Jones v. Google LLC

• Decision Date: 28 December 2022
• Docket Number: 21-16281
• Citation: 56 F.4th 735
• Parties: Cara JONES, as parent and guardian of E.J., N.J., A.J., and L.J., minors; Justin Efros, as parent and guardian of J.A.E. and J.R.E., Minors; Nichole Hubbard, as parent and guardian of C.H., a minor; individually and on behalf of all others similarly situated; Renee Gilmore, as parent and guardian of M.W., a minor; Jay Goodwin, as parent and guardian of A.G., a minor; Bobbi Dishman, as parent and guardian of C.D., a minor; Paula Ridenti, as parent and guardian of R.A. and R.M.A., minors; C.H.; E.J.; N.J.; A.J.; L.J.; J.A.E.; J.R.E.; M.W.; A.G.; C.D., Plaintiffs-Appellants, v. GOOGLE LLC; YouTube, LLC ; Mattel, Inc. ; Dreamworks Animation LLC; Hasbro, Inc.; Hasbro Studios, LLC; The Cartoon Network, Inc. ; Cartoon Network Studios, Inc. ; Pocketwatch, Inc.; Remka, Inc.; RTR Production, LLC ; RFR Entertainment, Inc., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

56 F.4th 735

Cara JONES, as parent and guardian of E.J., N.J., A.J., and L.J., minors; Justin Efros, as parent and guardian of J.A.E. and J.R.E., Minors; Nichole Hubbard, as parent and guardian of C.H., a minor; individually and on behalf of all others similarly situated; Renee Gilmore, as parent and guardian of M.W., a minor; Jay Goodwin, as parent and guardian of A.G., a minor; Bobbi Dishman, as parent and guardian of C.D., a minor; Paula Ridenti, as parent and guardian of R.A. and R.M.A., minors; C.H.; E.J.; N.J.; A.J.; L.J.; J.A.E.; J.R.E.; M.W.; A.G.; C.D., Plaintiffs-Appellants,

v.GOOGLE LLC; YouTube, LLC ; Mattel, Inc. ; Dreamworks Animation LLC; Hasbro, Inc.; Hasbro Studios, LLC; The Cartoon Network, Inc. ; Cartoon Network Studios, Inc. ; Pocketwatch, Inc.; Remka, Inc.; RTR Production, LLC ; RFR Entertainment, Inc., Defendants-Appellees.

No. 21-16281

United States Court of Appeals, Ninth Circuit.

Argued and Submitted August 31, 2022 Seattle, Washington

Filed December 28, 2022

David S. Golub (argued), Steven L. Bloch, and Ian W. Sloss, Silver Golub & Teitell LLP, Stamford, Connecticut; Jonathan K. Levine, Elizabeth C. Pritzker, and Caroline C. Corbitt, Pritzker Levine LLP, Emeryville, California; Edward F. Haber, Shapiro Haber & Urmy LLP, Boston, Massachusetts; for Plaintiffs Appellants.

Edith Ramirez (argued), Adam A. Cooke (argued), Michelle A. Kisloff, and Jo-Ann Tamila Sagar, Hogan Lovells US LLP, Washington, D.C.; Christopher Cox, Hogan Lovells US LLP, Menlo Park, California; Helen Yiea Trac, Hogan Lovells LLP, San Francisco, California; Christopher Chorba and Jeremy S. Smith, Gibson Dunn & Crutcher LLP, Los Angeles, California; Anna Hsia, Zwillgen Law LLP, San Francisco, California; Jefferey Landis and Adya Baker, Zwillgen Law PLLC, Washington, D.C.; Jonathan H. Blavin, Munger Tolles & Olson LLP, San Francisco, California; Jordan D. Segall and Ariel T. Teshuva, Munger Tolles & Olson LLP, Los Angeles, California; Michael J. Saltz and Elana R. Levine, Jacobson Russell Saltz Nassim & De La Torre LLP, Los Angeles, California; Jeremy S. Goldman, Frankfurt Kurnit Klein & Selz PC, Los Angeles, California; David E. Fink and Sarah E. Diamond, Venable LLP, Los Angeles, California; Angel A. Garganta, Venable LLP, San Francisco, California; for Defendants-Appellees.

Derek L. Shaffer, Quinn Emanuel Urquhart & Sullivan LLP, Washington, D.C.; Tyler S. Badgley, United States Chamber Litigation Center, Washington, D.C.; for Amicus Curiae Chamber of Commerce of the United States of America.

Before: Michael Daly Hawkins, M. Margaret McKeown, and Gabriel P. Sanchez, Circuit Judges.

McKEOWN, Circuit Judge:

The Children's Online Privacy Protection Act ("COPPA"), 15 U.S.C. §§ 6501 – 06, gives the Federal Trade Commission ("FTC") authority to regulate the online collection of personal identifying information about children under the age of 13. The statute includes a preemption clause that provides that "[no] State or local government may impose any liability ... inconsistent with the treatment of those activities or actions under this section." Id. § 6502(d). Hewing closely to the language of the preemption clause, we determine that Congress intended to preempt inconsistent state laws, not state laws that are consistent with COPPA's substantive requirements, such as the state law causes of action pleaded in the complaint here.

BACKGROUND

Google, best known for its popular search engine, also owns YouTube, a widely used online video-sharing platform. YouTube videos are particularly popular among children, who increasingly have smartphones and tablets that allow them to access the platform without age verification. As a testament to YouTube's popularity among kids, several popular toy and cartoon brands maintain YouTube "channels," where they post content and run advertisements designed to appeal to young audiences.

Google's targeted advertising is aided by sophisticated technology that delivers curated, customized advertising based on information about specific users. Its tracking tools can keep tabs on users' search history, video viewing history, personal contacts, browsing history, location information, and several other bits of information about users' habits and preferences, including activity on websites and platforms not owned by Google. Together, these pieces of information comprise detailed individual "profiles" of users' attributes and behaviors, extremely valuable tools for the advertisers who seek to capitalize on this deep trove of information about their targeted audiences. The revenue from these targeted ads is split between Google and the owners of the relevant YouTube channels; indeed, Google, whose search and video platforms are largely free to its users, makes most of its money through ad revenue.

Google's technology depends partly on what FTC regulations call "persistent identifiers," information "that can be used to recognize a user over time and across different Web sites or online services." 16 C.F.R. § 312.2. Examples include users' Internet Protocol addresses ("IP addresses"), numerical labels assigned to each device connected to the Internet. Google tracks users' IP addresses on all webpages using Google's advertising services. In 2013, the FTC adopted regulations under COPPA that barred the collection of children's "persistent identifiers" without parental consent. 16 C.F.R. §§ 312.2, 312.5.

In this putative class action, plaintiffs are several minor children (collectively "the Children") suing through guardians ad litem, alleging that Google used persistent identifiers to collect data and track their online behavior surreptitiously and without their consent. They seek damages and injunctive relief, asserting only state law claims: invasion of privacy, unjust enrichment, consumer protection violations, and unfair business practices, arising under the constitutional, statutory, and common law of California, Colorado, Indiana, Massachusetts, New Jersey, and Tennessee. The parties agree that all of the claims allege conduct that would violate COPPA's requirement that child-directed online services give notice and obtain "verifiable parental consent" before collecting persistent identifiers.

The complaint names two sets of defendants. First are Google LLC and YouTube, LLC, which together own and operate the YouTube platform (collectively "Google"). Second are numerous content creators that uploaded child-directed content to YouTube, including major toy brands and a television network that showcases cartoons (collectively the "Channel Owners"). Although the Children plead only state law causes of action, they also allege that Google's data collection activities violated COPPA, and that Google falsely represented that COPPA's requirements did not apply to YouTube, reasoning that it was a platform for adults, even while knowing that children use the platform.

The complaint alleges that Google did not configure YouTube to comply with COPPA until January 2020, after reaching a settlement with the FTC and the New York Attorney General in the fall of 2019. As for the Channel Owners, the complaint alleges that they lured children to their channels, knowing that the children who viewed content on YouTube would be tracked, profiled, and targeted by Google for behavioral advertising.

The district court dismissed the Second Amended Complaint, concluding that the Children's claims were expressly preempted by COPPA, 15 U.S.C. § 6502(d). The Children filed a Third Amended Complaint, adding additional details about the allegedly deceptive conduct. The court again held that the "core allegations" in that complaint were "squarely covered, and preempted, by COPPA." Regarding the deceptive conduct amendments, the court held that the Children had again "failed to allege deception beyond what is regulated by COPPA." The court granted the Children leave to file another amended complaint "if they can substitute proper plaintiffs to represent persons in the 13-16 age range"—i.e. , older than COPPA's cutoff at 13 years old. The Children informed the district court that they did not intend to further amend and filed this appeal instead.

ANALYSIS

Under COPPA and its regulations, companies that operate websites and online services marketed toward children must provide certain disclosures about their data collection activities and must safeguard the confidentiality, security, and integrity of the children's personal online information. 15 U.S.C. § 6501 – 06 ; 16 C.F.R. §§ 312.1 – 13. COPPA does not authorize a private right of action. Rather, the statute confers enforcement authority on the FTC, 15 U.S.C. § 6505(a), and on state attorneys general, who must notify the FTC and cooperate with it to bring civil actions as parens patriae, id. § 6504(a). Several other specified agencies retain enforcement authority over the entities that they oversee. Id. § 6505(b).

This appeal presents the question whether COPPA preempts state law claims based on underlying conduct that also violates COPPA's regulations. Preemption derives from the Supremacy Clause, which "invalidates state laws that interfere with, or are contrary to federal law." Hillsborough Cnty. v. Automated Med. Labs., Inc. , 471 U.S. 707, 712–13, 105 S.Ct. 2371, 85 L.Ed.2d 714 (1985) (quotation and citation omitted). The Supreme Court has identified "three different types of preemption"—express, conflict, and field. Murphy v. NCAA , ––– U.S. ––––, 138 S. Ct. 1461, 1480, 200 L.Ed.2d 854 (2018). The district court based its dismissal on express preemption; Google and the Channel Owners argue in the alternative that the claims are conflict-preempted. Field preemption was not argued by any party and so we do not reach that question here. We review de novo the district court's dismissal of the complaint on preemption grounds. Metrophones Telecomms., Inc. v. Glob. Crossing Telecomms., Inc. , 423 F.3d 1056, 1063 (9th Cir. 2005), aff'd , 550 U.S. 45, 127 S.Ct. 1513, 167 L.Ed.2d 422 (2007).

I....