James v. The Walt Disney Co.
| Docket Number | 23-cv-02500-EMC (EMC) |
| Decision Date | 08 November 2023 |
| Parties | AMIN JAMES, et al., Plaintiffs, v. THE WALT DISNEY COMPANY, Defendants. |
| Court | U.S. District Court — Northern District of California |
Plaintiffs Amin James and David Sevesind (collectively “Plaintiffs”) have filed a class action against Defendant The Walt Disney Company (“Disney”). Plaintiffs assert that their privacy rights, as protected by Pennsylvania and California statutory law, have been violated because there is Oracle software embedded in Disney's ESPN.com website that captures and collects data as individuals use the website (e.g., pages viewed, keystrokes, mouse clicks, etc.). Currently pending before the Court is Disney's motion to dismiss for lack of standing and for failure to state a claim for relief.
Having considered the parties' briefs as well as the oral argument of counsel, the Court hereby GRANTS in part and DENIES in part Disney's motion.
In their complaint, Plaintiffs allege as follows.
Disney is a company that owns and operates the website ESPN.com. See Compl. ¶ 8. Embedded on the ESPN.com website is Oracle software, in particular, a tool known as Oracle BlueKai which is part of a line of products known as Oracle CX.[1] BlueKai intercepts and collects website visitors' electronic communications with the website. See Compl. ¶¶ 1, 14, 17. The data collected is used to market to and attract new customers for Disney. See Compl. ¶ 22.
Furthermore, “Oracle does not simply manage their clients' data[;] Oracle also retains and uses the same data to assist other clients” (i.e., clients other than Disney). Compl. ¶ 30 (emphasis added).
Compl. ¶¶ 23-24, 26, 31 (footnotes omitted).
According to Plaintiffs, Disney entered into a “contractual arrangement” with Oracle “to intercept communications between [Disney] and visitors to the [ESPN.com] website.” Compl. ¶ 33.
Mr. James is a resident of Pennsylvania and, in December 2022, visited the ESPN.com website on his computer. See Compl. ¶ 5. Mr. Davis is a resident of California and, in May 2023, visited the website on his computer. See Compl. ¶ 6. When each used the website, his communications on the website were intercepted by Oracle. See Compl. ¶¶ 37-38; see also Compl. ¶ 5 ().
Based on, inter alia, the above allegations, Plaintiffs have asserted two causes of action: (1) a violation of the Pennsylvania Wiretapping and Electronic Surveillance Control Act, 18 Pa. C.S. § 5701 et seq.; and (2) a violation of the California Invasion of Privacy Act. See Cal. Pen. Code § 631. Plaintiffs have identified three different classes: (1) a nationwide class of all persons who visited the ESPN.com website and who had electronic communications intercepted; (2) a Pennsylvania subclass; and (3) a California subclass. See Compl. ¶¶ 40-42.
Although not entirely clear, it appears that Plaintiffs are suing Disney because Oracle intercepted data for the benefit of Disney and because Oracle then used that data for the benefit of other companies as well.
As noted above, Disney seeks to dismiss both for lack of standing and failure to state a claim for relief. The motion to dismiss for lack of standing is brought pursuant to Federal Rule of Civil Procedure 12(b)(1), and for failure to state a claim for relief pursuant to Rule 12(b)(6).
A Rule 12(b)(1) motion for lack of standing can be facial in nature or factual. See Pride v. Correa, 719 F.3d 1130, 1139 (9th Cir. 2013). ” Safe Air For Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). Here, Disney makes a facial attack on standing.
To overcome a Rule 12(b)(6) motion to dismiss after the Supreme Court's decisions in Ashcroft v. Iqbal, 556 U.S. 662 (2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), a plaintiff's “factual allegations [in the complaint] ‘must . . . suggest that the claim has at least a plausible chance of success.'” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th Cir. 2014). The court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). But “allegations in a complaint . . . may not simply recite the elements of a cause of action [and] must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” Levitt, 765 F.3d at 1135 (internal quotation marks omitted). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. (internal quotation marks omitted).
Disney argues first the Court lacks subject matter jurisdiction over the case because, based on the allegations in the complaint, Plaintiffs do not have standing. Disney's argument is based on a Supreme Court decision, TransUnion LLC v. Ramirez, 141 S.Ct. 2190 (2021), and several district court cases that have interpreted TransUnion.
TransUnion involved a class action where claims for violation of the Fair Credit Reporting Act (“FCRA”) were asserted. According to the named plaintiff, TransUnion violated the FCRA based on a product it offered called OFAC Name Screen Alert.
OFAC is the U.S. Treasury Department's Office of Foreign Assets Control. OFAC maintains a list of “specially designated nationals” who threaten America's national security. Individuals on the OFAC list are terrorists, drug traffickers, or other serious criminals. It is generally unlawful to transact business with any person on the list. TransUnion created the OFAC Name Screen Alert to help businesses avoid transacting with individuals on OFAC 's list.
Id. at 2201. The product, however, “generated many false positives” because it would place an alert on a credit report indicating a potential match based on first and last names only. Id. The plaintiff alleged that TransUnion violated the FCRA when, e.g., it failed to follow reasonable procedures to ensure the accuracy of information in his credit file. See id. at 2202.
Before trial, the parties stipulated that (1) the class had 8,185 members but that (2) “only 1,853 members . . . had their credit reports disseminated by TransUnion to potential creditors” during the relevant period. Id. The district court held that all 8,185 members had Article III standing. See id. The issue before the Supreme Court was whether that decision on standing was correct.
The focus of the Supreme Court was whether the class members had suffered an injury in fact - i.e., a concrete injury that was real and not abstract. See id. at 2203. The Supreme Court asked:
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