Berryman v. Reading International, Inc.

Background

Haley Berryman brought a proposed class action against Reading International, Inc., which operates Angelika Film Centers and the AngelikaFilmCenter.com website. She alleged that Reading used Facebook’s Meta Pixel to send Facebook personally identifiable information and data about users’ activity on the website, including videos watched and tickets purchased, without users’ knowledge or consent. She also alleged that Reading failed to disclose the total ticket cost, including a $2.19-per-ticket service charge, at the beginning of the online purchase process.

The complaint asserted claims under the Video Privacy Protection Act (VPPA), a federal law restricting disclosure of information about a consumer’s video-watching activity, and § 25.07(4) of the New York Arts and Cultural Affairs Law (NYACAL), which requires entertainment-ticket sellers to disclose total ticket costs and fees before the ticket is selected for purchase. Reading moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), separately challenged Berryman’s standing to bring the NYACAL claim under Rule 12(b)(1), and moved under Rule 12(f) to strike the proposed class allegations.

VPPA Claim

The court denied dismissal of the VPPA claim. It held that Berryman plausibly alleged that Reading was a “video tape service provider” because its website delivered hundreds of prerecorded videos. Under Second Circuit precedent, an entity may qualify even if video content is only part of its business. The court rejected Reading’s argument that its video offerings were merely peripheral.

The court did not accept Berryman’s separate theory that Reading qualified as a video tape service provider merely because it operated movie theaters. A theater sells tickets and does not rent, sell, or deliver films to theatergoers within the meaning of the VPPA. The court therefore allowed the website-based theory to proceed but rejected the theory based on viewing movies in Reading’s physical theaters.

Reading initially argued that Berryman was not a VPPA “consumer,” but abandoned that argument after an intervening Second Circuit decision. The court held that Berryman plausibly alleged that she was a consumer because she provided personal information to access Reading’s newsletter and online video content.

NYACAL Claim

The court denied both challenges to the NYACAL claim. On standing, Reading argued that Berryman suffered no legally recognized injury because she saw the service charge before completing her purchase. The court held that Berryman adequately alleged a concrete economic injury: paying a fee that she claimed was unlawful because Reading did not disclose it at the required point in the purchase process. The court stated that whether the fee was actually unlawful was a merits issue, not a question of standing.

On the pleading issue, Reading argued that disclosure of the service charge on the seat-selection page was timely because it occurred before the final confirmation and payment page. The court disagreed, reasoning that the statute requires the total cost and fees to appear in the ticket listing before the ticket is selected for purchase. Because Berryman alleged that the earlier ticket-selection page omitted the fee, she plausibly stated a NYACAL claim.

The court also rejected Reading’s argument that the voluntary-payment doctrine barred the claim. That doctrine generally limits recovery of payments made with full knowledge of the relevant facts, but the court explained that it does not apply when the claim is based on a lack of full disclosure. The court found that resolving this issue before discovery would be premature.

Class Allegations and Disposition

Reading sought to strike the proposed VPPA and NYACAL classes as overbroad or insufficiently defined. The court granted the motion to strike as to the proposed VPPA movie-screening class because the court had rejected the theory that operating physical movie theaters made Reading a VPPA video tape service provider.

The court denied the balance of the Rule 12(f) motion as premature. It stated that discovery could produce facts relevant to class certification. The court’s denial of the remaining part of the motion was without prejudice to Reading pursuing the same or similar relief later in the case.

The court denied Reading’s motions to dismiss under Rules 12(b)(1) and 12(b)(6). It granted in part and denied in part Reading’s Rule 12(f) motion to strike, granting it as to the VPPA movie-screening class and denying the remainder as premature. The court directed the clerk to close the pending motions and stated that a separate order would schedule a case-management conference.