Whereas French skincare firm L’Occitane (the “Firm”) efficiently thwarted a mass arbitration effort by plaintiffs’ agency Zimmerman Reed and roughly 3,000 clients (the “Claimants”), the Southern District of California Court docket presiding over the matter indicated that the Firm’s case in opposition to them was on the verge of dismissal. L’Occitane v. Zimmerman Reed, et al., No. 2:24-cv-01103 (C.D. Cal. April 15, 2024).
The underlying dispute hinged on an inflow of arbitration claims made by Zimmerman Reed in collaboration with the Claimants in opposition to L’Occitane, all of which alleged that the Firm web site’s use of third-party monitoring software program (e.g., Google Analytics) violated the California Invasion of Privateness Act (CIPA). Shortly after these claims have been made, L’Occitane revoked each teams’ entry to its web sites and filed a criticism in opposition to them in February, alleging, inter alia, that (i) Zimmerman Reed and the Claimants had manufactured the arbitration claims to inflate the group’s measurement in a digital “shakedown” try; and (ii) by persevering with their orchestrated CIPA arbitration shakedown try, that they had additionally violated the federal Pc Fraud and Abuse Act (CFAA).
Notably, L’Occitane highlighted within the criticism the rising development of web site operators being flooded with CIPA claims primarily based on allegations that they have been “wiretapping” their very own web sites due to use of third-party monitoring software program. The development follows a 2022 resolution from the Ninth Circuit discovering that CIPA “applies to Web communications,” and anybody who accessed these communications with out consent might be held liable. Javier v. Assurance IQ, LLC, No. 21-16351 (ninth Cir. Might. 31, 2022).
After the criticism was filed, Zimmerman Reed subsequently sought to compel the matter to arbitration in March. As the premise for his or her movement, they argued that buyers who visited L’Occitane’s web site have been topic to binding arbitration agreements. The Court docket, nevertheless, recognized a essential flaw on this argument in its April resolution: that Zimmerman Reed failed to offer any concrete proof that any of the Claimants had really visited the alleged web site. U.S. District Choose Percy Anderson thus denied the movement to compel arbitration, discovering that, even when he agreed in precept that an arbitration settlement might exist strictly on account of a web site go to, the Claimants had failed to offer any proof of such a go to. However Choose Anderson individually concluded that L’Occitane’s CFAA declare couldn’t survive primarily based on a discovering that the legislation didn’t apply to publicly out there web sites just like the one at situation.
With Zimmerman Reed’s arbitration movement denied and L’Occitane’s CFAA declare dismissed, Choose Anderson queried why the remaining claims mustn’t even be dismissed and requested that the events present trigger for persevering with the lawsuit.
Because the plaintiffs’ bar continues to pursue novel authorized theories beneath privateness statutes like CIPA, firms ought to make sure you collaborate with outdoors counsel to remain updated on new developments and techniques to defend themselves in opposition to such claims, together with, when applicable, happening offense and suing these searching for to pursue frivolous claims. That is very true for firms which will face mass arbitration or class motion techniques from plaintiffs strictly by advantage of their measurement and the mere internet hosting of a web site that generates site visitors.
