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Theresa J. Henson Kaymak On Behalf of v. Aaa Mid-Atlantic

September 7, 2012

THERESA J. HENSON KAYMAK ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED
v.
AAA MID-ATLANTIC, INC.



The opinion of the court was delivered by: Juan R. Sanchez, J.

MEMORANDUM

In this putative class action, Plaintiff Theresa J. Henson Kaymak alleges Defendant AAA Mid-Atlantic, Inc. (AAA) overcharged her for her 2008-2009 AAA membership when she renewed her membership after it had expired. Kaymak brings claims for breach of contract and unjust enrichment. AAA asks this Court to dismiss Kaymak's Class Action Amended Complaint in its entirety for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1), alleging Kaymak lacks constitutional standing to assert her claims. For the following reasons, AAA's motion will be granted.

FACTS

AAA is a non-profit automobile club that provides services and benefits to its members, including roadside assistance services and discounts from various third-party vendors, such as hotel chains, railroads, and car rental agencies. To maintain a membership in good standing, members are obligated to pay their membership dues annually for a twelve-month membership. AAA offers three levels of membership, the least expensive of which is the "basic" level. For this level of membership, the annual dues at all times material hereto were $61.25.

Kaymak initiated her membership with AAA in 1997, and had a basic membership throughout her tenure as a AAA member. In November 2007, Kaymak again purchased the basic level of membership, and AAA issued her a three-year membership card. The face of her membership card noted it was "valid thru" November 15, 2010 (three years from the date of renewal), with "dues billed annually." Def.'s Proposed Findings of Fact & Conclusions of Law, AAA Ex. 5. Thus, Kaymak's 2007-2008 membership expired for dues purposes on November 15, 2008. Sixteen days later, on December 1, 2008, Kaymak's car became disabled with a flat tire. That same day, knowing her membership had expired and believing she had lost all of her member benefits, Kaymak accessed AAA's website to renew her membership, and paid her dues for another year of membership.*fn1 Instead of expiring on December 1, 2009, twelve months from the date she paid her dues, Kaymak's renewal membership expired on November 15, 2009, twelve months from the date her previous membership expired.

Kaymak alleges AAA "backdates" the start date of renewal memberships to the prior year's expiration date, causing "AAA members [to] receive less than the full 12 months of membership for which they bargained." Am. Compl. ¶ 2. Kaymak contends she has suffered an injury in fact as a result of this practice, namely, "the dollar loss for the [16-day] period of her membership for which she paid but did not receive due to AAA's unlawful policy to backdate the length of her membership to less than 12 months." Pl.'s Proposed Findings of Fact and Conclusions of Law 2. Accordingly, Kaymak filed this class action lawsuit on behalf of herself and other similarly situated consumers who allowed their memberships to expire, and who allegedly were overcharged by AAA when they subsequently renewed their annual memberships.

DISCUSSION

A motion to dismiss for lack of standing is properly brought pursuant to Federal Rule of Civil Procedure 12(b)(1) governing motions to dismiss for lack of subject matter jurisdiction because standing is a jurisdictional matter. Fed. R. Civ. P. 12(b)(1); Knauss v. U.S. Dep't of Justice, No. 10-2636, 2012 WL176685, at *1 (E.D. Pa. Jan. 20, 2012). Jurisdiction must be established as a threshold matter. Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94 (1998). A motion to dismiss pursuant to Rule 12(b)(1) may be brought as a facial or factual challenge. See Church of the Universal Bhd. v. Farmington Twp. Supervisors, 296 F. App'x 285, 288 (3d Cir. 2008). Where the motion challenges jurisdiction on the face of the complaint, the court must only consider the allegations of the complaint and documents referenced therein in the light most favorable to the plaintiff. Gould Elecs., Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000) (citing Mortenson v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977)). By contrast, where, as here, the existence of subject matter jurisdiction is challenged in fact, "no presumptive truthfulness attaches to the plaintiff's allegations," and the court may consider evidence outside the pleadings to satisfy itself of its power to hear the case.*fn2 Id. As the party invoking federal jurisdiction, the plaintiff bears the burden of establishing elements of standing. Symczyk v. Genesis Healthcare Corp., 656 F.3d 189, 191 n.4 (3d Cir. 2011). "Absent Article III standing, a federal court does not have subject matter jurisdiction to address a plaintiff's claims, and they must be dismissed." Common Cause of Pa v. Pennsylvania, 558 F.3d 249, 257 (3d Cir. 2009) (quoting Taliaferro v. Darby Twp. Zoning Bd., 458 F.3d 181, 188 (3d Cir. 2006)).

A plaintiff has constitutional standing to bring a claim in federal court if the plaintiff demonstrates (1) she has suffered an "injury in fact" that is (a) concrete and particularized, and (b) actual or imminent; (2) the injury is fairly traceable to the defendant's challenged action; and (3) it is likely, as opposed to merely speculative, that the injury will be prevented or redressed by a favorable decision of the court. See Summers v. Earth Island Inst., 555 U.S. 488, 493 (2009) (citing Friends of Earth, Inc. v. Laidlaw Envt'l Servs. (TOC), Inc., 528 U.S. 167, 180-81 (2000)); see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).

In its motion, AAA focuses on the first requirement, "injury in fact." This requirement ensures the plaintiff has a "personal stake" in the litigation. See The Pitt News v. Fisher, 215 F.3d 354, 360 (3d Cir. 2000). An injury is "concrete" if it is "distinct and palpable, as opposed to merely abstract," N.J. Physicians, Inc. v. President of U.S., 653 F.3d 234, 238 (3d Cir. 2011) (quoting Whitmore v. Arkansas, 495 U.S. 149, 155 (1990)), and it is "particularized" if it "affect[s] the plaintiff in a personal and individual way," Lujan, 504 U.S. at 560 n.1. In addition, an injury is "actual or imminent" if it is "actually occurring" or there is a "realistic danger of sustaining a direct injury." N.J. Physicians, 653 F.3d at 238 (quoting Babbitt v. United Farm Workers Nat'l Union, 442 U.S. 289, 298 (1979)) (explaining "there must be a 'genuine probability' that a future injury will occur in order for that injury to be sufficiently imminent").

AAA alleges Kaymak cannot demonstrate she suffered any injury as a result of AAA's "backdating" of her membership because Kaymak was not without any of her member benefits during the 16-day period at issue. On October 27, 2009, AAA implemented a grace period policy which extends all member benefits for the first 30 days after a membership has lapsed. Thus, during the initial 30-day period from November 15, 2009, when Kaymak's membership expired, through December 15, 2009, Kaymak remained a member in good standing and was eligible for all of the AAA services to which she was contractually entitled under her basic level of membership.*fn3

Accordingly, AAA argues Kaymak actually received more than the 12 months of membership for which she bargained, as she in fact received over 13 months of membership, and not 111/2 months as she contends.

For her part, Kaymak argues she was not aware of AAA's grace period policy and had never been notified of such a policy. As a result, Kaymak argues the grace period policy was not part of her contract because it was not disclosed to her, and thus, does not apply to her.

AAA initiated its grace period policy in late 2009. As of October 27, 2009, the policy was published in AAA's Member Benefits Guide, which is available to all members on the AAA website. Hr'g Tr. 64:3-15, Sept. 8, 2011. The policy, ...


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