Cody v. E. Gluck Corporation

Filing 28

ORDER GRANTING 15 MOTION TO DISMISS.Amended Pleadings due by 10/17/2024. Case Management Statement due by 11/5/2024. Initial Case Management Conference via a Zoom webinar set for 11/15/2024 02:00 PM. Webinar Access : All counsel, members of the public, and media may access the webinar information at https://www.cand.uscourts.gov/hsg General Order 58. Persons granted access to court proceedings held by telephone or videoconference are reminded that photographing, recording, and rebroadcasting of court proceedings, including screenshots or other visual copying of a hearing, is absolutely prohibited.Zoom Guidance and Setup: https://www.cand.uscourts.gov/zoom/. Signed by Judge Haywood S. Gilliam, Jr. on 9/26/2024. (ndr, COURT STAFF) (Filed on 9/26/2024)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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ANNETTE CODY,
Plaintiff,

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v.

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ORDER GRANTING MOTION TO
DISMISS
Re: Dkt. No. 15

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E. GLUCK CORPORATION,
Defendant.

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United States District Court
Northern District of California

Case No. 23-cv-02286-HSG

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Pending before the Court is Defendant E. Gluck Corporation’s motion to dismiss. Dkt.

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No. 15. The Court finds this matter appropriate for disposition without oral argument and the

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matter is deemed submitted. See Civil L.R. 7-1(b). For the reasons detailed below, the Court

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GRANTS the motion.

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I.

BACKGROUND

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Plaintiff Annette Cody brings two causes of action against Defendant E. Gluck

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Corporation for illegal wiretapping under the California Invasion of Privacy Act (“CIPA”), Cal

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Penal Code §§ 631(a) and 632.7. Defendant is a watch manufacturer for several major fashion

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brands. See Dkt. No. 1 (“Compl.”) at ¶ 5. According to the complaint, Defendant operates a

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website for one of its proprietary brands, Armitron, at www.armitron.com. See id.

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(“Introduction”). This website contains a “chat” feature for customers. See id. at ¶¶ 13, 16.

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Plaintiff alleges that Defendant uses software that allows third-party Chantra to intercept and store

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transcripts from these chat communications for use in targeted advertising. See id. at ¶¶ 9, 10, 11–

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14. Plaintiff alleges that Defendant does not obtain users’ consent to share this data. See id. at

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¶ 19.

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//

II.

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In its motion to dismiss, Defendant argues that (1) Plaintiff has not established Article III

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standing to bring her claims; and (2) Plaintiff’s CIPA claims should be dismissed. Dkt. No. 15 at

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12–27.1

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A.

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Defendant first urges that Plaintiff lacks Article III standing because she has not suffered

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Article III Standing

an injury in fact. See Dkt. No. 15 at 12–13.

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i.

Legal Standard

Article III of the Constitution limits the jurisdiction of the federal courts to actual “cases”

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United States District Court
Northern District of California

DISCUSSION

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and “controversies.” U.S. Const. art. III, § 2. One element of this case-or-controversy

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requirement is that the plaintiff must have standing to bring a claim. See Spokeo, Inc. v. Robins,

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578 U.S. 330, 337–38 (2016). To establish standing, a “[p]laintiff must have (1) suffered an injury

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in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely

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to be redressed by a favorable judicial decision.” Id. at 338 (citing Lujan v. Defenders of Wildlife,

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504 U.S. 555, 560–61 (1992)).
To establish injury in fact, a plaintiff must show that she suffered “an invasion of a legally

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protected interest” that is “concrete and particularized” and “actual or imminent, not conjectural or

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hypothetical.” Lujan, 504 U.S. at 560 (quotations omitted). A mere “procedural violation” of a

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statute does not give a plaintiff standing to sue. Rather, she must show that the violation caused

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actual harm. Spokeo, 578 at 342; see also TransUnion LLC v. Ramirez, 594 U.S. 413, 427 (2021)

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(“[A]n injury in law is not an injury in fact.”). “As the party invoking federal jurisdiction, the

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The Court notes that the complaint does not appear to establish personal jurisdiction over
Defendant, which is headquartered in Little Neck, New Jersey, either. See Compl. at ¶ 5.
Defendant’s website appears to be nationally available, and Plaintiff does not allege that
Defendant specifically targets California consumers over any other market. Plaintiff’s allegation
that 8% of Defendant’s sales come from Californians seems to undermine rather than support
Plaintiff’s suggestion that Defendant has purposefully directed its activities to, or purposefully
availed itself of the privilege of conducting activities in, California specifically. See
Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004) (citing three-prong
test to analyze whether court has specific jurisdiction over a non-resident defendant).
Nevertheless, Defendant does not raise this argument and appears to have waived it. See Smith v.
Idaho, 392 F.3d 350, 355 (9th Cir. 2004) (“[I]t is well-recognized that personal jurisdiction—
unlike subject-matter jurisdiction—may be waived.”).
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plaintiffs bear the burden of demonstrating that they have standing.” See TransUnion, 594 U.S. at

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430. The elements of standing “must be supported at each stage of litigation in the same manner

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as any other essential element of the case,” so at the motion to dismiss stage the plaintiff must only

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plausibly allege these elements. Lujan, 504 U.S. at 560–61.

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ii.

Here, Defendant argues that Plaintiff does not have standing to bring her claims because

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she has not alleged that she personally used the chat feature on Defendant’s website. See Dkt. No.

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15 at 12–13. The complaint includes a handful of high-level allegations that Plaintiff suggests are

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relevant to this inquiry. The complaint states:
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“Within the past year, Plaintiff visited Defendant’s Website” while using “a smart
phone.” See Compl. at ¶ 17.

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United States District Court
Northern District of California

Analysis

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“Plaintiff’s conversations with Defendant were transmitted from ‘cellular radio
telephones’ and/or ‘landline telephones’ as defined by CIPA.” See id.

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“Plaintiff and the class members communicated with Defendant using telephony
subject to the mandates and prohibitions of Section 632.7.” See id. at ¶ 34.

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Critically, Plaintiff does not allege that she actually used the chat feature on Defendant’s

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website. Plaintiff argues that the Court can reasonably infer that she used the chat feature as a

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from the above allegations. See Dkt. No. 23 at 4–5. The Court disagrees. Although Plaintiff may

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have communicated with Defendant, see Compl. at ¶ 34, it is not at all clear that this was done

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while using Defendant’s website or through the chat feature that Plaintiff purports to challenge

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here. Neither the Court nor Defendant should have to infer such a fundamental part of her case. If

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Plaintiff in fact used the chat feature as she suggests in her opposition brief, see Dkt. No. 23 at 4, it

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should be simple to amend the complaint accordingly.2

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The Court further cautions Plaintiff’s counsel that they will need to do more than simply assert
that Defendant violated CIPA to allege a concrete injury for purposes of Article III. To be sure, an
intangible invasion of privacy may be sufficient to establish standing, but Plaintiff will need to
provide factual detail, such as the content of her chats with Defendant, to allege an actual privacy
injury. See, e.g., Valenzuela v. Keurig Green Mountain, Inc., No. 3:22-CV-09042-JSC, 2023 WL
6609351, at *2–3 (N.D. Cal. Oct. 10, 2023) (“Without any information as to what Plaintiff told
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CONCLUSION
The Court GRANTS the motion to dismiss. Dkt. No. 15. At this stage in the litigation,

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the Court cannot say that amendment would be futile. Plaintiff may therefore file an amended

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complaint within 21 days of the date of this order.

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The Court further SETS case a case management conference on November 12, 2024, at

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2:00 p.m. The hearing will be held by Public Zoom Webinar. All counsel, members of the public,

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and media may access the webinar information at https://www.cand.uscourts.gov/hsg. The parties

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are further DIRECTED to file a joint case management statement by November 5, 2024.

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United States District Court
Northern District of California

III.

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IT IS SO ORDERED.
Dated: 9/26/2024
______________________________________
HAYWOOD S. GILLIAM, JR.
United States District Judge

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Defendant during the brief chat, Plaintiff has only alleged ‘a bare procedural violation, divorced
from any concrete harm.’”) (quoting Spokeo, 578 U.S. at 341). The Court has “an independent
obligation to determine whether subject-matter jurisdiction exists, even in the absence of a
challenge from any party,” and will carefully evaluate any amended complaint on this point. See
Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006). Plaintiff’s counsel is warned that they need to
fully plead their best case in any amended complaint: it is an inefficient use of everyone’s
resources to dribble out the key allegations over the course of multiple complaints, and there is no
guarantee that the Court will grant further leave to amend.
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