A U.S. district court recently granted in part and denied in part the New York Times’s motion to dismiss claims that its subscription renewal terms violated North Carolina’s little-used Automatic Renewal Statute. The plaintiff, on behalf of a putative class, claimed that the Times subscription process failed to adequately disclose the automatic renewal and cancellation options as required by the statute. The court dismissed several of the plaintiff’s claims, but the case was allowed to proceed on allegations that the methodology for canceling was not clearly and conspicuously disclosed, and that the terms of subscription price increases were not provided in the format required by the statute.
The U.S. Supreme Court Punts on Section 230 in Gonzalez v. Google LLC
The Supreme Court recently issued its opinion in Gonzalez v. Google LLC, a case about whether Section 230 of the Communications Decency Act (47 U.S.C. § 230) protected YouTube’s recommendation algorithms from a claim of secondary liability under the Anti-Terrorism Act (ATA). In a short, three-page per curiam opinion, the Court avoided addressing the
Court Denies Remand of Privacy Suit, Finding Article III Standing Under TransUnion
A federal district court recently denied remand of a proposed class action against Twitter, Inc., rejecting plaintiff’s arguments, including that the removal was improper because his claim was limited to a “statutory damages remedy” that does not confer Article III standing under TransUnion LLC v. Ramirez. See Order Denying Plaintiff’s Motion to Remand, Morgan v. Twitter, Inc., No. 2:22-cv-00122-MKD (E.D. Wash. May 5, 2023).
Continue Reading Court Denies Remand of Privacy Suit, Finding Article III Standing Under TransUnion
New York and Minnesota Video Privacy Statutes Do Not Include Private Rights of Action for Retention of Rental History Data, Federal Court Holds
A court in the Northern District of California recently dismissed with prejudice a case that claimed a company violated the New York Video Consumer Privacy Act (“NYVCPA”) and the Minnesota Video Privacy Law (“MVPL”) by retaining consumers’ personally identifiable video rental history data. The court found that neither the NYVCPA nor the MVPL contained private rights of action for retention of that data.
A Closer Look: Courts Reject California Wiretap Claims Based on Website Chat Features
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.
Federal Court Finds That Plaintiffs Aren’t “Subscribers” Under The Video Privacy Protection Act
On April 24, 2023, a judge in the Southern District of New York dismissed a putative class action alleging that Scripps Network LLP (“HGTV”) disclosed plaintiffs’ identities and streaming activities on hgtv.com in violation of the Video Privacy Protection Act (“VPPA”). See Carter v. Scripps Networks, LLC, No. 22-CV-2031 (PKC), 2023 WL 3061858, at *1 (S.D.N.Y. Apr. 24, 2023).
AI Face-Swap App Spawns New Class Action
Last month, a new class action lawsuit was filed in California federal district court against the maker of the app “Reface,” which allegedly allows users to swap their face onto that of a celebrity in images and videos. The plaintiff in the case, Kyland Young, was a finalist on the reality TV show Big Brother. He alleges that Reface allows users to “become” him and to recreate his scenes from the show with their face in place of his. Young alleges that in doing so, the defendant is commercially exploiting his likeness without his permission in violation of California’s right of publicity statute. Young asserts the claim on behalf of a putative class of “[a]ll California residents whose name, voice, signature, photograph, or likeness was displayed on [the] Reface application . . .” Young does not allege how many likenesses were available for use on Reface, but he does allege they are enough to satisfy Rule 23’s numerosity requirement. See Young v. NeoCortext, Inc., Case No. 2:23-cv-02496 (C.D. Cal.).
A Closer Look: Federal Court Concludes that Certain NFTs May Be Securities: Preliminary Determination in Ongoing NBA Top Shot Litigation
On February 22, 2023, a federal judge in the Southern District of New York issued a first-of-its-kind order allowing a securities class action lawsuit to proceed against the issuer of non-fungible tokens (“NFTs”) on the grounds that the NFTs are securities for purposes of federal securities laws. Friel v. Dapper Labs, Inc. et. al., Case No. 1:21-cv-05837-VM (S.D.N.Y). NFTs are digital tokens, frequently associated with digital content, for which ownership of the tokens is recorded on a blockchain. The order was issued in the context of a lawsuit against Dapper Labs, the creator and issuer of NBA Top Shot “Moments.” Moments are digital video clips of NBA game highlights and their associated NFTs minted by Dapper Labs. Moments are offered and sold on Dapper Labs’ proprietary digital platform, validated on Dapper Labs’ private blockchain (the “Flow Blockchain”) and trade on a secondary marketplace controlled by Dapper Labs. The lawsuit claims that Moments are securities and Dapper Labs offered and sold those securities in violation of the registration requirements of the federal securities laws. Dapper Labs filed a motion to dismiss the lawsuit, and the court rejected the motion, concluding that Moments are securities.
New BIPA Claims Accrue “With Every Scan or Transmission” of Biometric Information, Says the Illinois Supreme Court
The Illinois Supreme Court has ruled that separate claims under the state’s Biometric Information Privacy Act (BIPA) accrue “with every scan or transmission” of a person’s biometric information—rejecting the idea that only a single claim accrues at the start of a series of similar scans or disclosures.
The decision, Cothron v. White Castle, substantially increases potential damages exposure for BIPA defendants. The potential for large monetary awards is likely to spur more BIPA lawsuits in Illinois—and potentially beyond, as several other States have similar privacy laws taking effect in 2023. At the same time, however, Cothron establishes that trial courts have discretion to determine the appropriate amount of statutory damages (subject to a $5,000-per-violation cap), and suggests that it would be an abuse of discretion for a trial court to permit such a sizeable award that a company’s financial viability would be threatened.
Dior’s Virtual Try-On Tool Fits in BIPA Healthcare Exemption, Illinois Court Says
Dior recently defeated an Illinois Biometric Information Privacy Act (“BIPA”) putative class action on the pleadings by arguing that BIPA’s exemption for patient data captured in a health care setting covered the plaintiff’s use of Dior’s virtual try-on tool while shopping for non-prescription sunglasses. See Warmack-Stillwell v. Christian Dior, Inc., No. 1:22-CV-04633 (N.D. Ill. Feb. 10, 2023).
Continue Reading Dior’s Virtual Try-On Tool Fits in BIPA Healthcare Exemption, Illinois Court Says