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In re Facebook Internet Tracking Litigation

United States District Court, N.D. California, San Jose Division

November 17, 2017

In re Facebook Internet Tracking Litigation

          ORDER GRANTING DEFENDANT'S MOTION TO DISMISS RE: DKT. NO. 162

          EDWARD J. DAVILA UNITED STATES DISTRICT JUDGE

         Plaintiffs' third amended complaint alleges that Defendant Facebook, Inc. violated its contractual obligations by tracking logged-out Facebook users on third-party websites. Facebook now moves to dismiss for the third time. Facebook's motion will be granted.

         I. BACKGROUND

         In this putative class action, Plaintiffs allege that Facebook improperly tracked the web browsing activity of logged-out Facebook users on third-party websites.[1] Third Am. Compl. ("TAC"), Dkt. No. 157. Plaintiffs previously asserted a variety of common law claims and claims for violations of federal and state statutes. After two rounds of motions to dismiss, this Court dismissed the majority of Plaintiffs' claims with prejudice for lack of standing and for failure to state a claim. Order Granting Def's Mot. to Dismiss ("MTD Order"), Dkt. No. 148. This Court granted leave to amend only as to Plaintiffs' claims for breach of contract and breach of the duty of good faith and fair dealing. Id. Plaintiffs timely filed their third amended complaint. Facebook now moves to dismiss under Fed.R.Civ.P. 12(b)(6) and 15(c). Def's Mot. to Dismiss ("MTD"), Dkt. No. 162.

         II. LEGAL STANDARD

         A motion to dismiss under Fed.R.Civ.P. 12(b)(6) tests the legal sufficiency of claims alleged in the complaint. Parks Sch. of Bus.. Inc. v. Symington. 51 F.3d 1480, 1484 (9th Cir. 1995). Dismissal "is proper only where there is no cognizable legal theory or an absence of sufficient facts alleged to support a cognizable legal theory." Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). The complaint "must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twomblv. 550 U.S. 544, 570 (2007)).

         III. DISCUSSION

         Plaintiffs' TAC asserts causes of action for (1) breach of contract (TAC ¶¶ 139-48) and (2) breach of the duty of good faith and fair dealing (TAC ¶¶ 149-61). Plaintiffs also seek to enlarge the scope of the proposed class.

         A. Breach of Contract

         Plaintiffs allege that each of them entered into a contract with Facebook that consisted of (1) Facebook's Statement of Rights and Responsibilities ("SRR"), (2) Facebook's Privacy Policy, and (3) relevant pages from Facebook's Help Center. TAC ¶ 140. According to Plaintiffs, Facebook promised in the contract that it would not track the web browsing activity of logged-out Facebook users on third-party websites. Id. ¶ 142. Plaintiffs allege that Facebook broke that promise by collecting data about logged-out users' browsing activity and using cookies to connect that activity to users' identities. Id.

         To state a claim for breach of contract, Plaintiffs must allege that (1) they entered into a contract with Facebook, (2) Plaintiffs performed or were excused from performance under the contract, (3) Facebook breached the contract, and (4) Plaintiffs suffered damages from the breach. Oasis W. Realty. LLC. v. Goldman. 51 Cal.4th 811, 821 (2011) (citing Reichert v. General Ins. Co., 68 Cal. 2d 822, 830 (1968)). "In an action for breach of a written contract, a plaintiff must allege the specific provisions in the contract creating the obligation the defendant is said to have breached." Woods v. Google Inc.. No. 05:ll-cv-1263-JF, 2011 WL 3501403, at *3 (N.D. Cal. Aug. 10, 2011).

         The parties agree that the SRR constitutes a contract. MTD 8; Pis.' Opp'n to Def's Mot. to Dismiss ("Opp'n"), Dkt. No. 163. However, the SRR itself does not contain a promise to not track logged-out users. Rather, Plaintiffs argue that the operative contract is a combination of provisions from Facebook's SRR, Facebook's Privacy Policy, [2] and Facebook's Help Center pages.[3]

         i. The Data Use Policy was not incorporated by reference into the Statement of Rights and Responsibilities.

         Plaintiffs cite the following language from Facebook's Data Use Policy (dated September 7, 2011):

We receive data whenever you visit a . . . site with a Facebook feature (such as a social plugin). This may include the date and time you visit the site; the web address, or URL, you're on; technical information about the IP address, browser and the operating ...

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