The Franchise Memorandum

After Ralph Lauren Corporation terminated a dealer of 14 years, Victoria Card, Card sued Ralph Lauren in California state court for, among other things, breach of contract, breach of the implied covenant of good faith and fair dealing, misrepresentation, intentional interference with economic advantage, unfair competition under California law, violation of the Robinson-Patman Act, and a RICO Act violation. The case was removed to federal court in California, and that court recently ruled on Ralph Lauren’s motion to dismiss Card’s third amended complaint. Card v. Ralph Lauren Corp., 2020 WL 353464 (N.D. Cal. Jan. 21, 2020). Only Card’s contract claims survived.

The court dismissed Card’s Robinson-Patman Act claim because Card had failed to plead facts sufficient to support a plausible inference that Ralph Lauren had sold the same or similar products to her competitors at lower prices than she was charged. Although Card identified a competitor that she claimed was allowed to sell product at greater discounted rates than she was allowed to sell, the Court noted that the complaint failed to identify any specific products that Ralph Lauren actually sold to that competitor that was also sold to Card. However, because Card plausibly alleged both an injury and a harm to competition from the alleged price discrimination, the court noted it would permit Card to amend her complaint to plead specific facts related to the products that were allegedly sold to Card and the other dealer at different prices. The court dismissed Card’s unfair competition claim under Cal. Bus. and Prof. Code Section 17200 because it was premised on claims the court had already dismissed, including the misrepresentation and Robinson-Patman Act claims, but again allowed Card to re-plead that claim to the extent it was premised on the Robinson-Patman Act. All of Card’s other claims were dismissed without leave to amend in light of the multiple opportunities the court gave Card to cure her pleading deficiencies.