Ninth Circuit Urged To Reconsider Ruling Narrowly Limiting "Public Injunctive Relief" Exception To Arbitration In Privacy And Data Collection Class Actions

• Published date: 29 October 2021
• Subject Matter: Privacy, Data Protection
• Law Firm: Squire Patton Boggs LLP
• Author: Ms Kristin L. Bryan

CPW covered in September how the Ninth Circuit Court of Appeals reversed a district court order denying Comcast Cable Communications, LLC's ("Comcast") motion to compel arbitration under the Federal Arbitration Act ("FAA") claims brought against it by a former cable subscriber. The Plaintiff had brought a putative class action challenging Comcast's privacy and data-collection practices for subscribers and demanded monetary and equitable remedies. Hodges v. Comcast Cable Communs., LLC, 2021 U.S. App. LEXIS 27268 (9th Cir. Sep. 10, 2021).

The case followed off of the California Supreme Court ruling in the McGill case that insofar as a contractual provision "purports to waive [a party's] right to request in any forum . . . public injunctive relief, it is invalid and unenforceable under California law" (the "McGill Rule"). 2 Cal. 5th 945 (Cal. 2017). [Note: Subsequently, in 2019 the Ninth Circuit had previously ruled that "the FAA does not preempt" the McGill Rule. Blair, 928 F.3d 819, 822 (9th Cir. 2019).]

Flash forward to the Ninth Circuit's Comcast ruling in September. The decision was notable in that the Ninth Circuit adopted a narrow reading of the "public injunctive relief" exception to arbitration provisions under California law, with the anticipated result that more privacy class actions would be forced into binding arbitration going forward.

• Specifically, the Ninth Circuit held that public injunctive relief as used in the California Supreme Court's ruling in McGill "is limited to forward-looking injunctions that seek to prevent future violations of law for the benefit of the general public as a whole, as opposed to a particular class of persons, and that do so without the need to consider the individual claims of any non-party." (emphasis supplied).
• By contrast, the Court ruled, "when the injunctive relief being sought is for the benefit of a discrete class of persons, or would require consideration of the private rights and obligations of individual non-parties," it is private injunctive relief outside the narrow scope of McGill.

Well, last week the Plaintiff who had filed suit in Comcast filed a petition for the Ninth Circuit to rehear the case (either en banc or with the same panel previously) and revisit its...