Sheski v. Shopify Inc.

Background

David Sheski filed a proposed nationwide class action against Shopify (USA) Inc. and Shopify Inc. The complaint alleged violations of the Telephone Consumer Protection Act (TCPA), along with negligence, invasion of privacy, and unlawful intrusion under state common law.

Sheski alleged that Shopify provides e-commerce infrastructure and software, including checkout pages that collect consumers’ telephone numbers. He entered his phone number into a Shopify-branded checkout form that identified the number as being for “shipping updates.” The form allegedly did not include a checkbox for written consent to receive advertising texts. On or about November 26, 2018, he received two texts advertising a retailer called Masorini and offering a Cyber Monday discount.

TCPA claims

The court explained that a TCPA claim involving text messages requires allegations that the defendant called a cellular number using an automatic telephone dialing system, without the recipient’s prior express consent. The court treated a text message as a “call” for TCPA purposes.

The court granted the motion to dismiss the direct-liability TCPA claim because the complaint did not provide a factual basis to show that Shopify sent, or was directly involved in sending, the messages. Shopify’s checkout templates, texting applications, marketing guidance, revenue share, and use of a common short code did not plausibly show that Shopify controlled the retailer’s text-marketing campaign. The messages identified Masorini as the sender, and the allegations suggested that the retailer—not Shopify—sent the messages.

The court also dismissed the TCPA vicarious-liability claim. Vicarious liability can apply when an agency relationship exists between a defendant and the person or entity that sent the messages. The court found that the complaint did not plausibly allege that Shopify controlled the retailer or that the retailer acted on Shopify’s behalf. The allegation that Shopify received a percentage of retail revenue was not enough to support an agency relationship.

State-law claims

The court dismissed the negligence claim. Under California law, negligence requires a duty, a breach, a sufficiently close connection between the conduct and injury, and actual damages. The court found that Sheski did not adequately allege that Shopify owed him a duty, particularly because the complaint did not establish an exception to the general rule that a person ordinarily has no duty to protect others from third parties’ conduct. The court also found that he did not allege damages: he did not claim that he was charged for the texts or that additional texts resulted from disclosure of his phone number.

The court treated the invasion-of-privacy and unlawful-intrusion claims as one claim for unreasonable intrusion upon seclusion because unlawful intrusion is an alternative way to plead an invasion-of-privacy claim. The court dismissed both causes of action, finding that entering a phone number into a checkout form and receiving two retailer-related marketing texts did not amount to an intrusion that would be highly offensive to a reasonable person, even if the number had been provided only for shipping updates.

Disposition

The court granted the defendants’ motion to dismiss the class action complaint for failure to state a claim, with leave to amend. Any amended complaint had to be filed within 28 days and could not add new claims or defendants. The court denied the defendants’ motion to strike as moot, stating that the defendants could raise that argument again depending on the contents of any amended complaint. Judge Haywood S. Gilliam, Jr. signed the order.