On December 29, 2018, Google won summary judgment in Rivera v. Google, a privacy class action alleging violations of the Illinois Biometric Information Privacy Act (BIPA). The case involved “face grouping,” a feature that enables Google Photos to automatically sort and group the photographs in a user’s private account based on visual similarities between the images of faces in the photos. The court held that any alleged collection of “biometric information” or “biometric identifiers” stemming from this feature did not cause an injury-in-fact sufficient to confer Article III standing. The Rivera v. Google decision demonstrates that, even in the context of claims arising out of privacy statutes, like Illinois’ BIPA, a defendant can prevail on a challenge to subject matter jurisdiction if it can demonstrate that the alleged violation did not result in any concrete injury to the plaintiffs. Some states impose similar requirements to bringing suit in state court. As states continue to enact privacy legislation, corporations that collect private information can mitigate risk by considering and enhancing their available Article III defenses, including by documenting how they protect potential plaintiffs’ information from disclosure.
The Ninth Circuit recently denied a motion for rehearing en banc in Marks v. Crunch, leaving in place a Ninth Circuit decision that broadly defines “automated telephone dialing system” (“autodialer”) under the Telephone Consumer Protection Act (“TCPA”). The decision conflicts with decisions from other circuits. And in the New Year, the FCC is expected to issue its own new interpretation of the term “autodialer” under the TCPA. Amidst this uncertainty, companies should proceed cautiously when reaching consumers by phone or text, and should consider how to minimize risk with respect to the TCPA’s autodialer provisions. Continue Reading Ninth Circuit Interprets Automatic Telephone Dialing System under TCPA, Leaving Circuit Split
It’s been a busy year in consumer protection law and during this holiday season, we’re taking stock of the past year and looking ahead to what’s next. In 2018, we saw many class actions related to pricing practices, scrutiny of Made in USA claims, continued growth in popularity and the evolution of influencers (CGI influencers!), changes to automatic renewal laws, and a new slate of FTC Commissioners.
In 2019, we expect significant activity in these areas, plus more activity related to consumer reviews and the Consumer Review Fairness Act. Further, representatives from the FTC are signaling that the FTC may start seeking more monetary remedies for consumer protection violations moving forward (versus only injunctive relief and ongoing monitoring). Finally, the growth of the blockchain and digital currencies has raised a number of complex legal issues that companies using the blockchain must navigate, and 2019 will likely bring additional guidance (and challenges) in this area.
For more thoughts on what comes next, see our Hot Ad Law Topics for the New Year.
As consumers shift towards “organic,” “natural,” and “clean” foods for themselves and their families, they are also making similar purchasing decisions when it comes to pet food. However, as sales of “premium” pet food have increased in recent years, so has the number of consumer class action lawsuits filed against pet food manufacturers, specifically those involving claims that marketing and labeling pet foods as “natural” is false and misleading when they contain artificial ingredients, synthetic ingredients, chemicals, heavy metals, and/or toxins. Continue Reading Rise of “Natural” Pet Food Claims
A customer who is blind has sued Five Guys Enterprises in the Southern District of California, claiming that he could not access the Freestyle Coca-Cola soda machine in a Five Guys restaurant. The parties each filed a motion for summary judgment on the issue of whether Five Guys violated the Americans with Disability Act (ADA), California’s Unruh Act and California’s Disabled Person Act (DPA) when its employees did not offer to help the customer use the soda machine.
Generally, the ADA, and California’s Unruh Act and the DPA require that public accommodations (like a restaurant) ensure that no individual is discriminated against on the basis of a disability. Public accommodations are required to furnish appropriate auxiliary aids and services to ensure effective communication with individuals with disabilities. Here, the plaintiff claimed that this meant Five Guys employees should have offered to help him operate the soda machine. Continue Reading Court Rules Restaurant Should Have Affirmatively Offered Assistance to a Customer Who Is Visually-Impaired
A California appeals court has allowed a putative-class-action complaint to proceed against an online retailer based on a consumer’s allegation that the retailer falsely advertised price discounts and that the consumer would not have purchased the items if he knew he was not receiving a discount.
In Hansen v. Newegg.com Americas Inc., Case No. B271477, the Fifth Appellate District of the California Court of Appeals reversed the lower court. The lower court had dismissed for lack of standing, reasoning that plaintiff received exactly what he paid for. The Court of Appeals held, however, that the plaintiff had established standing because he claimed the “list prices” (which were crossed out and next to a lower, actual price) were inflated and that he would not have purchased his items if he had known the list prices were misrepresented. This was enough to establish injury to “money or property,” as required by California law. The opinion discussed both California Supreme Court and Ninth Circuit precedent interpreting California’s Unfair Competition Law and False Advertising Law.
Takeaway: Companies will want to carefully monitor compliance with pricing laws as pricing and discount class actions will continue to be filed in California.
- An increasing number of individuals who are deaf or hard of hearing are challenging the absence of closed captioning as a violation of the Americans with Disability Act (ADA).
- Companies placing video on their websites should consider whether they need to include closed captioning under the ADA.
Website accessibility under the ADA continues to be a trending legal area, with multiple complaints filed against companies each week. Although most complaints allege that a website violates the ADA for failing to be accessible for users who are blind or visually impaired, an increasing number of complaints allege that online video without closed captioning violates the ADA. These plaintiffs assert that the failure to provide closed captioning makes the videos inaccessible to individuals who are deaf or hard of hearing. In March and April 2018, more than 25 complaints were filed in federal courts across the country alleging that a failure to provide closed-captioning violates the ADA.
Title III of the ADA generally requires that places of public accommodation provide equal access to the goods and services they offer. The DOJ has not issued rules regarding website accessibility, but various courts have held that the ADA requires certain websites to be accessible to people who are blind and visually-impaired. Some courts have held there must be a nexus between the website and a physical place of public accommodation, but other courts do not require such nexus. Because plaintiff’s lawyers continue to focus on this area, companies will want to pay attention to the accessibility of their websites, including closed captioning.
Because pricing discount and sales class actions are likely to continue and retailers, especially brick-and-mortar ones, may have difficulty enforcing arbitration agreements and class action waivers, companies will want to not only check the ways in which they draft and enforce arbitration agreements, but carefully monitor compliance with pricing laws.
The Tenth Circuit recently affirmed a district court’s denial of J.C. Penney’s bid to compel arbitration in a putative class action challenging J.C. Penney’s pricing discounts and sales in Cavlovic v. J.C. Penney Corp., Inc., No. 2:17-CV-02042-JAR-TJJ (10th Cir. March 7, 2018). The case involved an in-store transaction. The Court of Appeals rejected J.C. Penney’s attempt to enforce (1) an arbitration clause contained in a credit card agreement; and (2) an arbitration clause contained in the agreement governing J.C. Penney’s rewards program.
Plaintiff purchased a pair of earrings at a J.C. Penney retail location with an advertised price of $209.99. The earrings were marked with a previous price of $524.98, and Plaintiff also received 25% off due to an additional sale. After purchasing the earrings and retuning home, Plaintiff claimed that she noticed an original price tag of 225, which was blacked out. Alleging the former price of $524.98 was fraudulently inflated and that she should have been given a discount off the $225 price, she sued J.C. Penney. She alleged false advertising under the Kansas Consumer Protection Act and asserted that she suffered emotional distress.
In response, J.C. Penney tried to enforce two different arbitration clauses–one from a J.C. Penney’s branded credit card (used to purchase the earrings) and the other from a rewards program (of which Plaintiff was a member). J.C. Penney lost on both arguments. The Tenth Circuit held that J.C. Penney was not a party to the credit card agreement formed between the issuing bank and the Plaintiff, and could not enforce the contract as a third party under Utah law, which governed the agreement. As for the rewards program, while J.C. Penney was a party to that agreement, the Court determined Plaintiff’s complaint was outside the scope of the arbitration clause, which governed disputes only “arising from or relating to” the rewards program itself.
Cy pres remedies … are a growing feature of class action settlements. … In a suitable case, this Court may need to clarify the limits of the use of such remedies.” Marek v. Lane, 134 S. Ct. 8, 9 (2013) (Roberts, C.J., respecting denial of certiorari).
In Marek, the U.S. Supreme Court denied cert in a case questioning the propriety of a cy pres award in a class action settlement. But Chief Justice Roberts suggested he might nevertheless be on the lookout for “an opportunity to address the more fundamental concerns surrounding the use of such [cy pres] remedies in class action litigation, including when, if ever, such relief should be considered; how to assess its fairness as a general matter; … what the respective roles of the judge and parties are in shaping a cy pres remedy; how closely the goals of any enlisted organization must correspond to the interests of the class; and so on.” Id. Continue Reading Is SCOTUS Going to Tackle Cy Pres Awards in Class Action Settlements?