In re Carrier IQ, Inc., Consumer Privacy Litig. - 78 F. Supp. 3d 1051 (N.D. Cal. 2015)

Rule:

The Federal Wiretap Act, 18 U.S.C. § 2510-2520, "is designed to prohibit 'all wiretapping and electronic surveillance by persons other than duly authorized law enforcement officials engaged in investigation of specified types of major crimes.' The Act defines the term "intercept" as the "aural or other acquisition of the contents of any wire, electronic, or oral communication through the use of any electronic, mechanical, or other device."

Facts:

Plaintiffs in this multidistrict litigation were eighteen individuals from thirteen different states. They filed a second consolidated amended complaint against Defendant Carrier IQ, Inc. and a number of manufacturers of mobile devices. Defendant designed, authored, programmed, and caused the installation and activation of the Software, including the so-called IQ Agent, on the devices at issue. It also designed, authored, and provided guides to the Device Manufacturers for designing, authoring, programming, installing, and activating the CIQ Interface in deployments through the "embedded" method of installation. The complaint alleged that defendants have violated the Federal Wiretap Act as well as a number of state's privacy and consumer protection statutes through the creation and use of defendant’s software on plaintiffs' mobile devices. Plaintiffs further allege that defendant designed, and the Device Manufacturers defendants embedded, the defendant’s software on their mobile devices and, once embedded, this software surreptitiously intercepted personal data and communications and transmitted this data to defendants and its customers. Pending before the court was the defendant’s joint motion to dismiss the plaintiff’s second amended complaint in its entirety. 

Issue:

Should the defendant’s joint motion dismissing plaintiff’s amended complaint in its entirety be granted?

Answer:

No.

Conclusion:

The Court granted in part and denied in part Defendants' motion to dismiss. Specifically, the Court dismissed the following claims with leave to amend: the Plaintiffs' Wiretap Act claim for failure to allege that the Device Manufacturers intentionally intercepted any communication as defined by the Wiretap Act. Plaintiffs' Cal. Penal Code § 502 claim for failure to specify which specific provisions of this section Defendants were alleged to have violated. Also, plaintiffs' implied warranty claim arising under California law was dismissed for failure to allege facts in support of an exception to California's privity requirement. Further, Plaintiff's Song-Beverly Act claim for failure to allege that any Plaintiff purchased a mobile device in California. Moreover, the court also dismissed plaintiffs' Unfair Competition Law claim to the extent it relies on allegedly unlawful conduct pending plaintiffs adequately alleging a violation of the Wiretap Act or a California law or regulation. Additionally, plaintiffs' claim under the Connecticut Unlawful Trade Practices Act was dismissed for failure to allege that defendants had a duty to disclose the existence and operation of the Carrier IQ Software under Connecticut law. Plaintiffs' claim under the Texas Deceptive Trade Practices Act was likewise dismissed for plaintiffs' failure to allege defendants' marketing efforts reached consumers or that their conduct was otherwise a producing cause of their injury as that phrase is interpreted by Texas courts. Plaintiffs' claim under the Washington Consumer Protection Act against HTC was dismissed to the extent it relies on HTC's failure to disclose the debug error. And, plaintiffs' implied warranty claims under the laws of Maryland, Michigan, and Texas were dismissed without prejudice for failure to provide pre-suit notice to the defendants. The Court dismissed, with prejudice, plaintiffs' claim under the Illinois Eavesdropping Law, 720 Ill. Comp. Stat. § 5/14-2(a)(1). Defendants' motion to dismiss was denied in all other respects as provided. The court likewise afforded plaintiffs a leave to file a third consolidated amended complaint.