A California federal district court has granted class certification in a lawsuit against a financial services company for tracking the activities of people using their website without prior notice to them. The lawsuit claims that the company used a third-party marketing software platform to track user activity on their website in violation of the California Invasion of Privacy Act (CIPA).
The software allowed the company to essentially record users' interaction with website forms in real time. Companies routinely use this type of software to create and maintain records of website users, particularly for marketing purposes.
The plaintiffs in this suit visited the company's website and provided personal information, which led to the creation of a "certificate" related to the website visit that existed for about one year. They claimed that the records of their activities were generated without their consent.
The company argued that the court should not grant class certification to the plaintiffs because it should determine each person's consent individually, not on a classwide basis. They also claimed that consent of the website users was implied from multiple sources, including its privacy policies and third-party materials.
The district court ultimately held that all website users involved common issues of law and fact in deciding to grant class certification. The court also reasoned that it later could refine the class definition according to the sources viewed by each user and identify each user by cross-referencing contact and location information.
While the granting of class certification does not represent an outcome based on the merits of the case, it still is a significant step toward a favorable outcome for the plaintiffs. Class certification also increases the potential damages and settlement value of the case.
The takeaway from the court's class certification in this case is that companies should ensure they are giving notice and getting consent from website users before tracking their activities.
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