Belle Chasse Automotive Care, Inc v Advanced Auto - Only the

By Eva Elliott,2014-06-16 23:17
10 views 0
Belle Chasse Automotive Care, Inc v Advanced Auto - Only the ...

     Slip Copy Page 1

    Slip Copy, 2009 WL 799760 (E.D.La.)

     (Cite as: 2009 WL 799760 (E.D.La.))

     Only the Westlaw citation is currently available. Advanced Auto, an automotive retailer, operates in

    several states, including Louisiana. In March 2008, United States District Court,

    Advanced Auto announced to its customers that a E.D. Louisiana. security breach had occurred within its network, and BELLE CHASSE AUTOMOTIVE CARE, INC.,

    that as a result, some of its customers' financial in-Delta Tire Automotive Service, LLC, and Bonnie S.

    formation could have been affected. Advanced Auto May

    took several measures to notify all of its customers v.

    about the breach, including sending out a national ADVANCED AUTO PARTS, INC.

    press release on March 31, 2008. Only fourteen of Civil Action No. 08-1568.

    Advanced Auto's 3,000+ stores, however, actually were affected by the intrusion. One of the impacted March 24, 2009. stores is located in Gretna, Louisiana. Scott R. Bickford, Lawrence J. Centola, III, Martzell Only nine days after the release, Plaintiffs filed suit in & Bickford, New Orleans, LA, Adrian Anthony Colon, this Court, alleging that, as evidenced by the network Jr., Charles Joseph Ballay, Stephen Charles Braud, security breach, Advanced Auto had negligently failed Ballay, Braud & Colon, Belle Chasse, LA, for Belle to adequately protect their financial information. Chasse Automotive Care, Inc. Plaintiffs contend that, as a result, they now have increased risk for credit card fraud and identity theft, Mark Aaron Cunningham, Kathleen Ann Harrison, and need protective measures for credit monitoring. Jones Walker, New Orleans, LA, Mark E. Robinson, Lastly, Plaintiffs allege that they have suffered Timothy H. Madden, Bingham McCutchen, LLP, non-monetary damages, including inconvenience, Boston, MA, for Advanced Auto Parts, Inc. mental anguish, stress, anxiety, fear and emotional distress. Advanced Auto argues that Plaintiffs' claims ORDER AND REASONS should be dismissed. KURT D. ENGELHARDT, District Judge. LAW AND ANALYSIS *1 Before the Court is a Motion To Dismiss and To I. Motion to Dismiss Strike Class Allegations (Rec.Doc.14) filed by the Defendant, Advanced Auto Parts, Inc. (“Advanced In considering a motion to dismiss under Rule Auto”), on June 25, 2008. Advanced Auto moves to 12(b)(6), a court accepts all well-pleaded facts as true dismiss the complaint filed against it by Plaintiffs, and draws all reasonable inferences in favor of the Belle Chase Automotive Care, Inc., Delta Tire & plaintiff. Baker v. Putnal, 75 F.3d 190, 196 (5th Automotive Service, LLC, and Bonnie S. May, for Cir.1996). To avoid dismissal, however, the plaintiff failure to state a claim upon which relief can be must plead “enough facts to state a claim to relief that granted, pursuant to Federal Rule of Civil Procedure is plausible on its face.” Bell Atlantic Corp. v. Twom-12(b)(6), and for lack of subject matter jurisdiction, bly, 550 U.S. 544, 127 S.Ct. 1955, 1974, 167 L.Ed.2d pursuant to Federal Rule of Civil Procedure 12(b)(1). 929 (2007); In re Katrina Canal Breaches Litig., 495 In the alternative, Advanced Auto moves to strike the F.3d 191, 205 (5th Cir.2007).“Factual allegations class allegations contained in the Complaint pursuant must be enough to raise a right to relief above the to Federal Rules of Civil Procedure 12(f) and speculative level on the assumption that all allegations 23(d)(1)(D). For the following reasons, IT IS OR-in the complaint are true (even if doubtful in fact).” DERED that Advanced Auto's motion to dismiss is Twombly, 127 S .Ct. at 1965 (quotation marks, cita-GRANTED. tions, and footnote omitted). BACKGROUND

    ? 2009 Thomson Reuters/West. No Claim to Orig. US Gov. Works.

Slip Copy Page 2

    Slip Copy, 2009 WL 799760 (E.D.La.)

     (Cite as: 2009 WL 799760 (E.D.La.))

    is not an „actual or imminent‟ injury”); Hendricks v. Negligence claims in Louisiana are governed by the DSW Shoe Warehouse, Inc., 444 F.Supp.2d 775, broad language of Louisiana Civil Code Articles 2315 FN1When evaluating claims for negligence 781-82 (W.D.Mich.2006) (plaintiff cannot recover for and 2316.asserted under these articles, Louisiana courts employ “a potential future loss which has not actually oc-a duty-risk analysis. Hence, a plaintiff asserting a curred”); Forbes v. Wells Fargo Bank, N.A., 420 negligence claim must show (and thus allege) that: (1) F.Supp.2d 1018, 1021 (D.Minn.2006) (plaintiff can-the defendant had a duty to conform his or her conduct not recover for the “perceived risk of future harm”).to a specific standard of care; (2) the defendant failed to conform his or her conduct to the appropriate Additionally, three recent decisions from Louisiana standard; (3) the defendant's substandard conduct was federal district courts applying Louisiana law offer the cause-in-fact of the plaintiff's injuries; (4) the significant guidance. In Ponder v. Pfizer, Inc., 522 defendant's substandard conduct was a legal cause of F.Supp.2d 793, 798 (M.D.La.2007) (Brady, J.), an the plaintiff's injuries; and (5) actual damages. See e.g., employee sued his employer, Pfizer, after files con-Roberts v. Benoit, 605 So.2d 1032, 1041-46 (La.1991); taining personal information, including social security Fowler v. Roberts, 556 So.2d 1, 4-9 (La.1989). Ad-numbers, were accessed and copied from a laptop vanced Auto contends that Plaintiffs have failed to computer. At issue were the plaintiff's claims for “fear state an actionable claim because the mere possibility and apprehension of fraud, loss of money, and identity that personal information may be at increased risk theft; the burden and cost of credit monitoring; the does not constitute actual injury sufficient to maintain burden and cost of closing compromised credit ac-a claim of negligence under Louisiana law. counts and opening new accounts; the burden of

     scrutinizing credit card statements and other state-

    ments for unauthorized transactions; damage to credit; FN1.Article 2315 provides: “Every act

    loss of privacy, and other economic damages.” 522 whatever of man that causes damage to F.Supp.2d at 795. Because the plaintiff did not allege another obliges him by whose fault it hap-

    any legally recoverable damages, that is, “that some-pened to repair it.”La. Civ.Code art. 2315.

    one actually used the disclosed information to his Article 2316 provides: “Every person is re-

    detriment,” the court found that he had not stated a sponsible for the damage he occasions not

    viable claim. Id. at 798.merely by his act, but by his negligence, his

    imprudence, or his want of skill.”

     Similarly, in Melancon v. Louisiana Office of Student

    Financial Assistance, 567 F.Supp.2d 873 *2 Advanced Auto is correct that, under Louisiana law,

    (E.D.La.2008) (Barbier, J.), the plaintiffs brought damages must be proved with legal certainty. F.D.I.C.

    class action claims after the Louisiana Office of Stu-v. Barton, 233 F.3d 859, 864 (5th Cir.2000) (citing

    dent Financial Assistance lost some of its backup Craig v. Burch, 228 So.2d 723, 731

    electronic media. The electronic media contained the (La.Ct.App.1969)). Speculative damages may not be

    personal information of individuals who were partic-recovered. Barton, 233 F.3d at 864-65 (citing Bour-

    ipating in financial assistance and scholarship pro-dette v. Sieward, 107 La. 258, 31 So. 630 (La.1902)).

    grams. Id. at 874.The court found that “the mere pos-Pertinent here, a number of courts in other jurisdic-

    sibility that personal information may be at increased tions have held that an allegation of increased risk of

    risk does not constitute actual injury sufficient to identity theft, without more, does not amount to actual

    maintain a claim for negligence under the current state damage. See Pisciotta v. Old Nat'l Bancorp., 499 F.3d

    of Louisiana law.” Id. at 876.629, 639-40 (7th Cir.2007) (“without more than alle- gations of increased risk of future identity theft, the plaintiffs have not suffered a harm that the law is *3 Lastly, Pinero v. Jackson Hewitt Tax Service Inc., prepared to remedy”); Kahle v. Litton Loan Servicing Civil Action No. 08-3535, 2009 WL 43098 LP, 486 F.Supp.2d 705, 712 (S.D.Ohio 2007) (plain-(E.D.La.1/7/09) (Vance, J.), is directly on point here. tiff cannot recover when “no unauthorized use of her In Pinero, the plaintiff brought an action against personal information has occurred”); Key v. DSW, Inc., Jackson Hewitt alleging negligence in mishandling 454 F.Supp.2d 684, 690 (S.D.Ohio 2006) (“[i]n the her confidential personal information and violations of identity theft context, courts have embraced the gen-the Louisiana Database Security Breach Notification eral rule that an alleged increase in risk of future injury Law (LDSBNA), LA. REV. STAT. 51:3071, et seq.

    ? 2009 Thomson Reuters/West. No Claim to Orig. US Gov. Works.

     Slip Copy Page 3 Slip Copy, 2009 WL 799760 (E.D.La.)

     (Cite as: 2009 WL 799760 (E.D.La.))

    2315. Even assuming that credit monitoring should be The court held, however, that the plaintiff did not

    treated the same as medical monitoring responsive to sustain the actual damages necessary to satisfy her

    significant asbestos exposure, the Louisiana legisla-Louisiana law negligence claim. See Pinero, 2009 WL

    ture, in 1999, amended article 2315 in reaction to 43098 at *3. Specifically, Judge Vance reasoned that

    Bourgeois, to expressly exclude “costs for future merely alleging an increased risk of identity theft,

    medical treatment, services, surveillance, or proce-without further allegations of concrete financial loss

    dures of any kind unless such treatment, services, arising from any negligence, is not enough to support surveillance, or procedures are directly related to a a claim under the governing law. Id. manifest physical or mental injury or disease.”La. Without a doubt, identity theft is presently a serious Civ.Code art. 2315. According to the Louisiana First problem in Louisiana and elsewhere. Indeed, in 2005, Circuit Court of Appeal, in Motorola, Inc. v. Asso-the Louisiana legislature enacted the LDSBNA, in ciated Indemnity Corp., et al, 2002-0716 (La.App. 1 recognition of this growing problem theft. Cir. 6/25/04), 878 So.2d 824, 831, another case cited SeeLA.REV.STAT. 51:3071, et seq. Nevertheless, the by Plaintiffs, this amendment was intended to recog-

    Court agrees that Louisiana law does not recognize a nize and implement the legislature's original intent of

    negligence cause of action based on identity theft that not allowing for these types of claims. 878 So.2d at does not yield actual harm. 833-34. Although the amendment was not applied

    retroactively relative to the Bourgeois plaintiffs, it is now the current law. SeeLa. Civ.Code art. 2315.First, the LDSBNA offers little assistance to Plaintiffs' position. Under that statute, persons can recover actual *4 Beyond providing information regarding Bour-damages resulting from “the failure to disclose in a geois and the 1999 amendment to article 2315, Mo-timely manner ... that there has been a breach of the torola is particularly helpful. Plaintiffs refer to lan-security system resulting in the disclosure of a per-guage therein referring to Louisiana's “generous” son's personal information.”LA. REV. STAT. policy on damages. 878 So.2d at 831. The decision 51:3075. On the other hand, however, the statute does itself, however, is inapposite. Rather, the Motorola not provide a similar remedy for any and all negligent court simply addressed whether an insurance provi-handling of sensitive personal information. Id. Here, sion regarding “damages because of bodily injury” Plaintiffs do not allege in their complaint that Ad-could be interpreted to include claims for medical vanced Auto failed to promptly notify its customers monitoring. It also said nothing about abrogating that a security breach had occurred thereby leaving Louisiana's long-standing general requirement that them at a risk of identity theft. Further, ? 3075 refers to actionable negligence rests upon actual damages. “actual damages.”

    Applying the aforementioned principles here, the Nor are the cases cited by Plaintiffs persuasive in this Court finds that Plaintiffs have alleged only specula-instance. As urged by Advanced Auto in its reply tive damages for which Louisiana law provides no memorandum, Arcilla v. Adidas Promotional Retail remedy. Plaintiffs have not alleged that any third party Operations, Inc., 488 F.Supp.2d 965, 972 accessed their information and stole their identities, or (C.D.Cal.2007), is distinguishable given that it was that any other concrete financial loss resulted from the decided under the Fair and Accurate Credit Transac-alleged negligence. Indeed, Plaintiffs have not alleged tions Act of 2003 (FACTA), which is part of the that any individuals have actually gained access to broader Fair Credit Reporting Act (FCRA), and au-their personal information, or that this information thorizes an award of statutory damages. See15 U.S.C. was used in any unauthorized manner. Finally, given ? 1681c(g). the 1999 amendment to article 2315, Plaintiffs' ar- guments seeking an expansion of Bourgeois are Plaintiffs' reliance on Bourgeois v. A.P. Green Indus-without merit. Accordingly, because Plaintiffs' dam-tries, Inc. ., 716 So.2d 355 (La.1998)) likewise is ages are merely speculative, their claims for negli-unfounded. There, the Louisiana Supreme Court held gence must be dismissed. that employees who had been exposed to asbestos materials could recover the costs of medical moni-In further support of this conclusion, the Court notes toring, despite the absence of an existing actual that in negligence cases, Louisiana law generally does physical injury, under Louisiana Civil Code article

    ? 2009 Thomson Reuters/West. No Claim to Orig. US Gov. Works.

     Slip Copy Page 4

    Slip Copy, 2009 WL 799760 (E.D.La.)

     (Cite as: 2009 WL 799760 (E.D.La.))

    Slip Copy, 2009 WL 799760 (E.D.La.) not allow recovery for emotional damage absent physical injury. The Louisiana Supreme Court has END OF DOCUMENT stated that, “if the defendant's conduct is merely neg- ligent and causes only mental disturbance, without

    accompanying physical injury, illness or other physi-

    cal consequences, the defendant is not liable for such

    emotional disturbance.” Moresi v. Dept. of Wildlife

    and Fisheries, 567 So.2d 1081, 1095 (La.1990). Ex-ceptions to this rule are recognized, however, when

    special circumstances “serve[ ] as a guarantee that the

    claim is not spurious.” Id. at 1096;see also, e.g., Graham v. Western Union, 109 La. 1069, 34 So. 91

    (1903) (allowing recovery for emotional damages

    resulting from the failure to deliver a telegraph to a

    mother announcing the impending death of her son);

    Cooper v. Christensen, 212 So.2d 154

    (La.Ct.App.1968) (allowing recovery for mental dis-

    turbance after plaintiff witnessed an automobile

    crashing into her residence); French v. Ochsner Clinic,

    200 So.2d 371 (La.Ct.App.1967) (allowing recovery for mental anguish resulting from an unauthorized

    autopsy); Grather v. Tipery Studios, Inc., 334 So.2d 758 (La.Ct.App.1976) (allowing recovery for photo-

    grapher's negligence regarding wedding photographs).

    Louisiana courts also permit recovery for mental dis-

    tress in certain breach of contract cases, or based upon

    a “separate tort such as assault, battery, false impri-

    sonment, trespass to land, nuisance, or invasion of the

    right to privacy.”Id. at 1095.None of the recognized

    exceptions to the general rule discussed in Moresi are

    implicated in this action. Thus, even if Plaintiffs oth-

    erwise stated valid negligence claims, they cannot recover damages for their alleged emotional injuries.

    II. Motion to Strike Class Allegations

*5 Given that this Court has dismissed Plaintiffs' un-

    derlying substantive claims, Advanced Auto's alter-

    native request that Plaintiffs' class action allegations

    be stricken is moot.


For the reasons set forth above, the Court finds that

    Plaintiffs have not stated a claim upon which relief can

    be granted under Louisiana law. Accordingly, IT IS ORDERED that this action is dismissed.


    Belle Chasse Automotive Care, Inc. v. Advanced Auto

    Parts, Inc.

    ? 2009 Thomson Reuters/West. No Claim to Orig. US Gov. Works.

Report this document

For any questions or suggestions please email