635 F.Supp.3d 841
N.D. Cal.2022Background
- Plaintiffs (four Patreon users/subscribers) allege Patreon installed Facebook’s Pixel on its site and transmitted users’ video titles and Facebook IDs (FIDs) to Facebook without users’ standalone VPPA consent. They assert VPPA, UCL (unlawful, unfair, fraudulent), CLRA, and unjust enrichment claims.
- Patreon moved to dismiss under Rule 12(b)(6), arguing (inter alia) that VPPA does not apply because the videos were not alleged to be prerecorded, Patreon is merely a platform (not in the business of delivering videos), and FIDs are not personally identifiable information under VPPA.
- Patreon asked the court to consider its Terms of Use, Privacy Policy, and Cookie Policy (incorporated by reference); the court took judicial notice of those documents’ contents for disclosure-related issues but accepted plaintiffs’ factual allegations where policies and facts conflicted.
- The court held plaintiffs failed to allege that the videos at issue were "prerecorded," a statutory requirement under the VPPA, and dismissed the VPPA claim with leave to amend.
- The court rejected dismissal of plaintiffs’ UCL claims (fraudulent and unfair prongs), CLRA claim, and unjust enrichment claim, finding plaintiffs had plausibly alleged a duty to disclose the Pixel-based data sharing and an economic injury (they would have paid less or not subscribed had they known).
- The court declined to decide the constitutional challenge to the VPPA pending potential intervention by the United States and because dismissal on the prerecorded issue might render that question unnecessary.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether videos must be prerecorded for VPPA coverage | VPPA’s phrase “similar audio visual materials” covers streaming and broadly applies to videos on Patreon | VPPA requires prerecorded videos; live/broadcast content falls outside | The court held VPPA requires prerecorded videos; plaintiffs failed to allege this and VPPA claim dismissed with leave to amend |
| Whether Patreon is "engaged in the business" of delivering videos under VPPA | Patreon operates a subscription platform that delivers creators’ audiovisual content to paying users—sufficient to be "in the business" | Patreon is merely a platform connecting creators and fans, not a business of delivering videos | Court found plaintiffs’ allegations sufficiently plausible at pleading stage that Patreon could be "engaged in the business" of delivery, subject to amendment on prerecorded issue |
| Whether Facebook IDs (FIDs) are "personally identifiable information" under VPPA and whether Patreon knew it disclosed PII | FIDs enable anyone to locate a Facebook profile and thus identify video viewers; patrons did not consent | FIDs do not readily identify individuals to an ordinary person; Patreon may not have known Pixel transmitted FIDs or that plaintiffs had Facebook accounts | Applying Ninth Circuit precedent, court used the "ordinary person" identification test and concluded plaintiffs plausibly alleged FIDs could identify individuals; allegations on knowledge and identifiability survive pleading stage |
| UCL standing and "unlawful" prong dependence on VPPA/CLRA | Plaintiffs allege economic injury: they would not have subscribed or would have paid less had Patreon disclosed Pixel-based sharing; "unlawful" prong can rest on VPPA or CLRA violations | Patreon contends no cognizable money/property loss and that disclosure in privacy policy forecloses claims; "unlawful" prong fails if VPPA fails | Court found statutory UCL standing adequately alleged (economic loss via subscription payments). "Unlawful" prong claim tied to VPPA dismissed with leave to amend; claim based on CLRA may proceed |
| UCL "fraudulent"/"unfair" prongs, CLRA, and unjust enrichment — duty to disclose and pleadings sufficiency | Plaintiffs: Patreon made partial disclosures about data sharing (and even stated it would not share for marketing without consent) but failed to disclose Pixel-driven sharing with Facebook; CLRA and unjust enrichment claims mirror fraudulent theory | Patreon: privacy policies disclosed the categories of sharing and no duty to disclose further; unjust enrichment not a standalone claim under CA law | Court held plaintiffs plausibly alleged a duty arising from partial disclosures and denied dismissal of UCL fraudulent and unfair prongs, CLRA claim, and unjust enrichment claim (court recognizes restitution/unjust enrichment theory at least in quasi-contract form) |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a plausible claim to survive a motion to dismiss)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards require more than labels and conclusions)
- Eichenberger v. ESPN, Inc., 876 F.3d 979 (9th Cir. 2017) (interpreting "personally identifiable information" under VPPA and applying the ordinary-person identifiability test)
- In re Vizio, Inc., Consumer Priv. Litig., 238 F. Supp. 3d 1204 (C.D. Cal. 2017) (test for when a defendant is "engaged in the business" of delivering video content)
- Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988 (9th Cir. 2018) (incorporation-by-reference doctrine and limits on judicial notice of document assertions)
- Branch v. Tunnell, 14 F.3d 449 (9th Cir. 1994) (scope of considering documents outside the complaint on a Rule 12(b)(6) motion)
- Van Patten v. Vertical Fitness Grp., LLC, 847 F.3d 1037 (9th Cir. 2017) (UCL requires loss of money or property for private standing)
- Hinojos v. Kohl’s Corp., 718 F.3d 1098 (9th Cir. 2013) (UCL statutory standing where plaintiff alleges she would not have purchased but for defendant’s misrepresentation)
- ESG Cap. Partners, LP v. Stratos, 828 F.3d 1023 (9th Cir. 2016) (elements of restitution/unjust enrichment under Ninth Circuit framing)
- Astiana v. Hain Celestial Grp., Inc., 783 F.3d 753 (9th Cir. 2015) (discussing the availability/interpretation of unjust enrichment claims under California law)
- Hartford Cas. Ins. Co. v. J.R. Mktg., L.L.C., 61 Cal. 4th 988 (2015) (California Supreme Court recognizing circumstances where unjust enrichment claim can lie)
- Hodsdon v. Mars, Inc., 891 F.3d 857 (9th Cir. 2018) (standards applied to UCL unfair-prong consumer claims)