Resolving Issue of First Impression, Ninth Circuit Affirms Order Granting Defense Motion to Dismiss ECPA Class Action Alleging “Secondary Liability” Claims Under Federal Electronic Communications Privacy Act
DirecTV filed suit against an individual in Canada to enjoin the pirating of its satellite digital television signal and, in the course of that litigation, obtained a court order permitting it to seize evidence related to piracy activities that was accessed, recorded and processed by a third party, ICG. The order provided for the information “to be held in the ‘custody of [DirecTV’s] solicitors pending the trial” and for the appointment of an “independent solicitor”; DirecTV instructed, however, that all information was to be held by the independent solicitor rather than its own lawyers. After the Canadian action was completed, DirecTV filed suit in the United States against Lawrence Freeman, alleging that he engaged in “the distribution of illegal signal theft devices.” After the parties entered into a settlement and release of that lawsuit, Freeman filed a putative class action against DirecTV and ICG for allegedly violating the federal Electronic Communications Privacy Act (ECPA), 18 U.S.C. §§ 2702 and 2707. Freeman v. DirecTV, Inc., 457 F.3d 1001, 1002-03 (9th Cir. 2006). Defense attorneys moved to dismiss the action on three grounds; the federal district court granted the motion on the ground that “that 18 U.S.C. § 2702 does not provide a basis for asserting conspiracy and aiding and abetting claims.” Id., at 1004. The Ninth Circuit affirmed, summarizing at page 1009:
We hold . . . that the unambiguous language of 18 U.S.C. §§ 2702 and 2707 limits liability to providers of electronic communication services that knowingly divulge the contents of those communications while being stored by that provider.
In reaching that holding, the Ninth Circuit turned first to the plain language of the statute, which imposes liability on “providers” of electronic communication services:
[A]ny provider of electronic communication service, subscriber, or other person aggrieved by any violation of this chapter in which the conduct constituting the violation is engaged in with a knowing or intentional state of mind may, in a civil action recover from that person or entity, other than the United States, which engaged in that violation such relief as may be appropriate.
Freeman, at 1004 (quoting § 2707(a)). Because neither DirecTV nor ICG are “providers,” the Circuit Court observed that “the question is simply whether this statutory language creates a private right of action for conspiracy or aiding and abetting – a question of first impression.” Id.
The Circuit Court rejected the claim that one who “aids and abets or who enters into a conspiracy” is “engaged” in a violation of the ECPA because there is no language in the statute that suggests Congress intended to create a cause of action for “secondary liability” under the Act. Freeman, at 1005. The Court also rejected the invitation to “imply” an intent to create such liability on the theory that it is “consistent with the statute’s structure and subject matter,” id., at 1005-06, and concluded that the legislative history would not support such a holding, id., at 1006-07.