Last month, a defendant won dismissal of a putative VPPA class action when the court concluded that the defendant’s use of online videos was not central to the defendant’s business, and the VPPA therefore did not apply. Another court has now reached the same result. See Cantu v. Tapestry, Inc., 3:22-cv-01974 (S.D. Cal. July 10, 2023). This trend highlights the limits of the VPPA’s reach and provides forceful grounds for future motions to dismiss and demand letter responses.
In Cantu, plaintiff’s complaint contained by now familiar allegations: plaintiff’s video-viewing activity had been shared with a third party, in purported violation of the VPPA, via pixel code allegedly installed on defendant’s website.
Cantu turned on the VPPA’s “video tape service provider” element. The VPPA applies only to “video tape service provider[s],” defined as “any person engaged in the business . . . of rental sale, or delivery of prerecorded video cassette tapes or similar audio visual materials.” Plaintiff claimed that defendant was “in the business” of video delivery because defendant’s “business model monetizes the occasions its customers watch videos.” But this was insufficient, the court held. The court concluded that nothing supported the inference that defendant’s “enterprise is ‘significantly tailored’ to achieving” video-viewing monetization. To the contrary, the court found that “the ‘monetization’ of ‘instances’ plausibly suggests [defendant] ‘passively’ or ‘peripherally’ engages in the delivery of video content.” That, the court held, was “not enough to garner liability under the VPPA.” The court did allow plaintiff leave to amend to attempt to show “Defendant’s business model is ‘significantly tailored’ to the delivery of video content, rather than ‘peripherally’ or ‘passively’ involved in such an exercise.”
By concluding that the VPPA does not cover companies that use online videos in a manner only peripheral to their core business, Cantu signals growing acceptance of a strong threshold defense to future VPPA claims.