In re Yahoo Mail Litigation

7 F. Supp. 3d 1016, 2014 WL 3962824, 2014 U.S. Dist. LEXIS 112323
CourtDistrict Court, N.D. California
DecidedAugust 12, 2014
DocketCase No.: 5:13-CV-04980
StatusPublished
Cited by88 cases

This text of 7 F. Supp. 3d 1016 (In re Yahoo Mail Litigation) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Yahoo Mail Litigation, 7 F. Supp. 3d 1016, 2014 WL 3962824, 2014 U.S. Dist. LEXIS 112323 (N.D. Cal. 2014).

Opinion

[1020]*1020ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S MOTION TO DISMISS

LUCY H. KOH, United States District Judge

This case involves putative class action claims regarding Defendant Yahoo!, Inc.’s (‘Yahoo”) practice of scanning and analyzing emails of non-Yahoo Mad users in purported violation of federal and California anti-wiretapping laws. Plaintiffs Cody Baker, Brian Pincus, Halima Nobles, and Rebecca Abrams, individually and on behalf of those similarly situated (“Plaintiffs”), allege that Yahoo’s operation of its Yahoo Mail service violates their expectation of privacy under the Electronic Communications Privacy Act (ECPA), California’s Invasion of Privacy Act (CIPA), and the California Constitution. Plaintiffs filed a Consolidated Class Action Complaint on February 12, 2014. ECF No. 35 (“Compl.”). Before the Court is Yahoo’s Motion to Dismiss. ECF No. 37 (“Mot.”). Pursuant to Civil Local Rule T — 1(b), the Court finds this matter appropriate for resolution without a hearing and hereby VACATES the hearing set for August 29, 2014. The Case Management Conference set for August 29, 2014 at 10 a.m. remains as set. For the reasons stated below, the Court DENIES in part and GRANTS in part Yahoo’s Motion to Dismiss.

[1021]*1021I. BACKGROUND

A. Factual Allegations

Plaintiffs are four individuals representing a class of individuals who do not use Yahoo’s email service (“Yahoo Mail”) but have sent emails to Yahoo Mail users from non-Yahoo email addresses. Compl. ¶¶ 15-18. Plaintiffs allege Yahoo’s practices while operating Yahoo Mail violate state and federal anti-wiretapping laws and invade their protected privacy interests under the California Constitution. Id. ¶¶ 5-7. Plaintiffs seek injunctive and declaratory relief and statutory damages on behalf of a class of non-Yahoo Mail users. Id. ¶ 7. Plaintiffs’ proposed class consists of all persons in the United States who are not Yahoo Mail users and who sent emails to or received emails from a Yahoo Mail user between October 2, 2011 and the present. Id. ¶ 97.

1. Yahoo Mail and Yahoo’s Use of Scanned Emails

Yahoo operates Yahoo Mail as a free web-based email service. Id. ¶¶ 20-23. More than 275 million users have registered for Yahoo Mail to create @yahoo.com, @ymail.com, or @rocketmail.com email addresses. Id. ¶¶ 20-21. Before signing up for a Yahoo Mail account, potential users must provide Yahoo with personal information such as their name, birthday, telephone number, and account information. Id. ¶ 31.

In order to provide Yahoo Mail as a free email service to users, Yahoo charges advertisers to display advertisements on Yahoo Mail webpages. Id. ¶ 23. Roughly 75% of Yahoo’s revenue in 2013 came from advertising. Id. ¶ 28. Plaintiffs allege Yahoo can increase its revenues by charging advertisers higher rates to display targeted advertisements to Yahoo Mail users. Id. Thus, Yahoo has a financial incentive to scan and store email content to allow advertisers to target individuals based on certain personal characteristics. Id.

The instant dispute concerns Yahoo’s interception, scanning, and storage of Yahoo Mail users’ incoming and outgoing emails for content, specifically the content of emails to and from non-Yahoo Mail users with whom Yahoo Mail users communicate. Plaintiffs allege Yahoo intercepts and scans Yahoo Mail users’ emails “during transit and before placing the emails into storage.” Id. ¶ 24. Plaintiffs allege Yahoo scans, analyzes, collects, and stores user information without their consent. Id. ¶¶ 1, 3, 5, 26.

2. Yahoo Terms and Privacy Policy

Three relevant agreements exist between Yahoo and Yahoo Mail users: Yahoo Terms of Service (ECF No. 35-1, “TOS”), Yahoo Global Communications Additional Terms of Service for Yahoo Mail and Yahoo Messenger (ECF No. 35-4, “ATOS”), and Yahoo Privacy Policy (ECF No. 35-2). When creating a Yahoo Mail account, Yahoo directs users to view the ATOS and Privacy Policy via hyperlinks. Compl. ¶ 31. The sentence “I agree to the Yahoo Terms and Privacy” appears above the “Create Account” Button.” Id.; see also Mot. at 7. The phrase “Yahoo Terms” links to the ATOS. Compl. ¶ 31. The word “Privacy” is an individual hyperlink to Yahoo’s Privacy Policy. Id. The Complaint does not allege whether “Yahoo Terms” links to the TOS. However, Plaintiffs Opposition concedes that the TOS, ATOS, and Privacy Policy comprise the agreements between Yahoo and its users. ECF No. 39 (“Opp’n”) at 11.

Section 1(c) of the ATOS references Yahoo’s practice of scanning and analyzing users’ email content. Additionally, the ATOS places responsibility on Yahoo Mail users to notify about these scanning policies non-users with whom they communicate. The ATOS in relevant part provides:

[1022]*1022Please note that your Yahoo Messenger account is tied to your Yahoo Mail account. Therefore, your use of Yahoo Messenger and all Yahoo Messenger services will be subject to the TOS and laws applicable to the Applicable Yahoo Company in Section 10. Yahoo’s automated systems scan and analyze all incoming and outgoing communications content sent and received from your account (such as Mail and Messenger content including instant messages and SMS messages) including those stored in your account to, without limitation, provide personally relevant product features and content, to match and serve targeted advertising and for spam and malware detection and abuse protection. By scanning and analyzing such communications content, Yahoo collects and stores the data. Unless expressly stated otherwise, you will not be allowed to opt out of this feature. If you consent to this ATOS and communicate with non-Yahoo users using the Services, you are responsible for notifying those users about this feature.

ATOS § 1(c) (emphasis in original). Plaintiffs allege that Yahoo added the line “By scanning and analyzing such communications content, Yahoo collects and stores the data” “at some time during” the proposed class period. Compl. ¶ 42. The phrase “collects and stores” is a hyperlink that leads the user to a page titled “Yahoo Mail FAQ.” ECF No. 85-7. The FAQ page explains that Yahoo’s scanning technology “looks for patterns, keywords, and files” in users’ emails. Compl. ¶ 47. Yahoo further discloses that it “may anonymously share specific objects from a message with a 3rd party to provide a more relevant experience.” ECF No. 35-7; Compl. ¶ 47.

Yahoo’s TOS and Privacy Policy do not explicitly reference the content of email sent between users and non-users. Instead, the TOS provides:

Registration Data and certain other information about you are subject to our applicable privacy policy. For more information, see the full Yahoo Privacy Policy at http://info.yahoo.com/privacy/ us/yahoo/ ... You understand that through your use of the Yahoo Services you consent to the collection and use (as set forth in the applicable privacy policy) of this information, including the transfer of this information to the United States and/or other countries for storage, processing and use by Yahoo and its affiliates.

TOS § 4. Yahoo’s Privacy Policy also does not explicitly mention email content.

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7 F. Supp. 3d 1016, 2014 WL 3962824, 2014 U.S. Dist. LEXIS 112323, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-yahoo-mail-litigation-cand-2014.