On September 30, 2010, Magistrate Judge Kaplan of the Northern District of Texas dismissed certain fraud-based claims in a purported class action brought against Match.com (pdf copy of the decision here). Match.com, an operator of an online dating service, was sued for allegedly committing RICO violations and fraudulent acts under Texas law. The plaintiffs’ “core allegation” is that Match.com misrepresents or conceals information with respect to “the number and identity of users who can be reached through [its] websites.” In essence, plaintiffs claim that Match.com advertises that it has 15 million “members” but does not disclose that such members “have limited access to online dating services unless they pay a fee to become ‘subscribers.’” Plaintiffs allege that Match.com has fewer than 1.4 million subscribers.
Judge Kaplan granted Match.com’s motion to dismiss plaintiffs’ fraud-based claims because plaintiffs failed to properly plead the element of reliance (i.e., an essential element of plaintiffs’ fraud, fraudulent inducement, negligent misrepresentation, and DTPA claims). Judge Kaplan rejected plaintiffs’ argument that there is a “presumption of reliance” in fraud cases involving both affirmative misrepresentations and a failure to disclose, and held that “[o]ther than their conclusory allegations of reliance, plaintiffs allege nothing to suggest that they actually relied on any false representation in deciding to become fee-paying subscribers of [Match.com’s] online dating services.” Because the failure to plead facts that establish reliance was fatal to plaintiffs’ fraud-based allegations, Judge Kaplan dismissed such claims with prejudice. (Judge Kaplan dismissed the claims with prejudice given that plaintiffs had already amended their complaint three times.)
Judge Kaplan refused to dismiss plaintiffs’ RICO and breach of contract claims, although Judge Kaplan noted that Match.com could argue for the dismissal of such claims in a motion for summary judgment.
Miriam Zakarin and Norah Hart, of Treuhaft & Zakarin LLP, represent the plaintiffs.
John Cuti and Elisa Miller, of Davis Wright Tremaine LLP, and Scott Barnard and Patrick O’Brien, of Akin Gump Strauss Hauer & Feld, represent Match.com.
