Facebook Can Log Off From Offline-User Tracking Class Suit

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By Jimmy H. Koo

Facebook Inc. won’t have to face claims by a massive potential class that it tracked offline users’ internet activities, after a California federal court dismissed the suit for a third and final time.

Plaintiffs failed to convince the U.S. District Court for the Northern District of California that the Menlo Park, Calif.-based social media giant was contractually bound to not track the internet activities of logged-out Facebook users ( In re Facebook Internet Tracking Litig. , 2017 BL 414264, N.D. Cal., No. 5:12-md-02314-EJD, 11/17/17 ).

The multidistrict litigation consolidated in California had gone through two previous rounds of dismissal motions from Facebook, where the district court dismissed the majority of the plaintiffs’ Wiretap Act, Stored Communications Act, Electronic Communications Privacy Act, and state statutory claims. But the court allowed the plaintiffs to amend their complaint. The court this time dismissed the litigation with prejudice, meaning the plaintiffs are precluded from amending and refiling their complaint.

The named plaintiffs were seeking to represent a class of every active U.S. Facebook users from April 2010 through a later date determined after discovery. The first amended complaint said the potential class could number 150 million Facebook users. The number of daily active Facebook users in U.S. and Canada in the spring of 2010 was approximately 82 million, according to Bloomberg data.

No Contractual Duty

The third amended complaint argued that the plaintiffs had entered into a contract with Facebook through its statement of rights and responsibilities (SRR), privacy policy, and relevant pages on its help center that obligated the company to not track their activities when they were not logged in to Facebook. The plaintiffs argued that the language in the privacy policy prohibiting offline tracking was incorporated by reference into the SRR.

The court, however, agreed with Facebook that the privacy policy language couldn’t have been incorporated by reference into the SRR that the plaintiffs attached to their complaint because it didn’t exist at the time the SRR was published. The policy language was published Sept. 7, 2011, while the SRR at issue was published April 26, 2011.

District Judge Edward J. Davila said that earlier versions of the privacy policy didn’t contain the prohibition on offline tracking and, therefore, Facebook didn’t have a contractual obligation to not track offline users over the time period covered by the complaint.

Facebook’s Associate General Counsel Natalie Naugle told Bloomberg Law in a Nov. 20 email that the company is pleased with the court’s ruling.

Bartimus Frickleton Robertson PC and Kiesel Law LLP represented the plaintiffs. Cooley LLP represented Facebook.

To contact the reporter on this story: Jimmy H. Koo in Washington at jkoo@bloomberglaw.com

To contact the editor responsible for this story: Donald Aplin at daplin@bloomberglaw.com

For More Information

Full text of the court's order is available at http://src.bna.com/umu.

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