Williams v. DDR Media, LLC

Background

Lead Intelligence, Inc., doing business as Jornaya, provides TCPA Guardian, software that websites use to document users’ consent to telemarketing calls. The software includes a “visual playback” feature that records users’ keystrokes and clicks while they interact with client websites. DDR Media, LLC, doing business as Royal Marketing Group, owns scrappyrent2own.com, where TCPA Guardian was installed.

Williams alleged that on December 10, 2021, she visited DDR Media’s website and that DDR Media and Jornaya recorded her interaction in real time. The alleged recording included her Internet Protocol address, geographic location, name, address, phone number, keystrokes, and clicks. She alleged that DDR Media did not disclose the recording or obtain her prior consent.

Williams asserted claims under California Penal Code § 631(a), California’s Unfair Competition Law, and the California Constitution. DDR Media moved to dismiss for failure to state a claim, lack of subject-matter jurisdiction, and lack of standing under Article III of the Constitution. Jornaya moved to dismiss for failure to state a claim. The court had previously denied the defendants’ motion to compel arbitration.

Unfair-Competition Claim

The defendants argued that Williams had not alleged an injury involving loss of money or property, which is required for standing under California’s Unfair Competition Law. Williams conceded that she lacked standing for this claim. The court therefore granted the motion to dismiss the claim without leave to amend.

California Penal Code § 631(a)

Williams alleged that Jornaya violated the statute’s provision concerning a person who, without consent, reads or learns the contents or meaning of a communication. She alleged that DDR Media was liable under the provision concerning a person who aids, agrees with, employs, or conspires with another person to commit a prohibited act.

The defendants argued that Jornaya merely enabled DDR Media to record its own communications, did not act as a third-party eavesdropper, and did not intercept protected information while it was in transit. The court discussed differing district-court decisions about whether software vendors that record website interactions are third-party eavesdroppers.

The court held that Jornaya was more like a tape-recorder vendor than an eavesdropper. It reasoned that Jornaya recorded the communication so that a party to the same communication could retrieve it, but the allegations did not sufficiently show that a third party read, attempted to read, or learned the communication’s contents or meaning. The court dismissed the Section 631(a) claim. The order’s conclusion states that leave to amend was granted as to Williams’s other claims.

California Constitutional Privacy Claim

To state a California constitutional privacy claim, Williams had to allege a legally protected privacy interest, a reasonable expectation of privacy, and conduct that amounted to a serious invasion of privacy. Courts often describe the central questions as whether there was a reasonable expectation of privacy and whether the intrusion was highly offensive.

The court rejected Williams’s argument that the question could never be resolved at the pleading stage. It compared her allegations with cases involving more extensive or continuing tracking, including tracking after users left a website or application, and cases involving the sale of information to third parties.

The court found that Williams alleged a limited intrusion during a single website visit. The information allegedly collected included the date and time of the visit, keystrokes, clicks, name, Internet Protocol address, geographic location, address, and phone number. The court also noted that the information was sent back to the same website Williams had visited and that she alleged no third-party use beyond storing the information for DDR Media to retrieve. The court concluded that the alleged intrusion was not highly offensive and granted the motion to dismiss this claim with leave to amend.

Disposition

The court granted defendants’ motions to dismiss. It dismissed the Unfair Competition Law claim without leave to amend, dismissed the Section 631(a) claim, and granted leave to amend the other claims. The order required any amendment by September 20, 2023, and stated that claims not amended by that date would be dismissed with prejudice.