Facebook Hit With $15B Complaint In User Tracking MDL (Law360)

By Stewart Bishop

Facebook Inc. was hit Thursday with a $15 billion amended complaint in California federal court in a multidistrict litigation accusing the company of improperly tracking users' Internet habits even after they logged out of their accounts.

The suit is the result of the consolidation of 21 related cases filed in numerous states in 2011 and 2012, according to Stewarts Law US LLP, which is one of the lead firms representing the plaintiffs.

"This is not just a damages action, but a groundbreaking digital privacy rights case that could have wide and significant legal and business implications," Stewarts said in a statement.

When a user is logged on to Facebook, the site mandates that users accept numerous Facebook small text files, called cookies, on to the user's computer, which allows Facebook to see its users' electronic communications and track browsing history, according to the suit.

While Facebook tells its users that such tracking is limited to Internet usage while users are logged in to Facebook, the plaintiffs maintain the social networking giant is tracking users' Web browsing activity after they log out.

"Even though Facebook assures its users that it does not track their Internet browsing post-logout, Facebook has been doing exactly that," the suit said.

For example, when a user logs out of Facebook and visits another site that has any type of Facebook content integrated into the site, the Facebook server is notified of that communication, according to the suit.

The suit claims that neither Facebook users nor the third-party websites have given consent or otherwise authorized Facebook to intercept, store and track users' electronic communications while not logged in to the site.

The plaintiffs are alleging invasion of privacy, intrusion upon seclusion and trespass to chattels, violations of the Federal Wiretap Act, the Stored Communications Act and Computer Fraud and Abuse Act, and numerous violations of California law.

In February, several class actions accusing Facebook of improperly tracking the Internet activity of its users were consolidated in the Northern District of California, after a judicial panel found that centralization in Northern California will serve the convenience of the parties and witnesses and "promote the just and efficient conduct of this litigation."

The court is 15 miles away from Facebook's Silicon Valley headquarters, according to the suit.

The first bid to consolidate the cases was filed in October 2011 by the plaintiffs in the proposed class action Davis v. Facebook. The Davis suit was launched after a blogger showed that Facebook had the ability to know at any time if a person visited a Web page with a Facebook like button or share button, even if that person had logged out of the service.

In a brief supporting the consolidation, attorneys in the Davis suit said that Facebook had violated its own user agreement by making new users provide "sensitive personal information to Facebook upon registration ... [and] accept numerous Facebook cookies, which track browsing history."

Other class actions that made identical claims against Facebook and that are now parties in the MDL litigation were filed in California, Texas, Illinois, Arizona, Missouri, Kansas, Alabama, Kentucky, Mississippi and Louisiana.

A Facebook spokesman, Andrew Noyes, was dismissive of the amended complaint.

"We believe this complaint is without merit and we will fight it vigorously," Noyes said in a statement.

The plaintiffs are represented by Edward D. Robertson, Jr., James P. Frickleton, Mary D. Winter and Edward D. Robertson III of Bartimus Frickleton Robertson & Gorny PC, Paul R. Kiesel of Kiesel Boucher & Larson LLP and David A. Straite, Ralph N. Sianni, Michele S. Carino and Lydia E. York of Stewarts Law US LLP, among others.

Facebook is represented by Michael G. Rhodes, Matthew D. Brown and Jeffrey M. Gutkin of Cooley LLP.

The case is In re: Facebook Internet Tracking Litigation, case number 5:12-md-02314, in the U.S. District Court for the Northern District of California.

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