Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 1 of 29 Page ID #:786
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`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`Case No. 2:20-cv-09581-FLA (RAOx)
`
`ORDER GRANTING IN PART AND
`DENYING IN PART DEFENDANTS’
`MOTION TO DISMISS [DKT. 30]
`
`
`
`BURHAAN SALEH,
`
`Plaintiff,
`
`
`
`v.
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`
`
`NIKE, INC., et al.,
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`Defendants.
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`
`
`
`
`
`
`RULING
`Before the court is Defendants Nike, Inc. (“Nike”) and FullStory, Inc.’s
`(“FullStory”) (collectively, “Defendants”) Motion to Dismiss (“Motion”). Dkt. 30
`(Mot.). For the reasons set forth below, the court DENIES Defendants’ Motion as to
`Plaintiff’s claim against Defendant Nike under Cal. Penal Code § 631(a) for aiding
`FullStory’s alleged wiretapping and GRANTS Defendants’ Motion in all other
`respects with leave to amend. Plaintiff shall have fourteen (14) days from the date of
`this order to file an amended complaint.
`/ / /
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 2 of 29 Page ID #:787
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`BACKGROUND
`The following facts are alleged in the First Amended Complaint (“FAC”).
`Plaintiff Burhaan Saleh (“Saleh” or “Plaintiff”) is a California citizen and resident
`living in Glendale, California. Dkt. 24 (FAC) ¶ 4. Nike is an Oregon corporation
`with its principal place of business in Beaverton, Oregon. Id. ¶ 5. FullStory is a
`Delaware corporation with its principal place of business in Atlanta, Georgia. Id. ¶ 8.
`FullStory is a marketing software-as-a-service (“SaaS”) company and provides
`Nike with “Session Replay,” a feature Nike uses on its website to capture data
`regarding visitors to Nike’s website, nike.com (the “Website” or “Nike’s Website”).
`Id. ¶¶ 9, 16-17. Session Replay embeds snippets of code that watch and record, in real
`time, “a visitor’s every move on a website.” Id. ¶ 18. “On Nike’s website,
`FullStory’s software captures, among other things: (a) The user’s mouse clicks; (b)
`The user’s keystrokes; (c) The user’s payment card information, including card
`number, expiration date, and CVV code; (d) The user’s IP address; (e) The user’s
`location at the time of the visit; and (f) The user’s browser type and the operating
`system on their devices.” Id. ¶ 44 (paragraph breaks omitted).
`In May 2020, Plaintiff visited Nike’s Website and completed a purchase. Id.
`¶¶ 2, 40. During Plaintiff’s visit, Defendants Nike and FullStory recorded Plaintiff’s
`electronic communications in real time, including Plaintiff’s mouse clicks, keystrokes,
`and payment card information. Id. Plaintiff was unaware at the time that his
`keystrokes, mouse clicks, and other electronic communications were being intercepted
`in real-time and would be disclosed to FullStory, nor did Plaintiff consent to the same.
`Id. ¶ 4. Nike does not ask users whether they consent to FullStory’s recordation of
`their interactions with Nike’s Website, or inform users of the recording in its Privacy
`Policy. Id. ¶¶ 45, 46.
`Plaintiff initiated this putative class action on October 19, 2020 and filed the
`operative FAC on December 22, 2020. Dkts. 1, 24. Plaintiff brings causes of action
`against Defendants under the California Invasion of Privacy Act (“CIPA”), Cal. Penal
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 3 of 29 Page ID #:788
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`I.
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`Code §§ 631 and 635, and for invasion of privacy under the California Constitution.
`FAC ¶¶ 59-89. Defendants filed a Motion to Dismiss the FAC on January 22, 2021,
`which the court took under submission on April 23, 2021. Dkts. 30 (Mot.), 46.
`MOTION TO DISMISS: PERSONAL JURISDICTION
`Legal Standard
`Under Fed. R. Civ. P. 12(b)(2), a party may file a motion to dismiss a complaint
`for lack of personal jurisdiction. “When a defendant moves to dismiss for lack of
`personal jurisdiction, the plaintiff bears the burden of demonstrating that the court has
`jurisdiction.” In re Western States Wholesale Nat. Gas Antitrust Litig., 715 F.3d 716,
`741 (9th Cir. 2013); accord Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797,
`800 (9th Cir. 2004) (citation omitted).
`“The court may consider evidence presented in affidavits to assist it in its
`determination and may order discovery on the jurisdictional issues.” Doe v. Unocal
`Corp., 248 F.3d 915, 922 (9th Cir. 2001), overruled on other grounds as discussed in
`Williams v. Yamaha Motor Co., 851 F.3d 1015, 1021 (9th Cir. 2017). “However,
`‘when a district court acts on a defendant’s motion to dismiss without holding an
`evidentiary hearing, the plaintiff need make only a prima facie showing of
`jurisdictional facts to withstand the motion to dismiss. That is, the plaintiff need only
`demonstrate facts that if true would support jurisdiction over the defendant.’” Id.
`(quoting Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995)).
`“Where … there is no applicable federal statute governing personal jurisdiction,
`the district court applies the law of the state in which the district court sits.” Id. (citing
`Fed. R. Civ. P. 4(k)(1)(A)). “Personal jurisdiction over a nonresident defendant is
`proper if permitted by a state’s long-arm statute and if the exercise of that jurisdiction
`does not violate federal due process.” Western States, 715 F.3d at 741. California’s
`long-arm statute provides for jurisdiction coextensive with the Constitution of the
`United States. Cal. Code Civ. Proc. § 410.10. “Because California’s long-arm
`jurisdictional statute is coextensive with federal due process requirements, the
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 4 of 29 Page ID #:789
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`jurisdictional analyses under state law and federal due process are the same.”
`Schwarzenegger, 374 F.3d at 800-01. Accordingly, this court’s exercise of personal
`jurisdiction over a non-resident defendant not present in the forum will satisfy due
`process if the defendant has sufficient “minimum contacts” with the forum, such that
`the exercise of jurisdiction “does not offend traditional notions of fair play and
`substantial justice.” Schwarzenegger, 374 F.3d at 801 (quoting Int’l Shoe Co. v.
`Washington, 326 U.S. 310, 316 (1945)).
`II. Discussion
`A. General Personal Jurisdiction
`A district court may exercise either general or specific personal jurisdiction.
`See Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773, 1780 (2017). To
`establish general jurisdiction over a defendant corporation, the plaintiff must
`demonstrate the defendant has sufficient contacts to constitute the kind of “continuous
`and systematic general business contacts” that approximate physical presence in the
`forum state. Schwarzenegger, 374 F.3d at 801 (quoting Helicopteros Nacionales de
`Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984)). For corporations, the place of
`incorporation and principal place of business are “paradigm” examples of continuous
`and systematic general business contacts sufficient to support general personal
`jurisdiction.” Daimler AG v. Bauman, 571 U.S. 117, 137 (2014).
`Defendants argue the court cannot exercise general personal jurisdiction over
`FullStory because FullStory is incorporated in Delaware, has its principal place of
`business in Georgia, FAC ¶ 8, and has not otherwise established continuous and
`systematic contacts in California, such that it is essentially at home in the state. Mot.
`7 (citing BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549, 1559 (2017)). Plaintiff appears to
`concede the argument, as Plaintiff does not respond and argues only that the court has
`specific personal jurisdiction over FullStory. Opp. 2-8. Thus, Plaintiff has not
`established general personal jurisdiction over FullStory, and the court will proceed to
`assess the parties’ arguments regarding specific personal jurisdiction.
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 5 of 29 Page ID #:790
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`B.
`Specific Personal Jurisdiction
`For a court to exercise specific personal jurisdiction over a defendant, “the suit
`must arise out of or relate to the defendant’s contacts with the forum.” Bristol-Myers,
`137 S. Ct. at 1780 (internal brackets and quotation marks omitted). The Ninth Circuit
`has established a three-prong test for analyzing a claim of specific personal
`jurisdiction:
`(1) The non-resident defendant must purposefully direct his activities or
`consummate some transaction with the forum or resident thereof; or perform
`some act by which he purposefully avails himself of the privilege of conducting
`activities in the forum, thereby invoking the benefits and protections of its laws;
`(2) the claim must be one which arises out of or relates to the defendant’s
`forum-related activities; and
`(3) the exercise of jurisdiction must comport with fair play and substantial
`justice, i.e. it must be reasonable.
`Schwarzenegger, 374 F.3d at 802. The plaintiff bears the burden to establish the first
`two prongs, and failure to establish either one requires dismissal for lack of personal
`jurisdiction. Id.
`The first prong of the specific jurisdiction test refers to both “purposeful
`availment” and “purposeful direction.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647
`F.3d 1218, 1228 (9th Cir. 2011). A purposeful availment analysis is most often used
`in suits sounding in contract, while a purposeful direction analysis is most often used
`in suits sounding in tort. Schwarzenegger, 374 F.3d at 802; Mavrix, 647 F.3d at 1228.
`The parties agree the court must apply the purposeful direction analysis here. Mot. 8;
`Opp. 2.
`The purposeful direction test, or “effects test,” looks to whether the defendant:
`(1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing
`harm that the defendant knows is likely to be suffered in the forum state. Mavrix, 647
`F.3d at 1228 (citing Calder v. Jones, 465 U.S. 783 (1984)); Schwarzenegger, 374 F.3d
`at 803. The court will address each factor in turn.
`/ / /
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 6 of 29 Page ID #:791
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`1. Whether FullStory Committed an Intentional Act
`Defendants argue the FAC fails to allege any facts regarding intentional
`conduct by FullStory to create contacts with California sufficient to support the
`exercise of specific personal jurisdiction. Mot. 7-10. Specifically, according to
`Defendants, the FAC does not allege that (1) Nike and FullStory’s licensing
`agreement was negotiated in California, (2) the agreement was entered into in
`California, (3) FullStory developed its software in California, or (4) “FullStory has
`any other suit-related contacts to this forum other than the fact that Plaintiff happened
`to be in California when he visited Nike’s website.” Id. at 8-9.
`Plaintiff responds that his allegations of “wiretapping” satisfy the requirement
`that FullStory purposefully direct itself toward California, including that FullStory
`committed an intentional act. Opp. 2-5. Relying on S.D. v. Hytto Ltd., Case No. 4:18-
`cv-00688-JSW, 2019 U.S. Dist. LEXIS 229909 (N.D. Cal. May 14, 2019), Plaintiff
`argues FullStory “intentionally wiretapped visitors” and, therefore, committed an
`intentional act under the purposeful direction test. Opp. 3.
`In Hytto, 2019 U.S. Dist. LEXIS 229909 at *4, a California plaintiff alleged a
`Hong Kong defendant, a manufacturer of smartphone-connected sex toys,
`“‘continuously and contemporaneously intercept[ed]’ and transmit[ted] to [the
`defendant’s] servers, the date and time of each use of the paired [] device(s), the
`vibration intensity level users select using the app, and the email address of users
`sending and receiving commands.” The court emphasized that, under the purposeful
`direction test, an “intentional act” refers to “an intent to perform an actual, physical
`act in the real world, rather than an intent to accomplish a result or consequence of
`that act.” Id. at *10 (internal quotation marks and citation omitted). As the defendant
`had allegedly purposefully intercepted the plaintiff’s electronic transmissions, the
`Hytto court concluded “the ‘intentional act’ standard [was] easily satisfied ….” Id.
`Defendants respond the term “intentional act” bears a particularized meaning
`not recognized in Hytto and urge the court to follow the Ninth Circuit’s definition of
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 7 of 29 Page ID #:792
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`an “intentional act” in Wash. Shoe Co. v. A-Z Sporting Goods Inc., 704 F.3d 668 (9th
`Cir. 2012). Dkt. 32 (Reply) at 2; see Bergstein v. Parmar, Case No. 2:13-cv-06167-
`DMG (MRWx), 2014 U.S. Dist. LEXIS 195552, at *6 (C.D. Cal. June 23, 2014)
`(citing Wash. Shoe, 704 F.3d at 673). In Washington Shoe, the court explained as
`follows:
`“‘Intentional act’ has a specialized meaning in the context of the
`Calder effects test.” Schwarzenegger, 374 F.3d at 806. We have
`defined an ‘act’ as ‘denot[ing] an external manifestation of the
`actor’s will … not includ[ing] any of its results, even the most
`direct, immediate, and intended.” Id. (“Thus, if the actor, having
`pointed a pistol at another, pulls the trigger, the act is the pulling of
`the trigger and not the impingement of the bullet upon the other’s
`person.” (quoting Restatement (Second) of Torts § 2 & cmt. c
`(1964))). Further, “[w]e construe ‘intent’ … as referring to an intent
`to perform an actual, physical act in the real world, rather than an
`intent to accomplish a result or consequence of that act.” Id.
`Accordingly, an intentional act is an external manifestation of the
`actor’s intent to perform an actual, physical act in the real world, not
`including any of its actual or intended results.
`
`Wash. Shoe Co. 704 F.3d at 674-75.
`With this understanding, the Washington Shoe court had “little difficulty”
`finding the defendant had committed an intentional act when it purchased and sold
`boots that allegedly infringed the plaintiff’s copyright. Id. at 675. Similarly, in
`Bergstein, 2014 U.S. Dist. LEXIS 195552, upon which the Hytto court relied, the
`court found the intentional act requirement was “easily satisfied” where the defendant
`allegedly “recorded [] telephone conversations, extorted [the plaintiff], and released
`some of the recordings.” Id. at *8.
`Defendants argue the present case is distinguishable from Washington Shoe and
`Bergstein because Plaintiff does not allege facts showing the external manifestation of
`FullStory’s will was to record Plaintiff’s activity on the Website. Reply 2 (quoting
`Bergstein, 2014 U.S. Dist. LEXIS 195552, at *7). Defendants emphasize, “[t]here is
`no suggestion, let alone allegation, that this external manifestation was to wiretap an
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 8 of 29 Page ID #:793
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`individual in this forum or even enable Nike to do so.” Id. Rather, Defendants argue,
`FullStory’s intentional acts include (1) developing software and (2) providing its
`software to Nike through a voluntary partnership. Id. (citing FAC ¶¶ 15, 34).
`Defendants conclude the “‘results, even the most direct, immediate, and intended’
`results of the original intent,” cannot support a finding of an intentional act to record
`Plaintiff’s online activity. Id. (quoting Bergstein, 2014 U.S. Dist. LEXIS 195552, at
`*3). The court disagrees.
`Plaintiff alleges FullStory intentionally recorded his activity. FAC ¶¶ 35-36.
`According to the FAC, FullStory “intentionally installed the wiretap at issue here on
`Nike’s Website” and “purposefully intercepted electronic transmissions from users of
`Nike’s website.” Id. ¶ 14; see also id. ¶¶ 64, 76, 84. Plaintiff further alleges that
`“[w]hen the website user’s communications are transmitted to Nike’s Website,
`FullStory records the website user’s interactions locally in the user’s browser in real
`time, and then transmits that information to FullStory’s recording servers every few
`seconds. FullStory then makes the information available to its clients.” Id. ¶ 27.
`Taking these allegations as true, as is required, the court finds Plaintiff has
`successfully alleged FullStory committed intentional acts for purposes of personal
`jurisdiction.
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`2. Whether FullStory Expressly Aimed its Conduct Toward
`California
`Defendants next argue Plaintiff fails to allege FullStory expressly aimed its
`conduct toward California. Mot. 9. Defendants cite Bristol-Myers, 137 S. Ct. at 1781,
`to argue “[t]here must be ‘an adequate link’ between the defendant’s contacts with the
`forum and the claims at issue” for specific personal jurisdiction to exist, and that
`“[c]ontacts unrelated to Plaintiff’s alleged claims will not suffice for specific
`jurisdiction.” Id.
`As stated, Defendants contend the FAC does not allege that (1) Nike and
`FullStory’s licensing agreement was negotiated in California, (2) the agreement was
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 9 of 29 Page ID #:794
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`entered into in California, (3) FullStory developed its software in California, or (4)
`“FullStory has any other suit-related contacts to this forum other than the fact that
`Plaintiff happened to be in California when he visited Nike’s website.” Id. at 8-9.
`According to Defendants, the mere allegation that FullStory entered into a licensing
`agreement to provide software and services to Nike, whose website was available to
`California residents, is not sufficient to show FullStory expressly aimed its conduct
`toward California. Id.
`Plaintiff responds that FullStory’s online activity is sufficient to show FullStory
`expressly aimed its conduct toward California. Opp. 3-5. Plaintiff relies on several
`district court cases in which courts found the defendants’ websites had sufficient
`“interactivity” with the forum state, and that the defendants engaged in other
`additional acts toward the forum state, for the courts to exercise personal jurisdiction
`over the defendants. Opp. 4 (citing Oakley, Inc. v. Donofrio, Case No. 8:12-cv-
`02191-CJC (RNBx), 2013 U.S. Dist. LEXIS 198264 (C.D. Cal. June 14, 2013) and
`Loomis v. Slendertone Distribution, Inc., 420 F. Supp. 3d 1046, 1069 (S.D. Cal.
`2019)).
`The Ninth Circuit has explained, “[n]ot all material placed on the Internet is,
`solely by virtue of its universal accessibility, expressly aimed at every state in which it
`is accessed.” Mavrix, 647 F.3d at 1231. In the context of specific personal
`jurisdiction, “maintenance of a passive website alone cannot satisfy the express
`aiming prong.” Id. at 1229 (internal quotation marks and citation omitted). However,
`“operating even a passive website in conjunction with ‘something more’—conduct
`directly targeting the forum—is sufficient.” Id. (quoting Rio Props., Inc. v. Rio Int’l
`Interlink, 284 F.3d 1007, 1020 (9th Cir. 2002)). In determining whether a nonresident
`defendant has done “something more,” the Ninth Circuit has considered several
`factors, including, among others not relevant here, the interactivity of the defendant’s
`website, the geographic scope of the defendant’s commercial ambitions, and whether
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 10 of 29 Page ID #:795
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`the defendant “individually targeted” a plaintiff known to be a forum resident. Id.
`(citations omitted).
`In Oakley, on which Plaintiff relies, the out-of-state defendants sold products on
`eBay to California residents, but the defendant corporation was not incorporated in
`California and the defendants did not operate their business there. Oakley, 2013 U.S.
`Dist. LEXIS 198264, at *4-5, 19. The defendants challenged the court’s exercise of
`personal jurisdiction on the grounds the defendants had not specifically targeted the
`California market and only sold products to California residents with “little or no
`control” over whether California residents would purchase their items. Id. at *12.
`The Oakley court began its “expressly aimed” analysis with the holdings of
`Mavrix and Washington Shoe, that an Internet presence alone was not sufficient to
`establish conduct that was expressly aimed at the forum state, and “something more”
`was necessary. Id. at *18-19. The court concluded there were at least two reasons
`why the Oakley defendants had done “something more” than simply operate an online
`store to which California residents had access. Id. at *19. First, the defendants “all
`interacted with California consumers by accepting orders from those consumers
`through eBay and shipping products to consumers in California.” Id. Specifically,
`they “actively conducted transactions with California customers, accepted payment
`from those customers, and shipped products into California.” Id. Second, the
`defendants “engaged in wrongful conduct targeted at a plaintiff whom the defendant
`knows to be a resident of the forum state.” Id. at *20 (quoting Wash. Shoe, 704 F.3d
`at 675) (internal quotation marks omitted). Similarly, in Loomis, the court concluded
`the defendant had expressly aimed its conduct toward California because, among other
`things, the defendant maintained an interactive website available to California
`residents, exploited the California advertising market, sold products through the
`website to California residents, and exchanged information with users in California.
`Loomis, 420 F. Supp. 3d at 1069-70.
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 11 of 29 Page ID #:796
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`According to Plaintiff, Nike is a commercial website that is available to, and
`sells to, California residents in the same manner as in Oakley and Loomis. Opp. 5;
`FAC ¶¶ 4, 14. Thus, Plaintiff contends, FullStory—operating on Nike’s website—
`expressly aimed its conduct toward California. Opp. 5. Defendants respond Oakley
`and Loomis are distinguishable because, unlike in those and other similar cases,
`Plaintiff does not allege FullStory itself operated a website accessible to California
`residents such as Plaintiff; rather, Plaintiff alleges Nike operated the Website and
`FullStory’s software was embedded therein. Reply 3; FAC ¶ 18. Defendants explain,
`“[i]n each internet-based case Plaintiff cites on this point, the Court addressed whether
`a website operator, not a company who supplied software to the website operator, was
`subject to personal jurisdiction.” Reply 3 (emphasis in original). The court agrees
`with Defendants.
`Here, unlike in Oakley, Plaintiff does not allege that FullStory accepts orders or
`payments from California customers, that FullStory ships goods to California
`customers, or that California residents interact with FullStory links or features.
`Plaintiff instead alleges FullStory “recorded Plaintiff’s electronic communications in
`real time, including Plaintiff’s mouse clicks, keystrokes, and payment card
`information.” Id. ¶ 2; see also id. ¶¶ 4, 17-19, 23, 25, 27, 31, 41-44. As alleged in the
`FAC, users do not provide order information to FullStory, conduct business with
`FullStory, or otherwise interact with FullStory by clicking on FullStory links or
`features, nor does FullStory facilitate Nike’s transactions with California customers.
`Cf. Loomis, 420 F. Supp. 3d at 1070; Oakley, 2013 U.S. Dist. LEXIS 198264, at *19;
`j2 Cloud Servs. v. Fax87, Case No. 2:13-cv-05353-DDP (AJWx), 2017 U.S. Dist.
`LEXIS 64064, at *20 (C.D. Cal. Apr. 27, 2017). While the FAC alleges FullStory is a
`“marketing software-as-a-service (‘SaaS’) company, FAC ¶ 9, Plaintiff does not
`allege FullStory provides its services to California companies or plead other facts
`sufficient to demonstrate it “expressly aimed” conduct to this forum. See Mavrix, 647
`F.3d at 1231. Plaintiff’s cited cases, therefore, are distinguishable.
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 12 of 29 Page ID #:797
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`Defendants further argue it is “not enough” for Plaintiff to allege FullStory
`“constructively” knew some of Nike’s customer base was in California. Id. at 9; FAC
`¶ 14. According to Defendants, that the FAC alleges Californians form a significant
`portion of Nike’s customer base “shows nothing” about whether FullStory has
`“actively and affirmatively” transacted with California customers or “conducted
`regular business” with California citizens. Reply 3 (quoting Oakley, 2013 U.S. Dist.
`LEXIS 198264, at *15-16). Plaintiff, meanwhile, argues it is sufficient to allege
`FullStory was aware Nike had a substantial customer base in California and that it was
`foreseeable FullStory’s services would be used to record California users. Opp. 3-4.
`Plaintiff, however, cites no authority for the proposition that a defendant’s unilateral
`observation of a user’s interaction with a third party’s website is sufficient to find the
`defendant “interacted” with the user for purposes of personal jurisdiction. Because
`the court concludes Plaintiff has failed to allege facts showing FullStory expressly
`aimed its conduct toward California, the court need not consider the parties’
`remaining arguments regarding foreseeability and the other specific personal
`jurisdiction prongs. As Plaintiff has failed to allege facts sufficient to show the court
`may exercise personal jurisdiction over FullStory, the court restricts its analysis of
`Defendants’ Motion to whether Plaintiff has stated claims against Defendant Nike.
`MOTION TO DISMISS: FAILURE TO STATE A CLAIM
`Legal Standard
`Under Fed. R. Civ. P. 12(b)(6), a party may file a motion to dismiss a complaint
`for “failure to state a claim upon which relief can be granted.” The purpose of Rule
`12(b)(6) is to enable defendants to challenge the legal sufficiency of the claims
`asserted in a complaint. Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729, 738
`(9th Cir. 1987). A district court properly dismisses a claim under Rule 12(b)(6) if the
`complaint fails to allege sufficient facts “to support a cognizable legal theory.” Caltex
`Plastics, Inc. v. Lockheed Martin Corp, 824 F.3d 1156, 1159 (9th Cir. 2016).
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`I.
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`Case 2:20-cv-09581-FLA-RAO Document 71 Filed 09/27/21 Page 13 of 29 Page ID #:798
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`“To survive a motion to dismiss, a complaint must contain sufficient factual
`matter … to ‘state a claim for relief that is plausible on its face.’” Ashcroft v. Iqbal,
`556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
`(2007)). “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not
`need detailed factual allegations, a plaintiff’s obligation to provide the ‘grounds’ of
`his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic
`recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555
`(internal citations omitted). “Factual allegations must be enough to raise a right to
`relief above the speculative level.” Id. (internal citations omitted). “Determining
`whether a complaint states a plausible claim for relief is ‘a context-specific task that
`requires the reviewing court to draw on its judicial experience and common sense.’”
`Ebner v. Fresh, Inc., 838 F.3d 958, 963 (9th Cir. 2016) (quoting Iqbal, 556 U.S. at
`679).
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`When evaluating a complaint under Rule 12(b)(6), the court “must accept all
`well-pleaded material facts as true and draw all reasonable inferences in favor of the
`plaintiff.” Wilson v. Hewlett–Packard Co., 668 F.3d 1136, 1140 (9th Cir. 2012).
`Legal conclusions, however, “are not entitled to the assumption of truth” and “must be
`supported by factual allegations.” Iqbal, 556 U.S. at 679. A court must normally
`convert a Rule 12(b)(6) motion into a Rule 56 motion for summary judgment if it
`considers evidence outside the pleadings. United States v. Ritchie, 342 F.3d 903, 907-
`08 (9th Cir. 2003). “A court may, however, consider certain materials—documents
`attached to the complaint, documents incorporated by reference in the complaint, or
`matters of judicial notice—without converting the motion to dismiss into a motion for
`summary judgment.” Id.
`II. Cal. Penal Code § 631
`Plaintiff’s first claim for relief is under Cal. Penal Code § 631(a) (“§ 631(a)”).
`FAC ¶¶ 59-72. Section 631(a) provides, in relevant part:
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`Any person . . . [1] who willfully and without the consent of all
`parties to the communication, or in any unauthorized manner, reads,
`or attempts to read, or to learn the contents or meaning of any
`message, report, or communication while the same is in transit or
`passing over any wire, line, or cable, or is being sent from, or
`received at any place within this state; or [2] who uses, or attempts
`to use, in any manner, or for any purpose, or to communicate in any
`way, any information so obtained, or [3] who aids, agrees with,
`employs, or conspires with any person or persons to unlawfully do,
`or permit, or cause to be done any of the acts or things mentioned
`above in this section, is punishable by a fine not exceeding two
`thousand five hundred dollars ($2,500), or by imprisonment in the
`county jail not exceeding one year, or by imprisonment pursuant to
`subdivision (h) of Section 1170, or by both a fine and imprisonment
`in the county jail or pursuant to subdivision (h) of Section 1170.”
`Cal. Penal Code § 631(a).
`A private party may bring a claim for a violation of § 631(a) pursuant to Cal.
`Penal Code § 637.2, which provides that “[a]ny person who has been injured by a
`violation of this chapter may bring an action against the person who committed the
`violation....” Section 631(a) contains an exemption from liability for a person who is
`a “party” to a communication, where a party to a communication cannot be held to
`wiretap another party to the same communication. Davis v. Facebook, Inc. (In re
`Facebook Inc. Internet Tracking Litig.), 956 F.3d 589, 607 (9th Cir. 2020) (citing
`Warden v. Kahn, 99 Cal. App. 3d 805, 811 (1979)).
`A. Whether Nike’s Privacy Policy Precludes Plaintiff’s Claims
`Defendants argue Nike disclosed FullStory’s alleged interception to Plaintiff in
`its Privacy Policy and, therefore, Plaintiff cannot state a claim under § 631. Mot. 17-
`19; Reply 11-12. To support their argument, Defendants rely on a version of the
`Privacy Policy that they represent was “last modified” on October 12, 2020. Mot. 18.
`Defendants cite Garcia v. Enterprise Holdings, Inc., 78 F. Supp. 3d 1125, 1137 (N.D.
`Cal. 2015), to argue that courts in the Ninth Circuit routinely consider website privacy
`policies at the motion to dismiss stage, where, as here, the plaintiff refers to the
`privacy policy in the complaint. Mot. 18 n.4.
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`Unlike in Garcia, however, Defendants have not submitted a request for
`judicial notice or request for incorporation by referen