Nike, FullStory Move to Dismiss Screen Recording Suit

On Friday, Nike and FullStory filed a motion to dismiss the screen recording class-action lawsuit brought against them by a consumer in the Central District of California. The motion asserted that the plaintiff’s allegations fail because the court lacks personal jurisdiction over FullStory and because the plaintiff failed to state a claim under which he is entitled to relief or a claim for invasion of privacy.

The consumer filed this class-action lawsuit against Nike and FullStory, a marketing software-as-a-service company, for allegedly wiretapping visitors’ electronic communications by recording their sessions on Nike’s website without disclosing this conduct or obtaining visitor permission. The plaintiff later amended the complaint, adding more details about Nike’s privacy policy.

Now, the defendants aim to dismiss the plaintiff’s amended complaint. Nike claimed that it uses FullStory’s software and services to “understand and improve” the website’s functionality, which “allows Nike to improve the user experience for visitors.” Nike reiterated that it added FullStory’s software code to its website in order to utilize this service by collecting certain information from visitors, which “is used to inform the analytics that FullStory provides Nike.” The defendants contend that “this case is about a retailer’s ability to understand how its website is functioning and how users are interacting with the website to ensure a smooth, error-free experience for the website visitors.” However, according to Nike and FullStory, the plaintiff “seeks to criminalize this behavior,” explaining that the plaintiff’s claims that “this routine internet functionality amounts to unlawful wiretapping and eavesdropping are meritless.”

Nike and FullStory averred that the court should dismiss the plaintiff’s first amended complaint because the court lacks personal jurisdiction over FullStory, which is based in Georgia and incorporated in Delaware. In particular, the defendants claimed that the complaint is “devoid of any allegations of forum-related conduct by FullStory,” and failed to establish jurisdiction over FullStory.

The defendants proffered that the plaintiff “failed to state any claim under which he is entitled to relief.” Specifically, the plaintiff’s California Invasion of Privacy Act (CIPA) claims purportedly fail because the defendants “were the recipients of Plaintiff’s communications and thus fit within CIPA’s well-recognized party exception.” The defendants added that FullStory is not a third-party, rather it is “an extension of Nike,” and the defendants cannot “be held liable for eavesdropping under the party exception.” Additionally, the defendants stated that the plaintiff failed to allege the “‘contents’ of his communications were intercepted.” Moreover, Nike and FullStory asserted that “none of the data collection alleged in the (First Amended Complaint) is surreptitious,” as required by CIPA because, according to the defendants, it is fully disclosed in Nike’s privacy policy.

Furthermore, the defendants alleged that the plaintiff failed to state a claim under the California Constitution for invasion of privacy because the plaintiff “cannot plausibly allege that he held a reasonable expectation of privacy in the information Defendants allegedly collected because Plaintiff himself intentionally sent it to the Defendants.” Nike and FullStory noted that the plaintiff has also not plausibly alleged that said data collection “constitutes an ‘egregious breach of social norms.’”

Nike and FullStory are represented by Covington & Burling. The plaintiff is represented by Bursor & Fisher, P.A.