On November 22, 2011, the Northern District Court ruled in the In re Facebook Litigation, dismissing the Plaintiffs’ claims with prejudice. The case has been blogged about extensively, and arises from the alleged transfer of information from Facebook to certain third-parties. There were a number of issues that were addressed, including who the intended recipient of the communications were, whether Facebook was acting as a “Remote Computing Service”, or RCS, and whether a breach of contract claim could be stated.
In addressing the Stored Communications Act claim, the District Court found that the Plaintiffs could not state a claim.
Upon review, the Court finds that Plaintiffs fail to state a claim under the SCA. In its May 12 Order, the Court observed that Plaintiffs were either alleging “that the communications at issue were sent to Defendant or to advertisers.” (May 12 Order at 10.) The Court explained that, under either interpretation, Plaintiffs had failed to state a claim under the SCA. (Id.) As the Court explained, if the communications were sent to Defendant, then Defendant was their “addressee or intended recipient,” and thus was permitted to divulge the communications to advertisers so long as it had its own “lawful consent” to do so. (Id.(citing 18 U.S.C. § 2702(b)(3)).) In the alternative, if the communications were sent to advertisers, then the advertisers were the addressees or intended recipients of those communications, and Defendant was permitted to divulge the communications to them. (Id.(citing 18 U.S.C. § 2702(b)(1)).)
In other words, the District Court correctly noted that here the communications at issue were sent by Facebook to the defendants and their advertisers, and these communications were intended to go to these parties. Thus, there was no SCA violation, because the intended recipients received the communications and it was not, in the classic sense, a stranger to the communication receiving something.
The Plaintiffs attempted to argue that since Facebook was acting as an RCS the “intended recipient” exception did not apply. The District Court considered the definitions of an ECS v. an RCS, and noted:
In order to address Plaintiffs’ claims, the Court finds that it is necessary to consider the difference between an ECS provider and an RCS provider under the SCA. The SCA defines an ECS as “any service which provides to users thereof the ability to send or receive wire or electronic communications.” 18 U.S.C. § 2510(15). By contrast, the SCA defines an RCS as “the provision to the public of computer storage or processing services by means of an electronic communications system.”Id.§ 2711(2). As the Ninth Circuit has explained, when the SCA was passed in 1986, Congress intended the term “RCS” to refer to an “off-site third party” which performed the tasks of “processing or storage of data” for subscribers to the RCS. Quon, 529 F.3d at 901-02 (citations omitted). In speaking of “processing” data, Congress referred to a business practice of “transmit[ting] their records to remote computers to obtain sophisticated data processing services” of the type that is currently performed by “advanced computer processing programs such as Microsoft Excel.”Id.at 902. In speaking of the “storage of data,” Congress referred to a business practice of maintaining files in “offsite data banks,” which acted as a “virtual filing cabinet.”Id.
Upon review, the Court finds that Plaintiffs’ argument relies on two mutually inconsistent propositions. On the one hand, Plaintiffs allege that the communications at issue in this case were requests to be connected to specific advertisements; that the requests were addressed to advertisers; and that Defendant merely acted as the “intermediary” for those communications. (FAC ¶¶ 69, 74, 81.) On the other hand, Plaintiffs contend that Defendant acted as an RCS provider for purposes of Plaintiffs’ claim under the SCA. (Opp’n at 2.) On the first view, if the communications were addressed to advertisers, then they were not sent to Defendant in order for Defendant to provide the “processing or storage” of Plaintiffs’ “data,” which means that Defendant was not acting as an RCS provider with respect to the communications. Quon, 529 F.3d at 901-02. By contrast, on the second view, if Defendant was acting as an RCS provider for purposes of Plaintiffs’ claim, then it must be the case that Plaintiffs’ communications consisted of “data” which Plaintiffs sent to Defendant for “processing or storage.” However, Plaintiffs allege that the communications at issue were requests to be connected to advertisements, not data to be processed or stored.
Thus, the District Court dismissed the claim, finding in essence the Plaintiffs could not have their cake, and eat it too.
The District Court also dismissed the California computer crime claims under Penal Code 502, holding that the plaintiffs had failed to allege that a computer “contaminant” had impacted their computer. Here, because the nature of the conduct related to instructions sent to the user’s computer—specifically the browser via a standard function, the conduct did not meet the definition of a computer contaminant.
Finally, the District Court addressed whether Plaintiffs could state a claim for breach of contract based upon the theory that they had damages resulting from the “value” of their personal information. The District Court found that the Plaintiffs had failed to show “actual and appreciable damages” and therefore dismissed the claim. This calls into question Plaintiffs’ attempts to advance this rather novel theory.
In a companion opinion, the District Court dismissed claims against Zynga as well for similar reasons. Links to both the Facebook, and Zynga decisions can be found here.