We’re Going to Vegas! TCPA Class Action Transferred to Nevada Because Use of California-Based Text Platform Wasn’t Enough to Establish Personal Jurisdiction Over Caesars in California
Thursday, November 29, 2018

The “Ivy” AI text message platform is in the cross-hairs again in a class action filed against Caesars Entertainment Corporation in Castillo v. Caesars Entm’t Corp., No. 18-cv-05781-EMC, 2018 U.S. Dist. LEXIS 201721 (N.D. Cal. Nov. 28, 2018).  But unlike the class action involving the same platform against Treasure Island we reported on back in October, this one was filed in California and not in Vegas where Caesars is located.

Similar to the lawsuit against TI, the case against Caesars is based on Caesars’ use of the Ivy platform, which in a nutshell uses AI to provide text message concierge services to hotel guests.  Neat!  Plaintiff alleges that a single text he received from Caesars on the Ivy platform violated the TCPA because it was sent without his consent.  Not so neat.

It wasn’t disputed that Caesars was located in Nevada, didn’t take any action in California, and didn’t direct any action at California since the text was sent to Plaintiff while he was staying at Caesars.  Thus, there wasn’t anything to show that Plaintiff had met the standard of showing that Caesars had “purposefully directed” its actions to California.  So why was the case filed in California?

Plaintiff theorized that jurisdiction was proper because Caesars had worked with GoMoment, a California-based tech company, in the development and maintenance of the IVY platform.  The court correctly viewed this as an agency theory which rested on the contention that “even though Caesars itself is based in Nevada, GoMoment took action on behalf of Caesars in California, and GoMoment’s contacts with California may be attributed to Caesars.”

As recognized by the court, the law is murky over whether, and if so when an agent’s contacts may be attributed to its principal for jurisdictional purposes.  But even assuming attribution of agent contacts was permissible in the first instance, the court found that merely developing a platform that is used as a conduit by Caesars to communicate directly with its guests was too “attenuated” of a role to justify contact attribution for jurisdictional purposes.  Put simply, GoMoment’s location in California was just “happenstance” under those circumstances.

Finally, the Court found that even if it did have personal jurisdiction, Nevada was the more proper venue.  Plaintiff’s choice of venue was owed no deference since he was pursuing a class action, he didn’t reside in the Northern District of California (but instead the Central District), and the relevant event took place in Nevada, not California.  Thus, the court ordered the case be transferred to Nevada.

A nice little lesson in jurisdiction and venue here brought to you by the TCPA.  And one with application to many other contexts in which third party platform providers are used to send calls or texts.  In normal situations, those platform provider’s contacts shouldn’t be relevant to the question of jurisdiction.

It’ll be interesting to see if the “house always wins” adage will apply to this TCPA class action.  I’m taking bets!

 

NLR Logo

We collaborate with the world's leading lawyers to deliver news tailored for you. Sign Up to receive our free e-Newsbulletins

 

Sign Up for e-NewsBulletins