Regan v. Pinger, Inc.
| Decision Date | 23 February 2021 |
| Docket Number | Case No. 20-CV-02221-LHK |
| Parties | LUCAS REGAN, Plaintiff, v. PINGER, INC., Defendant. |
| Court | U.S. District Court — Northern District of California |
Before the Court is Defendant Pinger, Inc.'s ("Defendant") motion to dismiss and compel arbitration. ECF No. 20 ("Mot."). Having considered the parties' submissions, the relevant law, and the record in this case, the Court GRANTS Defendant's motion to dismiss and compel arbitration.
Plaintiff Lucas Regan ("Plaintiff") is a resident of Illinois. Complaint at ¶ 9, ECF No. 1 ("Compl."). Defendant Pinger is a Delaware corporation with its principle place of business in California. Id. at ¶ 10. Defendant develops applications ("apps") for mobile phones. Relevant to the instant case is an app Defendant developed called "Sideline." Id. at ¶ 20. Sideline is a paid service that allows users to create a "virtual," alternative telephone line for their mobile phone. Id.
To create a Sideline account a user must first download the Sideline Application ("Sideline App"). Declaration of Jocelyn Cloutier, ECF 20-1, at ¶ 25 ("Cloutier Decl."). The user is then presented with a screen instructing the user how to proceed with creating an account. The design of that screen has changed over time. Id. Plaintiff's complaint does not allege when Plaintiff created his first account, but Defendant's declarant attests that Plaintiff created 186 different Sideline accounts between April 23, 2016 and March 16, 2019. Id. at ¶ 9.
Between October 2, 2017 and March 16, 2019, the Sideline App used two different iterations of the account creation screen. In one iteration, used during the period when Plaintiff created 41 Sideline accounts, the user was presented with a screen that included a space to type in a phone number and password, and at the bottom of the screen the user could click a button labeled "CREATE ACCOUNT." Directly above the "CREATE ACCOUNT" button was a line that read "By registering, I agree to Sideline's Terms and Conditions." "Terms and Conditions" was in neon green, and the remainder of the sentence was in gray. Id. at ¶ 29-30. If a user clicked on the "Terms and Conditions" hyperlink, the user was brought to a page that contained the full text of the Sideline Terms of Service ("TOS"). Id. at ¶ 30. A screenshot of this page in color is displayed below:
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In a second iteration, used during the period when Plaintiff created 89 accounts, the user was presented with a screen that stated "To optimize your experience, tell us how you plan to use Sideline." Id. at ¶ 32-33. Underneath that text one button read "For Professional Use" and the other button read "For Personal Use." Below these buttons a smaller gray line of text stated "By tapping 'For Professional Use', 'For Personal Use', or 'Log in' you're agreeing to our Privacy Policy and Terms of Service." "Privacy Policy" and "Terms of Service" were in neon green font. Id. "Terms of Service" was hyperlinked to a page with Sideline's full TOS. Id. at ¶ 32. A screenshot of this page in color is displayed below:
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Prior to April 23, 2016, during the period when Plaintiff created his other 56 accounts, the Sideline App used two similar screens to allow a user to create an account. Id. at ¶ 34. On these screens a user was required to input a phone number and new password into two text boxes. Underneath that information was a button labeled "Create Account." Immediately below that button a line of text stated "By registering, I agree to Sideline's Terms & Conditions." ECF No. 20-5 (Ex. D). "Terms & Conditions" was hyperlinked, and the text of the hyperlink was colored turquoise. The remainder of the text was gray. Id; Cloutier Decl. at ¶ 34. A screenshot of these pages in color is displayed below:
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Finally, at various times during the period when Plaintiff used the Sideline App, the login screen for returning users contained a line between the phone number/password box and "Login" button that read "By registering, I agree to Sideline's Terms and Conditions." "Terms and Conditions" was in neon green font, and the remainder of the line was gray text. Id. at ¶ 37. "Terms and Conditions" was hyperlinked to a page with Sideline's full TOS. Id. A screenshot of this page in color is displayed below:
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From April 23, 2016 to March 16, 2019, the period during which Plaintiff created his Sideline Accounts, Sideline's TOS always contained a provision that required the user to arbitrate "any dispute" between the user and Defendant. Id. at ¶ 12. During this period, Sideline used four different iterations of the TOS.
The first and second iterations of the TOS contained the following identical language: "If you download an App for use in the United States . . . any dispute between you and [Defendant] shall be resolved through binding arbitration . . ." Id. at ¶ 21; ECF No. 20-4, at 21, 42 (Ex. C-1 and C-2). The first and second iterations of the TOS were in use between April 23, 2016 and February 5, 2018, during which time Plaintiff created his initial 76 Sideline accounts Id. at ¶ 20, 23.
The third and fourth iterations of the TOS contained the following identical language: "Any dispute between you and [Defendant] . . . shall be resolved through binding arbitration . . ." Id. at ¶ 13; ECF No. 20-3, at 24, 48 (Ex. B-1 and B-2). The third and fourth iterations of the TOSalso included an identical opt-out provision, which stated:
You may opt out of arbitration by providing written notice to Pinger, Inc. at the address noted above, which must be received no later than thirty (30) calendar days from the date of your original acceptance of the license, the outbound terms and the inbound terms with this arbitration provision included. If you do not send notice as required in the foregoing sentence, you will not have opted out of arbitration.
Id. at ¶ 17 (). At no time did Plaintiff opt out of the Sideline arbitration provision. Id. at ¶ 24. The third and fourth iterations of the TOS were in use between February 6, 2018 and March 16, 2019, during which time Plaintiff created his remaining 110 Sideline accounts. Id. at ¶¶ 13, 19.
Plaintiff was a subscriber to the Sideline App, but allegedly cancelled his accounts in or around March 2019. Compl. at ¶ 23. According to Plaintiff's complaint, after Plaintiff cancelled his Sideline accounts Defendant began a "win-back" campaign. This involved Defendant utilizing a computer-based dialing system to send 10-15 identical text message at midnight to urge Plaintiff to sign up for Defendant's Sideline App. Id. at 25. Each text message stated "Reply STOP to opt out of these texts," to which Plaintiff responded with a "stop" request and received a confirmation. Id. at ¶¶ 26-28. Rather than cease this practice, Defendant allegedly conducted the same text-message solicitation on 5 or 6 further occasions. Id. at ¶¶ 29-30. Plaintiff alleges that these messages were sent without Plaintiff's consent and violated Plaintiff's seclusion and caused annoyance. Id. at ¶ 44. Defendant's text messages to Plaintiff also allegedly depleted Plaintiff's cellphone battery life. Id. at ¶ 46.
On January 22, 2020, Plaintiff filed a complaint against Defendant in Plaintiff's home district, the Northern District of Illinois, containing factual allegations identical to those in the instant case. See Regan v. Pinger, Inc., 1:20-CV-00486 (N.D. Ill Jan. 22, 2020), ECF No. 1. On February 19, 2020, the Seventh Circuit decided Gadelhak v. AT&T Services, which adopted an interpretation of the Telephone Consumer Protection Act ("TCPA") that excludes text messagingplatforms that do not "generate random or sequential numbers." 950 F.3d 458, 469 (7th Cir. 2020). In reaching this conclusion, the Seventh Circuit declined to follow the Ninth Circuit's more expansive interpretation of the TCPA in Marks v. Crunch San Diego, 904 F.3d 1041 (9th Cir. 2018), which included such text messaging platforms. See Gadelhak. 950 F.3d at 466. On the day that the Seventh Circuit announced its decision in Gadelhak, Plaintiff voluntarily dismissed his case. Regan, 1:20-CV-00486, ECF No. 18.
On April 1, 2020, Plaintiff filed a complaint in this district alleging that Defendant violated the TCPA by sending Plaintiff text messages without Plaintiff's prior consent. Compl. at 10. On March 21, 2020, Defendant filed the instant motion to dismiss and compel arbitration. ECF No. 20 ("Mot.").
On June 18, 2020, Plaintiff filed a motion for leave to conduct arbitration-related discovery. ECF No. 27. On July 2, 2020, Defendant filed an opposition to Plaintiff's motion to conduct arbitration-related discovery. ECF No. 28. On July 10, 2020, Plaintiff filed a reply. ECF No. 31. On July 21, 2020, United States Magistrate Judge Susan van Keulen granted in part Plaintiff's motion for leave to conduct arbitration-related discovery. ECF No. 33.
On August 4, 2020, Defendant filed a motion for relief from Judge van Keulen's order granting leave to conduct arbitration-related discovery. ECF No. 37. On August 6, 2020, the Court denied Defendant's motion for relief. ECF No. 38.
On October 5, 2020, Plaintiff filed an opposition to Defendant's motion to dismiss and compel arbitration. ECF No. 58. On October 30, 2020, Defendant filed a reply. ECF No. 62.
The Federal Arbitration Act ("FAA") applies to arbitration agreements in any contract affecting interstate commerce. See Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 119 (2001). If all claims in the case are subject to a valid arbitration agreement, the Court may dismiss or stay the case. See Hopkins & Carley, ALC v. ...
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