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American Income Life Insurance Co. v. Google, Inc.

United States District Court, N.D. Alabama, Southern Division

September 8, 2014

AMERICAN INCOME LIFE INSURANCE COMPANY; SCOTT SONNEBERG, Plaintiffs,
v.
GOOGLE, INC., Defendant.

MEMORANDUM OPINION

SHARON LOVELACE BLACKBURN, District Judge.

On May 23, 2012, the Magistrate Judge filed his Report and Recommendation, (doc. 26), [1] recommending that defendant's Motion to Dismiss, (doc. 5), be granted and that all claims against defendant, Google, Inc., be dismissed with prejudice, (doc. 26 at 9). Plaintiffs, American Income Life Insurance Company and Scott Sonneberg, filed Rule 72(b)(2) Objection to, and 28 U.S.C. § 636(b)(1)(A) Motion to Reconsider Magistrate Judge's Recommendation That Motion to Dismiss Be Granted and Magistrate's Order Denying Plaintiffs' Motion to Remand. (Doc. 28.) Based upon the court's consideration of all the materials in its file, the Motion to Reconsider is due to be denied, the Objection is due to be overruled, the Magistrate Judge's Recommendation is accepted, and the Motion to Dismiss will be granted.

I. STATEMENT OF FACTS

The Report and Recommendation contains the following statement of "Facts and Procedural History":

Plaintiffs American Income Life Insurance Company and Scott Sonnenberg (collectively "plaintiffs") filed this action in the Circuit Court of Jefferson County, Bessemer Division, against Google and "X and Y, fictitious parties operating websites Google, Inc., chooses to reward with prominent placement in all its search engine results, known only to Plaintiff[s] as operators of pissedconsumer.com' and scam.com.'" (Doc. 1-1 at 6). The substance of plaintiffs' Complaint is that certain business practices by defendants violate the Alabama Deceptive Trade Practices Act, Alabama Code § 8-19-1 et seq., ("ADTPA"). ( Id. at 6-11). Specifically, plaintiffs allege:
The Fictitious Defendants' banners and content, broadcast via Defendant Google, Inc.'s search engine throughout Alabama, via hundreds of thousands of computer terminals, violates the Alabama Deceptive Trade Practices Act by falsely asserting that "American Income Life is a Scam, " and Defendant Google, Inc., has knowingly, since delivery of the 15-Day Alabama Deceptive Trades Practices Act Letter to Defendant Google, Inc., dated July 2, 2011... intentionally disparaged the goods, services, or business of Plaintiff[s] by false and/or misleading representations of fact prohibited by Code of Ala., § 8-19-5(8) and (20).

( Id. at 9 ¶ 13)(emphasis added). Plaintiffs further allege that Google "touts its patented Page Rank' algorithm (also called a Black Box algorithm') to analyze which sites are the best sources of information across the web' for its seller-assisted marketing plan" and that this algorithm has "afforded prominent placement in its search engine broadcasting to the Fictitious Defendants, as part of the seller-assisted marketing place of Defendants, for several years." ( Id. at 8-9 ¶¶ 11-12). Plaintiffs seek monetary damages under ADTPA and to enjoin Google from doing business in the State of Alabama until its alleged violations of ADTPA cease. ( Id. at 10-11).

Google timely removed the case to this court on December 7, 2011, premised upon diversity jurisdiction, 28 U.S.C. § 1441(a). (Doc. 1). Plaintiffs moved to remand the action, which this court denied. (Docs. 13 & 20). Relevant at this stage of the litigation, fictitious party pleading is generally not permitted in federal court, and plaintiffs have made no showing that any limited exception might apply here. See, e.g., Richardson v. Johnson, 598 F.3d 734, 738 (11th Cir. 2010)("As a general matter, fictitious-party pleading is not permitted in federal court."); CSX Transp., Inc. v. United Transp. Union, 2007 WL 1643172, *1 n.1 (11th Cir. June 7, 2007)("the Federal Rules do not authorize suit against fictitious parties").

(Doc. 26 at 1-3 [emphasis in original].)

Although plaintiffs object that the factual allegations of their Complaint were not viewed in the light most favorable to them, ( see doc. 28 at 7), they have not objected to any specific fact set forth in the Report and Recommendation that was not viewed in their favor. The court has reviewed the plaintiffs' Complaint and finds that the facts set forth in the Report and Recommendation summarize appropriately the facts stated in the Complaint. For purposes of the court's ruling on plaintiffs' Objections and Motion to Reconsider the court ACCEPTS the Magistrate Judge's statement of the Facts and Procedural History.

In addition, the court notes the following additional facts are relevant to this court's review:

1. The Complaint alleges that Sonneberg, "the Alabama State General Agent for Plaintiff American Income Life Insurance Company, " is a "consumer'... of Defendant Google, Inc.'s search engine seller-assisted marketing plan delivering the web pages www.scam.com and www.pissedconsumer.com [hereinafter "gripe sites"][2] to computer terminals throughout Alabama as an advertisement driven plan, scheme or system for such services." (Doc. 1-1 at 6.) The Complaint contains no allegation or inference that Sonneberg "[bought] goods or services for personal, family or household use" from Google or the gripe sites, as required to qualify as a consumer under ADTPA, Ala. Code § 8-19-3(2).

The Complaint alleges that Google is engaged in a "seller-assisted marketing plan" pursuant to Ala. Code. § 8-19-5(20). The ADTPA defines a "seller-assisted marketing plan" as "any plan, scheme, or system in which for a consideration a buyer acquires goods or services, or both, together with a plan, scheme, or system for the resale of said goods or services, or both." Ala. Code § 8-19-5(20)(emphasis added). However, the Complaint describes Google as "doing business in Alabama as a computer search engine provider of a seller-assisted marketing plan for the promotion and sale of its services via computer terminals, " (doc. 1-1 at 6-7), and Google "has afforded prominent placement in its search engine broadcasting to the [gripe sites] as part of the seller-assisted marketing plan of Defendants for several years, " ( id. at 9). Plaintiffs' contend:

The Fictitious Defendants'[] banners and content, broadcast via Defendant Google, Inc.'s search engine throughout Alabama, via hundreds of thousands of computer terminals, violated the [ADTPA] by falsely asserting that "American Income Life is a Scam, " and Defendant Google, Inc.[, ] has knowingly, since delivery of the 15-Day [ADTPA] Letter to Defendant Google. Inc., ... intentionally disparaged the goods, services, or business of Plaintiff [American Income Life] by false and/or misleading representations of fact prohibited by Code of Ala., § 8-19-5(8) and (20).

( Id. ) Plaintiffs allege that Google sold advertising to the gripe sites and assisted the gripe sites in achieving prominent placement in search results; this conduct does not constitute a "seller-assisted marketing plan" as defined by the ADTPA. Nothing in the Complaint alleges that Google sold or offered to sell goods and/or services to plaintiffs together with a plan or system for reselling those goods and/or services - as required to qualify as a seller-assisted marketing plan under the ADTPA.

Plaintiffs contend, "Plaintiff American Income Life Insurance Company is not a scam, and is, in fact, a reputable and upstanding business corporation engaged in the lawful and abov[e]-board business of selling insurance polices." (Doc. 1-1 at 9.) The alleged disparaging representation or misrepresentation is the assertion of fact that "American Income Life is a Scam." ( Id. ) The Complaint does not allege that defendant Google created this alleged statement of fact - only that it broadcast the statement and that it did not remove the statement from its web search results. ( Id. at 6-10.)

II. DISCUSSION

A. MOTION TO RECONSIDER - SUBJECT MATTER ...


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