On August 10, 2012, Judge Lindsay granted Match.com’s motion to dismiss a number of purported class actions filed against it in the Northern District of Texas (opinion available here). Plaintiffs were subscribers to Match.com’s online dating services, and filed suit against Match.com claiming that Match.com acted wrongfully by, among other things, failing to remove inactive profiles, falsely labeling inactive profiles as active, failing to police its site from the proliferation of false and fraudulent profiles, failing to remove and block scammers, failing to block IP addresses from certain countries where scamming activity flourishes (e.g., Nigeria), and “falsely representing itself as a legitimate service for single adults and accepting subscription fees from subscribers and then failing to provide the service offered.” Plaintiffs asserted that “as many as 60% (and by some accounts more) of the profiles on the website belong to inactive and/or fake/fraudulent users whose profiles could be viewed by paying subscribers, appear to be active, but who could not be contacted” and “[t]he reason Match does not take any serious measures to rid its site of inactive, fake, or fraudulent profiles and, in fact, takes steps to ensure such profiles remain on the site, is because Match expressly and publicly relies on the artificially inflated number of profiles to demonstrate that it is a growth company, gain prospective subscribers and their payment for joining the site, and retain paying subscribers.”
With respect to plaintiffs’ breach of contract claim, Judge Lindsay found that there is nothing in Match.com’s agreement with its subscribers that requires Match.com to perform the obligations that the plaintiffs alleged that Match.com was required to perform. Nor would a reasonable consumer, according to Judge Lindsay, believe that Match.com would actively police and remove any false or misleading information. Furthermore, “[t]here is nothing in the Agreement that obligates Match.com to conduct its services using only current or ‘active’ profiles.” The agreement “does not state that Match.com is obligated to deactivate or remove profiles visible on its website after subscriptions are cancelled or expire.” “Plaintiffs’ contention that the Agreement obligates Match.com to ensure that member or subscriber profiles are accurate and active runs counter to the specific terms of the Agreement to which they agreed upon subscribing to the service and renewing their subscriptions.” Simply because plaintiffs were disappointed with Match.com’s services does not mean that Match.com breached the terms of its agreement, according to Judge Lindsay.
Judge Lindsay then took up plaintiffs’ DTPA claim, finding that since plaintiffs stated in a conclusory fashion that there was a gross disparity between the value they received and the consideration they paid for Match.com’s services (but did not allege what they paid for their subscriptions), it was impossible for the court to analyze the sufficiency of their claim under Rule 12(b)(6). Accordingly, plaintiffs failed to state a DTPA claim on this ground.
Regarding the parties’ arguments as to whether the conduct alleged by plaintiffs constitutes “unconscionable” conduct that is actionable under the DTPA, Judge Lindsay “move[d] sua sponte for dismissal of Plaintiffs’ DTPA claim based on the Texas Supreme Court’s holding in Crawford v. Ace Sign, Incorporated, 917 S.W.2d 12 (Tex. 1996).” In Crawford, the Texas Supreme Court held that an allegation of a mere breach of contract, without more, does not constitute a “false, misleading, or deceptive act” in violation of the DTPA.” Judge Lindsay stated:
Here, Plaintiffs contracted with Match.com for dating services. Like the plaintiff in Crawford, Plaintiffs contend that Match.com was required to but failed to perform certain obligations under the Agreement, and that Match.com made certain misrepresentations regarding its dating services to get Plaintiffs to subscribe or renew their subscriptions. Boiled down to its essence, Plaintiffs’ DTPA claim is virtually identical to their contract claim that Match.com breached the Agreement. The court further notes that other than alleging their entitlement to treble damages under the DTPA, Plaintiffs’ sole basis for damages is based on the recovery of “compensatory damages in the amount of fees paid for subscriptions to the Match site.” Pls.’ Compl. 3, ¶ 6. Thus, while Plaintiffs pleaded a cause of action under the DTPA, in reality they seek to recover the benefit of their bargain with Match.com. See Crawford, 917 S.W.2d at 13-14. Accordingly, any duty that Match.com had to Plaintiffs arose solely from the Agreement. Id. at 14. The court therefore concludes, based on the reasoning in Crawford, that even if it accepts as true Plaintiffs’ allegations, it appears that their Complaint sounds only in contract, and they have failed to state a claim under the DTPA. Because the court believes that dismissal of Plaintiffs’ DTPA claim is mandated by Crawford, the court does not address the parties’ arguments regarding causation, res judicata, or the applicability of Rule 9(b).
Regarding plaintiffs’ breach of implied covenant of good faith and fair dealing claim, Judge Lindsay found that the agreement itself did not contain any covenant of good faith and fair dealing, and noted that the Texas Supreme Court had declined to read an implied duty of good faith and fair dealing into every contract, instead holding that such a duty arises only as a result of a “special relationship” between parties governed by a contract. This “special relationship” cause of action for breach of the duty of good faith and fair dealing “does not extend to ordinary commercial contractual relationships.” No special relationship existed here, according to Judge Lindsay, because if a subscriber to an online dating service is unhappy with a particular service, he or she can “easily seek out alternative dating services.” Absent a “special relationship,” the duty to act in good faith “is contractual in nature and its breach does not amount to an independent tort.” (citation and quotations omitted). No duty of good faith and fair dealing therefore existed between plaintiffs and Match.com.
Judge Lindsay denied plaintiffs’ request to amend their complaint with respect to their breach of contract claim and breach of the covenant of good faith and fair dealing claim, and dismissed these claims with prejudice. After plaintiffs respond to Judge Lindsay’s sua sponte motion for dismissal of their DTPA claim, Judge Lindsay will determine whether the plaintiffs may amend their complaint with respect to the DTPA claim. Plaintiffs have until August 27 to respond to the Court’s sua sponte motion for the dismissal of plaintiffs’ DTPA claim.
Plaintiffs are represented by Roger Claxton, of The Claxton Law Firm; David Lever and Howard Stolzenberg, both of Lever & Stolzenberg LLP; Evan Spencer, Jeffrey Norton and Randolph McLaughlin, all of Newman Ferrara LLP; Robert Harwood, of Wechsler & Harwood; Norah Hart, of Treuhaft & Zakarin LLP; Peter Malouf, of the Law Office of Peter G. Malouf; Mitchell Toups, of Weller Green Toups & Terrell; Richard Coffman, of the Coffman Law Firm; Vahn Alexander, of Faruqi & Faruqi LLP; and Joseph Marchese, Timothy Fisher, Sarah Westcot, Scott Burser, all of Bursor & Fisher PA.
Match.com is represented by James Maloney, Bryant Boren, Joy Dowdle, and Shira Yoshor, all of Baker Botts LLP.