Judge David S. Cunningham, Case Number: JCCP5298, Date: 2023-10-20 Tentative Ruling

Moving Party: The Neiman Marcus Group LLC, Doximity Inc., Deckers Outdoor Corp., HarperCollins Publishers LLC, Resident Home LLC, CCBill, LLC, and Malwarebytes, Inc. (collectively “Petitioners”)

Opposing Party: Nora Gutierrez (“Gutierrez”), Anne Heiting (“Heiting”), Brittney Ramirez (“Ramirez”), Miguel Licea (“Licea”), and Silvia Garcia (“Garcia”)

Licea and Garcia’s request for judicial notice is granted in full. The documents are court records. The Court judicially notices the existence of the documents.

Petitioners submitted a petition to the Chairperson of the Judicial Council for pretrial coordination of two cases (the “Included Actions”):

* Gutierrez v. Resident Home LLC, Case No. 23STCV09554 (Los Angeles Superior Court);

* Heiting v. HarperCollins Publishers LLC, Case No. 23STCV10382 (Los Angeles Superior Court);

* Ramirez v. The Neiman Marcus Group LLC, Case No. 23STCV10451 (Los Angeles Superior Court);

* Ramirez v. Deckers Outdoor Corp., Case No. 23STCV15919 (Los Angeles Superior Court);

* Licea v. Levi Strauss & Co., Case No. 23STCV17313 (Los Angeles Superior Court); and

* Licea v. Malwarebytes, Inc., Case No. CIVSB2224245 (San Bernardino Superior Court).

The Included Actions are six putative class actions and two individual actions. The complaints allege that Petitioners violated the California Invasion of Privacy Act (“CIPA”) “by including software embedded on [their] respective websites to record and eavesdrop on consumers’ communications through live chat functions.” (Petitioners’ Memorandum of Points and Authorities (“MP&A”), pp. 2-3.)

The Chief Justice and Chair of the Judicial Council issued an order assigning this Court to sit as the coordination motion judge to determine whether the Included Actions are complex and, if so, whether coordination is appropriate.

Only “complex” cases may be coordinated. (Edmon & Karnow, Cal. Practice Guide: Civ. Procedure Before Trial (The Rutter Group June 2023 Update) ¶ 12:374.5.) A “complex” case requires “exceptional judicial management to avoid placing unnecessary burdens on the court or the litigants and to expedite the case, keep costs reasonable, and promote effective decision making by the court, the parties, and counsel.” (Cal. Rules of Court, rule 3.400(a).)

[T]he Court must consider, among other things, whether the action is likely to involve:

(1) Numerous pretrial motions raising difficult or novel legal issues that will be time-consuming to resolve;

(2) Management of a large number of witnesses or a substantial amount of documentary evidence;

(4) Coordination with related actions pending in one or more courts in other counties, states, or countries, or in a federal court; or

[A]n action is provisionally a complex case if it involves one or more of the following types of claims:

Gutierrez v. CCBill, LLC, Gutierrez v. Resident Home LLC, Garcia v. Doximity Inc., Heiting v. HarperCollins Publishers LLC, Ramirez v. The Neiman Marcus Group LLC, and Licea v. Levi Strauss & Co. have already been deemed complex and are pending in complex courtrooms.

Licea v. Malwarebytes, Inc. is provisionally complex since it alleges class claims.

Petitioners represent that Ramirez intends to amend the complaint to add class allegations in Ramirez v. Deckers Outdoor Corp. (See Petitioners’ MP&A, p. 11.) Regardless, the Court is persuaded that the case will involve difficult and novel pretrial motions regarding CIPA.

Nevertheless, as explained next, the Court finds that coordination should be denied.

Section 404.1 states that a petition for coordination should be granted if doing so will “promote the ends of justice,” taking into account the following seven factors:

whether the common question of fact or law is predominating and significant to the litigation; the convenience of parties, witnesses and counsel; the relative development of the actions and the work product of counsel; the efficient utilization of judicial facilities and manpower; the calendar of the courts; the disadvantages of duplicative and inconsistent rulings, orders, or judgments; and the likelihood of settlement of the actions without further litigation should coordination be denied.

Petitioners contend common questions predominate because the Included Actions “present virtually identical questions of law” concerning CIPA’s “applicab[ility] to communications sent via Petitioners’ respective website chat functions.” (Petitioners’ MP&A, p. 12.)

Gutierrez, Heiting, and Ramirez disagree. They claim “all of the cases relate to different defendants, using different third party software for different stated objectives.” (Gutierrez, Heiting, and Ramirez’s Opposition, p. 3.) They contend “there are vastly different factual questions to be litigated for each respective party, and each respective chat service employed.” (Ibid. [stating that “all demurrers have been overruled in state court to which the undersigned has been a party, so it isn’t clear there would be inconsistent rulings as to how the law applies”].)

It is beyond dispute that the eight Actions all involve different commercial websites as reflected in the allegations of the respective complaints filed in the Actions. [Citation.] Notably, such difference in websites and other factual differences were cited by attorneys of the Sheppard, Mullin, Richter & Hampton LLP law firm, which is the same law firm that represents Petitioners The Neiman Marcus Group LLC, Doximity Inc., Deckers Outdoor Corporation, and Levi’s Strauss & Co., as reasons why a similar federal district court action alleging violations of [Penal Code] section[s] 631(a) and 632.7 should not be transferred to the case calendar of a federal district judge who was already assigned to handle several other similar cases. In particular, on May 5, 2023, defendant Skullcandy Inc. filed “Defendant Skullcandy Inc.’s Opposition to Plaintiff Annette Cody’s Notice of Related Cases” in a federal district court action entitled Cody v. Skullcandy Inc., No. 2:23-cv-03356-CAS-SK, Doc. 8 (C.D. Cal. notice of removal filed May 3, 2023), while represented by the Sheppard, Mullin, Richter & Hampton LLP law firm. [Citation.] That Opposition argued that: (1) “[t]he allegations in Plaintiff’s complaint in three matters exhibit entirely different transactions, happenings, and events,” [citation]; (2) “There are three separate and distinct websites, owned and controlled by different companies, different IT departments, and discrete policies and terms and conditions controlling their websites and ‘transactions’ with their users,” [citation]; (3) “There are three separate and unique groups of employees and corporate individuals,” [citation]; (4) “Plaintiff’s allegations do not reflect the same third-party ‘spyware,’” [citation]; (5) “the facts necessary to resolve those claims are completely distinct,” [citation], and (6) “Each of these defendants has a distinct and unique website, policies, and employees, making the facts entirely different,” [citation].

It is beyond dispute that the operative pleadings in the Actions allege that different chat software is at issue in each of the eight Actions. Indeed, the Petition does not even indicate that any overlap exists with respect to the chat software involved in the eight Actions. This is not surprising because: (1) the chat provider in the Malwarebytes Action is Ada, Inc., [citation]; (2) the chat provider in the Levi Strauss Action is believed to be ZenDesk, [citation]; (3) the chat provider in the Doximity Action is believed to be Hubspot, Appcues, or Zopim, [citation]; (4) the chat provider in the Neiman Marcus Action is Twilio.com, [citation]; (5) the chat provider in the CCBill Action is Live Chat, Inc., [citation]; (6) the chat provider in the Deckers Action is Gladly, [citation]; (7) the chat provider at issue in the Resident Home Action is Five9, [citation]; and (8) the chat provider at issue in the Harpercollins Action is Tawk.to, Inc., [citation].

Furthermore, each of the websites in the Actions surely have different disclosures to website users about the use of the chat feature including the use of the users’ chat data. The Petition’s argument that the Actions “attack[] virtually the same policies and practices with respect to website chat functions,” [citation], is totally unsubstantiated. What policies and practices do any of the Petitioners have that ensure the disclosure of their respective chat providers’ data harvesting practices to their website chat feature users? These factual details are relevant to the issue of consent, which defendants in similar cases have commonly asserted as a defense in pretrial motions challenging the validity of claims under sections 631(a) and 632.7[.]

(Licea and Garcia’s Opposition, pp. 10-11, emphasis in original, underlined case names added; see also id. at pp. 12-14.)

In reply, Petitioners attempt to analogize the Social Media Cases (JCCP 5255), the Cellphone Termination Fees Cases (JCCP 4332), and the Gift Card Cases II (JCCP 4362). They claim those cases were coordinated because they raised common legal questions despite involving several differences – e.g., websites, retailers, consumers, customer contracts, and disclosures. (See Reply, pp. 2-3.) Petitioners contend the same result should be ordered here because each case “has the same legal and factual theory at its heart – namely, have privacy rights been violated when a third-party provider operates chat boxes on commercial websites.” (Id. at p. 3.)

This factor favors denial. The putative classes do not overlap. Each complaint is brought by a different group of consumers against a different named Defendant. (See Ramsey Decl., Ex. A, ¶¶ 6-8, Ex. B, ¶¶ 5-6, Ex. D, ¶¶ 6-8, Ex. E, ¶¶ 6-8, Ex. F, ¶¶ 6-7, Ex. G, ¶¶ 5-7, Ex. H, ¶¶ 5-6, Ex. I, ¶ 4.) Each website is different, and each chat provider is different. (See id. at Ex. A, ¶¶ 9, 14, Ex. B,, p. 2:2-2:6, ¶ 10, Ex. D, ¶¶ 9, 15, Ex. E, ¶¶ 6, 9, 13, Ex. F, ¶¶ 1, 9, Ex. G, ¶¶ 5, 8-9, Ex. H, p. 2:2-2:6, ¶ 10, Ex. I, p. 2:2-2:8, ¶ 27.) Consequently, it is probable that the websites have different disclosures and other material differences, and it is improbable that analyzing one Defendant’s website would bear on analysis of another Defendant’s website. Individual issues predominate.

The Social Media Cases are distinguishable. This Court ruled on the petition for coordination in the Social Media Cases. It was unopposed. The various parties wanted coordination and only disagreed as to which Superior Court location should be assigned to oversee the coordinated proceedings. Unlike here, there was a high risk of inconsistent rulings. The cases were individual actions. Each complaint named at least one social media company as a defendant. Each defendant was sued in multiple cases, though not all defendants were sued in all of the cases. Multiple judges in multiple counties would have had to analyze the same social media apps (e.g., Snapchat) and the same company conduct related to those apps if coordination had been denied.

The Cellphone Termination Fees Cases (2003) and the Gift Card Cases II (2004) were coordinated approximately 20 years ago.[1] The Court is unfamiliar with them and the reasons why they were coordinated. Petitioners’ evidence fails to demonstrate that they are, in fact, analogous. (See, e.g., Reply Cardon Decl., Ex. B [attaching a post-coordination status conference statement addressing motion scheduling].)

The circumstances here, in 2023, tip the scale toward denial. To repeat, each Included Action involves a different group of consumers, a different Defendant, a different website, and a different chat provider. There is little to no overlap. Commonality is lacking.

This finding does not bar Petitioners from moving to relate the Los Angeles cases. Seven of the eight Included Actions are pending in Los Angeles. Petitioners remain free to try to bring them together before one Los Angeles judge (the Court declines to opine on whether relation is appropriate).[2]

Absent coordination, counsel for Petitioners must defend separate but nearly identical lawsuits, involving nearly identical putative class members, and attacking virtually the same policies and practices with respect to website chat functions. Counsel for Petitioners would likely have to prepare and respond to multiple sets of substantially similar discovery and briefs on dispositive and other issues. Further, all Actions allege or will allege state-side classes; thus, one site is not more or less convenient for those purported class members.

(Petitioners’ MP&A, pp. 12-13; see also Reply, p. 7 [“Coordination will permit counsel to litigate the Actions in a streamlined proceeding, in one court, with one set of hearings, rather than in numerous lawsuits across different counties, all proceeding at different times, in different orders, and so forth. . . .”].)

It is not clear how coordination would make litigation more convenient for anyone besides some of the defendants’ counsel who have overlapping clients. It is not sufficient that counsel for some defendants will be “forced to bring the same motions in different courts.” If the cases were so similar, this would not be such an arduous task. No other benefit is cited in the moving papers with respect to convenience, and none exists. Rather, as this petition itself indicates, coordination would only create more complexity and more paper, which would be decidedly inconvenient.

The Petition’s argument that the Actions “involve[e] nearly identical putative class members,” is completely inaccurate and totally unsubstantiated. How do Defendants know whether the “putative class members” in the Levi Strauss Action regarding the website at https://www.dockers.com are identical to the “putative class members” in the Malwarebytes Action regarding the website at https://www.malwarebytes.com? How do Defendants know whether the “putative class members” in the Neiman Marcus Action regarding the website at https://www.neimanmarcus.com/ are identical to the “putative class members” in the Doximity Action regarding the website at https://www.doximity.com? Why would the “putative class members” in the CCBill Action regarding the website at https://ccbill.com be identical to the “putative class members” in the Deckers Action regarding the website at https://www.sanuk.com[?] Why would the “putative class members” in the Resident Home Action regarding the website at https://www.nectarsleep.com be identical to the “putative class members” in the Harpercollins Publishers Action regarding the website at https://www.harpercollins.com?

Similarly . . . , the Petition’s argument that the Actions “attack[] virtually the same policies and practices with respect to website chat functions,” [citation], is totally unsubstantiated. The notion that the parties shall prepare and respond to “substantially similar discovery,” [citation], given the significant factual differences amongst the Actions is simply wishful thinking.

(Licea and Garcia’s Opposition, pp. 14-15, footnotes omitted, underlined case names added.)

This factor favors denial. Deciding common issues in one forum typically conveniences the parties, witnesses, and counsel, but the current situation is different. Again, the putative classes do not overlap, the named Defendants differ, the websites differ, and the chat providers differ. Witnesses will differ as well. Because individual issues predominate, coordination would be inconvenient.

This factor is neutral or favors denial. In Gutierrez v. CCBill, LLC, “discovery has already been served and responded to.” (Gutierrez, Heiting, and Ramirez’s Opposition, p. 4.) In Licea v. Malwarebytes, Inc., the Defendant’s “demurrer to the First Amended Complaint was fully briefed, heard at oral argument, and decided by the Superior Court” in July 2023. (Licea and Garcia’s Opposition, p. 15; see also Petitioners’ MP&A, p. 13 [conceding that the demurrer “was heard and decided”]; Reply, p. 4.) Moreover, both sides in Licea have propounded written discovery. (See Licea and Garcia’s Opposition, pp. 15-16; see also Reply, pp. 4-5.) Weighing the different stages of litigation and, more importantly, the lack of overlapping putative classes, the Court doubts that coordinating discovery and motion practice would provide the usual benefits and efficiencies.

This factor favors denial. For the reasons stated in sections II.A. and II.B, the threat of separate courts duplicating case efforts on the same issues and claims is low.

This factor is neutral. Petitioners’ brief fails to address the specific, individual court calendars.

This factor favors denial. The analysis is the same as sections II.A., II.B., and II.D.

Petitioners assert that, without coordination, “piecemeal settlement of any Action is less likely for some, if not all, Actions considering the risk that the courts could rule inconsistently on the same legal issues.” (Petitioners’ MP&A, p. 14, footnote omitted; see also Reply, p. 9.)

This factor is neutral or favors denial. The inquiry is not whether coordination would promote settlement; it is whether settlement is expected “without further litigation should coordination be denied.” (Code Civ. Proc. § 404.1.) Petitioners’ own moving papers suggest that numerous similar cases have settled independent of coordination. (See Ramsey Decl., ¶ 3 [“Attached hereto as Exhibit J is a chart listing, as of June 9, 2023, the cases of which counsel is aware that were filed by counsel for Plaintiffs in the Actions. In many instances, the Defendants in those actions have not joined as Petitioners because the actions have settled or will settle[] shortly.”], bolding and underlining in original, italics added.) The settlement process appears to be working fine under the current situation. In light of the predominating individual issues, the Court believes that coordination would have either no impact or a negative impact on settlement.

On balance, the coordination factors support denial. The Court finds that the petition for coordination should be denied.

Rule of Court 3.530(b) sets forth the factors that the coordination motion judge may consider in making a recommendation for the site of the coordination proceedings. The factors include: the number of included actions in particular locations; whether the litigation is at an advanced stage in a particular court; the efficient use of court facilities and judicial resources; the locations of witnesses and evidence; the convenience of the parties and witnesses; the parties' principal places of business; the office locations of counsel for the parties; and the ease of travel to and availability of accommodations in particular locations. (Cal. Rules of Court, rule 3.530(b).)

Petitioners ask the Court to stay the Included Actions pending coordination. (See Petitioners’ MP&A, p. 14.)

[1] (See https://www.courts.ca.gov/documents/CivilCaseCoordArchive_2017andOlder_JCCPLog.pdf.)

[2] As noted above, Licea and Garcia highlight statements and rulings made in allegedly similar federal lawsuits. (See Licea and Garcia’s Opposition, pp. 10-11, 12-14; see also Reply, pp. 5-6 [arguing that the statements and rulings are irrelevant].) While the Court agrees that individual issues predominate, the Court’s finding is not based on, and does not depend on, the events in the federal cases.