C.M. v. BetterHelp, Inc.

Background

These putative class actions concern alleged disclosure of plaintiffs’ personal and medical information by BetterHelp, Inc. The court had previously granted and denied parts of BetterHelp’s motion to dismiss the initial consolidated complaint. Plaintiffs then filed a First Amended Consolidated Complaint, abandoning some dismissed claims, amending others, adding a Stored Communications Act claim, and providing additional grounds for injunctive and declaratory relief.

BetterHelp moved to dismiss the amended claims, the new claim, and the requests for injunctive and declaratory relief. The court decided the motion without oral argument.

Confidentiality of Medical Information Act

The court dismissed the claim under California’s Confidentiality of Medical Information Act (CMIA). The prior order had found that BetterHelp did not meet an applicable statutory definition of a health-care provider and had allowed plaintiffs to amend if they could allege facts placing BetterHelp within those definitions. The amended complaint added no such facts.

Plaintiffs instead argued that a CMIA provision applies to all corporations, regardless of whether they are health-care providers. The court rejected that interpretation. It also distinguished a California appellate decision involving a student health database because that decision did not involve the CMIA provision at issue here. The court noted that a 2023 amendment expressly added businesses offering mental-health digital services to the definition of health-care provider, but that amendment took effect after the alleged conduct and plaintiffs did not argue for retroactive application. The CMIA claim was dismissed, and the court denied further leave to amend.

Unfair-Competition and Consumer-Legal-Remedies Claims

The court denied the motion to dismiss the claims under California’s Unfair Competition Law (UCL) and Consumer Legal Remedies Act (CLRA). The earlier dismissal had found that plaintiffs did not adequately allege an economic injury. In the amended complaint, plaintiffs alleged that they paid BetterHelp monthly while relying on its assurances that their personal information would remain confidential.

The court held that plaintiffs adequately alleged reliance on those assurances and an economic loss based on not receiving the benefit of their bargain. The UCL and CLRA claims therefore remained in the case.

Breach of Implied Contract

The court declined to dismiss the breach-of-implied-contract claim. The prior order had directed plaintiffs to provide more detail about how their contractual relationships with BetterHelp were formed, what confidentiality terms applied, and how BetterHelp allegedly breached those terms. The amended complaint identified the particular confidentiality promises plaintiffs claimed BetterHelp made and breached. The court found no basis to dismiss the claim.

Stored Communications Act

The plaintiffs added a claim under the Stored Communications Act (SCA), part of the federal Electronic Communications Privacy Act. The SCA generally restricts an entity that provides an electronic communication service or remote computing service to the public from knowingly disclosing the contents of communications held in electronic storage, subject to statutory exceptions.

BetterHelp argued that the SCA applies only to businesses such as ordinary email and internet-service providers. The court rejected that narrow interpretation at the pleading stage because plaintiffs alleged that customers communicated with therapists through BetterHelp’s websites. The court also found that BetterHelp’s argument concerning whether the information was disclosed while in electronic storage raised factual issues that could not properly be resolved on a motion to dismiss. The motion to dismiss the SCA claim was denied.

Injunctive and Declaratory Relief

The court dismissed plaintiffs’ requests for injunctive and declaratory relief without leave to amend. The prior order had required plaintiffs to allege facts showing a sufficient likelihood that they would again be harmed in a similar way, a right or duty requiring BetterHelp to control third parties’ conduct, and ongoing or future harm despite an injunction obtained by the Federal Trade Commission.

The court found that the amended complaint did not satisfy those requirements. Allegations that BetterHelp had not complied with all obligations under the Federal Trade Commission’s injunction, even if accurate, did not justify a second injunction requiring similar action.

Disposition

The court granted the motion to dismiss the First Amended Consolidated Complaint to the extent specified in the order and otherwise denied it. The CMIA claim and requests for injunctive and declaratory relief were dismissed; the UCL, CLRA, breach-of-implied-contract, and SCA claims were not dismissed. BetterHelp was ordered to file an answer within 20 days of the order.