Mendoza v. Microsoft, Inc.

1 F. Supp. 3d 533, 2014 U.S. Dist. LEXIS 27910, 2014 WL 842929
CourtDistrict Court, W.D. Texas
DecidedMarch 5, 2014
DocketCV No. 5:13-CV-378-DAE
StatusPublished
Cited by8 cases

This text of 1 F. Supp. 3d 533 (Mendoza v. Microsoft, Inc.) is published on Counsel Stack Legal Research, covering District Court, W.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mendoza v. Microsoft, Inc., 1 F. Supp. 3d 533, 2014 U.S. Dist. LEXIS 27910, 2014 WL 842929 (W.D. Tex. 2014).

Opinion

ORDER: (1) DENYING PLAINTIFFS’ MOTIONS TO STRIKE DEFENDANT’S NOTICES OF SUPPLEMENTAL AUTHORITY (2) DENYING DEFENDANT’S MOTION TO DISMISS AS MOOT; (S) GRANTING DEFENDANT’S MOTION TO TRANSFER VENUE TO THE WESTERN DISTRICT OF WASHINGTON

DAVID ALAN EZRA, Senior District Judge.

Before the Court are three pending motions: a Motion to Dismiss, or in the alternative, Motion to Transfer Venue to the Western District of Washington filed by Defendant Microsoft Corporation (“Defendant” or “Microsoft”) (Dkt. #3) and two Motions to Strike Defendant’s Notices of Supplemental Authority filed by Plaintiffs Manuel Mendoza, Mathew Mendoza, John Sweeney, Frank Ortega, Dezra Guthrie, and Kaleb McKibben (“Plaintiffs”) (Dkt. # 17; Dkt. # 21). The Court held a hearing on March 4, 2014. Omar W. Rosales, Esq. represented Plaintiffs; Thomas G. Yoxall, Esq. represented Defendant. Upon careful analysis of the supporting and opposing memoranda, as well as the arguments presented at the hearing, the Court DENIES Plaintiffs’ Motions to Strike Defendant’s Notices of Supplemental Authority; DENIES AS MOOT Defendant’s Motion to Dismiss; and GRANTS Defendant’s Motion to Transfer Venue to the Western District of Washington.

BACKGROUND

Defendant Microsoft owns and operates a well-known gaming portal called Xbox LIVE, which provides streaming video via internet access, online gaming services, online video rental services, and online video services. (“Compl.,” Dkt. #1 ¶ 2.) Defendant Microsoft is incorporated in Washington state and has a principal place of business in Redmond, King County, Washington. (Id. ¶ 17.) Plaintiffs are six individuals that were previous subscribers of Xbox LIVE’s service. (Id. ¶¶ 55-60.) They reside in California, Oregon, Florida, Ohio, and Texas.1 (Id. ¶¶ 11-16.)

Plaintiffs admit that they entered into contracts with Defendant Microsoft when they subscribed to its Xbox LIVE service. (Id. ¶¶1, 29-35, 55-60, 97-98.) Before entering into their respective contracts with Microsoft, they were given an opportunity to review Xbox LIVE’s [539]*539“Terms of Use.” (See “Coon Decl.,” Dkt. # 4, Ex. A ¶ 5.)2 The Terms of Use provide, in pertinent part:

1. This is a Contract between You and Microsoft.
18. Choice of Law and Location for Resolving’ Disputes
If this contract is with Microsoft Corporation, then claims for breach of contract will be subject to the laws of the State of Washington, without reference to conflict of laws principles. If this contract is with a Microsoft affiliate, claims for breach of contract will be subject to the laws of the place of incorporation for such Microsoft affiliate, without reference to conflict of laws principles. All other claims, including claims regarding consumer protection laws, unfair competition laws, and in tort, will be subject to the laws of your state of residence in the United States, or, if you reside outside the United States, under the laws of the country to which we direct your Service. If this contract is with Microsoft Corporation, you consent to the exclusive jurisdiction and venue of state and federal courts in King County, Washington, USA for all disputes relating to this contract or the Service. If this contract is with a Microsoft affiliate, you consent to the exclusive jurisdiction and venue of the courts located in the place of incorporation for such Microsoft affiliate for all disputes relating to this contract or the Service. You cannot revoke this consent.

(Dkt. # 4, Ex. A-l ¶¶ 1, 18 (emphasis added).) 3 After being presented with these Terms of Use, Plaintiffs accepted them by clicking “ACCEPT” on the screen.4

Sometime before May 2012, Plaintiffs canceled their Xbox LIVE subscriptions. (Compl. ¶¶ 55-60.) According to Plaintiffs, after they canceled their subscriptions, Microsoft unlawfully retained and disclosed their personal information. (Id. ¶ 1.) They make three claims regarding their canceled subscriptions.

First, they allege that Microsoft retained their names, addresses, credit card information, billing addresses, usernames, passwords, and video programming histories for at least two years after they canceled their respective Xbox LIVE accounts. (Id. ¶ 6.) Plaintiffs also claim that Microsoft improperly stored their consumer information overseas where it is supposedly more vulnerable to a security breach. (Id. ¶ 37.)

[540]*540Second, Plaintiffs allege that Microsoft used their personal information unlawfully: by disclosing and selling it for profit to data mining companies, by using it for advertising and marketing, by sharing it with vendors, and using it to populate Microsoft’s search engine, “Bing.” (Id. ¶¶8-9.)

Third, Plaintiffs contend that Microsoft’s privacy policy is “unclear” and “located piecemeal in various sections of its corporate website and hidden in a third-level webpage not usually seen by consumers.” (Id. ¶¶ 29-36.)

Plaintiffs seek relief under the following statutes: (1) the Video Privacy Protection Act, 18 U.S.C. § 2710; (2) California’s Customer Records Act, Cal. Civ.Code § 1798.80; (3) California’s Unfair Competition Law, Cal. Bus. & Prof.Code § 17200; and (4) Texas’s Deceptive Trade Practices Act, Tex. Bus. & Comm.Code § 17.46(b)(12). (Id. ¶¶ 69-96.)

Shortly after receipt of Plaintiffs’ Complaint, Defendant filed the instant Motion to Dismiss Pursuant to 28 U.S.C. § 1406(a) and Federal Rule of Civil Procedure 12(b)(3), (6) or, in the alternative, to Transfer Venue to the Western District of Washington Pursuant to 28 U.S.C. § 1406(a) or 28 U.S.C. § 1404(a) (“Motion”). (“Mot.,” Dkt. # 3.) Plaintiffs filed a Response opposing any transfer of venue. (“Resp.,” Dkt. # 6.) Defendant filed a Reply. (“Reply,” Dkt. # 9.)

On December 16, 2013, Defendant filed a Notice of Supplemental Authority bringing to the Court’s attention a recent case from the United States Supreme Court, Atlantic Marine Construction Co. v. United States District Court for the Western District of Texas, — U.S. -, 134 S.Ct. 668, 187 L.Ed.2d 487 (2013), which had reversed the Fifth Circuit’s enforcement of forum-selection clauses. (“Supp. Br.,” Dkt. # 16.) In response, Plaintiffs filed a Motion to Strike Defendant’s Supplemental Brief, (Dkt. # 17), to which Defendant filed a Response (Dkt. # 18). Shortly before the hearing, Defendant filed another Notice of Supplemental Authority identifying recent district court opinions discussing the Supreme Court’s decision in Atlantic Marine. (Dkt. # 20.) Plaintiffs responded with another Motion to Strike asserting the same arguments as their previous Motion to Strike. (Dkt. # 21.)

DISCUSSION

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Bluebook (online)
1 F. Supp. 3d 533, 2014 U.S. Dist. LEXIS 27910, 2014 WL 842929, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mendoza-v-microsoft-inc-txwd-2014.