Tentative Ruling: Jane Doe et al vs Cottage Health
Case Number
23CV03679
Case Type
Hearing Date / Time
Fri, 03/20/2026 - 10:00
Nature of Proceedings
Motion: Approval
Tentative Ruling
For the reasons set forth herein, the motion of plaintiffs for preliminary approval of class action settlement and certification of settlement class is denied.
Background:
On August 23, 2023, plaintiff Jane Doe filed the original complaint in this action asserting seven causes of action against Cottage Health (Cottage): (1) violations of Penal Code section 630 et seq.; (2) violations of Civil Code section 56 et seq.; (3) violations of Business and Professions Code section 17200 et seq.; (4) violations of California Constitution, article I, section 1; (5) intrusion upon seclusion; (6) publication of private facts; and (7) breach of confidence.
On September 1, 2023, the court signed and entered an order granting plaintiff Jane Doe’s ex parte application to use a fictitious name in these proceedings.
On November 9, 2023, the parties stipulated to extend the time to respond to the original complaint. The stipulation identified plaintiff’s intent to file a first amended complaint and also stated that “Plaintiff informed Defendant of her successful efforts to consolidate this case with a federal case asserting nearly identical claims case on November 8, 2023.” (Stipulation, filed Nov. 9, 2023, p. 2.)
On November 14, 2023, the court signed and entered an order upon the parties’ stipulation, directing plaintiff to file an amended complaint by December 9, 2023, and defendant to file its response to that pleading by January 5, 2024.
On December 8, 2023, plaintiffs Laureen Clavecilla, Steve Crozier, and three others (Jane Doe, K.S., and C.M.), whose identities are confidential to preserve their confidential information, filed their first amended complaint (the FAC) against Cottage. (See FAC, ¶¶ 34-38.) The FAC asserts nine causes of action: (1) violations of Penal Code section 630 et seq.; (2) violations of Civil Code section 56 et seq.; (3) violations of Business and Professions Code section 17200 et seq.; (4) violations of California Constitution, article I, section 1; (5) intrusion upon seclusion; (6) publication of private facts; (7) breach of confidence; (8) violations of Civil Code section 1750 et seq.; and (9) negligence. As alleged in plaintiffs’ first amended complaint (FAC):
Cottage is a health system with five hospitals and medical centers, and 47 specialty care clinics and services located throughout the California Central Coast. (FAC, ¶ 39.) Cottage owns and controls a website, www.cottagehealth.org (the Website), which Cottage encourages patients to use, among other things, for finding medical care providers and medical services it provides, information concerning patients’ treatment options, and scheduling and location tools to aid patients in finding a facility and making an appointment. (FAC, ¶¶ 5, 49.)
The Website incorporates the Facebook Tracking Pixel (sometimes referred to as the “Pixel” or “Facebook Pixel”). (FAC, ¶ 11.) “Facebook” is third party Meta Platforms, Inc., dba Meta. (FAC, ¶ 1.) A pixel is a piece of code that tracks the people and the type of actions they take as they interact with a website, including how long a person spends on a particular web page, which buttons a person clicks, which pages they view, and the text or phrases they type into various portions of the website, such as the general search bar, chat feature, or text box. (FAC, ¶ 13.)
In addition to the Facebook Pixel, Cottage also installed and implemented Facebook’s Conversions Application Programming Interface (CAPI) on its website servers. (FAC, ¶ 17.) CAPI transmits information via Cottage’s servers and first-party cookies, bypassing ad blockers or consent denials, ensuring that private information is transmitted to Facebook even if patients have taken measures to prevent such data sharing. (FAC, ¶ 18.)
More specifically, website communications consist of HTTP or HTTPS Requests (Request) and HTTP or HTTPS Responses (Response) between a client device (operated by the user through a web browser) and a website hosted by a computer server. (FAC, ¶¶ 67-69.) A Request is a communication sent from the client device to the server; a Response is a reply to the Request. (FAC, ¶ 69.) A “cookie” is a small text file that can be used to store information on the client device to store information that can later be communicated to a server; a “third-party cookie” sends information to a website different from the website that is being visited. (Ibid.) When a user visits Cottage’s Website via a Request to Cottage’s server, Cottage’s server sends a Response including information to display the webpage (the Markup) and source code including the Pixel. (FAC, ¶ 72.) The source code instructs the user’s browser to duplicate the Requests to Cottage’s Website and to send those Requests also to Facebook. (FAC, ¶ 82.) These transmissions occur essentially simultaneously and without the user’s knowledge or consent. (FAC, ¶¶ 82-83.)
Each named plaintiff has used the Website to communicate specific information regarding past, present, and future health conditions and treatment and has been a Facebook user. (FAC, ¶¶ 181-200.) Plaintiffs K.S. and C.M. have each been patients at Cottage and used the Website. (FAC, ¶¶ 187, 194.) Each used the Website to communicate private medical information to Cottage. (FAC, ¶¶ 190-191, 195-198, 205-206.) Each expected that online communications with Cottage would be confidential and would not be transmitted or intercepted by a third party. (FAC, ¶¶ 193, 201.) As a result of the Facebook Pixel Cottage installed on its Website, plaintiffs’ information was intercepted, viewed, analyzed, and used by unauthorized third parties. (FAC, ¶ 202.)
In particular, Cottage’s Pixel has its own unique identifier, which can be used to identify which of Cottage’s webpages contain the Pixel. (FAC, ¶ 86.) Information transmitted via the Pixel included plaintiffs’ status as medical patients, health conditions, desired medical treatment or therapies, desired locations or facilities where treatment was sought, phrases and search queries entered in the Website search box, selection of physicians and their specialties conducted via the general search bar, classes and events hosted by Cottage and the times at which they were to be held, and costs of care and other financial inquiries. (FAC, ¶ 91.) This information was sent to Facebook together with plaintiffs’ Facebook ID (FID), thereby linking this information to unique Facebook accounts and the plaintiffs’ own identities. (FAC, ¶¶ 92, 119-123.)
The FAC asserts the claims on behalf of the named plaintiffs and as a putative class action on behalf of a class of California citizens who, during the “Class Period”, were patients and used the Website. (FAC, ¶ 229.) The “Class Period” is defined as “the period beginning on the date established by the Court’s determination of any applicable statute of limitations, after consideration of any tolling, concealment, and accrual issues, and ending on the date of entry of judgement or preliminary approval of a settlement.” (FAC, ¶ 230.)
On February 5, 2024, Cottage filed its demurrer to each of the causes of action of the FAC. The demurrer was opposed by plaintiffs.
On March 8, 2024, the court signed and entered an order granting plaintiffs’ motion to seal portions of paragraphs 34, 37, and 38 of the FAC that reveal the true names of plaintiffs Jane Doe, K.S., and C.M.
On July 30, 2024, the court signed and entered an order upon a stipulation by the parties, staying this matter for 90 days to allow the parties to mediate the case.
On August 1, 2024, Cottage filed a notice withdrawing its demurrer, requesting that the demurrer be taken off calendar, and requesting that the court not issue any tentative ruling or order on the demurrer.
On September 20, 2024, the court signed and entered an order upon a stipulation by the parties, extending the stay to November 26, 2024.
On November 21, 2024, the court signed and entered an order upon a joint status report and stipulation by the parties, that Cottage shall file a renewed demurrer within two weeks; and that plaintiffs shall file their opposition to that renewed demurrer within 28 days thereafter.
On December 5, 2024, Cottage filed its renewed demurrer to the FAC, which plaintiffs opposed. Cottage filed a notice of withdrawal of that demurrer on May 20, 2025.
On November 14, 2025, plaintiffs filed the present and unopposed motion for an order granting preliminary approval of a proposed Settlement Agreement and Release (the Settlement); appointing Simpluris as the “Settlement Administrator”; approving and directing the commencement of a notice plan as set forth in the concurrently filed declaration of Jacob Kamenir (Kamenir), who is the Vice President of Legal Notice at Simpluris; conditionally certifying the class for settlement purposes; appointing plaintiffs as the “Class Representatives”; appointing John J. Nelson of Milberg Coleman Bryson Phillips Grossman, PLLC, Mark S. Reich of Levi & Korsinsky, LLP, and Matthew J. Langley of Almeida Law Group LLC, as “Class Counsel”; approving the form and content of a “Summary Notice” and “Long Form Notice”, copies of which are attached as exhibits to the Settlement; staying or otherwise adjourning this action pending final approval of the Settlement; staying any actions brought by class members concerning any claims released pursuant to the Settlement; and scheduling a final approval hearing.
The motion is supported by a declaration of plaintiffs’ counsel, John J. Nelson (attorney Nelson). A copy of the Settlement is attached to that declaration. (Nelson Dec., Ex. A.)
The Settlement defines Cottage to include Cottage Health, Santa Barbara Cottage Hospital, Santa Ynez Valley Cottage Hospital, Goleta Valley Cottage Hospital, Cottage Medical Group, Pacific Diagnostic Laboratories, Cottage Clinical Network, and Cottage Clinical Associates. (Settlement, ¶ 1.) The term “Cottage Web Properties” is defined as “the webpages owned, operated, or associated with Cottage.” (Settlement, ¶ 2.)
The ”Settlement Class” consists of patients of Cottage “who logged into the patient portal from August 23, 2019 through August 23, 2023.” (Settlement, ¶ 26.) A “Settlement Class Member” is an individual who falls within the definition of the Settlement Class. (Settlement, ¶ 30.) Excluded from the Settlement Class are Cottage; its officers and directors; any judge assigned to this case and their staff and family; and any Settlement Class Member who timely and validly requests exclusion from the Settlement. (Settlement, ¶ 26.) The Settlement estimates the Settlement Class to consist of a total of 138,221 members. (Ibid.)
Pursuant to the Settlement, Cottage agrees to provide a one-year subscription to the CyEx Privacy Shield Pro product (the CyEx Privacy Shield), which is valued at over $330 per subscription. (Settlement, ¶¶ 4 & 33.) The Settlement requires the Settlement Administrator to send to each Settlement Class Member, a link, activation code, and instructions by email which must clearly explain how to enroll in one year of CyEx Privacy Shield. (Settlement, ¶ 34.) Each Settlement Class Member will have ninety days from the date they receive the activation code to enroll in CyEx Privacy Shield (the Enrollment Period.) (Ibid.)
CyEx Privacy Shield includes “Privacy Shield VPN”, which is described as a “military-grade encryption that allows users to access the internet on multiple devices-without exposure”; “Password Defense” which “makes it easy to secure online accounts with strong passwords and access these passwords across multiple devices[]”; “Data Broker Opt Out”, which allows users to eliminate personal information from data brokers;; “Privacy Search”, which automatically launches an anonymous search engine in a new tab to allow private online activity; and a “digital vault” which allows users to securely store their digital files and share them with family members. (Settlement, ¶ 33(a)-(e).)
The Settlement also obligates Cottage to review, update, and implement any necessary and commercially reasonable measures regarding its use of Meta Pixel, Google Analytics, other third-party pixels, and any similar technologies that provide analytics relating to visitor activities on websites (the Website Pixels) on the Cottage Web Properties, for the purpose of maintaining compliance with the Health Insurance Portability and Accountability Act. (Settlement, ¶¶ 32 & 35.) Cottage will provide a confidential declaration to Class Counsel explaining these measures. (Settlement, ¶ 35.)
The term “Notice” is defined in the Settlement to mean “notice of the proposed ... Settlement to be provided to Settlement Class Members” which must be substantially in the forms attached to the Settlement as exhibit A (the Short Form Notice) and exhibit B (the Long Form Notice). (Settlement, ¶ 11 & Exs. A-B.)
Within thirty days after entry of any “Preliminary Approval Order” (defined to mean an order directing issuance of Notice to Settlement Class Members; determining that the court will likely be able to approve the Settlement; and determining that the court will likely be able to certify the Settlement Class for purposes of resolving this action, among other things), Cottage will provide to the Settlement Administrator a list of the names and current or last known email and mailing address for each Settlement Class Member (the Settlement Class List), to the extent that information is reasonably available. (Settlement, ¶¶ 18, 29 & 36.) On that same date, the Settlement Administrator will disseminate the Short Form Notice to each Settlement Class Member for whom it has a valid email or mailing address, and make the Long Form Notice available on a website (the Settlement Website) which the Settlement Administrator will establish and use to provide each Settlement Class Member with information about the Settlement. (Settlement, ¶¶ 31, 36 & 38.)
The Settlement Website will contain, among other things, copies of the operative pleading, the Settlement; a “Claim Form”; the present motion and any motion for attorney’s fees, costs, or service awards that may be filed; and a toll-free telephone number, email address, and mailing address through which a Settlement Class Member may directly contact the Settlement Administrator. (Settlement, ¶ 38.) The Settlement Website shall remain operational until at least sixty days after the “Effective Date” which is defined as “one business day following the latest of: (i) the date upon which the time expires for filing or noticing any reconsideration or appeal of the Final Approval Order and Judgment, or entry of the Final Approval Order and Judgment if no person or entity has standing to appeal or seek reconsideration; (ii) if there is an appeal or appeals or reconsideration sought, the date on which the Final Approval Order and Judgment is affirmed without any material modification and is no longer subject to judicial review; or (iii) the date of final dismissal of any appeal or reconsideration or the final dismissal of any proceeding on certiorari with respect to the Final Approval Order and Judgment, and the Final Approval Order and Judgment is no longer subject to judicial review.” (Settlement, ¶¶ 6 & 38.) The term “Final Approval Order and Judgment” means “an order and judgment substantially in the form attached [to the Settlement] as [e]xhibit E that the court enters, which finally approves the Settlement [], certifies the Settlement Class, dismisses the [a]ction with prejudice, and otherwise satisfies the settlement-related provisions of the California Rules of Civil Procedure and is consistent with all material provisions of [the Settlement].” (Settlement, ¶ 8.)
A Settlement Class Member may exclude themselves or “opt-out” of the Settlement by submitting a “Request for Exclusion” to the Settlement Administrator. (Settlement, ¶ 40.) A “Request for Exclusion” is defined as “a writing by or on behalf of a Settlement Class Member in which he, she, or they request[] [sic] to be excluded from the Settlement Class in the form and manner provided for in the Notice....” (Settlement, ¶ 22.) A Request for Exclusion must be postmarked or submitted electronically by the “Opt-Out Deadline”, which is defined as a date no later than sixty days after the last day on which Notice must be issued to the Settlement Class (the Notice Deadline), and must include the name of the proceeding, the individual’s full name, information identifying the individual as a member of the class, a current address, a signature, and the words “Request for Exclusion” or comparable statement. (Settlement, ¶¶ 12 & 40(a).) Any Request for Exclusion which purports to exclude or opt-out more than one Settlement Class Member will be considered void. (Settlement, ¶ 40(b).)
Within seven days after the Opt-Out Deadline, the Settlement Administrator will provide to the parties, a complete and final list of all Settlement Class Members who have timely submitted a valid Request for Exclusion that has not been rescinded or successfully challenged. (Settlement, ¶¶ 15 & 40(c).) Individuals who opt-out of the Settlement will not be bound by its terms. (Settlement, ¶ 40(d).) To the extent more than 5 percent of the Settlement Class submits a timely and valid Request for Exclusion, Cottage will have the option to withdraw from and terminate the Settlement. (Settlement, ¶ 48.)
A Settlement Class Member may also object to the Settlement, including any request for attorney’s fees or costs, by either personally appearing at the final approval hearing to orally state their objection; or by submitting a written objection to the Settlement Administrator. (Settlement, ¶ 41(a)-(b).) A written objection must be postmarked or emailed no later than sixty days after the Notice Deadline and must: (i) set forth the Settlement Class Member’s full name, current address, telephone number, and email address; (ii) contain the Settlement Class Member’s original signature; (iii) contain proof that the Settlement Class Member is a member of the Settlement Class (e.g., copy of settlement notice, attestation of membership), including an attestation under that the objector is a Settlement Class Member; (iv) state that the Settlement Class Member objects to the Settlement, in whole or in part; (v) set forth a statement of the legal and factual basis for the objection; (vi) provide copies of any documents that the Settlement Class Member wishes to submit in support of his/her/their position; (vii) identify all counsel representing the Settlement Class Member, if any; (viii) contain the signature of the Settlement Class Member’s duly authorized attorney or other duly authorized representative, along with documentation setting forth such representation; and (ix) contain a list, including case name, court, and docket number, of all other cases in which the objector or the objector’s counsel has filed an objection to any proposed class action settlement in the past three years. (Settlement, ¶ 41(a).)
Within seven days after the deadline to submit objections to the Settlement, the Settlement Administrator will provide the parties with any objections that have been submitted by the members of the Settlement Class. (Settlement, ¶ 41(c).) Any Settlement Class Member who does not submit a timely or adequate objection pursuant to the procedures described above shall be bound by the terms of the Settlement. (Settlement, ¶ 41(b).)
The Settlement includes a release by the members of the Settlement Class. (Settlement, ¶ 49.) Pursuant to the terms of that release, each “Releasing Party” includes “the Settlement Class Representative and Participating Settlement Class Members, and each of their present or past spouses, heirs, estates, trustees, principals, beneficiaries, guardians, executors, administrators, representatives, agents, attorneys, partners, successors, predecessors-in-interest, assigns, and/or anyone claiming through them or acting or purporting to act for them or on their behalf.” (Settlement, ¶ 21.)
The ”Released Parties” are defined as “Cottage and each and every of its respective predecessors, successors, assigns, parents, subsidiaries, divisions, departments, owners, and related or affiliated entities of any nature whatsoever, whether direct or indirect, as well as any and all of Cottage’s and these entities’ respective predecessors, successors, officers, directors, employees, advisors, vendors, stockholders, partners, agents, attorneys, representatives, insurers, reinsurers, subrogees, and assigns.” (Settlement, ¶ 20.)
The “Released Claims” include any and all claims, liabilities, rights, demands, suits, actions, causes of action, obligations, damages, penalties, costs, attorneys’ fees, losses, and remedies of every kind or description-whether known or unknown (including Unknown Claims), existing or potential, suspected or unsuspected, asserted or unasserted, liquidated or unliquidated, legal, statutory, or equitable-that relate to or arise from Defendant’s use of third-party Website Pixels on Cottage Web Properties, the operative facts alleged in the Action, including the complaint and any amendment thereto, regardless of whether such claims arise under federal, state and/or local law, statute, ordinance, regulation, common law, or other source of law.” (Settlement, ¶ 19 & 49.)
The ”Unknown Claims” included in the Released Claims described above include all “claims Releasing Parties do not know or suspect to exist, which, if known by him, her or it, might affect his, her or its agreement to release the Released Parties or the Released Claims or might affect his, her or its decision to agree, object or not to object to the Settlement.” (Settlement, ¶ 50.) The Unknown Claims include an express waiver of any law, provisions, rights, or benefits of Civil Code section 1542, and of “any law of any state, the District of Columbia or territory of the United States, by federal law, or principle of common law, or the law of any jurisdiction outside of the United States, which is similar, comparable or equivalent to Section 1542 of the California Civil Code.” (Ibid.)
The release provides: “Upon the Effective Date, and in consideration of the Settlement benefits described herein, each Releasing Party shall be deemed to have completely and unconditionally released, acquitted, and forever discharged Defendant and each of the Released Parties from any and all Released Claims, including Unknown Claims.” (Settlement, ¶ 49.)
The Settlement also provides for service awards to each of the Class Representatives, in an amount not to exceed $1,000 for each representative, which Cottage agrees not to oppose. (Settlement, ¶ 51.) Cottage also agrees not to oppose any request by Class Counsel for attorney’s fees and costs which do not exceed $600,000. (Settlement, ¶ 52.) Cottage has also agreed to pay for expenses to administer the Settlement, separate from the costs associated with providing the CyEx Privacy Shield and other relief described above. (Settlement, ¶ 39.)
In support of the motion, attorney Nelson provides a description of the experience and skills of Class Counsel in regard to similar class action litigation. (Nelson Dec., ¶¶ 1-9 & Exs. 2-4.) Attorney Nelson also describes the efforts undertaken by plaintiffs on behalf of the Settlement Class. (Nelson Dec., ¶¶ 23-24.)
In addition, attorney Nelson states that Class Counsel conducted an investigation into the circumstances surrounding Cottage’s use of the Website Pixels, the scope of the alleged data that the use of the Website Pixels disclosed to unauthorized third parties, the injuries experienced by the Settlement Class, the applicable law and available causes of action, and the resulting potential damages available to the members of the Settlement Class. (Nelson Dec., ¶ 11.) Following that investigation, plaintiff Jane Doe filed their original complaint in this action, and plaintiffs Clavecilla and Crozier filed a complaint in federal court with nearly identical allegations. (Nelson Dec., ¶ 12.) The FAC consolidates those cases in this court. (Ibid.)
Shortly after Cottage filed its demurrer to plaintiff Jane Doe’s complaint, the parties discussed the possibility of early resolution and agreed to an exchange of informal discovery to aid those negotiations. (Nelson Dec., ¶ 13.) On November 8, 2024, the parties attended a full day mediation with mediator Benett G. Picker of Stradley Ronon Stevens & Young. (Ibid.) Though the matter did not settle at that mediation, and Cottage filed its renewed demurrer to the FAC, the parties continued their negotiations with the assistance of mediator Picker and agreed to continue the demurrer pending those ongoing discussions. (Ibid.)
Through the exchange of informal discovery, plaintiffs’ counsel learned the nature of the Website Pixels employed on the Cottage Web Properties, the dates during which they were active, the pages of the Website on which they were used, and the Website interactions the Website Pixels were configured to collect. (Nelson Dec., ¶ 14.) According to attorney Nelson, the information requested from and provided by Cottage was appropriately targeted at information relevant to the use of the Website Pixels and disclosures by Cottage, and to properly inform plaintiffs during settlement negotiations. (Ibid.) Plaintiffs reviewed and analyzed this information to determine the appropriate measure of settlement benefits to the Settlement Class. (Ibid.)
Attorney Nelson asserts that the parties’ negotiations were adversarial in nature, that the parties strongly advocated their respective positions, that the Settlement resulted from arms’-length negotiations between experienced counsel with an understanding of the strengths and weaknesses of their respective positions in this litigation, and that the parties did not discuss attorney fees or service awards until after the principal terms of the class relief had been negotiated. (Nelson Dec., ¶ 15.) In addition, Cottage confirmed that the Settlement Class is identifiable from its own records, and that the Settlement Class List can and will be provided to the Settlement Administrator. (Nelson Dec., ¶ 16.)
Though plaintiffs are confident in the success of this case if it were to proceed, attorney Nelson asserts that a trial of this action would entail substantial time, expense, and risk, and that counsel for Cottage would vehemently litigate this case at the pleadings stage, on summary judgment and class certification, and at trial and on appeal. (Nelson Dec., ¶ 19.) In addition, plaintiffs’ evaluation of the informal discovery provided by Cottage presented significant risks at summary judgment and in regard to class certification. (Ibid.) Attorney Nelson asserts that if Cottage were to succeed in disposing of this action, plaintiffs and the Settlement Class Members would receive no relief, and that, to the extent plaintiffs prevailed in certifying the class, any relief could be delayed for years. (Ibid.)
Attorney Nelson believes that the Settlement provides substantial benefits to the Settlement Class by eliminating the costs and burdens of continued litigation, and fully accomplishes plaintiffs’ goals by affording affirmative relief designed to protect information going forward, and to ensure that Cottage will take measures to prevent its disclosure. (Nelson Dec., ¶ 17.) According to attorney Nelson, the immediate benefits that the Settlement provides stand in contrast to the risks, uncertainties, expense, and delays of continued litigation which Class Counsel thoroughly assessed when considering its terms. (Nelson Dec., ¶ 18.) Attorney Nelson also states that the relief is appropriately tailored to the alleged injuries by providing tools to prevent internet tracking, and which allow the Settlement Class Members to affirmatively remove their personal information from online data brokers. (Ibid.)
Kamenir describes the experience of Simpluris in administering class action settlements, and of the measures taken by Simpluris to ensure data privacy and security. (Kamenir Dec., ¶¶ III-IV.) Simpluris anticipates that, based on information provided by the parties, the expenses to notice and administer the Settlement will total $39,950. (Kamenir Dec., ¶¶ V & XII.) Kamenir also describes the responsibilities of Simpluris pursuant to the terms of the Settlement. (Kamenir Dec., ¶ VI(1)-(8).)
Kamenir states that, prior to sending email notice, Simpluris will confirm that all email addresses received are properly formatted and able to receive that notice. (Kamenir Dec., ¶ VII.) If an emailed notice is returned or “bounced back,” Simpluris will make a second attempt to re-send the email notice where feasible. (Ibid.)
Prior to sending any notice by postcard, Simpluris will update the mailing address for each Settlement Class Member via the National Change of Address database, which provides updated address information for individuals or entities who have moved during the previous four years and filed a change of address with the United States Postal Service (USPS). (Kamenir Dec., ¶ VIII.) All addresses will be processed through the Coding Accuracy Support System and Locatable Address Conversion System to ensure deliverability. (Ibid.)
Postcards returned to Simpluris with a forwarding address will be re-mailed to the new address provided by USPS, and the Settlement Class Member database will be updated accordingly. (Kamenir Dec., ¶ IX.) Postcards returned to Simpluris by the USPS without forwarding addresses will be processed through a public records address verification search (commonly referred to as “skip tracing”) by utilizing a wide variety of data sources, including public records, real estate records, electronic directory assistance listings, to locate updated mailing addresses. (Kamenir Dec., ¶ X.) When new postal addresses are located, the Settlement Class Member database will be updated and the notice remailed. (Ibid.)
Analysis:
For the reasons discussed herein, the court will deny the motion, without prejudice to any future motion for preliminary approval of any revised settlement that may be agreed to by the parties.
“A settlement or compromise of an entire class action, or of a cause of action in a class action, or as to a party, requires the approval of the court after hearing.” (Cal. Rules of Court, rule 3.769(a).) “This is in order to ‘prevent fraud, collusion or unfairness to the class.’ [Citation.] ‘The court must determine the settlement is fair, adequate, and reasonable. [Citations.] The purpose of the requirement is “the protection of those class members, including the named plaintiffs, whose rights may not have been given due regard by the negotiating parties.” [Citation.]’ [Citation.]” (Luckey v. Superior Court (2014) 228 Cal.App.4th 81, 93 (Luckey).)
“Any party to a settlement agreement may serve and file a written notice of motion for preliminary approval of the settlement. The settlement agreement and proposed notice to class members must be filed with the motion, and the proposed order must be lodged with the motion.” (Cal. Rules of Court, rule 3.769(c).)
When a class action is settled before class certification under the procedure set forth in California Rules of Court, rule 3.769, “certification and settlement approval occur simultaneously.” (Luckey, supra, 228 Cal.App.4th at p. 93.) After the preliminary settlement hearing, the court makes “an order approving or denying certification of a provisional settlement class….” (Cal. Rules of Court, rule 3.769(d).) If the court grants preliminary approval of the settlement, the court’s order must include “the time, date, and place of the final approval hearing; the notice to be given to the class; and any other matters deemed necessary for the proper conduct of a settlement hearing.” (Cal. Rules of Court, rule 3.769(e).)
Code of Civil Procedure section 382 authorizes class actions “when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all.” (Code Civ. Proc., § 382.) “Class certification requires proof (1) of a sufficiently numerous, ascertainable class, (2) of a well-defined community of interest, and (3) that certification will provide substantial benefits to litigants and the courts, i.e., that proceeding as a class is superior to other methods. [Citation.]” (Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089.)
To determine whether a class is ascertainable, the court examines “(1) the class definition, (2) the size of the class, and (3) the means available for identifying class members. [Citation.]” (Reyes v. San Diego County Bd. of Supervisors (1987) 196 Cal.App.3d 1263, 1271.) “A related inquiry is manageability of the proposed class[.]” (Global Minerals & Metals Corp. v. Superior Court (2003) 113 Cal.App.4th 836, 849.) “The community of interest requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.” (Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d 462, 470.) “The burden is on the party seeking certification to establish the existence of both an ascertainable class and a well-defined community of interest among the class members.” (Washington Mutual Bank, FA v. Superior Court (2001) 24 Cal.4th 906, 913.)
“Because a court evaluating certification of a class action that settled prior to certification is considering certification only in the context of settlement, the court’s evaluation of the certification issues is somewhat different from its consideration of certification issues when the class action has not yet settled. In some ways, the court’s review of certification of a settlement-only class is lessened; as no trial is anticipated in a settlement-only class case, ‘the case management issues inherent in the ascertainable class determination need not be confronted.’ [Citation.] However, other certification issues, ‘those designed to protect absentees by blocking unwarranted or overbroad class definitions’ require heightened scrutiny in the settlement-only class context ‘for a court asked to certify a settlement class will lack the opportunity, present when a case is litigated, to adjust the class, informed by the proceedings as they unfold.’ [Citation.]” (Luckey, supra, 228 Cal.App.4th at pp. 93-94.) To protect absent class members whose rights may not have been considered by the settling parties, and to ensure the absence of fraud and collusion, heightened scrutiny is required if there has been no adversary certification. (Ibid.)
“The trial court has broad discretion to determine whether a class action settlement is fair and reasonable.... When the following facts are established in the record, a class action settlement is presumed to be fair: ‘(1) the settlement is reached through arm's-length bargaining; (2) investigation and discovery are sufficient to allow counsel and the court to act intelligently; (3) counsel is experienced in similar litigation; and (4) the percentage of objectors is small.’ [Citation.]” (Chavez v. Netflix, Inc. (2008) 162 Cal.App.4th 43, 52 (Chavez).)
Plaintiffs have filed or lodged with the motion, a copy of the Settlement, the Short Form Notice, the Long Form Notice, and a proposed order, as required by court rules. (Nelson Dec., Ex. 1 [Exs. A, B & D].) To the extent the Settlement requires the dissemination or publication of only the Short Form Notice and the Long Form Notice to the Settlement Class Members, the motion is procedurally appropriate.
The court notes that the Settlement also, and expressly, requires that the Settlement Administrator make available on the Settlement Website, a “Claim Form”. (Settlement, ¶¶ 36 & 38.) The Settlement does not define the term “Claim Form”. (See Settlement at pp. 2-5, ¶¶ 1-32.)
Under the circumstances present here and described above, and considering that the terms of the Settlement show or suggest that a Settlement Class Member is not required to submit a “Claim Form” to receive the link to enroll in CyEx Privacy Shield (see, e.g., Settlement, ¶ 24 [members will “automatically” be provided with the link] & Ex. B at p. 5, ¶ 9 [informing members that they are not required to submit a claim]), it is unclear to the court why the Settlement, which will be made available for review on the Settlement Website by members of the Settlement Class, references a “Claim Form”.
For the reasons discussed above, to the extent a member of the Settlement Class reviews the Settlement, there exist some concerns in regard to whether the reference to a “Claim Form” in the Settlement may give rise to some confusion in regard to the procedures for receiving the CyEx Privacy Shield enrollment link. Moreover, as the Settlement requires the Settlement Administrator to include a copy of the “Claim Form” on the Settlement Website, the motion is procedurally deficient as a copy of that “Claim Form” has not been filed.
Even if the court were to assume without deciding that the reference to a “Claim Form” is an inadvertent typographical error, additional concerns prevent the court from determining that the proposed Settlement is fair, adequate, and reasonable. (Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1800–1801.)
For reasons further discussed above, the court must examine the definition and size of the Settlement Class, as well as the means available for identifying its members. Though the court’s evaluation of certification issues is somewhat lessened here, the court applies heightened scrutiny as to any certification issues or matters that are intended to protect the rights of absent members of the class. (Luckey, supra, 228 Cal.App.4th at pp. 93-94.)
The motion explains that the causes of action alleged by plaintiffs arise from the use by Cottage of the Website Pixels on the Website or the Cottage Web Properties, which plaintiffs contend are in violation of California common law and several statutes. (Motion at p. 2.) The Website or Cottage Web Properties are generally described or defined as webpages which are owned, operated, or associated with Cottage. (See, e.g., FAC, ¶ 5; Motion at p. 2, ll. 20-22 [defining “Website”]; Settlement, ¶ 2 [defining “Cottage Web Properties”].) Plaintiffs contend that tracking tools embedded on the Website or Cottage Web Properties allowed third parties to view their and other Settlement Class Member’s interactions with the Website. (Motion at p. 2; Nelson Dec., ¶ 10.)
Available information and evidence also shows that Class Counsel investigated the use of the Website Pixels by Cottage, including the webpages on which those pixels were used; the scope of any data that was disclosed to unauthorized third parties; and the type of interactions the Website Pixels were configured to collect. (Nelson Dec., 11 & 14.)
Though the available information and evidence described above suggests that the Settlement Class consists of persons who used or otherwise interacted with the Website or Cottage Web Properties, the definition of the Settlement Class includes patients of Cottage “who logged into the patient portal” during the dates described above. (Settlement, ¶ 26.) The Settlement does not define or explain the meaning of the term “patient portal”. (See Settlement at pp. 2-5, ¶¶ 1-32.) The terms Website or Cottage Web Properties also do not reference a “patient portal”.
For all reasons discussed above, inasmuch as the present action arises from the use of the Website Pixels on the Website or Cottage Web Properties generally, and in the absence of any definition of the term “patient portal” or explanation as to why the Settlement Class is limited to those “patients” who logged into that portal, it is unclear to the court whether the rights of absentee class members, such as those who used the Website or Cottage Web Properties without logging into the patient portal, have been sufficiently considered or protected, or whether the definition of the Settlement Class is unwarranted.
The motion also includes an estimate of the size of the Settlement Class. That estimate suggests that the parties employed a means or method to identify the members of the Settlement Class. Wholly absent from the motion is any explanation or description of the means that were available to or employed by the parties to identify the size of the Settlement Class. Absent any explanation of the means or manner in which plaintiffs or Cottage determined that the Settlement Class consists of 138,221 members, the court is unable to determine whether those means are sufficient and reliable, whether the class is ascertainable, or whether there exists a well-defined community of interest among the members of that class.
The court has also reviewed the proposed Short Form Notice attached to the Settlement. Though that notice is easy to understand, it fails to apprise the members of the Settlement Class of their rights and obligations in connection with the proposed Settlement. For example, the Short Form Notice does not explain the benefits included in the Settlement in regard to the obligations of Cottage described above, or the release contained in the Settlement. For these reasons, the Short Form Notice, which is the only notice that will be provided directly to the members of the Settlement Class, fails to comply with due process. (Martorana v. Marlin & Saltzman (2009) 175 Cal.App.4th 685, 694-695.)
“The manner of giving notice is subject to the trial court’s virtually complete discretion.” (Chavez, supra, 162 Cal.App.4th at p. 58, original italics.) For the reasons discussed below, the manner of giving notice also appears insufficient or inappropriate.
Pursuant to the express terms of the Settlement, each member of the Settlement Class is necessarily a patient of Cottage who “logged into the patient portal”. (Settlement, ¶ 26.) To the extent the members of the Settlement Class are patients of Cottage with credentials to “log in” to the patient portal, this also suggests that Cottage is necessarily in possession of a mailing address for the Settlement Class. Instead of requiring a full class notice to be mailed to each member of the Settlement Class, or that an appropriate full class notice be published in a conspicuous location at Cottage’s physical locations or at the location of the “patient portal” where patients are most likely to be apprised of the Settlement, the Settlement contemplates the emailing of only the Short Form Notice which, for reasons further discussed above, does not comply with due process. (See, e.g., Settlement, ¶ 37 [requiring the mailing of the Short Form Notice only if a valid email address is not available].)
The Settlement also requires the Settlement Administrator to mail a “postcard” in the event a valid email address is not available. (Settlement, ¶ 37.) As a threshold matter, it is unclear from these terms whether the term “postcard” refers to the Short Form Notice. Assuming without deciding that the term “postcard” means the Short Form Notice, that notice only refers the members of the Settlement Class to the Settlement Website containing the Long Form Notice. There is no indication that either notice will be provided by any other manner or in any other location. In light of the matters further discussed above including the definition of the Settlement Class, it appears, under the totality of the circumstances present here, that there may exist more conspicuous means to provide patients of Cottage who logged into the patient portal with an appropriate class notice.
For all reasons further discussed above, it appears to the court that the proposed manner of providing notice is not the most feasible or appropriate means of providing adequate notice of the Settlement or its terms to absent class members. Therefore, the court is unable to determine that the manner of giving notice is sufficient to apprise putative class members of the Settlement.
For all reasons discussed above, the court is presently unable to determine from the available evidence and information, whether there exists a sufficient means available to identify the putative members of the Settlement Class; whether there exists a numerous, ascertainable class with a well-defined community of interest; whether plaintiffs’ claims are typical of the class; or whether plaintiffs can adequately represent the class. For these reasons, the motion fails to show reasonable support for provisional certification of the Settlement Class.
In addition, the benefits which the parties propose to confer to the Settlement Class include prospective relief requiring Cottage to review, update, and implement reasonable measures regarding its use of the Website Pixels to maintain compliance with statutory requirements. The Settlement does not state any deadline by which any such measures must be implemented, or any description of any reasonable measures to be reviewed, updated, or implemented by Cottage. The Settlement also includes no provisions prescribing the time period in which Cottage must provide the required declaration.
Furthermore, the deadlines within which a member of the Settlement Class must submit a Request for Exclusion or an objection to the Settlement are measured from a date which is no later than 30 days after the court enters a Preliminary Approval Order. Though the Settlement contemplates that a Short Form Notice may “bounce back”, requiring the Settlement Administrator to re-send a “postcard” by mail, and that the Settlement Administrator will conduct skip tracing to identify updated mailing addresses in the event a Short Form Notice is returned as undeliverable (Settlement, ¶ 37), the Settlement does not include any provisions by which any deadlines to submit a Request for Exclusion or objection will be appropriately adjusted in the event a notice must be re-mailed to a member of the Settlement Class. For these additional reasons, the court is unable to determine that the Settlement is fair or adequate.
The court also questions why a Settlement Class Member who submits an objection to the Settlement must include a list of all other cases in which that member or their counsel has filed an objection to any other proposed class action settlement within the past three years. (Settlement, ¶ 41(a).) The inclusion of such a requirement would appear to be intended to discourage the submission of any objections to the Settlement. For these reasons, the court cannot, on the present record, determine whether the Settlement is fair, or the product of collusion.
“A general release—covering ‘all claims’ that were or could have been raised in the suit—is not uncommon in class action settlements.” (Villacres v. ABM Industries Inc. (2010) 189 Cal.App.4th 562, 588.) A release in a class action settlement is impermissible if it “extends to claims outside the scope of the complaint.” (Amaro v. Anaheim Arena Management, LLC (2021) 69 Cal.App.5th 521, 535 (Amaro).)
Noted above, the Released Claims include the Unknown Claims, which include claims that the members of the Settlement Class “do not know or suspect to exist....” Considering that the release also includes a waiver of section 1542 of the Civil Code, the release impermissibly extends to claims outside the scope of those asserted in the FAC.
The court also notes that the definition of the term “Released Parties” is broad and includes, without explanation, unidentified “related or affiliated entities of any nature whatsoever”; employees, advisors, vendors, agents, attorneys, representatives, insurers, reinsurers, subrogees, and assigns of Cottage. To the extent those persons or entities have separate relationships with any member of the Settlement Class, the Released Claims do not appear to be appropriately limited to only those claims which are based on or reasonably arise from the facts alleged in this action, or fall within the scope of the allegations of the FAC. (See Amaro, supra, 69 Cal.App.5th at p. 538 [general discussion].)
The examples provided above are intended to be illustrative but not exhaustive. The court is not obligated to provide an itemized list of all concerns, and declines to issue an advisory opinion as to the manner in which the Settlement may be redrafted or whether any particular revision would render the settlement fair, adequate, or reasonable. As the court is presently unable to determine whether the settlement is reasonable, adequate, or fair, or that there exists no collusion or overreaching, the court will deny the motion.