In re Litig..

• Decision Date: 12 May 2011
• Docket Number: No. C 10–02389 JW.,C 10–02389 JW.
• Citation: 791 F.Supp.2d 705
• Parties: In re FACEBOOK PRIVACY LITIGATION.
• Court: U.S. District Court — Northern District of California

791 F.Supp.2d 705

In re FACEBOOK PRIVACY LITIGATION.

No. C 10–02389 JW.

United States District Court, N.D. California,San Jose Division.

May 12, 2011.

Sean Patrick Reis, Edelson McGuire, LLP, Rancho Santa Margarita, CA, Benjamin Harris Richman, Christopher Lilliard Dore, Jay Edelson, Edelson McGuire, LLP, Eric David Freed, Freed & Weiss LLC, Chicago, IL, Charles Hyunchul Jung, Kassra Powell Nassiri, Nassiri & Jung LLP, Michael James Aschenbrener, Aschenbrener Law P.C., Eric H. Gibbs, Girard Gibbs LLP, San Francisco, CA, Jordan L. Lurie, Weiss & Lurie, Los Angeles, CA, Matthew Joseph Zevin, Stanley Iola, LLP, Francis M. Gregorek, Wolf Haldenstein Adler Freeman & Herz LLP, San Diego, CA, Donald Amamgbo, Amamgbo & Associates, Reginald Von Terrell, The Terrell Law Group, Oakland, CA, Reginald Von Terrell, The Terrell Law Group, Richmond, CA, Sydney Jay Hall, Attorney At Law, Burlingame, CA, for Plaintiffs.James M. Penning, Cooley Godward Kronish LLP, Palo Alto, CA, Matthew Dean Brown, Cooley LLP, San Francisco, CA, for Defendant.Richard L. Seabolt, Duane Morris LLP, San Francisco, CA, for Interested Party.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS

JAMES WARE, Chief Judge.

I. INTRODUCTION

Plaintiffs ¹ bring this putative class action against Facebook, Inc. (“Defendant”) alleging violations of the Electronic Communications Privacy Act, 18 U.S.C. §§ 2510, et seq., California's Unfair Competition Law, California Business & Professions Code §§ 17200, et seq. , and breach of contract. Plaintiffs allege that Defendant intentionally and knowingly transmitted personal information about Plaintiffs to third-party advertisers without Plaintiffs' consent.

Presently before the Court is Defendant's Motion to Dismiss.² The Court conducted a hearing on March 28, 2011. Based on the papers submitted to date and oral argument, the Court GRANTS in part and DENIES in part Defendant's Motion to Dismiss.

II. BACKGROUND

In a Consolidated Class Action Complaint ³ filed on October 11, 2010, Plaintiffs allege as follows:

Defendant is a Delaware corporation that maintains its headquarters in Santa Clara County, California. (Complaint ¶ 6.) Defendant operates the world's largest social networking website. ( Id. ¶ 11.) Defendant allows anyone with access to a computer and Internet connection to register for its services free of charge. ( Id. ¶ 12.) One of the few requirements Defendant places on its registrants is that they provide their actual names. ( Id. ¶ 13.) Once registered, a user of Defendant's website may also post personal information to a “profile” webpage. ( Id. ¶ 14.)

Each user of Defendant's website has a user ID number which uniquely identifies that user. (Complaint ¶ 15.) If a person knows the user ID number or “username” of an individual who is a user of Defendant's website, that person can see the user's profile webpage and see the user's real name, gender, picture, and other information. ( Id.)

Defendant now “serves more ad[vertisement] impressions than any other online entity.” (Complaint ¶ 18.) Because it possesses personal information about its users, Defendant's advertisers are able to target advertising to users of Defendant's website. ( Id. ¶ 19.) Defendant's own policies prohibit Defendant from revealing any user's “true identity” or specific personal information to advertisers. ( Id. ¶¶ 20–25.)

When a user of Defendant's website clicks on an advertisement posted on the website, Defendant sends a “Referrer Header” to the corresponding advertiser. (Complaint ¶ 28.) This Referrer Header reveals the specific webpage address that the user was looking at prior to clicking on the advertisement. ( Id.) Thus, Defendant has caused users' Internet browsers to send Referrer Header transmissions which report the user ID or username of the user who clicked on an advertisement, as well as information identifying the webpage the user was viewing just prior to clicking on that advertisement. ( Id.) Because of this, when an advertiser receives a Referrer Header transmission from Defendant, the advertiser can obtain substantial additional information about a user of Defendant's website, such as the user's name, gender and picture. ( Id. ¶ 29.) Through these transmissions, Defendant shares users' personal information with third-party advertisers without users' knowledge or consent, in violation of Defendant's own policies. ( Id. ¶ 27.)

Defendant began these transmissions no later than February, 2010, and they continued until May 21, 2010. (Complaint ¶¶ 31–33.) Software engineers employed by Defendant knew or should have known that these transmissions would divulge private user information to third-party advertisers. ( Id. ¶ 36.) As a result of Defendant's misconduct, Plaintiffs “suffered injury.” ( Id. ¶ 109.)

On the basis of the allegations outlined above, Plaintiffs assert eight causes of action: (1) Violation of the Electronic Communications Privacy Act (“ECPA”), 18 U.S.C. §§ 2510, et seq. ; (2) Violation of the Stored Communications Act, 18 U.S.C. §§ 2701, et seq. ; (3) Violation of California's Unfair Competition Law (“UCL”), Cal. Bus. & Prof.Code §§ 17200, et seq. ; (4) Violation of California's Computer Crime Law, Cal.Penal Code § 502; (5) Violation of the Consumers Legal Remedies Act (“CLRA”), Cal. Civ.Code §§ 1750, et seq. ; (6) Breach of Contract; (7) Violation of Cal. Civ.Code §§ 1572, 1573; and (8) Unjust Enrichment.

Presently before the Court is Defendant's Motion to Dismiss pursuant to Rule 12(b)(1) and Rule 12(b)(6).

III. STANDARDS

A. Lack of Subject Matter Jurisdiction

Rule 12(b)(1) of the Federal Rules of Civil Procedure provides for a motion to dismiss for lack of subject-matter jurisdiction. A Rule 12(b)(1) motion may be either facial, where the inquiry is confined to the allegations in the complaint, or factual, where the court is permitted to look beyond the complaint to extrinsic evidence. Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir.2004). On a facial challenge, all material allegations in the complaint are assumed true, and the question for the court is whether the lack of federal jurisdiction appears from the face of the pleading itself. See Wolfe, 392 F.3d at 362; Thornhill Publishing Co. v. General Telephone Electronics, 594 F.2d 730, 733 (9th Cir.1979). When a defendant makes a factual challenge “by presenting affidavits or other evidence properly brought before the court, the party opposing the motion must furnish affidavits or other evidence necessary to satisfy its burden of establishing subject-matter jurisdiction.” Safe Air For Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir.2004). The court need not presume the truthfulness of the plaintiff's allegations under a factual attack. White v. Lee, 227 F.3d 1214, 1242 (9th Cir.2000); Augustine v. United States, 704 F.2d 1074, 1077 (9th Cir.1983). However, in the absence of a full-fledged evidentiary hearing, disputes in the facts pertinent to subject-matter are viewed in the light most favorable to the opposing party. Dreier v. United States, 106 F.3d 844, 847 (9th Cir.1996). The disputed facts related to subject-matter jurisdiction should be treated in the same way as one would adjudicate a motion for summary judgment. Id.

B. Failure to State a Claim

Pursuant to Federal Rule of Civil Procedure 12(b)(6), a complaint may be dismissed against a defendant for failure to state a claim upon which relief may be granted against that defendant. Dismissal may be based on either the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.1990); Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 533–534 (9th Cir.1984). For purposes of evaluating a motion to dismiss, the court “must presume all factual allegations of the complaint to be true and draw all reasonable inferences in favor of the nonmoving party.” Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir.1987). Any existing ambiguities must be resolved in favor of the pleading. Walling v. Beverly Enters., 476 F.2d 393, 396 (9th Cir.1973).

However, mere conclusions couched in factual allegations are not sufficient to state a cause of action. Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986); see also McGlinchy v. Shell Chem. Co., 845 F.2d 802, 810 (9th Cir.1988). The complaint must plead “enough facts to state a claim for relief that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Courts may dismiss a case without leave to amend if the plaintiff is unable to cure the defect by amendment. Lopez v. Smith, 203 F.3d 1122, 1129 (9th Cir.2000).

IV. DISCUSSION

Defendant moves to dismiss on the grounds that: (1) Plaintiffs fail to allege injury-in-fact that would give them standing to maintain an action in federal court; (2) Plaintiffs fail to state a claim under the Wiretap Act, because they do not allege disclosure of the “contents of a communication”; (3) Plaintiffs fail to state a claim under the Stored Communications Act, because they do not allege disclosure of the “contents of a communication” and because the same conduct cannot be a violation of both the Wiretap Act and the Stored Communications Act; (4) Plaintiffs fail to state a claim under the UCL because they lack standing, since they have not alleged that they have lost money or property; (5) Plaintiffs fail to state a claim under Cal.Penal Code § 502 because Defendant's activities do not amount to the type of “hacking” or “breaking into a computer” that the law was intended to prohibit; (6) Plaintiffs fail to state a claim under the CLRA, because such claims can only be brought by consumers; (7) Plaintiffs fail to state a claim for Breach of Contract, because they do not allege that they suffered appreciable or actual damage; (8) Plaintiffs fail to state a claim under Cal. Civ.Code §§...