*10 (N.D. Cal. Aug. 15, 2011). Defendants have not attempted to show, and could not show, that
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as a matter of law their conduct passes this test. And it doesn't. .
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Defendants make no attempt to argue that the fraudulent portion of the UCL claim fails to
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state a claim other than the arguments made with respect to the FAL claim. Defendants'
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arguments with regard to the FAL claim are without merit for the reasons stated above.
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The Complaint properly states claims under all three prongs of the UCL.
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I.
Defendants' Motion to dismiss under Rule 12(b)(6) should be denied
For all the reasons stated above, none of the claims should be dismissed under Rule 12(b)(6).
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Motion to Strike
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16-CV-00935-R
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V.
CONCLUSION
For the foregoing reasons , Defendants' Special Motion To Strike Pursuant To California
Anti-SLAPP Statute and Motion To Dismiss Pursuant To Fed. Civ. P. 12(b)(6) should be denied.
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Dated: July 15, 2016
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Respectfully submitted,
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By:
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Isl David Schachman
David Schachman
John G. Jacobs
Bryan G. Kolton
Jeffrey F. Keller
Carey G. Been
Sarah R. Holloway
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Attorneys For Plaintiff Timothy Forsyth
And the Putative Class
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Plainti ff's Opposition to Defendants ' Special
Motion to Strike
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16-CV -00935-R
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CERTIFICATE OF SERVICE
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I, David Schachman, an attorney in this matter, certify that on July 15, 2016, I served the
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foregoing Plaintiff's Opposition To Defendants' Special Motion To Strike by causing true and
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accurate copies of such paper to be filed and transmitted to the persons registered to receive such
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notice via the Court's CM/ECF electronic filing system .
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/s/ David Schachman
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Plainti ffs Opposition to Defendants' Special
Motion to Strike
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16-CV-00935 -R

Case 3:16-cv-00935-RS Document 44 Filed 07/15/16 Page 1 of 48

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