Readers of this blog know that we often discuss consumer privacy claims surrounding the use of third-party pixel tracking software on consumer-facing websites. In a recent piece, we discussed a pixel tracking case that was dismissed for lack of standing. Following similar reasoning, a California federal court dismissed pixel tracking claims in a freshly issued decision. Below, we discuss: (1) the claims asserted in the lawsuit; (2) the decision and the judge’s corresponding reasoning; and (3) its implications for e-commerce companies.
Pixel Tracking Case Discussion
Plaintiff, on behalf of herself and a putative class, brought various privacy claims against a healthcare company arising out of its use of third-party pixel tracking software on the company’s website. As alleged in the complaint, Plaintiff claimed that Defendant shared website visitors’ data with third parties by “deploying tools and scripts developed by these companies that collected, transmitted, and processed information from users who accessed the [w]ebsite” without obtaining their prior consent. By allegedly doing so, Plaintiff asserted, among other things, that Defendant violated the federal Wiretap Act and the California Invasion of Privacy Act (“CIPA”). After Plaintiff filed an amended complaint, Defendant moved to dismiss.
Even after Plaintiff amended her complaint, the Court still found Plaintiff’s allegations to be insufficient to withstand dismissal for lack of Article III standing. To demonstrate standing, the Court explained that there must be a concrete and particularized injury in fact. In her papers, Plaintiff relied upon cases that survived dismissal on standing grounds. However, the Court contrasted those cases from the facts at issue in this litigation on the basis that the information that Defendant allegedly collected and shared was not, in fact, embarrassing, sensitive, or private. Other than listing the methods by which Defendant collected Plaintiff’s information, the Court found that she did not “allege that she provided any concrete details concerning her health profile beyond an age-related inference.” Because courts have repeatedly dismissed privacy claims premised on the collection of non-sensitive browsing activity, the Court followed precedent and found that Plaintiff lacked standing. Accordingly, the Court dismissed the amended complaint.
Is It Safe to Use Third-Party Pixel Tracking Tools on Your Website?
As with many ecommerce-related technologies, the use of third-party pixel tracking tools on consumer-facing websites is fraught with risk. As demonstrated by this decision, courts often look to the degree of invasiveness of the information collected and shared to determine whether pixel tracking claims are viable. Until something is done to curtail pixel tracking lawsuits, these proceedings almost certainly will continue to be commenced on a regular basis. Nonetheless, this latest decision is: (1) further evidence that pixel tracking claims are being viewed with more skepticism; and (2) another positive outcome for industry.
Businesses should routinely evaluate their use of third-party pixel tracking technology and associated data collection practices, particularly with respect to how consent is obtained from website visitors for the collection and use of their data. For years, the attorneys at Klein Moynihan Turco (“KMT”) have been assisting companies with federal and state marketing and privacy law compliance. In addition, the KMT litigation team has successfully defended countless businesses in pixel tracking proceedings. If your company employs pixel tracking software or has been served with a pixel tracking demand/lawsuit, please email us at info@kleinmoynihan.com or call us at (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice nor is it a substitute for seeking legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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