Chegg, Inc. v. Doe

Background

Chegg operates Chegg Study, an online learning service that provides step-by-step textbook solutions behind a paywall. Chegg alleged that the defendants obtained its content and reposted it on Homeworkify, allowing users to view the materials without paying for Chegg subscriptions. Chegg further alleged that the defendants used stolen subscriber credentials to access Chegg accounts and launched a cyberattack that caused an outage on Chegg.com.

Chegg asserted claims under the federal Computer Fraud and Abuse Act, California Penal Code section 502, California’s unfair-competition law, contract law, and the Lanham Act’s trademark provisions. The court had previously denied Chegg’s preliminary-injunction and alternative-service requests. In the renewed motion, Chegg presented additional evidence concerning unauthorized access, the cyberattack, irreparable harm, its new unfair-competition claim, and the defendants’ likely location outside the United States.

Alternative Service

Federal Rule of Civil Procedure 4(f)(3) allows a court to authorize service on an individual outside the United States by methods not prohibited by an international agreement. The court ruled that Chegg supplied sufficient evidence that Defendant Swami likely lived in India. The evidence included statements by the user behind the Telegram account @theviikash, an IP address resolving to a city in Rajasthan, responses at times consistent with India Standard Time, and information linking that user to the name Vikasa Swami.

The court found that service through specified email addresses and the @theviikash Telegram account was reasonably calculated to notify Swami of the case and give him an opportunity to respond. It therefore granted Chegg’s request for alternative service as to Swami.

The court reached a different result for John Does 1–3. Evidence that certain Telegram channels used India Standard Time and that one user said most paid Chegg bot channels were Indian did not establish that these specific defendants lived in India or outside the United States. The court also found that serving them through Homeworkify’s registered email address was not reasonably calculated to notify them, particularly because the record did not show that they directly operated the site. The court denied Chegg’s request for alternative service as to John Does 1–3 without prejudice.

Preliminary Injunction

A preliminary injunction is temporary court-ordered relief issued before a final judgment. To obtain one, Chegg had to show a likelihood of success on the merits, likely irreparable harm without an injunction, that the balance of equities favored relief, and that an injunction served the public interest.

The court adopted its earlier findings that Chegg was likely to succeed on its breach-of-contract and Lanham Act claims and that the balance of equities and public interest favored Chegg. Based on the new evidence, the court also found a likelihood of success on Chegg’s Computer Fraud and Abuse Act claim. The evidence showed that defendants allegedly used stolen credentials to access legitimate subscriber accounts without authorization, including after Chegg sent a cease-and-desist letter. The court also found compelling evidence that defendants were behind the cyberattack because IP addresses used in the attack were connected to Homeworkify and Swami, and the attack occurred the day after Chegg sought to have Homeworkify’s domains taken down.

The court likewise found a likelihood of success on the California section 502 claim because the alleged unauthorized access involved knowingly taking, copying, or using data. It found a likelihood of success on the unfair-competition claim because that claim could rely on the alleged violations of the other laws. The court did not need to decide whether Chegg had sufficiently shown harm from losing prospective customers because it found irreparable harm based on the defendants’ continuing unauthorized access to Chegg’s materials and the likelihood that the access would continue without court intervention.

Scope and Disposition

Judge Charles R. Breyer granted Chegg’s motion for a preliminary injunction. The order temporarily restrained the defendants, their representatives, and persons acting together with them from accessing Chegg’s website without authorization, downloading, scraping, using, or disseminating Chegg content, operating Homeworkify, and using or infringing Chegg’s trademarks. It also barred deceptive designations and conduct suggesting that the defendants’ activities were affiliated with or sponsored by Chegg.

Using the All Writs Act, the court directed U.S.-located domain registries and registrars identified in the order to unlock and change the registrar of record for the Homeworkify and redirect-site domains, register them in Chegg’s name for 30 days, prevent the defendants from transferring, modifying, or deleting them, and propagate the changes through the domain-name system. For domain registries outside the United States, the court requested, but did not order, the same or substantially similar actions. The order required Chegg to post a $15,000 bond into the court registry.