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Bernstein v. United Collection Bureau, Inc.

United States District Court, Ninth Circuit

November 5, 2013

MATHEW BERNSTEIN, individually and on behalf of all other similarly situated, Plaintiff,
v.
UNITED COLLECTION BUREAU, INC., Defendant.

ORDER DENYING DEFENDANT'S MOTION TO DISMISS [Dkt. No. 7]

GONZALO P. CURIEL, District Judge.

I. INTRODUCTION

Plaintiff, Mathew Bernstein, filed the present action individually and on behalf of all others similarly situated, against Defendant, United Collection Bureau, alleging violations of the California Invasion of Privacy Act §632, ("CIPA"). (Dkt. No. 1.) Defendant filed a Motion to Dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 7.) Plaintiff filed an opposition, (Dkt. No. 10), and Defendant filed a reply, (Dkt. No 12). Pursuant to L. Civ. R. 7.1.d.1, the Court finds the matter suitable for adjudication without oral argument. For the reasons stated below, the Court hereby DENIES Defendant's motion to dismiss.

II. FACTUAL BACKGROUND

This action pertains to a single phone call between the parties that allegedly violated California privacy law. Plaintiff alleges on February 19, 2013, an agent and employee of Defendant, United Collection Bureau, contacted Plaintiff via telephone to discuss a mutual client. (Dkt. No. 1, "Complaint" at 4, ¶¶ 7, 9). Plaintiff alleges Defendant recorded the conversation without his permission. (Id.) Plaintiff alleges the phone conversation included discussions protected by attorney-client privilege. (Dkt. No. 1. at 4, ¶ 9). Specifically, Plaintiff alleges the discussion concerned their mutual client's account balance, past due amount, last payment, and settlement offer, as well as personal and private financial information. (Dkt. No. 1 at 4, ¶¶ 9-10). Plaintiff alleges he was not aware of the recording until after he inquired as to whether the conversation was in fact being recorded. (Id.) When Defendant stated that the conversation was being recorded, Plaintiff responded, "I did not consent to that. Please do not record me in the future."(Id.) Defendant then promptly ended the call. (Id.) On May, 29, 2013, Plaintiff filed this suit alleging violation of the California Invasion of Privacy Act Section 632. (Dkt. No. 1.)

III. LEGAL STANDARD

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). To survive a motion to dismiss, the plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Bell Atlantic Corporation v. Twombly, 550 U.S. 544 (2007). A claim has facial plausibility, "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). While a plaintiff need not give "detailed factual allegations, " a plaintiff must plead sufficient facts that, if true, "raise a right to relief above the speculative level." Twombly, 550 at 545. "[F]or a complaint to survive a motion to dismiss, the non-conclusory factual content, ' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service, 572 F.3d 962, 969 (9th Cir.2009).

In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the truth of all factual allegations and must construe all inferences from them in the light most favorable to the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002). Legal conclusions, however, need not be taken as true merely because they are cast in the form of factual allegations. Ileto v. Glock, Inc., 349 F.3d 1191, 1200 (9th Cir. 2003). In practice, "a complaint... must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Twombly, 550 U.S. at 562.

IV. DISCUSSION

Defendant moves to dismiss Plaintiff's §632 CIPA claim arguing a service-monitoring exception precludes Plaintiff's entire action. (Dkt. No. 7 at 2-3.) In opposition, Plaintiff argues there is no service-monitoring exception to CIPA. (Dkt. No. 10 at 5.) In reply, Defendant contends Plaintiff failed to sufficiently allege the content of the recorded conversation was confidential in nature, as required under Section 632. (Dkt. No. 12 at 1.) Defendant further argues service-monitoring is a complete defense and CIPA is not intended to exclude service-monitoring. ( Id. at 3, 4, 6)

A. CIPA Service-Observing Exception

Section 632(a) of the California Invasion of Privacy Act states in relevant part:

Every person who, intentionally and without the consent of all parties to a confidential communication, by means of any electronic amplifying or recording device, eavesdrops upon or records the confidential communication, whether the communication is carried on among the parties in the presence of one another or by means of a telegraph, telephone, or other device, except a radio, shall be punished by a fine not exceeding two thousand five hundred dollars ($2, 500), or ...

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