Case Name: Abdullah Uzair v. Google LLC
Case No.: 18-CV-328915

This is a putative class action arising from the automatic renewal of subscriptions for digital content through defendant’s Google Play service. Before the Court is defendant Google LLC’s demurrer to each cause of action in the complaint.

I. Allegations of the Operative Complaint

Google develops and operates Google Play as the official software application or “App” store for the Android operating system, allowing consumers to browse and download Android Apps published by both Google and third-party developers. (Complaint, ¶¶ 20-22.) Through the Google Play Store, defendant offers digital products including songs, movies, television shows, and periodicals through paid subscriptions that are automatically renewed at the end of a definite term for a subsequent term or that continue until the consumer cancels (“In-App subscriptions”). (Id. at ¶ 23.)

To make purchases through Google Play, whether for Google’s or third parties’ applications, consumers use Google Play’s payment system, formerly known as Google Wallets and currently called Google Payments. (Complaint, ¶ 24.) Even for third-party Apps, Google enrolls subscribers, processes payments, and delivers the In-App subscriptions—third-party developers never receive subscribers’ payment information. (Id. at ¶¶ 24-25.) To subscribe, consumers must have a Google Account with a Google ID and password and are required to set up a Google Payments Account by providing their payment information. (Id. at ¶ 26.) During this process, consumers must state that they agree to the Google Play Terms of Service and the Google Payments Terms of Service (“Legal Agreements”), the current versions of which are attached to the complaint. (Ibid.) Consumers accept the Google Play Terms of Service when first using the Google Play Store App and when making a new purchase after the Terms have been updated. (Id. at ¶ 30.) Consumers do not agree to the Google Play Terms of Service prior to each and every purchase. (Ibid.) Rather, when Google Play offers consumers an In-App Subscription, text at the bottom of the screen states: “By tapping ‘subscribe,” you agree to the Terms of Service – Android (US),” with a hyperlink to the Google Payments Terms of Service. (Ibid.)

Plaintiff alleges that Google’s “subscription flow,” including an initial pop up screen summarizing the subscription offer and an expanded summary that may also be viewed by the user, does not disclose that subscriptions will automatically renew until the consumer affirmatively acts to cancel the subscription and does not disclose that any cancellation is not effective until the end of the current billing period, in violation of Business & Professions Code sections 17600-17604, which govern automatic renewal and continuous service offers to consumers in California (the “Automatic Renewal Law”). (Complaint, ¶¶ 34-40.) While these terms are disclosed in the Google Payments Terms of Service, they do not appear until consumers have scrolled through 29-30 screens of information within that document. (Id. at ¶ 41.) The terms consequently are not clear and conspicuous or in visual proximity to the subscription offer, in violation of the ARL. (Ibid.) The Legal Agreements also violate the ARL in that they do not disclose (1) the recurring charges that will be charged to the payment method information as part of the automatic renewal plan, (2) the length of the automatic renewal term or that the service is continuous where the length of the term is not chosen by the consumer, or (3) that there is a minimum purchase obligation; further, the disclosures they do contain are not clear and conspicuous and/or in visual proximity to the offer. (Id. at ¶¶ 44-46.) In addition, defendant’s “subscription flow” does not satisfy the ARL’s requirement of an affirmative consent to the agreement containing the automatic renewal offer terms and, while it sends out confirmation emails, Google fails to provide an acknowledgement that includes the terms, cancellation policy, and information on how to cancel in a manner capable of being retained by the subscriber and that describes a timely, cost-effective and easy to use mechanism for cancellation. (Id. at ¶¶ 50-51.) Finally, Google failes to allow subscribers to cancel before payment as required by the statute. (Ibid.)

Plaintiff resides in California and purchased a family plan subscription to Google Play Music from defendant on March 16, 2016. (Complaint, ¶ 9.)

Because Defendant failed to clearly and conspicuously disclose the automatic renewal offer terms in visual proximity to the request for Plaintiff’s consent to the offer, Plaintiff was not informed prior to purchase that the subscription would renew automatically until cancelled or that any cancellation would not be effective until the next period. Had Defendant made these disclosures, Plaintiff would not have subscribed to Google Play Music at the time he did so.

(Ibid.) Since March 16, 2016, Google has continued to charge plaintiff $14.99 per month on a recurring basis for this Google Play Music subscription. (Ibid.)

Based on these allegations, plaintiff brings putative class claims for (1) ARL violations entitling the class to restition under section 17603 of the ARL (the “gift provision”); (2) Unfair Competition Law (“UCL”) violations; (3) injunctive relief and restitution under Business & Professions Code section 17535 (the False Advertising Act or False Advertising Law or (“FAA” or “FAL”); (4) violation of the Consumer Legal Remedies Act (“CLRA”); (5) common count for money had and received; and (6) declaratory relief.

II. Legal Standard Governing Demurrers

The function of a demurrer is to test the legal sufficiency of a pleading. (Trs. Of Capital Wholesale Elec. Etc. Fund v. Shearson Lehman Bros. (1990) 221 Cal.App.3d 617, 621.) Consequently, “[a] demurrer reaches only to the contents of the pleading and such matters as may be considered under the doctrine of judicial notice.” (South Shore Land Co. v. Petersen (1964) 226 Cal.App.2d 725, 732, internal citations and quotations omitted; see also Code Civ. Proc., § 430.30, subd. (a).) “It is not the ordinary function of a demurrer to test the truth of the plaintiff’s allegations or the accuracy with which he describes the defendant’s conduct. … Thus, … the facts alleged in the pleading are deemed to be true, however improbable they may be.” (Align Technology, Inc. v. Tran (2009) 179 Cal.App.4th 949, 958, internal citations and quotations omitted.)

In ruling on a demurrer, the allegations of the complaint must be liberally construed, with a view to substantial justice between the parties. (Glennen v. Allergan, Inc. (2016) 247 Cal.App.4th 1, 6.) Nevertheless, while “[a] demurrer admits all facts properly pleaded, [it does] not [admit] contentions, deductions or conclusions of law or fact.” (George v. Automobile Club of Southern California (2011) 201 Cal.App.4th 1112, 1120.)

III. The ARL and Plaintiff’s Request for Judicial Notice of Its Legislative History

As an initial matter, the unfair business practices underlying plaintiffs’ claims in this action are Google’s alleged violations of the Automatic Renewal Law, which provides in relevant part:

(a) It shall be unlawful for any business making an automatic renewal or continuous service offer to a consumer in this state to do any of the following:

(1) Fail to present the automatic renewal offer terms … in a clear and conspicuous manner before the subscription or purchasing agreement is fulfilled and in visual proximity … to the request for consent to the offer.
(2) Charge the consumer’s credit or debit card or the consumer’s account with a third party for an automatic renewal … without first obtaining the consumer’s affirmative consent to the agreement containing the automatic renewal offer terms ….

(3) Fail to provide an acknowledgment that includes the automatic renewal … terms, cancellation policy, and information regarding how to cancel in a manner that is capable of being retained by the consumer.…

(Bus. & Prof. Code, § 17602.) The specific “terms” that must be provided are “(1) That the subscription or purchasing agreement will continue until the consumer cancels[;] (2) The description of the cancellation policy that applies to the offer[;] (3) The recurring charges that will be charged to the consumer’s credit or debit card or payment account … [;] (4) The length of the automatic renewal term or that the service is continuous, unless the length of the term is chosen by the consumer[;] (5) The minimum purchase obligation, if any.” (Bus. & Prof. Code, § 17601.)

The ARL also requires businesses to “provide a toll-free telephone number, electronic mail address, a postal address if the seller directly bills the consumer, or it shall provide another cost-effective, timely, and easy-to-use mechanism for cancellation that shall be described in the acknowledgment specified in paragraph (3) of subdivision (a).” (Bus. & Prof. Code, § 17602, subd. (b).)

Plaintiff alleges that Google’s practices violate subdivisions (a)(1)-(3) and (b) of the ARL. For purposes of the present demurrer, Google does not appear to contend that plaintiff’s allegations fail to state a claim for violations of these provisions.

Plaintiff’s request for judicial notice of legislative history materials associated with the ARL is GRANTED. (Evid. Code, § 452, subd. (c).)

IV. The First Cause of Action Under the ARL

Citing Johnson v. Pluralsight, LLC (9th Cir. 2018) 728 Fed. App’x. 674, Lopez v. Stages of Beauty, LLC (S.D. Cal. 2018) 307 F.Supp.3d 1058, and other authorities, Google urges that the ARL does not create a direct cause of action like the one asserted in plaintiff’s first cause of action. Citing Kissel v. Code 42 Software, Inc. (C.D. Cal., Apr. 14, 2016, No. SACV151936JLSKESX) 2016 WL 7647691, plaintiff argues that the ARL does create a direct cause of action. As observed by plaintiff, no published California authority addresses this issue.

A. Legislative Intent to Create a Cause of Action

“Adoption of a regulatory statute does not automatically create a private right to sue for damages resulting from violations of the statute. Such a private right of action exists only if the language of the statute or its legislative history clearly indicates the Legislature intended to create such a right to sue for damages.” (Vikco Ins. Services, Inc. v. Ohio Indem. Co. (1999) 70 Cal.App.4th 55, 62, emphasis original.) “That intent need not necessarily be expressed explicitly, but if not it must be strongly implied.” (Farmers Ins. Exchange v. Superior Court (Ryan) (2006) 137 Cal.App.4th 842, 850.)

General principles of statutory interpretation apply to this analysis. (See Crusader Ins. Co. v. Scottsdale Ins. Co. (1997) 54 Cal.App.4th 121, 133, citing Code Civ. Proc., § 1858.) As recently explained by the California Supreme Court,

[a] statute may contain clear, understandable, unmistakable terms, which strongly and directly indicate that the Legislature intended to create a private cause of action. For instance, the statute may expressly state that a person has or is liable for a cause of action for a particular violation. Or, more commonly, a statute may refer to a remedy or means of enforcing its substantive provisions, i.e., by way of an action. If, however, a statute does not contain such obvious language, resort to its legislative history is next in order.

(Lu v. Hawaiian Gardens Casino, Inc. (2010) 50 Cal.4th 592, 597, internal citations and quotations omitted.)

B. Analysis

Here, plaintiff contends that sections 17603 and 17604 of the ARL create a direct cause of action. Section 17604 states in relevant part that “[n]otwithstanding Section 17534, a violation of this article shall not be a crime. However, all available civil remedies that apply to a violation of this article may be employed.” (Bus. & Prof. Code, § 17604, subd. (a).) The use of the language “all available” indicates that no new private right of action has been created; rather, a party may rely on civil remedies that already exist. For example, a party could bring an action under the UCL or FAL, as plaintiff does here in his second and third causes of action. (See Johnson v. Pluralsight, LLC, supra, 728 Fed. App’x. at p. 676 [“section 17604’s reference to section 17535 evidences the legislature’s intent to permit plaintiffs to pursue an injunction under section 17535 for violations of the ARL as opposed to creating a private cause of action under the ARL.”].)

Plaintiff also relies on section 17603 of the ARL, which provides:

In any case in which a business sends any goods, wares, merchandise, or products to a consumer, under a continuous service agreement or automatic renewal of a purchase, without first obtaining the consumer’s affirmative consent as described in Section 17602, the goods, wares, merchandise, or products shall for all purposes be deemed an unconditional gift to the consumer, who may use or dispose of the same in any manner he or she sees fit without any obligation whatsoever on the consumer’s part to the business, including, but not limited to, bearing the cost of, or responsibility for, shipping any goods, wares, merchandise, or products to the business.

Unlike the examples given by the California Supreme Court in Lu, section 17603’s use of the words “unconditional gift” is not clear and unmistakable indication that the Legislature intended to create a private right of action, such as a reference to a remedy or a means of enforcement. (See Johnson v. Pluralsight, LLC, supra, 728 Fed. App’x. at p. 676 [“Section 17604(a) neither states that a person may “bring an action” to obtain civil remedies nor contains language commonly understood in California to create a “right to bring an action,” quoting Lu].)

As convincingly explained by Lopez, the legislative history also supports the conclusion that violations of the ARL were intended to give rise to claims under previously established remedies and not to a new, standalone claim:

The Senate Judiciary Committee bill analysis states, in relevant part:

[“]Senate Bill 340 would provide that a violation of its provisions would not be a crime, but all applicable civil remedies would be available.

Under the [False Advertising Act], any person who violates any provision of the FAA is liable for a civil penalty not to exceed $2,500 for each violation that must be assessed and recovered in civil action by the Attorney General or by any district attorney, county counsel, or city attorney. Under the UCL, a private party may bring a civil action for injunctive relief and/or for restitution of profits that the defendant unfairly obtained from that party. However, the party must have suffered an injury in fact and lost money or property.[”]

… The analysis also provides that “all civil remedies that apply to a violation may be employed,” and lists “existing law,” including the following California Business & Professions Code sections: § 17200, et seq. (the UCL), § 17500, § 17534, § 17536, § 17204, § 17203, and § 17206. Thus, the committees’ bill analyses specifically contemplate that consumers who suffered an injury by violations of the ARL can seek relief under other statutory provisions, including the UCL.

(Lopez v. Stages of Beauty, LLC, supra, 307 F.Supp.3d at pp. 1067-1068, citations omitted.)

Kissel is not to the contrary. Although it concluded that the ARL created a private right of action, it reasoned that the Legislature “intentionally placed the ARL within the same chapter as § 17535, and … declare[d] certain conduct related to automatic renewal or continuous service offers to be [among the conduct deemed] unlawful [under that chapter].” (Kissel v. Code 42 Software, Inc., supra, 2016 WL 7647691, at *6.) “Accordingly, pursuant to § 17535, injunctive relief and restitution are civil remedies that apply to a violation of the ARL.” (Ibid.) Thus, Kissel merely held that a plaintiff may recover under pre-existing section 17535 for a violation of the ARL.

As explained by both Lopez and Johnson,

Plaintiff’s argument “misse[s] a crucial distinction between the existence of a private right to enforce [the ARL] (such as under the UCL, [False Advertising Law], and/or § 17535), and the existence of an independent cause of action under [the ARL] itself.” Section 17535 “explicitly authorizes a private right of action by ‘any person’ for violations of [Chapter 1 of California’s Business and Professions Code, which includes the ARL].” However, by stating actions “under this section may be prosecuted by … any person who has suffered injury in fact,” the California Legislature clarified its intent “that such a cause of action be pursued under § 17535 itself” and not the ARL.

(Lopez v. Stages of Beauty, LLC, supra, 307 F.Supp.3d at p. 106, quoting Johnson.)

C. Conclusion

Because the ARL does not create a direct cause of action, Google’s demurrer to the first cause of action will be sustained without leave to amend.

V. The Second and Third Causes of Action Under the UCL and FAL and the Sixth Cause of Action for Declaratory Relief

Google demurs to the second cause of action under the UCL on the grounds that plaintiff fails to allege standing, does not allege that he suffered an injury in fact or lost money or property as a result of business practice at issue, and does not allege that he relied on any misleading omission by Google. Google also demurs to the third cause of action under the FAL and the sixth cause of action for declaratory relief; however, it does not address these claims in its memorandum of points and authorities. In its notice of motion, Google appears to take the position that the third and sixth causes of action fail because the second cause of action does. Accordingly, the Court will analyze Google’s demurrer to these three claims together.

Google’s arguments are largely addressed to plaintiff’s fraud theory supporting his UCL claim. However, as urged by plaintiff in opposition, the UCL claim is also based on the theory that under section 17603, products sold in violation of the ARL are deemed unconditional “gifts” to the consumer. In its moving papers, Google addresses the gift theory only in a footnote, urging that section 17603 does not apply here because Google Play Music is an “intangible service.” Google expands on this argument in its reply papers, citing unpublished opinions by this Court (Hon. Kirwan) in Mayron v. Google, Inc. (Super. Ct. Santa Clara County, No. 2015-1-CV-275940). The Court declines to follow Mayron on this point for the reasons discussed below.

A. Principles Governing Statutory Construction

As recently stated by the California Supreme Court,

[w]hen we interpret a statute, our fundamental task is to determine the Legislature’s intent so as to effectuate the law’s purpose. We first examine the statutory language, giving it a plain and commonsense meaning. We do not examine that language in isolation, but in the context of the statutory framework as a whole in order to determine its scope and purpose and to harmonize the various parts of the enactment. If the language is clear, courts must generally follow its plain meaning unless a literal interpretation would result in absurd consequences the Legislature did not intend. If the statutory language permits more than one reasonable interpretation, courts may consider other aids, such as the statute’s purpose, legislative history, and public policy.

(City of San Jose v. Superior Court (Smith) (2017) 2 Cal.5th 608, 616-617, internal citation and quotation omitted.)

“[S]tatutory language, even if it appears to have a clear and plain meaning when considered in isolation, may nonetheless be rendered ambiguous when the language is read in light of the statute as a whole or in light of the overall legislative scheme.” (People v. Valencia (2017) 3 Cal.5th 347, 360.) Courts must accordingly “consider portions of a statute in the context of the entire statute and the statutory scheme of which it is a part, giving significance to every word, phrase, sentence, and part of an act in pursuance of the legislative purpose.” (City of San Jose v. Superior Court, supra, 2 Cal.5th at p. 617.)

Finally, courts must consider “the general rule that civil statutes for the protection of the public are … broadly construed in favor of that protective purpose.” (Pineda v. Williams-Sonoma Stores, Inc. (2011) 51 Cal.4th 524, 530 [interpreting the Song–Beverly Credit Card Act], internal citation and quotation omitted.) While the “mandate to construe a statute liberally in light of its underlying remedial purpose does not mean that courts can impose on the statute a construction not reasonably supported by the statutory language” (Meyer v. Sprint Spectrum L.P. (2009) 45 Cal.4th 634, 645), ambiguous language must be construed to promote the objectives of the statute (People ex rel. Dept. of Transportation v. Muller (1984) 36 Cal.3d 263, 269).

B. Legislative History of the ARL Gift Provision

The declared intent of the Automatic Renewal Law is “to end the practice of ongoing charging of consumer credit or debit cards or third party payment accounts without the consumers’ explicit consent for ongoing shipments of a product or ongoing deliveries of service.” (Bus. & Prof. Code, § 17600.) To that end, businesses that make an automatic renewal or continuous service offer to consumers in California are subject to requirements imposed by section 17602 of the ARL regarding the presentation of the offer’s terms, the charging of consumers’ credit card or other third-party account without affirmative consent, and the provision of an acknowledgement reflecting specified information that is capable of being retained by the consumer.

The author of the bill that became the Automatic Renewal Law explained the need for the statute as follows:

It has become increasingly common for consumers to complain about unwanted charges on their credit cards for products or services that the consumer did not explicitly request or know they were agreeing to. Consumers report they believed they were making a one-time purchase of a product, only to receive continued shipments of the product and charges on their credit card. These unforeseen charges are often the result of agreements enumerated in the “fine print” on an order or advertisement that the consumer responded to. The onus falls on the consumer to end these product shipments and stop the unwanted charges to their credit card.

(Sen. Com. on Judiciary, Analysis of Sen. Bill No. 340 (2009-2010 Reg. Sess.) as amended April 2, 2009.) The author cited a settlement between the Attorneys General of 23 states, including California, and Time Inc. regarding unwanted magazine subscriptions as an example of one “widespread instance of these violations.” (Ibid.)

The language that ultimately became section 17603 was not included in the original bill introduced in the Senate on February 25, 2009. It was first introduced in a June 16, 2009 amendment in the Assembly, with materially the same language as the version that ultimately became law. Using somewhat different language, subsequent legislative history materials described the provision as providing that

in any case in which a business sends any goods, wares, merchandise, or products to a consumer, under a continuous service or automatic renewal, without first obtaining the consumer’s affirmative consent, in the manner required by this bill, then the goods, wares, merchandise, or products shall be deemed an unconditional gift to the consumer, and the business shall bear any shipping or other related costs.

(Assem. Com. on Judiciary, Analysis of Sen. Bill No. 340 (2009-2010 Reg. Sess.) as amended June 24, 2009.) Little further context is provided that would explain why this specific provision was added to the bill.

C. Analysis

In the Court’s view, the language of section 17603 is ambiguous regarding whether that section applies to digital subscriptions like the ones offered by Google. As urged by Google, it is true that the section’s references to “goods, wares, merchandise, or products” and specifically to shipping costs are suggestive of physical items that are shipped to consumers. The ARL is fewer than ten years old, and its authors must have been aware that providers of digital subscriptions could employ the same misleading practices as providers of tangible products; however, the Legislature did appear to be particularly focused on items being shipped to consumers, as evidenced by the repeated references to this practice and to the Time Inc. settlement in the legislative history. Further, while section 17600 refers to “ongoing shipments of a product or ongoing deliveries of service,” section 17603 does not encompass services, suggesting that some practices subject to the requirements of the ARL are not covered by the “gift” provision.

While all of these circumstances suggest a focus on physical goods, they do not ultimately show that the Legislature intended to exclude digital subscriptions from the protections of section 17603. Notably, while the ALR contains at least two references to “shipping” or “shipments” of products, section 17603 uses the broader term “sends” to describe how products within its ambit reach consumers. The Legislature made this choice even though it used the term “shipping” later in section 17603 itself to describe one type of “cost” or “responsibility” that consumers do not bear when a product is deemed a gift. As discussed in plaintiff’s opposition, the term “product” is commonly defined to include digital or intangible goods. Particularly where the Legislature must have been aware that digital subscriptions would be subject to other parts of the ARL, the Court concludes that it would have used more precise language to exclude them from the effects of section 17603 if it meant to.

This conclusion is consistent with a liberal reading of the Automatic Renewal Law to effectuate its purpose “to end the practice of ongoing charging of consumer credit or debit cards or third party payment accounts without the consumers’ explicit consent for ongoing shipments of a product or ongoing deliveries of service.” (Bus. & Prof. Code, § 17600.) There is no obvious reason why the Legislature would declare physical products sent in violation of the ARL “an unconditional gift to the consumer” while allowing businesses to impose obligations on consumers who receive digital subscriptions in violation of the law. Although the costs and logistics associated with sending a physical product back to a business do not exist for digital subscriptions, these are expressly only examples of the obligations that the statute addresses. Indeed, the statute explicitly and broadly encompasses “any obligation whatsoever” by the consumer. It seems clear that one such obligation is the recurring charge to a consumer’s credit card itself—the main problem that the ARL is intended to address. Although Google contends that section 17603 is limited to physical goods, it does not contend that recurring credit card charges are beyond the scope of section 17603 where the subscriptions at issue involve physical goods, and it is unclear why the Legislature would choose to treat digital subscriptions differently in this regard. (See Roz v. Nestle Waters North America, Inc. (C.D. Cal., Jan. 11, 2017, No. 216CV04418SVWJEM) 2017 WL 132853, at *8 [“The clear meaning of [section 17603] is that when a business violates the requirements of [the ARL] when delivering a product to a consumer, that consumer has no obligation to pay the business for the product because it is deemed a gift.”; holding section 17603 provides a basis for restitution]; Lopez v. Stages of Beauty, LLC, supra, 307 F.Supp.3d at p. 1070 [“[W]hen a product is delivered to a consumer in violation of the ARL, it is not considered a product that has been sold, but is considered a gift.”].)

The Court accordingly concludes that section 17603 applies to digital subscriptions. Consistent with this conclusion, the Court of Appeal for the Ninth Circuit recently held in Johnson that a consumer who purchased a subscription to digital content stated a claim under the URL on the theory that the defendant “unlawfully charged him for a subscription that should have been treated as an unconditional gift pursuant to section 17603.” (Johnson v. Pluralsight, LLC, supra, 728 Fed. App’x. at p. 677 [citing Ladore v. Sony Comput. Entm’t Am., LLC (N.D. Cal. 2014) 75 F.Supp.3d 1065, 1073 for the proposition that “the downloadable version of something offered in physical form is a ‘good’ ”].) Under the gift theory, plaintiff alleges both standing and economic loss, and need not allege reliance. (See ibid. [plaintiff alleged standing and economic loss under the UCL through the gift theory]; Lopez v. Stages of Beauty, LLC, supra, 307 F.Supp.3d at p. 1070 [same].) Thus, he states a claim under the UCL based on this theory.

D. Conclusion

Because plaintiff states a claim under the UCL based on his “gift” theory, the Court need not address Google’s arguments regarding his fraud theory in connection with this claim. (See PH II, Inc. v. Superior Court (Ibershof) (1995) 33 Cal.App.4th 1680, 1682-1684 [a demurrer does not lie to a portion of a cause of action].) The demurrer to the second, third, and sixth causes of action will accordingly be overruled.

VI. The Fourth Cause of Action Under the CLRA

“The CLRA proscribes 27 specific acts or practices” in the sale or lease of goods or services to a consumer. (Rubenstein v. The Gap, Inc. (2017) 14 Cal.App.5th 870, 881, citing Civ. Code, § 1770, subd. (a)(1)–(27).) Among those practices is “[r]epresenting that a transaction confers or involves rights, remedies, or obligations that it does not have or involve, or that are prohibited by law” (Civ. Code, § 1770, subd. (a)(14)), the violation asserted by plaintiff here.

Google contends that plaintiff lacks standing to sue under the CLRA because he fails to allege that he “suffer[ed] any damage as a result of” Google’s use “of a method, act, or practice declared to be unlawful by Section 1770.” (Civ. Code, § 1780, subd. (a).) Relatedly, Google urges that plaintiff does not allege an affirmative misrepresentation as required to state a claim under subdivision (a)(14).

A. Actionable Conduct Under Subdivision (a)(14)

As an initial matter, the cases Google cites in support of the proposition that an affirmative misrepresentation is required to state a claim under subdivision (a)(14) do not so hold. (See Rubenstein v. The Gap, Inc., supra, 14 Cal.App.5th at p. 881 [acknowledging that a CLRA claim may arise from a failure to disclose information, but finding the plaintiff did not allege any information was withheld that defendant had a duty to disclose]; Davis v. Ford Motor Credit Co. LLC (2009) 179 Cal.App.4th 581, 599 [plaintiff did not state a CLRA claim because “what Ford represented to Davis was correct, not a misrepresentation”: “Ford was entitled … to allocate payments to the oldest outstanding installment and to assess a late fee on the late installment payments”].) The CLRA sounds in fraud (see Nelson v. Pearson Ford Co. (2010) 186 Cal.App.4th 983, 1023, disapproved on another ground by Raceway Ford Cases (2016) 2 Cal.5th 161), and given that concealment is a species of fraud that is often interchangeable with a claim for affirmative misrepresentation, courts have not required an affirmative misrepresentation to be alleged. (See Outboard Marine Corp. v. Superior Court (Howarth) (1975) 52 Cal.App.3d 30, 36-37 [exclusive remedy provision of the CLRA encompasses claims based on affirmative misrepresentations as well as parallel concealment claims]; Daugherty v. American Honda Motor Co., Inc. (2006) 144 Cal.App.4th 824, 835 [“a claim may be stated under the CLRA in terms constituting fraudulent omissions,” where the omission is “contrary to a representation actually made by the defendant, or an omission of a fact the defendant was obliged to disclose,” citing Outboard Marine].)

Whether characterized as a misrepresentation or as concealment of information that must be disclosed by statute, plaintiff alleges actionable conduct under the CLRA. According to the complaint, Google represented “that it had the right to charge Plaintiff’s and Class Members’ payment methods without first obtaining Plaintiff’s and Class Members’ affirmative consent to the agreement containing the automatic renewal offer terms” and otherwise complying with the ARL. (Complaint, ¶ 77.) Plaintiff alleges that Google does not have the legal right to charge for these subscriptions because it is not in compliance with the Automatic Renewal Law. This theory states a claim under subdivision (a)(14). (See Nelson v. Pearson Ford Co., supra, 186 Cal.App.4th at p. 1023 [finding CLRA violation based on illegal backdating of automobile finance contract; “Pearson Ford violated the CLRA because the second contract represented it had a legal right to collect finance charges effective October 2”].)

B. The CLRA’s Damage Requirement

Finally, Google argues that plaintiff was not damaged by the practice at issue. “Our Supreme Court has interpreted the CLRA’s ‘any damage’ requirement broadly, concluding that the ‘phrase … is not synonymous with “actual damages,” which generally refers to pecuniary damages.’ ” (Hansen v. Newegg.com Americas, Inc. (2018) 25 Cal.App.5th 714, 724, quoting Meyer v. Sprint Spectrum L.P. (2009) 45 Cal.4th 634, 640.) “Rather, the consumer must merely ‘experience some kind of damage,’ or ‘some type of increased costs’ as a result of the unlawful practice.” (Ibid.)

A plaintiff who alleges standing under the UCL generally satisfies the CLRA’s damage requirement as well. (Hansen v. Newegg.com Americas, Inc., supra, 25 Cal.App.5th at p. 733, fn. 8 [“Because we conclude Hansen has adequately alleged ‘economic injury’ for purposes of UCL standing, we likewise conclude he has standing to pursue his CLRA claim.”]; Veera v. Banana Republic, LLC (2016) 6 Cal.App.5th 907, 916 [“the standing requirements of the CLRA are essentially identical to those of the UCL and FAL”].) As explained by the California Supreme Court in Kwikset Corp. v. Superior Court (Benson) (2011) 51 Cal.4th 310, 320 (“Kwikset”), this is generally not a difficult requirement to satisfy:

There are innumerable ways in which economic injury from unfair competition may be shown. A plaintiff may (1) surrender in a transaction more, or acquire in a transaction less, than he or she otherwise would have; (2) have a present or future property interest diminished; (3) be deprived of money or property to which he or she has a cognizable claim; or (4) be required to enter into a transaction, costing money or property, that would otherwise have been unnecessary.
(Id. at p. 323.) Significantly, “ineligibility for restitution is not a basis for denying standing.” (Id. at pp. 335-337, italics added.)

Commonly, UCL standing is established where false advertisements induced a consumer to buy a product he or she would not have purchased otherwise—regardless of whether the product had any actual defect. (See Hinojos v. Kohl’s Corp. (9th Cir. 2013) 718 F.3d 1098, 1104-1107 (“Hinojos”) and Hansen v. Newegg.com Americas, Inc., supra, 25 Cal.App.5th at pp. 724-731 (“Hansen”), both discussing Kwikset.) Thus, in Kwikset, there was UCL standing where a product was mislabeled as “Made in the U.S.A.,” and in Hinojos and Hansen, there was UCL standing where a product was mislabeled as being on sale. The plaintiff need not show that his or her reliance on the defendant’s representation was “the sole or even the predominant or decisive factor” influencing his or her decision to purchase: “It is enough that the representation has played a substantial part, and so had been a substantial factor, in influencing his decision.” (In re Tobacco II Cases (2009) 46 Cal.4th 298, 326-327.)

Here, plaintiff alleges that “[h]ad Defendant complied with its disclosure obligations under § 17602, Plaintiff would not have entered into the subscription at the time he did so.” (Complaint, ¶ 77.) This allegation establishes standing under the CLRA and the UCL. (See Hansen, supra, 25 Cal.App.5th at p.726 [“a consumer’s allegation that he or she would not have purchased a product but for the defendant’s misrepresentation is sufficient to establish economic injury”]; see also In re Adobe Systems, Inc. Privacy Litigation (N.D. Cal. 2014) 66 F.Supp.3d 1197, 1231 [“Plaintiffs allege that they would not have subscribed to Creative Cloud in the first instance had they known of Adobe’s allegedly unsound security practices.”].) This is true even assuming that plaintiff knew that his Google Play Music subscription would automatically renew in some fashion: plaintiff also specifically alleges that he was not informed that any cancellation would not be effective until the next pay period, and he would not have subscribed had Google made this disclosure as required by the ARL. (See Complaint, ¶ 9; see also Mot. at p. 16 [conceding that “[a]t most, [plaintiff] complains that he did not know about Google’s policy not to provide refunds for prior payments when a user cancels”].) Plaintiff consequently alleges damage under the CLRA.

C. Conclusion

For the reasons discussed above, defendant’s demurrer to the fourth cause of action must fail.

VII. The Fifth Cause of Action for Common Count

Finally, Google contends that the fifth cause of action is defective because plaintiff does not allege that the money he paid for Google Play Music was paid by mistake, extortion, oppression, or unfair advantage, since he received the service “that he evidently wanted and knew he was buying” and never sought a refund. (Mot. at pp. 18-19.) While brief and somewhat unclear, defendant’s argument echoes its unsuccessful reasoning attacking plaintiff’s other claims.

In opposition, plaintiff cites authorities tending to support the conclusion that a common count for money had and received is appropriate in the circumstances present here. (See, e.g., J. C. Peacock, Inc. v. Hasko (1961) 196 Cal.App.2d 353, 361 [“fraud may be proved under a complaint on the common count” and it is well-established “that an action for money had and received will lie … where an undue advantage was taken of plaintiffs’ situation whereby money was exacted to which the defendant had no legal right”], internal citations and quotations omitted].) Google does not address these authorities in its reply, and merely argues that this claim must fail because plaintiff’s gift theory fails to support his other claims. Because the gift theory is viable and appears to support a claim for common count, Google’s demurrer to the fifth cause of action will be overruled.

VIII. Conclusion and Order

Google’s demurrer is SUSTAINED WITHOUT LEAVE TO AMEND as to the first cause of action and is otherwise OVERRULED.

The Court will prepare the order.