Court Opinion

ID: 9363088
Source: CourtListenerOpinion
Date Created: 2023-01-13 18:57:03.892801+00
Date Added: 2024-06-11T17:15:28.459182
License: Public Domain

FOR PUBLICATION

      UNITED STATES COURT OF APPEALS
           FOR THE NINTH CIRCUIT

CARA JONES, as parent and guardian        No. 21-16281
of E.J., N.J., A.J., and L.J., minors;
JUSTIN EFROS, as parent and             D.C. No. 5:19-cv-
guardian of J.A.E. and J.R.E., Minors;     07016-BLF
NICHOLE HUBBARD, as parent and
guardian of C.H., a minor; individually
and on behalf of all others similarly       OPINION
situated; RENEE GILMORE, as
parent and guardian of M.W., a minor;
JAY GOODWIN, as parent and
guardian of A.G., a minor; BOBBI
DISHMAN, as parent and guardian of
C.D., a minor; PAULA RIDENTI, as
parent and guardian of R.A. and
R.M.A., minors; C.H.; E.J.; N.J.; A.J.;
L.J.; J.A.E.; J.R.E.; M.W.; A.G.; C.D.,

              Plaintiffs-Appellants,

 v.

GOOGLE LLC; YOUTUBE, LLC;
MATTEL, INC.; DREAMWORKS
ANIMATION LLC; HASBRO, INC.;
HASBRO STUDIOS, LLC; THE
CARTOON NETWORK, INC.;
CARTOON NETWORK STUDIOS,
INC.; POCKETWATCH, INC.;
2               JONES, ET AL V. GOOGLE LLC, ET AL

REMKA, INC.; RTR PRODUCTION,
LLC; RFR ENTERTAINMENT,
INC.,

                 Defendants-Appellees.

         Appeal from the United States District Court
             for the Northern District of California
        Beth Labson Freeman, District Judge, Presiding

            Argued and Submitted August 31, 2022
                     Seattle, Washington

                   Filed December 28, 2022

    Before: Michael Daly Hawkins, M. Margaret McKeown,
            and Gabriel P. Sanchez, Circuit Judges.

                 Opinion by Judge McKeown

                          SUMMARY *

    Preemption / Children’s Online Privacy Protection Act

    The panel reversed the district court’s dismissal, on
preemption grounds, of a third amended complaint in an
action brought by a class of children, appearing through their

*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
           JONES, ET AL V. GOOGLE LLC, ET AL                 3

guardians ad litem, against Google LLC and others, alleging
that Google used persistent identifiers to collect data and
track their online behavior surreptitiously and without their
consent in violation of the Children’s Online Privacy
Protection Act (“COPPA”).
    Google owns YouTube, a widely used online video-
sharing platform that is popular among children. Google’s
targeted advertising is aided by sophisticated technology that
delivers curated, customized advertising based on
information about specific users. Google’s technology
depends partly on what Federal Trade Commission (“FTC”)
regulations call “persistent identifiers,” which is information
“that can be used to recognize a user over time and across
different Web sites or online services.” 16 C.F.R. §
312.2. In 2013, the FTC adopted regulations under COPPA
that barred the collection of children’s “persistent
identifiers” without parental consent.
    The plaintiff class alleges that Google used persistent
identifiers to collect data and track their online behavior
surreptitiously and without their consent. They plead only
state law claims arising under the constitutional, statutory,
and common law of California, Colorado, Indiana,
Massachusetts, New Jersey, and Tennessee, but also allege
Google’s activities violate COPPA. The district court held
that the “core allegations” in the third amended complaint
were squarely covered, and preempted, by COPPA.
    The panel considered the question of whether COPPA
preempts state law claims based on underlying conduct that
also violates COPPA’s regulations. The Supreme Court has
identified three different types of preemption—express,
conflict, and field. First, express preemption is a question of
statutory construction. COPPA’s preemption clause
4              JONES, ET AL V. GOOGLE LLC, ET AL

provides: “[n]o State or local government may impose any
liability . . . that is inconsistent with the treatment of those
activities or actions under this section.” 15 U.S.C. §
6502(d). The panel held that state laws that supplement, or
require the same thing, as federal law, do not stand as an
obstacle to Congress’ objectives, and are not
“inconsistent.” The panel was not persuaded that the
insertion of “treatment” in the preemption clause here
evinced clear congressional intent to create an exclusive
remedial scheme for enforcement of COPPA
requirements. If exercising state-law remedies does not
stand as an obstacle to COPPA in purpose or effect, then
those remedies are treatments consistent with COPPA. The
panel concluded that COPPA’s preemption clause does not
bar state-law causes of action that are parallel to, or proscribe
the same conduct forbidden by, COPPA. Accordingly,
express preemption does not apply to the plaintiff class’s
claims. Second, even if express preemption is not
applicable, preemptive intent may be inferred through
conflict preemption principles. The panel held that although
express and conflict preemption are analytically distinct
inquiries, they effectively collapse into one when the
preemption clause uses the term “inconsistent.” For the
same reasons that the panel concluded there was no express
preemption, the panel concluded that conflict preemption did
not bar the plaintiffs’ claims.
    The panel reversed the district court’s dismissal on
preemption grounds, and remanded so that the district court
could consider in the first instance the alternative
arguments for dismissal, to the extent those arguments were
properly preserved.
          JONES, ET AL V. GOOGLE LLC, ET AL              5

                        COUNSEL

David S. Golub (argued), Steven L. Bloch, and Ian W. Sloss,
Silver Golub & Teitell LLP, Stamford, Connecticut;
Jonathan K. Levine, Elizabeth C. Pritzker, and Caroline C.
Corbitt, Pritzker Levine LLP, Emeryville, California;
Edward F. Haber, Shapiro Haber & Urmy LLP, Boston,
Massachusetts; for Plaintiffs Appellants.

Edith Ramirez (argued), Adam A. Cooke (argued), Michelle
A. Kisloff, and Jo-Ann Tamila Sagar, Hogan Lovells US
LLP, Washington, D.C.; Christopher Cox, Hogan Lovells
US LLP, Menlo Park, California; Helen Yiea Trac, Hogan
Lovells LLP, San Francisco, California; Christopher Chorba
and Jeremy S. Smith, Gibson Dunn & Crutcher LLP, Los
Angeles, California; Anna Hsia, Zwillgen Law LLP, San
Francisco, California; Jefferey Landis and Adya Baker,
Zwillgen Law PLLC, Washington, D.C.; Jonathan H.
Blavin, Munger Tolles & Olson LLP, San Francisco,
California; Jordan D. Segall and Ariel T. Teshuva, Munger
Tolles & Olson LLP, Los Angeles, California; Michael J.
Saltz and Elana R. Levine, Jacobson Russell Saltz Nassim &
De La Torre LLP, Los Angeles, California; Jeremy S.
Goldman, Frankfurt Kurnit Klein & Selz PC, Los Angeles,
California; David E. Fink and Sarah E. Diamond, Venable
LLP, Los Angeles, California; Angel A. Garganta, Venable
LLP, San Francisco, California; for Defendants-Appellees.

Derek L. Shaffer, Quinn Emanuel Urquhart & Sullivan LLP,
Washington, D.C.; Tyler S. Badgley, United States Chamber
Litigation Center, Washington, D.C.; for Amicus Curiae
Chamber of Commerce of the United States of America.
6              JONES, ET AL V. GOOGLE LLC, ET AL

                          OPINION

McKEOWN, Circuit Judge:

    The Children’s Online Privacy Protection Act
(“COPPA”), 15 U.S.C. §§ 6501–06, gives the Federal Trade
Commission (“FTC”) authority to regulate the online
collection of personal identifying information about children
under the age of 13. The statute includes a preemption
clause that provides that “[no] State or local government
may impose any liability . . . inconsistent with the treatment
of those activities or actions under this section.” Id. §
6502(d). Hewing closely to the language of the preemption
clause, we determine that Congress intended to preempt
inconsistent state laws, not state laws that are consistent with
COPPA’s substantive requirements, such as the state law
causes of action pleaded in the complaint here.
                        BACKGROUND
    Google, best known for its popular search engine, also
owns YouTube, a widely used online video-sharing
platform. YouTube videos are particularly popular among
children, who increasingly have smartphones and tablets that
allow them to access the platform without age verification.
As a testament to YouTube’s popularity among kids, several
popular toy and cartoon brands maintain YouTube
“channels,” where they post content and run advertisements
designed to appeal to young audiences.
    Google’s targeted advertising is aided by sophisticated
technology that delivers curated, customized advertising
based on information about specific users. Its tracking tools
can keep tabs on users’ search history, video viewing
history, personal contacts, browsing history, location
           JONES, ET AL V. GOOGLE LLC, ET AL                 7

information, and several other bits of information about
users’ habits and preferences, including activity on websites
and platforms not owned by Google. Together, these pieces
of information comprise detailed individual “profiles” of
users’ attributes and behaviors, extremely valuable tools for
the advertisers who seek to capitalize on this deep trove of
information about their targeted audiences. The revenue
from these targeted ads is split between Google and the
owners of the relevant YouTube channels; indeed, Google,
whose search and video platforms are largely free to its
users, makes most of its money through ad revenue.
    Google’s technology depends partly on what FTC
regulations call “persistent identifiers,” information “that
can be used to recognize a user over time and across different
Web sites or online services.” 16 C.F.R. § 312.2. Examples
include users’ Internet Protocol addresses (“IP addresses”),
numerical labels assigned to each device connected to the
Internet. Google tracks users’ IP addresses on all webpages
using Google’s advertising services. In 2013, the FTC
adopted regulations under COPPA that barred the collection
of children’s “persistent identifiers” without parental
consent. 16 C.F.R. §§ 312.2, 312.5.
    In this putative class action, plaintiffs are several minor
children (collectively “the Children”) suing through
guardians ad litem, alleging that Google used persistent
identifiers to collect data and track their online behavior
surreptitiously and without their consent. They seek
damages and injunctive relief, asserting only state law
claims: invasion of privacy, unjust enrichment, consumer
protection violations, and unfair business practices, arising
under the constitutional, statutory, and common law of
California, Colorado, Indiana, Massachusetts, New Jersey,
and Tennessee. The parties agree that all of the claims allege
8              JONES, ET AL V. GOOGLE LLC, ET AL

conduct that would violate COPPA’s requirement that child-
directed online services give notice and obtain “verifiable
parental consent” before collecting persistent identifiers.
    The complaint names two sets of defendants. First are
Google LLC and YouTube, LLC, which together own and
operate the YouTube platform (collectively “Google”).
Second are numerous content creators that uploaded child-
directed content to YouTube, including major toy brands and
a television network that showcases cartoons (collectively
the “Channel Owners”). Although the Children plead only
state law causes of action, they also allege that Google’s data
collection activities violated COPPA, and that Google
falsely represented that COPPA’s requirements did not
apply to YouTube, reasoning that it was a platform for
adults, even while knowing that children use the platform.
The complaint alleges that Google did not configure
YouTube to comply with COPPA until January 2020, after
reaching a settlement with the FTC and the New York
Attorney General in the fall of 2019. As for the Channel
Owners, the complaint alleges that they lured children to
their channels, knowing that the children who viewed
content on YouTube would be tracked, profiled, and targeted
by Google for behavioral advertising.
    The district court dismissed the Second Amended
Complaint, concluding that the Children’s claims were
expressly preempted by COPPA, 15 U.S.C. § 6502(d). The
Children filed a Third Amended Complaint, adding
additional details about the allegedly deceptive conduct.
The court again held that the “core allegations” in that
complaint were “squarely covered, and preempted, by
COPPA.” Regarding the deceptive conduct amendments,
the court held that the Children had again “failed to allege
deception beyond what is regulated by COPPA.” The court
           JONES, ET AL V. GOOGLE LLC, ET AL                9

granted the Children leave to file another amended
complaint “if they can substitute proper plaintiffs to
represent persons in the 13-16 age range”—i.e., older than
COPPA’s cutoff at 13 years old. The Children informed the
district court that they did not intend to further amend and
filed this appeal instead.
                          ANALYSIS
    Under COPPA and its regulations, companies that
operate websites and online services marketed toward
children must provide certain disclosures about their data
collection activities and must safeguard the confidentiality,
security, and integrity of the children’s personal online
information. 15 U.S.C. § 6501–06; 16 C.F.R. §§ 312.1–13.
COPPA does not authorize a private right of action. Rather,
the statute confers enforcement authority on the FTC, 15
U.S.C. § 6505(a), and on state attorneys general, who must
notify the FTC and cooperate with it to bring civil actions as
parens patriae, id. § 6504(a). Several other specified
agencies retain enforcement authority over the entities that
they oversee. Id. § 6505(b).
    This appeal presents the question whether COPPA
preempts state law claims based on underlying conduct that
also violates COPPA’s regulations. Preemption derives
from the Supremacy Clause, which “invalidates state laws
that interfere with, or are contrary to federal law.”
Hillsborough Cnty. v. Automated Med. Labs., Inc., 471 U.S.
707, 712–13 (1985) (quotation and citation omitted). The
Supreme Court has identified “three different types of
preemption”—express, conflict, and field. Murphy v.
NCAA, 138 S. Ct. 1461, 1480 (2018). The district court
based its dismissal on express preemption; Google and the
Channel Owners argue in the alternative that the claims are
10              JONES, ET AL V. GOOGLE LLC, ET AL

conflict-preempted. Field preemption was not argued by any
party and so we do not reach that question here. We review
de novo the district court’s dismissal of the complaint on
preemption grounds. Metrophones Telecomms., Inc. v.
Glob. Crossing Telecomms., Inc., 423 F.3d 1056, 1063 (9th
Cir. 2005), aff’d, 550 U.S. 45 (2007).
I. Express Preemption
    The “clear statement” rule provides that “Congress may
expressly preempt state law by enacting a clear statement to
that effect.” In re Volkswagen “Clean Diesel” Mktg., Sales
Pracs., & Prod. Liab. Litig., 959 F.3d 1201, 1211 (9th Cir.
2020), cert. denied sub nom. Volkswagen Grp. of Am. v.
Env’t Prot. Comm’n, 142 S. Ct. 521 (2021). Express
preemption is a question of statutory construction, requiring
a court to look to the plain wording of the statute and
surrounding statutory framework to determine whether
Congress intended to preempt state law. Id.; Nat’l R.R.
Passenger Corp. v. Su, 41 F.4th 1147, 1152–53 (9th Cir.
2022). Of course, congressional purpose “is the ultimate
touchstone in every pre-emption case,” Altria Grp. v. Good,
555 U.S. 70, 76 (2008) (quotation and citation omitted), but
the plain wording of the express preemption clause
“necessarily contains the best evidence of Congress’[s] pre-
emptive intent,” Puerto Rico v. Franklin Calif. Tax-Free Tr.,
579 U.S. 115, 125 (2016) (citation omitted). 1
     COPPA’s preemption clause provides:
        No State or local government may impose
        any liability for commercial activities or actions
        by operators in interstate or foreign commerce

1
 We assume without deciding that the presumption against preemption
does not apply.
          JONES, ET AL V. GOOGLE LLC, ET AL                11

       in connection with an activity or action
       described in this chapter that is inconsistent
       with the treatment of those activities or
       actions under this section.

15 U.S.C. § 6502(d) (emphasis added).
    Although the word “treatment” appears unique to
COPPA’s preemption clause, we note the similarity between
this provision and other preemption clauses barring
“inconsistent” state laws. Our decisions in Metrophones,
Ishikawa, and Beffa each involved clauses preempting state
laws “inconsistent” with federal statutes or regulations.
Metrophones, 423 F.3d at 1072 (statute preempted “State
requirements that are inconsistent with the Commission’s
regulations” (quoting 47 U.S.C. § 276(c))); Ishikawa v. Delta
Airlines, 343 F.3d 1129, 1132 (9th Cir.), amended on denial
of reh’g, 350 F.3d 915 (9th Cir. 2003) (statute preempted any
“law, regulation, standard, or order that is inconsistent with
regulations prescribed under this chapter” (quoting 49 U.S.C.
§ 45106(a))); Beffa v. Bank of the West, 152 F.3d 1174, 1177
(9th Cir. 1998) (statute preempted “any provision of the law
of any State . . . inconsistent with this chapter” or such
regulations (quoting 12 U.S.C. § 4007(b))).
    In each of these cases, we have read the statutory term
“inconsistent” in the preemption context to refer to
contradictory state law requirements, or to requirements that
stand as obstacles to federal objectives. We do not see that
Congress’s use of the phrase—“inconsistent with the
treatment of those activities or actions”—distinguishes this
case by changing the scope of the preemption clause. In
these prior cases, where state law was not inconsistent with
the methods of regulating, or treatment of, activities under
12            JONES, ET AL V. GOOGLE LLC, ET AL

the federal statute, we found express preemption
inapplicable. See Metrophones, 423 F.3d at 1073 (court
must ask “whether state law stands as an obstacle to the
accomplishment and execution of the full purposes and
objectives of Congress” (quotations and citation omitted));
Beffa, 152 F.3d at 1177 (statute did not preempt state law
negligence causes of action “that supplement, rather than
contradict” federal regulations); Ishikawa, 343 F.3d at 1132
(“[W]e cannot see how the duty the state common law
imposed . . . could be inconsistent with the federal
guidelines, which require the same thing with more
specificity.”). In each case, we held that the preemption
clauses did not bar state tort or contract laws imposing
obligations similar or identical to the substantive federal
requirements. In short, state laws that “supplement,” 152
F.3d at 1177, or “require the same thing,” 343 F.3d at 1132,
as federal law, do not “stand[] as an obstacle,” 423 F.3d at
1073, to Congress’s objectives, and so are not
“inconsistent.”
    Given this context, we are not persuaded that the
insertion of “treatment” in the preemption clause here
evinces clear congressional intent to create an exclusive
remedial scheme for enforcement of COPPA requirements.
Since the bar on “inconsistent” state laws implicitly
preserves “consistent” state substantive laws, it would be
nonsensical to assume Congress intended to simultaneously
preclude all state remedies for violations of those laws. If
exercising state-law remedies does not stand as an obstacle
to COPPA in purpose or effect, then those remedies are
treatments consistent with COPPA. Cf. Arellano v. Clark
Cnty. Collection Serv., LLC, 875 F.3d 1213, 1218 (9th Cir.
2017) (holding the Federal Debt Collection Practices Act
preempted state debt execution mechanisms because those
           JONES, ET AL V. GOOGLE LLC, ET AL                  13

mechanisms would enable debt collectors to “evade the
restrictions of the Act” and thus “thwart enforcement of the
[Act] and undermine its purpose”).
    Our reasoning comports with the long line of cases
holding that a state law damages remedy for conduct already
proscribed by federal regulations is not preempted. Cf. Bates
v. Dow Agrosciences LLC, 544 U.S. 431, 448 (2005) (“To be
sure, the threat of a damages remedy will give manufacturers
an additional cause to comply, but the requirements imposed
on them under state and federal law do not differ.”);
Medtronic, Inc. v. Lohr, 518 U.S. 470, 495 (1996) (“Nothing
in [21 U.S.C.] § 360k denies Florida the right to provide a
traditional damages remedy for violations of common-law
duties when those duties parallel federal requirements.”);
Wigod v. Wells Fargo Bank, 673 F.3d 547, 581 (7th Cir.
2012) (“The absence of a private right of action from a
federal statute provides no reason to dismiss a claim under a
state law just because it refers to or incorporates some
element of the federal law.”).
    We hold that COPPA’s preemption clause does not bar
state-law causes of action that are parallel to, or proscribe the
same conduct forbidden by, COPPA. Express preemption
therefore does not apply to the Children’s claims.
II. Conflict Preemption
    Even if express preemption is not applicable, “[p]re-
emptive intent may also be inferred” through conflict
preemption principles, Altria, 555 U.S. at 76–77, that is,
“when state law conflicts with a federal statute,” Ass’n des
Éleveurs de Canards et d’Oies du Québec v. Bonta, 33 F.4th
1107, 1114 (9th Cir. 2022). There are two types of conflict
preemption: (1) “‘conflicts’ that prevent or frustrate the
accomplishment of a federal objective,” and (2) “‘conflicts’
14             JONES, ET AL V. GOOGLE LLC, ET AL

that make it impossible for private parties to comply with
both state and federal law.” Geier v. Am. Honda Motor Co.,
529 U.S. 861, 873 (2000). Only the first type, which turns
on Congress’s “objective” in enacting COPPA, is at issue
here.
    Although express and conflict preemption are
analytically distinct inquiries, they effectively collapse into
one when the preemption clause uses the term
“inconsistent.” Metrophones, 423 F.3d at 1073. Under
either approach, the question is “whether ‘state law stands as
an obstacle to the accomplishment and execution of the full
purposes and objectives of Congress’” or the regulatory
agency with rulemaking authority. Id. (quoting Gade v.
Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88, 98 (1992)).
    For the same reasons that we conclude there is no express
preemption, we conclude that conflict preemption does not
bar the Children’s claims. We reverse the district court’s
dismissal of the third amended complaint on preemption
grounds. We remand so that the district court can consider
in the first instance the alternative arguments for dismissal,
to the extent those arguments were properly preserved.
     REVERSED AND REMANDED.