In re Vizio, Inc., Consumer Privacy Litigation
238 F. Supp. 3d 1204
| C.D. Cal. | 2017Background
- Vizio manufactures Smart TVs with preinstalled or updated software (Internet Apps, Internet Apps Plus, SmartCast) that stream on-demand video and are marketed at a premium for that functionality.
- Plaintiffs allege Vizio’s “Smart Interactivity”/Inscape automatically collects detailed viewing data and device identifiers (e.g., MAC, IP, zip code, chipset IDs, model, software versions) and sells the data to third parties, enabling targeted advertising.
- Plaintiffs contend disclosures were inadequate: Smart Interactivity shipped enabled by default, the opt-out was buried and sometimes nonfunctional, resets re-enable the feature, and privacy notices were obscure or misleading about anonymity.
- Named plaintiffs allege they purchased Smart TVs unaware of the data practices, would have paid less or not bought them, and changed behavior after learning the practices (disconnected or stopped streaming).
- Claims include federal VPPA and Wiretap Act counts; state consumer-protection, fraud, negligent misrepresentation, invasion of privacy/intrusion, state video-privacy statutes, and unjust enrichment. Defendants moved to dismiss on standing and failure-to-state grounds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Article III standing | Plaintiffs suffered concrete injuries from privacy invasions and economic overpayment | Injuries are speculative/abstract and insufficient | Denied: Plaintiffs plausibly alleged concrete informational and economic injuries (privacy tort history + price-premium) |
| Statutory standing for state consumer claims | Plaintiffs paid a premium or would not have purchased absent omissions | Plaintiffs lack cognizable statutory injury | Denied: price-premium theory sufficient for UCL, CLRA, FAL (Cal.), FDUTPA (Fla.), Mass. Ch.93A; plausibly for NY GBL as well |
| VPPA — "video tape service provider" | Vizio’s TVs and platform deliver video content and are tailored for that business | VPPA covers only content providers (Netflix, Hulu), not device makers | Denied: Vizio plausibly engages in delivery of video content via integrated apps and ecosystem |
| VPPA — "consumer/subscriber" | Plaintiffs paid a premium and receive ongoing services/updates — thus subscribed | Plaintiffs are not subscribers because no separate account/payment | Denied: plaintiffs plausibly are "subscribers" due to paid product and ongoing service/association |
| VPPA — "personally identifiable information" (PII) | The combination of device IDs, MAC, IP, location, viewing history can reasonably identify viewers | Disclosed data are only device identifiers and not PII under VPPA | Denied: court finds plaintiffs plausibly alleged PII (relies on Yershov approach and aggregation theory); factual question for later |
| Wiretap Act — interception | Plaintiffs allege real-time interception of electronic communications | Defendants say no contemporaneous interception; data collected from storage or not "contents" | Dismissed with leave to amend: plaintiffs failed to plead when/how interception occurred with sufficient specificity |
| Fraud (Rule 9(b)) — omissions vs. affirmative misrep | Omissions (failure to disclose data practices) and misstatements about anonymity | Defendants say Rule 9(b) not satisfied; need specifics and reliance | Mixed: omission-based frauds survive (sufficient particulars); affirmative-misrep claims dismissed with leave to amend (lack of who/when/where/reliance) |
| Negligent misrepresentation | Vizio’s packaging and statements implied privacy assurances | Statements are too tangential; omission alone insufficient | Dismissed with leave to amend: plaintiffs failed to plead the required positive assertions/reliance |
| False Advertising Law (FAL) — reliance | Vizio made partial statements implying anonymity; omissions render them misleading | Plaintiffs did not allege they relied on or saw specific misstatements | Dismissed with leave to amend: plaintiffs must allege at least general awareness/reliance on statements |
| Intrusion / invasion of privacy | Collection and disclosure of viewing history and identifiers is a serious, offensive intrusion, and Vizio misled users about opting out | Defendants say routine data collection not legally protected privacy interest | Denied: plaintiffs plausibly alleged highly offensive intrusion given sensitivity, scope, default-on and reactivation practices |
| Unjust enrichment | Plaintiffs conferred benefit (overpayment / data) and seek restitution | Defendants say adequate legal remedies make unjust enrichment unavailable | Denied: claims allowed at pleading stage (may proceed in alternative) |
Key Cases Cited
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (intangible informational harms and Congress’s role inform Article III concreteness analysis)
- Lujan v. Defs. of Wildlife, 504 U.S. 555 (1992) (standing elements and pleading-stage standards)
- Kwikset Corp. v. Super. Ct., 51 Cal.4th 310 (2011) (consumer deception causing payment premium constitutes loss of money or property under UCL)
- Konop v. Hawaiian Airlines, Inc., 302 F.3d 868 (9th Cir. 2002) (Wiretap Act requires acquisition contemporaneous with transmission)
- United States v. Szymuszkiewicz, 622 F.3d 701 (7th Cir. 2010) (interception can include copies made within a second of arrival; contemporaneity doctrine applied to modern packet communications)
- Yershov v. Gannett Satellite Info. Network, Inc., 820 F.3d 482 (1st Cir. 2016) (VPPA "personally identifiable information" may extend beyond name; provision of personal data can create subscriber status)
- In re Nickelodeon Consumer Privacy Litig., 827 F.3d 262 (3d Cir. 2016) (narrower view of VPPA PII; court contrasted legislative-history emphasis with textual reading)
- Hinojos v. Kohl's Corp., 718 F.3d 1098 (9th Cir. 2013) (economic injury from paying a premium supports Article III standing in consumer cases)