Wiretap Class Actions: Claims From Using Third-Party AI-Powered Technologies to Collect Customer Communications

Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Class Action and Other Litigation
- event Date
Thursday, August 29, 2024
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
-
This 90-minute webinar is eligible in most states for 1.5 CLE credits.
This CLE webinar will offer guidance to class action lawyers about the new wave of class action litigation and mass arbitration alleging that companies have violated state or federal wiretapping or privacy statutes by using third-party AI-driven algorithms to collect customer data for website analytic purposes. The program will review the technology, discuss plaintiffs' most current theories (and challenges), and suggest best practices for avoiding such claims in the first place.
Faculty

Mr. Ross represents clients in business disputes, commercial and securities litigation, government investigations, and class actions. He is ranked by Chambers USA in Securities Litigation (2023), where he is ranked in Band 1, and in Commercial Litigation (2023). Clients described him in Chambers USA as “an excellent attorney with a sophisticated knowledge of Florida law,” a lawyer who is “thorough in his analysis of the issues and creates workable, cost-efficient plans to solve them,” and “strategic, and thinks about the bigger picture and how to manage a difficult opponent” (2023). He has extensive experience defending his clients in high-stakes commercial and securities litigation, nationwide class actions, shareholder derivative suits, breach of fiduciary actions, state securities actions, and government investigations. Mr. Ross has defended his clients through trial in cases involving challenging financial, corporate governance, and damages issues. He has prevailed on dispositive motions, defeated class certification, and successfully won appeals on novel issues of materiality, reliance, and causation under Florida law. Mr. Ross writes frequently on emerging issues in securities and class action litigation, and his analysis has been featured in the Florida Bar Journal, the Journal of Health and Life Sciences Law, Law360, and the Daily Business Review. Ian also serves on the editorial board of the Enhanced Scrutiny blog, where the Sidley team provides timely updates and analysis on M&A and corporate governance matters from the Delaware courts.

Ms. Lally is a trial lawyer who practices in all areas of litigation, including class actions, false advertising claims, contract disputes, and real estate litigation. She serves as a global co-leader of Sidley’s Consumer Class Actions practice, which is ranked in Chambers USA for 2022 and recognized for its “deep bench noted for its expertise in the life sciences sector, having obtained a number of high-profile defense verdicts in this field.” Ms. Lally has broadly represented the consumer products and services industries in litigation arising under state and federal laws including California’s Proposition 65, Consumer Legal Remedies Act (CLRA), and the California Invasion of Privacy Act (CIPA); false advertising and unfair competition laws in California, New York, Illinois, and other states; and the Federal Wiretap Act, TCPA, Lanham Act, and other federal laws, regulations and guidance documents, including the FTC’s Green Guides. She is a leading member of Sidley’s California Consumer Privacy Litigation Task Force, a dedicated group of lawyers focused on the California Consumer Privacy Act (CCPA) and California Privacy Rights Act (CPRA), counseling clients on how to assess and mitigate litigation risks by putting in place the policies, procedures, and protocols that comply with the new laws. Ms. Lally's clients include numerous consumer goods manufacturers and retailers, including vitamin and dietary supplement companies, cosmetic companies, conventional food and beverage companies, pharmaceutical companies, apparel and fashion companies, furniture and home goods companies, and e-commerce companies. She has represented a wide variety of other businesses such as financial institutions, hedge funds, accounting firms, and oil and gas companies.

Mr. Abramson is a Partner at Milberg who has served as co-lead counsel in numerous successful consumer protection, insurance, securities fraud, and product defect class actions. Prior to joining Milberg, Mr. Abramson practiced at Berger Montague PC and Dechert LLP in Philadelphia, where he handled complex commercial litigation and class actions across a wide range of practice areas including securities, financial services and insurance, product liability, and whistleblower suits. He is a graduate of Cornell University (B.A. with distinction, 1993) and Harvard Law School (cum laude, 1996). Mr. Abramson is a past member of the Harvard Legal Aid Bureau and is a member of Cornell University’s Phi Beta Kappa honors society.
Description
Hundreds of class actions and more recently, mass arbitrations, have alleged that website analytical technologies, such as session replay, tracking pixels, and chatbots, illegally intercept customer communications in violation of federal and state wiretapping laws and state privacy laws, including the California Invasion of Privacy Act. In the past, these claims generally have been dismissed on grounds that mouse movements, keystrokes, and similar data input by a user do not convey any type of substantive communication, that the user consented to the disclosure, or that third-party vendors were not intercepting communications in transit or using the information for their own purposes.
Courts from California to Massachusetts, however, are reconsidering these defenses in light of newer forms of website technologies, especially with the use of AI when the data is sent back to the software vendor to improve the AI software product. One California court has allowed a claim to go forward for aiding and abetting the wiretapping (by the third-party vendor) and another because the plaintiffs simply alleged that the vendor had the capability for such use.
There are several meritorious and effective defenses to these claims, but many businesses may not know that they are at risk of wiretap lawsuits, may assume incorrectly that they are already protected, do not know what these defenses are, or do not know what action should be taken.
Listen as this distinguished panel discusses the latest developments in class actions alleging undisclosed tracking software.
Outline
- Overview of website analytical technologies
- Purposes of federal and state wiretapping, privacy statutes
- How plaintiffs allege violations occur
- Defenses
- Recent cases
- Mitigation strategies
Benefits
The panel will review these and other relevant issues:
- Is prior or contemporaneous consent required to defeat claims based on AI-infused software?
- What is needed to establish standing?
- Are third parties actual "parties" to a communication?
- What might be special concerns in the healthcare setting?
Related Courses

Privacy Class Actions and AI-Based Tools: Impact of Algorithmic Disgorgement and FTC Enforcement
Friday, April 11, 2025
1:00 p.m. ET./10:00 a.m. PT

Concurrently and Ethically Representing Companies, Owners, and Employees in the Same Matter
Friday, May 2, 2025
1:00 p.m. ET./10:00 a.m. PT

Authenticating Disputed E-Signatures at Trial: ESIGN and UETA, Experts, Burdens of Proof, Audit Trails
Friday, February 28, 2025
1:00 p.m. ET./10:00 a.m. PT

Drafting and Responding to Contention Interrogatories: Strategies and Best Practices
Friday, April 4, 2025
1:00 p.m. ET./10:00 a.m. PT
Recommended Resources
Explore the Advantages of Consistent Legal Language
- Learning & Development
- Business & Professional Skills
- Talent Development