Divino Group LLC v. Google LLC

Background

Divino Group LLC, Chris Knight, Celso Dulay, Cameron Stiehl, BriaAndChrissy LLC, Bria Kam, Chrissy Chambers, Chase Ross, Brett Somers, Lindsey Amer, Stephanie Frosch, Sal Cinquemani, Tamara (Sheri) Johnson, and Greg Scarnici sued Google LLC and YouTube, LLC. The plaintiffs alleged that they were LGBTQ+ content creators who used YouTube and that defendants discriminated against their sexual or gender identities and viewpoints.

The alleged conduct included applying age restrictions and YouTube’s optional Restricted Mode to some videos, limiting recommendations and subscriber notifications, changing thumbnails, allegedly “shadow banning” videos from search results, and preventing advertisements from running on some videos. The plaintiffs also alleged that defendants favored anti-LGBTQ+ content and engaged in anticompetitive conduct. They asserted claims under the First Amendment through 42 U.S.C. § 1983, the California Constitution, the Unruh Act, California’s unfair-competition law, the implied covenant of good faith and fair dealing, and the Lanham Act. They also sought declaratory relief concerning the constitutionality of Section 230 of the Communications Decency Act and defendants’ alleged violations.

Rulings on the Federal Claims

The court granted defendants’ motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim.

For the First Amendment claim, the court held that Google and YouTube were private entities rather than state actors. Section 1983 requires conduct under color of state law. The court rejected the plaintiffs’ arguments that YouTube had made itself a public forum or that Section 230 transformed defendants’ conduct into government action. The court also found that the plaintiffs had not alleged that the government compelled, encouraged, endorsed, or participated in the challenged decisions. The First Amendment claim was dismissed with prejudice because the court found amendment would be futile.

The plaintiffs withdrew their false-association claim under the Lanham Act at the hearing, leaving only false advertising. The court dismissed that claim, relying on a Ninth Circuit decision involving YouTube’s Restricted Mode. The court held that notices explaining that videos were unavailable when Restricted Mode was enabled were not commercial advertising or promotion and did not communicate a specific misleading representation about the videos. The plaintiffs received leave to amend the Lanham Act false-advertising claim.

State-Law Claims

The remaining state-law claims alleged violations of the California Constitution and Unruh Act, unfair competition, and breach of the implied covenant of good faith and fair dealing. The court declined to exercise supplemental jurisdiction, meaning it chose not to decide those state-law claims after dismissing the federal claims. The court cited the early pleading stage, the lack of discovery, judicial economy, and the importance of allowing California courts to address unsettled questions of California law. The claims were dismissed without prejudice.

The court also considered whether the Class Action Fairness Act could provide original jurisdiction. Although the complaint included class-action allegations, the plaintiffs did not expressly invoke that statute and did not plausibly allege the required amount in controversy. The court therefore did not exercise jurisdiction under the Class Action Fairness Act.

Declaratory-Relief Claims and Section 230

The court dismissed the claim seeking a declaration that Section 230 was unconstitutional. It did not decide whether Section 230 immunity applied to the plaintiffs’ claims or whether the statute was constitutional. The court reasoned that declaratory relief is a remedy rather than an independent claim, that the plaintiffs were improperly anticipating an affirmative defense, and that the constitutional issue did not need to be reached after the federal claims were dismissed and supplemental jurisdiction over the state claims was declined.

The court also dismissed the plaintiffs’ omnibus declaratory-relief claim, which sought declarations concerning all of the constitutional, statutory, state-law, and contract theories in the complaint. The court stated that the claim was improper and dismissed it because the federal claims did not establish jurisdiction and the court declined supplemental jurisdiction over the state claims.

Disposition

The court granted defendants’ motion to dismiss the second amended complaint with limited leave to amend. The First Amendment claim was dismissed with prejudice. The Lanham Act false-advertising claim was dismissed with leave to amend. The state-law claims were dismissed without prejudice, and the declaratory-relief claims were dismissed. Plaintiffs could file an amended complaint by January 20, 2021, and could reassert the state-law claims at the same time as an amended Lanham Act claim. They could not add new federal or state claims without court permission.