Late last year, our colleagues highlighted a wave of class action litigation asserting novel claims under state wiretap laws against website operators that use session replay software and chatbots on consumer websites. Federal district courts in California have now ruled on the first round of chatbot cases, most brought by a handful of “tester” plaintiffs under the California Invasion of Privacy Act (“CIPA”), Cal. Penal Code §§ 630 et seq., and have nearly uniformly rejected the claims. These initial favorable rulings should be helpful for defendants facing similar claims.
Eleventh Circuit Analyzes Article III Standing in Class Action Settlement Context
The Eleventh Circuit recently addressed two aspects of Article III standing relevant to class action settlements: the standing of a class member to object, and the standing of class representatives to seek injunctive relief—and thus whether such injunctive relief should be given any weight as part of the approval process.
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Ninth Circuit Holds COPPA Does Not Preempt Consistent State Law Claims Premised on COPPA Violations
The Ninth Circuit recently held that the Children’s Online Privacy Protection Act, which gives the Federal Trade Commission authority to regulate the online collection of personal information from children under the age of 13, does not preempt consistent state law, potentially increasing the risk of class action litigation based on alleged COPPA violations. See Jones
A Closer Look: Equitable Jurisdiction in the Ninth Circuit After Sonner
Under the Ninth Circuit’s 2020 decision in Sonner v. Premier Nutrition Corp., 971 F.3d 834 (9th Cir. 2020), plaintiffs cannot recover equitable relief in federal court if they have an adequate legal remedy. More than two years later, district courts remain divided on how to apply Sonner at the pleading stage, with some postponing the analysis to later stages and others routinely dismissing equitable claims. In courts that take the stricter view, Sonner can be a useful tool for narrowing the claims class action defendants must litigate in a federal case, particularly in California, where common consumer protection claims are largely limited to equitable remedies. That said, a pair of recent Ninth Circuit decisions highlights that defendants should carefully consider the risk that a plaintiff will refile dismissed equitable claims in state court.
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Eleventh Circuit, Sitting En Banc, Reverses Panel Decision And Holds FDCPA Plaintiff Lacks Standing
The Eleventh Circuit, sitting en banc, recently applied TransUnion to hold that a plaintiff lacked Article III standing to bring claims under the Fair Debt Collection Practices Act. Hunstein v. Preferred Collection & Mgmt. Servs., Inc., No. 19-14434, 2022 WL 4102824 (11th Cir. Sept. 8, 2022)(en banc). The en banc decision reversed a controversial panel decision allowing a plaintiff to sue a collection agency for disclosing information about his debt to the agency’s mail vendor.
Third Circuit Refuses to Accept Inferences to Support Findings of Numerosity and Commonality
The Third Circuit’s recent decision in Allen v. Ollie’s Bargain Outlet, Inc., — F.4th —-, 2022 WL 2284654 (3d Cir. 2022), gave close scrutiny to two elements of the class certification inquiry – numerosity and commonality – that are often deemed satisfied with little analysis, and rejected the district court’s reliance on inferences drawn from limited evidence.
A Closer Look: Arbitration Clauses Added to Account Agreements Face Risks After Supreme Court Declines Review of Sixth Circuit’s BB&T Decision
The Supreme Court recently declined to review the Sixth Circuit’s decision in Sevier County Schools Federal Credit Union v. Branch Banking & Trust Co., 990 F.3d 470 (6th Cir. 2021), which presents a potential challenge to enforcing arbitration clauses added to standard account agreements. The cert denial serves as a reminder that companies introducing arbitration agreements should take care to follow all contractual change-of-term requirements and create a record of affirmative customer assent whenever possible.
Fourth Circuit Holds Statements About Importance of Data Security Not Actionable
The Fourth Circuit’s opinion last week in In re Marriott International, Inc., — F.4th —-, No. 21-1802 (4th Cir. Apr. 21, 2022), could prove useful to companies facing data breach class actions. Following a data breach of the Starwood guest reservation system, Marriott investors brought securities claims alleging that the purported failure to disclose vulnerabilities in Starwood’s IT systems rendered certain public statements false or misleading.
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Ninth Circuit Narrowly Interprets Scope of FCRA Disclosure Obligation
The Ninth Circuit recently rejected an interpretation of the Fair Credit Reporting Act’s disclosure obligation that would have significantly expanded what information credit reporting agencies (CRAs) must disclose upon consumer request.
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Illinois Supreme Court Rules Workers’ Compensation Act Does Not Bar BIPA Liquidated Damages Claims
On Thursday, the Illinois Supreme Court unanimously ruled in McDonald v. Symphony Bronzeville Park LLC that the exclusivity provisions of the state’s workers’ compensation statute do not preclude liquidated damages claims under the Biometric Information Privacy Act. The decision narrows the defenses available to employers facing employment-related BIPA claims.