Meta Platforms, Inc. v. BrandTotal Ltd.
3:20-cv-07182
N.D. Cal.Feb 19, 2021Background
- BrandTotal’s browser extensions (UpVoice and Ads Feed) collected ad-view and demographic data from Facebook and Instagram by using users’ browsers as proxies, scraping both public and non-public information and sending it to BrandTotal.
- Facebook alleges the extensions violated its Terms of Service (prohibiting automated data collection) and disabled BrandTotal’s accounts and took steps (including notifying Google) that led to removal of the extensions from the Chrome Web Store.
- Facebook sued BrandTotal for breach of contract, CFAA and other claims; BrandTotal counterclaimed for intentional interference (contract and prospective economic advantage), UCL (unlawful, unfair, fraudulent), and declaratory relief that it did not breach the Terms.
- The court previously denied BrandTotal a TRO; BrandTotal sought a preliminary injunction. Facebook moved to dismiss BrandTotal’s counterclaims under Rule 12(b)(6).
- The court granted Facebook’s motion: all counterclaims dismissed; BrandTotal’s UCL “fraudulent” prong dismissed with prejudice; leave to amend granted for interference claims and the UCL’s unlawful and unfair prongs; declaratory judgment claim denied (leave to amend denied as redundant, subject to change in circumstances).
- The court relied in part on BrandTotal’s own allegations (showing automated access), Facebook’s legitimate business interest in enforcing its Terms, and an FTC order requiring Facebook to deny access by noncompliant third parties.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Declaratory judgment (non-breach of Terms) | Terms are unenforceable as contrary to public policy | BrandTotal’s admissions show no breach; seek declaratory relief | Dismissed; BrandTotal’s pleadings admit automated access so no non-breach; leave to add redundant declaratory claim denied (without prejudice to later motion if circumstances change) |
| Intentional interference with contract | Facebook’s actions disrupted BrandTotal’s contracts and business; knew effect of takedown | Facebook lacked intent; acted to enforce ToS and comply with FTC order; no specific wrongful act | Dismissed; claim undermined by Facebook’s legitimate business purpose and FTC compliance defense; leave to amend allowed but success uncertain |
| Intentional interference with prospective economic advantage | Lost customers/investors from Facebook’s conduct suffice to plead interference | Failure to plead specific relationships, knowledge, or independently wrongful act; lawful enforcement/FTC compliance justifies conduct | Dismissed; similar rationale to contract interference; leave to amend allowed |
| UCL — unlawful / unfair / fraudulent | Unlawful: based on interference; Unfair: Facebook abused dominance; Fraudulent: users reasonably relied on Facebook’s statements about data ownership | Unlawful/unfair fail because Facebook acted to enforce Terms and comply with FTC; BrandTotal alleges harm to competitor only, not competition; fraud lacks particularized misrepresentation and reasonable reliance | "Unlawful" prong dismissed (FTC compliance); "Unfair" prong dismissed but leave to amend to allege competition-level injury; "Fraudulent" prong dismissed with prejudice (no particularity or reasonable reliance) |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must plead plausible claim beyond labels and conclusions)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (courts need not accept legal conclusions as true at pleading stage)
- HiQ Labs, Inc. v. LinkedIn Corp., 938 F.3d 985 (9th Cir. 2019) (discussing tortious interference and legitimate business purpose balancing)
- Korea Supply Co. v. Lockheed Martin Corp., 29 Cal.4th 1134 (2003) (elements and standards for tortious interference under California law)
- Cel‑Tech Commc’ns, Inc. v. L.A. Cellular Tel. Co., 20 Cal.4th 163 (1999) (standard for UCL "unfair" prong implicating antitrust policy)
- Atlantic Richfield Co. v. USA Petroleum Co., 495 U.S. 328 (1990) (antitrust laws protect competition, not competitors)
- Reeves v. Hanlon, 33 Cal.4th 1140 (2004) (prospective economic advantage claims require independently wrongful act)
- Semler v. General Electric Capital Corp., 196 Cal. App. 4th 1380 (2011) (complying with legal requirements can justify conduct as legitimate business purpose)