Litigation
As early as 2003, Attorney Joseph H. Malley, (Law Offices of Joseph H. Malley, PC, Dallas Texas), began investigating the emergence of videos used in online ads to conduct ubiquitous tracking of consumers, developing a litigation plan. The difficulty in developing a strategy concerned little if any legal precedent related to modern technology, and a lack of scientific proof evidencing hidden tracking mechanisms. By 2007, it was determined that sufficient computing device testing had been completed using various software programs, and a new litigation strategy developed to "test" the courthouse. This research culminated in Attorney Malley filing a Federal Class Action against Facebook, and thirty-three companies, including Blockbuster, Zappos, and Overstock, due to privacy violations caused by the Facebook Beacon program. This program resulted in users' private information, obtained from third-party affiliate marketing websites, being posted on Facebook without users' consent. This act was referenced in the Lane v. Facebook, Inc. class action suit. Based on this act, it is generalized to other forms of rental records such as DVDs and video games etc.
With the emergence of new-age computing technology and devices in the early 2000s came websites, 3rd party advertising, and tracking firms using mechanisms that violated a user's privacy. While computer technology was progressing rapidly, federal and state laws had failed to be proactive, a risk to society of ungoverned technology. As such, litigation for violations was relatively non-existent. A new method to litigate Federal privacy cases was needed to protect the hundreds of millions of people violated by unauthorized tracking user's activities online. This was a formidable task since no law firms had litigated cases involving the computer technology inherent within the exchange of user data between third-party affiliated entities; thus there was no case precedent, no "blueprint" to follow. Earlier cases, such as the double-click "cookie" case in 2001, had relied on using a wiretap statute, the Electronic Communication Privacy Act ("ECPA"). While a plausible allegation, it was a weak allegation since the website user had granted such permissible use within the website's term of service ("TOS").
Attorney Malley, who had developed a litigation strategy in the early 2000s involving another federal privacy law, the Driver Privacy Protection Act ("DPPA"), a law related to the unauthorized access to DMV records and permitted statutory damages for privacy violations. IE., $2500.00 damage award "per person-per violation, (per company)", successfully filing numerous federal class actions against 3-400+ companies, sought a similar strategy, but needed to develop a new theory of liability for added assurance to survive a motion to dismiss.
The online advertising industry, in association with analytic companies, had begun using video ads to conduct its ubiquitous tracking, consumer's attention shown to be drawn to such as opposed to written content, In later years, these tracking methods would expand to photos and audio, IE., In 2008, cell phones were re-designed to include a new method of tracking, the use of social apps to collect photos, a process which now permitted a one step "click" process to upload a photo as opposed to the previous six steps, thus consumers were now more inclined to upload photos in mass. This allowed content to be provided for free and which formed the basis for the tracking, i.e. Exif data. Such acts were captured when Attorney Malley used software applications to log HTTP/HTTPS traffic between a computer's web browser and the Internet, analytic tests using two computers interfaced, producing indisputable evidence of such activities: moreover, detailed reports of any and all parties involved in such nefarious activities, IE., "tracking the trackers". In the continuing research of the Industry's business practices in order to determine its monetization interests, such revealed the incorporation of complex graphics within online ads, and the exchange of data derived from video ads not confined to an internal network, used via a TCP/IP protocol. This unauthorized activity would become the core allegation.
Extensive research and case analysis of Federal and State laws, regulations, and Court Opinions yielded limited assistance. An adaptation of the law was needed to litigate this new computer technology involving the unauthorized access to online consumer's data. Attorney Malley seized on an archaic law written concerning the technology of the 1980s involving video cassettes, VHS, and Betamax, the Video Privacy Protection Act ("VPPA"), 18 U.S. Code § 2710 - Wrongful disclosure of video tape rental or sale records, (1988), envisioning that the websites, and any affiliated third-parties, which used the audio and/or video within its marketing ads were "video-providers"; moreover, this content, ads and online games, merely a video; moreover, the essential functionality of the illegal transfer, a "wrongful disclosure", (core elements needed to prove-up a VPPA violation). The use of the VPPA law in regard to this new-age computer technology would set precedent, and become the new "blueprint" used in Federal privacy litigation.
The class that the plaintiffs represented were all Facebook users who visited Beacon affiliate sites, a class of about 3.6 million users.[8] One of the law firms involved was also behind the lawsuits involving digital rights management on the Amazon Kindle, Spore, and the Sony rootkit.[9]
The Beacon affiliated companies were Blockbuster Inc., Fandango.com Inc, Hotwire Inc, STA Travel Inc, Overstock.com Inc, Zappos.com Inc, and GameFly Inc.
