Ray v. Google North America Inc.
- Thomas Hixson
- 3:23-cv-04222
- U.S. District Court · Northern District of California
- 15
In Ray v. Google LLC, Judge Hixson dismissed Ray’s payment lawsuit with prejudice after finding the contracts did not promise $22 per view.
Robert James Ray’s breach-of-contract case against Google LLC was dismissed with prejudice; Google LLC prevailed on the motion to dismiss, although the court rejected its argument that Ray’s claim was entirely barred by the contractual time and notice provisions.
What happened
In Ray v. Google LLC, Robert James Ray, a YouTube user without a lawyer, claimed Google failed to pay him up to $22 for each view of his videos. He sued for breach of contract and sought money damages.
Google asked the court to dismiss the case, arguing that the agreements did not promise per-view payments and that Ray’s claims were barred by contract deadlines and dispute procedures. The court rejected Google’s argument that the claims were entirely barred at this stage, but found that the governing agreements promised Ray 55% of qualifying advertising and subscription revenue—not a fixed amount for each view.
The court granted Google’s motion to dismiss and dismissed the case with prejudice because changing the complaint would not fix the problem. Judge Hixson also denied Ray’s request to add a fraudulent-inducement claim because the agreements clearly stated how payments would be calculated.
The detailed version
- Ray v. Google North America Inc. · No. 3:23-cv-04222
- Thomas Hixson
- Nov. 6, 2023
Background
Robert James Ray, proceeding without a lawyer, alleged that Google failed to pay him up to $22 for each public view of videos on his YouTube channel. He asserted a breach-of-contract claim and sought at least $15 million in contract damages, along with damages for mental pain and suffering, punitive damages, and attorney’s fees.
Ray alleged that he joined YouTube’s Partner Program after posting videos and creating an AdSense account. The court considered the YouTube Terms of Service, YouTube Partner Program Terms, and Google AdSense Online Terms because Ray’s complaint referred to those agreements. The agreements included California choice-of-law provisions.
Motion to Dismiss
Google moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim. Google argued that the agreements did not promise $22 per view, that Ray had waived his claim by failing to comply with contractual time and notice requirements, and that some requested damages were unavailable as a matter of law.
The court applied California law. It held that California had a substantial relationship to the transaction and that enforcing the parties’ choice-of-law provisions did not conflict with a fundamental California policy.
Contractual Payment Terms
The court held that the written agreements controlled. The YouTube Terms of Service stated that they did not entitle users to payments. The AdSense Terms described payment methods based on valid clicks, impressions, or other qualifying events but did not set a fixed dollar amount per view. The Partner Program Terms provided for payment of 55% of net advertising revenue from ads shown with the participant’s content and 55% of net subscription revenue.
Because the Partner Program Terms did not require Google to pay a fixed amount for each video view, the court held that Google had no contractual obligation to pay Ray $22 per view. The court also found that materials Ray submitted with his opposition did not establish such an obligation and declined to consider some materials because they were improperly submitted or of questionable authenticity.
The court rejected Ray’s argument that the agreements were unconscionable. Under California law, unconscionability requires both procedural unfairness, such as oppression or surprise, and substantively unfair terms. The court found that the agreements were not so one-sided as to be unconscionable and enforced them.
Contractual Time and Notice Provisions
The YouTube Terms included a one-year limit for bringing claims. The AdSense Terms required users to notify Google of a disputed nonpayment within 30 days and stated that failing to do so waived the claim. Google argued that Ray’s claim accrued around August 2021 and was filed nearly 17 months later.
The court concluded that Ray alleged an ongoing violation, not only a failure occurring in August 2021. Accepting his allegations as true at the motion-to-dismiss stage, the court could not determine that the entire claim was time-barred. It therefore denied Google’s motion as to the argument that Ray waived his right to sue under the YouTube and AdSense agreements.
Leave to Amend and Disposition
Ray asked to amend his complaint to add fraudulent inducement, a claim alleging that a contract was formed because a party was induced to agree through fraud. The court found amendment futile because the Partner Program Terms expressly described payment as a 55%-of-revenue arrangement, rather than a $22-per-view arrangement. The court concluded that Ray’s own allegations showed he received and agreed to those terms.
The court granted Google’s motion to dismiss. Because leave to amend would be futile, the court dismissed the case with prejudice and ordered judgment entered accordingly.
Read the full 15-page opinion on CourtListener, the free public archive maintained by the Free Law Project.