A Northern District of California judge has partially dismissed a case accusing Twitter, Inc. of violating California’s Unfair Competition Law (UCL) for misleading an advertising customer. DotStrategy, Co. brought the UCL misrepresentation claim against the social network, alleging it was wrongfully charged for advertisement interactions with “fake accounts that often [took] the form of an automated bot.”
The accompanying August 3 memorandum from Judge Charles R. Breyer noted that a “large number” of Twitter accounts are primarily controlled by bots rather than human beings. For example, in July 2018, Twitter deleted 70 million user accounts “it had deemed spammy, inactive, or which were displaying erratic behavior that indicated they were likely bots.”
DotStrategy, a marketing company, paid Twitter several thousand dollars to host advertisements for its services. Advertising customers pay Twitter “based on how many times users interact with the promoted account or content.”
The plaintiff claimed that it advertised with Twitter based on its representations “that advertisers would only be charged for interactions with ‘people,’” who DotStrategy hoped to attract as prospective clients. However, the plaintiff alleged, it was forced to pay for some interactions with bot accounts. Further, the plaintiff contended, Twitter failed to refund these charges, even after learning of the account holders’ true nature.
The court held that DotStrategy’s amended complaint adequately pled that it “suffered economic injury as a result of its reliance on Twitter’s false representation that advertisers would only be charged for interactions with ‘people.’” The court agreed that “[a] reasonable advertiser would understand [Twitter’s] statements to mean that they would not be charged—or would be offered a refund—for interactions Twitter knew involved an automated account.” The court further found that the plaintiff pled facts that “plausibly allege[d]” it had indeed paid for interactions with bot accounts, and “that Twitter failed to reimburse the money paid for those interactions despite knowing they involved automated accounts,” allowing the claim to proceed.
However, the court declined to deny to the motion as to DotStrategy’s claims that it had been wrongly charged for interactions with human-controlled “fake” accounts for two reasons. First, the court reasoned that the plaintiff failed to specify or define what constituted a fake, human-controlled account, and therefore its allegations were “insufficient to put Twitter on notice as to which of its statements were ostensibly false.” Second, the plaintiff failed to point to any “statement promising that Twitter advertisers would not be charged for interactions with ‘fake’ accounts that were controlled by people.”
The plaintiff is represented by Cera LLP and the David Hodges Law Office, and the defendant by Cooley and Haltom & Doan.
