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Luca v. Wyndham Worldwide Corp.

United States District Court, W.D. Pennsylvania

February 15, 2017

THOMAS LUCA, JR., Plaintiff,
v.
WYNDHAM WORLDWIDE CORP., WYNDHAM HOTEL GROUP, LLC, WYNDHAM HOTELS AND RESORTS, LLC, and WYNDHAM HOTEL MANAGEMENT, INC., Defendants.

          OPINION

          MARK R. HORNAK, UNITED STATES DISTRICT JUDGE,

         In this civil action, Plaintiff, on behalf of himself and a purported class, avers that a hotel reservation website for which Defendants are responsible violated the New Jersey Consumer Fraud Act ("CFA"), N.J.S.A. § 56:8-1, et seq., and the New Jersey Truth-in-Consumer Contract, Warranty and Notice Act ("TCCWNA"), N.J.S.A. § 56:12-14, et seq. In sum, Plaintiffs Class Action Complaint ("Complaint") avers that he reserved a hotel room through the website, which did not adequately disclose the total costs associated with the room. Before the Court are two Motions to Dismiss Plaintiffs Complaint, one filed by Defendants Wyndham Hotel Group, LLC ("WHG") and Wyndham Hotels and Resorts ("WHR"), and the other filed by Defendants Wyndham Hotel Management ("WHM") and Wyndham Worldwide Corporation ("WWC"). The Court held oral argument on the Motions, and the parties then filed supplemental briefs. The Motions are now ripe for review. For the following reasons, the Motion filed by WHG and WHR will be denied without prejudice to Defendants to reassert their arguments at a later stage in this litigation, and the Motion filed by WHM and WWC will be granted without prejudice to Plaintiff, and with leave to amend.

         I. LEGAL STANDARD

         Under the familiar plausibility standard governing motions to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), courts must "accept all factual allegations [in the complaint] as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief." Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009). Although Federal Rule of Civil Procedure 8(a)(2) requires only "a short and plain statement of the claim, " and although a plaintiff is not required to make detailed factual allegations, a complaint must nevertheless plead "enough facts to state a claim to relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). While "[t]he plausibility standard is not akin to a probability requirement, " it nevertheless "asks for more than a sheer possibility that a defendant has acted unlawfully." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "[L]abels and conclusions, " therefore, are not enough to survive a motion to dismiss, nor are courts "bound to accept as true a legal conclusion couched as a factual allegation." Twombly, 550 U.S. at 555.

         '"A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'" Sheridan v. NGK Metals Corp., 609 F.3d 239, 262 n.27 (3d Cir. 2010) (quoting Iqbal, 129 S.Ct. at 1949). Further, a complaint must give a defendant "fair notice of what the ... claim is and the grounds upon which it rests." Dillard v. Talamantes, No. 15-974, 2016 U.S. Dist. LEXIS 179627, at *2 (M.D. Pa. Dec. 29, 2016).[1]

         II. DISCUSSION

         A. Motion to Dismiss - WHM and WWC

         Defendants WHM and WWC argue that Plaintiff has not sufficiently pled facts that would support direct liability against them, and that derivative liability principles do not apply here.[2] In particular, they point to the fact that the Complaint does not allege that WHM or WWC operate the website that Plaintiff used. Plaintiff responds that his allegations regarding the interrelationships between the Defendants and the subject websites, as well as his averments against "Defendants" collectively, suffice. Under the circumstances, however, Plaintiffs Complaint fails to provide WHM and WHC with sufficient factual content to provide the "fair notice" required by applicable pleading standards. The Complaint's generic, collective factual allegations, along with its conclusory statements of fact and law pertinent to common control, do not allow the reasonable inference that WHM and WWC are liable for the alleged conduct. Defendants' Motion will be granted to that extent, without prejudice to Plaintiff to amend his Complaint in an attempt to cure the deficiency.

         B. Motion to Dismiss - WHG and WHR

         Defendants WHG and WHR move to dismiss Plaintiffs Complaint on several grounds. These Defendants argue that Plaintiffs CFA claim fails because the website's disclosures were adequate, because Plaintiff has not pleaded ascertainable loss, and because Plaintiff cannot sue under New Jersey law. They also argue that his TCCWNA claim, which is based on the website Terms of Use, fails because Plaintiff suffered no injury from the Terms of Use and thus lacks Constitutional and statutory standing to sue. In brief, Plaintiff responds that the actual final total charges for the hotel room were not disclosed during the online booking process, that the Terms of Use enable his New Jersey statutory claims, and that he has alleged adequate injury to confer standing.

         1. Plaintiffs CFA Claim

         First, Defendants contend that the website's repeated disclosures of costs and fees were sufficient, and preclude Plaintiffs CFA claim. At this juncture, Plaintiffs Complaint is adequate. For example, at oral argument, Plaintiff argued that the website did not at any point disclose the tax levied on the resort fee. That tax, he argued, was not disclosed until the final invoice issued after his hotel stay. Defendants raise no substantive challenge to this argument; instead they object that this allegation is "new" and should be disregarded. The Complaint does, however, refer to the tax on the resort fee, and it indicates that the tax was not disclosed online. Construing the Complaint in a reasonable and plausible manner most favorable to Plaintiff, its allegations place Defendants on notice of this aspect of Plaintiff s claim. Defendants' remaining arguments regarding what they say is the actual adequacy of disclosure rest on questions of reasonableness, and in this case-particularly given Plaintiffs substantially unmet contention that the total invoiced amount was never disclosed on the website-are not appropriate for resolution at the pleading stage.

         Second, Defendants maintain that Plaintiff has not pleaded an "ascertainable loss, " as required by the CFA, because he does not aver that he received something less than promised, and has not proffered the cost of comparable hotel rooms. The CFA does not define what constitutes an "ascertainable loss, " but the New Jersey Supreme Court has clarified that the loss must be "quantifiable or measurable." Thiedemann v. Mercedes-Benz USA, LLC, 872 A.2d 783, 792 (N.J. 2005). Therefore, a plaintiff must only "provide a reasonable basis for valuation that is not speculative or unqualified." Smajlaj v. Campbell Soup Co., 782 F.Supp.2d 84, 103 (D.N.J. 2011).

         Here, Plaintiff alleges that he purchased a hotel room that he would not have purchased, absent Defendants' deception. Plaintiffs Complaint identifies the advertised cost of the room, allegedly undisclosed or misrepresented costs and taxes, and the final cost stated on the invoice presented after his hotel stay. Complaint, ¶¶ 58-62. As a matter of pleading, the lack of a specifically alleged comparator does not render Plaintiffs loss hypothetical or illusory. In all of the cases to which Defendant cites, the plaintiffs' claims and injuries related to the quality and value of a promised product, not the quality and value of a product actually received.[3] In such cases, the difference in value between them necessarily must be quantified in order to establish loss. In contrast, the present Plaintiffs allegedly defeated expectations relate to the price that he was led to believe that he would pay for the product versus the price ultimately charged, and not to a deficiency in or misrepresentation about ...


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