Nike Asks for Stay in Wiretapping Case Pending Resolution of ‘Virtually Identical’ Appeal

According to a motion filed last Friday in Los Angeles, California, Nike Inc. has asked for a temporary stay of the action pending the Ninth Circuit’s decision in Johnson v. Blue Nile Inc., a case that it claims involves the same question of law under the California Invasion of Privacy Act. The instant consumer suit alleges that former co-defendant FullStory Inc. wiretapped the plaintiff’s communications with Nike during his visit to the retail giant’s website, that Nike aided and abetted the wiretapping, and that this conduct violated section 631 of the California Invasion of Privacy Act.

In September, Judge Fernando L. Aenlle-Rocha, issued an opinion on the defendants’ motion to dismiss, granting it in large part. The court permitted one of three claims for relief to proceed as to Nike for ostensibly aiding the alleged wiretapping.

In last week’s motion, Nike claimed that if the Ninth Circuit affirms dismissal of the parallel Blue Nile case, it will require dismissal of the instant action. In Blue Nile, the Northern District of California held that “the party exception barred a section 631 claim against a website operator that uses FullStory’s software-based service, [whereas] this Court held that it did not.”

Judge Aenlle-Rocha’s September 27 decision split with Blue Nile as well as other district court decisions, the defendant further explained. As such, the company argued that a temporary stay is necessary to ensure that the parties and the court do not squander time, effort, and resources engaging in discovery and class certification, only to learn that the plaintiff’s claim must be dismissed based on the appeal’s outcome. In the alternative, Nike requested that the court certify its September dismissal order for interlocutory appeal.

In support of a stay, Nike argued that it will suffer hardship whereas the delay will not prejudice the plaintiff. As to the latter, Nike contended that in cases where as here, the plaintiff  has sought monetary but not injunctive relief, courts routinely grant stays.

As to its proposed alternative, Nike alleged that it seeks certification of a controlling question of law ripe for appellate adjudication. In support of this argument, Nike claimed that statutory interpretation impacting whether a pleading states a claim is a type of uncertainty commonly certified for interlocutory appeal.

The hearing is set for November 19. The online shopper and putative class are represented by Bursor & Fisher P.A., and Nike by Covington & Burling LLP.