Gurminder Singh v. Google LLC

NOT FOR PUBLICATION FILED

UNITED STATES COURT OF APPEALS SEP 1 2020

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

GURMINDER SINGH, individually and on No. 18-17035

behalf of others similarly situated,

D.C. No.

Plaintiff-Appellant, 5:16-cv-03734-BLF

v.

MEMORANDUM*

GOOGLE LLC,

Defendant-Appellee.

Appeal from the United States District Court

for the Northern District of California

Beth Labson Freeman, District Judge, Presiding

Argued and Submitted May 14, 2020

San Francisco, California

Before: FRIEDLAND and BENNETT, Circuit Judges, and RAKOFF,** District

Judge.

Plaintiff-Appellant Gurminder Singh appeals the district court’s order

granting Defendant-Appellee Google LLC’s (“Google”) motion to dismiss based

on lack of statutory standing under California law. We have jurisdiction under 28

*

This disposition is not appropriate for publication and is not precedent

except as provided by Ninth Circuit Rule 36-3.

**

The Honorable Jed S. Rakoff, United States District Judge for the

Southern District of New York, sitting by designation.

U.S.C. § 1291, and “review de novo the district court’s dismissal of [Singh]’s

claims.” Hinojos v. Kohl’s Corp., 718 F.3d 1098, 1103 (9th Cir. 2013). We reverse

and remand.

Singh has adequately pled statutory standing under California’s False

Advertising Law (FAL) and Unfair Competition Law (UCL). This economic injury

in fact requirement “demands no more than the corresponding requirement under

Article III of the U.S. Constitution.” Reid v. Johnson & Johnson, 780 F.3d 952,

958 (9th Cir. 2015). Singh alleged sufficient economic injury and causation. Singh

alleges that he purchased some number of clicks from Google via its AdWords

program, Google misrepresented the general efficacy of its fraudulent click filters,

and he would not have purchased clicks but for his reliance on the allegedly

erroneous fraud filter rate. Id. (“In a false advertising case, plaintiffs meet this

[standing] requirement if they show that, by relying on a misrepresentation on a

product label, they ‘paid more for a product than they otherwise would have paid,

or bought it when they otherwise would not have done so.’” (citation omitted)); see

also Hawkins v. Kroger Co., 906 F.3d 763, 768 (9th Cir. 2018).

The district court applied too stringent of a pleading stage standard when it

concluded that Singh had not sufficiently alleged that he suffered the requisite

economic injury. Singh alleged that he has used the AdWords service to run his ad

campaigns since 2008 and that he became suspicious of the efficacy of Google’s

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filters in catching fraudulent clicks in 2016. Singh further alleged that he hired

Oxford BioChronometrics in 2018 to conduct an analysis of some of his ad

campaigns, which showed that Google’s filters caught fewer fraudulent clicks than

advertised, and that numerous studies prior to 2016 on third-party ad campaigns

found that Google’s filters did not catch as many fraudulent clicks as Google

advertised. At the pleading stage these allegations together are sufficient to draw

the reasonable inference that Singh’s ad campaigns prior to 2016 similarly suffered

higher-than-advertised rates of fraudulent clicks not caught by Google’s filters, and

that he accordingly paid for more fraudulent clicks than Google advertised he

would.1 See Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031

(9th Cir. 2008) (“We accept factual allegations in the complaint as true and

construe the pleadings in the light most favorable to the nonmoving party.”). Thus,

Singh’s allegations are sufficient, at the pleading stage, to plausibly allege

economic injury and causation, and the district court erred in concluding

otherwise.2

Google contends that the district court’s judgment may be upheld on

1

We thus need not decide whether a consumer must allege (or prove) that

Google’s filters were ineffective as to his ad campaigns to establish standing under

the UCL or FAL.

2

We need not reach Singh’s argument that the district court erred in finding that he

paid for clicks and not the AdWords service. Whether he suffered the requisite

economic injury does not depend on whether the money he paid Google is

characterized as paying for clicks or a service.

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alternate grounds. See Canyon Cty. v. Syngenta Seeds, Inc., 519 F.3d 969, 975 (9th

Cir. 2008) (noting that we may “affirm the dismissal on any ground supported by

the record”). We disagree.

Google first argues that Section 8 of the AdWords Agreement expressly

precludes Singh’s claims and the dismissal can be affirmed on this ground alone.

The district court concluded that “that under the circumstances in this case, a

reasonable jury could find that Singh was reasonable in relying on Google’s

statements notwithstanding the ‘no guarantee’ provision . . . in the AdWords

Agreement.” The district court then explained “that a reasonable consumer could

not view Google’s extra-contractual representations as any sort of ‘guarantee’ of a

specific invalid clicks rate, which would be precluded by the express language of

Section 8 of the Agreement.” We agree with the district court’s initial statement: a

reasonable jury could find that a consumer may still reasonably view these extra-

contractual statements as a description about the general effectiveness of Google’s

click filter system, irrespective of any specific guarantee. Cf. Rubio v. Capital One

Bank, 613 F.3d 1195, 1204 (9th Cir. 2010). Thus, Section 8 of the agreement does

not mandate affirming the dismissal of the complaint.

Google also posits that a 2007 blog post precludes any deception of a

reasonable consumer (as to the 10% figure) as a matter of law. See In re Tobacco II

Cases, 207 P.3d 20, 29 (Cal. 2009) (noting that to state a FAL or UCL fraud claim,

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plaintiff must allege that “members of the public are likely to be deceived” by

defendant’s misrepresentations); Davis v. HSBC Bank Nevada, N.A., 691 F.3d

1152, 1152, 1169 (9th Cir. 2012) (whether the public is likely to be deceived is

viewed through the lens of a “reasonable consumer”). The district court addressed

this point in the context of reasonable reliance, finding that a reasonable consumer

could still “expect his or her invalid clicks report to show an invalid clicks rate that

is consistent with Google’s representations, even if not the exact average.”

Moreover, Google has not shown that a reasonable consumer would be aware of

the relevant content in Google’s blog post when seeing the 10% figure statement or

signing up for AdWords. Cf. Freeman v. Time, Inc., 68 F.3d 285, 289 (9th Cir.

1995) (finding no misrepresentation in part because “[t]he qualifying language

appears immediately next to the representations it qualifies and no reasonable

reader could ignore it”). Accordingly, the blog post does not support affirming the

dismissal of the complaint on the basis that Singh has not adequately pled that

consumers are likely to be deceived.

Google’s other arguments for why a reasonable consumer would not be

deceived by the 10% figure and “vast majority” statement similarly do not warrant

affirmance. See Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008)

(“[W]hether a business practice is deceptive [is] usually . . . a question of fact not

appropriate for decision on [a motion to dismiss].”). We leave to the district court

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to consider in the first instance whether Singh has adequately alleged with

sufficient particularity that Google’s other statements were false or deceptive. See

Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009).3

REVERSED and REMANDED.

3

As noted above, Singh has sufficiently alleged standing as to his FAL and UCL

claims. Though we have rejected Google’s arguments about the pleading

sufficiency under the fraud prong of the UCL, the district court never reached the

viability of Singh’s claim under the UCL’s unfair prong in his operative complaint.

We express no opinion on this issue.

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