Addi v. The International Business Machines, Inc

Background

Lisa Addi sued International Business Machines, Inc. (IBM), individually and on behalf of proposed nationwide and Maryland classes. She alleged that IBM operates weather.com and that, when account holders watched prerecorded weather-related videos, application programming interfaces sent information such as names, email addresses, gender, geolocation, and video names and URLs to mParticle and Xandr. She alleged that IBM and those companies used the information for analytics, advertising, and revenue generation, and that she did not consent to the disclosures.

Addi asserted claims under the Video Privacy Protection Act (VPPA), the Maryland Wiretapping and Electronic Surveillance Act (MWESA), and New York unjust-enrichment law. IBM moved to dismiss under Federal Rules of Civil Procedure 12(b)(1), which concerns subject-matter jurisdiction, and 12(b)(6), which concerns whether a complaint states a legally sufficient claim.

Standing and the VPPA claim

The court held that Addi adequately alleged an injury sufficient for Article III standing on her VPPA claim. The complaint alleged that IBM disclosed, or allowed third parties to intercept, her personally identifiable information and video-viewing information without her knowledge or consent. The court treated the alleged disclosure of private information as a concrete injury and denied IBM’s request to dismiss the VPPA claim on standing grounds.

The court did not decide whether Addi was a VPPA “subscriber.” Because the Second Circuit was considering that issue in Salazar v. National Basketball Association, the court deferred ruling on the VPPA claim’s viability until that appeal is decided. The parties must file a joint letter within seven days after the Second Circuit’s decision addressing any effect on this case.

MWESA claim

The court held that Addi had not alleged the additional concrete harm needed for Article III standing on her MWESA claim. It concluded that alleging a MWESA violation alone was insufficient and that Addi had not alleged targeting, misuse, or another injury in fact. The court dismissed the MWESA claim without prejudice. It denied leave to amend that claim because it found it difficult to see how revised allegations could overcome the standing problem.

Unjust-enrichment claim

The court held that Addi’s unjust-enrichment claim was based on the same alleged disclosure of personal information underlying the VPPA and MWESA claims. Under New York law, unjust enrichment cannot simply duplicate a traditional statutory or tort claim. The court therefore dismissed the unjust-enrichment claim without prejudice.

The court granted Addi permission to file an amended complaint adding factual allegations about unjust enrichment, but stated that she would have no further opportunities to amend that claim. The deadline to file was July 1, 2024. If she failed to file on time without good cause, the claim would be deemed dismissed with prejudice.

Disposition

The court granted IBM’s motion to dismiss in part and deferred it in part. The motion was granted as to the MWESA and unjust-enrichment claims, while ruling on the VPPA claim was deferred. Addi received leave to amend only the unjust-enrichment claim.