E.K.D. et al v. Facebook, Inc.
Filing
28
EXHIBIT by Facebook, Inc.. Exhibit to 27 Motion to Stay Declaration of Matthew D. Brown In Support Of Motion To Stay Proceedings Pending Ruling By Mdl Panel On Motion To Transfer. (Attachments: # 1 Exhibit A to Brown Declaration, # 2 Exhibit B to Brown Declaration)(Brown, Matthew)
EXHIBIT B
Case MDL No. 2288 Document 25 Filed 08/30/11 Page 1 of 20
BEFORE THE UNITED STATES JUDICIAL PANEL
ON MULTIDISTRICT LITIGATION
IN RE FACEBOOK USE OF NAME AND
LIKENESS LITIGATION
MDL DOCKET NO. 2288
FACEBOOK, INC.’S CONSOLIDATED REPLY IN SUPPORT OF ITS
MOTION FOR TRANSFER OF RELATED ACTIONS TO THE
NORTHERN DISTRICT OF CALIFORNIA PURSUANT TO 28 U.S.C. § 1407
Case MDL No. 2288 Document 25 Filed 08/30/11 Page 2 of 20
TABLE OF CONTENTS
PAGE
I.
INTRODUCTION ............................................................................................................. 1
II.
ARGUMENT..................................................................................................................... 2
A.
B.
Transfer Will Still Serve the Convenience of the Parties and the
Witnesses. .............................................................................................................. 7
C.
Transfer Will Still Promote the Just and Efficient Conduct of These
Actions. ................................................................................................................ 11
D.
III.
The Actions Still Involve Common Questions of Fact.......................................... 2
Transfer to the Northern District of California Would Best Fulfill the
Goals of Section 1407.......................................................................................... 13
CONCLUSION................................................................................................................ 16
Case MDL No. 2288 Document 25 Filed 08/30/11 Page 3 of 20
TABLE OF AUTHORITIES
PAGE(S)
Cases
Carafano v. Metrosplash.com, Inc.,
339 F.3d 1119 (9th Cir. 2003) .................................................................................................... 5
Cohen v. Facebook, Inc.,
No. 10-cv-05282 (N.D. Cal.) ............................................................................................. passim
Dawes v. Facebook, Inc.,
No. 11-cv-00461 (S.D. Ill.)................................................................................................ passim
Downey v. Facebook, Inc.,
No. 11-cv-03287 (N.D. Cal.) ........................................................................................ 1, 2, 7, 15
Fraley v. Facebook, Inc.,
No. 11-cv-01726 (N.D. Cal.) ............................................................................................. passim
In re Camp Lejeune, N.C. Water Contamination Litig.,
763 F. Supp. 2d 1381 (J.P.M.L. 2011)...................................................................................... 13
In re CBS Licensing Antitrust Litig.,
328 F. Supp. 511 (J.P.M.L. 1971)............................................................................................. 12
In re Conseco Life Ins. Co. Lifetrend Ins. Mktg. & Sales Practices Litig.,
672 F. Supp. 2d 1372 (J.P.M.L. 2010)...................................................................................... 11
In re Countrywide Financial Corp. Mortgage-Backed Sec. Litig.,
MDL No. 2265, 2011 WL 3569969, at *2-3 (J.P.M.L. Aug. 15, 2011) ................................... 14
In re DeepWater Horizon,
764 F. Supp. 2d 1352, n.1 (J.P.M.L. 2011)................................................................................. 5
In re Eastern Airlines, Inc. Flight Attendant Weight Program,
391 F. Supp. 763 (J.P.M.L. 1973)............................................................................................... 6
In re Federal Home Loan Mortg. Corp. (Freddie Mac) Secs. Litig.,
643 F. Supp. 2d 1378 (J.P.M.L. 2009)...................................................................................... 11
In re Int’l House of Pancakes Franchise Litig.,
331 F. Supp. 556 (J.P.M.L. 1971)............................................................................................. 14
In re Kaplan Higher Educ. Corp. Qui Tam Litig.,
626 F. Supp. 2d 1323 (J.P.M.L. 2009)...................................................................................... 13
In re Lead Contaminated Fruit Juice Prods. Mktg. & Sales Practices Litig.,
MDL No. 2231, --- F. Supp. 2d ---, 2011 WL 1466934 (J.P.M.L. Apr. 19, 2011) .................. 12
In re Park W. Galleries, Inc., Mktg. & Sales Practices Litig.,
645 F. Supp. 2d 1358 (J.P.M.L. 2009)...................................................................................... 14
In re Progressive Corp. Ins. Underwriting & Rating Practices Litig.,
259 F. Supp. 2d 1370 (J.P.M.L. 2003)...................................................................................... 14
In re Regions Bank ATM Fee Notice Litig.,
763 F. Supp. 2d 1372 (J.P.M.L. 2011)...................................................................................... 11
In re Student-Athlete Name & Likeness Litigation,
763 F. Supp. 2d 1379 (J.P.M.L. 2011)...................................................................................... 12
Lou v. Belzburg,
834 F.2d 730 (9th Cir. 1987) .................................................................................................... 11
Nastro v. Facebook, Inc.,
No. 11-cv-2128 (E.D.N.Y.) .......................................................................................... 1, 2, 7, 15
Case MDL No. 2288 Document 25 Filed 08/30/11 Page 4 of 20
TABLE OF AUTHORITIES
(CONTINUED)
PAGE(S)
Swanson v. Badger Mutual Insurance Co.,
275 F. Supp. 544 (S.D. Ill. 1967).............................................................................................. 10
Vanderweit v. Facebook, Inc.,
No. 11-cv-05305 (C.D. Cal.) ...................................................................................................... 1
Statutes
15 U.S.C. § 6501............................................................................................................................. 3
15 U.S.C. § 6508............................................................................................................................. 3
28 U.S.C. Section 1407.......................................................................................................... passim
47 U.S.C. § 230........................................................................................................................... 3, 5
Civil Code Section 3344 ......................................................................................................... 3, 5, 7
Rule 30(b)(6)................................................................................................................................... 9
iii
Case MDL No. 2288 Document 25 Filed 08/30/11 Page 5 of 20
Defendant Facebook, Inc. (“Facebook”) respectfully submits this Reply in support of its
Motion for Transfer of Related Actions to the Northern District of California Pursuant to 28
U.S.C. Section 1407 (the “Motion”). Facebook seeks an order from the Judicial Panel on
Multidistrict Litigation (the “Panel”) transferring three actions (the “Actions”)1 to a single
Northern District of California judge to facilitate effective and efficient pretrial coordination
and/or consolidation.
I.
INTRODUCTION
Apparently in response to Facebook’s Motion, plaintiffs in two of the five actions that
Facebook originally identified in its Schedule of Actions voluntarily dismissed their claims.
Now, based on the dismissal of those two actions—Nastro v. Facebook, Inc., No. 11-cv-2128
(E.D.N.Y.) (“Nastro”), and Downey v. Facebook, Inc., No. 11-cv-03287 (N.D. Cal.)
(“Downey”)2—Plaintiffs in the remaining Actions argue the Motion must be denied. To the
contrary, the Actions still involve common questions of fact and law, and transfer will still serve
the convenience of the parties and witnesses and promote the just and efficient conduct of the
1
The Actions are: (1) Cohen v. Facebook, Inc., No. 10-cv-05282 (N.D. Cal.) (“Cohen”), pending
before the Honorable Richard Seeborg; (2) Fraley v. Facebook, Inc., No. 11-cv-01726 (N.D.
Cal.) (“Fraley”), pending before the Honorable Lucy H. Koh; and (3) Dawes v. Facebook, Inc.,
No. 11-cv-00461 (S.D. Ill.) (“Dawes”), pending before the Honorable G. Patrick Murphy.
2
Facebook filed its Motion before this Panel on August 1, 2011. On August 4, 2011, counsel for
the Nastro plaintiffs filed a notice of voluntary dismissal of that action. (Notification of
Developments (Dkt. No. 6).) The case was closed the same day. (See id.) On August 19, 2011,
counsel for the Downey plaintiffs filed a notice of voluntary dismissal of that action. (See
Notification of Developments (Dkt. No. 18).) Plaintiffs in Downey were represented by the same
counsel who represented plaintiffs in Nastro. (See Brief in Support of Defendant Facebook,
Inc.’s Motion (Dkt. No. 1) (the “Opening Brief”) at 7-8.)
As noted in Facebook’s Opening Brief, on June 24, 2011, other plaintiffs filed a class action in
the Central District of California alleging violation of their rights of publicity based on “social
ads” appearing on Facebook. That case, styled Vanderweit v. Facebook, Inc., No. 11-cv-05305
(C.D. Cal.), was filed by the same counsel representing plaintiffs in the David Cohen action
pending in California state court. (Opening Br. at 14.) On June 30, 2011, counsel for the
Vanderweit plaintiffs voluntarily dismissed their action.
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 6 of 20
Actions. Transfer of the Actions to a single judge in the Northern District of California for
pretrial coordination or consolidation is therefore still appropriate under 28 U.S.C. Section 1407.
Plaintiffs make a number of arguments directed at the merits of Facebook’s Motion. For
the reasons explained below, each of those arguments lacks merit. To deflect the Panel’s
attention from the key issues, Plaintiffs also make the inflammatory accusation that Facebook
filed this Motion before the Panel to engage in forum shopping. The record does not support
Plaintiffs’ claim: Facebook filed the Motion only after four new class actions alleging similar
claims were filed within a nine-week period. Facebook timely disclosed its consideration of the
option to seek multidistrict coordination of the Actions to the judge presiding over the Fraley
and Downey actions (the Honorable Lucy Koh). And Facebook provided timely notice to the
Panel of the dismissal of the Nastro and Dawes actions. If anything, the filing of overlapping
actions in jurisdictions across the country, followed by the strategic dismissal of certain actions
and not others, suggests that plaintiffs’ counsel has engaged in forum shopping. Accordingly,
the Panel should reject Plaintiffs’ baseless accusations.
II.
ARGUMENT
Despite plaintiffs’ voluntary dismissal of the Nastro and Downey actions, transfer of the
Actions to a single judge in the Northern District of California is still appropriate under 28
U.S.C. Section 1407. Transfer of actions is appropriate under Section 1407 when: (i) the actions
“involv[e] one or more common questions of fact;” (ii) the transfer would “be for the
convenience of parties and witnesses;” and (iii) the transfer “will promote the just and efficient
conduct” of the actions. Those elements are satisfied here.
A.
The Actions Still Involve Common Questions of Fact.
The Actions still involve common questions of fact, despite the dismissal of the Nastro
and Downey actions. The core allegation of each Action is that Facebook misappropriated the
names and likenesses of plaintiffs and other Facebook users (“Users”) in the putative class by
displaying them, without consent, alongside content that plaintiffs allege to be advertising. (See
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Opening Br. at 4-11.) Each Action either alleges violations of California’s Civil Code Section
3344 (“Section 3344”) (see Opening Br. at 4-5 (Cohen and Fraley complaints)) or references that
statute along with other, similar “state law” (see Decl. of Matthew D. Brown, filed with
Facebook’s Motion, Ex. 4 (hereafter, “Dawes complaint”) ¶ 20). Facebook still denies these
allegations, still denies that any of the Actions should be certified as a class action, and still
asserts numerous defenses, including that the plaintiffs have suffered no cognizable injury, that
they consented to the conduct they now challenge, and/or that the plaintiffs’ claims are precluded
or preempted by the federal Communications Decency Act (47 U.S.C. § 230) (the “CDA”)
and/or the Children’s Online Privacy Protection Act (15 U.S.C. §§ 6501-08)—all of which
presents additional common questions. (See Opening Br. at 10-11.)
Plaintiffs attempt to obfuscate these obvious similarities, but their attempts should fail.
For example, the Dawes plaintiffs describe their own allegations as “relate[d] specifically to
Facebook’s misappropriation of minors’ names and likenesses in connection with Facebook’s
‘targeted’ or ‘enhanced’ advertisements displayed to other Facebook users.” (Pl. E.K.D.’s Resp.
in Opp. to Facebook’s Mot. for Transfer and Coordination or Consolidation Under 28 U.S.C. §
1407 (Dkt. No. 17) (“Dawes Opp.”) at 5.) But the Dawes class definition does not appear to be
so limited. As the Dawes plaintiffs explain in their Opposition, they “assert claims on behalf of a
nationwide class of Facebook users ‘who during a time that facebook records identified them to
be under the age of 18, had their names and likenesses used in connection with a facebook
advertisement.’” (Id. (emphasis added).)
The Dawes plaintiffs then attempt to distinguish the Cohen action as not “assert[ing]
claims specific to . . . Facebook’s advertising.” (Id. at 6.) But that is simply incorrect: the Cohen
complaint plainly alleges that Facebook Users’ names and likenesses are used in advertisements
for the “friend finder” service. (See, e.g., Decl. of Matthew D. Brown, filed with Facebook’s
Motion, Ex. 1 Preamble (“Plaintiffs . . . file this First Amended Class Action Complaint
individually and on behalf of all other similarly situated residents of the United States whose
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 8 of 20
names, images, and/or or likenesses have been used . . . to advertise and/or promote Facebook’s
‘Friend Finder’ service.” (emphasis added)); id. ¶¶ 35-43 (alleging that Facebook
misappropriated Users’ names and likenesses by displaying them to promote its friend finder
utility); id. ¶ 44 (alleging putative nationwide class of “[a]ll Facebook users whose names,
photographs or digital images and/or likenesses have been used without consent or compensation
on Facebook.com for the purpose of advertising Facebook’s Friend Finder service . . . .”).)
Similarly, the Dawes plaintiffs attempt to distinguish the Fraley allegations as “limited to
a particular Facebook service or activity – ‘Sponsored Stories.’” (Dawes Opp. at 8.) But, once
again, a central allegation of the Fraley complaint is that “Sponsored Stories” are
advertisements. (See Opening Br. at 5 (quoting Fraley complaint ¶ 95) (Fraley complaint alleges
a class who “had their names, photographs, likenesses or identities associated with that account
used in a Facebook Sponsored Story advertisement” (emphasis added).) In fact, the Fraley
plaintiffs describe “[a] Sponsored Story [as] simply a paid advertisement” in their Opposition.
(Br. in Support of Fraley Plaintiffs’ Opp. to Mot. for Transfer (Dkt. No. 19) (“Fraley Opp.”) at 6
(emphasis added).) Similar arguments made by the Fraley plaintiffs (see id. at 8-11) are
unavailing for the same reasons.3
The Dawes and Cohen plaintiffs also attempt to distinguish the Dawes and Fraley actions
because the Fraley claims are “not tied to the age of the user nor Facebook’s failure to obtain the
consent of minor users’ parents or guardians.” (Dawes Opp. at 7; see Pls.’ Statement in Resp. to
Facebook, Inc.’s Mot. to Transfer (Dkt. No. 22) (“Cohen Opp.”) at 4-5.) But the Fraley
plaintiffs themselves admit the issue of minor consent is an “aspect” of the Fraley action.
(Fraley Opp. at 13.) In fact, they state in their Opposition:
The theory of the Fraley case with respect to the minor subclass
(and the entire basis of the Dawes case) is that the members of the
Minor Subclass cannot have consented to having their names and
likenesses in ads, only their legal guardian can.
3
Although the Fraley plaintiffs attempt to minimize overlap among the cases, they concede
seven times that the cases overlap. (See Fraley Opp. at 1, 2, 9, 10, 11 (twice), 13.)
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 9 of 20
(Id. at 14.) Indeed, although each plaintiff attempts to minimize the obvious overlap between the
Fraley and Dawes class definitions, describing the overlap as “limited” (Dawes Opp. at 8; Fraley
Opp. at 9-11) or lacking meaning (Cohen Opp. at 4), each acknowledges that the overlap exists
(Dawes Opp. at 8; Fraley Opp. at 1, 2, 9, 10, 11, 13; Cohen Opp. at 4).
The Dawes plaintiffs attempt to further obfuscate the similarities among the Actions by
arguing that each Action raises distinct legal issues that the other Actions do not raise. (See
Dawes Opp. at 5-8; see also Cohen Opp. at 4-5.) But, as explained in the Opening Brief, the
existence of variations among the Actions does not defeat centralization where there exists a core
of allegations amenable to resolution in a coordinated fashion. (See Opening Br. at 11.) Further,
the few differences the Dawes plaintiffs do identify are red herrings. For example, the Dawes
plaintiffs find the existence of claims under California’s Unfair Competition Law (the “UCL”) in
Cohen and Fraley but not Dawes significant. (See Dawes Opp. at 7-8.) However, as the Fraley
plaintiffs acknowledge, “[t]he UCL claim in part piggybacks upon the Civil Code Section 3344
claim.” (See Fraley Opp. at 17.) Although the Dawes complaint does not appear to state a cause
of action under any specific statute (see Dawes compl. ¶¶ 36-41), and rather cryptically states
that Facebook’s actions violate “State law” (id. Prayer for Relief), the complaint does reference
Section 3344 along with other, similar “state law” (id. ¶ 20). The Dawes plaintiffs also seek to
distinguish their action from the Fraley and Cohen actions by asking this Court to find that 47
U.S.C. Section 230 (“CDA 230”), a section of the federal Communications Decency Act that
grants broad immunity to websites such as Facebook, does not apply to their misappropriation
claims. (See Dawes Opp. at 6.) But circuit court authority, which the Dawes plaintiffs
conveniently do not cite, has squarely held misappropriation claims to be preempted by CDA
230, see Carafano v. Metrosplash.com, Inc., 339 F.3d 1119, 1125 (9th Cir. 2003), and Section
1407 does not authorize the Panel to assess the Dawes plaintiffs’ claim on its merits, see In re
DeepWater Horizon, 764 F. Supp. 2d 1352, 1353 n.1 (J.P.M.L. 2011).
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 10 of 20
The Fraley plaintiffs argue that Facebook’s CDA 230 defense argument does not provide
a basis for transfer. (Fraley Opp. at 16, 18.) They cite to In re Eastern Airlines, Inc. Flight
Attendant Weight Program, 391 F. Supp. 763, 764 (J.P.M.L. 1973), for the proposition that
“where the commonality between or among actions rests solely on questions of law, transfer
under Section 1407 would be inappropriate.” (Fraley Opp. at 16 (brackets and emphasis
omitted).) But the Fraley citation is incomplete, as Eastern Airlines went on to hold that transfer
was warranted because the defense asserted in that case “raise[d] many factual issues common to
both actions.” 391 F. Supp. at 764. The Fraley plaintiffs’ arguments regarding CDA 230 show
that, if the cases were to proceed beyond the motion to dismiss stage, the CDA 230 defense will
raise just these kinds of common factual questions. The Fraley plaintiffs explain that they will
argue that CDA 230 does not apply because Facebook does not simply publish “information
posted by third party information content providers,” but rather “that Facebook has created new
and original content—the advertisements in question . . . .” (Fraley Opp. at 18.) Facebook, in
contrast, argues that it is republishing information content provided by others, and that its actions
are well within the range of editorial discretion that CDA 230 allows, and therefore that
Facebook is entitled to immunity under CDA 230. As can be seen from the parties’ arguments,
if the complaints are allowed to proceed beyond the motion to dismiss stage, resolving this legal
question will likely require resolution of common factual questions.
Finally, the Fraley and Cohen plaintiffs argue that Facebook’s failure to use
administrative procedures within the Northern District of California to relate the Fraley and
Cohen actions demonstrates that Facebook does not believe the two actions are related. (See
Fraley Opp. at 2; Cohen Opp. at 3.) Facebook has not taken the position that the Fraley and
Cohen actions are related on their own. That is, Facebook has not advocated that those two
cases, standing alone, would need to be heard by a single judge. However, if Dawes and Fraley
are transferred to a single judge for coordinated or consolidated treatment (which Facebook
strongly urges, as set forth in its Opening Brief and this Reply), a single judge should preside
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 11 of 20
over Cohen as well. Since the filings of the Nastro, Dawes, and Downey actions, it has become
clear that Fraley and Cohen are two points on the continuum of cases in which the courts will be
asked to consider whether and how Facebook’s display of Users’ names and profile pictures in
connection with their activity on the site implicates Users’ rights of publicity and other state
laws. If one judge is tasked with working through, for multiple named plaintiffs and their
associated putative nationwide classes, the complex issues of standing/injury, application of
Section 3344 to Facebook’s use of Users’ names and likenesses on Facebook.com, etc., then the
same judge should also be ruling on those same issues in Cohen to avoid the risk of inconsistent
rulings. Moreover, unlike in Fraley, where the theory of injury appears to be limited to
Sponsored Stories, it is not clear what theory the Dawes plaintiffs will advance, other than
alleged improper conduct concerning Facebook “advertisements.” The Dawes plaintiffs may
also consider the “friend finder” suggestions published by Facebook to be within the ambit of
challenged “advertisements,” just as the Cohen plaintiffs themselves claim that those suggestions
are advertisements.
The Actions raise the same core factual allegations and implicate similar questions of
law. Plaintiffs have failed to show otherwise. Therefore, transfer of the Actions to a single
Northern District of California judge is appropriate under Section 1407.
B.
Transfer Will Still Serve the Convenience of the Parties and the Witnesses.
Because the Actions rely upon similar factual allegations and present similar legal
questions, the discovery the parties seek in each Action is likely to overlap with the discovery
sought in the other Actions. Pretrial coordination is therefore still essential to minimize the
immense burden that Facebook would face in responding to three different sets of substantively
similar and substantially overlapping but non-identical discovery. (See Opening Br. at 11-12.)
Plaintiffs in Fraley argue that centralization of the Actions is unlikely to lead to
efficiencies related to discovery. (Fraley Opp. at 2, 8-14; see also Dawes Opp. at 6.) For
example, the Fraley plaintiffs argue that there will be little need for depositions related to the
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 12 of 20
issue of consent because most of the information related to that issue is publicly available.
(Fraley Opp. at 2.) However, both the Fraley and Cohen plaintiffs have served “person most
knowledgeable” deposition notices targeted at the issue of consent. For example, the Cohen
plaintiffs have requested depositions related to:
26.
The manner(s) in which YOU believe USERS have
consented to placement of their names and likenesses next to
statements encouraging use of FRIEND FINDER.
27.
Whether and how YOUR privacy settings permit USERS to
give or withdraw consent to placement of their names and
likenesses next to statements encouraging the use of FRIEND
FINDER.
(See Decl. of Matthew D. Brown, filed herewith (“Brown Decl.”), ¶ 2.) Directly contradicting
the Fraley plaintiffs’ argument that “the consent issue is not likely to be a driver as far as
discovery” (Fraley Opp. at 14), the Fraley plaintiffs have served Facebook with fifteen
deposition topics arguably related to consent, including, among others:
5.
PMK REGARDING how Facebook obtained members’
consent to individual Facebook SPONSORED STORIES.
7.
PMK REGARDING how Facebook makes members aware
of SPONSORED STORIES.
10.
PMK REGARDING whether MEMBERS should re-affirm
consent to the TERMS before appearing in SPONSORED
STORIES.
43.
PMK REGARDING Facebook terms that comprise the
complete agreement between Facebook and members from [sic]
including changes from January 2011 to present.
47.
PMK REGARDING the Terms of Use for Facebook
members as those terms pertain to SPONSORED STORIES.
48.
PMK REGARDING the Statement of Rights and
Responsibilities for Facebook members as those terms pertain to
SPONSORED STORIES.
49.
PMK REGARDING the Facebook’s [sic] Privacy Policy as
it pertains to SPONSORED STORIES.
50.
PMK REGARDING the content of the Facebook Help
Center as it pertains to SPONSORED STORIES.
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 13 of 20
(See Brown Decl. ¶ 5.)
The agreements between Facebook and its Users, the content of Facebook’s website
terms and Help Center, and other mechanisms for providing consent will each have significant
overlap in how they apply to the “friend finder” service or “Sponsored Stories” or “social ads”
despite the happenstance of how that discovery is propounded. The same is likely to be true if
the propounded discovery seeks information related to teenagers’ use of Facebook, technical
information regarding how Facebook displays Users’ names and likenesses, or any of the other
common factual issues that exist among the Actions.4
Perhaps recognizing that there will be significant overlap in discovery between the three
Actions, plaintiffs claim that they could coordinate that discovery in order to create the
efficiencies that would otherwise be provided by centralization. (Dawes Opp. at 8-11; Fraley
Opp. at 15-16; Cohen Opp. at 7-8.) But this promise of voluntary coordination rings hollow.
The first Facebook heard of plaintiffs’ suggestion was in their briefing before the Panel, even
though Facebook has had substantial meet-and-confer conferences regarding discovery with
counsel in both the Cohen and Fraley action since the filing of the Motion. (Brown Decl. ¶¶ 3,
5.) And far from trying to coordinate discovery, the separate plaintiffs’ counsel have plowed
ahead with their own individual discovery, which is now well underway, with no attempt at
coordination whatsoever. In the Cohen action, Facebook has responded to 85 requests for
production and 13 interrogatories. (Id. ¶ 3.) After meeting with counsel for the Cohen plaintiffs,
Facebook agreed to provide amended responses to 9 requests for production and 13
interrogatories in early September, to begin producing documents in September, and to hold Rule
30(b)(6) depositions in October. (Id. ¶ 3.) In the Fraley action, Facebook has responded to 63
requests for production, 52 requests for admission, and 15 interrogatories. (Id. ¶ 6.) The Fraley
4
To the extent consent is not found as a matter of law under Facebook’s terms of service, which
it should be, whether a User consented to Facebook’s use of his or her name or profile picture
could be a question individual to each class member. In any event, the discovery served relating
to this issue will overlap and should be coordinated to maximize efficiency.
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 14 of 20
plaintiffs have also noticed Rule 30(b)(6) depositions of Facebook on 40 topics on five days in
September. (Id. ¶ 5.)
Centralization of the Actions before a single judge in California, where Facebook and
nine of the twelve named plaintiffs reside5 (see Opening Br. at 4-8), will also minimize the
burdens on the parties whenever court appearances are required. As explained in the Opening
Brief, transfer to the Northern District would maximize the convenience of all the parties
because Facebook, and likely all of its witnesses and documents, are located there. (Id. at 15.)
The Dawes plaintiffs argue that the Panel should not change their selected venue because
the Dawes action involves minors. (See Dawes Opp. at 11.) But this should pose no obstacle to
transferring Dawes. First, Facebook is willing to stipulate to deposing the Dawes plaintiffs near
their homes in the Southern District of Illinois should the Panel decide to centralize the Actions.
The Dawes plaintiffs’ alleged concerns about the time and expense of having to travel to another
jurisdiction, therefore, should have minimal impact on the Motion.6 Second, the case the Dawes
plaintiffs cite in support of their argument, Swanson v. Badger Mutual Insurance Co., is readily
distinguishable, because it involves an individual personal injury action in which the minor
plaintiff was undergoing treatment in the transferor forum. See 275 F. Supp. 544, 546-47 (S.D.
Ill. 1967). Those are clearly not the facts here: plaintiffs bring claims on behalf of themselves
and a putative nationwide class alleging that a free website available throughout the United
States misappropriated their names and likenesses without consent. Finally, plaintiffs in class
actions are entitled to little, if any, deference in their choice of forum, especially when they
allege a nationwide class, as the Dawes plaintiffs do, and pledge to “vigorously protect” the
rights of putative class members residing in other states. (Dawes Compl. ¶ 26.) See Lou v.
5
A tenth plaintiff has signaled her preference for the Northern District of California by bringing
her claim there, even though she resides outside of California. (Opening Br. at 5-6.)
6
The Dawes plaintiffs also argue that their guardians will be unable to supervise the Dawes
action if it is transferred to the Northern District of California. (Dawes Opp. at 11.) But, as the
Dawes plaintiffs say themselves in the very same paragraph, “there is usually no need for the
parties . . . to travel for depositions or otherwise during pre-trial proceedings.” (Id. at 11-12.)
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 15 of 20
Belzburg, 834 F.2d 730, 739 (9th Cir. 1987) (“Although great weight is generally accorded
plaintiff’s choice of forum, when an individual brings a derivative suit or represents a class, the
named plaintiff’s choice of forum is given less weight.” (internal citations omitted)).
For these reasons, transfer of the Actions will serve the convenience of the parties, the
witnesses, and counsel throughout the pretrial proceedings.
C.
Transfer Will Still Promote the Just and Efficient Conduct of These Actions.
Transfer of the Actions will still promote the interests of judicial economy and fairness.
For the reasons stated above and in the Opening Brief, transfer will prevent duplicative discovery
in the Actions. (See supra § II(B); Opening Br. at 11-15.) Transfer will also prevent the risk of
duplicative and potentially conflicting pretrial motion practice. (See Opening Br. at 13-15.)
Plaintiffs raise several arguments alleging that transfer will not provide these efficiencies, but
each of their arguments lacks merit.
First, plaintiffs argue that the three actions are too few and insufficiently complex to
justify transfer under Section 1407. (Dawes Opp. at 4; Fraley Opp. at 15; Cohen Opp. at 2-6.)
However, the Panel often grants motions to transfer that identify three actions, especially where,
as here, there are clear efficiencies to be gained from transfer because of the common questions
raised by the actions. See, e.g., In re Regions Bank ATM Fee Notice Litig., 763 F. Supp. 2d
1372, 1372 (J.P.M.L. 2011) (transferring three actions involving common questions related to
the operation of a bank’s automatic teller machines); In re Conseco Life Ins. Co. Lifetrend Ins.
Mktg. & Sales Practices Litig., 672 F. Supp. 2d 1372, 1372-73 (J.P.M.L. 2010) (transferring
three actions involving common questions related to insurance policy premiums); In re Federal
Home Loan Mortg. Corp. (Freddie Mac) Sec. Litig., 643 F. Supp. 2d 1378, 1380 (J.P.M.L. 2009)
(transferring three actions pending in two districts involving common questions related to the
undercapitalization of Freddie Mac). As explained in the Opening Brief and above, the Actions
raise common factual and legal issues and will involve overlapping discovery on behalf of
putative nationwide classes of tens, if not hundreds, of millions of Facebook Users (see Opening
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Br. at 11-13; supra §§ II(A), (B)), the consideration of which will lead to “substantial savings of
time and effort for court and counsel” see In re CBS Licensing Antitrust Litig., 328 F. Supp. 511,
512 (J.P.M.L. 1971).
Second, plaintiffs cite to In re Student-Athlete Name & Likeness Litigation, 763 F. Supp.
2d 1379 (J.P.M.L. 2011), apparently in the belief that it supports an argument that actions
alleging right of publicity claims are insufficiently complex to benefit from transfer by the Panel.
(See Dawes Opp. at 4; Fraley Opp. at 15; Cohen Opp. at 4.) Plaintiffs misrepresent StudentAthlete. In fact, the movant in Student-Athlete sought an order centralizing actions alleging two
different types of claims—one group of plaintiffs alleged right of publicity claims, the other
alleged violations of various antitrust laws. See Student-Athlete, 763 F. Supp. 2d at 1379.
Electronic Arts, the only defendant common to the actions being considered for consolidation,
opposed transfer because it “believe[d] that centralization would be disruptive to the efficient
conduct of each action with little overall benefit.” See id. at 1380. In other words, Electronic
Arts opposed transfer because the differing legal claims meant there would be few to no judicial
efficiencies arising from centralization. Unsurprisingly, the Panel agreed. See id. StudentAthlete has little to say about the centralization of the Actions here, which Facebook favors
rather than opposes, and where each of the Actions makes similar allegations that Facebook
misappropriated Facebook Users’ names and likenesses on its website.
Third, the Fraley plaintiffs argue that the Motion is “premature” because pending
motions to dismiss may resolve the other actions (but not their action), thereby eliminating the
multidistrict character of the Motion. (Fraley Opp. at 1, 8.) However, the Fraley plaintiffs
misapprehend Panel precedent, as one of the purposes of 28 U.S.C. Section 1407 is to prevent
inconsistent rulings on pretrial motions, including motions to dismiss. See, e.g., In re Lead
Contaminated Fruit Juice Prods. Mktg. & Sales Practices Litig., MDL No. 2231, --- F. Supp. 2d
---, 2011 WL 1466934 (J.P.M.L. Apr. 19, 2011) (granting transfer under Section 1407
specifically in order to prevent inconsistent rulings on defendants’ motions to dismiss). As the
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 17 of 20
Panel explained just this February, in another action where a party suggested that an order
transferring cases pursuant to Section 1407 was premature because of pending motions to
dismiss: “We decline to delay centralization, as it only invites inconsistent rulings, a result that
Section 1407 is designed to avoid.” In re Camp Lejeune, N.C. Water Contamination Litig., 763
F. Supp. 2d 1381, 1382 (J.P.M.L. 2011); see also In re Kaplan Higher Educ. Corp. Qui Tam
Litig., 626 F. Supp. 2d 1323, 1324 (J.P.M.L. 2009) (noting that transfer under Section 1407
ensures coordination of pretrial proceedings, including motions to dismiss). Indeed, the
prevention of inconsistent rulings on Facebook’s motions to dismiss is actually another ground
for transfer of the Actions to a single forum.
Concerns of efficiency and fairness therefore still weigh strongly in favor of transfer.
D.
Transfer to the Northern District of California Would Best Fulfill the Goals
of Section 1407.
The Northern District of California is still the most appropriate forum for pretrial
proceedings. Two of the three Actions are already pending there (including the first- and
second-filed Actions) and, as explained above and in Facebook’s Opening Brief, transfer to the
Northern District of California would maximize the convenience of all the parties because
Facebook’s headquarters, and likely all of its witnesses and documents, are located there. (See
Opening Br. at 15; supra § II(B).) Transfer to the Northern District of California is also still
appropriate for the reasons set forth in Facebook’s Opening Brief. (Opening Br. at 15-18.)
Plaintiffs in Fraley agree that the Northern District of California is the most appropriate forum,
should the Panel issue an order transferring the Actions. (Fraley Opp. at 19.)
Plaintiffs in the Actions accuse Facebook of forum shopping in recommending that the
Panel transfer the Actions to Judge Seeborg. (Dawes Opp. at 2-3; Fraley Opp. at 2; Cohen Opp.
at 6-7.) In truth, as Facebook noted in its Opening Brief, “Facebook believes that any judge in
the Northern District of California would be an appropriate choice to preside over the pretrial
coordination or consolidation of the Actions.” (Opening Br. at 17 (emphasis added).) In
recommending Judge Seeborg, Facebook was following the Panel’s precedent. The Panel often
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 18 of 20
transfers actions for pretrial proceedings to the judge overseeing the first-filed and most
advanced action. See, e.g., In re Countrywide Financial Corp. Mortgage-Backed Sec. Litig.,
MDL No. 2265, 2011 WL 3569969, at *2-3 (J.P.M.L. Aug. 15, 2011) (transferring litigation in
order to “take advantage of [a judge’s] familiarity with the issues in this litigation and make
efficient use of judicial resources”); In re Park W. Galleries, Inc., Mktg. & Sales Practices Litig.,
645 F. Supp. 2d 1358, 1360 (J.P.M.L. 2009) (transferring litigation to district where “action is
measurably more advanced”); In re Progressive Corp. Ins. Underwriting & Rating Practices
Litig., 259 F. Supp. 2d 1370, 1371 (J.P.M.L. 2003) (noting that most experienced judge stood out
as potential transferee); In re Int’l House of Pancakes Franchise Litig., 331 F. Supp. 556, 558
(J.P.M.L. 1971) (transferring litigation to judge with experience in the litigation, including
hearing arguments on dispositive motions). As Facebook explained in its Motion, Judge Seeborg
has already decided a motion to dismiss in Cohen, and briefing on Facebook’s second motion to
dismiss began the same day the Motion before the Panel was filed. (Opening Br. at 5.) Indeed,
Judge Seeborg is scheduled to hear arguments on the second motion on September 15.7 (Brown
Decl. ¶ 4.) Facebook has engaged and continues to engage in extensive discovery in the Cohen
action. (See supra § II(B).)
Plaintiffs base their accusations of forum shopping on highly misleading representations
of an Initial Case Management Conference and hearing in Fraley held before Judge Koh on July
28, 2011. That hearing was not on a dispositive motion, but on a motion for a protective order to
stay discovery pending resolution of Facebook’s motion to dismiss under Rule 12. Briefing on
the motion to dismiss had not yet been completed. As Judge Koh explained at the hearing, to
grant such a stay, she viewed Ninth Circuit law as requiring the Court to conclude that Facebook
was likely to succeed in moving to dismiss the Fraley action. (See Trans. of Procs. Before Judge
Koh (Brown Decl. Ex. A) (“Fraley Hearing Trans.”) at 54.) In holding that Facebook had not
7
Judge Seeborg has also scheduled the Cohen plaintiffs’ motion for class certification to be
heard no later than March 1, 2012. (Brown Decl. Ex. A at 1.)
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 19 of 20
met that burden, Judge Koh explained she believed there were “a lot of . . . close calls” regarding
dismissal and that her ruling was “based on a tentative and very early and very preliminary
review of this case law, which is quite complex.” (See id.) In fact, on the issue of standing,
Judge Koh engaged in the following exchange with the Fraley plaintiffs’ counsel:
[MR. ARNS:] We feel, obviously, strongly with our belief that we
will get by any motion to dismiss, and it is—
THE COURT: We’ll have to see about that, right?
MR. ARNS: That’s correct.
THE COURT: You didn’t even answer the Article III standing. I
read your thing and I thought, ‘Wow, they’ve got nothing to say.
They’ve got nothing to say.”
You know, I always assume people start with the strongest
arguments. I kept thinking, ‘The Article III has got to be here
somewhere,” but I never saw it.
I think there’s a hot, live issue there.
(Id. at 35.) There is no basis for plaintiffs to suggest that Facebook filed its Motion before this
Panel for any improper purpose.
Further, the Fraley and Cohen plaintiffs’ suggestion that Facebook decided to file this
Motion before the Panel based on what occurred at the July 28 hearing before Judge Koh is
nonsense. (Fraley Opp. at 2; Cohen Opp. at 7.) Counsel for Facebook timely disclosed to Judge
Koh at the same July 28 hearing that Facebook was considering filing a motion before the Panel.
(Fraley Hearing Trans. at 41-43.) Facebook’s counsel walked Judge Koh through each of the
five then-pending federal cases, and also noted two similar cases in state court that would not be
subject to the federal MDL process. (Id.)8 There is simply nothing to plaintiffs’ accusations.
8
The Dawes plaintiffs assert that Facebook did not file its Motion until after it had received a
favorable ruling before Judge Seeborg, although “multiple cases have been pending since early
Spring,” insinuating that the timing of the Motion is suspicious. (Dawes Opp. at 4.) But Judge
Seeborg issued his ruling on June 28, 2011, see Cohen v. Facebook, Inc., No. C 10-5282 RS, --F. Supp. 2d ---, 2011 WL 3100565 (N.D. Cal. June 28, 2011), before the Downey action was
even filed (on July 5), only a few weeks after the Dawes complaint was filed (on June 1), and a
little less than eight weeks after the Nastro complaint was filed (on May 2) (see Opening Br. at
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Case MDL No. 2288 Document 25 Filed 08/30/11 Page 20 of 20
III.
CONCLUSION
For the foregoing reasons, Facebook respectfully requests that the Panel grant its Motion
for an order transferring the Actions to the Northern District of California for coordinated or
consolidated pretrial proceedings pursuant to 28 U.S.C. Section 1407.
Dated: August 30, 2011
COOLEY LLP
/s/ Matthew D. Brown
____________________________________
Matthew D. Brown (CA Bar # 196972)
MICHAEL G. RHODES (CA Bar # 116127)
(rhodesmg@cooley.com)
MATTHEW D. BROWN (CA Bar # 196972)
(brownmd@cooley.com)
JEFFREY M. GUTKIN (CA Bar # 216083)
(jgutkin@cooley.com)
COOLEY LLP
101 California Street, 5th Floor
San Francisco, CA 94111-5800
Telephone:
(415) 693-2000
Facsimile:
(415) 693-2222
JONATHAN P. BACH (NY Bar # 2474366)
(jbach@cooley.com)
COOLEY LLP
1114 Avenue of the Americas
New York, NY 10036-7798
Telephone: (212) 479-6000
Facsimile: (212) 479-6275
Attorneys for Defendant FACEBOOK, INC.
2546889/ST
6-7). The facts simply do not support the suggestion of improper motive. If anything, the filing
of overlapping actions in jurisdictions across the country, followed by the strategic dismissal of
certain actions and not others, suggests that plaintiffs’ counsel has engaged in forum shopping.
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