Case 5:16-cv-00523-RMW Document 39 Filed 05/09/16 Page 1 of 86 1 Jeff D. Friedman (173886) HAGENS BERMAN SOBOL SHAPIRO LLP 2 715 Hearst Avenue, Suite 202 Berkeley, California 94710 3 Telephone: (510) 725-3000 Facsimile: (510) 725-3001 4 [email protected] 5 Steve W. Berman (pro hac vice) HAGENS BERMAN SOBOL SHAPIRO LLP 6 1918 Eighth Avenue, Suite 3300 Seattle, Washington 98101 7 Telephone: (206) 623-7292 Facsimile: (206) 623-0594 8 [email protected] 9 Marc A. Goldich (pro hac vice) AXLER GOLDICH, LLC 10 One Liberty Place 1650 Market Street, Suite 3600 11 Philadelphia, PA 19103 Telephone: (267) 207-2920 12 [email protected] 13 Attorneys for Plaintiffs 14 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA 15 SAN JOSE DIVISION 16 IN RE SEAGATE TECHNOLOGY LLC No. 5:16-cv-00523-RMW LITIGATION 17 CONSOLIDATED AMENDED 18 CONSOLIDATED ACTION COMPLAINT 19 20 21 22 23 24 25 26 27 28 010581-11 872615 V1 Case 5:16-cv-00523-RMW Document 39 Filed 05/09/16 Page 2 of 86 1 TABLE OF CONTENTS 2 Page 3 I. INTRODUCTION ................................................................................................................... 1 4 II. PARTIES ................................................................................................................................. 3 5 III. JURISDICTION AND VENUE .............................................................................................. 4 6 IV. FACTUAL ALLEGATIONS .................................................................................................. 5 7 A. Background Information ............................................................................................. 5 8 1. Hard Drives Generally ..................................................................................... 5 9 2. The Drives ....................................................................................................... 7 10 B. Seagate Markets and Advertises Its Drives as Highly Reliable, Having Extremely Low Failure Rates, and Suitable for RAID and 11 NAS ............................................................................................................................. 8 12 C. Defendant’s Statements and Data Are False, Misleading, and Deceptive, and Defendant Failed to Disclose the Drives’ Defects 13 and Unsuitability for RAID/NAS .............................................................................. 14 14 1. The Backblaze Reports .................................................................................. 14 15 2. The Drives Are Not Designed for RAID 5 and Are Not Suitable for Any Level of RAID or NAS ...................................................... 18 16 3. Defendant Failed to Disclose the Drives’ Defects and Their 17 Unsuitability for RAID and NAS .................................................................. 19 18 D. Seagate’s Warranty on the Drives ............................................................................. 21 19 E. The Plaintiffs’ and the Class’ Experience With Failed Seagate Drives ........................................................................................................................ 22 20 1. Plaintiff Nelson .............................................................................................. 22 21 2. Plaintiff Hauff ................................................................................................ 24 22 3. Plaintiff Schechner ........................................................................................ 26 23 4. Plaintiff Hagey ............................................................................................... 28 24 5. Plaintiff Crawford .......................................................................................... 29 25 6. Plaintiff Ginsberg .......................................................................................... 32 26 7. Plaintiff Manak .............................................................................................. 33 27 8. Plaintiff Enders .............................................................................................. 34 28 CONSOLIDATED AMENDED COMPLAINT - i Case No.: 5:16-cv-00523-RMW 010581-11 872615 V1 Case 5:16-cv-00523-RMW Document 39 Filed 05/09/16 Page 3 of 86 1 9. Plaintiff Dortch .............................................................................................. 35 2 10. Plaintiff Smith ............................................................................................... 37 3 F. Class Members’ Experience with the Drives ............................................................ 38 4 V. CLASS ACTION ALLEGATIONS ...................................................................................... 43 5 VI. VIOLATIONS ALLEGED ................................................................................................... 46 6 FIRST CLAIM FOR RELIEF VIOLATION OF THE CALIFORNIA UNFAIR COMPETITION LAW (ON BEHALF OF PLAINTIFFS AND THE 7 CLASS) ................................................................................................................................. 46 8 SECOND CLAIM FOR RELIEF VIOLATION OF THE CALIFORNIA FALSE ADVERTISING LAW (ON BEHALF OF PLAINTIFFS AND THE 9 CLASS) ................................................................................................................................. 51 10 THIRD CLAIM FOR RELIEF VIOLATION OF THE CALIFORNIA CONSUMER LEGAL REMEDIES ACT (ON BEHALF OF 11 PLAINTIFFS AND THE CLASS) ........................................................................................ 53 12 FOURTH CLAIM FOR RELIEF BREACH OF EXPRESS WARRANTY (ON BEHALF OF PLAINTIFFS AND THE CLASS) ................................................................. 56 13 FIFTH CLAIM FOR RELIEF BREACH OF IMPLIED WARRANTY (ON 14 BEHALF OF ALL PLAINTIFFS AND THE CLASS) ........................................................ 58 15 SIXTH CLAIM FOR RELIEF BREACH OF EXPRESS WARRANTY (ON BEHALF OF THE CALIFORNIA, NEW YORK, ILLINOIS, FLORIDA, 16 MASSACHUSETTS, TENNESSEE, SOUTH CAROLINA, TEXAS, AND SOUTH DAKOTA SUBCLASSES) ........................................................................... 60 17 SEVENTH CLAIM FOR RELIEF BREACH OF IMPLIED WARRANTY (ON 18 BEHALF OF THE CALIFORNIA, NEW YORK, ILLINOIS, FLORIDA, MASSACHUSETTS, TENNESSEE, SOUTH CAROLINA, TEXAS, 19 AND SOUTH DAKOTA SUBCLASSES) ........................................................................... 63 20 EIGHTH CLAIM FOR RELIEF VIOLATION OF THE NEW YORK DECEPTIVE ACTS AND PRACTICES STATUTE (ON BEHALF OF 21 PLAINTIFF CRAWFORD AND THE NEW YORK SUBCLASS) .................................... 65 22 NINTH CLAIM FOR RELIEF VIOLATION OF FLORIDA’S UNFAIR AND DECEPTIVE TRADE PRACTICES ACT (ON BEHALF OF PLAINTIFF 23 SCHECHNER AND THE FLORIDA SUBCLASS) ............................................................ 67 24 TENTH CLAIM FOR RELIEF DECEPTIVE ACTS OR PRACTICES PROHIBITED BY MASSACHUSETTS LAW (ON BEHALF OF 25 PLAINTIFF HAUFF AND THE MASSACHUSETTS SUBCLASS) ................................. 70 26 ELEVENTH CLAIM FOR RELIEF VIOLATION OF ILLINOIS CONSUMER FRAUD AND DECEPTIVE BUSINESS PRACTICES ACT (ON 27 BEHALF OF PLAINTIFF SMITH AND THE ILLINOIS SUBCLASS) ............................ 70 28 CONSOLIDATED AMENDED COMPLAINT - ii Case No.: 5:16-cv-00523-RMW 010581-11 872615 V1 Case 5:16-cv-00523-RMW Document 39 Filed 05/09/16 Page 4 of 86 1 TWELFTH CLAIM FOR RELIEF VIOLATION OF TENNESSEE CONSUMER PROTECTION ACT (ON BEHALF OF PLAINTIFF HAGEY AND 2 THE TENNESSEE SUBCLASS) ......................................................................................... 72 3 THIRTEENTH CLAIM FOR RELIEF VIOLATIONS OF THE SOUTH CAROLINA UNFAIR TRADE PRACTICES ACT (ON BEHALF OF 4 PLAINTIFF DORTCH AND SOUTH CAROLINA SUBCLASS) ..................................... 75 5 FOURTEENTH CLAIM FOR RELIEF VIOLATIONS OF THE TEXAS DECEPTIVE TRADE PRACTICES ACT (ON BEHALF OF 6 PLAINTIFF MANAK AND TEXAS SUBCLASS) ............................................................. 77 7 FIFTEENTH CLAIM FOR RELIEF VIOLATION OF THE SOUTH DAKOTA DECEPTIVE TRADE PRACTICES AND CONSUMER PROTECTION 8 STATUTE (ON BEHALF OF PLAINTIFF NELSON AND THE SOUTH DAKOTA SUBCLASS) ........................................................................................................ 78 9 SIXTEENTH CLAIM FOR RELIEF UNJUST ENRICHMENT (ON BEHALF 10 OF PLAINTIFFS AND THE CLASS) .................................................................................. 79 11 PRAYER FOR RELIEF .................................................................................................................... 80 12 JURY DEMAND ............................................................................................................................... 81 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CONSOLIDATED AMENDED COMPLAINT - iii Case No.: 5:16-cv-00523-RMW 010581-11 872615 V1 Case 5:16-cv-00523-RMW Document 39 Filed 05/09/16 Page 5 of 86 1 Plaintiffs Christopher Nelson (“Plaintiff Nelson”), Dennis Crawford (“Plaintiff Crawford”), 2 Joshuah Enders (“Plaintiff Enders”), Adam Ginsberg (“Plaintiff Ginsberg”), David Schechner 3 (“Plaintiff Schechner”), Chadwick Hauff (“Plaintiff Hauff”), James Hagey (“Plaintiff Hagey”), 4 Nikolas Manak (“Plaintiff Manak”), John Smith (“Plaintiff Smith”) and Dudley Lane Dortch IV 5 (“Plaintiff Dortch”) (collectively “Plaintiffs”), by their designated attorneys, individually and on 6 behalf of all others similarly situated, for their Consolidated Amended Complaint, allege as follows 7 based upon personal knowledge, the