Jensen v. Cablevision Systems Corporation et al
MEMORANDUM OF DECISION & ORDER granting in part and denying in part 33 Motion to Dismiss. For the reasons stated above, the Defendants' motion pursuant to Rule 12(b)(6), to dismiss the Plaintiffs CFAA claims is granted. The motion is denied in all other respects. SEE ATTACHED DECISION for further details. So Ordered by Judge Arthur D. Spatt on 9/27/2017. (Coleman, Laurie)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
PAUL JENSEN, individually and on behalf of
all others similarly situated,
CORPORATION, a Delaware Corporation;
ALTICE N.V., and DOES 1 through 100,
CARNEY BATES & PULLIAM, PLLC
Co-Counsel for the Plaintiff
519 W. 7th Street
Little Rock, Arkansas 72201
Joseph H. Bates, Esq., Of Counsel
THE CASEY LAW FIRM LLC
Co-Counsel for the Plaintiff
20 NE Thompson Street
Portland, Oregon 97212
M. Ryan Casey, Esq., Of Counsel
FAIRCHILD & WADE LLP
Co-Counsel for the Plaintiff
10250 Constellation Blvd., 14th Floor
Los Angeles, California 90067
Gillian L. Wade, Esq.,
Sara D. Avila, Esq., Of Counsel
KU & MUSSMAN, P.A.
Co-Counsel for the Plaintiff
6001 NW 153rd Street, Suite 100
Miami Lakes, Florida 33014
Brian T. Ku, Esq.,
Louis I. Mussman, Esq., Of Counsel
11:36 am, Sep 27, 2017
U.S. DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
LONG ISLAND OFFICE
DECISION & ORDER
MAYER BROWN LLP
Attorneys for the Defendants
1221 Avenue of the Americas
New York, New York 10020
Matthew D. Ingber, Esq., Of Counsel
1999 K Street, N.W.
Washington, DC 20006
Archis A. Parasharami, Esq., Of Counsel
SPATT, District Judge:
The Plaintiff Paul Jensen (“Jensen” or the “Plaintiff”) commenced this action individually
and on behalf of others similarly situated against the Defendants, Cablevision Systems Corporation
(“Cablevision”), and Altice N.V. (“Altice”) (collectively the “Defendants”) for damages stemming
from violations of the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030 and N.Y. Gen.
Bus. Law § 349. This case arises from allegations by the Plaintiff that the Defendants have used
the Plaintiff’s wireless router, which was leased from the Defendants, to broadcast a public Wi-Fi
network, without the Plaintiff’s authorization. The Plaintiff asserts two bases for this Court’s
jurisdiction: federal question jurisdiction pursuant to 28 U.S.C. § 1331 and jurisdiction over the
state law claim under 28 U.S.C. § 1332(d).
Presently before the Court is a motion by the Defendants, pursuant to Federal Rule of Civil
Procedure (“FED. R. CIV. P.” or “Rule”) 12(b)(1), Rule 12(b)(2) and Rule 12(b)(6) to dismiss the
Plaintiff’s entire complaint. The Court pauses here to note that the Plaintiff’s complaint uses
footnotes, which is contrary to this Court’s Individual Rule II.A. Notwithstanding this infraction,
the Court will consider the Plaintiff’s papers in rendering its decision. However, the Court advises
the Plaintiff’s counsel that any future filings that contain footnotes will not be considered by this
For the following reasons, the Defendants’ motion to dismiss pursuant to Rule 12(b)(6) is
granted with respect to the Plaintiff’s CFAA claims for failure to state a claim. The motion is
denied in all other respects.
A. The Factual Background
The following facts are drawn from the Plaintiff’s complaint, and for the purposes of the
instant motion, are accepted as true.
1. The Parties
The Plaintiff is a resident of Brooklyn, New York and a subscriber to Cablevision’s private
Wi-Fi service, Optimum Online Wi-Fi (“Optimum Online Wi-Fi”). Cablevision provided Jensen
a router in conjunction with his purchase of Optimum Online Wi-Fi.
Cablevision is an American corporation, which is incorporated under the laws of the state
of Delaware. Cablevision provides Optimum Online Wi-Fi, along with other cable and internet
services, to customers in New York, New Jersey, Connecticut and Pennsylvania and is registered
with the New York Department of State. Its principle place of business is located at 1111 Stewart
Avenue, Bethpage, New York 11714. In June, 2016, Cablevision was acquired by Altice and has
since done business in the United States as “Altice USA.” Amended Class Action Complaint ¶ 12.
Altice is a Dutch telecommunications company with an international footprint.
principal place of business is in Amsterdam. Altice “provides and/or oversees” Optimum Online
Wi-Fi. Id. ¶ 13.
2. The Facts
On June 5, 2015, Cablevision entered into a contract with the Plaintiff to provide Optimum
Online Wi-Fi for his residence. As part of that agreement, the Plaintiff leased a wireless router
from Cablevision. The Plaintiff had the option to purchase his own wireless router, but chose
instead to lease Cablevision’s device.
Cablevision’s wireless router was used to broadcast Optimum Online Wi-Fi, his personal
Wi-Fi network, as provided in his agreement with Cablevision.
This wireless router was also configured to broadcast a “separate, publically accessible”
Wi-Fi network (“Optimum Public Wi-Fi”), which became a component, along with other
Cablevision wireless routers leased to other customers, of a large-scale, public Wi-Fi network.
Amended Class Action Complaint ¶¶ 16, 46. Optimum Public Wi-Fi is accessible to anyone within
range of the wireless router and is not password protected. Allegedly, this large-scale, public
network is part of a concerted effort by the Defendants to utilize their customer base to compete
with cellular networks. The Plaintiff claims that the Defendants are “externaliz[ing] much of the
capital and operating costs” of such a network, in order to compensate for the lack of their own
network infrastructure. Id. ¶ 16.
According to Jensen, he did not authorize Cablevision to use the wireless router to
broadcast Optimum Public Wi-Fi. During installation, Jensen was provided with a sales order
which contained a document entitled, “General Terms and Conditions of Service.” While this
document did not contain any reference to Optimum Public Wi-Fi, it did state:
In addition to these General Terms and Conditions of Service, Subscriber agrees to
be bound by the terms of service for the applicable Optimum service as set forth at
www.optimum.net, such as Optimum TV, Optimum Online and Optimum Voice,
as well as the Cablevision Customer Privacy Notice, as such may be updated from
time to time (collectively, the “Terms of Service”), which are incorporated herein
by this reference. In the event of any conflict between these Terms and Conditions
below and the Terms of Service, the Terms of Service shall control.
Id. ¶ 40 (internal citations omitted).
The “Service Terms & Info,” a link of which can be found on the Optimum homepage
(www.optimum.net), contains the “Agreement for Optimum Online.”
The “Agreement for
Optimum Online,” states, “The Optimum Router is preconfigured to distribute a second wireless
network (i.e. an Optimum WiFi Hotspot) in addition to the Home Network. This Optimum WiFi
Hotspot is separate from the Home Network and is accessible by certain authorized Optimum WiFi
users.” Id. ¶ 43. Cablevision’s promotional materials are silent on the topic and its website states
that Optimum Public Wi-Fi is broadcast from “shopping centers, major streets, train platforms,
parks, marinas, sports fields and more.” Id. ¶ 19.
When the Plaintiff learned of the existence of the Optimum Public Wi-Fi, he contacted
Cablevision to ask that the feature be disconnected. The Plaintiff was told that the feature could
not be turned off, and that he was free to purchase and use his own wireless router if he continued
to harbor such concerns. A replacement wireless router would cost the Plaintiff between $50 and
The Plaintiff alleges that the Defendants’ actions (1) endanger customers’ privacy; (2)
transfer costs onto customers, including electricity costs; (3) reduce the speed of customer internet
access; and (4) expose customers to increased security risks. Id. ¶ 21.
A study conducted on wireless routers provided by Comcast, a competitor of Cablevision
has determined that wireless routers that broadcast a second Wi-Fi network use more electricity
than wireless routers that only broadcast a single Wi-Fi network. Id. ¶¶ 26-27. This study used a
business wireless router, and concluded that hosting a second Wi-Fi network could cost a customer
up to $1.90 per month, based on the average cost of power in the Mid-Atlantic. Alex Gizis, “Is
Your Comcast Public Hotspot Costing You Real Money?” Speedify (June 26, 2014) (available at
Jensen claims that he has been forced to incur a higher electricity bill as a result of the
Defendants’ wireless router. He further alleges that his Optimum Online Wi-Fi network has
experienced decreased speeds and that the wireless router leased from the Defendants have been
exposed to “possible, additional use by unknown third parties” without his knowledge or
authorization. Amended Class Action Complaint ¶ 51.
B. The Relevant Procedural History
On January 6, 2017, the Plaintiff commenced this action by filing a class action complaint
in this Court. The complaint set forth two causes of action: violations of the CFAA, 18 U.S.C. §
1030, and violations of N .Y. General Business Law § 349.
On January 12, 2017, the Plaintiff filed the Amended Class Action Complaint.
On March 27, 2017, the Defendants filed the instant motion to dismiss all of the Plaintiff’s
claims pursuant to Rule 12(b)(1), Rule 12(b)(2) and Rule 12(b)(6).
On July 6, 2017, the Defendants submitted a Notice of Supplemental Authority regarding
the U.S. Supreme Court’s decision in Bristol-Myers Squibb Co. v. Superior Court of California,
137 S. Ct. 1773, 198 L. Ed. 2d 395 (2017). On July 14, 2017, the Plaintiff filed a response. The
Court reviewed both letters.
A. Standard of Review
1. FED. R. CIV. P. 12(b)(1)
When a defendant brings a motion to dismiss for lack of subject-matter jurisdiction, it is
the plaintiff’s burden to establish the existence of subject-matter jurisdiction by a preponderance
of the evidence. Morrison v. Nat’l Australia Bank Ltd., 547 F.3d 167, 170 (2d Cir. 2008), aff’d,
561 U.S. 247, 130 S. Ct. 2869, 177 L. Ed. 2d 535 (2010) (citing Makarova v. United States, 201
F.3d 110, 113 (2d Cir. 2000)); Aurecchione v. Schoolman Transp. Sys., Inc., 426 F.3d 635, 638
(2d Cir. 2005) (citing Luckett v. Bure, 290 F.3d 493, 497 (2d Cir. 2002)). “A case is properly
dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks
the statutory or constitutional power to adjudicate it.” Makarova, 201 F.3d at 113; see also
Aurecchione, 426 F.3d at 638 (“After construing all ambiguities and drawing all inferences in a
plaintiff’s favor, a district court may properly dismiss a case for lack of subject matter jurisdiction
under Rule 12(b)(1) if it lacks the statutory or constitutional power to adjudicate it.” (internal
citations and quotation marks omitted)).
In its assessment of whether it has subject-matter jurisdiction, the Court “must accept as
true all material factual allegations in the complaint, but [the Court is] not to draw inferences from
the complaint favorable to the plaintiff. J.S. ex rel. N.S. v. Attica Cen. Sch., 386 F.3d 107, 110 (2d
Cir. 2004). The Court may also consider documents that are extrinsic to the complaint in its
analysis. N.Y.S. Catholic Health Plan, Inc. v. Acad. O&P Assoc., 321 F.R.D. 278, 294 (E.D.N.Y.
2015) (citing Phifer v. City of New York, 289 F.3d 49, 55 (2d Cir. 2002)).
2. FED. R. CIV. P. 12(b)(2)
In considering a motion to dismiss pursuant to Rule 12(b)(2), the plaintiff has the burden
of establishing that this Court has jurisdiction over a defendant. Minnie Rose LLC v. Yu, 169 F.
Supp. 3d 504, 510 (S.D.N.Y. 2016) (internal citations omitted); Brussels Lambert v. Fiddler
Gonzalez & Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999). To meet this burden at the motion to
dismiss stage, the plaintiff is only required to make a prima facie showing of jurisdiction. Whitaker
v. Am. Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2001); Dorchester Fin. Sec., Inc. v. Banco
BRJ, S.A., 722 F.3d 81, 84 (2d Cir. 2013). When the parties have not yet begun discovery, as is the
present case, the Court accepts the allegations in the Plaintiff’s amended complaint to be true, but
may also rely on additional supporting material to determine if the Plaintiff meets this burden. See
Uebler v. Boss Media, AB, 363 F. Supp. 2d 499, 501 (E.D.N.Y. 2005) (Spatt, J.); see also Casville
Invs., Ltd. v. Kates, No. 12-cv-6968, 2013 WL 2365816, at *3 (S.D.N.Y. July 8, 2013); Art Assure
Ltd., LLC v. Artmentum GmbH, No. 14-cv-3756, 2014 WL 5757545, at *2 (S.D.N.Y. Nov. 4, 2014)
(“[A] plaintiff may not rely on conclusory statements without any supporting facts, as such
allegations would ‘lack the factual specificity necessary to confer jurisdiction.’”) (quoting Jazini
v. Nissan Motor Co., Ltd., 148 F.3d 181, 185 (2d Cir.1998)). The Court is permitted to rely on
material outside the pleading. See Minnie Rose LLC, 169 F. Supp. 3d at 510 (internal citations
3. FED. R. CIV. P. 12(b)(6)
In considering a motion to dismiss pursuant to Rule 12(b)(6), the Court must accept the
factual allegations set forth in the complaint as true and draw all reasonable inferences in favor of
the Plaintiff. See, e.g., Walker v. Schult, 717 F.3d 119, 124 (2d Cir. 2013); Cleveland v. Caplaw
Enters., 448 F.3d 518, 521 (2d Cir. 2006); Bold Elec., Inc. v. City of New York, 53 F.3d 465, 469
(2d Cir. 1995); Reed v. Garden City Union Free Sch. Dist., 987 F. Supp. 2d 260, 263 (E.D.N.Y.
Under the Twombly standard, the Court may only dismiss a complaint if it does not contain
enough allegations of fact to state a claim for relief that is “plausible on its face.” Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 1974, 167 L. Ed. 2d 929 (2007). The Second
Circuit has expounded that, after Twombly, the Court’s inquiry under Rule 12(b)(6) is guided by
First, although a court must accept as true all of the allegations contained in a
complaint, that tenet is inapplicable to legal conclusions, and [t]hreadbare recitals
of the elements of a cause of action, supported by mere conclusory statements, do
not suffice. Second, only a complaint that states a plausible claim for relief survives
a motion to dismiss and [d]etermining whether a complaint states a plausible claim
for relief will . . . be a context-specific task that requires the reviewing court to draw
on its judicial experience and common sense.
Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 664, 129
S. Ct. 1937, 1940, 173 L. Ed. 2d 868 (2009)).
A complaint must include “a short and plain statement of the claim showing that the pleader
is entitled to relief,” in order to survive a motion to dismiss. FED. R. CIV. P. 8(a)(2). Under Rule
8, a complaint is not required to allege “detailed factual allegations.” Kendall v. Caliber Home
Loans, Inc., 198 F. Supp. 3d 168, 170 (E.D.N.Y. 2016) (quoting Twombly, 550 U.S. at 555). “In
ruling on a motion pursuant to FED. R. CIV. P. 12(b)(6), the duty of a court ‘is merely to assess the
legal feasibility of the complaint, not to assay the weight of the evidence which might be offered
in support thereof.’” DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 113 (2d Cir. 2010) (quoting
Cooper v. Parsky, 140 F.3d 433, 440 (2d Cir. 1998)). The Court “[is] not bound to accept as true
a legal conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555.
B. Subject-Matter Jurisdiction
The Defendants contend that Jensen’s claims should be dismissed for lack of subject-matter
jurisdiction, under Rule 12(b)(1). According to the Defendants, Jensen originally filed a putative
class action case in this District in July, 2015 alleging violations of (1) the CFAA, (2) commonlaw trespass to chattels, (3) unjust enrichment, and (4) N.Y. General Business Law § 349, seeking
to certify a nationwide class and New York subclass. Defendants’ Memorandum of Law in
Support of Motion to Dismiss at 3. Cablevision filed a motion to dismiss, which was fully briefed
on May 16, 2016. The parties meanwhile, commenced discovery. Plaintiff’s Memorandum in
Opposition to Defendants’ Motion to Dismiss at 3.
On November 4, 2016, Jensen filed a letter seeking certification of a New York class only,
pursuant to N.Y. General Business Law § 349. Id.
On December 28, 2016, the parties filed a Stipulation of Voluntary Dismissal, seeking a
dismissal on the remaining claims without prejudice, pursuant to FED. R. CIV. P. 41(a)(1)(ii).
On January 6, 2017, Judge Wexler dismissed all the counts in the complaint without
prejudice. Judge Wexler found that with the dismissal of the first three counts, as requested by the
parties, the court no longer had jurisdiction as to the remaining state law claim, N.Y. General
Business Law § 349. All claims were dismissed without prejudice and the Clerk of the Court was
directed to close the case. Id. at 4. That same day, on January 6, 2017, the Plaintiff filed the first
complaint in this action in this Court, adding a new defendant, Altice.
First, the dismissal of the original claims of the first case has no res judicata effect because
it was not a final judgment. Judge Wexler entered his order dismissing the claims “without
prejudice.” Thus, Jensen remained free to renew his claims in a new action. “It is well established
that a dismissal without prejudice has no res judicata effect on a subsequent claim.” Camarano v.
Irvin, 98 F.3d 44, 47 (2d Cir. 1996) (per curiam); accord Sandstrom v. ChemLawn Corp., 904 F.2d
83, 86 (1st Cir. 1990) (“[A] voluntary dismissal under Fed. R. Civ. P. 41(a) wipes the slate clean,
making any future lawsuit based on the same claim an entirely new lawsuit unrelated to the earlier
(dismissed) action.”); Morales v. Suny Purchase College, No. 14-cv-8193, 2015 WL 7430864, at
*3 (S.D.N.Y. Nov. 19, 2015) (“Nevertheless, claims dismissed without prejudice in an earlier
action are not barred by res judicata.” (internal citations omitted)). Accordingly, the Defendants’
arguments as to the previous case are irrelevant to this Court’s subject-matter jurisdiction.
Further, the Defendants’ reliance on United States v. McGann, 951 F. Supp. 372 (E.D.N.Y.
1997), is misplaced. Although the Court granted the defendant’s motion to dismiss the complaint
in McGann, it was based on the plaintiff’s failed attempt to amend the complaint. The Court noted
that in the Second Circuit, the denial of a motion to amend a complaint is not appealable. McGann,
951 F. Supp. at n.2. As such, McGann’s result and reasoning rested on a procedural posture that
is not present here.
Accordingly, the Defendants’ motion to dismiss for lack of subject matter jurisdiction,
pursuant to Rule 12(b)(1) is denied.
C. Personal Jurisdiction
The Defendants assert that this Court lacks personal jurisdiction over Altice. In opposition,
the Plaintiff argues that at best, the Defendants create a factual dispute that is not properly resolved
on a motion to dismiss. The Court finds that for the reasons stated below, Altice is subject to
specific personal jurisdiction in this matter.
To establish a prima facie case of personal jurisdiction, “a Plaintiff must demonstrate: (1)
proper service of process upon the defendant; (2) a statutory basis for personal jurisdiction over
the defendant; and (3) that exercise of jurisdiction over the defendant is in accordance with
constitutional due process principles.” Stroud v. Tyson Foods, Inc., 91 F. Supp. 3d 381 (E.D.N.Y.
2015) (citing Licci ex rel. Licci v. Lebanese Canadian Bank, SAL, 673 F.3d 50, 59-60 (2d Cir.
2012)). In this case, the Defendants do not challenge service of process. Consequently, the Court
turns to the second and third elements of a prima facie case for personal jurisdiction.
The Court will determine the existence of personal jurisdiction in accordance with New
York Law. Minnie Rose LLC, 169 F. Supp. 3d at 512 (“In diversity or federal question cases,
personal jurisdiction is determined in accordance with the law of the forum in which the federal
court sits.” (internal citations omitted)). Prior to Daimler AG v. Bauman, 134 S. Ct. 746, 187 L.
Ed. 2d 264 (2014), New York law required a two-step analysis: (1) the Court must determine
whether there is personal jurisdiction that (a) conforms to New York’s general jurisdiction statute,
Civil Practice Law and Rules (“CPLR”) § 301, or (b) conforms to New York’s long-arm
jurisdiction statute, CPLR § 302(a); and if so, (2) the Court must find that it’s exercise of personal
jurisdiction is consistent with the Fifth Amendment’s Due Process Clause. JN Realty LLC v. Estate
of Marvin, 268 F. Supp. 2d 231, 235 (E.D.N.Y. 2003) (Spatt, J.); see also Stroud, 91 F. Supp. 3d
at 385 (explaining the elements of a prima facie case for personal jurisdiction under New York
law); Uebler, 363 F. Supp. 2d at 504 (“If there is jurisdiction under New York law, then the Court
must evaluate whether the exercise of that jurisdiction comports with the requirements of due
process.” (internal citations omitted)).
1. General Jurisdiction
CPLR § 301 instructs that a corporation “is subject to general personal jurisdiction in New
York if it is ‘doing business’ in the state.” Wiwa v. Royal Dutch Petro. Co., 226 F.3d 88, 95 (2d
Cir. 2000). “[A] corporation is ‘doing business’ and is therefore ‘present’ in New York and subject
to personal jurisdiction with respect to any cause of action, related or unrelated to the New York
contacts, if it does business in New York ‘not occasionally or casually, but with a fair measure of
permanence and continuity.’” Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 58 (2d Cir.
1985) (quoting Tauza v. Susquehanna Coal Co., 220 N.Y. 259, 267, 115 N.E. 915 (1917)).
In light of the U.S. Supreme Court’s ruling in Daimler, it is unclear if New York’s statutory
jurisprudence remains proper. See Gucci Am., Inc. v. Weixing Li, 768 F.3d 122, 135 (2d Cir. 2014)
(“[T]he Court expressly cast doubt on previous Supreme Court and New York Court of Appeals
cases that permitted general jurisdiction on the basis that a foreign corporation was doing business
through a local branch office in the forum.”); accord Bertolini-Mier v. Upper Valley Neurology
Neurosurgery, P.C., No. 5:16-cv-35, 2016 WL 7174646, at *4 (D. Vt. Dec. 7, 2016) (“The
Supreme Court’s decision in Daimler . . . changed the law of general jurisdiction, making it
substantially more difficult to establish that type of personal jurisdiction.” (citing Brown v.
Lockheed Martin Corp., 814 F.3d 619, 627 (2d Cir. 2016))); Cortlandt St. Recovery Corp. v.
Deutsche Bank AG, London Branch, No. 14-cv-01568, 2015 WL 5091170, at *3 (S.D.N.Y. Aug.
28, 2015) (“[I]t is uncertain if New York's ‘doing business’ jurisdiction remains viable in light of
Daimler.” (citing Reich v. Lopez, 38 F. Supp. 3d 436, 454–55 (S.D.N.Y. 2014))); Havlish v. Royal
Dutch Shell PLC, No. 13-civ.-7074, 2014 WL 4828654, at *3 (S.D.N.Y. Sept. 24, 2014) (“The
Supreme Court in Daimler . . . recently ‘expressed doubts as to the usefulness of an agency analysis,
like that espoused in Wiwa, that focuses on a forum-state affiliate’s importance to the defendant rather
than on whether the affiliate is so dominated by the defendant as to be its alter ego.’” (quoting Sonera
Holding B.V. v. Cukurova Holding AS., 750 F.3d 221, 225 (2d Cir. 2014) cert. denied, 134 S. Ct. 2888
In Daimler, the Court concluded that general jurisdiction only exists where a corporation
is “essentially at home.” Daimler, 134 S. Ct. at 761-62. To determine this, courts must primarily
look at the corporation’s principal place of business and place of incorporation. Id. at 759-60. The
Plaintiff does not allege that Altice has incorporated anywhere in the United States, let alone New
York, and admits in the amended complaint that its principal place of business is in Amsterdam.
Therefore, under either measure, Altice lacks general jurisdiction.
In Daimler, the Court articulated an additional, “exceptional case” to find general
jurisdiction. If the Plaintiff demonstrates that Altice’s contacts with New York are “so ‘continuous
and systematic’ as to render [Altice] essentially at home with the forum state,” general jurisdiction
may be found. Id. at 761. As this is truly an “exceptional case,” courts have noted that it is
exceedingly rare to find general jurisdiction outside a corporation’s principal place of business or
place of incorporation. Stroud, 91 F. Supp. 3d at 387 (citing Monkton Ins. Servs., Ltd. v. Ritter,
768 F.3d 429, 432 (5th Cir. 2014)); see also SPV OSUS Ltd. v. UBS AG, 114 F. Supp. 3d 161, 168
(S.D.N.Y. 2015) (determining that even if the defendant’s contacts to New York could be
considered “a substantial, continuous, and systematic course of business,” the Supreme Court held
in Daimler that such contact were insufficient to establish general jurisdiction, because the
plaintiffs failed to “establish that this is the ‘exceptional case’ in which a corporation is ‘essentially
at home’ in a foreign forum such that the Court may exercise general jurisdiction over it.”).
In this case, the Plaintiff has not properly alleged that Altice’s contacts with New York are
so substantial that it is “essentially at home.” Although Altice does have a New York subsidiary,
that does not “render it essentially at home.” Hecklerco, LLC v. YuuZoo Corporation Ltd., No.
15-cv-5779, 2017 WL 2294606, at *5 (S.D.N.Y. May 11, 2017). Thus, the Court finds that Altice
is not subject to general jurisdiction in the State of New York.
2. Specific Jurisdiction
The Defendants allege that the Plaintiff’s allegations solely relate to Altice’s subsidiary,
Cablevision, which became known as Altice USA after the Altice/Cablevision transaction, and
may not be attributed to Altice for the purpose of obtaining specific personal jurisdiction. For the
reasons set forth below, the Plaintiff has established a prima facie case and the Court will exercise
specific jurisdiction over Altice in this matter.
For the Court to exercise specific jurisdiction over a non-domiciled entity, it must be
subject to New York’s long-arm statute, CPLR § 302(a), which states that:
As to a cause of action arising from any of the acts enumerated in this section, a
court may exercise personal jurisdiction over any non-domiciliary, or his executor
or administrator, who in person or through an agent:
1. transacts any business within the state or contracts anywhere to supply goods or
services in the state; or
2. commits a tortious act within the state, except as to a cause of action for
defamation of character arising from the act; or
3. commits a tortious act without the state causing injury to person or property
within the state, except as to a cause of action for defamation of character arising
from the act, if he
(i) regularly does or solicits business, or engages in any other persistent course of
conduct, or derives substantial revenue from goods used or consumed or services
rendered, in the state, or
(ii) expects or should reasonably expect the act to have consequences in the state
and derives substantial revenue from interstate or international commerce; or
4. owns, uses or possesses any real property situated within the state.
N.Y. CPLR § 302.
“To establish personal jurisdiction under section 302's [“transacts any business” prong],
two requirements must be met: (1) The defendant must have transacted business within the state;
and (2) the claim asserted must arise from that business activity.” Eades v. Kennedy, PC Law
Offices, 799 F.3d 161, 168 (2d Cir. 2015) (quoting Licci ex rel. Licci v. Lebanese Canadian Bank
SAL, 732 F.3d 161, 168 (2d Cir. 2013)). “A plaintiff attempting to establish personal jurisdiction
over a defendant who has never been present in the state and only acted through subsidiaries or
agents need only show that the subsidiary ‘engaged in purposeful activities in this State,’ that those
activities were ‘for the benefit of and with the knowledge and consent of’ the defendant, and that
the defendant ‘exercised some control over’ the subsidiary in the matter that is the subject of the
lawsuit.” Ingenito v. Riri USA, Inc., 89 F. Supp. 3d 462, 476-77 (E.D.N.Y. 2015) (quoting Kreutter
v. McFadden Oil Corp., 71 N.Y.2d 460, 467, 527 N.Y.S.2d 195, 522 N.E.2d 40 (1988)); accord
Pfizer Inc. v. Perrigo Co., 903 F. Supp. 14, 16 (S.D.N.Y.1995) (“[A] foreign corporation can sell
goods and perform other activities in New York through its subsidiaries, subjecting the parent
corporation to personal jurisdiction in New York.” (internal citations omitted)).
A formal agency relationship between the Defendants and the subsidiary/agent is not
required. Ingenito, 89 F. Supp. 3d at 467 (internal citations omitted). “Personal jurisdiction over
a parent corporation whose subsidiary has transacted business in New York exists when the
nondomicilliary parent corporation knew of and consented to the acts of its in-state subsidiary that
gave rise to the cause of action, and exercised some control over [the subsidiary] in the matter.”
Ingenito, 89 F. Supp. 3d at 477 (internal quotations omitted).
Cablevision, or Altice USA, is a public subsidiary that is majority owned by Altice.
Through Cablevision, Altice transacts business in New York. Amended Class Action Complaint
¶ 9. Cablevision’s wireless network is operated with the knowledge, and with some level of
direction from Altice. See id.; Joint Application of Altice N.V. and Cablevision Systems Corp. for
Authority Pursuant to Section 214 of the Communications Act of 1934, as Amended, to Transfer
Control of Domestic and International Section 214 Authorizations at 9-10 (available at
https://ecfsapi.fcc.gov/file/60001329304.pdf) (“If the Transaction is approved, Altice would bring
to Cablevision its considerable experience in upgrading and managing Cablevision’s network. the
transmission and IT assets of its service provider affiliates. Furthermore, Altice intends to continue
investing in and upgrading Cablevision’s IT systems, including customer care, service
provisioning and billing systems, to improve processes and be in an even better position to serve
customers. . . .Altice anticipates continuing to invest in WiFi services to complement its fixed
wireline investment.”). Further, Altice “derives substantial revenue” from Cablevision’s Wi-Fi
operations in the New York area. Amended Class Action Complaint ¶ 9.
The Court finds that for the purposes of CPLR § 302(a)(1), Altice has engaged in sufficient
purposeful activity in New York to determine that it has “transacted business,” and that this
Plaintiff’s claims arise from this business. Therefore, the Plaintiff has sufficiently presented a
prima facie case to establish specific personal jurisdiction over Altice in this matter.
Although the Defendants argue that Cablevision is not an “agent” or “mere department” of
Altice so that this Court has no personal jurisdiction over Altice, the Defendants’ argument focuses
on the scope of general jurisdiction, see e.g., CPLR § 301; Volkswagenwerk Aktiengesellschaft v.
Beech Aircraft Corp., 751 F.2d 117, 120 (2d Cir. 1984), not the applicability of specific jurisdiction
under § 302(a)(1). The Court is unpersuaded that the Defendants’ argument is applicable to §
3. Constitutional Due Process
The Court must now consider whether exercising specific personal jurisdiction over Altice
comports with the United States Constitution’s Due Process Clause. International Shoe and its
progeny made clear that a defendant must “have certain minimum contacts [with the forum state]
such that maintenance of the suit does not offend traditional notions of fair play and substantial
justice.” Licci, 732 F.3d at 169 (quoting Int'l Shoe Co. v. State of Wash., Office of Unemployment
Comp. & Placement, 326 U.S. 310, 316, 66 S. Ct. 154, 90 L. Ed. 95 (1945)). If the Court finds
that there are sufficient “minimum contacts,” the Court must also find that exercising jurisdiction
would be reasonable under the circumstances. Strauss v. Credit Lyonnais, S.A., 175 F. Supp. 3d
3, 27 (E.D.N.Y. 2016) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-77, 105 S. Ct.
2174, 85 L. Ed. 2d 528 (1985)). To conduct the second part of the analysis, the Court may look at
the following relevant factors: “(1) the burden that the exercise of jurisdiction will impose on the
defendant; (2) the interests of the forum state in adjudicating the case; [and] (3) the plaintiff's
interest in obtaining convenient and effective relief....” Metro. Life Ins. Co. v. Robertson–Ceco
Corp., 84 F.3d 560, 568 (2d Cir. 1996).
As the Second Circuit notes, there is extensive overlap between a CPLR § 302(a) analysis,
which the Court has just conducted, and a constitutional due process analysis, because “if a
defendant transacted business in New York and the claim asserted arose from that business activity
within the meaning of section 302(a)(1), and yet, in connection with the same transaction of
business, the defendant cannot be found to have ‘purposefully availed itself of the privilege of
doing business in the forum and [to have been able to] foresee being hauled into court there . . . or
the assertion of specific jurisdiction would somehow otherwise ‘offend traditional notions of fair
play and substantial justice.” Licci, 732 F.3d at 170 (internal quotations omitted). Thus it is
especially unusual to find that a defendant has met the requirements of § 302(a)(1), yet failed a
due process analysis. The Court is unaware of any such decisions in the Second Circuit. See id.
As the Court has already determined that Altice satisfies the provision of § 302(a)(1), the
Court also concludes that Altice has established purposeful availment appropriate to establish
“minimum contacts.” Id.; see also Burger King Corp., 471 U.S. at 475-78.
Regarding the “reasonableness” inquiry, the Court notes that the Second Circuit instructed
district courts that “dismissals resulting from the application of the reasonableness test should be
few and far between.” Metro. Life Ins. Co., 84 F.3d at 575. The parties have raised no credible
argument that any of the relevant factors point to dismissal. As such, the Court’s exercise of
specific personal jurisdiction over Altice is consistent with the U.S. Constitution’s Due Process
Accordingly, the Court finds that there is specific personal jurisdiction over Altice. For
the foregoing reasons, the Defendants’ motion to dismiss for lack of personal jurisdiction, pursuant
to Rule 12(b)(2) is denied.
D. The Computer Fraud and Abuse Act Claim
The Defendants contend that the Plaintiff’s complaint fails to state a plausible claim based
on a violation of the CFAA. In particular, the Defendants assert that (a) the Plaintiff consented to
allowing the Defendants to use the wireless router to set up Optimum Public Wi-Fi; and (b) the
Plaintiff is unable to satisfy the minimum loss requirement under the CFAA.
In 1984, the U.S. Congress enacted the CFAA to combat forms of “computer crime.” At
the time, this was largely understood as “hacking or trespassing into computer systems or data.”
United States v. Valle, 807 F.3d 508, 525 (2d Cir. 2015). The CFAA made it a crime to “knowingly
and with intent to defraud, accesses a protected computer without authorization, or exceeds
authorized access, and by means of such conduct furthers the intended fraud and obtains anything
of value, unless the object of the fraud and the thing obtained consists only of the use of the
computer and the value of such use is not more than $5,000 in any 1-year period.” 18 U.S.C. §
Congress also created a civil cause of action under the CFAA if a plaintiff could
(I) loss to 1 or more persons during any 1-year period (and, for purposes of an investigation,
prosecution, or other proceeding brought by the United States only, loss resulting from a
related course of conduct affecting 1 or more other protected computers) aggregating at
least $5,000 in value;
(II) the modification or impairment, or potential modification or impairment, of the medical
examination, diagnosis, treatment, or care of 1 or more individuals;
(III) physical injury to any person;
(IV) a threat to public health or safety;
(V) damage affecting a computer used by or for an entity of the United States Government
in furtherance of the administration of justice, national defense, or national security; or
(VI) damage affecting 10 or more protected computers during any 1-year period.
18 U.S.C. § 1030(c)(4)(A); see also id. at § 1030(g).
The Plaintiff pleads a private right of action pursuant to 18 U.S.C. § 1030(c)(4)(a)(i)(I).
Consequently, the Plaintiff must allege that the Defendants: (1) “knowingly and with intent to
defraud;” (2) accessed a “protected computer;” (3) “without authorization” or “exceeded their
authorized access;” (4) and by means of such conduct furthered the intended fraud and obtained
anything of value; and (5) caused “loss to 1 or more persons during any 1–year period ...
aggregating at least $5,000 in value.” See id. at § 1030(c)(4)(A), § 1030(g).
The Defendants contend that the Plaintiff failed to properly plead a claim for relief under
the CFAA because the Plaintiff consented to the purported use of the wireless router. For the
reasons stated below, the Court finds that there is a factual dispute as to whether Jensen consented
to use of the wireless router to set up Optimum Public Wi-Fi, which precludes the Court from
dismissing the claim at this time.
While the term “without authorization,” is not defined within the statute, it has no
applicability to this case. See JBC Holdings NY, LLC v. Pakter, 931 F. Supp. 2d 514, 521
(S.D.N.Y. 2013). It is undisputed that Cablevision had authorization to access their own wireless
routers for certain uses. The question is whether Cablevision “exceed[ed]” their authorization.
According to the CFAA, the term “exceeds authorized access,” “means to access a computer with
authorization and to use such access to obtain or alter information in the computer that the accesser
is not entitled so to obtain or alter.” 18 U.S.C. § 1030(e)(6). The Second Circuit recently ruled
that “exceeds authorized access” only covers an individual “who obtains or alters information that
he does not have authorization to access for any purpose.” Valle, 807 F.3d at 511. This narrow
reading of the statute is also consistent with the Fourth, and Ninth Circuits. Associated Mortg.
Bankers, Inc. v. Calcon Mut. Mortg. LLC, 159 F. Supp. 3d 324, 334 (E.D.N.Y. 2016) (Spatt, J.);
see also Sebrite Agency, Inc. v. Platt, 884 F. Supp. 2d. 912, 917-18 (D. Minn. 2012) (adopting the
narrower interpretation of the CFAA because it is “more consistent with statutory text, legislative
history, and the rule of lenity” and noting that the Eighth Circuit has not yet directly addressed the
issue (internal citations omitted)).
While the Second Circuit noted that the First, Fifth, Eleventh, and Seventh Circuits had
adopted a broader interpretation of the statute, the Court determined that such a view “would
criminalize the conduct of millions of ordinary computer users and place us in the position of a
legislature.” Id. (quoting Valle, 807 F.3d at 527); accord Pakter, 931 F. Supp. 2d at 521. The
Court thereby adopts the Second Circuit’s definition of “exceeds authorized access,” meaning that
liability may only be imposed if one “obtains or alters information that [it] does not have
authorization to access for any purpose which is located on a computer that [it] is otherwise
authorized to access.” Valle, 807 F.3d at 511.
The Defendants contend that Jensen consented to Cablevision’s broadcast of the Optimum
Public Wi-Fi because the Agreement for Optimum Online contained the following explicit
language: “The Optimum Router is preconfigured to distribute a second wireless network (i.e. an
Optimum WiFi Hotspot) in addition to the Home Network. This Optimum WiFi Hotspot is
separate from the Home Network and is accessible by certain authorized Optimum WiFi users.”
See Defendants’ Memorandum of Law in Support of Motion to Dismiss at 15. The Plaintiff asserts
that this was not part of the contract, and that alternatively, it creates a dispute as to a material fact.
For the reasons that follow, the Court concludes that while the Defendants raise a dispute as to this
fact, this is not properly determined at the motion to dismiss stage.
According to the Defendants, the Agreement for Optimum Online was incorporated by
reference into the contract. Under New York law, “[t]he doctrine of incorporation by reference
requires that the paper to be incorporated into the written instrument by reference must be so
described in the instrument that the paper may be identified beyond all reasonable doubt . . . [and]
[i]t must be clear that the parties to the agreement had knowledge of and assented to the
incorporated terms.” Valley Stream Foreign Cars, Inc. v. American Honda Motor Co., Inc., 209
F. Supp. 3d 547, 552-53 (E.D.N.Y. 2016) (internal citations and quotations omitted); accord
Serrano v. Cablevision Systems Corp., 863 F. Supp. 2d 157, 165 (E.D.N.Y. 2012).
Jensen maintains that he did not agree to any terms when he signed up for wireless internet
with Cablevision originally. Amended Class Action Complaint ¶ 37. When his wireless router
was installed, he was provided a sales order, which contains a document titled “General Terms and
Conditions of Service.” The Plaintiff alleges that this document contains the entirety of the
contract. Id. ¶ 38. One clause in the General Terms and Conditions of Service does mention that
there are additional terms of service “set forth at www.optimum.net . . . which are incorporated
herein by this reference.” Id. ¶ 40. However, the website which is referred is the consumer-facing
homepage, and only by clicking a link titled “Service Terms & Info” is the visitor brought to a
series of additional terms for the various services that Cablevision offers. Id. ¶¶ 41-42.
The Defendants’ principally rely on Serrano to contend that Cablevision’s Agreement for
Optimum Online is included in the contract. In the Court’s view, this case reinforces the factual
dispute at issue. In Serrano, it was undisputed that the terms of service at issue were “incorporated
by reference into the work order and were accessible on the Cablevision website.” Id. at 165. This
was the basis for the Court’s conclusion that the plaintiff in that case entered into a valid contract
with Cablevision. Id. In this case, the Plaintiff disputes the contention that the Agreement for
Optimum Online is incorporated by reference into the contract and alleges that any attempt to do
so in the contract was vague and legally insufficient. Therefore, the lynchpin of the Serrano
Court’s conclusion is not present here. In the Court’s view, Serrano is not controlling.
The Defendants also rely on Hammer v. Cablevision of Boston, Inc., 18 Misc. 3d 727 (N.Y.
Just. Ct. 2007) as an example of a court incorporating Cablevision’s online terms of service into a
contract. However, the Hammer decision is short on details and devoid of reasoning on the matter.
The pertinent facts surrounding the terms that are being incorporated by reference are not disclosed
in the opinion and the Hammer Court does not conduct any sort of legal analysis to reach such a
conclusion. This lack of detail does not convince the Court that the document referenced was
incorporated into the contract “beyond all reasonable doubt.” Valley Stream Foreign Cars, Inc.,
209 F. Supp. 3d at 552-53.
The Defendants’ argument that the Agreement for Optimum Online is incorporated by
reference does not satisfy the first prong of the test under New York law. The General Terms and
Conditions of Service’s reference to the litany of terms and conditions for a variety of Cablevision
products does not identify the terms and conditions that apply to the Plaintiff so that it may be
properly identified “beyond all reasonable doubt” at this stage. See 4Connections LLC v. Optical
Commc’ns Grp., Inc., 618 F. Supp. 2d 178, 183 (E.D.N.Y. 2009) (“To incorporate a document by
reference, New York law requires that the document be referenced beyond all reasonable doubt.”
(citing Chiacchia v. Nat’l Westminster Bank USA, 124 A.D.2d 626, 507 N.Y.S.2d 888, 889-90 (2d
Dep’t 1986))); see also Sea Trade Co. v. FleetBoston Fin. Corp., No. 03-civ-10254, 2007 WL
1288592, at *4 (S.D.N.Y. May 1, 2007) (“Under New York law, an extrinsic document is deemed
to be incorporated by reference only when the agreement specifically references and sufficiently
describes the document to be incorporates, such that the latter ‘may be identified beyond all
reasonable doubt.’” (quoting PaineWebber, Inc. v. Bybyk, 81 F.3d 1193, 1201 (2d Cir. 1996)
(internal quotations omitted))).
The reference in the General Terms and Conditions of Service is to the Optimum branded
homepage, not the specific terms of service that are at issue. Further, the “Terms of Service,” as
defined incorporates additional Cablevision services that are inapplicable to an Optimum Online
residential customer. This includes terms and conditions for non-subscribers and for businesses.
Amended Class Action Complaint ¶¶ 41-43. Accordingly, the Court finds that at the very least,
there is a triable issue of fact as to whether the Agreement for Optimum Online is incorporated by
Reference. Because a genuine issue of material fact exists as to whether the Defendants accessed
the Plaintiff’s wireless router without authorization, the Defendants’ motion is denied on that basis.
2. CFAA Minimum Loss Requirement
The Defendants further argue that the Plaintiff’s damages for his CFAA claims are
deficient because the pleading fails to meet the CFAA’s minimum loss requirement. In opposition,
the Plaintiff contends that he may aggregate all putative class members’ claims for the purposes
of meeting the statutory requirement. For the reasons stated below, the Court finds that the Plaintiff
failed to satisfy the statutory loss requirement under 18 U.S.C. § 1030(c)(4)(A)(i)(I).
In order to properly plead damages under the Plaintiff’s CFAA claim, he must allege “loss
to 1 or more persons during any 1-year period … aggregating at least $5,000 in value.” 18 U.S.C.
§ 1030(c)(4)(A)(i)(I). “Damage” is defined by the CFAA as “any impairment to the integrity or
availability of data, a program, a system, or information.” Id. § 1030(e)(8). The CFAA explains
“loss” as “any reasonable cost to any victim, including the cost of responding to an offense,
conducting a damage assessment, and restoring the data, program, system, or information to its
condition prior to the offense, and any revenue lost, cost incurred, or other consequential damages
incurred because of interruption of service.” Id. § 1030(e)(11). The Plaintiff is required to plead
damages or losses of $5,000 as per the minimum statutory threshold specified in §
1030(c)(4)(A)(i)(I). See Register.com, Inc. v. Verio, 356 F.3d 393, 439 (2d Cir.2004) (citing In re
DoubleClick Inc. Privacy Litig., 154 F. Supp. 2d 497, 520–23 (S.D.N.Y.2001)); See also
DoubleClick, 154 F. Supp. 2d at 522 (“Caselaw further supports the conclusion that all injuries
under § 1030(g) are subject to § 1030(e)(8)’s $5,000 threshold, whether termed ‘damage’ or
In this regard, Jensen pleads five types of damage or loss: (1) increased electricity costs;
(2) invasion of his privacy; (3) decreased internet speeds; (4) increased security risks; and (5) the
replacement cost of a new wireless router.
The Plaintiff’s allegations concerning increased security risks, decreased internet speeds
and invasion of his privacy are not cognizable economic losses under the CFAA. See DoubleClick,
154 F. Supp. 2d at 524 n.33 (“[O]nly economic losses are recoverable under § 1030(g).” (internal
citations omitted)). In order for a form of damage or loss to be used to meet the statutory damages
threshold, the damage or loss must be economic. See id. The Plaintiff’s complaint fails to allege
that Jensen suffered any economic damages at all due to any of the three categories of damages.
As such, the Court finds that any security or privacy risks that the Plaintiff is exposed to or
decreased internet speeds as a result of the Optimum Public Wi-Fi are not cognizable losses under
For the remaining two categories, the Plaintiff’s individual damage allegations fail to reach
the $5,000 statutory threshold. As Jensen pleads in the complaint, “consumers wishing to opt out
of broadcasting a secondary Wi-Fi network from their homes are left with no recourse other than
to buy an entirely new wireless router, costing anywhere from $50 to $200.” Amended Class
Action Complaint ¶ 33. The Court will assume that for purposes of calculating the statutory
threshold that the replacement cost of a wireless router is $200.
The final damage or loss alleged by Jensen is increased electricity costs that are incurred
as a result of the additional electrical power used due to using a wireless router that is configured
to use Optimum Public Wi-Fi. This includes additional power both when the Optimum Public WiFi network is being used and when it is not being used. The Plaintiff does not specify in the
complaint what his additional electricity costs from Optimum Public Wi-Fi were, but he does
attach a study that concluded that hosting a public Wi-Fi hotspot for Comcast, one of Cablevision’s
competitors, cost up to $22.80 per year for a Philadelphia resident. Alex Gizis, “Is Your Comcast
Public Hotspot Costing You Real Money?” Speedify (June 26, 2014) (available at
http://speedify.com/blog/featured/comcast-public-hotspot-cost/). Even assuming a higher average
cost of power in Brooklyn, New York and a less efficient router, it is highly improbable that
Jensen’s extra electricity costs approached $100 let alone $5,000. As a result, when the Court
combines the cognizable losses that are covered under the statute, Jensen fails to allege enough
damages or loss to meet the requirement under the CFAA.
The Plaintiff tries to circumvent this fact by claiming that the Court should aggregate
putative class members’ damages or losses. For the reasons set forth below, this argument is
“As a general rule, until a class action is certified pursuant to Rule 23 of the Federal Rules
of Civil Procedure, the claims of potential class members cannot be considered.” Biscone v.
JetBlue Airways Corp., 681 F. Supp. 2d 383, 386 (E.D.N.Y. 2010) (citing Baxter v. Palmigiano,
425 U.S. 308, 310 N. 1, 96 S. Ct. 1551, 47 L. Ed. 2d 810 (1976)); Bowens v. Atl. Maint. Corp.,
546 F. Supp. 2d 55, 76 (E.D.N.Y. 2008) (“[I]n the absence of certification, there is no class action
under Rule 23. The unnamed class members are not technically part of the action until the court
has certified the class; therefore, once the named plaintiffs’ claims are dismissed, there is no one
who has a justiciable claim that may be asserted.” (internal citations and quotations omitted)).
The Plaintiff asserts that the Court should aggregate damages across the entire putative
class and cites a series of out-of-circuit cases that purport to conclude that district courts have been
willing to do so if a defendant’s conduct uniformly impacts the putative class members’ computers.
See, e.g., See, e.g., In re Toys R Us, Inc., Privacy Litig., No. 00-cv-2746, 2001 WL 34517252, at
*11 (N.D. Cal. Oct. 9, 2001); In re Apple & AT&T Antitrust Litig., 596 F. Supp. 2d 1288, 13071308 (N.D. Cal. 2008); Mortensen v. Bresnan Commun., No. 10-cv-13, 2010 WL 5140454, at *7
(D. Mont. Dec. 13, 2010). These cases ignore Second Circuit jurisprudence regarding putative
class actions as well as countervailing out-of-circuit caselaw. See, e.g., Hayes v. Packard Bell,
Nec., 193 F. Supp. 2d 910, 912 (E.D. Tex. 2001) (dismissing CFAA claims in a putative class
action because the named plaintiff is not able to meet the $5,000 statutory damages threshold);
Halperin v. Int'l Web Servs., LLC, 70 F. Supp. 3d 893, 900 (N.D. Ill. 2014) (“The CFAA does not
mention class actions at all in its civil remedy provision, see 18 U.S.C. § 1030(g), which strongly
suggests that, under the anti-aggregation rule, the economic damages claims of absent class
members may not be aggregated.”); Walsh v. Microsoft Corp., 63 F. Supp. 3d 1312, 1320 (W.D.
Wash. 2014) (“Plaintiffs must meet the damages requirement themselves, and cannot rely on
absent members of their putative class. (citing Warth v. Seldin, 422 U.S. 490, 501, 95 S. Ct. 2197,
45 L. Ed. 2d 343 (1975))).
Currently, the Court is unaware of any case in the Second Circuit where a district court
aggregated damages across a putative class in order to meet the CFAA’s statutory threshold.
Additionally, “[t]he Second Circuit has not yet addressed whether losses can be aggregated for
purposes of the CFAA before a class is certified, but it has indicated approval of DoubleClick’s
through exploration of the CFAA.” Bose v. Interclick, Inc., No. 10-civ.-9183, 2011 WL 4343517,
at *6 (S.D.N.Y. Aug. 11, 2011) (citing Register.com, Inc. v. Verio, Inc., 356 F.3d 393, 439-40 (2d
Cir. 2004)). The DoubleClick Court concluded that in order for a plaintiff to “aggregate[ damage
and loss] across victims and over time,” it must be for a “single act.” 154 F. Supp. 2d at 523;
accord Mount v. PulsePoint, Inc., No. 13-civ.-6592, 2016 WL 5080131, at *9 (S.D.N.Y. Aug. 17,
2016) (“This Court has previously held that for purposes of the $5,000 threshold, damages ‘may
only be aggregated across victims and over time for a single act.’” (citing DoubleClick, 154 F.
Supp. 2d at 523)). Therefore, the Court will analyze the CFAA’s $5,000 statutory damages
requirement using the Plaintiff’s individual allegations. See, e.g., Fink v. Time Warner Cable, No.
08-civ.-9628, 2009 WL 2207920, at *4 (S.D.N.Y. July 23, 2009) (analyzing the plaintiff’s claim
and concluding that she did not meet CFAA’s statutory loss requirement).
Further, contrary to the Plaintiff’s contentions, Cablevision’s configuration of the wireless
routers to broadcast the Optimum Public Wi-Fi does not constitute the “same act” and as such,
cannot be aggregated to meet the $5,000 threshold. Turning to the statute itself, the relevant “act”
is defined as follows: “[Whoever] intentionally accesses a computer without authorization or
exceeds authorized access, and thereby obtains information from any protected computer.” 18
U.S.C. § 1030(a)(2)(C).
The Plaintiff alleges that Cablevision “intentionally accessed the
[wireless routers] of Plaintiff and Class members . . . Cablevision made the wireless routers it
provided to Plaintiff and Class members capable of receiving a command to generate public WiFi signals.” Amended Class Action Complaint ¶ 32.
While the Plaintiff did acknowledge that wireless routers individually are combined to
create the Optimum Public Wi-Fi network, see Amended Class Action Complaint ¶ 70, the
Plaintiff fails to allege that wireless routers share information of any sort with each other. As the
DoubleClick Court acknowledged, it is theoretically possible for a “single act” under the statute to
involve multiple computers. See Sachdev v. Singh, No. 16-civ-7114, 2016 WL 768861, at *5
(S.D.N.Y. Feb. 26, 2016) (explaining that DoubleClick requires a plaintiff to demonstrate that a
“single act” caused at least $5,000 in damage (citing DoubleClick, 154 F. Supp. 2d at 523-25)).
“For example, if someone accessed a White House computer and through that computer erased
information on State Department, Central Intelligence Agency, and FBI computers, the value of
these damages and losses could be aggregated for the purposes of meeting [the CFAA’s statutory]
damages threshold.” DoubleClick, 154 F. Supp. 2d at 524 n.32. However, Cablevision is alleged
to have individually accessed the Plaintiff’s wireless router as well as the putative class members’
wireless routers; it has not been alleged that the Defendants obtained information on one putative
class members’ router through another’s router. Therefore, the Plaintiff’s allegation that the entire
Optimum Public Wi-Fi network constitutes a “single act is refuted by the statute’s plain language,”
id. at 524, and the facts at issue.
In the instant case, in the amended complaint, the Plaintiff pleads that all his claims under
the CFAA resulted in the same damage, namely increased electricity costs. Amended Class Action
Complaint ¶¶ 76-78. Given that the Court finds that the Plaintiff is unable to aggregate such
damages, the Plaintiff is unable to demonstrate that the Defendants violated the CFAA in a manner
that has caused the Plaintiff damages or losses of at least $5,000 regarding any CFAA claim.
Therefore, the Court finds that the complaint fails to adequately state a claim for relief
under the CFAA. Accordingly, the Court grants the Defendants’ motion to dismiss the Plaintiff’s
CFAA claims pursuant to Rule 12(b)(6) with prejudice.
E. The State Law Claim
The Plaintiff’s remaining claim is a state law claim that arises under N.Y. Gen. Bus. Law
§ 349. Jensen contends that under 28 U.S.C. § 1332(d), the Court has jurisdiction over such a
claim because “the action involves 100 or more class members; at least one member of the
proposed class is a citizen of a State different from the State of citizenship of Defendants and the
matter in controversy exceeds $5 million in sum or value.” Amended Class Action Complaint ¶
7. The Court finds that the Plaintiff has properly alleged that the parties are minimally diverse and
that the proposed class members’ claims aggregate to exceed the $5,000,000 requirement. See
Standard Fire Ins. Co. v. Knowles, 568 U.S. 588, 592, 133 S. Ct. 1345, 185 L. Ed. 2d 439 (2013)
(explaining the requirements under 28 U.S.C. § 1332(d)).
For the reasons stated above, the Defendants’ motion pursuant to Rule 12(b)(6), to dismiss
the Plaintiff’s CFAA claims is granted. The motion is denied in all other respects.
It is SO ORDERED:
Dated: Central Islip, New York
September 27, 2017
__/s/ Arthur D. Spatt__
ARTHUR D. SPATT
United States District Judge
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