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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`ROSEMARIE VARGAS, et al.,
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`Plaintiffs,
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`v.
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`FACEBOOK, INC.,
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`Case No. 19-cv-05081-WHO
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`ORDER GRANTING MOTION TO
`DISMISS WITH PREJUDICE
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`Re: Dkt. No. 92
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`Defendant.
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`In an Order dated January 21, 2021, I dismissed plaintiffs’ Second Amended Complaint
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`with leave to amend, requiring plaintiffs to add specific facts regarding the searches they
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`performed looking for housing on defendant Facebook, Inc.’s platform in order to attempt to plead
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`a plausible injury in support of their standing. January 2021 Order, Dkt. No. 86. I directed them
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`to state facts regarding matters within their knowledge about their use of Facebook to search for
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`housing, specifically what type of housing they searched for, during what time frames, and what
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`results were returned. Id. at 10-11.
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`On March 3, 2021, plaintiffs filed the Third Amended Complaint (“TAC”). Dkt. No. 89.
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`While plaintiffs have added additional details regarding the searches they performed, those
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`additional details do not plausibly demonstrate that they were injured by any housing advertiser’s
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`possible use of Facebook’s now-discontinued targeting criteria that could be used to direct paid
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`ads at specific categories of persons.1 And even if plaintiffs had been able to allege facts plausibly
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`supporting a harm to any of them sufficient to confer standing, the claims plaintiffs’ assert are
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`barred by the Communications Decency Act. The TAC is DISMISSED WITH PREJUDICE.
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`1 Plaintiffs note that Facebook was sued over the use of the targeting criteria tools by “the National
`Fair Housing Alliance and others, which resulted in a settlement in which Facebook purportedly
`vowed to revise its housing advertising practices to comply with the FHA by the end of 2019.”
`TAC ¶ 3; see also id. ¶ 52 n.5 (“Based on settlement agreements Facebook has entered into with
`various fair housing organizations, Facebook has publicly claimed it no longer illegally targets
`housing ads and it no longer allows housing advertisers to use its Ad Platform to target ads based
`on protected classes.”).
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 2 of 8
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`The TAC reasserts claims under the federal Fair Housing Act2 and analogous California3
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`BACKGROUND
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`and New York4 laws challenging Facebook, Inc.’s former practice of allowing advertisers to self-
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`select target audiences for their paid housing advertisements (“Targeted Ads” or “Ads”),
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`theoretically excluding protected classes of consumers from seeing those advertisers’ particular
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`housing ads.
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`I dismissed plaintiffs’ Second Amended Complaint (“SAC”), following the analyses of
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`two other Northern District of California cases that dismissed challenges to Facebook’s Targeted
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`Ad tools under other anti-discrimination laws for lack of standing. I held that plaintiffs’ standing
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`allegations were deficient because:
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`There are, in short, no facts showing that any of the plaintiffs were
`plausibly injured personally by the ad-targeting tools that advertisers
`purportedly used to possibly target housing ads in areas that plaintiffs
`possibly searched that plausibly resulted in plaintiffs not receiving ads
`for housing based on the aspects of their protected classifications that
`they otherwise would have been in a position to pursue
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`January 2021 Order at 9. I directed that plaintiffs plead:
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`[T]he facts within their exclusive knowledge, explaining what they
`actually did with respect to their use of Facebook to look for housing,
`how they know their white compatriot saw different ads, and facts
`regarding their then-current intent and ability to secure housing had
`they been shown a full range of ads through Facebook. Those facts –
`which are wholly absent from the SAC – are necessary to raise a
`plausible inference that Vargas or the other plaintiffs were injured in
`fact by the potential use of [] Facebook’s discriminatory tools by
`housing advertisers.
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`Id. at 10-11. I did not reach Facebook’s other arguments that the SAC should be dismissed with
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`prejudice and granted leave to amend.
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`The TAC adds some facts regarding each plaintiff’s use of Facebook during identified
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`times to search for housing based on identified criteria. See TAC ¶¶ 79-152. Their allegations
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`2 FHA, 42 U.S.C. § 3604 et seq.
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` 3
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` California Fair Employment and Housing Act (FEHA), Cal. Govt. Code § 12940 et seq. and
`California Unfair Competition Law (UCL), Cal. Bus. & Prof. Code § 17200 et seq.
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` New York State Human Rights Law, N.Y. Exec. Law § 296.
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 3 of 8
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`regarding Facebook’s Ad Platform’s design and tools allowing advertisers to target specific
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`groups for their paid Ads remained largely the same as in the SAC. See also January 2021 Order
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`at 2-3.
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`Facebook’s motion to dismiss argues that (i) plaintiffs lack standing because they fail to
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`allege facts about their use of Facebook to search for housing ads sufficient to plausibly allege
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`injury in fact, (ii) Facebook’s publishing conduct is protected and immune under Section 230 of
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`the Communications Decency Act (CDA, 47 U.S.C. § 230), and (iii) plaintiffs fail to state their
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`claims under the FHA, California, and New York laws.
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`LEGAL STANDARD
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`A motion pursuant to Federal Rule of Civil Procedure 12(b)(1) tests whether the court has
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`subject matter jurisdiction to hear the claims alleged in the complaint. A Rule 12(b)(1) motion
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`may be either facial, where the inquiry is limited to the allegations in the complaint, or factual,
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`where the court may look beyond the complaint to consider extrinsic evidence. Wolfe v.
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`Strankman, 392 F.3d 358, 362 (9th Cir. 2004). Here, Facebook brings a facial attack on the
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`sufficiency of the allegations in the SAC. See Safe Air for Everyone v. Meyer, 373 F.3d 1035,
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`1039 (9th Cir. 2004) (in a facial attack under Rule 12(b)(1), “the challenger asserts that the
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`allegations contained in a complaint are insufficient on their face to invoke federal jurisdiction.”).
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`A district court, “resolves a facial attack as it would a motion to dismiss under Rule 12(b)(6):
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`Accepting the plaintiff’s allegations as true and drawing all reasonable inferences in the plaintiff’s
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`favor, the court determines whether the allegations are sufficient as a legal matter to invoke the
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`court’s jurisdiction.” Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2014). As with a Rule
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`12(b)(6) motion, however, a court is not required “to accept as true allegations that are merely
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`conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Scis. Sec.
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`Litig., 536 F.3d 1049, 1055 (9th Cir. 2008).
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`DISCUSSION
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`I.
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`STANDING
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`In the TAC, each plaintiff adds details about the types (costs, size, location and other
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`“criteria”) of housing searches they conducted using Facebook, the timeframes when they used
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 4 of 8
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`Facebook to conduct those searches, and states that they did not receive any housing ads that
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`matched their criteria.5 They generally allege that if they had received Ads for housing that
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`matched their criteria, they would have pursued those housing opportunities. TAC ¶¶ 79-152.
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`Facebook contends that these more detailed allegations are still not sufficient to confer
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`standing because they do not plausibly allege that any plaintiff was in fact injured by Facebook’s
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`advertisers’ use of the now-defunct Ad targeting tools. I agree. As Facebook notes, plaintiffs do
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`not attempt to allege that housing was generally available in their desired markets – much less that
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`housing Ads satisfying those criteria were being placed in Facebook – under the criteria that any
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`of the plaintiffs were using during the times they were using Facebook to search for housing.6
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`That is fatal to plaintiffs’ standing.7
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`Only one plaintiff even attempts to make a showing that she received different results from
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`the Facebook searches she (a disabled female of Hispanic descent who is a single parent with
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`minor children) than her friend (a Caucasian) received. Specifically, Vargas alleges that:
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`On or about February or March 2019, Plaintiff Vargas was with a
`Caucasian friend, Chet Marcello. Plaintiff Vargas and [] Marcello sat
`side-by-side and conducted a search for housing through Facebook’s
`Marketplace, both using the same search criteria Plaintiff Vargas had
`been using. [] Marcello received more ads for housing in locations
`that were preferable to Plaintiff Vargas. Plaintiff Vargas did not
`receive the ads that [] Marcello received.
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`TAC ¶ 95.
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`Unlike in other places in the TAC, this paragraph about Vargas and her friend’s searches
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`does not distinguish between consumer-placed ads (that plaintiffs admit did not utilize the
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`“targeted criteria” plaintiffs claim are discriminatory) and paid Ads covered by the claims in this
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`5 The legal standard and discussion of standing cases from my January 2021 Order is incorporated
`herein.
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` See, e.g., TAC ¶ 85 (Vargas searched for “a three-bedroom apartment located in lower
`Manhattan in the rental price range of $1,7000.00 per month”); ¶ 107 (plaintiff Skipper searched
`for “a two-to-three bedroom single family home or apartment unit in Yonkers or Westchester
`County in the monthly rental range of $1,000 to $2,000.”).
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` As I noted in the January 2021 Order, the facts of this case are wholly unlike the “testing” cases
`plaintiffs rely on under the FHA where the facts demonstrated the housing sought by the plaintiffs
`was available and that the tester received false information. See January 2021 Order at 7-8
`(discussing Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982)).
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 5 of 8
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`case. Nor does plaintiff identify any specific ads that Marcello received that met plaintiff’s criteria
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`and that plaintiff would have pursued. She simply declares that Marcello received unspecific ads
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`in “preferable” locations. She does not indicate those ads, even if paid ads, met her other criteria
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`(cost, size, etc.) to plausibly allege that she was harmed by being denied access to those other,
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`unidentified ads. That is insufficient.
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`Plaintiffs contend, as they did on the prior round to dismiss, that I should not follow the
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`standing analyses of the Hon. Beth L. Freeman in Bradley v. T-Mobile US, Inc., 17-CV-07232-
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`BLF, 2020 WL 1233924 (N.D. Cal. Mar. 13, 2020) and the Hon. Jacqueline Scott Corley in
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`Opiotennione v. Facebook, Inc., 19-CV-07185-JSC, 2020 WL 5877667, at *1 (N.D. Cal. Oct. 2,
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`2020. Both of those cases challenged Facebook’s Targeting Ads program, and both were
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`dismissed for lack of standing given plaintiffs’ failure to plead plausible facts to support that they
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`were harmed under other anti-discriminatory laws by advertiser’s use of the Targeted Ad tools.
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`Plaintiffs repeat their unsupported argument that I should not follow the analyses in those cases
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`because standing under the FHA is broader than under Title VII and the statutory schemes
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`considered by Judges Freeman and Corley. Oppo. at 10-11. I addressed and rejected this
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`argument in the January 2021 Order at 7-9 (discussing and distinguishing Bank of Am. Corp. v.
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`City of Miami, Fla., 137 S. Ct. 1296, 1304 (2017), Havens Realty Corp. v. Coleman, 455 U.S. 363,
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`373–74 (1982),Gladstone Realtors v. Village of Bellwood, 441 U.S. 91, 110-111 (1979), and
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`Trafficante v. Metro. Life Ins. Co., 409 U.S. 205, 209-212 (1972)) and will not revisit it again.8
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`In sum, what the plaintiffs have alleged is that they each used Facebook to search for
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`housing based on identified criteria and that no results were returned that met their criteria. They
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`assume (but plead no facts to support) that no results were returned because unidentified
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`advertisers theoretically used Facebook’s Targeting Ad tools to exclude them based on their
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`8 A recent decision from the District of Maryland further supports my conclusion. In
`Opiotennione v. Bozzuto Mgt. Co., CV 20-1956 PJM, 2021 WL 3055614 (D. Md. July 20, 2021),
`the plaintiffs sued the underlying advertisers who allegedly used Facebook to place Targeted Ads
`in a discriminatory fashion in violation of local antidiscrimination and consumer protection laws.
`Despite plaintiffs alleging they were denied access to ads placed for specifically identified housing
`complexes in their area – something plaintiffs here do not even attempt to allege – the court
`dismissed for lack of standing. Id. at *3-4 (distinguishing Havens Realty Corp. v. Coleman, 455
`U.S. 363, 373–74 (1982)).
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`Northern District of California
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 6 of 8
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`protected class statuses from seeing paid Ads for housing that they assume (again ,with no facts
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`alleged in support) were available and would have otherwise met their criteria. Plaintiffs’ claim
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`that Facebook denied them access to unidentified Ads is the sort of generalized grievance that is
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`insufficient to support standing. See, e.g., Carroll v. Nakatani, 342 F.3d 934, 940 (9th Cir. 2003)
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`(“The Supreme Court has repeatedly refused to recognize a generalized grievance against
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`allegedly illegal government conduct as sufficient to confer standing” and when “a government
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`actor discriminates on the basis of race, the resulting injury ‘accords a basis for standing only to
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`those persons who are personally denied equal treatment.’” (quoting Allen v. Wright, 468 U.S.
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`737, 755 (1984)).9
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`Having failed to plead facts supporting a plausible injury in fact sufficient to confer
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`standing on any plaintiff, the TAC is DISMISSED with prejudice.
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`II.
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`CDA
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`If plaintiffs had alleged sufficient facts to plausibly state an injury from Facebook’s
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`discontinued provision of Targeting Ad tools for paid advertisers, their claims would still be
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`barred by Section 230 of the Communications Decency Act.
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`Section 230 of the CDA “immunizes providers of interactive computer services against
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`liability arising from content created by third parties.” Fair Hous. Council of San Fernando
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`Valley v. Roommates.Com, LLC (“Roommates”), 521 F.3d 1157, 1162 (9th Cir. 2008) (en banc).
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`Section 230(c)(1) explains that, “providers or user of an interactive computer service shall not be
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`treated as the publisher or speaker of any information provided by another information content
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`provider.” 47 U.S.C. § 230(c)(1). Under the CDA, “[i]mmunity from liability exists for ‘(1) a
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`provider or user of an interactive computer service (2) whom a plaintiff seeks to treat, under a state
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`law cause of action, as a publisher or speaker (3) of information provided by another information
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`9 For similar reasons, plaintiffs have failed to plausibly plead injury and thus standing to pursue
`their claims under the California and New York laws alleged. See Oppo. at 11-12 (admitting that
`under the California laws “Plaintiffs must establish standing by alleging facts showing that they
`‘actually suffer[ed] the discriminatory conduct’ being challenged and possess a ‘concrete and
`actual interest that is not merely hypothetical or conjectural’ []” and under “the NYSHRL,
`Plaintiffs must establish that they have been ‘aggrieved by an unlawful discriminatory practice,’
`N.Y. Exec. Law § 297, which ‘requires a threshold showing that a person has been adversely
`affected by the activities of defendants.’” (citations omitted)).
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`Northern District of California
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 7 of 8
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`content provider,’” and when “a plaintiff cannot allege enough facts to overcome Section 230
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`immunity, a plaintiff’s claims should be dismissed.” Dyroff v. Ultimate Software Group, Inc., 934
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`F.3d 1093, 1097 (9th Cir. 2019), cert. denied, 140 S. Ct. 2761 (2020) (quoting Kimzey v. Yelp!
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`Inc., 836 F.3d 1263, 1268-71 (9th Cir. 2016)).
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`Relying on Roommates, plaintiffs contend that Facebook’s conduct here – creating,
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`promoting use of, and profiting from paid advertisers’ use of the Targeting Ad tools – removes
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`any immunity that Facebook would otherwise have under the CDA. In Roommates, the Ninth
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`Circuit explained that “the CDA does not grant immunity for inducing third parties to express
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`illegal preferences,” and found that “Roommate’s own acts—posting the questionnaire and
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`requiring answers to it—are entirely its doing and thus section 230 of the CDA does not apply to
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`them. Roommate is entitled to no immunity.” Roommates, 521 F.3d at 1165.
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`Roommates is materially distinguishable from this case based on plaintiffs’ allegations in
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`the TAC that the now-defunct Ad Targeting process was made available by Facebook for optional
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`use by advertisers placing a host of different types of paid-advertisements.10 Unlike in Roommates
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`where use of the discriminatory criteria was mandated, here use of the tools was neither mandated
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`nor inherently discriminatory given the design of the tools for use by a wide variety of advertisers.
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`In Dyroff, the Ninth Circuit concluded that tools created by the website creator – there,
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`“recommendations and notifications” the website sent to users based on the user’s inquiries that
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`ultimately connected a drug dealer and a drug purchaser – did not turn the defendant who
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`10 See, e.g., TAC ¶¶ 45, 46, 50, 52, 55, incorporating by reference multiple descriptions of how
`Facebook’s Ad Platform and the tools at issue work, including:
`https://www.facebook.com/about/ads
`https://www.facebook.com/business/success/categories/real-estate
`https://www.facebook.com/business/ads
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`Facebook also requests, and plaintiffs’ object, to my taking notice of the following: (i) Facebook’s
`“Discriminatory Practices” subpage of its “Advertising Policies” webpage; (ii) Facebook’s
`“Advertising Policies” webpage; (iii) screenshots of the Facebook Marketplace; (iv) screenshots of
`Facebook’s user sign-up screens that existed at the time the New York Plaintiffs registered for
`Facebook; (v) Facebook’s past terms of service that existed at the time the New York Plaintiffs
`registered for Facebook; (vi) Facebook’s terms of service effective as of February 4, 2009; and
`(vii) Facebook’s present terms of service. Dkt. Nos. 95, 97, 99. The request for judicial notice is
`DENIED. I do not rely on these documents or the information in this Order.
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`Case 3:19-cv-05081-WHO Document 105 Filed 08/20/21 Page 8 of 8
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`controlled the website into a content creator unshielded by CDA immunity. The panel confirmed
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`that the tools were “meant to facilitate the communication and content of others. They are not
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`content in and of themselves.” Dyroff, 934 F.3d 1093, 1098 (9th Cir. 2019), cert. denied, 140 S.
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`Ct. 2761 (2020); see also Carafano v. Metrosplash.com, Inc., 339 F.3d 1119, 1124 (9th Cir. 2003)
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`(where website “questionnaire facilitated the expression of information by individual users”
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`including proposing sexually suggestive phrases that could facilitate the development of libelous
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`profiles, but left “selection of the content [] exclusively to the user,” and defendant was not
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`“responsible, even in part, for associating certain multiple choice responses with a set of physical
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`characteristics, a group of essay answers, and a photograph,” website operator was not information
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`content provider falling outside Section 230’s immunity); Goddard v. Google, Inc., 640 F. Supp.
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`2d 1193, 1197 (N.D. Cal. 2009) (no liability based on Google’s use of “Keyword Tool,” that
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`employs “an algorithm to suggest specific keywords to advertisers”).
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`Here, the Ad Tools are neutral. It is the users “that ultimately determine what content to
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`post, such that the tool merely provides ‘a framework that could be utilized for proper or improper
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`purposes, . . . .’” Roommates, 521 F.3d at 1172 (analyzing Carafano). Therefore, even if the
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`plaintiffs could allege facts supporting a plausible injury, their claims are barred by Section 230.11
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`Accordingly, plaintiffs’ TAC is DISMISSED WITH PREJUDICE.
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`CONCLUSION
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`IT IS SO ORDERED.
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`Dated: August 20, 2021
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`William H. Orrick
`United States District Judge
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`11 Having found two bases for dismissal with prejudice of plaintiffs’ TAC, I need not reach
`defendant’s other arguments for dismissal for failure to plead required elements of the claims
`under the FHA and state laws.
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`Northern District of California
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`United States District Court
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