Garon v. Keleops USA, Inc.

Background

Jeffrey Garon brought a putative class action against Keleops USA, Inc., asserting one claim under section 638.51(a) of the California Invasion of Privacy Act. Garon alleges that Keleops owns and operates the Gizmodo website and causes three trackers to be installed in visitors’ browsers. According to the amended complaint, the trackers send IP addresses, browser and device information, and other identifying information to third parties for marketing, advertising, and analytics. Garon alleges that the trackers operate as “pen registers” under the statute and were installed without his consent or a court order.

Keleops moved to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint alleges enough facts and a valid legal theory to support a claim. Keleops also asked the court to take notice of three state-court rulings, requested permission to file a sur-reply, argued that the statutory exemption for operating an electronic communication service applied, and requested a stay while California Senate Bill 690 was pending.

Court’s analysis

The court granted Keleops’s request for judicial notice of the existence of the three state-court rulings. It also granted the parties’ stipulated request for Garon to file a sur-reply because Keleops’s reply raised new arguments.

The court denied dismissal based on Keleops’s argument that Garon had not adequately alleged a “pen register.” The statute defines a pen register as a “device or process” that records or decodes dialing, routing, addressing, or signaling information transmitted by an instrument or facility used for electronic or wire communications, but not the communications’ contents.

The court held that Garon’s allegations plausibly showed that the trackers were a device or process. It also held that the allegations plausibly showed that the trackers recorded addressing information because IP addresses identify devices and can indicate their approximate locations. The court noted that the complaint alleged that the trackers collected IP addresses but did not collect the content of users’ electronic communications with the website. The court rejected Keleops’s argument that the statute applies only to traditional telephone technology and relied on the statute’s broad language and decisions allowing similar claims involving software trackers to proceed.

The court also declined to dismiss the case based on the statutory exemption for a provider using a pen register to operate, maintain, or test an electronic communication service. Whether Keleops used the trackers for that purpose was a factual question that could not be resolved on a motion testing only the complaint’s sufficiency.

Finally, the court denied Keleops’s request for a stay. The court found that the pending legislation was too uncertain to justify pausing the case.

Disposition

The court denied Keleops’s motion to dismiss. It also denied Keleops’s request for a stay and ordered Keleops to file an answer to the amended complaint within two weeks of the order. The order allowed Garon’s claim to proceed past the pleading stage; it did not decide whether Keleops ultimately violated the statute or whether a class would be certified. Judge Donna M. Ryu signed the order as Chief Magistrate Judge.