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`PURVI G. PATEL (CA SBN 270702)
`PPatel@mofo.com
`NICOLE V. OZERAN (SBN 302321)
`NOzeran@mofo.com
`JOVANNA RENEE BUBAR (CA SBN 329277)
`JBubar@mofo.com
`MORRISON & FOERSTER LLP
`707 Wilshire Boulevard
`Los Angeles, California 90017-3543
`Telephone: 213.892.5200
`Facsimile: 213.892.5454
`
`Attorneys for Defendant
`QUANTUM METRIC, INC.
`
`ANGELA CHRISTINE AGRUSA (CA SBN 131337)
`Angela.agrusa@us.dlapiper.com
`DAVID B. FARKAS (CA SBN 257137)
`David.farkas@us.dlapiper.com
`DLA PIPER LLP (US)
`2000 Avenue of the Stars Suite 400
`Los Angeles, CA 90067-4704
`Tel. 310.595.3000
`Fax 310.595.3300
`
`Attorneys for Defendant
`LULULEMON USA INC.
`
`UNITED STATES DISTRICT COURT
`
`CENTRAL DISTRICT OF CALIFORNIA
`
`MARY YOON, individually and on
`behalf of all others similarly situated,
`
`Plaintiff,
`
`v.
`
`LULULEMON USA INC. and
`QUANTUM METRIC, INC.,
`
`Defendants.
`
`Case No. 5:20-cv-02439-JWH-SHK
`
`DEFENDANTS’ NOTICE OF
`MOTION AND MOTION TO
`DISMISS PLAINTIFF’S SECOND
`AMENDED CLASS ACTION
`COMPLAINT; MEMORANDUM
`OF POINTS AND AUTHORITIES
`IN SUPPORT
`
`Date: October 29, 2021
`Time:
`9:00 a.m.
`Judge: Hon. John W. Holcomb
`Ctrm:
`2
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`Complaint filed: Nov. 19, 2020
`SAC filed: July 29, 2021
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`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 2 of 34 Page ID #:518
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`NOTICE OF MOTION AND MOTION TO DISMISS
`PLEASE TAKE NOTICE that on October 29, 2021, at 9:00 a.m., or as soon
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`thereafter as the matter may be heard, in Courtroom 2 of this Court, located at 3470
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`Twelfth Street, Riverside, California 92501, Defendants Lululemon USA, Inc. and
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`Quantum Metric, Inc. will and hereby do move this Court, pursuant to Federal Rule
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`of Civil Procedure 12(b)(6), for an order dismissing Plaintiff’s Second Amended
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`Class Action Complaint with prejudice because Plaintiff fails to state any claim for
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`relief under the California Invasion of Privacy Act or for common law invasion of
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`privacy.
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`This motion is based on this Notice; the accompanying Memorandum of
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`Points and Authorities, Request for Judicial Notice, Declaration of Nicole V.
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`Ozeran, Declaration of Angela C. Agrusa, the pleadings, files, and records in this
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`action; and such additional evidence and arguments as may be presented to the
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`Court.
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`This motion is made following a conference of counsel pursuant to Local
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`Rule 7-3, which took place on August 18, 2021. (Declaration of Nicole V. Ozeran
`
`¶ 2; Declaration of Angela C. Agrusa ¶ 2.)
`
`Dated: August 27, 2021
`
`
`MORRISON & FOERSTER LLP
`
`
`
`By: /s/ Purvi G. Patel
`
` Purvi G. Patel
`Attorneys for Defendant
`Quantum Metric, Inc.
`
`
`
`
`
`Dated: August 27, 2021
`
`DLA PIPER LLP (US)
`
`By: /s/ Angela Christine Agrusa
` Angela Christine Agrusa
`Attorneys for Defendant
`Lululemon USA, Inc.
`
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`1
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 3 of 34 Page ID #:519
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`TABLE OF CONTENTS
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`
`Page
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`
`
`
`INTRODUCTION ........................................................................................... 1
`I.
`SUMMARY OF ARGUMENT ...................................................................... 2
`II.
`III. BACKGROUND ............................................................................................. 3
`A. Allegations Related to Plaintiff Yoon ................................................... 3
`B.
`How Quantum’s Platform Works ......................................................... 4
`IV. LEGAL STANDARD ..................................................................................... 6
`V. ARGUMENT .................................................................................................. 7
`A.
`Plaintiff Fails to State a Claim Under CIPA § 631(a) .......................... 7
`1.
`Quantum was a participant to the communication ..................... 7
`2.
`Plaintiff fails to state a claim under CIPA § 631(a)(i) ............. 10
`3.
`Plaintiff fails to state a claim under CIPA § 631(a)(ii) ............ 13
`4.
`Plaintiff’s aiding and abetting claims against Lululemon
`under CIPA § 631(a)(iv) should be dismissed for failure
`to allege a predicate violation ................................................... 18
`Plaintiff Fails to State a Claim for Common Law Invasion of
`Privacy / Intrusion ............................................................................... 18
`1.
`Plaintiff does not demonstrate a reasonable expectation of
`privacy in the allegedly captured information .......................... 19
`The alleged intrusion did not occur in a manner highly
`offensive to a reasonable person ............................................... 23
`Leave to Amend Should Not be Granted Again ................................. 24
`C.
`VI. CONCLUSION ............................................................................................. 25
`
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`B.
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`2.
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 4 of 34 Page ID #:520
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`TABLE OF AUTHORITIES
`
` Page(s)
`
`Cases
`
`Ashcroft v. Iqbal,
`556 U.S. 662 (2009) .............................................................................. 6, 7, 16, 24
`
`Bell Atl. Corp. v. Twombly,
`550 U.S. 544 (2007) .............................................................................................. 7
`
`Brodsky v. Apple Inc.,
`445 F. Supp. 3d 110 (N.D. Cal. 2020)................................................................... 7
`
`Cardoso v. Whirlpool Corp.,
`No. 21-CV-60784-WPD, 2021 WL 2820822 (S.D. Fla. July 6,
`2021) .............................................................................................................. 13, 15
`
`Cline v. Reetz-Laiolo,
`329 F. Supp. 3d 1000 (N.D. Cal. 2018)................................................................. 7
`
`Connor v. Whirlpool Corp.,
`No. 21-CV-14180-WPD, 2021 WL 3076477 (S.D. Fla. July 6,
`2021) .............................................................................................................. 13, 15
`
`Devore v. Dominguez,
`No. CV-1506291-JAK (DFM), 2020 WL 7223261 (C.D. Cal. Sept.
`15, 2020) .............................................................................................................. 25
`
`Durham v. Prudential Ins. Co. of Am.,
`236 F. Supp. 3d 1140 (C.D. Cal. 2017) ............................................................... 15
`
`Eichenberger v. ESPN, Inc.,
`876 F.3d 979 (9th Cir. 2017) ................................................................................. 6
`
`In re Facebook Internet Tracking Litig. (Facebook II),
`263 F. Supp. 3d 836 (N.D. Cal. 2017)................................................................. 22
`
`In re Facebook, Inc. Internet Tracking Litig. (Facebook III),
`956 F.3d 589 (9th Cir. 2020) ................................................................... 19, 21, 23
`
`Folgelstrom v. Lamp Plus, Inc.,
`195 Cal. App. 4th 986 (2011) .............................................................................. 24
`
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 5 of 34 Page ID #:521
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`
`Gardner v. Martino,
`563 F.3d 981 (9th Cir. 2009) ............................................................................... 25
`
`In re Google Assistant Priv. Litig.,
`457 F. Supp. 3d 797 (N.D. Cal. 2020)........................................................... 11, 12
`
`In re Google Location Hist. Litig.,
`428 F. Supp. 3d 185 (N.D. Cal. 2019)........................................................... 20, 21
`
`In re Google, Inc. Privacy Policy Litig.,
`58 F. Supp. 3d 968 (N.D. Cal. 2014) ................................................................... 24
`
`Graham v. Noom, Inc.,
`No. 20-cv-06903-LB, 2021 WL 1312765 (N.D. Cal. Apr. 8, 2021)............... 9, 18
`
`Graham v. Noom, Inc.,
`No. 20-CV-06903-LB, 2021 WL 3602215 (N.D. Cal. Aug. 13,
`2021) ............................................................................................................. passim
`
`Heeger v. Facebook, Inc.,
`509 F. Supp. 3d 1182 (N.D. Cal. 2020)................................................... 19, 20, 21
`
`Hernandez v. Hillsides, Inc.,
`47 Cal. 4th 272 (2009) ................................................................................... 20, 23
`
`Jacome v. Spirit Airlines Inc.,
`No. 2021-000947-CA-01, 2021 WL 3087860 (Fla. Cir. Ct. June 17,
`2021) ........................................................................................................ 13, 15, 16
`
`Javier v. Assurance IQ, LLC,
`No. 20-cv-02860-JSW, 2021 WL 3669343 (N.D. Cal. Aug. 6,
`2021) .................................................................................................................... 25
`
`Joffe v. Google, Inc.,
`746 F.3d 920 (9th Cir. 2013) ............................................................................... 13
`
`Johnson, v. Blue Nile, Inc.,
`No. 20-CV-08183-LB, 2021 WL 3602214 (N.D. Cal. Aug. 13,
`2021) (appeal filed Aug. 23, 2021) .............................................................. passim
`
`Konop v. Hawaiian Airlines, Inc.,
`302 F.3d 868 (9th Cir. 2002) ............................................................................... 16
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 6 of 34 Page ID #:522
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`Lopez v. Smith,
`203 F.3d 1122 (9th Cir. 2000) ............................................................................. 25
`
`Low v. LinkedIn Corp.,
`900 F. Supp. 2d 1010 (N.D. Cal. 2012)............................................................... 24
`
`Mastel v. Miniclip SA,
`No. 2:21-cv-00124 WBS KJN, 2021 WL 2983198 (E.D. Cal. July
`15, 2021) ............................................................................................ 11, 12, 13, 16
`
`Matera v. Google Inc.,
`No. 15-CV-04062-LHK, 2016 WL 8200619 (N.D. Cal. Aug. 12,
`2016) .................................................................................................................... 11
`
`McCoy v. Alphabet, Inc.,
`No. 20-cv-05427-SVK, 2021 WL 405816 (N.D. Cal. Feb. 2, 2021) ............ 22, 24
`
`McGlinchy v. Shell Chem. Co.,
`845 F.2d 802 (9th Cir. 1988) ................................................................................. 6
`
`Membrila v. Receivables Performance Mgmt., LLC,
`No. 09-cv-2790, 2010 WL 1407274 (S.D. Cal. Apr. 6, 2010) .............................. 8
`
`Opperman v. Path,
`205 F. Supp. 3d 1064 (N.D. Cal. 2016)............................................................... 21
`
`Revitch v. New Moosejaw, LLC,
`No. 18-cv-06827-VC, 2019 WL 5485330 (N.D. Cal. Oct. 23, 2019) ............ 9, 11
`
`Ribas v. Clark,
`38 Cal. 3d 355 (1985) ............................................................................................ 9
`
`Rogers v. Ulrich,
`52 Cal. App. 3d 894 (1975) ................................................................................... 8
`
`Safari Club Int’l v. Rudolph,
`862 F.3d 1113 (2017) .......................................................................................... 23
`
`SEC v. McCarthy,
`322 F.3d 650 (9th Cir. 2003) ............................................................................... 12
`
`Sheski v. Shopify (USA) Inc.,
`No. 19-cv-06858-HSG, 2020 WL 2474421 (N.D. Cal. May 13,
`2020) .................................................................................................................... 21
`
`
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 7 of 34 Page ID #:523
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`Sprewell v. Golden State Warriors,
`266 F.3d 979 (9th Cir. 2001) ................................................................................. 5
`
`Svenson v. Google Inc.,
`65 F. Supp. 3d 717 (N.D. Cal. 2014) ................................................................... 14
`
`Touma v. Eeoc,
`No. SACV 19-2412-VBF (KS), 2020 WL 2332171 (C.D. Cal. Jan.
`9, 2020) ................................................................................................................ 18
`
`Watson v. Old Dominion Freight Line Inc.,
`No. 2:20-cv-08018-JWH-JPRx, 2020 WL 10357171 (C.D. Cal.
`Oct. 30, 2020) (Holcomb, J.) ............................................................................... 25
`
`Yale v. Clicktale, Inc.,
`No. 20-CV-07575-LB, ECF No. 48 (decided Aug. 24, 2021) ..................... passim
`
`In re Zynga Privacy Litig.,
`750 F.3d 1098 (9th Cir. 2014) ................................................................. 14, 15, 21
`
`Statutes
`
`Federal Rule of Civil Procedure 12(b)(6) ................................................................... 6
`
`Cal. Penal Code § 631(a) ................................................................................... passim
`
`Cal. Penal Code § 631(a)(i) ...................................................................... 2, 10, 11, 12
`
`Local Rule 5-4.3.4 .................................................................................................... 26
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 8 of 34 Page ID #:524
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`MEMORANDUM OF POINTS AND AUTHORITIES
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`I.
`
`INTRODUCTION
`This is Plaintiff’s third attempt to convert Defendant Lululemon USA, Inc.’s
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`innocuous use of a ubiquitous web analytics tool into illegal “eavesdropping.” This
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`case—like the many identical cases brought by Plaintiff’s counsel against other
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`businesses—involves the use of “session replay,” which helps website operators
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`like Lululemon understand and improve how their websites function. Defendant
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`Quantum Metric, Inc. is Lululemon’s service provider, and the information it
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`allegedly captured from Plaintiff was at Lululemon’s direction for Lululemon’s use
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`only. As other courts have recognized, there is no “wiretap” under these facts.
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`
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`Moreover, Plaintiff alleges no facts supporting the notion that there is any
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`eavesdropping or invasion of privacy in light of the manner in which her alleged
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`interactions with Lululemon’s website were captured. Consistent with her
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`purported expectations, she only “communicated” with Lululemon. There is no
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`way for Quantum to personally identify Plaintiff by reviewing the collected data.
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`Any personally identifying information captured by Quantum’s session replay tool
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`is pseudonymized and encrypted field by field before leaving a user’s device (e.g.,
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`computer). As such, only Lululemon, to whom Plaintiff willingly provided her
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`information, can decrypt the data and potentially identify her.
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`Despite having the benefit of Defendants’ two prior motions to dismiss and
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`this Court’s July 15, 2021 Order (ECF No. 31), Plaintiff fails to state a claim.
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`Indeed, Plaintiff made only limited changes to her largely dismissed First Amended
`Complaint.1 The allegations she adds do not support her remaining claims under
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`Section 631 of the California Invasion of Privacy Act or for invasion of
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`privacy/intrusion (which she now pleads as a common law claim). At bottom, this
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`1 For the Court’s reference, a redline showing the changes between Plaintiff’s
`First and Second Amended Complaints is attached as Exhibit I to the Declaration of
`Nicole V. Ozeran (“Ozeran Decl.”).
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`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`case is about a retailer monitoring activity on its own website using routine web
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`analytics software. Plaintiff has pushed her novel theory—that a company
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`“recording” its own interactions with customers through its website has engaged in
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`wiretapping—far enough. Her claims should be dismissed with prejudice.
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`II.
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`SUMMARY OF ARGUMENT
`Plaintiff asserts two causes of action in her Second Amended Complaint:
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`(1) violation of CIPA § 631(a) and (2) common law invasion of privacy/intrusion.
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`Neither of these claims should be permitted to proceed.
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`Plaintiff’s CIPA Claim. Plaintiff’s claims under each of the “subsections”—
`(i), (ii), and (iv)—of CIPA § 631(a) fail.2 As an initial matter, a participant to a
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`conversation cannot “eavesdrop” on the conversation and therefore cannot violate
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`CIPA § 631(a). Recent orders dismissing nearly identical cases with prejudice
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`support the conclusion that Quantum is a participant to Lululemon’s and Plaintiff’s
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`“communications” as an extension of Lululemon even if it “stores” or “interprets”
`collected data.3
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`Moreover, Plaintiff’s CIPA § 631(a)(i) claim fails because Quantum’s
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`platform does not tap or connect to any “telegraph or telephone” wires, lines,
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`cables, or instruments and Quantum was authorized by Lululemon to embed its
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`session replay script on Lululemon’s website. Plaintiff’s CIPA § 631(a)(ii) claim
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`fails because she does not allege Quantum’s platform captured anything different
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`from or in addition to what she alleged in the First Amended Complaint, which this
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`Court concluded does not constitute the “contents” of a communication. (See July
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`2 Defendants adopt the Court’s separation of CIPA § 631(a) into subdivisions.
`(See July 15 Order at 7:14-8:11.)
`3 See Yale v. Clicktale, Inc., No. 20-CV-07575-LB, ECF No. 48, at 1-2 (decided
`Aug. 24, 2021) (dismissing with prejudice because session replay provider “is not
`an outsider [to the communication] and instead is a software vendor that provides a
`service that allows Gap to analyze its own data”); Graham v. Noom, Inc., No. 20-
`CV-06903-LB, 2021 WL 3602215, at *1-2 (N.D. Cal. Aug. 13, 2021) (same);
`Johnson, v. Blue Nile, Inc., No. 20-CV-08183-LB, 2021 WL 3602214, at *1-2
`(N.D. Cal. Aug. 13, 2021) (appeal filed Aug. 23, 2021) (same).
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 10 of 34 Page ID #:526
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`15 Order at 13:3-6.) And, it would be impossible for Quantum to “read[], attempt[]
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`to read, or to learn” the “contents” of the captured communications “in transit”
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`because they are encrypted and pseudonymized on the user’s browser or collected
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`as de-identified information before being transferred off of the user’s device. (Id. at
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`7:21-8:3.) Finally, because Plaintiff fails to state a claim under subsections (i) or
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`(ii), her claim for aiding and abetting under § 631(a)(iv) necessarily fails.
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`Plaintiff’s Invasion of Privacy Claim. The elements of Constitutional and
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`common law invasion of privacy claims overlap significantly, and courts often
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`evaluate the two claims under the same test. As such, Plaintiff’s common law
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`claim fails, in part, for the same reason that the Court dismissed her Constitutional
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`claim. Further, Plaintiff continues to fail to plead a reasonable expectation of
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`privacy in the information Quantum’s platform allegedly captured, because:
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`(1) Quantum’s platform collects data only while a user is on Lululemon’s website;
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`(2) the information is not sensitive or confidential; and (3) Lululemon discloses the
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`practice in its Privacy Policy. Additionally, Plaintiff’s claim fails because she
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`pleads no facts to support her conclusory statement that the data was collected in a
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`“highly offensive” manner.
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`III. BACKGROUND
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`A. Allegations Related to Plaintiff Yoon
`Plaintiff Mary Yoon is a California resident who alleges that in or about
`August 2020 she visited Lululemon’s website and made a purchase.4 (Second
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`Amended Complaint (“SAC”) ¶ 4, ECF No. 32.) Plaintiff alleges that her mouse
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`clicks and scrolls, keystrokes, and pages viewed while browsing and purchasing
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`jogger pants constitute “communications” with Lululemon. (Id. ¶¶ 4, 46-48.) She
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`further alleges that these communications were “intercepted in real time” by
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`4 This is a departure from the Complaint and FAC, where Plaintiff alleged she
`visited Lululemon’s website in April 2020. (See ECF No. 1 ¶ 2; ECF No. 20 ¶ 2.)
`It is unclear whether this change in date is due to an error or if the August 2020
`visit alleged in the SAC is a different visit.
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`
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`3
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 11 of 34 Page ID #:527
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`Quantum through a “wiretap.” (Id.) Plaintiff does not allege that Quantum did
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`anything with her “communications” other than make them available to Lululemon
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`(the very entity with which Plaintiff directly interacted). She does not allege that
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`Quantum stored or interpreted this information, that Quantum or Lululemon sold or
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`disclosed her “communications” to any third parties, or that she was injured or
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`otherwise affected in any way by the alleged conduct. Nonetheless, she asserts
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`claims for violation of § 631(a) of the California Invasion of Privacy Act and for
`invasion of privacy/intrusion under California common law. (SAC ¶¶ 77-101.)5
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`B. How Quantum’s Platform Works
`Quantum’s platform allows companies to understand a customer’s experience
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`on their websites. (SAC ¶ 17.) Companies use Quantum’s platform to, for
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`example, (1) discover and resolve technical issues on their websites that frustrate
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`customers and impact their ability to complete their intended transactions, (2) assist
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`customers with customer service requests, and (3) respond to customer feedback.
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`(Request for Judicial Notice (“RJN”), Ex. A at 8 (Abstract); SAC ¶ 20.) Quantum
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`thus helps companies identify what works and what does not on their websites, and
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`ensure a better user experience for anyone visiting their websites.
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`Quantum’s platform does not record the user, as Plaintiff alleges, or provide
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`anyone other than the website owner with access to personally identifiable
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`information. The platform uses “millisecond-level chunks of data” to reconstruct a
`customer’s experience during a visit to a company’s website. (RJN Ex. E at 84.)6
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`But the reconstruction is just that—a reconstruction, not a recording. This
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`reconstruction (i.e., session replay) can display de-identified “mouse movements,
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`scrolling” and “errors and events” such as a link that does not work or an error code
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`5 Plaintiff has not re-pled her CIPA § 635 and Federal Wiretap Act claims.
`6 This language comes from a blog post on Quantum’s website from which
`Plaintiff quotes but does not cite. (See SAC ¶ 18; RFJ, Ex. E.) Although Plaintiff
`included the specific quoted language above in her Complaint, she omitted it from
`her SAC. (Compare Compl. ¶ 16, with SAC ¶ 18.)
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`4
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 12 of 34 Page ID #:528
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`at checkout. (RJN Ex. B at 34, 36, 38-42.)
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`Quantum’s platform is designed to not capture sensitive information. As
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`Quantum stated explicitly on its website at the time Plaintiff filed this action, “there
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`are clear situations when sensitive data should not be captured, for example,
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`personally identifiable information (PII) such as . . . credit card numbers.” (RJN
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`Ex. B at 39.) “Quantum Metric automatically blocks capture of sensitive data,”
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`and businesses like Lululemon “can easily set up additional data that should never
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`be captured.” (Id. (emphasis added).) As for the limited universe of user-entered
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`data that a company may want captured, “for example, a user’s name and address or
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`a purchase order number,” Quantum encrypts it, which pseudonymizes the data.
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`(Id. at 40.) This anonymization and encryption happens on the user’s device before
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`any data is transmitted from it. (See RJN Ex. C at 64 (Column 6, Lines 33-35)
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`(“[T]he capture agent can strip sensitive information before transmitting the event
`records to the server-side web session storage engine”).7 Further, as Quantum
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`described it to customers on its website: “[T]o protect identifiable data and stay
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`compliant with [privacy laws], we use public / private key pair encryption, and only
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`you own the private key to decrypt sensitive data.” (RJN Ex. B at 40(emphasis in
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`original).) The graphic below illustrates the encryption process (id. at 42):
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`7 By keeping her cherry-picked references to Quantum’s patents in the SAC,
`Plaintiff continues to ignore the difference between an invention as described by a
`patent and the actual commercial product of the patentee. The purpose of a patent
`is to give the patentee the right to exclude all others from creating anything that is
`covered by the claims in the patent, and not to conclusively describe the
`functionality of a commercial product. Plaintiff’s mischaracterizations of the
`functionality of Quantum’s platform, therefore, should not be accepted as true to
`the extent they contradict Quantum’s description of its platform on its website. See
`Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001) (“The court
`need not, however, accept as true allegations that contradict matters properly
`subject to judicial notice or by exhibit.”).
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`5
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 13 of 34 Page ID #:529
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`IV. LEGAL STANDARD
`A complaint must be dismissed for failure to state a claim under Federal Rule
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`of Civil Procedure 12(b)(6) if the plaintiff either fails to state a cognizable legal
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`theory or has not alleged sufficient facts establishing a claim to relief that is
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`“plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
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`Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)); Eichenberger v. ESPN, Inc.,
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`876 F.3d 979, 982 (9th Cir. 2017). “[C]onclusory allegations without more are
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`insufficient to defeat a motion to dismiss . . . .” McGlinchy v. Shell Chem. Co.,
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`845 F.2d 802, 810 (9th Cir. 1988). Thus, the Court must not assume the truth of
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`6
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 14 of 34 Page ID #:530
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`legal conclusions merely because they are pleaded in the form of factual
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`allegations, nor should it accept as true allegations contradicted by judicially
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`noticeable facts. Iqbal, 556 U.S. at 677-79; Twombly, 550 U.S. at 555.
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`V. ARGUMENT
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`A.
`Plaintiff Fails to State a Claim Under CIPA § 631(a)
`In its July 15, 2021 Order, the Court separated CIPA § 631(a) into four
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`subsections. (July 15 Order at 7:12-8:11.) As before, Plaintiff alleges violations of
`subsections (i), (ii), and (iv).8 (See SAC ¶¶ 77-90; July 15 Order at 8:14-15.) Each
`of Plaintiff’s claims fail.9
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`1. Quantum was a participant to the communication
`Defendants respectfully renew their “participant exception” argument in light
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`of Plaintiff’s current allegations regarding Quantum’s platform and the recent
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`orders in Graham, Johnson, and Yale granting the defendants’ motions to dismiss
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`with prejudice. See Graham, 2021 WL 3602215, at *1-2; Johnson, 2021 WL
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`3602214, at *1-2; Yale, ECF No. 48, at 1-2. In its July 15 Order, the Court did not
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`dismiss Plaintiff’s CIPA § 631(a) claim pursuant to Defendants’ “participant
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`exception challenge” because the Court found that Plaintiff pled Quantum
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`“captures, stores, and interprets her real-time data—which extends beyond the
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`ordinary function of a tape recorder.” (July 15 Order at 10:6-11:2.)
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`In the SAC, however, Plaintiff alleges only that Quantum “captured,”
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`“recorded,” and “monitored” her browsing activity on Lululemon’s website. (SAC
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`8 Plaintiff does not clearly specify which CIPA § 631(a) subsections are alleged
`against which Defendant. Based on the manner in which Plaintiff pleads her aiding
`and abetting allegations under § 631(a)(iv), it appears Plaintiff’s § 631(a)(i) and (ii)
`claims are only alleged against Quantum.
`9 “[A]nalysis for a violation of CIPA is the same as that under the federal
`Wiretap Act.” Cline v. Reetz-Laiolo, 329 F. Supp. 3d 1000, 1051 (N.D. Cal. 2018)
`(quoting Underhill v. Kornblum, No. 16–CV–1598–AJB–WVG, 2017 WL
`2869734, at *6 (S.D. Cal. Mar. 16, 2017)); see also Brodsky v. Apple Inc., 445 F.
`Supp. 3d 110, 127 (N.D. Cal. 2020) (analysis of communication’s “contents” is the
`same under both statutes). Defendants accordingly cite cases analyzing both CIPA
`and the federal Wiretap Act.
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`
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`7
`DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT
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`Case 5:20-cv-02439-JWH-SHK Document 37 Filed 08/27/21 Page 15 of 34 Page ID #:531
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`¶¶ 46-49.) She does not allege that Quantum “stored” or “interpreted” her data.
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`(July 15 Order at 10:25-11:2.) Her allegations that Quantum “captured” and
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`“recorded” her browsing activity on Lululemon’s website, however, are insufficient
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`to overcome the “participant exception”—capturing and recording are standard and
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`operational features of a tape recorder. See Membrila v. Receivables Performance
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`Mgmt., LLC, No. 09-cv-2790, 2010 WL 1407274, at *2 (S.D. Cal. Apr. 6, 2010)
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`(finding § 631 “applies only to eavesdropping by a third party and not to recording
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`by a participant to a conversation”); Rogers v. Ulrich, 52 Cal. App. 3d 894, 898-99
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`(1975) (same). And, even if Plaintiff had pled that Quantum “interprets” her data,
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`courts have found such allegations insufficient.
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`Graham, Johnson, and Yale are instructive. In these cases, Magistrate
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`Judge Laurel Beeler (N.D. Cal.) granted defendants’ motions to dismiss on the
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`basis of the “participant exception.” Each plaintiff (all represented by the same
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`counsel as Plaintiff) then amended their complaints to allege that the defendant
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`“captured, stored, and analyzed [their] electronic communications in real time.”
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`(RJN Ex. F at ¶¶ 2, 42-45 (emphasis added); Ex. G at ¶¶ 2, 47-52; Ex. H at ¶¶ 2, 44-
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`50.) Despite these additional allegations (which go beyond Plaintiff’s allegations),
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`Judge Beeler found that the defendants’ actions d