On April 28, 2011, the U.S. District Court for the Central District of California dismissed (with leave to amend) a class action complaint alleging that Specific Media, an online ad network, violated consumers’ privacy by using locally stored Flash objects (commonly called “LSOs” or “Flash cookies”) to capture online behavioral information. The case was one of several similar cases filed against various online ad networks (including Quantcast, Clearspring, Fox Entertainment Group, and VideoEgg) that were all consolidated into a single class action case last year. Specific Media was the only remaining defendant, as the other ad networks chose to enter into settlements with the plaintiffs.
Plaintiffs alleged that Specific Media used LSOs to circumvent controls of users who: a) had set their browsers to block the placement of third-party cookies by placing LSOs in the users’ browsers instead; or b) had deleted Specific Media’s HTTP cookies by using LSOs to “restore” Specific Media HTTP cookies. The plaintiffs further alleged that the information Specific Media obtained about them by using LSOs “has discernible value” and that Specific Media’s collection and use of that information “caused [them] economic loss.”
Plaintiffs asserted claims for relief under several different statutes, including the federal Computer Fraud and Abuse Act (18 U.S.C. § 1030), several California state statutes, including the computer crime statute (Cal. Penal Code § 502); Invasion of Privacy Act (Cal. Penal Code § 630); the Consumer Legal Remedies Act (Cal Civ. Code § 1750); unfair competition law (Cal. Bus. & Prof. Code § 17200), among others. In granting Specific Media’s motion to dismiss, the Court held that the plaintiffs did not have standing to bring an action because they did not specifically allege or show that they had suffered actual injury as a result of Specific Media’s actions.
The attorney for the plaintiffs said his clients plan to file a new complaint.
A copy of the court’s order can be found here.
