535 F.Supp.3d 775
N.D. Ill.2021Background
- Plaintiff Stephanie Lukis sued Whitepages, Inc. in Illinois court under the Illinois Right of Publicity Act (IRPA), alleging Whitepages used her identity to advertise its paid background-report services; the case was removed to federal court.
- Whitepages’s website offers free name-based previews and paid, more detailed reports; its online Terms of Use include a clickwrap arbitration clause, a class-action waiver, and a Washington forum-selection fallback.
- During litigation, plaintiff’s counsel (Beaumont Costales) purchased a Whitepages product and clicked through the Terms of Use; Whitepages waited months after that conduct to move to compel arbitration and to transfer venue.
- Lukis moved to add two additional putative class representatives allegedly not subject to arbitration; Whitepages moved to strike class allegations and class counsel; both parties filed multiple discovery motions concerning Whitepages’s non-party data providers and Lukis’s device/account data.
- The court denied Whitepages’s motion to compel arbitration or transfer (finding Whitepages waived arbitration by litigation delay), granted Lukis leave to amend, denied the motion to strike without prejudice, granted and denied parts of the discovery motions as detailed below, and extended fact discovery to June 22, 2021.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether arbitration must be compelled | Lukis: arbitration defense waived by Whitepages’ delay; no timely motion | Whitepages: Terms bind Lukis (via counsel’s clickthrough) and delegates arbitrability to arbitrator; move to compel and transfer | Court: Whitepages waived arbitration by litigation conduct/delay; motion denied |
| Who decides arbitrability (delegation clause) | Lukis: waiver of arbitration through litigation is for the court to decide | Whitepages: clause delegates all threshold questions (including waiver) to arbitrator | Court: waiver-by-litigation is for the court, not delegable to arbitrator; delegation clause not dispositive here |
| Transfer under forum-selection clause | Lukis: IRPA claim isn’t a contract "Dispute" and clause not triggered | Whitepages: Terms’ forum clause requires transfer to Western District of Washington | Court: Clause does not apply to IRPA claim and its preconditions (arbitrator finding or class-waiver invalidation) are unmet; transfer denied |
| Motion to amend to add class reps | Lukis: moved promptly after arbitration challenge; new reps not subject to arbitration | Whitepages: amendment futile; new reps possibly bound by arbitration; delay/bad faith | Court: Leave granted—timely and proper to add reps in response to arbitration challenge |
| Motion to strike class allegations and counsel | Lukis: class allegations facially plausible; discovery needed for certification analysis | Whitepages: deposition shows inadequacy; counsel’s conduct undermines adequacy; class definition should exclude those who agreed to arbitrate | Court: Denied without prejudice; Whitepages may raise these arguments in opposition to class certification |
| Lukis’s motion to compel discovery re: data providers | Lukis: Whitepages’ contracts/relationships with data vendors are relevant to (a) non-commercial exemption defense and (b) consent/third-party-consent theory | Whitepages: confidentiality agreements with vendors and relevance objections | Court: Motion granted—Whitepages must disclose vendor identities, contracts, and testify; confidentiality objection untenable; produce specified interrogatory/document responses |
| Whitepages’s motion to compel Lukis’s devices/accounts and other items | Whitepages: plaintiff’s online accounts, browser history, engagement letter, employment apps, etc., are relevant to consent, damages, credibility | Lukis: requests overbroad, many items irrelevant or burdensome; Local Rule 37.2 confer requirement not met for most items | Court: Denied for many items due to failure to meet Local Rule 37.2; granted limited relief—produce same kinds of data from MySpace/YouTube/Google+ as produced for Facebook and supplement browser-history responses; produce privilege log issues as required |
| Extension of fact discovery | Lukis: needed to pursue ordered discovery | Whitepages: opposed as delay | Court: Good cause shown; fact discovery extended to June 22, 2021 |
Key Cases Cited
- Halim v. Great Gatsby’s Auction Gallery, Inc., 516 F.3d 557 (7th Cir. 2008) (stay—don’t dismiss—when enforcing arbitration clauses)
- Tinder v. Pinkerton Sec., 305 F.3d 728 (7th Cir. 2002) (FAA mandates enforcement of valid arbitration agreements)
- Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) (procedural questions of arbitrability presumptively for arbitrator)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (federal policy favoring arbitration but limits on arbitrability delegation)
- Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63 (2010) (parties may agree to arbitrate gateway questions)
- Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019) (enforcement of clear delegation clauses)
- Smith v. GC Servs. L.P., 907 F.3d 495 (7th Cir. 2018) (arbitration right can be waived by litigation conduct)
- Cabinetree of Wis., Inc. v. Kraftmaid Cabinetry, Inc., 50 F.3d 388 (7th Cir. 1995) (standard for waiver by litigation conduct)
- Brickstructures, Inc. v. Coaster Dynamix, Inc., 952 F.3d 887 (7th Cir. 2020) (waiver inquiry considers whether party acted inconsistently with right to arbitrate)
- Dancel v. Groupon, Inc., 949 F.3d 999 (7th Cir. 2020) (elements of an IRPA claim)
- Gupta v. Morgan Stanley Smith Barney, LLC, 934 F.3d 705 (7th Cir. 2019) (court may hold trial on formation of arbitration agreement)
- Halcon Int’l, Inc. v. Monsanto Austl. Ltd., 446 F.2d 156 (7th Cir. 1971) (section 3 gives courts jurisdiction to determine default/waiver)