8/14/2019 EFF: memmtdbready http://slidepdf.com/reader/full/eff-memmtdbready 1/22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VRW WILMER CUTLER PICKERING HALE AND DORR LLP John A. Rogovin (pro hac vice) Randolph D. Moss (pro hac vice) Samir C. Jain # 181572 Brian M. Boynton # 222193 Benjamin C. Mizer (pro hac vice) 1875 Pennsylvania Ave, NW Washington, DC 20006 Tel.: 202-663-6000 Fax: 202-663-6363 Email: [email protected]MUNGER, TOLLES & OLSON LLP Henry Weissmann # 132418 Susan R. Szabo # 155315 Aimee A. Feinberg # 223309 355 South Grand Avenue 35th Floor Los Angeles, CA 90071-1560 Tel.: 213-683-9100 Fax: 213-683-5150 Email: [email protected]Randal S. Milch (pro hac vice) Verizon Communications Inc. One Verizon Way VC43E043 Basking Ridge, NJ 07920 Tel.: 908-559-1752 Fax: 908-696-2136 Attorneys for Verizon Communications Inc. and Verizon Maryland Inc.UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION IN RE: NATIONAL SECURITY AGENCY TELECOMMUNICATIONS RECORDS LITIGATION This Document Relates To: 06-3574, 06-6313, and 06-6570 ) ) ) ) ) ) ) ) ) ) ) ) ) ) MDL NO. 06-1791 VRW MEMORANDUM IN SUPPORT OF VERIZON’S MOTION TO DISMISS THE CHULSKY , RIORDAN , AND BREADY COMPLAINTS Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 1 of 22
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Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VRW
WILMER CUTLER PICKERING HALEAND DORR LLPJohn A. Rogovin (pro hac vice)Randolph D. Moss (pro hac vice)Samir C. Jain # 181572
Brian M. Boynton # 222193Benjamin C. Mizer (pro hac vice)1875 Pennsylvania Ave, NWWashington, DC 20006Tel.: 202-663-6000Fax: 202-663-6363Email: [email protected]
MUNGER, TOLLES & OLSON LLPHenry Weissmann # 132418Susan R. Szabo # 155315Aimee A. Feinberg # 223309355 South Grand Avenue
35th FloorLos Angeles, CA 90071-1560Tel.: 213-683-9100Fax: 213-683-5150Email: [email protected]
Randal S. Milch (pro hac vice)Verizon Communications Inc.One Verizon WayVC43E043Basking Ridge, NJ 07920
Tel.: 908-559-1752Fax: 908-696-2136
Attorneys for Verizon Communications Inc. andVerizon Maryland Inc.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION
IN RE:
NATIONAL SECURITY AGENCYTELECOMMUNICATIONSRECORDS LITIGATION
This Document Relates To:
06-3574, 06-6313, and 06-6570
)))))))))))
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MDL NO. 06-1791 VRW
MEMORANDUM IN SUPPORT OFVERIZON’S MOTION TO DISMISS THECHULSKY , RIORDAN , AND BREADY COMPLAINTS
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 1 of 22
Jeffrey M. Hirsch , Can Congress Use Its War Powers To Protect Military Employees fromState Sovereign Immunity? 34 Seton Hall L. Rev. 999 (2004)................................................. 7
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 5 of 22
Two well-settled principles establish that the Constitution bars state law from regulating the
federal government’s intelligence-collection activities, including any actions the federal governmen
may undertake to collect such intelligence from private parties. First , “several constitutional
provisions commit matters of foreign policy and military affairs to the exclusive control of the
National Government,” Perpich v. Dep’t of Def., 496 U.S. 334, 353 (1990) (emphasis added); In re
World War II , 164 F. Supp. 2d at 1168-70.3
The Founders recognized that among the “principal
purposes to be answered by [the] union” are “[t]he common defence of the members.” The
Federalist No. 23, at 126 (Alexander Hamilton) (E.H. Scott ed. 1898). They accordingly determine
not to leave “the peace of the whole . . . at the disposal of a part .” The Federalist No. 80, at 435
(Alexander Hamilton) (E.H. Scott ed. 1898).
Given the primacy of the federal government in foreign affairs, the Supreme Court has
explained that the states are powerless to act in this field, regardless of whether their actions conflic
with federal policy. Zschernig v. Miller , 389 U.S. 429 (1968). This limitation follows from “both
the text and structure of the Constitution,” In re World War II , 164 F. Supp. 2d at 1168, which
“entrusts [matters of foreign affairs] solely to the Federal Government,” Zschernig, 389 U.S. at 436
(emphasis added), and it thus applies “‘even in [the] absence of a treaty’ or federal statute,’” Deuts
v. Turner Corp., 324 F.3d 692, 709 (9th Cir. 2003) (quoting Zschernig, 389 U.S. at 441); see also I
re World War II , 164 F. Supp. 2d at 1168-70 (state action preempted “‘whether or not consistent
with foreign policy’” (citation omitted)); Jeffrey M. Hirsch, Can Congress Use Its War Powers To
3The Constitution grants Congress the power, inter alia, to “provide for the common
Defence,” U.S. Const. art. I, § 8, cl. 1; to “declare War,” id . cl. 11; to “raise and support Armies,” icl. 12; to “provide and maintain a Navy,” id . cl. 13; and to “provide for calling forth the Militia to. . . suppress Insurrections and repel Invasions,” id . cl. 15. The President “shall be Commander inChief,” id . art. II, § 2, cl. 1, and Chief Executive, id. art. II, § 1, cl. 1, with the “uniqueresponsibility” for the conduct of “foreign and military affairs,” Sale v. Haitian Ctrs. Council, 509U.S. 155, 188 (1993). Meanwhile, Article I expressly limits the role of the states in the realm of war. U.S. Const. art. I, § 10.
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 12 of 22
Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VR
the ways in which the NSA may choose to use private parties.
Plaintiffs’ state law claims are preempted without regard to the existence of any conflict wit
a federal statute. This is not a conflict preemption case; it is a constitutional field preemption case.
Because the Constitution preempts the application of state law in the entire field of the collection o
intelligence for national defense, state law simply may not operate. Conflict is inherent in the state
laws’ very effort to reach into the sphere of national security. See Deutsch, 324 F.3d at 711.
Moreover, the consistency of the alleged NSA programs with federal statutes is irrelevant to the
incapacity of the states to operate in a realm that the Constitution allocates exclusively to the federa
government. The Supreme Court made that much clear long ago in Tarble’s Case, where a state
court judge attempted to issue a writ of habeas corpus to inquire into the military’s custody over an
underage soldier whose enlistment, the state court determined, had “not been made in conformity
with the laws of the United States.” 80 U.S. at 402. The state court lacked the power to issue the
writ, the Supreme Court held, because validity of the federal government’s authority was “to be
determined by the Constitution and laws of the United States,” not by the “officers or tribunals” of
the state. Id . at 409-11.
Within the field of exclusive federal power, state laws cannot be applied, even if those laws
are generally applicable and perfectly valid as applied in other situations. What matters is not the
face of the state law but the effect of its operation. Indeed, Zschernig itself did not turn on “the
words of a statute on its face,” but on “the manner of its application.” 389 U.S. at 433. And the
outcome in Tarble’s Case, too, depended on the application of a general state law authority—the
jurisdiction to issue a habeas writ—to the United States military. 80 U.S. at 402.
For these reasons, Plaintiffs may not apply state law to the military intelligence activities
4In considering motions to remand in this MDL, this Court held that federal common law did
not completely preempt California state law privacy claims because the privacy laws at issue create“an affirmative defense” for reliance on “a legal federal process,” and thus there existed no“significant conflict.” In re NSA Telecomms. Records Litig., MDL No. 06-1791, 2007 WL 163106at *5 (N.D. Cal. Jan. 18, 2007) (“ Riordan”). That holding related to complete preemption (whichrelates to Article III jurisdiction) rather than the analytically distinct category of ordinary preemptio(which relates to legislative jurisdiction), as well as to the strictures of federal common law, whichrequires a finding of substantial conflict. See Boyle v. United Tech. Corp., 487 U.S. 500, 504-08(1988). In the context of field preemption, by contrast, Zschernig and Deutsch make clear that nosuch conflict is required.
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 14 of 22
Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VR
(California Resort Act inapplicable in Yosemite National Park).
Plaintiffs’ own allegations make clear that they are attempting to use state law to regulate th
alleged activities of the NSA. From the outset of their complaint, the Chulsky Plaintiffs, for
example, announce that their “lawsuit challenges Defendants’ illegal actions in permitting the [NSA
and affiliated governmental agencies to . . . conduct surveillance on Defendants’ customers’ . . .
telephone calls and internet communications . . . .” Chulsky Am. Compl. ¶ 1. More generally, each
of the complaints at issue focuses on the propriety of the government’s alleged actions. E.g., Bread
Compl. ¶ 13 (“[T]he United States Government requested that . . . Defendant . . . participate in a
program to monitor and or intercept the telephone and or internet communications, and or records o
those communications, of all their subscribers in order to search for terrorist activity . . . .”); Chulsk
Am. Compl. ¶ 21 (“[T]he NSA accomplishes these surveillance activities through the installation .
of . . . equipment placed on the premises . . . of the Defendants . . . .”); Riordan Compl. ¶ 14
(“Verizon began providing the NSA on an ongoing basis with residential customer telephone callin
records and access to other information about Verizon’s customers and subscribers.”). Plaintiffs’
requested relief would (if there were any merit to their claims) regulate the NSA by enjoining
alleged intelligence programs.
To the extent that Plaintiffs’ dispute is with Verizon, it is only over Verizon’s alleged
assistance to the NSA. Plaintiffs take aim at the alleged cooperation of a purported agent (Verizon
in order to obstruct the alleged activities of the purported principal (the NSA).5
It is well settled th
“[t]he sovereign can act only through its agents,” Kentucky v. Ruckelshaus, 497 F.2d 1172, 1175 (6
Cir. 1974), and that state law “must give way” when it interferes with the federal government’s
authority, regardless of “whether the United States exercises its rights directly or through the use of
private persons,” Union Oil Co. v. Minier , 437 F.2d 408, 411 (9th Cir. 1970). This circumstance is
therefore nothing like cases in which the Supreme Court has held that a generally applicable state
law may lay an incidental burden on the federal government when it is directed principally at a
5 This Court recognized that the complaint in Riordan alleged that Verizon “voluntarily actedas [an] agent[] for the NSA’s purposes” and “in furtherance of NSA’s interests.” Riordan, 2007 W163106, at *9. Based on these allegations, the Court found jurisdiction under the federal officerremoval statute. Id .
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 17 of 22
Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VR
II. THE CHULSKY PLAINTIFFS’ CLAIMS SOUNDING IN FRAUD MUST BE
DISMISSED FOR FAILURE TO PLEAD FRAUD WITH PARTICULARITY
As explained above, all of Plaintiffs’ state laws claims are preempted and thus should be
dismissed. The Chulsky Plaintiffs’ fourth, sixth, and eighth claims should also be dismissed for
failure to plead fraud with particularity, as required by Federal Rule of Civil Procedure 9(b).7 Rule
9(b), which applies to removed actions, see Fed. R. Civ. P. 81(c), provides that “[i]n all averments
fraud . . . , the circumstances constituting fraud . . . shall be stated with particularity.” Fed. R. Civ.
P. 9(b). To plead fraud with particularity, a plaintiff must “state the time, place, and specific conte
of the false representations as well as the identities of the parties to the misrepresentation.” Edwar
v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004) (internal quotation marks omitted); see al
Schreiber Distrib. Co. v. Serv-Well Furniture, Inc., 806 F.2d 1393, 1401 (9th Cir. 1986). Where th
false representation is alleged to have been set forth in a document, the plaintiff must attach the
document or allege the specific content of the document. Edwards, 356 F.3d at 1066.
Plaintiffs’ fourth, sixth, and eighth claims sound in fraud but fail to plead fraud with
particularity. The fourth claim—for “malicious misrepresentation”—alleges that Verizon made
“misrepresentations of material facts that were made knowingly, without belief in its truth, or in
reckless or careless disregard of the truth.” Am. Compl. ¶ 98. As a claim of common law fraud, it
subject to Rule 9(b). See, e.g., F.D.I.C. v. Bathgate, 27 F.3d 850, 876 (3d Cir. 1994). But nowhere
in this claim do Plaintiffs identify with any specificity the misrepresentations allegedly made.
Rather, the claim just vaguely asserts that Verizon “acknowledged [its] duty under the law [to]
protect the confidentiality of Plaintiffs’ telecommunications service information.” Am. Compl. ¶ 9
The sixth claim—for violation of the New Jersey Consumer Fraud Act—asserts that Verizo
has engaged in “deception, fraud, false promises, false pretenses and/or misrepresentations” and tha
it “knowingly and with intent concealed, suppressed or omitted material facts.” Id. ¶¶ 105-106.
Because this claim “sound[s] in fraud,” it is subject to the heightened pleading requirements of Rule
pertaining to national security preempts Plaintiffs’ state law claims. See New SD, Inc. v. Rockwell Int’l Corp., 79 F.3d 953, 955 (9th Cir. 1996); United States v. Pappas, 94 F.3d 795, 801 (2d Cir.1996).
7 Unlike the Chulsky complaint, the Riordan and Bready complaints do not assert claims forfraud.
Case M:06-cv-01791-VRW Document 271 Filed 04/30/2007 Page 19 of 22
Mem. in Support of Verizon’s Motion To Dismiss Chulsky, Riordan, and Bready MDL No. 06:1791-VR
9(b). Naporano Iron & Metal Co. v. American Crane Corp. , 79 F. Supp. 2d 494, 510 (D.N.J. 2000
see also Cinalli v. Kane, 191 F. Supp. 2d 601, 609 (E.D. Pa. 2002); Zebersky v. Bed Bath & Beyond
Inc., No. 06-CV-1735, 2006 U.S. Dist. LEXIS 86451, at *13, 2006 WL 3454993, at *4 (D.N.J. Nov
28, 2006). But the claim again does not identify in any way the statements by Verizon alleged to
have been fraudulent. Instead, the claim references only undescribed “interactions with Plaintiffs.”
Am. Compl. ¶ 106.
Finally, the eighth claim—for “Deceptive Business Practices” and “Fraudulent Use and
Distribution of Items Containing Personal Information of Another”—alleges:
Defendants, through their promotional literature and/or written notices and/or otherwritten material provided to the public and/or the Plaintiffs and New Jersey Class
members represented that the personal, private and confidential records andinformation of the Plaintiffs and New Jersey Class members as set forth herein wouldbe protected from disclosure to and use by the governmental authorities withoutappropriate consent and/or authorization and/or legal authority while at all relevanttimes the Defendants knew such representations to be false.
Id. ¶ 125 (emphasis added). This claim, which sounds in fraud, is subject to the requirements of
Rule 9(b). See Kennedy Funding, Inc. v. Lion’s Gate Dev., LLC , No. 05-4741, 2006 U.S. Dist.
LEXIS 48997, at *7, 2006 WL 1044807, at *5 (D.N.J. July 17, 2006). Again, however, these
allegations of fraud lack the specificity required by Rule 9. Plaintiffs notably fail to identify or
describe in any detail whatsoever (let alone the detail required by Rule 9(b)) the alleged
“promotional literature,” “written notices,” and “other written material” that supposedly contain
false assertions.
For these reasons, the Chulsky Plaintiffs’ fourth, sixth, and eighth claims should be
dismissed.
III. THE CHULSKY PLAINTIFFS’ CONTRACT CLAIMS MUST BE DISMISSED
BECAUSE THEY FAIL TO IDENTIFY THE CONTRACTS AT ISSUE
In addition to being preempted, the Chulsky Plaintiffs’ claims for breach of contract (Claim
III) and for violation of the Truth-in-Consumer Contract, Warranty and Notice Act (Claim VII) als
must be dismissed because Plaintiffs have failed even to identify the contracts they assert are the
basis for their claims.8
To state a claim for breach of contract, a Plaintiff must, at a minimum,
8The Riordan and Bready complaints do not assert contract claims.
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