Cornerstone Consultants, Inc. v. Production Input Solutions, L.L.C., 789 F. Supp. 2d 1029

Background

Plaintiffs CCI and Qualy allege defendants PIS, VAST, PrairiE, Howard, and Hagen violated the Stored Communications Act (SCA) and related state-law claims.
PrairiE allegedly provided and managed an Exchange server that stored plaintiffs' emails, including personal emails, via synchronization from Qualy's laptop.
Allegations state that after June 23, 2009, defendants accessed the Exchange server; PrairiE allegedly archived Qualy's emails and backed up emails copied to the server.
CCI and Qualy contend emails not provided by PIS/VAST were stored on the server and accessed without authorization or in excess of authorization.
Contract history: Qualy became a minority owner of PIS and VAST in 2007; PIS contracted with CCI in 2008 for consulting; ownership interests were repurchased by PIS/VAST in 2009; mediation later revealed possession of personal emails by defendants.
Procedural posture: moving defendants sought dismissal of Count I (SCA §2701) under Rule 12(b)(6) and dismissal of Counts IV–V under 28 U.S.C. § 1367; PrairiE remained as to Counts II and III.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §2701(a) claim is plausibly pled	Plaintiffs argue PrairiE provided the relevant service and exceeded authorization by accessing and archiving emails.	Defendants argue either PIS/VAST or PrairiE were the provider and that access was authorized; the claim fails for lack of plausible lack of authorization.	Count I dismissed for failure to plead lack of authorization or excess thereof.
Who is the 'provider' under §2701(c)	PrairiE is the provider of the electronic communications service for the PIS/VAST email system.	PIS/VAST are the providers or PrairiE’s role is insufficient to trigger the exemption; access was authorized.	The court finds the provider question unresolved on the pleadings; nonetheless Count I fails on lack of adequately pleaded lack of authorization.
Whether authorization allegations are pleaded sufficiently	Allegations show PrairiE administered the server; lack of authorization can be inferred from archiving and mixed email profiles.	There is no clear allegation that PrairiE did not authorize access or that access exceeded any provider's authorization.	Element two insufficiently pleaded; §2701(a) claim fails.
Whether elements 3–4 (obtaining/altering/ or preventing access and actual harm) are pled	Plausible inference that emails were obtained and harms occurred, including mediation impact and privacy harms.	Even if emails were obtained, the pleadings do not tie to the specific element of unauthorized access to the facility or causation of harm.	Elements 3–4 are adequately pled, but overall claim fails due to element 2.
Whether Counts IV–V should be dismissed or retained under supplemental jurisdiction	If a federal claim remains, supplemental jurisdiction should cover state-law claims.	If Count I is dismissed, court should decline supplemental jurisdiction over Counts IV–V.	Court declines to dismiss Counts IV–V at this stage; retains supplemental jurisdiction.

Key Cases Cited

Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading must show plausible claims, not just conclusory statements)
Ashcroft v. Iqbal, 129 S. Ct. 1937 (S. Ct. 2009) (plausibility standard for surviving a Rule 12(b)(6) motion)
Councilman v. National Solid Wastes Mgmt. Ass'n, 418 F.3d 67 (1st Cir. 2005) (SCA background and § 2701(c) exemptions)
Theofel v. Farey-Jones, 359 F.3d 1066 (9th Cir. 2004) (authorization and consent under § 2701(c)(1) relevance)
Van Alstyne v. Electronic Scriptorium, Ltd., 560 F.3d 199 (4th Cir. 2009) (trespass analogy and damages under § 2701)
Fraser v. Nationwide Mut. Ins. Co., 352 F.3d 107 (3d Cir. 2003) (provider understanding § 2701(c)(1) abstraction)
DoubleClick, Inc. Privacy Litig., 154 F. Supp. 2d 497 (S.D.N.Y. 2001) (definition of electronic communications service and provider)
Warshak v. United States, 631 F.3d 266 (6th Cir. 2010) (electronic communications service scope under the SCA)