A three-judge panel of the U.S. Court of Appeals for the Eighth Circuit in Carlsen v. GameStop Inc. said the plaintiff failed to clear a necessary hurdle in the class action.
Matthew Carlsen filed the action against GameStop and Sunrise Publications Inc. for breach of contract, unjust enrichment, money had and received, and violation of Minnesota’s Consumer Fraud Act, or CFA.
Carlsen, who subscribed to GameStop’s Game Informer Magazine -- which offers news, reviews and commentary about the video-game industry -- accused the company of disclosing his Facebook ID and browsing information for GameStop’s online content to the social network.
GameStop filed a motion to dismiss Carlsen’s complaint. The U.S. District Court for the District of Minnesota in Minneapolis granted the motion, finding Carlsen lacked standing.
Eighth Circuit judges Raymond Gruender and Diane Murphy, along with senior judge C. Arlen Beam, affirmed the district court’s ruling on the basis that Carlsen’s complaint failed to state a claim upon which relief can be granted.
Carlsen alleged GameStop shared his personal information through the Game Informer website, which includes features that allow Game Informer users to log in to the website using their Facebook accounts and to use Facebook’s “like,” “share” and “comment” functions through the Game Informer website.
Game Informer provides these features by adding a Facebook Software Development Kit, or SDK, to the source code on the Game Informer website.
Carlsen alleged this SDK transmitted a user’s unique Facebook ID and Game Informer browsing history to Facebook if the user previously had opted to stay logged in to Facebook.
Carlsen said had he known about the disclosures, he either would not have paid for the subscription or would have refrained from accessing the online content for which he paid.
The district court, in its ruling, said the case was comparable to identity theft and data breach class actions and found that that Carlsen lacked standing for failure to allege an injury in fact with respect to his overpayment and would-not-have-shopped theories.
The Eighth Circuit, in its Aug. 16 opinion, concluded Carlsen did, in fact, have standing to bring his breach-of-contract and other claims.
“Additionally, Carlsen alleged that he has suffered damages as a result of GameStop’s breach in the form of devaluation of his Game Informer subscription in an amount equal to the difference between the value of the subscription that he paid for and the value of the subscription that he received, i.e., a subscription with compromised privacy protection. Accordingly, Carlsen has alleged an ‘actual’ injury.”
However, the facts as alleged fail as a matter of law to establish GameStop’s breach, the appeals court ruled.
And while “may include” appears to create a non-exclusive list, the court points out that the definition of personal information is included and better explained in a section entitled, “What Information Does Game Informer Collect.”
“The protection Carlsen argues GameStop failed to provide was not among the protections for which he bargained by agreeing to the terms of service, and GameStop thus could not have breached its contract with Carlsen.”
His Minnesota CFA claim fails for similar reasons, the appeals court ruled.
Beam concurred with affirming the district court’s dismissal of Carlsen’s claims, but disagreed with his fellow Eighth Circuit judges on their reasoning.
He argues Carlsen has failed to assert the “necessary justiciable controversy” required, citing the U.S. Supreme Court’s recent ruling in Spokeo v. Robins.
The nation’s high court explained in its May decision that for an injury to be particularized, it must affect the plaintiff in a “personal and individual way.” The injury-in-fact also must be “concrete,” which means “real” and “not abstract.” But “concrete” is not necessarily synonymous with “tangible.”
“At best, Carlsen’s pleadings consist of a panoply of imprecise contractual emanations purporting to illustrate possible economic harm,” Beam wrote. “This is not enough.”
From Legal Newsline: Reach Jessica Karmasek by email at email@example.com.