glynnis bohannon vs. facebook, inc. complaint

8/2/2019 Glynnis Bohannon vs. Facebook, Inc. Complaint

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'Firs,t Amended SUMMONS SUM-10(0(CITACION JUDICIAL) FRCUTUEOL(SOLO PARA USO DE LA CORT5E7jTO DEFENDANT: E'ACEBOOK, INC.VISO AL DEMANDADO): Th 1 )--

U ARE BEING SUED BY PLAINTIFF: GLYNNIS BOHANNON,DEMANDANDO EL DEMANDANTE): individual ly and onof her minor child I.B. and on behalf of allsimilarly situated,NOTICEI You have been sued. The court may decide against you without your being heard unless you respond within 30 days. Read the information

You have 30 CALENDAR DAYS after this summons and legal papers are served on you to file a written response at this court and have a copyon the plaintiff. A etter or phone call will not protect you. Your written response must be in proper legal form if you want the court to hear you:.There may be a court form that you can use for your response. You can find these court forms and more information at the California CourtsSelf-Help Center (www.courtinfo,ca.gov/sefhep), your county law library, or the courthouse nearest you. If you cannot pay the filing fee, askcourt clerk for a ee waiver form. Ifyou do not file your response on time, you may lose the case by default, and your wages, money, and propertytaken without further warning from the court..There are other legal requirements. You may want to call an attorney right away. If you do not know an attorney, you may want to call an attorneyIf you cannot afford an attorney, you may be eligible for free legal services from a nonprofit legal services program. You can locatenonprofit groups at the California Legal Services Web site (www.lawhe/pcalifornia.org), the California Courts Online Self-Help Centerocagovlselfhelp), or by contacting your local court or county ba r association. NOTE: The court has a statutory lien for waived fees andon an y settlement or arbitration award of $10,000 or more ina civil case. The court's lien must be paid before the court will dismiss the case.Lo han demandado. Si1 no responde den tro de 30 di'as, la Corte puede decidir en su contra sin escuchar su version, Lea /a inforinacibn a

Tiene 30 DIAS DE CALENDA RIO despu~s de que le entreguen esta citacibn ypapeles lega/es para presentar una respuesta per escrito en estay hacer qUe se entregUe una copia al demandante. Una carfa o una flamada telefdnica no lo protegen. Su respuesta por escrito tiene que estarlegal corrocto si desoa qua procesen su caso en/la Corte. Es posible que haya Ufl formularic, que ustedpueda usarpara su respuesta.encontrar estos forrnulariois de Iacodfe y mds informacidn en et Centro de Ayuda de las Codtes de California (www.sucorte.ca.gov), en Iacdeeyes de sU condado a en la Corte que le quede mas cerca. Si no pUede pagar /a cuota de presentacidn, pida a/secretanio de la corted6 Ur formUlaric de exencidn do pago de cuotas. Si no prosenta su respuesta a tiempo, pUedo perder el caso por incump/imionto y ]a code lequirar su sueldo, dinero y biones sin mas advodtencia.Hay otros requisitos legales. Es recomendable qUe llarne aun abogado inmediatamente. Si no conoce a un abogado, puede Ilamar a un servicio deaabogados. Si no pUede pagar a uin abogado, es posible que cumpla con los requisitos para obtener servicios legales gratUitos de unde servicios lega/es sin fines de lucro. Puede encontrar estos grupos sin fines de lucre en e/ sitio web de Ca/ifornia Legal Services,en e/ Centro de Ayuda de las Codtes de California, (www.sucorte.ca.gov) o ponidndose en contacto con/la codte a elde abogados locales. AV/SO: Per ley, la carte tione derecho a reclamar las cuotas y los costos exentos per inlponer un gravamen sebrerecuperacidn de $10,000 6m~s de valor recibicla mediante uin acuerdo e Una concesibn; de arbitraje en un case de derecho civil. Tiene que

gar Li / gamon de la cedte antes do que ]a codte pueda desochar e/ case.I e name andl address ol the court is: CASE NUMBER:nombro y direccidn de la corte es): (N~,,emdel Caso):Clara County Superior Court 11C295N. First Streetn Jose, CA 95113

address, and telephone number of plaintiff's attorney, or plaintiff without an attorney, is:nombre, la direccidn ye! nr~mero do told fono del abogado del domandante, o del domandante quo no tione abogado, es):R. Parker, Jr., Esq. (SBN 257761) 916-448-9800 916-669-4499CUTTER & RATINOFF, LLP AJWatt Avenue ao ,CA 95864 D!A ?Q.. ,Deputy

UA8 011? (Secreta'T c*. (Adjunto)of servi ' f d q4 hs, use Proof of Service ofl Sum mons (form POS-O 10).)pruoba do entrega do es/a citati6n use e/ formularlo Proof of Service of Summons, (P05-010)).NOTICE TO THE PERSON SERVED: You are served1. as an individual defendant.

2. as the person sued under the fictitious name of (specify):3. on behalf of (specify): Ta.CeJ1oi)lb c, V1 C

under: V CCP 416.10 (corporation) CCP 416.60 (minor)SCCP 416.20 (defunct corporation) ~ jCCP 416.70 (conservatee)

ZiiCCP 416.40 (association or partnership) Z CCP 416.90 (authorized person)_____________ ~other (specify).4i\J by personal delivery on (date)' 4) 'il2.- Page lof 1

dopted forMandatory' Use %SUMMONS ' Jeal Code ofCivil Procedur'e 12.20, 465Ju~dicialouncil of California SoutSUM-i 00 [Rev. July 1. 20091 k s


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I C. Brooks Cutter, SBN 121407 w OJohn R. Parker, Jr., SBN 257761 V4~-ikF i 3: 02 KERSHAW, CUTTER &RATINOFF. LLP * (401 Watt Avenue3 Sacramento, CA 958644 Telephone: (916) 448-9800Facsimile: (916) 669-449956 Attorneys for Plaintiff7 SUPERIOR COURT OF THE STATE OF CALIFORNIA8 COUNTY OF SANTA CLARA910 GLYNNIS BOHANNON, individually and onbehalf of her minor child I.B. and on behalf of Case No. 1 12CV21925611 all others similarly situated, FIRST AMENDED CLASS ACTION12 Plaintiffs, COMPLAINT13 v. JIURY TRIAL DEMANDED14 FACEBOOK, INC.,15

Defendant.16 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

1718 Plaintiff Glynnis Bohannon, individually and on behalf of the class described below, by

19 their attorneys, make the following allegations pursuant to the investigation of counsel and based20 upon information and belief, except as to allegations specifically pertaining to Plaintiff and21 counsel, which are based on personal knowledge.22 1. OVERVIEW OF THE ACTION23 1 Plaintiff brings this class action on behalf of herself and other parents and24 guardians whose minor children purchased from defendant Facebook a virtual good, incurring25 charges fo r voidable purchases that Facebook has misrepresented to be "final." and26 nonrefundable.27 2. In addition to its distinction as operator of the largest social network, Facebook28 also provides a paymnent system, Facebook Credits, for users to make purchases within

First Amended Class Action Complaint


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I Facebook. For example, a user can purchase a "virtual flower" to "send" to another friend,2 causing a picture to appear on the friend's page. A user can also use Facebook Credits, which3 the user has purchased from Facebook in exchange for real-world currency, to acquire points,4 coins, or virtual currency within Facebook Applications or "Apps" that appear within the5 Facebook site.6 3. Facebook knows that many of its users are minors. Facebook specifically permits

7minors to register and use its service: Facebook's Statement of Rights and Responsibilities8 requires only that a user be at least thirteen years of age. Furthermore, in order to create a9 Facebook account, a user must specify his or her date of birth. Through its Statement of Rights10 and Responsibilities contract, Facebook specifically requires that -users agree "not [to] provide11I any false personal information on Facebook." Millions of Facebook's users have thereby told12 Facebook that they are minors, and Facebook has actual knowledge of each of its minor users'13 age and status as a legal infant. Furthermnore, users' youth is readily appafent through the14 profiles they create on Facebook. For example, millions of users say they are enrolled in junior15 high school, middle school, or high school.16 4. Facebook has uniformly told all of its users that purchases through Facebook17 Credits are final, including purchases within Apps and purchases of v'irtual goods. Facebook's1I8 Payments Terms says "Don't commit to a transaction unless you are ready to pay, because all19 sales are final." 'When consumers seek refunds f-rm Facebook, Facebook denies that it is20 obliged to provide such refunds.21 5. Plaintiff brings this action for monetary, declaratory and equitable relief under22 California's contract laws, the California Consumers Legal Remedies Act at California Civil23 Code 1750 et seq., California Business and Professions Code Sections 17200 et seq., and/or for24 Unjust Enrichment.25 IL JURISDICTION AND VENUE26 6. This Court has personal and subject matter jurisdiction over this case. This Court27 has personal jurisdiction over Defendant, who is a California citizen. The amount in controversy28 exceeds the jurisdictional minimum for unlimited superior court.



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17. Defendant is a California corporation, has its principal place of business in Palo2 Alto, California, transacts business in this county, has subjected itself to this Court's jurisdiction3 through such activity, and a substantial part of the events and omissions giving rise to the claim4 occurred in this county. Accordingly, venue is proper in this county under Code of Civil5 Procedure 395(a).6 111. PARTIES7 8. Plaintiff Glynnis Bohannon resides in Phoenix, Arizona with her son I.B. l.B.8 joined Facebook on or about July 11, 2011. I.B. was then, and is still now, a minor.9 9. Defendant Facebook is a California corporation with its principal place of10 business in Palo Alto, California.I1I IV. FACTUAL ALLEGATIONS12 10. Facebook describes itself as "a social utility that helps people communicate more13 efficiently with their friends, family and coworkers." Facebook has more than 800 million active14 users worldwide and is the single most visited web site in the United States.15 11. When users make payments within Facebook apps and on the Facebook site,16 Facebook requires that all such payments flow through the Facebook Credits system.17 12. Facebook allows third-party application developers to provide software "'Apps"18 that appear within the Facebook site. Facebook supervises and controls the function and19 operation of the apps it allows to appear on the Facebook platform. Facebook has the right and20 ability to remove any App at any time, or to prevent an App from soliciting or receiving payment

21through Facebook Credits.22 13. In all instances relevant to this action, the purchase and/or purchase of virtual23 goods is a transaction directly between Facebook and the consumer. Facebook charges24 consumers' credit or debit card, PayPal account, mobile phone, or other payment account. No25 App developer ever receives a Facebook customner's payment information.26 14. Facebook users may fund their Facebook Credits purchases by various methods27 including credit card, debit card, Paypal, and mobile phone. Facebook draws funds from the28 specified source to pay for users' purchases. For purchases fr-omi third-party Apps, Facebook

First Amended Class Action Complaint3


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1keeps a 30% fee for itself and forwards the balance to the provider of the App.2 15. Anyone thirteen years old or older can open an account on Facebook. Opening ann1

.~account requires, among other things, selecting a user name and password, providing certain4 contact and other information, and agreeing to Facebook's Statement of Rights and5 Responsibilities which incorporates by reference Facebook's Payment Terms.6 16. Many Facebook apps are targeted to minors. For example, Facebook Apps often7feature cartoon-style images, exaggerated facial features, children within the applications,

8 animals, and other design characteristics consistent with use by minor children.9 17. Many Facebook Apps are, by desigzn, highly addictive. Often, an App presents a

10 virtual environment in which a user seeks to build an imaginary city, farm, or- other facility - a11task made difficult by the limited supplies. Facebook sells Facebook Credits for real money,

12 which allows users to obtain additional supplies to speed progress and otherwise enhance use of13 the App and play of the game.14 18. For example, the App Farm Ville is free for new players to start playing.115 However, the object of the game is to build a thriving virtual farm, a process rendered16 progressively more difficult by inadequate supplies, but the process is greatly sped up by17 obtaining Facebook Credits to be used in the App. By using Facebook Credits to buy a virtual18 "biplane," a FarmVille player can "instant grow" his virtual crops rather than waiting several19 hours for crops to "grow." Similarly, if virtual crops "wither" and "die," a FarmVille player can20 pay real money to "unwither" the crops.21 19. Facebook Credits are obtained by users for consumption in many games and Apps22 that use the same business scheme as FarmVille. For each such game, Facebook and its App23 partners sell Facebook Credits that users must obtain to enjoy the game as it was designed to be24 played. While using such a game, a player sees a screen that sells virtual currency, so that the25 player can "build" thin(ts or-"have" other virtual things.26 20 . In-App purchases and virtual goods are substantial money-makers for Facebook.27 Facebook charges App developers a 30% fee on users' payments via Facebook Credits, and28 Facebook does no t allow App developers to charge users via methods other than Facebook



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1 Credits. Facebook's recent SEC filing indicates that Facebook's revenue from "Payments and2 other fees" was $557 million in 2011.3 21. Facebook has no t offered to return any of the millions of dollars it received from4 minor children's purchases of Facebook Credits for virtual currency or iters within Facebook5 Apps. To the contrary, Facebook has represented that, with regard to Facebook Credits, "all6 sales are final," and that minors and their parents and guardians have no proper claim to refunds7 for purchases originated from accounts that belong to minors-purchases with regard to which8 Facebook is on constructive and actual notice that it is doing business with minors. Facebook9 carefully stores and tracks the personal informnation associated with each Facebook profile and

10 ID, including whether or not the Facebook user is aminor.I1 22 . In October 2011, I.B. (the minor child of Plaintiff Glynnis Bohannon) asked his12 mother Glynnis Bohannon for permission to spend $20 on his Facebook account using Glynnis13' Bohannon's Wells Fargo Master Card. J.B. gave his mother $20 in cash in exchange. He14 purchased Facebook Credits from Pacebook for use in "Ninja Saga." Subsequently, without any15 notice that his mother's credit card information had been stored by Facebook and the Facebook16 Credits system, or that his mother's credit card informnation was being used again after the initial17 $20 purchase, I.B. made in-game purchases in which he thought he was expending virtual, in-18 game currency. In fact, Bohannon's credit card was charged repeatedly, and the charges totaled19 several hundred dollars.20 23 . Upon learning of these charges, Glynnis Bohannon attempted to find a21 mechanism to contact Facebook to dispute the charges. After several hours of searching,22 Bohannon finally found a phone number at Facebook, and she left a message about her problemn,23 to which she has to date received no reply. She was never able to find an email address fo r24 someone at Facebook who could process her complaint. Glynnis Bohannon has still no t received25 a refund.26 V. CLASS ACTION ALLEGATIONS27 24 . Plaintiff brinazs this action as a class action for monetary and equitable relief28 pursuant to California Code of Civil Procedure section 382 , California Civil Code section 178 1,

First Amended Class Actioni Complaint5


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I and applicable case law on behalf of the following class: All parents and legal guardians in the2 United States whose minor children made unauthorized purchases of Facebook Credits from the.3 minor child's Facebook account (the "Class"). Excluded from the Class are Facebook; any4 entity in which it has a controlling interest; any of its parents, subsidiaries, affiliates, officers,5 directors, employees and members of their immediate families: and members of the federal'6 judiciary.7 25. The members of the Class are ascertainable, and are so numerous that joinder is8 impracticable. Plaintiff believes there are thousands of members of the Class, whose names and9 addresses are in Facebook's records.

10 26 . There are questions of law or fact common to the Class, and such questionsI1I predominate over individual questions. Facebook pursued a common course of conduct toward12 the Class as alleged. This action arises out of a common nucleus of operative facts and questions13 of law an d fact which predominate over individual questions. Common questions include:14 (a) Whether Facebook sold in-App purchases and virtual goods;

15(b) Whether Facebook sold in-App purchases and virtual goods to16 minors;17 (c) Whether Facebook knew that many gaming apps are designed to18 induce minors to make purchases;19 (d) Whether Facebook intended for minors to purchase such apps andvirtual currency without the knowledge or authorization of the20 minors' parents or guardians;21 (e) Whether Facebook's sales to minors of in-App purchases andvirtual goods constitute voidable contracts;23 (f) Whether Facebook's scheme to sell in-App purchases and virtualgoods to minors without providing refunds under an y circumstance24 violates California's Consumers Legal Remedies Act, Cal. Civ.Code 1750, and Unfair Competition Law, Business &25 Professions Code 17200 et seq.;26 (g) Whether Facebook represented to minors and their parents and27 guardians that purchases of Facebook Credits arc non-refundable underall circumstances;28

Firsi Amended Class Actioni Complaint6


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(h) Whether Facebook engaged in deceptive, misleading, unfair, fraudulentand/or otherwise unlawful practices through its non-disclosure of2material facts and affirmative misleadingy st -atementsregarding the riuhtsof minors to disaffirm contracts;3 (i) Whether Plaintiff and members of the Class are entitled to recover4 restit'ution of monies remitted to Defendants as a result of the actions5 and omissions alleged herein;6 () Whether Defendant should be enjoined from continuing to makedeceptive, misleading, unfair, fraudulent and/or other-wise unlawful7practices through its non-disclosure of material facts and affirmativemisleading statements regarding the rights of minors to disaffirmn8 contracts;

9(k) Whether Facebook was unjustly enriched by its scheme; and10 (1) Whether Facebook and the Class have been damaged, and if so, in what11I amount.12 27. Plaintiff s claims are typical of the claims of other members of the Class, and13 there is no defense available to Facebook that is unique to Plaintiff. Plaintiff paid hundreds of14 dollars to Facebook for unauthorized purchases made by her minor child.15 28. Plaintiff will fairly and adequately represent the interests of the Class. Plaintiff16 has no interests that are antaglonistic to those of the Class. Plaintiffhas the ability to assist an d17 adequately protect the rights and interests of the Class during the litigation. Further, Plaintiff is

Srepresented by counsel who are competent and experienced in this type of class action litigation.19 29. This class action is not only the appropriate method for the fair and efficient20 adjudication of the controversy, it is the superior method because:21 (a) The joinder of thousands of geographically diverse individual class22 members is impracticable, cumbersome, unduly burdensome, and awaste ofjudicial and litigation resources;23 (b) There is no special interest by class members in individually24 controlling prosecution of separate causes of action;25 (c) Clas's members' individual claims are relatively modest compared

26 with the expense of litigating the claim, thereby making itimpracticable, unduly burdensome, expensive, if not totally27 impossible, to justify individual class members addressing theirloss;28



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(d) When Facebook's liability has been adjudicated, claims of all class1 members can be determined by the Court and administered2 efficiently in a manner ihat is far less erroneous, burdensome, andexpensive than if it were attempted through filing, discovery, and

trial of many individual cases;4 (e) This class action will promote orderly, efficient, expeditious, and5 appropriate adjudication and administration of class claims topromote economies of time, resources, and limited pool of6 recovery;'7 (f) This class action will assure uniformity of decisions among class

8 members;9(g) Without this class action, restitution will not be ordered and9 Facebook will be able to reap the benefits or profits of its10 wrongdoing; and

I11 (h) The resolution of this controversy through this class actionI prsent fewr maagemnt difficulties than individual claims filed

in which the parties may be subject to varying indifferent13 adjudications of their rights.14 30. Further, class certification is appropriate because Facebook has acted, or refused15 to act, on grounds generally applicable to the Class, making class-wide equitable, injunctive,16 declaratory and monetary relief appropriate. In addition, the prosecution of separate actions by17 or against individual members of the Class would create a risk of incompatible standards of

18 conduct for Facebook and inconsistent or varying adjudications for all parties. A class action is19 superior to other available methods for the fair and efficient adjudication of this action.20 VI. CALIFORNIA LAW APPLIES TO THE ENTIRE CLASS

213. California's substantive laws apply to every member of the Class, regardless of22 where in the United States the class member resides. Facebook imposes on its account holders a23 Statement of Rights and Responsibilities contract that must be accepted before becoming an24 account holder and before joining Facebook or making any purchases via Facebook Credits.25 This contract provides as follows:2 6 You will resolve any claim, cause of action or dispute ("claim")27 you have with us arising ou t of or relating to this Statement orFacebook exclusively in a state or federal court located in Santa28 Clara County. The laws of the State of California will govern this



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Statement. as well as any claim that might arise between you andus, without regard to conflict of law provisions. You agree to2 submit to the personal jurisdiction of the courts located in SantaClara County, Califor-nia for the purpose of litigating all such3 claims.4 32 . Further, California's substantive laws may be constitutionally applied to the5 claims of Plaintiff and the Class under the Due Process Clause, 14th Amend. 1, and the Full6 Faith and Credit Clause, Art. IV 1of the U.S. Constitution. California has significant contact,7 or significant aggregation of contacts, to the claims asserted by Plaintiff and all class members,8 thereby creating state interests that ensure that the choice of California state law is not arbitrary9 or unfair.

10 1)- . Facebook's United States headquarters and principal place of business is locatedI I in California. Facebook also owns property and conducts substantial business in California, and12 therefore California has an interest in regulating Facebook's conduct under its laws. Facebook's13 decision to reside in California and avail itself of California's laws, and to engage in the14 challenged conduct from and emanating ou t of California, renders the application of California15 law to the claims herein constitutionally permissible.16 34. California is also the state from which Facebook's alleged misconduct emanated.17 This conduct similarly injured and affected Plaintiff and all other class members.18 35 . The application of California laws to the Class is also appropriate under19 California's choice of law rules because California has significant contacts to the claims of20 Plaintiff and the proposed Class, and California has a greater interest in applying its laws here2 1 than any other interested state.22 NVII. CAUSES OF ACTION23 FIRST CAUSE OF ACTION

24 (Declaratory Judgment)25 36. Plaintiff repeats and re-alleges herein the foregoing allegations.26 37. All Facebook Credit purchases and in-App purchases for virtual goods via27 Facebook Credits that Facebook presents for sale constitutes an offer to enter into a sales28 contract.



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1 -38. By purchasing a virtual good or making a purchasing inside an App, a minor2 accepts Facebook's offer.3 39. Members of the class tendered payment for in-App purchases or virtual goods.4 These payments constitute consideration.540. Accordingly, all transactions that are the subject of this Complaint are possessed

6 of the three elements of a contract, i.e., offer, acceptance and consideration.7 41. Under California law, minors have the right to disaffirm contracts such as those at8 issue here:

Except as otherwise provided by statute, a contract of a minor may9 ~be disaffirmned by the minor before majority or within a reasonable10 time afterwards

I I Cal. Fain. Code 6710,12 42 . California law further provides that a guardian may enforce a minor's rights in a

13civil action or other legal proceeding:A minor may enforce the minor's ri ghts by civil action or other14 legal proceedings in the same manner as an adult, except that a

1 5 guardian must conduct the action or proceedings.16 See Cal. Fain. Code 6601.17 43. The contracts between Defendant and the members of the Class are voidable,18 notwithstanding, Defendant's statements to the contrary.19 44 Accordingly, there is an actual controversy between the parties, requiring a20 declaratory judgment.2145. This claim for declaratory judgment is brought pursuant to 28 U.S.C. 2201 et22seq., seeking a determination by the Court that: (a) this action may proceed and be maintained as23a class action; (b) the contracts between Defendant and the Class members relating to in-App

24 purchases and virtual goods are voidable at the option of the respective class members; (c) if the25 Class members elect to void the contracts, they will be entitled to restitution; (d) an award of26 reasonable attorneys' fees and costs of suit to Plaintiff and the Class; and (e) such other and27 further relief as is necessary and just.28



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I SECOND CAUSE OF ACTION2 (Violation of the California Consumers Legal Remedies Act)3 46. Plaintiff repeats and re-alleges herein the foregoing allegations.4 47. At all times relevant hereto, there was in full force and effect the California5 Consumers Legal Remedies Act ("CLRA"), Cal. Civ. Code 1750.6 48. Plaintiff and the other class members are consumers within the meaning, of Cal.7 Civ. Code 1761 (d).8 49 . Facebook violated the CLRA's proscription against the concealment of the9 characteristics, use, benefit, or quality of goods by actively marketing and promoting its in-App

10 purchases and virtual goods with the statement that purportedly "all sales are final" when in factI1 I that is no t the case. Specifically, Facebook has violated: (a) 1770(a)(5)'s proscription against12 representing that goods have uses or characteristics they do not have; (b) I770(a)(7)'s13 proscription against representing that goods are of particular standard or quality when they are14 of another; (c) I770(a)(14)'s proscription against "Representing that a transaction confers or15 involves rights, remedies, or obligations which it does not have or involve, or which are16 prohibited by law."17 50. Under California law, a duty to disclose arises in four circumstances: (I) when the18 defendant is in a fiduciary relationship with the plaintiff;, (2) when the defendant had exclusive19 knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals20 amaterial fact from the plaintiff, or (4) when the defendant makes partial representations but21 also suppresses some material facts.22 51. Facebook owed a duty to disclose material facts about the Facebook Credit23 transactions embedded in games it marketed, advertised and promoted to minor children, and24 Facebook owed a duty either to be silent as to the finality of the transactions under California25 law or to note that such transactions are no t in fact final under California law. Facebook26 breached such duty as alleged in this Complaint.27 52. Plaintiff and the Class suffered actual damages as a direct and proximate result of28 Facebook's actions, concealment and/or omissions in violation of the CLRA, as evidenced by the

First Amiended Class Action ComplaintI1I


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I substantial sums Facebook pocketed.2 53. Plaintiff, on behalf of herself and for all those similarly situated, demands3 judgment against Facebook for equitable relief in the form of restitution and/or disgorgement of4 funds paid to Facebook.5 54 . In accordance with 1782(a) of the CLRA, counsel will serve Facebook, by6 certified mail, with notice of its alleged violations of the CLRA.7 55. If Facebook does not fully meet the demand se t forth in that letter, then Plaintiff8 will amend or seek leave to amend this complaint in order to seek the following relief under9 CLRA 1780, for Facebook's violations of CLRA 1770(a)(5) and (a)(7):

10 actual damages under Cal. Civ. Code 1780(a)(1);* punitive damages under Cal. Civ. Code 1780(a)(4);12 * attorneys' fees and costs under Cal. Civ. Code 1780(d); and

14 . any other relief the Court deems proper under Cal. Civ. Code 1780(a)(5).15 THIRD CAUSE OF ACTION16 (Violation of Bus. & Prof. Code 17200 et seq.)

1756. Plaintiff repeats and re..alleges herein the foregoing allegations.18 57. Plaintiff brings this cause of action on behalf of herself, on behalf of the other19 class members, and in her capacity as private attorneys general against Facebook for its20 unlawful, unfair, fraudulent and/or deceptive business acts and/or practices pursuant to21 California's Unfair Competition Law (UCL). Business & Professions Code 17200 et seq.,22 which prohibits unlawful, unfair and/or fr-audulent business acts and/or practices.

2358. Plaintiff asserts these claims as a representative of an aggrieved group and as a24private attorney general on behalf of the general public and other persons who have expended

25 funds that Facebook should be required to reimburse under IJCL 17200 et seq.26 59. This claim is predicated on the duty to refr-aini from unlawful, unfair and deceptive27 business practices. Plaintiff and the other class mem-bers hereby seek to enforce a general28 proscription of unfair business practices and the requirement to refrain fr-om deceptive conduct.

First Amended Class Action Comiplaint12


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1 60. Th e UCL 17200 et seq. prohibits acts of "unfair competition." As used in this2 section, "unfair competition" encompasses three distinct types of misconduct: (a)3 "unlawful... business acts or practices;" (b) "unfair fraudulent business acts or practices;" an d (c)4 "unfair, deceptive or misleading advertising."5 61. Facebook violated the UCL by engaging in conduct that violated each of the three6 prongs identified by the statute as set forth throughout this Complaint.7 62. Facebook committed an unlawful business act or practice in violation of the UCL8 17200 et seq. when it violated the CLRA.9 63. Facebook committed unfair and fraudulent business acts and practices in violation10 of the UCL 17200 and I 7500.et seq. by actively advertising, marketing and promoting certain1 ] gamning with the statement that "all sales are final" when Facebook knew that minors were12 making such purchases an d that minors had the right to void such contracts if they so chose.1364. Facebook's deceptive practices were specifically desigzned to induce Plaintiff and

14 the other members of the Class to believe they had no right to receive refunds. when in fact they15 have such a riu2ht.16 65. Facebook's deceptive practices have deceived and/or are likely to deceive17 Plaintiff and members of the consuming public.18 66. As a direct and proximate cause of Facebook's violation of the UCL, Plaintiff and19 the Class have suffered harm in that they have not been reimbursed for the purchases their minor20 children made from Facebook.21 67. As a direct and proximate result of Facebook's violation of the IJCL, Facebook22 has been unjustly enriched and should be required to make restitution to Plaintiff and the Class or23 disgorge its ill-gotten profits pursuant to the UCL 17203 .24 68. Plaintiff, on behalf of herself and for all others similarly situated, demand25 judgments against Facebook for injunctive relief in the form of restitution, and/or disgorgeinent26 of funds paid to Facebook as allegyed herein.27 //28

Fir-st Amended Class Action Complaint13


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I FOURTH CAUSE OF ACTION2 (Unjust Enrichment (alternative claim))3 69. Plaintiff repeats and re-alleges herein the foregoing allegations.4 70. Plaintiff and the Class have conferr ed benefits on Facebook by paying for virtual5 goods and in-App purchases their minor children purchased from Facebook without their6 authorization.7 71. Facebook knowingly and willingly accepted those monetary benefits from8 Plaintiff and the Class.9 72. Under the circumstances alleged herein, it is inequitable for Defendant to retain

10 such benefits at the expense of Plaintiff and the Class.11 73. Facebook has been unjustly enriched at the expense of, and to the detriment of.12 Plaintiff and the Class by wrongfully collecting and retaining money to which Facebook, in13' equity, is no t entitled.14 74. Plaintiff and the Class are entitled to recover from Facebook all amounts15 wrongfully collected and improperly retained by Facebook, plus interest thereon.16 75. As a direct and proximate result of Facebook's unjust enrichment, Plaintiff and1 7 the Class have suffered injury and are entitled to reimbursement, restitution and disgorgement18 from Facebook of the benefits conferred by Plaintiff and the Class.19 76. As a direct and proximate result of Facebook's misconduct as set forth herein,20 Facebook has been unjustly enriched.21 WHEREFORE, Plaintiff, individually and on behalf of the Class, prays for an Order as22 follows:23 A. Findina2 that this action satisfies the prerequisites for maintenance as a class24

action under California Code of Civil ProceduLre section 382. California Civil Code section2526 178 1 an d applicable case law and certifying the Class defined herein;,27 B. Designating Plaintiff as representativ'es of the Class and their counsel as class28 counsel;



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1C. Entering judgment in favor of Plaintiff and the Class and against Facebook;2 D. Entering a Declaratory Judgment determining that the contracts between3 Defendant and the Class members relating to the purchase of Game Currency are voidable at4,5 the option of the respective class members and that if the Class members elect to void the

6 contracts, they will be entitled to restitution;7 E. An injunction that either requires Facebook to cease selling Facebook Credits or8 similar virtual currency to accounts that belong to minors, or to adequately disclose that such9 transactions may be disaffirmed under California law; and10 F. Awarding Plaintiff and members of the Class their individual damages andI1I

12attorneys' fees and allowing costs, including interest thereon; and/or restitution and equitable13, relief; and14 G. Granting such further reli ef as the Court deems just.15 N7111. JURY DEMAND16 Plaintiff demands a trial by jury on all issues so triable.1718 Dated: March 2, 2012 Respectfully submitted,

19 KERSHAW, CUTTER &RATI-NOFF. LLP2021By22 - PakrJr2324252627

First Amended Class Act ion Complaint15


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ATTACHMENT CV-501t2CIVIL LAWSUIT NOTICE1 2CV 9 5-uperior Court of California, Counfy of Santa Clara CASENUtR_-191 N.First St., Sari Jose, CA 95113PLEASREA THIS ENTIRE FORMj

PLAINTIFF (the porson suing): Within 50 days after filng the lawsuit, you must servce@ Dahfendant with the Cornpliiit,Summons, an Alternative Dispute, Resolution (ADR) Information Shoot, anid acopy of this Civil Lawsuit Notice, and you mun[ filewritten proof of such service.DEE (The person siucd): Yo u must do each of the following to protect your righs

1 You must file-awritten response to the Comnplaint, using the pioper legal form? or formnat, in he Clerk's Office of theCourt, within 30 days of the date yo u were served with the Summnns and Complaint:.. You must serve luy nail acopy of your witten response on) th e Plaintiff's'attorney oron the Plaintiff if Plaintiff ha s no1ttolney (to "seiv by mnailo means to have an adult other than youlrqilf mail a opy); and1 You itus! aittend the first Case Manaoerient Confereince.Warning: Ifyou, as the Defendant, do not follow these instructions,you may automatically lose this case,

RULES AND FORMS: YOU must follow the California Rules Of Court and the Superior Court of ClfriCouinty Ot antai GlaraiLocal Civil Rules and use proper forms. You can obtain legal intformation, view the rules and receive form,,, tree of charge, trorthe Self-Flelp Center at 049otrre Darnc Avenue, oin .Joe (408-882-2900 x-2926i), wv.j,; csfsriceon(eetCvl)o ri" State R leus cnd Judiciat Co uncil Porms : -vw~cc u/oei n r:~ri~ ~a .qnrreLocal Rules anid Fonno: h weA'lym~iumiiurLorfjH I 1n~Ir

CASE M1ANAGEMENT CONFERFNCE ICMC): You mUS1 11eet With [T otherT parties and dic~sthe case, in ersort or bytetephorle, at least 30 calrndar days before the CMC. You must also fill out, file anid snirve aCaseo Manaoemnent Sltemtnt(judicial council form CNM-1 it) at le ast 15 calendar days hetfoie thie CMC.You or your attorney must appear at tho CMIC. You ma-yask to Cp~'~~ohn see Locnl GivlORule 8.

Your Case Management Judge Is: Honorable Peter Kirwan eatlt? 8Tho P"CMC isscheduled for: (Cormpleted by Clerli Of COClI)

Date: -- .~ ~ & Time: LOO pr _n Department: 8The next CMC isscheduled for., (Cmpleted by party if he 11t CMC wlas continued or has passed)

Date: ___ ________Time: inDepartment:_..._

ALTERNATIVE DISPUTE RESOLUTION (ADR): Ifall parties have appearedl and tiled a ompleted ABDl Stipulationt Form (localform CV-5008) at least 15 days before, the CMC, the Court will cancel the CMC anid mail notice of an ADR Stotlus Conference,Visit the Court's website at VA/scueirot~rliilD/or call flie ADR Admirnist rater (408-882-2100 X-2530) (foa ist ofADR providers and their qualifications, services, and fees.WARNING: Sanctions may be imposed if ou do not follow the California Rules of Court or the Local Rules of Court.

FcwrnV-60i2. REy 7(01108 CIVIL LAWSUIT NOTICE PA~ I f


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SUPERIOR COURT OF CALWFORNIA, COUNT YOF SANTA CLARAALTERNATIVE lDISPUTE RESOLUTION_______ iNFORM0AION SIFET / CIVIL IVISION

Mvany eases carn breesolved to the satisfaction of all pries without thre necessity o' traditional litigation, which cani be ex ' ensive'ltme O')rrSilring, an d strssfl. The Cort finds that it is in the best irrteresss of the parties; that they plitcipate ini aIremittives totraditional litigation, including arbitrtion, flirdiatlon, lriiral evalurutisn, sIpecial matsters andI refereevcs, and eslrrrreilriea'therefore, all maters shall be referred to ontappropriate form of Alternativec Dispute Resolution (ADR) before; they art wCtorr tri,runless there is good entic to dispense withi he ADR requireenit.

ADR is ire general term fibi a wideariety oifdispute renrluion p(0Cces that are0sltcrnslives Wsitigation. ITypes of AbE.processes irristd mediatin, arbitratiorr, traii-l evanluation, special triasrees andl referes, larid seh nrn q cnfrece, snon otis-.Whiw arehe ii Sun tog Li of schcoior .DR:ts mtoi;( rial 1?

ADR curl have- a numaber of advanttages over litigation;< Ws)it CartSAve time. A tisp te n r, be resolved iii a rmarte r ofnitthis, o evenr weeks, whnI i liigatlirn catirate a enKADRi can save moneir y. Attorney's fees, coons costs, soil expert ftes cars be reduced or avoided al rogetbei.KADi prul'ides more lar tcrisiri bon, Parties riave ore oppnrmrrj iricN with AD?.. t xpre ss their itteretis rind cwrtcenis, insrcod o

Ienreing exclusively on legal rights.KA 01 r avides inr e.errntrot arid flex ilbit ty. Pars ok r:Air Lh msehe AD pirreesl that i.5most hieel y to isrirg ai Sat:stactoryresisiution to their dlispote.< AtM calears eduee at res. AD?. eseuae nqlssa ion arid c ornatnwhile ntiscosrragiis the advcisnlal arrnosjpncre ofI iigahion. Sorseys of parties who hove trwalieipstest in anl AD R process have. fwsrid mnuch greater Nattiafceion than wsirthpiris whos~Ihave, gone through Ilitigatin.Whait ore the nrrrifrmS sr/ADA 0feed by the Lory!?Illftdiasiors siui inforl'3, e;Orttdcntial, 11Cxitsle id inon-bincirsg procQss iii he inserliti Ielps lie pafiies-ru rrlrrssarid theithere er of eseryose inrvolvyed.i arid threnrPractical isl I grl choies. The rrcdi aloe hlipe rise ;rari es to a sin ritc is: it r,

explore legal an d firautin; l settlement uprons, and reach lin uxncceptabitc Sehoruion ofthre p risbteri. Tire mredit or does notdcide the solution to tihe diSPUte; the jairtitS do.Med liarirnr miay be apiproprite. whets;* Th e pairties want a non-idversary proucr*The panties have aeontirruing business or personial relationship

-: CorntrieAtion problem~s urc interfe;rig with a resolsariori


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< Arbitration is a less formal process thanf a la ', with nojusjy. The achitraror hears the. ovicrrice and arguments of the prties, thenmaikes: awritten dirston, The parties can agnreeo binding or non-binding arbitration. In binding arbittation, thearbitrator'r decision is final and-corrapletely resolves the case, without theb pportunity for appeal. In nion-bindingar~bitrarion, the arbitrator's decision could resolve the case, without the Opportunity for appeaiL, unless ia arty timelyrejects thre arbrtrator's decision within 30 days and requests a trial. P~rivate atbirrators are allowed to charge for their time.Arbiuadion ma y be appropiate when:

glynnis bohannon vs. facebook, inc. complaint

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