United States: First Circuit Subscribes To A Minority View: Free App Users Allowed To Proceed With Privacy Class Action Under The Video Privacy Protection Act

In Yershov v. Gannett Satellite Information Network, Inc., 2016 U.S. App. LEXIS 7791 (1st Cir. Apr. 29, 2016), the First Circuit held that users of free mobile applications, or "apps," can bring a claim against an online service provider if the provider shares with third-party data analytics companies the users' personally identifiable information and information about videos the users viewed on the app. The court's holding departs from the majority of courts that have ruled on this issue and reached the opposite conclusion.

Alexander Yershov, the plaintiff, installed a USA Today mobile app on his Android phone. In a class action complaint, Yershov alleges that every time an app user viewed a video, the defendant, Gannett Satellite Information Network, Inc. (USA Today's parent), shared with a third-party data analytics company: (1) information about the video the user viewed; (2) the user's GPS coordinates; and (3) the unique identification number of the user's smartphone, called an "Android ID."

The Video Privacy Protection Act ("VPPA"), 18 U.S.C. § 2710, under which Yershov brought his claim, prohibits "video tape service providers" from disclosing "personally identifiable information" ("PII") concerning a "consumer" to third parties. 18 U.S.C. § 2710(b). Prior district and appellate courts' decisions on this statute have turned on defining the latter two terms—first, whether the above information that Gannett disclosed constituted "personally identifiable information," and, second, whether free app users qualify as "consumers."

The First Circuit affirmed the district court's holding on the first issue, concluding that the express language used to define PII was broad enough to encompass the information Gannett shared about its users. The VPPA defines PII as "includ[ing] information which identifies a person as having requested or obtained specific video materials or services from a video tape service provider." Yershov, 2016 U.S. App. LEXIS 7791, at *6 (quoting 18 U.S.C. § 2710(a)(3) (emphasis added)). In interpreting PII, the First Circuit held that Congress did not intend to define PII so narrowly as to limit it to information that explicitly names a person, as Gannett argued. Instead, the Court reasoned, "[M]any types of information other than a name can easily identify a person." Id. Because the users' Android IDs and GPS locations given to the analytics company were sufficient information for the company to reverse engineer the users' identities, the Court held that this information constitutes PII. See generally Yershov v. Gannett Satellite Information Network, Inc., 104 F. Supp. 3d 135, 143 (D. Mass. 2015).

The First Circuit, however, reversed the district court's holding on the second issue, concluding that free app users indeed qualify as "consumers." The VPPA provides that "consumer" means "any renter, purchaser, or subscriber of goods or services from a video tape service provider." Yershov, 2016 U.S. App. LEXIS 7791, at *6 (quoting 18 U.S.C. § 2710(a)(1)). Yershov limited his arguments to whether he was a "subscriber" as used in this definition. Id. at *8. Because the VPPA does not define "subscriber," the Court acknowledged several dictionary definitions of the term, some of which include payment as an element. See id. at *10. But, as a matter of statutory construction, the Court reasoned that the terms preceding "subscriber"—"renter" and "purchaser"—would render payment a "superfluous" requirement. Id. at *11-12. Indeed the Court noted that in 1988, when the statute was enacted, individuals who paid for a copy of a video either retained ownership of it outright (thereby becoming a "purchaser") or temporarily (thereby becoming a "renter"). Id. at *12. The Court determined that because "subscriber" does not fit into this scheme, it must necessarily exclude a payment requirement. See id.

In reaching its decision, the Court acknowledged the recent decision in Ellis v. Cartoon Network, Inc., 803 F.3d 1251, 1256-58 (11th Cir. 2015), which held that a person cannot be a "subscriber" without making a monetary payment. It also held that a person could not qualify as a "subscriber" where he/she did not "sign up for or establish an account" or "make any commitment or establish any relationship that would allow . . . access to exclusive or restricted content." Yershov, 2016 U.S. App. LEXIS 7791, at *14-15 (quoting Ellis, 803 F.3d at 1257). The Eleventh Circuit analogized downloading an app to saving a particular website as a favorite on an internet browser. Id. at *15-16 (citing Ellis, 803 F.3d at 1257).

The First Circuit, however, disagreed with the Eleventh Circuit's analysis, stating that the Eleventh Circuit erred in presuming that the plaintiff there did not "provide any information." Id. at *15 (emphasis added). The First Circuit held that while "Yershov paid no money, access was not free of a commitment to provide consideration in the form of that information, which was of value to Gannett." Id. (quoting Ellis, 803 F.3d at 1254). Unlike with internet browsing, by installing the app on his phone, "Yershov . . . provide[d] Gannett with personal information, such as his Android ID and his mobile device's GPS location at the time he viewed a video, each linked to his viewing selections." Id. This access to the app's content in exchange for his information, the Court determined, satisfied the definition of "subscriber." Id. at *16-17.

The district court acknowledged that interpreting the VPPA "involves an attempt to place a square peg (modern electronic technology) into a round hole (a statute written in 1988 aimed principally at videotape rental services)." Yershov, 104 F. Supp. 3d at 140. Still, despite the disconnect, the First Circuit felt bound to apply the statute as written.

Whether Yershov v. Gannett Satellite Information Network, Inc. will redirect the trend on "app users" privacy class actions is unknown, as is its effect on the app market, specifically how information is shared with third-party data analytics companies.

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