PRIVACY QUAKE CONTINUES: California Invasion of Privacy Act Strikes in Massachusetts!

Hi TCPAWorld! The Baroness here 🙂 And it is definitely a HOT CIPA SUMMER.

The title says it all.

A California Invasion of Privacy Act case filed in… Massachusetts?! Not only is this BIG news but this is also very interesting.

Just a few days ago, a class action lawsuit was filed against Defendant Allego, Inc. for allegedly wiretapping communications of sales representatives and potential customers who contract with Allego.

But why did the plaintiff choose to file in Massachusetts?

As I’ve blogged about before, many defendants have been winning on motions to dismiss for lack of personal jurisdiction, and it is because more often than not they are being sued in a place where the plaintiff resides instead of where the defendant is incorporated or has its principal place of business.

It appears that Chan may have not wanted to take that chance and filed in California.

The defendant, Allego, Inc. is a Delaware company with its principal place of business in Massachusetts. So, of course Allego is subject to personal jurisdiction in Massachusetts.

But now why a CIPA claim and not a Massachusetts privacy claim?

Well because the plaintiff Joeleen Chan is a California resident who lives in Los Angeles, California.

Chan worked as a sales associate for Abbott Laboratories and Abott Laboratories contracted with Allego to obtain sales optimization services.

Chan alleges she was in California when she made each of her sales calls for Abbott Laboratories.

The Complaint alleges that “[c]ompanies employ Allego to provide sale optimization services. Part of the services offered by Allego is the recording of sales calls to create sales team training programs and to attempt to improve future sales call with the use of AI.”

And the plaintiff alleges that this is in violation of CIPA, Cal. Pen. Code § 631. But is it!?

As a refresh, Cal. Penal Code § 631 makes it illegal to read, or attempt to read, or to learn the contents or meaning of any message, report, or communication while the same is in transit or passing over any wire, line, or cable, or is being sent from, or received at any place within this state.

If Allego is in fact “recording” sales calls, the word recording is not even used in section 631.

The Complaint further alleges that after Allego records the calls, “[a]ll call recordings are run through an AI software program in real time, which analyzes each call and produces a report detailing how much time the sales rep spent talk or listening and whether the sales rep used specific key words or phrases and, if so, how many times those words and phrases were used.”

Still, would this be a violation of section 631?

Based on these alleged violations, Chan seeks to represent a class of “all California residents whose communications were intercepted or recorded by Allego.”

Very broad class.

This is interesting folks and we will definitely be keeping a very close eye on this one!

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Joelleen Chan v. Allego, Inc., Case No.: 1:23-cv-11781-DJC

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