Case 1:21-cv-00671 ECF No. 1, PageID.1 Filed 08/05/21 Page 1 of 27
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF MICHIGAN
`
`RUBY HESTER and STEWART MURIE,
`individually and on behalf of all others
`similarly situated,
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`1:21-cv-671
`Case No. ______________
`
`Plaintiff,
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`CLASS ACTION COMPLAINT
`JURY TRIAL DEMANDED
`
`
`v.
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`PLUS COMMUNICATIONS INC. D/B/A
`CHARISMA MEDIA,
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`Defendant.
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`Plaintiff Ruby Hester and Stewart Murie (“Plaintiffs”), individually and on
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`behalf of themselves and all others similarly situated, by and through their attorneys,
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`makes the following allegations pursuant to the investigation of their counsel and
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`based upon information and belief, except as to allegations specifically pertaining to
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`themselves and their counsel, which are based on personal knowledge.
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`INTRODUCTION
`Defendant Plus Communications Inc. d/b/a Charisma Media
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`1.
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`(“Charisma”) rented, exchanged, and/or otherwise disclosed detailed information
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`about Plaintiffs’ Charisma magazine subscriptions to data aggregators, data
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`appenders, data cooperatives, and list brokers, among others, which in turn disclosed
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`their information to aggressive advertisers, political organizations, and non-profit
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`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF MICHIGAN
`
`RUBY HESTER and STEWART MURIE,
`individually and on behalf of all others
`similarly situated,
`
`1:21-cv-671
`Case No. ______________
`
`Plaintiff,
`
`CLASS ACTION COMPLAINT
`JURY TRIAL DEMANDED
`
`
`v.
`
`PLUS COMMUNICATIONS INC. D/B/A
`CHARISMA MEDIA,
`
`Defendant.
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`Plaintiff Ruby Hester and Stewart Murie (“Plaintiffs”), individually and on
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`behalf of themselves and all others similarly situated, by and through their attorneys,
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`makes the following allegations pursuant to the investigation of their counsel and
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`based upon information and belief, except as to allegations specifically pertaining to
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`themselves and their counsel, which are based on personal knowledge.
`
`INTRODUCTION
`Defendant Plus Communications Inc. d/b/a Charisma Media
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`1.
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`(“Charisma”) rented, exchanged, and/or otherwise disclosed detailed information
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`about Plaintiffs’ Charisma magazine subscriptions to data aggregators, data
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`appenders, data cooperatives, and list brokers, among others, which in turn disclosed
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`their information to aggressive advertisers, political organizations, and non-profit
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`Case 1:21-cv-00671 ECF No. 1, PageID.2 Filed 08/05/21 Page 2 of 27
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`companies. As a result, Plaintiffs have received a barrage of unwanted junk mail.
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`By renting, exchanging, and/or otherwise disclosing Plaintiffs’ Private Reading
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`Information (defined below) during the relevant pre-July 30, 2016 time period1,
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`Charisma violated Michigan’s Preservation of Personal Privacy Act, H.B. 5331, 84th
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`Leg. Reg. Sess., P.A. No. 378, §§ 1-4 (Mich. 1988), id. § 5, added by H.B. 4694,
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`85th Leg. Reg. Sess., P.A. No. 206, § 1 (Mich. 1989) (the “PPPA”).2
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`2.
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`Documented evidence confirms these facts. For example, a list broker,
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`NextMark, Inc. (“NextMark”), offers to provide renters access to the mailing list
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`titled “Charisma Media Masterfile Mailing List”, which contains the Private
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`Reading Information of 786,552 of Charisma’s active U.S. subscribers at a base
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`price of “$100.00/M [per thousand],” (i.e., 10 cents apiece), as shown in the
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`screenshot below:
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`The statutory period for this action is six years. See M.C.L. § 600.5813.
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`1
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` 2
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`In May 2016, the Michigan legislature amended the PPPA. See S.B. 490, 98th
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`Leg., Reg. Sess., P.A. No. 92 (Mich. 2016) (codified at M.C.L. § 445.1711, et seq.).
`The May 2016 amendment to the PPPA, which became effective on July 31, 2016,
`does not apply retroactively to claims that accrued prior to its July 31, 2016 effective
`date. See Boelter v. Hearst Commc’ns, Inc., 192 F. Supp. 3d 427, 439-41 (S.D.N.Y.
`2016) (holding that “the amendment to the [PP]PA does not apply to Plaintiffs’
`claims, and the Court will assess the sufficiency of those claims under the law as it
`was when Plaintiffs’ claims accrued.”) (citing Landgraf v. USI Film Prods., 511 U.S.
`224, 286 (1994)). Because the claims alleged herein accrued, and thus vested, prior
`to the July 31, 2016 effective date of the amended version of the PPPA, the pre-
`amendment version of the PPPA applies in this case. See Horton v. GameStop,
`Corp., -- F. Supp. 3d --, 2018 WL 8335635, at *2-3 (W.D. Mich. Sept. 28, 2018).
`2
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`See Exhibit A hereto.
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`3.
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`By renting, exchanging, or otherwise disclosing the Private Reading
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`Information of its Michigan-based subscribers during the relevant pre-July 30, 2016
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`time period, Charisma violated the PPPA. Subsection 2 of the PPPA provides:
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`[A] person, or an employee or agent of the person,
`engaged in the business of selling at retail, renting, or
`lending books or other written materials ... shall not
`disclose to any person, other than the customer, a record
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`3
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`or information concerning the purchase ... of those
`materials by a customer that indicates the identity of the
`customer.
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`PPPA § 2.
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`4.
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`Accordingly, Plaintiffs bring this Class Action Complaint against
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`Charisma for its intentional and unlawful disclosure of its customers’ Private
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`Reading Information in violation of the PPPA.
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`NATURE OF THE CASE
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`5.
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`To supplement its revenues, Charisma rents, exchanges, or otherwise
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`discloses its customers’ information—including their full names, titles of
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`publications subscribed to, and home addresses (collectively “Private Reading
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`Information”), as well as myriad other categories of individualized data and
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`demographic information such as age, gender, income, marital status, and childrens'
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`age—to data aggregators, data appenders, data cooperatives, and other third parties
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`without the written consent of its customers.
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`6.
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`By renting, exchanging, or otherwise disclosing – rather than selling –
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`its customers’ Private Reading Information, Charisma is able to disclose the
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`information time and time again to countless third parties.
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`7.
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`Charisma’s disclosure of Private Reading Information and other
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`individualized information is not only unlawful, but also dangerous because it allows
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`for the targeting of particularly vulnerable members of society. For example, anyone
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`4
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`could buy a customer list provided by Charisma that contains the names and
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`addresses of all unmarried women over the age of 60 with an annual income of
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`greater than $80,000 who reside in Detroit, Michigan and subscribe to Charisma
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`magazine. Such a list is available for sale on the open market for approximately
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`$132.00 per thousand subscribers listed.
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`8.
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`While Charisma profits handsomely from the unauthorized rental,
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`exchange, and/or disclosure of its customers’ Private Reading Information and other
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`individualized information, it does so at the expense of its customers’ statutory
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`privacy rights (afforded by the PPPA) because Charisma does not obtain its
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`customers’ written consent prior to disclosing their Private Reading Information.
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`PARTIES
`Plaintiff Ruby Hester is a natural person and citizen of the State of
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`9.
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`Michigan and resides in Lansing, Michigan. Plaintiff was a subscriber to Charisma
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`magazine, including during the relevant pre-July 30, 2016 time period. Charisma
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`magazine is published by Charisma. While residing in, a citizen of, and present in
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`Michigan, Plaintiff purchased her subscription to Charisma magazine directly from
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`Charisma. Prior to and at the time Plaintiff subscribed to Charisma, Charisma did
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`not notify Plaintiff that it discloses the Private Reading Information of its customers,
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`and Plaintiff has never authorized Charisma to do so. Furthermore, Plaintiff was
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`never provided any written notice that Charisma rents, exchanges, or otherwise
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`5
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`discloses its customers’ Private Reading Information, or any means of opting out.
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`Since subscribing to Charisma, and during the relevant pre-July 30, 2016 time
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`period, Charisma disclosed, without the requisite consent or prior notice, Plaintiff’s
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`Private Reading Information to data aggregators, data appenders, and/or data
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`cooperatives, who then supplement that information with data from their own files.
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`Moreover, during that same period, Charisma rented or exchanged mailing lists
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`containing Plaintiff’s Private Reading Information to third parties seeking to contact
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`Charisma subscribers, without first obtaining the requisite written consent from
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`Plaintiff or even giving her prior notice of the rentals, exchanges, and/or other
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`disclosures.
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`10. Plaintiff Stewart Murie is a natural person and citizen of the State of
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`Michigan and resides in Fruitport, Michigan. Plaintiff was a subscriber to Charisma
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`magazine, including during the relevant pre-July 30, 2016 time period. Charisma
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`magazine is published by Charisma. While residing in, a citizen of, and present in
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`Michigan, Plaintiff purchased his subscription to Charisma magazine directly from
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`Charisma. Prior to and at the time Plaintiff subscribed to Charisma, Charisma did
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`not notify Plaintiff that it discloses the Private Reading Information of its customers,
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`and Plaintiff has never authorized Charisma to do so. Furthermore, Plaintiff was
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`never provided any written notice that Charisma rents, exchanges, or otherwise
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`discloses its customers’ Private Reading Information, or any means of opting out.
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`6
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`Since subscribing to Charisma, and during the relevant pre-July 30, 2016 time
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`period, Charisma disclosed, without the requisite consent or prior notice, Plaintiff’s
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`Private Reading Information to data aggregators, data appenders, and/or data
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`cooperatives, who then supplement that information with data from their own files.
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`Moreover, during that same period, Charisma rented or exchanged mailing lists
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`containing Plaintiff’s Private Reading Information to third parties seeking to contact
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`Charisma subscribers, without first obtaining the requisite written consent from
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`Plaintiff or even giving him prior notice of the rentals, exchanges, and/or other
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`disclosures.
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`11. Defendant Plus Communications Inc. d/b/a Charisma Media is a
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`Florida corporation with its headquarters and principal place of business in Lake
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`Mary, Florida. Charisma does business throughout Michigan and the entire United
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`States. Charisma is the publisher of Ministry Today magazine and its flagship
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`publication Charisma magazine.
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`JURISDICTION AND VENUE
`This Court has subject matter jurisdiction over this civil action
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`12.
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`pursuant to 28 U.S.C. § 1332(d) because there are more than 100 class members and
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`the aggregate amount in controversy exceeds $5,000,000, exclusive of interest, fees,
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`and costs, and at least one Class member is a citizen of a state different from
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`Defendant.
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`7
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`13.
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`The Court has personal jurisdiction over Charisma because Plaintiffs’
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`claims arose in substantial part from actions and omissions in Michigan, including
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`from Plaintiffs’ purchases of a Charisma subscription in Michigan, Charisma’s
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`direction of such Charisma subscription into Michigan, and Charisma’s failure to
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`obtain Plaintiffs’ written consent in Michigan prior to disclosing their Private
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`Reading Information, including their residential addresses in Michigan, to another
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`person, the effects of which were felt from within Michigan by a citizen and resident
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`of Michigan. Personal jurisdiction also exists over Charisma in Michigan because
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`Charisma conducts substantial business within Michigan, such that Charisma has
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`significant, continuous, and pervasive contacts with the State of Michigan.
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`14.
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`Venue is proper in this District pursuant to 28 U.S.C. § 1391 because
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`Charisma does substantial business in this judicial District and a substantial part of
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`the events giving rise to Plaintiffs’ claims took place within this judicial District.
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`FACTUAL BACKGROUND
`Michigan’s Preservation of Personal Privacy Act
`In 1988, members of the United States Senate warned that records of
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`15.
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`consumers’ purchases and rentals of audiovisual and publication materials offer “a
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`window into our loves, likes, and dislikes,” and that “the trail of information
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`generated by every transaction that is now recorded and stored in sophisticated
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`record-keeping systems is a new, more subtle and pervasive form of surveillance.”
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`8
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`S. Rep. No. 100-599 at 7–8 (1988) (statements of Sens. Simon and Leahy,
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`respectively).
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`16.
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`Recognizing the need to further protect its citizens’ privacy rights,
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`Michigan’s legislature enacted the PPPA to protect “privacy with respect to the
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`purchase, rental, or borrowing of certain materials,” by prohibiting companies from
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`disclosing certain types of sensitive consumer information. H.B. No. 5331, 1988
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`Mich. Legis. Serv. 378 (West).
`
`17.
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`Subsection 2 of the PPPA states:
`
`
`
`[A] person, or an employee or agent of the person,
`engaged in the business of selling at retail, renting, or
`lending books or other written materials . . . shall not
`disclose to any person, other than the customer, a record
`or information concerning the purchase . . . of those
`materials by a customer that indicates the identity of the
`customer.
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`PPPA § 2 (emphasis added).
`
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`18. Michigan’s protection of reading information reflects the “gut feeling
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`that people ought to be able to read books and watch films without the whole world
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`knowing,” and recognizes that “[b]ooks and films are the intellectual vitamins that
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`fuel the growth of individual thought. The whole process of intellectual growth is
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`one of privacy—of quiet, and reflection. This intimate process should be protected
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`from the disruptive intrusion of a roving eye.” S. Rep. No. 100–599, at 6 (Statement
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`of Rep. McCandless).
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`9
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`19.
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`As Senator Patrick Leahy recognized in proposing the Video and
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`Library Privacy Protection Act (later codified as the Video Privacy Protection Act,
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`18 U.S.C. § 2710), “[i]n practical terms our right to privacy protects the choice of
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`movies that we watch with our family in our own homes. And it protects the
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`selection of books that we choose to read.” 134 Cong. Rec. S5399 (May 10, 1988).
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`20.
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`Senator Leahy also explained why choices in movies and reading
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`materials are so private: “These activities . . . reveal our likes and dislikes, our
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`interests and our whims. They say a great deal about our dreams and ambitions, our
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`fears and our hopes. They reflect our individuality, and they describe us as people.”
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`Id.
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`21. Michigan’s passage of the PPPA also established as a matter of law
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`“that a person’s choice in reading, music, and video entertainment is a private matter,
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`and not a fit subject for consideration by gossipy publications, employers, clubs, or
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`anyone else for that matter.” Privacy: Sales, Rentals of Videos, etc., House
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`Legislative Analysis Section, H.B. No. 5331, Jan. 20, 1989 (attached hereto as
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`Exhibit B).
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`22.
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`Despite the fact that thousands of Michigan residents subscribe to
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`Charisma’s publications, Charisma disregarded
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`its
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`legal responsibility by
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`systematically violating the PPPA.
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`10
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`The Private Information Market:
`Consumers’ Private Information Has Real Value
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`In 2001, Federal Trade Commission (“FTC”) Commissioner Orson
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`23.
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`Swindle remarked that “the digital revolution . . . has given an enormous capacity
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`to the acts of collecting and transmitting and flowing of information, unlike anything
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`we’ve ever seen in our lifetimes . . . [and] individuals are concerned about being
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`defined by the existing data on themselves.”3
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`24. More than a decade later, Commissioner Swindle’s comments ring
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`truer than ever, as consumer data feeds an information marketplace that supports a
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`$26 billion dollar per year online advertising industry in the United States.4
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`25.
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`The FTC has also recognized that consumer data possesses inherent
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`monetary value within the new information marketplace and publicly stated that:
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`Most consumers cannot begin to comprehend the types
`and amount of information collected by businesses, or why
`their information may be commercially valuable. Data is
`currency. The larger the data set, the greater potential for
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`Exhibit C, The Information Marketplace: Merging and Exchanging
`3
`Consumer Data
`(Mar.
`13,
`2001),
`at
`8:15-11:16,
`available
`at
`https://www.ftc.gov/sites/default/files/documents/public_events/information-
`marketplace-merging-and-exchanging-consumer-data/transcript.pdf
`(last visited
`July 30, 2021).
`See Exhibit D, Web’s Hot New Commodity: Privacy, WSJ (Feb. 28, 2011),
`4
`http://online.wsj.com/article/SB10001424052748703529004576160764037920274
`.html (last visited July 30, 2021).
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`11
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`
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`analysis—and profit.5
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`26.
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`In fact, an entire industry exists while companies known as data
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`aggregators purchase, trade, and collect massive databases of information about
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`consumers. Data aggregators then profit by selling this “extraordinarily intrusive”
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`information in an open and largely unregulated market.6
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`27.
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`The scope of data aggregators’ knowledge about consumers is
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`immense: “If you are an American adult, the odds are that [they] know[] things like
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`your age, race, sex, weight, height, marital status, education level, politics, buying
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`habits, household health worries, vacation dreams—and on and on.”7
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`28.
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`Further, “[a]s use of the Internet has grown, the data broker industry
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`has already evolved to take advantage of the increasingly specific pieces of
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`
`Exhibit E, Statement of FTC Commissioner Pamela Jones Harbour (Dec. 7,
`5
`at
`2,
`2009),
`available
`at
`https://www.ftc.gov/sites/default/files/documents/public_statements/remarks-ftc-
`exploring-privacy-roundtable/091207privacyroundtable.pdf (last visited July 30,
`2021) (emphasis added).
`See Exhibit F, Martha C. White, Big Data Knows What You’re Doing Right
`6
`Now, TIME.com (July 31, 2012), http://moneyland.time.com/2012/07/31/big-data-
`knows-what-youre-doing-right-now/ (last visited July 30, 2021).
`Exhibit G, Natasha Singer, You for Sale: Mapping, and Sharing, the
`7
`Consumer Genome, N.Y. Times
`(June
`16,
`2012),
`available
`at
`https://www.immagic.com/eLibrary/ARCHIVES/GENERAL/GENPRESS/N12061
`6S.pdf (last visited July 30, 2021).
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`
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`12
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`information about consumers that are now available.”8
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`29.
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`Recognizing the serious threat the data mining industry poses to
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`consumers’ privacy, on July 25, 2012, the co-Chairmen of the Congressional Bi-
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`Partisan Privacy Caucus sent a letter to nine major data brokerage companies
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`seeking information on how those companies collect, store, and sell their massive
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`collections of consumer data.9
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`30.
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`In their letter, the co-Chairmen recognized that “[b]y combining data
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`from numerous offline and online sources, data brokers have developed hidden
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`dossiers on every U.S. consumer,” which “raises a number of serious privacy
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`concerns.”10
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`31.
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`Data aggregation
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`is especially
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`troublesome when consumer
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`information is sold to direct-mail advertisers. In addition to causing waste and
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`Exhibit H, Letter from Senator John D. Rockefeller IV, Chairman, Senate
`8
`Committee on Commerce, Science, and Transportation, to Scott E. Howe, Chief
`Executive
`Officer,
`Acxiom
`(Oct.
`9,
`2012)
`available
`at
`http://www.commerce.senate.gov/public/?a=Files.Serve&File_id=3bb94703-5ac8-
`4157-a97b-a658c3c3061c (last visited July 30, 2021).
`See Exhibit I, Bipartisan Group of Lawmakers Query Data Brokers About
`9
`Practices Involving Consumers’ Personal Information, Website of Senator Ed
`Markey
`(July
`24,
`2012),
`http://www.markey.senate.gov/news/press-
`releases/bipartisan-group-of-lawmakers-query-data-brokers-about-practices-
`involving-consumers-personal-information (last visited July 30, 2021).
`10
`Id.
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`13
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`inconvenience, direct-mail advertisers often use consumer information to lure
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`unsuspecting consumers into various scams,11 including fraudulent sweepstakes,
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`charities, and buying clubs. Thus, when companies like Charisma share information
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`with data aggregators, data cooperatives, and direct-mail advertisers, they contribute
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`to the “[v]ast databases” of consumer data that are often “sold to thieves by large
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`publicly traded companies,” which “put[s] almost anyone within the reach of
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`fraudulent telemarketers” and other criminals.12
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`32.
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`Information disclosures like those made by Charisma are particularly
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`dangerous to the elderly. “Older Americans are perfect telemarketing customers,
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`analysts say, because they are often at home, rely on delivery services, and are lonely
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`for the companionship that telephone callers provide.”13 The FTC notes that “[t]he
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`elderly often are the deliberate targets of fraudulent telemarketers who take
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`advantage of the fact that many older people have cash reserves or other assets to
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`
`J,
`See Exhibit
`Trade Commission,
`Federal
`Scams,
`11
`Prize
`http://www.consumer.ftc.gov/articles/0199-prize-scams (last visited July 30, 2021).
`
`Exhibit K, Charles Duhigg, Bilking the Elderly, With a Corporate Assist,
`12
`Times,
`May
`20,
`2007,
`at
`N.Y.
`available
`http://www.nytimes.com/2007/05/20/business/20tele.html (last visited July 30,
`2021).
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`13
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`Id.
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`14
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`spend on seemingly attractive offers.”14 Indeed, an entire black market exists where
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`the private information of vulnerable elderly Americans is exchanged.
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`33.
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`Thus, information disclosures like Charisma’s are particularly
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`troublesome because of their cascading nature: “Once marked as receptive to [a
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`specific] type of spam, a consumer is often bombarded with similar fraudulent offers
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`from a host of scam artists.”15
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`34.
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`Charisma is not alone in jeopardizing its subscribers’ privacy and
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`well-being in exchange for increased revenue: disclosing subscriber information to
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`data aggregators, data appenders, data cooperatives, direct marketers, and other third
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`parties is a widespread practice in the publishing industry.
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`35.
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`Thus, as consumer data has become an ever-more valuable
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`commodity, the data mining industry has experienced rapid and massive growth.
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`Unfortunately for consumers, this growth has come at the expense of their most
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`basic privacy rights.
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`Exhibit L, Fraud Against Seniors: Hearing before the Senate Special
`14
`Committee on Aging (August 10, 2000) (prepared statement of the FTC), available
`https://www.ftc.gov/sites/default/files/documents/public_statements/prepared-
`at
`statement-federal-trade-commission-fraud-against-seniors/agingtestimony.pdf (last
`visited July 30, 2021).
`15
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`See id.
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`15
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`Consumers Place Monetary Value on their Privacy and
`Consider Privacy Practices When Making Purchases
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`As the data aggregation and cooperative industry has grown, so too
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`36.
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`have consumer concerns regarding the privacy of their information.
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`37.
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`A recent survey conducted by Harris Interactive on behalf of
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`TRUSTe, Inc. showed that 89 percent of consumers polled avoid doing business
`
`with companies who they believe do not protect their privacy online.16 As a result,
`
`81 percent of smartphone users polled said that they avoid using smartphone apps
`
`that they don’t believe protect their privacy online.17
`
`38.
`
`Thus, as consumer privacy concerns grow, consumers are increasingly
`
`incorporating privacy concerns and values into their purchasing decisions and
`
`companies viewed as having weaker privacy protections are forced to offer greater
`
`value elsewhere (through better quality and/or lower prices) than their privacy-
`
`protective competitors.
`
`39.
`
`In fact, consumers’ private information has become such a valuable
`
`
`See Exhibit M, 2014 TRUSTe US Consumer Confidence Privacy Report,
`16
`TRUSTe,
`http://www.theagitator.net/wp-
`content/uploads/012714_ConsumerConfidenceReport_US1.pdf (last visited July
`30, 2021).
`17
`
`
`Id.
`
`
`
`16
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.17 Filed 08/05/21 Page 17 of 27
`
`commodity that companies are beginning to offer individuals the opportunity to sell
`
`their information themselves.18
`
`40.
`
`These companies’ business models capitalize on a fundamental tenet
`
`underlying the consumer information marketplace: consumers recognize the
`
`economic value of their private data. Research shows that consumers are willing to
`
`pay a premium to purchase services from companies that adhere to more stringent
`
`policies of protecting their data.19
`
`41.
`
`Thus, in today’s economy, individuals and businesses alike place a
`
`real, quantifiable value on consumer data and corresponding privacy rights.20
`
`
`
`
`
`
`See Exhibit N, Joshua Brustein, Start-Ups Seek to Help Users Put a Price on
`18
`Their Personal Data, N.Y. Times
`(Feb. 12, 2012), available at
`http://www.nytimes.com/2012/02/13/technology/start-ups-aim-to-help-users-put-a-
`price-on-their-personal-data.html (last visited July 30, 2021).
`
`See Exhibit O, Tsai, Cranor, Acquisti, and Egelman, The Effect of Online
`19
`Privacy Information on Purchasing Behavior, 22(2) Information Systems Research
`254, 254 (2011); see also European Network and Information Security Agency,
`(Feb.
`27,
`2012),
`Study
`on monetising
`privacy
`available
`at
`https://www.enisa.europa.eu/activities/identity-and-
`trust/library/deliverables/monetising-privacy (last visited July 30, 2021).
`
`See Exhibit P, Hann, et al., The Value of Online Information Privacy: An
`20
`(Oct.
`2003)
`at
`2,
`Empirical
`Investigation
`available
`at
`http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.321.6125&rep=rep1&ty
`pe=pdf (last visited July 30, 2021) (“The real policy issue is not whether consumers
`value online privacy. It is obvious that people value online privacy.”).
`17
`
`
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.18 Filed 08/05/21 Page 18 of 27
`
`Charisma Unlawfully Rents, Exchanges, And Discloses Its Customers’ Private
`Reading Information
`Charisma maintains a vast digital database comprised of its
`
`42.
`
`customers’ Private Reading Information. Charisma discloses its customers’ Private
`
`Reading Information to data aggregators and appenders, who then supplement that
`
`information with additional sensitive private information about each Charisma
`
`customer, including his or her age, gender, income, marital status, and childrens'
`
`age. (See, e.g., Exhibit A).
`
`43.
`
`Charisma then rents and/or exchanges its mailing lists—which include
`
`subscribers’ Private Reading Information identifying which individuals purchased
`
`subscriptions to particular magazines, and can include the sensitive information
`
`obtained from data aggregators and appenders—to other data aggregators and
`
`appenders, other consumer-facing businesses, non-profit organizations seeking to
`
`raise awareness and solicit donations, and to political organizations soliciting
`
`donations, votes, and volunteer efforts. (See Exhibit A).
`
`44.
`
`Charisma also discloses its customers’ Private Reading Information to
`
`data cooperatives, who in turn give Charisma access to their own mailing list
`
`databases.
`
`45.
`
`As a result of Charisma’s data compiling and sharing practices,
`
`companies can purchase and/or obtain mailing lists from Charisma that identify
`
`Charisma’s customers by their most intimate details such as their age, gender,
`
`
`
`18
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.19 Filed 08/05/21 Page 19 of 27
`
`income, marital status, and childrens' age. Charisma’s disclosures of such sensitive
`
`and private information puts consumers, especially the more vulnerable members of
`
`society, at risk of serious harm from scammers.
`
`46.
`
`Charisma does not seek its customers’ prior consent, written or
`
`otherwise, to any of these disclosures and its customers remain unaware that their
`
`Private Reading Information and other sensitive information is being rented and
`
`exchanged on the open market.
`
`47.
`
`Consumers can sign up for subscriptions to Charisma’s publications
`
`through numerous media outlets, including the Internet, telephone, or traditional
`
`mail. Regardless of how the consumer subscribes, Charisma never required the
`
`individual to read or affirmatively agree to any terms of service, privacy policy, or
`
`information-sharing policy during the relevant pre-July 31, 2016 time period.
`
`Consequently, during the relevant pre-July 31, 2016 time period, Charisma
`
`uniformly failed to obtain any form of consent from – or even provide effective
`
`notice to – its customers before disclosing their Private Reading Information.
`
`48.
`
`As a result, Charisma disclosed its customers’ Private Reading
`
`Information – including their reading habits and preferences that can “reveal
`
`intimate facts about our lives, from our political and religious beliefs to our health
`
`
`
`19
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.20 Filed 08/05/21 Page 20 of 27
`
`concerns”21 – to anybody willing to pay for it.
`
`49.
`
`By and through these actions, Charisma has intentionally disclosed to
`
`third parties its Michigan customers’ Private Reading Information without consent,
`
`in direct violation of the PPPA.
`
`CLASS ACTION ALLEGATIONS
`
`50. Plaintiffs seek to represent a class defined as all Michigan residents
`
`who, at any point during the relevant pre-July 30, 2016 time period, had their Private
`
`Reading Information disclosed to third parties by Charisma without consent (the
`
`“Class”). Excluded from the Class is any entity in which Defendant has a controlling
`
`interest, and officers or directors of Defendant.
`
`51. Members of the Class are so numerous that their individual joinder
`
`herein is impracticable. On information and belief, members of the Class number in
`
`the thousands. The precise number of Class members and their identities are
`
`unknown to Plaintiffs at this time but may be determined through discovery. Class
`
`members may be notified of the pendency of this action by mail and/or publication
`
`through the distribution records of Defendant.
`
`52. Common questions of law and fact exist as to all Class members and
`
`predominate over questions affecting only individual Class members. Common
`
`
`Exhibit Q, California’s Reader Privacy Act Signed into Law, Electronic
`21
`Frontier Foundation (Oct. 3,
`2011), https://www.eff.org/press/archives/2011/10/03 (last visited July 30, 2021).
`20
`
`
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.21 Filed 08/05/21 Page 21 of 27
`
`legal and factual questions include, but are not limited to: (a) whether Charisma is a
`
`“retailer or distributor” of publications (i.e., magazines); (b) whether Charisma
`
`obtained consent before disclosing to third parties Plaintiffs’ and the Class’s Private
`
`Reading Information; and (c) whether Charisma’s disclosure of Plaintiffs’ and the
`
`Class’s Private Reading Information violated the PPPA.
`
`53. The claims of the named Plaintiffs are typical of the claims of the Class
`
`in that the named Plaintiffs and the Class suffered invasions of their statutorily
`
`protected right to privacy (as afforded by the PPPA) as a result of Defendant’s
`
`uniform wrongful conduct, based upon Defendant’s disclosure of Plaintiffs’ and the
`
`Class’s Private Reading Information.
`
`54. Plaintiffs are adequate representatives of the Class because their
`
`interests do not conflict with the interests of the Class members they seek to
`
`represent, they have retained competent counsel experienced in prosecuting class
`
`actions, and they intend to prosecute this action vigorously. The interests of Class
`
`members will be fairly and adequately protected by Plaintiffs and their counsel.
`
`55. The class mechanism is superior to other available means for the fair
`
`and efficient adjudication of the claims of Class members. Each individual Class
`
`member may lack the resources to undergo the burden and expense of individual
`
`prosecution of the complex and extensive litigation necessary to establish
`
`Defendant’s liability. Individualized litigation increases the delay and expense to
`
`
`
`21
`
`
`
`Case 1:21-cv-00671 ECF No. 1, PageID.22 Filed 08/05/21 Page 22 of 27
`
`all parties and multiplies the burden on the judicial system presented by the complex
`
`legal and factual issues of this case. Individualized litigation also presents a potential
`
`for inconsistent or contradictory judgments. In contrast, the class action device
`
`presents far fewer management difficulties and provides the benefits of single
`
`adjudication, economy of scale, and comprehensive supervision by a single court on
`
`the issue of Defendant’s liability. Class treatment of the liability issues will ensu
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