After a string of daily CIPA rulings on motions to dismiss, Prudential, ActiveProspect, and Assurance IQ’s motion for summary judgment (for a certified class) was granted by District Court Judge Charles R. Breyer in the Northern District of California. Valerie Torres, Rhonda Hyman, et al. v. Prudential Financial, Inc., ActiveProspect, Inc., and Assurance IQ, LLC., No. 3:22-cv-07465-CRB (N.D. Cal. April 17, 2025).
The second prong of section 631 imposes liability where a person, “willfully and without the consent of all parties to the communication, or in any unauthorized manner, reads, or attempts to read, or to learn the contents or meaning of any message, report, or communication while the same is in transit.” Cal. Penal Code § 631. Defendants make
two arguments as to why they cannot be liable under section 631. First, Defendants argue that ActiveProspect does not constitute a third-party eavesdropper. Mot. at 12–20. Second, Defendants argue that ActiveProspect did not read or attempt to read Plaintiffs’ communications while the communications were in transit. Id. at 21–24.…
To evaluate whether a software service provider like ActiveProspect constitutes a third-party listener as opposed to a participant in the conversation, courts assess whether the software service “extends beyond the ordinary function of a tape recorder.” Yoon v. Lululemon USA, Inc. 549 F. Supp. 3d 1073, 1081 (C.D. Cal. 2021); see also Javier v. Assurance IQ, LLC, 649 F. Supp. 3d 891, 898 (N.D. Cal. 2023) (“the Court must decide whether ActiveProspect is more akin to the tape recorder in Rogers, held by Assurance, or the friend in Ribas (in which case, Assurance is the wife who allowed ActiveProspect to listen in)”). This requires looking at the software vendor’s independent “capability to use its record of the interaction for [another] purpose.” Cody v. Ring LLC, 718 F. Supp. 3d 993, 1002 (N.D. Cal. 2024) (quoting Javier, 649 F. Supp. 3d at 900).
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Defendant’s arguments are unpersuasive because they demonstrate only that it is ActiveProspect’s policy not to use the TrustedForm data for its own purposes. This is irrelevant to the issue as to whether ActiveProspect is capable of using superuser access for its own ends. The fact remains that, if ActiveProspect can grant a limited subset of
employees access to TrustedForm accounts (and, thus, the underlying TrustedForm data), then ActiveProspect can potentially use TrustedForm data for its own ends, even if it is not their policy to do so.
Defendant’s fared better on the question of “in transit.”
Even if TrustedForm software intercepts the contents of Plaintiffs’ communications in real time and stores the recording on an ActiveProspect server that ActiveProspect employees
can access, nothing in the record plausibly indicates that ActiveProspect reads or attempts to read the contents of the communication while they are in transit. See Valenzuela v.
Keurig Green Mountain, Inc., 674 F. Supp. 3d 751, 758 (N.D. Cal. 2023) (“‘While’ is the key word here.”).
There was no evidence that ActiveProspect attempted to “analyze, summarize, or otherwise interpret Plaintiffs’ data….”
The act of reassembling events like keystrokes, mouse movements, and clicks into a session replay (for the convenience of a party to the
communication itself) is not analogous to creating personal profiles that can then be marketed to third-party advertisers. And it does not constitute reading under the statute….
Plaintiffs did not show that Defendants deciphered and read the contents of communication, while in transit. As a result, the motion for summary judgment was granted and judgment was entered for the defense.
