Skip to main content
Menu Icon
Close

InfoBytes Blog

Financial Services Law Insights and Observations

District Court denies company’s bid to arbitrate in class action

Courts Arbitration Class Action Privacy/Cyber Risk & Data Security State Issues California

Courts

On September 15, the U.S. District Court for the Southern District of California denied a defendant tech company’s motion to compel arbitration, dismiss or stay a class action lawsuit alleging that it violated the California Invasion of Privacy Act, among other things, by monitoring certain contract employees’ social media activity. The complaint alleges that the named plaintiff, a contract delivery driver for the company, and other contract employees, utilized an online platform to “discuss ‘a myriad of issues surrounding their employment,’ including strikes, protests, pay, benefits, deliveries, working conditions, and unionizing efforts.” The plaintiff alleged that the company was secretly monitoring and wiretapping the employees’ social media groups and created a team “to ‘monitor and/or intercept[]’ posts to closed [online] groups ‘in real time . . . using automated monitoring tools,’” without obtaining consent.   

With respect to the defendants’ motion to compel arbitration, the company argued that, under the applicable terms of service, the plaintiff was required to arbitrate his claims on an individual basis. The court, however, found that that the plaintiff met his burden to demonstrate that the claims alleged do not fall within the scope of the arbitration provision.