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Appeals Court Defines Who is a Subscriber for Internet Apps and Services

The 11th Circuit Court of Appeals ruled that a person who accepts and uses a free app is not a subscriber to the app service provider because he did not:  provide any personal information to the provider, make any payments, register to use the service, receive a provider ID, establish a profile, sign up for any periodic services or transmissions, and did not make any commitment or establish any relationship “that would allow him to have access to exclusive or restricted content.” Ellis v. Cartoon Network, Inc., case no. 14-15046 (11th Cir. October 9, 2015) (Opinion Available Here), page 14.

The Video Privacy Protection Act 18 USC 2710 (“VPPA”) generally prohibits a “videotape service provider” from knowingly disclosing to a third-party “personally identifiable information concerning any consumer.” Ellis downloaded a free app from the Cartoon Network (a service provider) and the Network tracked Ellis’ activity on his smart phone and share this tracking information with a third-party data analytics company. The tracked data included all websites Ellis visited and all viewed video content.  The data analytics company further tracked Ellis’ activity based upon his smart phone Android ID through various websites and other mobile devices and returned this information back to Cartoon Network. “Cartoon Network did not provide Bango [the third-party data analytics company] with Mr. Ellis’ name, address, or social security number, but rather the combination of Mr. Ellis’ Android ID and video viewing records.” P. 6.  Ellis sued Cartoon Network for violating the VPPA.

The Act provides for a federal cause of action allowing aggrieved “consumers” (defined in the VPPA) allowing them to recover actual or liquidated damages of at least $2500 and attorneys fees and costs. The VPPA does not define the term “subscriber” and the Appellate Court noted that several district court decisions were split on the issue of who is a subscriber. Turning to dictionary definitions, the Appellate Court determined that subscriptions involve some or most of the following factors: payment, registration, commitment, delivery, express association, and/or access to restricted content.

In holding that Ellis, who downloaded a free app, was not a subscriber of the Cartoon Network, the Court found that the following factors to be determinative: providing personal information to the service provider, making payments, becoming a registered user, receiving a service provider ID, establishing a profile, signing up for periodic services, making a commitment or establishing a relationship to have access to exclusive or restricted content.

As a practice note, practitioners should be aware that terms of service or terms of use on a website do not convert the casual viewer into a “subscriber”. Therefore, the better practice is to utilize a click-on agreement with the consumer-viewer to assure a contractual relationship between the service provider and the user of the service.

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