9th Circuit Sides With Verizon Customers' in Case Against Ad Company for Using 'Zombie Cookies'

Two Verizon cellular customers who filed a proposed putative class-action lawsuit against Turn for allegedly using "zombie cookies" to collect their personal data to deliver ads won a petition to have their case reheard when the 9th U.S. Circuit Court of Appeals overturned a lower-court ruling that tossed out the suit and compelled arbitration with the company. "We are pleased with the Ninth Circuit's decision and are looking forward to litigating these claims," said Lieff Cabraser partner Nimish Desai, who represent plaintiffs William Cintron and Anthony Henson. Ninth Circuit Judges William Fletcher and Richard Tallman and District of Arizona Judge Roslyn Silver issued the per curiam opinion (in Pacer) Tuesday that said the District Court for the Northern District of California "committed clear error by applying New York’s equitable estoppel doctrine, rather than California’s, and by failing to apply California law correctly." It was one of three of five factors from the 1977 case, Bauman v. U.S. District Court, that the panel said weighed in favor of granting the petition. According to the opinion, Verizon granted Turn, described as a "middle man," a license to target ads to subscribers in exchange for a cut of the revenue. Turn attached tracking cookies to Verizon subscribers' "Unique Identifier Headers" to collect data to its servers, but the carrier's customers "were allegedly unable to detect, delete, or block these 'zombie' cookies attached to the UIDHs," said the opinion. Plaintiffs filed the class action on behalf of Verizon subscribers in New York, saying Turn engaged in deceptive practices and interfered with "the use and enjoyment" of their devices, said the opinion. Turn sought to dismiss claims and force arbitration in the customer agreement between customers and Verizon for any disputes, but the panel said Turn isn't a signatory to the agreement and the district court didn't do a "choice-of-law analysis" when it granted Turn's motion to compel arbitration. Neither digital marketing company Amobee, which said in April it's acquiring Turn, nor Turn's attorneys commented. Verizon declined to comment.