I found this article describing someone who bought a discount pass for an "indoor playground". In the article, an attorney is quoted:
“These play passes may not fall under the gift card law,” because Barlow says these VIP cards don’t come with a cash value, like gift cards do.
“What the consumer is buying is the play pass itself,” he said.
Shutterfly has terms on their website saying:
Please note: the plan itself has been purchased to buy the physical products at a discounted rate, but the physical products (prints, cards, calendars) have yet to be purchased.
This certainly sounds like an attempt to move the prepaid plan out of the gift-card category. In other words, by putting money into the prepaid account, you have purchased the privilege of obtaining future services from Shutterfly at a discounted rate.
Of course, I'm not an attorney, so I'm just repeating secondhand (or actually thirdhand) information here. You would probably have to consult a lawyer to find out if you could really sue Shutterfly under California law.