Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-12-17391/USCOURTS-ca9-12-17391-0/pdf.json

Parties Involved:
Daniel Rodriguez
Appellant
Sony Computer Entertainment America, LLC
Appellee
Sony Network Entertainment International, LLC
Appellee

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DANIEL RODRIGUEZ, individually

and on behalf of all others similarly

situated,

Plaintiff-Appellant,

v.

SONY COMPUTER ENTERTAINMENT

AMERICA, LLC, a Delaware limited

liability company; SONY NETWORK

ENTERTAINMENT INTERNATIONAL,

LLC, a Delaware limited liability

company,

Defendants-Appellees.

No. 12-17391

D.C. No.

4:11-cv-04084-

PJH

OPINION

Appeal from the United States District Court

for the Northern District of California

Phyllis J. Hamilton, Chief District Judge, Presiding

Argued and Submitted

February 6, 2015—San Francisco, California

Filed September 4, 2015

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2 RODRIGUEZ V. SONY COMPUT. ENTM’T AM.

Before: Richard C. Tallman and Johnnie B. Rawlinson,

Circuit Judges, and Raymond J. Dearie, Senior District

Judge.*

Opinion by Judge Rawlinson

SUMMARY**

Video Privacy Protection Act

The panel affirmed the district court’s dismissal of an

action under the Video Privacy Protection Act.

The plaintiff alleged that two Sony corporations violated

the Act by retaining his personally identifiable information

beyond the Act’s statutory limits and by disclosing his

personal information between Sony entities. Agreeing with

the Sixth and Seventh Circuits, the panel held that the Act

does not provide a private right of action to enforce its

retention requirements for video service providers. The panel

held that the alleged inter-corporate disclosures were exempt

from the Act’s non-disclosure requirements.

* The Honorable Raymond J. Dearie, Senior District Judge for the U.S.

District Court for the Eastern District of New York, sitting by designation.

** This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 3

COUNSEL

Roger Perlstadt (argued), Edelson PC, Chicago, Illinois; Sean

Reis, The Reis Law Firm, A.P.C., Rancho Santa Margarita,

California, for Plaintiff-Appellant.

Michael G. Rhodes (argued) and Ray A. Sardo, Cooley LLP,

San Francisco, California; Lori R. Mason, Cooley LLP, Palo

Alto, California; Michelle Doolin, Cooley LLP, San Diego,

California, for Defendants-Appellees.

OPINION

RAWLINSON, Circuit Judge:

Appellant Daniel Rodriguez (Rodriguez) challenges the

district court’s dismissal of his second amended complaint

alleging that Appellees Sony Computer Entertainment

America LLC (Sony Computer) and Sony Network

Entertainment (Sony Network) International LLC

(collectivelySony) violated the Video PrivacyProtection Act

(the Act) by retaining Rodriguez’s personally identifiable

information (personal information) beyond the Act’s statutory

limits, and disclosing his personal information between Sony

entities. Rodriguez contends that the district court erred in

concluding that the Act does not provide a private right of

action to enforce its retention requirements. Rodriguez also

takes issue with the district court’s conclusion that the intracorporate disclosures were exempt from the Act’s nondisclosure requirements. We affirm the district court’s

rulings.

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4 RODRIGUEZ V. SONY COMPUT. ENTM’T AM.

I. BACKGROUND

A. Statutory Background

The Act was promulgated in 1988 after the Washington

City Paper published Judge Robert Bork’s video rental

history during his failed Supreme Court confirmation

proceedings. See Mollett v. Netflix, Inc., No. 12-17045, –

F.3d –, 2015 WL 4591798, at *3 (9th Cir. July 31, 2015).

The Act restricts a video service provider’s retention and

disclosure of a consumer’s personal information. See

18 U.S.C. § 2710(b). A video service provider “means any

person, engaged in the business, in or affecting interstate or

foreign commerce, of rental, sale, or delivery of prerecorded

video cassette tapes or similar audio visual materials, or any

person or other entity to whom a disclosure is made . . .” Id.

at § 2710(b)(1). Under the Act, a consumer is “any renter,

purchaser, or subscriber of goods or services from a video

tape service provider[.]” Id. at § 2710(a)(1). The Act defines

“personally identifiable information” as including

“information which identifies a person as having requested or

obtained specific video materials or services from a video

tape service provider[.]” Id. at § 2710(a)(3). With respect to

the retention of a consumer’s personal information, the Act

mandates that:

A person subject to this section shall destroy

personally identifiable information as soon as

practicable, but no later than one year from

the date the information is no longer

necessary for the purpose for which it was

collected and there are no pending requests or

orders for access to such information under

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 5

subsection (b)(2) or (c)(2) or pursuant to a

court order.

Id. at § 2710(e).

The Act also imposes liability for unlawful disclosure of

a consumer’s personal information:

(1) A video tape service provider who

knowingly discloses, to any person,

personallyidentifiable information concerning

any consumer of such provider shall be liable

to the aggrieved person for the relief provided

in subsection (d).1

1 The Act limits any relief to that provided in 18 U.S.C. § 2710(d). See

18 U.S.C. § 2710(b). In turn, 18 U.S.C. § 2710(d) provides:

Personally identifiable information obtained in any

manner other than as provided in this section shall not

be received in evidence in any trial, hearing, arbitration,

or other proceeding in or before any court, grand jury,

department, officer, agency,regulatory body, legislative

committee, or other authority of the United States, a

State, or a political subdivision of a State.

As the Seventh Circuit observed, it appears that § 2710(b) mistakenly

references § 2710(d) as a remedies provision. See Sterk v. Redbox

Automated Retail, LLC, 672 F.3d 535, 537 (7th Cir. 2012) (Sterk I)

(observing that “[t]he statute says (d), but this must be an error, not only

because the only ‘relief’ provided there is exclusion of the personally

identifiable information fromevidence, but also because it is very unlikely

that a video tape service provider would ever be submitting, as evidence

in a legal proceeding, personally identifiable information that the provider

had disclosed”).

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Id. at § 2710(b). The Act also provides that “[a]ny person

aggrieved by any act of a person in violation of this section

may bring a civil action in a United States district court.” 

18 U.S.C. § 2710(c).

Relevant to the present appeal, video service providers are

exempt from liability for disclosure “if the disclosure is

incident to the ordinary course of business of the video tape

service provider[.]” 18 U.S.C. § 2710(b)(2)(E). The Act

defines “ordinary course of business” as “debt collection

activities, order fulfillment, request processing, and the

transfer of ownership[.]” Id. at § 2710(a)(2).

B. Rodriguez’s Claims Under the Act

There have been several permutations of Rodriguez’s

claims against various Sony entities premised on the

provisions of the Act. In his original class action complaint,

Rodriguez alleged that Sony Computer, as a video service

provider, violated the Act by maintaining and storing its

customers’ personal information rather than destroying the

information no later than one year after it was collected. 

Rodriguez averred that, in 2008, he was a registered user of

Sony’s PlayStation Network, which provides online gaming

and video services streamed to a customer’s television. 

Rodriguez rented and purchased several video games and

movies through the PlayStation Network in 2009, but did not

purchase or rent any movies after Sony modified its

streaming system in April, 2010. According to Rodriguez,

Sony continued to store his personal information relating to

the movies that he had rented and purchased in violation of

the Act’s time limits for the storage of such information. 

Based on these allegations, Rodriguez sought statutory and

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 7

punitive damages, as well as injunctive relief and attorneys’

fees.

Sony sought dismissal of Rodriguez’s complaint on the

basis that Rodriguez lacked standing to pursue his claims

under the Act, and failed to properly allege any injury-in-fact. 

Sony also maintained that Rodriguez consented to Sony’s

retention of his information pursuant to Sony’s terms of

service and privacy policy.

In response, Rodriguez filed a first amended class action

complaint adding Sony Network as a defendant, and ten John

Doe defendants. Rodriguez asserted that, subsequent to his

registration as a PlayStation Network customer, Sony

Network assumed control over the PlayStation Network and

its related services. Rodriguez alleged that Sony Computer

and Sony Network violated the Act when they impermissibly

shared Rodriguez’s personal information with each other

during the change in Sony’s operations.

Rodriguez also alleged that SonyNetwork’s utilization of

his personal information for “marketing purposes and

demographic studies” demonstrated that his personal

information had monetary value and that he never entered

into an agreement permitting use of his personal information

for these purposes. Rodriguez sought damages and injunctive

relief.

Sony filed a motion to dismiss Rodriguez’s first amended

complaint, which the district court granted. The district court

dismissed with prejudice Rodriguez’s claim premised on

retention of his personal information because the Act does not

provide a private right of action for retention of information. 

The district court also dismissed with prejudice Rodriguez’s

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8 RODRIGUEZ V. SONY COMPUT. ENTM’T AM.

unlawful disclosure claim because the Act permits disclosure

of personal information between related corporate entities

during the ordinary course of business. The district court

held that the disclosures by Sony Computer and Sony

Network were permitted because the disclosures occurred

during the transfer of operations. The district court also

concluded that Rodriguez failed to allege any unlawful

disclosures to the Doe defendants. The district court

dismissed Rodriguez’s unlawful disclosure claim with

prejudice as it related to Sony Computer and Sony Network,

but granted leave to amend regarding the Doe defendants.

Despite the limitations imposed by the district court’s

dismissal order, Rodriguez filed a second amended class

action complaint with significantly revamped claims. 

Rodriguez alleged that, between 2009 and 2011, he rented

movies from SonyComputer, but had not rented or purchased

any movies since August 28, 2011. Rodriguez averred that,

although Sony Network assumed management over the

PlayStation Network in 2011, “the change in management did

not involve any transfer of ownership . . .” According to

Rodriguez, Sony Computer’s disclosure of his personal

information occurred prior to the change in management.

Rodriguez’s original claim based on violations of the Act

was restated as three claims premised on unlawful retention,

unlawful disclosure, and a newly minted breach of contract

claim. In support of his claim for unlawful retention,

Rodriguez alleged that Sony Computer and Sony Network

retained his personal information for an indefinite period of

time in violation of the Act and lacked policies for the timely

destruction of this information. Rodriguez asserted that he

was injured because the unlawful retention was a violation of

his privacy rights and he suffered economic damages

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 9

stemming from Sony’s unauthorized use of his personal

information. According to the Complaint, Rodriguez

incurred monetary damages because a portion of the purchase

price for each movie or video game “was intended to pay for

[Sony Computer’s] costs in timely destroying [customers’

personal information]. . . .” Rodriguez alleged that he

overpaid for his movie purchases because the purchase or

rental prices included costs associated with compliance with

the Act. Rodriguez also asserted that he was entitled to relief

pursuant to the Stored Communications Act for Sony’s

willful and intentional violations.

For his unlawful disclosure claim, Rodriguez alleged that

Sony Computer disclosed without consent Rodriguez’s

personal information to Sony Network prior to the transfer of

management in September, 2011. Rodriguez stated that these

disclosures deprived him of control over his personal

information and his ability to market that information for his

own financial gain.

In support of his breach of contract claim, Rodriguez

asserted that he entered into a binding contract with Sony

Computer for the purchase and rental of video games and

movies. According to Rodriguez, Sony Computer and Sony

Network breached this contract that incorporated the Act’s

retention requirements, resulting in actual damages.

The district court again granted Sony’s motion to dismiss. 

The district court observed that, despite the prior dismissal of

Rodriguez’s unlawful retention claim with prejudice,

Rodriguez’s claim “has resurfaced in a variety of different

packages. . . .” The district court determined that Rodriguez

could not reshape his dismissed unlawful retention claim as

a breach of contract claim because he failed to identify any

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agreement memorializing the Act’s requirements as

contractual obligations. The district court also held that

dismissal of Rodriguez’s unlawful disclosure claim was

warranted because leave to amend was granted only as to any

unlawful disclosures made to the Doe defendants.

Rodriguez filed a timely notice of appeal.

II. STANDARDS OF REVIEW

“We review de novo the district court’s dismissal of

[Rodriguez’s] Amended Complaint under Federal Rule of

Civil Procedure 12(b)(6) and accept all factual allegations in

the Amended Complaint as true.” Or. Pub. Emps. Ret. Fund

v. Apollo Grp. Inc., 774 F.3d 598, 603 (9th Cir. 2014)

(citation omitted).

“We review the interpretation of a statute de novo. . . .” 

United States v. JDT, 762 F.3d 984, 1000 (9th Cir. 2014)

(citation omitted).

III. DISCUSSION

A. Private Right of Action For Unlawful Retention of

Personal Information

Rodriguez maintains that the plain language of 18 U.S.C.

§ 2710(c)(1) provides a private right of action because it

permits a civil action for “violation of this section.”

Although we have not previously addressed this issue, the

Seventh Circuit has rejected the same argument. In Sterk I,

the Seventh Circuit considered whether the plaintiff could

pursue an unlawful retention claim stemming from Redbox’s

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 11

retention of personal information related to its rental services. 

See Sterk I, 672 F.3d at 536. The Seventh Circuit observed

that, because § 2710 was “not well drafted,” application of its

statutory language posed several challenges. Id. at 538. The

Seventh Circuit emphasized that “[t]he biggest interpretive

problem” stems from failure to specify the scope of relief

afforded in § 2710(c). Id. The Seventh Circuit resolved the

interpretive problem by reasoning that § 2710(c) created a

private right of action only for unlawful disclosure of

personal information and not for unlawful retention beyond

the destruction provisions in the Act. See id. The Seventh

Circuit observed that:

If (c) appeared after all the prohibitions,

which is to say after (d) and (e) as well as (b),

the natural inference would be that any

violator of any of the prohibitions could be

sued for damages. But instead (c) appears

after just the first prohibition, the one in

subsection (b), prohibiting disclosure. . . .

Id. The Seventh Circuit acknowledged that the language

placement could have been an accident of legislative drafting,

but agreed with the Sixth Circuit that “the more plausible

interpretation is that it is limited to enforcing the prohibition

of disclosure. . . .” Id. (citing Daniel v. Cantrell, 375 F.3d

377, 384–85 (6th Cir. 2004)).

The Seventh Circuit further observed that awarding

damages or other forms of relief would be illogical for

unlawful retention because no injury would occur absent

disclosure. As the Seventh Circuit articulated:

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How could there be injury, unless the

information, not having been destroyed, were

disclosed? If, though not timely destroyed, it

remained secreted in the video service

provider’s files until it was destroyed, there

would be no injury. True, subsection

(c)(2)(A) allows $2,500 in liquidated

damages, without need to prove actual

damages, but liquidated damages are intended

to be an estimate of actual damages, and if

failure of timely destruction results in no

injury at all because there is never any

disclosure, the onlypossible estimate of actual

damages for violating subsection (e) would be

zero. . . .

Id. (internal quotation marks omitted).

Although Rodriguez contends that the Seventh Circuit’s

opinion was wrongly decided, the Seventh Circuit’s approach

to statutory interpretation was sound. The Seventh Circuit

astutely noted the limited guidance provided by the statutory

language. See id. The unlawful disclosure provision

provides that “[a] video tape service provider who knowingly

discloses, to any person, personally identifiable information

concerning any consumer of such provider shall be liable to

the aggrieved person for the relief provided in subsection

(d).” 18 U.S.C. § 2710(b). As discussed, § 2710(d) is a dead

end for any damages remedy, as it merely precludes the

introduction of personal information as evidence “in any trial,

hearing, arbitration, or other proceeding” and does not

otherwise provide for relief. 18 U.S.C. § 2710(d).

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There are other notable distinctions between the unlawful

disclosure and unlawful retention provisions. The unlawful

disclosure provision explicitly provides for liability “to the

aggrieved person.” 18 U.S.C. § 2710(c). However, the

unlawful retention provision does not specify that a video

service provider is liable for the knowing retention of

personal information. That provision lacks any mens reas

articulation and does not specify any form of available relief

to an aggrieved party. See 18 U.S.C. § 2710(e). Instead, the

provision simply delineates a statutory duty for the

“[d]estruction of old records” by the video service provider,

and does not otherwise provide for civil liability. Id.2

Generally, when the language of the statute is directed

toward the entity being regulated, rather than the party

seeking relief, we have not recognized a private right of

action. See Logan v. U.S. Bank Nat’l Ass’n, 722 F.3d 1163,

1171 (9th Cir. 2013) (articulating that “[s]tatutes containing

general proscriptions of activities or focusing on the regulated

party rather than the class of beneficiaries whose welfare

Congress intended to further do not indicate an intent to

provide for private rights of action”) (citations, alteration, and

internal quotation marks omitted). Faced with this drafting

conundrum, the Seventh Circuit understandably considered

the statute’s structure in resolving the private right of action

issue.

2 The Seventh Circuit’s decision in Graczyk v. West Pub. Co., 660 F.3d

275 (7th Cir. 2011), relied on by Rodriguez, does not compel a contrary

conclusion. In Graczyk, the Seventh Circuit determined that the plaintiff

possessed standing to pursue a civil action for unlawful disclosures in

violation of the Driver’s Privacy Protection Act, and that the statute

created a federal right of action. See Graczyk, 660 F.3d at 278. No

retention claim was at issue.

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Courts “must interpret the statute as a whole, giving effect

to each word and making every effort not to interpret a

provision in a manner that renders other provisions of the

same statute inconsistent, meaningless or superfluous.” 

United States v. Neal, 776 F.3d 645, 652 (9th Cir. 2015)

(citation, alterations, and internal quotation marks omitted). 

“Additionally, particular phrases must be construed in light

of the overall purpose and structure of the whole statutory

scheme.” Id. (citation, alteration, and internal quotation

marks omitted). Rather than focusing on the phrase “in this

section,” as urged by Rodriguez to support creating a right of

action for all subsections, the Seventh Circuit employed

accepted principles of statutory construction to interpret an

imperfectly drafted statute.

The Seventh Circuit’s decision is consistent with the

rationale utilized by the Sixth Circuit, the only other court to

have addressed the Act’s reach. In Daniel, the plaintiff sued

video store owners for disclosing personal information related

to his video rentals. See 375 F.3d at 379–80. Affirming

summary judgment in favor of the defendants, see id. at 379,

the Sixth Circuit concluded that only the unlawful disclosure

provision “includes language related to liability. Neither

section (d) nor section (e) contains such language.” Id. at 384

(citation omitted). The Sixth Circuit explained that:

the structure of the statute makes it clear that

a civil action may be brought based on only a

violation of section (b). Immediately after

section (b), section (c) discusses the rules for

bringing a civil action. After section (c),

sections (d) and (e) discuss receiving personal

information into evidence and destruction of

old records. If these later sections were to be

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 15

a basis for liability, it would make sense that

the section on civil actions would come at the

end of the statute, rather than preceding these

sections.

Id. (footnote reference and internal quotation marks omitted).

Finally, the Act’s legislative history does not evince any

Congressional intent to create a private right of action for a

video service provider’s retention of a consumer’s personal

information beyond the statutorily proscribed time

limitations. When the Act was passed in 1988, its purpose

was “[t]o preserve personal privacy with respect to the rental,

purchase or delivery of video tapes or similar audio visual

materials.” S. Rep. No. 100-599, at 1 (1988), reprinted in

1988 U.S.C.C.A.N. 4342-1.3It appears that Congress

intended to fulfill its expressed purpose by providing a civil

remedy for the unlawful disclosure of personal information,

but not for unlawful retention of that information. The Senate

Report confirms that the Act “prohibits video stores from

disclosing personally identifiable information – information

that links the customer or patron to particular materials or

services. In the event of an unauthorized disclosure, an

individual may bring a civil action for damages.” Id. at 7

(emphasis added). The Senate Report explains that “[t]he

civil remedies section puts teeth into the legislation, ensuring

that the law will be enforced by individuals who suffer as the

result of unauthorized disclosures. . . .” Id. at 8 (emphasis

added). Additionally, in summarizing the subsections, the

Senate Report reiterates that “Section 2710(c) imposes

liability where an individual, in violation of the Act,

3 No House Report was submitted in support of the Act. See S. Rep. No.

100-599, at 1 (1988).

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knowingly discloses personally identifiable information

concerning any consumer. . . .” Id. at 14 (emphasis added).

No similar language of liability appears in the discussion

of the retention subsection. With no mention of civil liability,

the Report explains that “the purpose of [the retention]

provision is to reduce the chances that an individual’s privacy

will be invaded, by requiring the destruction of information

in an expeditious fashion, appropriate to the circumstances

and to the policies protected by this Act.” Id. at 15. This

legislative history persuades us that Congress did not intend

to impose civil liability for violations of the retention

provision.

Further indication of Congressional intent may be

garnered from the 2013 amendment to 18 U.S.C. § 2710,

subsequent to the decisions of the Sixth and Seventh Circuits

denying a private right of action for violation of the retention

provisions of the Act. The amendment clarified that written

consent of the consumer for disclosures may be obtained via

the internet on an ongoing basis. See H.R. Rep. No. 112-312,

at 1 (2011); see also 18 U.S.C. § 2710(b)(2)(B) (2013). 

Notably, Congress did not amend § 2710 to provide for a

private right of action for retention of a consumer’s personal

information in light of the Sixth and Seventh Circuit’s

decisions. See 18 U.S.C. § 2710(c) & (e) (2013).

“Under the rules of statutory construction, we presume

that Congress acts with awareness of relevant judicial

decisions.” United States v. Alvarez-Hernandez, 478 F.3d

1060, 1065 (9th Cir. 2007) (citations and internal quotation

marks omitted). “We also presume that when Congress

amends a statute, it is knowledgeable about judicial decisions

interpreting the prior legislation, and when judicial

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interpretations have settled the meaning of an existing

statutory provision, repetition of the same language in a new

statute indicates, as a general matter, the intent to incorporate

its judicial interpretations as well.” Id. (citations and internal

quotation marks omitted). Congress’ failure to amend

18 U.S.C. § 2710 provides further support for our conclusion

of Congressional intent to limit any private right of action to

claims involving unlawful disclosure. See id.4

Rodriguez asserts that, even if Sterk I was properly

decided, the district court misapplied Sterk I as precluding

any form of relief because the Seventh Circuit’s opinion was

limited to an award of damages. However, the Seventh

Circuit specifically held:

It is true that subsection (c) authorizes other

relief besides just damages, relief less

obviously inappropriate to a violation of (d). 

That is particularly true of equitable relief,

authorized in subsection (c)(2)(D). But when

all that a plaintiff seeks is to enjoin an

unlawful act, there is no need for express

4 Rodriguez relies on Cent. Bank of Denver, N.A. v. First Interstate Bank

of Denver, N.A., 511 U.S. 164 (1994), for the proposition that we may not

consider Congress’ failure to amend 18 U.S.C. § 2710 as Congressional

endorsement of the decisions of the Sixth and Seventh Circuits. In Cent.

Bank of Denver, a case involving the interpretation of § 10(b) of the

Securities Exchange Act of 1934, the Supreme Court observed that

“[w]hen Congress reenacts statutory language that has been given a

consistent judicial construction, we often adhere to that construction in

interpreting the reenacted statutory language.” 511 U.S. at 166, 185

(citations omitted). However, the Supreme Court did not apply that rule

of statutory construction because “Congress has not reenacted the

language of § 10(b) since 1934 . . .” Id. at 185 (citation omitted).

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statutory authorization; absent the clearest

command to the contrary from Congress,

federal courts retain their equitable power to

issue injunctions in suits over which they have

jurisdiction.

Sterk I, 672 F.3d at 539 (citations and internal quotation

marks omitted). As the Seventh Circuit observed, the Act’s

mere mention of equitable relief in a provision that is

inapplicable to retention of a consumer’s personal

information does not support Rodriguez’s assertion of a

private right of action. See id. In other words, the equitable

relief provided in subsection (c)(2)(D) does not provide an

independent basis for a private right of action because it

merely delineates relief that is traditionally within the court’s

inherent authority. See Owner-Operator Indep. Drivers

Ass’n, Inc. v. Swift Transp. Co., Inc.(AZ), 632 F.3d 1111,

1121 (9th Cir. 2011) (articulating that “unless otherwise

provided by statute, the court retains its full equitable

powers”) (citations and internal quotation marks omitted). 

Thus, Rodriguez’s action for injunctive relief fares no better

under Sterk I.

After carefullyexamining the legislative history, structure

and language of 18 U.S.C. § 2710 as a whole, we agree with

the Sixth and Seventh Circuits, and conclude that the district

court properly dismissed Rodriguez’s unlawful retention

claim for lack of a private right of action.

B. Rodriguez’s Unlawful Disclosure Claim

Rodriguez contends that the district court erred in

dismissing his unlawful disclosure claim pursuant to the

ordinary course of business exception provided in 18 U.S.C.

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§ 2710. Rodriguez specifically asserts that he sufficiently

alleged an unlawful disclosure claim premised on disclosure

of his personal information between distinct corporate entities

to which the exception was inapplicable, and that Sony’s

transfer of ownership between Sony Computer and Sony

Network was a factual issue not resolvable at the motion to

dismiss stage.5

The district court properly dismissed Rodriguez’s

unlawful disclosure claim pursuant to the Act’s exemption for

disclosures made “incident to the ordinary course of business

of the video tape service provider[.]” 18 U.S.C.

§ 2710(b)(2)(E). The Act defines “ordinary course of

business” as meaning “debt collection activities, order

fulfillment, request processing, and the transfer of

ownership.” 18 U.S.C. § 2710(a)(2). In the First Amended

Complaint that was subject to the district court’s first order of

dismissal, Rodriguez expressly alleged that Sony Computer

“shared, sold, and/or transferred” his personal information to

Sony Network after Sony Network “took over the

[Playstation Network].” The plain language of the Act

5 Sony challenges Rodriguez’s standing to pursue an unlawful disclosure

claim because he failed to allege an injury-in-fact. The Seventh Circuit

has rejected a similar challenge to a plaintiff’s standing under the Act. See

Sterk v. Redbox Automated Retail, LLC, 770 F.3d 618, 623 (7thCir. 2014)

(Sterk II). The Seventh Circuit observed that “Redbox appears to confuse

the separate issue of whether plaintiffs have suffered financial harm as a

result of the disclosure with Article III’s injury-in-fact requirement for

purposes of constitutional standing to bring suit in the first place.” Id.

(footnote reference omitted). “By alleging that Redbox disclosed their

personal information in violation of the [Act, the plaintiffs] have met their

burden of demonstrating that they suffered an injury in fact that success

in this suit would redress.” Id. We reach a similar conclusion as to

Rodriguez’s standing. See id.

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20 RODRIGUEZ V. SONY COMPUT. ENTM’T AM.

exempts the transfer of ownership alleged in the First

Amended Complaint. See id.

Rodriguez’s subsequent attempt to thwart the statutory

language by artfully pleading that Sony Network assumed the

management of the PlayStation Network as opposed to

assuming ownership is unconvincing, especially considering

that the more recent pleading completely contradicts the

earlier pleading. See Saldana v. Occidental Petroleum Corp.,

774 F.3d 544, 551 (9th Cir. 2014) (“We . . . need not accept

as true legal conclusions contained in the complaint.”)

(citation omitted); see also United States v. Corinthiam

Colls., 655 F.3d 984, 995 (9th Cir. 2011) (explaining that an

amended complaint should aver “additional allegations that

are consistent with the challenged pleading and that do not

contradict the allegations in the original complaint”) (citation

and internal quotation marks omitted).6

We also agree with the Seventh Circuit that intracorporate disclosures are not unauthorized disclosures under

the Act. In Sterk II, Redbox provided Stream Global Services

a database containing the personal information of Redbox

customers to enable Stream Global to service customers on

behalf of Redbox. See 770 F.3d at 620–21. The Seventh

Circuit concluded that Redbox’s “wholesale disclosure of

information pertaining to all customers” did not contravene

the Act because the disclosures were intended to support

Redbox’s services. Id. at 627. As the Seventh Circuit

cogently observed, the Senate Report reflects Congress’

6 We do not agree with Rodriguez that the determination of whether the

exemption applies is a factual determination. See Miranda v. Anchondo,

684 F.3d 844, 849 (9th Cir. 2012), as amended (“The construction or

interpretation of a statute is a question of law . . .”) (citation omitted).

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RODRIGUEZ V. SONY COMPUT. ENTM’T AM. 21

awareness of the unremarkable fact that no business is an

island and that video tape services providers, like many other

businesses, “may use third parties in their business

operations. . . .” Id. at 624 (quoting Senate Report No. 100-

599 at 14). The functions performed by these third parties

fall within the definition of “order fulfillment” or “request

processing.” Id. (quoting S. Rep. No. 100-599 at 14). Thus,

even if the district court accepted the contradictory

allegations of the Second Amended Complaint as true, the

outcome for Rodriguez would not change. The reason is

simple – if Sony Network assumed management of the

Playstation Network on behalf of Sony Computer, that

service would fall comfortably within the “order fulfillment”

or “request processing” exemptions set forth in § 2710(a)(2),

(b)(2)(E). Either way, Rodriguez loses.

IV. CONCLUSION

The district court properly dismissed Rodriguez’s

unlawful retention claim. We join the Sixth and Seventh

Circuits in holding that the Act does not provide a private

right of action for the retention of a consumer’s personal

information beyond the time limitations established in

18 U.S.C. § 2710(e). The Act’s legislative history and the

language and structure of 18 U.S.C. § 2710 reflect that

Congress limited any civil remedies to the unlawful

disclosure of a consumer’s personal information.

The district court also properly dismissed Rodriguez’s

unlawful disclosure claim. Rodriguez failed to sufficiently

allege that intra-corporate disclosures of consumers’ personal

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22 RODRIGUEZ V. SONY COMPUT. ENTM’T AM.

information between Sony entities to sustain the operations of

the PlayStation Network violated the Act.

AFFIRMED.

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