California's Shine the Light Law: A Heightened Pleading Requirement
In three nearly-identical unpublished opinions, the United States Court of Appeals for the Ninth Circuit affirmed the dismissal of three separate class actions brought under California's Shine the Light Law. The Ninth Circuit decisions indicate that to bring a cause of action under the Shine the Light law, plaintiffs must allege more than simply a technical violation of the law. Plaintiffs are required to plead statutory injury by showing that they either submitted a request for information from the defendant or that they would have submitted such a request had accurate contact information been provided. Failure to do so creates a likelihood of a dismissal.
A plaintiff that is injured by a violation of the Shine the Light law may file a civil action to (i) recover damages, (ii) if the court finds willful, intentional or reckless violations of the law, recover a civil penalty, and (iii) obtain an injunction against any business that violates, proposes to violate or has violated the statute.
In all three cases before the Ninth Circuit, the Court held that the plaintiffs lacked standing under the Shine the Light law, because the plaintiffs failed to allege that they submitted a request for information as permitted under the statute, or that they would have submitted such a request had accurate contact information been provided. In reaching its decisions, the Ninth Circuit cited to a recent case in the California Supreme Court, Boorstein v. CBS Interactive, Inc., which requires that "a plaintiff must have made, or attempted to make, a disclosure request in order to have standing under the STL [Shine the Light law]."
In the three cases before the Ninth Circuit, the plaintiffs alleged that they suffered an injury when the companies didn't disclose on their websites information about their third party data sharing practices. Plaintiffs argued that this injury granted them standing to bring suit, whether or not they actually sought out information from the defendants. The Ninth Circuit rejected this argument, and stated that California does not recognize such an informational injury, and added that even if California did recognize such an injury, the plaintiffs failed to state a claim for an informational injury because the plaintiffs' "mere allegations" that the defendants failed to provide contact information "does not pertain to the STL's primary purpose." Therefore, to show statutory injury sufficient to state a claim under the Shine the Light law, plaintiffs must show that they either submitted a request for information from the defendant, or that they would have submitted such a request had accurate contact information been provided.
Although these Ninth Circuit decisions are helpful to defendants, companies should still ensure that they have proper procedures in place for responding to data privacy related requests from customers in a timely fashion. Plaintiffs will learn from these three cases and adjust their pleadings accordingly, assuming the requisite facts exist. Companies should also regularly assess their privacy policies and practices to ensure that they comply with the minimum standards required by state and federal laws and guidelines, as they develop.
1 - King v. Conde Nast Publ'ns, No. 12-57209 (9th Cir. Feb. 18, 2014), available here; Miller v. Hearst Comm'cns Inc., No. 12-57231 (9th Cir. Feb. 18, 2014), available here; Baxter v. Rodale, Inc., No. 12-56925 (9th Cir. Feb. 21, 2014), available here.
2 - Cal. Civ. Code §§ 1798.83-1798.84.
3 - Id. at § 1798.83(a).
4 - Id. at §§ 1798.83(b)(1)(A)-(C).
5 - Id. at § 1798.83(c)(2).
6 - Id.
7 - Id. at §§ 1798.84(b), (c), (e).
8 - King, No. 12-57209 at 3; Miller, No. 12-57231 at 3; Baxter, No. 12-56925 at 3.
9 - 165 Cal. Rptr. 3d 669, 673 (Cal. Ct. App. 2013).
10 - See, First Amended Class Action Complaint, King v. Conde Nast Publ'ns, 12-cv-00719-GHK-E (C.D. Cal. Aug. 17, 2012), ECF No. 31; First Amended Class Action Complaint, Miller v. Hearst Comm'cns Inc., 12-cv-00733-GHK-PLA (C.D. Cal. Aug. 16, 2012), ECF No. 35; Complaint, Baxter v. Rodale, Inc., 12-cv-00585-GAF-AGR (C.D. Cal. Jan. 23, 2012), ECF 1.
11 - Id.
12 - King, No. 12-57209 at 4 n.1; Miller, No. 12-57231 at 4 n.1; Baxter, No. 12-56925 at 4 n.1.
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