Tag: trespass to chattel

January 12, 2024 Copyright, Unfair Competition

Google did not “trespass” on websites by placing ads in mobile app

trespass to chattels

Google’s Search App in the Android environment worked much like any web browser. When a user typed in a web address, the app would connect to the host web server and deliver up a copy of the requested web page to be viewed in the app. Between 2018 and 2020, Google configured the app so that a frame at the bottom of the screen accompanied the requested page. A user could click to expand the frame to display larger advertising banners. Google did not pay the owners of the websites over which these banners were displayed. The ads were triggered automatically using algorithms, presumably based on the content of the requested website.

A group of website operators sued Google in federal court, seeking to make the case into a class action. Plaintiffs asserted a number of claims under California law, including trespass to chattels and unjust enrichment. Google filed a motion to dismiss the case for failure to state a claim upon which relief could be granted. The lower court denied the motion to dismiss. Usually, a party who loses a motion to dismiss does not yet have the opportunity to appeal such a decision (that right is normally reserved for final decisions of a court). In this case, however, the court permitted Google to seek review of the denial of the motion to dismiss. On appeal, the Ninth Circuit reversed the lower court’s decision and ordered that the case be dismissed.

No trespass to chattels

Trespass to chattels is a tort that enables a party to recover when another has interfered with possession of personal property. It is in the nature of theft (what in civil proceedings would be called “conversion”) but “not sufficiently important to be classified as conversion”. Plaintiffs’ theory essentially was that when Google placed ads on top of their web pages, Google was messing with plaintiffs’ possessory interest in plaintiffs’ web pages. The “chattels” at issue were the copies of the web pages.

The court held that plaintiffs’ trespass to chattels claim failed because they did not allege a sufficient possessory interest in the copies of their web pages, nor did they allege an appropriate property interest in the pages.

As for the lack of possessory interest, the court observed that (1) the pages were created when a user visited the website using the Search App, (2) the copy existed on the user’s device, and (3) the page was deleted when the user left the page. Because the purported possessory interest was “entirely dependent” on the actions taken by individual users, plaintiffs could not claim ownership of such interest.

And as for the lack of property interest, the court held that the lower court erred in focusing the property-ownership analysis on the website itself, rather than the website copies that appeared on the user’s mobile device. It then applied a three-part test set out in Kremen v. Cohen, 37 F.3d 1024 (9th Cir. 2003) to determine that (1) a website copy is not “capable of precise definition” because there is no single way to display a website copy, (2) a website copy is not “capable of exclusive possession or control” because the user is the one who dispenses with the page in his or her local environment, and (3) there is no “legitimate claim to exclusivity” over website copies, making them different than other types of tangible property recognized as being subject to trespass.

Unjust enrichment claim preempted by federal copyright law

The court used a two-part test to assess whether plaintiffs’ state-law claim for unjust enrichment conflicted with the federal Copyright Act. The first step of the test examined the nature of how plaintiffs’ websites were presented, and led the court to determine that the websites involved the subject matter covered by federal copyright law.

In the second step, the panel compared the rights claimed by plaintiffs under their unjust enrichment claim to see whether they were equivalent to those rights protected by federal copyright law. The court held that it was appropriate to focus on the rights asserted by plaintiffs. It found that the described action of placing ads over the websites resulted in the creation of a derivative work – a right enumerated in the Copyright Act.

Additionally, the court found that plaintiffs’ state-law claim did not include any additional elements that would distinguish it from a typical federal copyright claim. This lack of an “extra element” was a key factor in the panel’s conclusion. As a result, the panel determined that plaintiffs’ state-law claim was indeed preempted by federal copyright law, aligning the state claim with the broader protections offered at the federal level.

What the case means for business

The ruling holds significant implications for digital enterprises, particularly concerning advertisement placement and risk management. This case underscores the legal complexities of embedding advertisements on digital platforms, highlighting the importance of legal compliance and awareness of intellectual property laws. Additionally, it emphasizes the need for diligent risk management in the company’s operations. This case serves as an important reminder of the potential legal risks associated with digital content and advertising practices, making it imperative for companies to maintain a proactive approach to legal compliance and risk mitigation in these areas.

Best Carpet Values, Inc. v. Google, LLC, 2024 WL 119670 (9th Cir., January 11, 2024)

See also:

May 13, 2019 Computer Crime, Contracts

Sony’s EULA did not protect it from liability under CFAA and for trespass to chattel

Plaintiff filed a class action lawsuit against Sony after Sony issued a software update that bricked plaintiff’s Sony Dash. Sony moved to dismiss for failure to state a claim. The court granted the motion on a number of claims but allowed the Computer Fraud and Abuse Act (CFAA) and trespass to chattel claims to move forward.

CFAA Claim

Sony had argued that the CFAA claim should fail because plaintiff had not alleged the software update was “without authorization,” given the language of the end user license agreement, which read:

From time to time, Sony … may automatically update or otherwise modify the Software, for example, but not limited to for purposes of error correction, improvement of features, and enhancement of security features. Such updates or modifications may change or delete the nature of features or other aspects of the Software, including but not limited to features you may rely upon. You hereby agree that such updates and modifications may occur at Sony’s sole discretion, and that Sony may condition continued use of the Software upon your complete installation or acceptance of such updates or modifications.

Specifically, Sony argued that the EULA authorized Sony to “modify” the software at any time, and warned that such modifications may change or delete the nature of features or other aspects of the software, including features the consumer may rely upon. A court addressed a similar argument in In re Apple, 596 F.Supp.2d 1288 (N.D. Cal. 2008). In that case, Apple, as defendant, relied on the following language to argue that it acted “with authorization” for purposes of the CFAA when bricking iPhones that had been unlocked to access third-party applications:

IF YOU HAVE MODIFIED YOUR IPHONE’S SOFTWARE, APPLYING THIS SOFTWARE UPDATE MAY RESULT IN YOUR IPHONE BECOMING PERMANENTLY INOPERABLE

In that case, the court concluded that usage of the term “may” (as in “may result” in damage) created too much ambiguity surrounding Apple’s warning and found plaintiff’s allegations as to its CFAA claim sufficient to defeat Apple’s motion to dismiss.

Here, Sony had used the same ambiguous “may” (as in “may change or delete the nature of features”) and even more uncertain language than in In re Apple. Unlike in In re Apple, Sony did not explicitly warn that a subsequent software update could render the Dash “permanently inoperable.” The EULA did not say that Sony could delete all features. Instead, it vaguely warned consumers that Sony “may change or delete the nature of features” that a consumer “may rely upon.” This sentence was also prefaced by the following: “From time to time, Sony … may automatically update or otherwise modify the Software, for example, but not limited to for purposes of error correction, improvement of features, and enhancement of security features.”

The court found that this preface implied that automatic software updates would improve or enhance the Dash – not destroy its functionality. The court could not say at this stage that by using the Dash and thus implicitly agreeing to the EULA, plaintiff authorized Sony to render his device inoperable. Accordingly, the court found that plaintiff plausibly pled that Sony acted “without authorization” in bricking the Dash.

Tresspass to Chattel

Under New Jersey law, “[a] cognizable claim for trespass to chattel occurs ‘when personal property, in the actual use of the owner, is injured or taken by a trespasser, so that the owner is deprived of the use of it.’” Arcand v. Brother Int’l Corp., 673 F. Supp. 2d 282, 312 (D.N.J. 2009) (quoting Luse v. Jones, 39 N.J.L. 707, 709 (N.J. 1877)). “[P]hysical contact with the chattel, for instance, where a person kicks another’s car bumper, is not required.” Id. “All that is required … is interference with the chattel as a direct or indirect result of an act done by the actor.” Id.

In this case, Sony’s software update bricked plaintiff’s Dash. The court found that contrary to Sony’s assertions, plaintiff had not consented to Sony rendering his device wholly nonfunctional by agreeing to the EULA.

Sony had also argued that plaintiff never owned the software used by the Dash (in accordance with the EULA) and therefore Sony could not be liable for altering that software in the update. But the court saw it otherwise — whether plaintiff owned the software, Sony, at a minimum, indirectly injured plaintiff’s physical Dash by rendering it completely nonfunctional through the software update. The court again looked to In re Apple wherein that court found that the plaintiffs plausibly pled trespass to chattel by alleging that Apple released a software update that rendered the plaintiffs’ iPhones permanently inoperable. On these facts, the court found that plaintiff had plausibly pled his trespass to chattel claim.

Grisafi v. Sony Electronics Inc., 2019 WL 1930756 (D.N.J. April 30, 2019)

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