Dean Nicosia, on behalf of himself and all others similarly situated, Plaintiff-Appellant,
Amazon.com, Inc., Defendant-Appellee.
Argued: November 30, 2015
Appeal from the United States District Court for the Eastern
District of New York
from a judgment of the United States District Court for the
Eastern District of New York (Townes, J.),
dismissing plaintiff's complaint for failure to state a
claim on the grounds that plaintiff's claims are subject
to mandatory arbitration and denying plaintiffs motion for a
preliminary injunction for lack of standing. We affirm the
district court's denial of plaintiffs motion for a
preliminary injunction, but vacate the dismissal for failure
to state a claim and remand for further proceedings.
in part and Vacated in part and Remanded.
Seth Tusa, Tusa P.C., Southold, New York, Peter D. St.
Phillip, Jr., Scott V. Papp, Lowey Dannenberg Cohen &
Hart, P.C., White Plains, New York, Timothy G. Blood, Paula
M. Roach, Blood Hurst & O'Reardon, LLP, San Diego,
California, and Gregory S. Duncan, Esq., Charlottesville,
Virginia, for Plaintiff-Appellant.
Gregory T. Parks, Ezra D. Church, Morgan Lewis & Bockius
LLP, Philadelphia, Pennsylvania, and Regina Schaffer-Goldman,
Mary Claire Dekar, Morgan Lewis & Bockius LLP, New York,
New York, for Defendant-Appellee.
Before: Sack, Chin, and Lohier, Circuit Judges.
2013, plaintiff-appellant Dean Nicosia purchased 1 Day
Diet, a weight loss product containing sibutramine, a
controlled substance that had been removed from the market in
October 2010, on the website of defendant-appellee
Amazon.com, Inc. ("Amazon"). Nicosia
brought this action below, asserting claims under the
Consumer Product Safety Act (the "CPSA"), 15 U.S.C.
§ 2051 et seq., and state law.
district court (Townes, J.) dismissed the complaint
on the ground that the parties are bound by the mandatory
arbitration provision in Amazon's Conditions of Use. It
found that Nicosia was on constructive notice of the terms
and that he assented to mandatory arbitration when he placed
his order on the website. In the same memorandum and order,
the district court treated Nicosia's motion for
preliminary injunctive relief as a motion for a preliminary
injunction in aid of arbitration, and denied the motion on
the ground that he lacked standing to seek an injunction
blocking Amazon from selling items containing sibutramine and
requiring Amazon to send remedial notices to consumers.
affirm the district court's denial of injunctive relief,
vacate the dismissal for failure to state a claim, and remand
for further proceedings.
As Alleged in the Complaint
is an Amazon customer. On both January 30 and April 19, 2013,
he used the Amazon website to purchase 1 Day
Diet (One Day Diet) Best Slimming Capsule 60
Pills ("1 Day Diet"), a weight loss
drug containing sibutramine. Sibutramine is a Schedule IV
stimulant that was withdrawn from the market in October 2010
by the Food and Drug Administration (the "FDA")
because its association with cardiovascular risks and strokes
outweighed its limited weight loss value. Prior to the
FDA's removal of sibutramine from the market, it was only
available to consumers with a doctor's prescription.
After its removal, the FDA advised physicians to stop
prescribing sibutramine and to advise patients to cease its
consumption due to its risks, including "major adverse
time of his purchase, Nicosia did not know that 1 Day
Diet contained sibutramine and he did not have a
doctor's prescription. Sibutramine was not listed as an
ingredient on Amazon's website or on the 1 Day
Diet packaging, and Amazon sold the product without
requiring a prescription. It was only revealed in November
2013 by the FDA that 1 Day Diet contained
has since stopped selling 1 Day Diet but never
notified Nicosia that 1 Day Diet contained the
stimulant or offered to refund his purchases. As of the
filing of the complaint in July 2014, Amazon continued to
sell other weight loss products identified by the FDA as
containing undisclosed amounts of sibutramine.
Additional Factual Assertions
moving to dismiss the complaint, Amazon submitted a
declaration of a paralegal in its legal department, who
represented that Amazon's records showed that Nicosia
used an Amazon account created on June 9, 2008 to make his
purchases and that the purchases were made in January and
April 2013. Attached to the declaration was a screenshot of
Amazon's account registration webpage apparently in use
in 2008, bearing a copyright notice dated
"1996-2014" (the "Registration Page").
The declaration also attached a screenshot of Amazon's
order page, bearing a copyright notice dated
"1996-2014"; a customer purchasing an item in 2013
apparently would have seen this screen before completing a
purchase. Amazon later submitted a corrected version of the
order page, also bearing a copyright notice dated
"1996-2014" (the "Order
Registration Page and the Order Page both included a link to
Amazon's "Conditions of Use." The Amazon
declaration provided a copy of the conditions of use
apparently in effect in 2013, when Nicosia made his
purchases, as they were last updated December 5, 2012
("2012 Conditions of Use"). They included the
following mandatory arbitration provision:
Any dispute or claim relating in any way to your use of any
Amazon Service, or to any products or services sold or
distributed by Amazon or through Amazon.com will be resolved
by binding arbitration, rather than in court . . . . We each
agree that any dispute resolution proceedings will be
conducted only on an individual basis and not in a class,
consolidated or representative action.
J. App. 20-21 (emphases omitted).
opposition to the motion to dismiss, Nicosia challenged
Amazon's assertions that he had registered for an Amazon
account. He also introduced a copy of Amazon's prior
conditions of use, which his counsel contended were in place
in 2008 ("2008 Conditions of Use"). These did not
include an arbitration provision, but merely included a
choice of forum clause designating "any state or federal
court in King County, Washington, " as the forum with
exclusive jurisdiction and venue over consumer claims
exceeding $7, 500. J. App. 50.
brought this putative class action below against Amazon,
alleging that Amazon had sold and was continuing to sell
weight loss products containing sibutramine to its customers
in violation of the CPSA, 15 U.S.C. §§ 2051-89, and
state consumer protection laws. He alleged additional claims
for breach of implied warranty and unjust enrichment. The
complaint sought both damages and an injunction to prohibit
Amazon from further sale of products containing sibutramine.
suit was filed, Amazon informed the district court that it
intended to move to dismiss the complaint on the ground that
Nicosia was subject to Amazon's mandatory arbitration
provision. The district court stayed discovery pending
resolution of Amazon's anticipated motion to dismiss.
October 2, 2014, Nicosia sought reconsideration of the
district court's stay of discovery with respect to
"subjects put at issue by Defendant's requested
motions to dismiss Plaintiff's individual claims and to
compel arbitration." Pl.'s Ltr. 1, ECF No. 23.
Nicosia requested discovery concerning his "individual
purchases of 1 Day Diet . . . from Amazon, and
discovery supporting Amazon's claims that Plaintiff
provided his individual consent to arbitrate his claims made
in this action." Id. at 2. The district court
denied Nicosia's motion for reconsideration of the
discovery stay, clarifying that "all discovery
in this action is temporarily stayed pending resolution of
the motion to dismiss/ but ruling that »[t]o the extent
limited discovery becomes necessary in connection with a
factual dispute in the anticipated motion to dismiss,
Plaintiff may then submit proposed narrowly-tailored and
specific requests to the Court for approval prior to
propounding any such request." Special App. 4.
moved for preliminary injunctive relief on December 19, 2014,
requesting an order enjoining Amazon from selling weight loss
products containing sibutramine and requiring Amazon to
provide remedial notices to past consumers of those products.
December 24, 2014, Amazon moved to dismiss the complaint.
Amazon did not move to compel arbitration, but instead argued
that the complaint should be dismissed "in favor of
individual arbitration" for failure to state a claim
because Nicosia had agreed to arbitration. Mot. to Dismiss 5,