The Gap was recently hit with a class action, Carbajal v. The Gap, Inc., in the District Court of Arizona for its alleged use of “spy tracking pixels” in marketing emails sent to Plaintiffs who subscribed to The Gap’s email list.
The Baroness recently reported about the new wave of Arizona privacy litigation involving tracking pixels, under Arizona’s Telephone, Utility and Communication Service Records Law,” A.R.S. § 44-1376 et seq.
The Arizona law, enacted in 2006, prohibits businesses from collecting or attempting to collect “communication records” of email recipients without their consent:
A.R.S. § 44-1376 et seq. prohibits procurement of any “communication service record” (including email records) of “any resident of this state without the authorization of the customer to whom the record pertains, or by fraudulent, deceptive, or false means.” A.R.S. § 44-1376.01.
“‘Communication service record’ includes subscriber information, including name, billing or installation address, length of service, payment method, telephone number, electronic account identification and associated screen names, toll bills or access logs, records of the path of an electronic communication between the point of origin and the point of delivery and the nature of the communication service provided, such as caller identification, automatic number identification, voice mail, electronic mail, paging or other service features. Communication service records do not include the content of any stored oral, wire or electronic communication or a telephone record.” A.R.S. § 44-1376 (1)
Spy pixels, also known as tracking pixels or web beacons, are invisible files – .PNGs and .GIFs – that are often inserted in the content body of an email. When an email is opened, the tracking pixel is automatically triggered and allows a server to know the email has been read, amongst other activities.
The Gap complaint alleges that the spy pixel provided by third party PaeDae, Inc. dba Gimbal or Infillion, allows the Gap to collect, obtain, and track the time and place where Plaintiff opened the email, the average read time of the email, the amount of times an email was opened, and whether the email was printed, forwarded and how long the recipient looked at the email, the device the recipient used to look at the email, and even where the Plaintiff clicked within the email, the Gap class action lawsuit claims. The retailer can also track the marketing impact of the email, including a list of activities on a recipient’s computer or mobile device after viewing the email, the Gap class action lawsuit claims.
The lawsuit alleges the third party database then collects and obtains information which is used to generate data for leads and the third party links the collected information about the email recipient with additional data about the recipient that the third party purchases/possesses from other third parties including third party data brokers.
As a result, Plaintiff seeks to represent the following class:
“All persons in the State of Arizona who have opened a marketing email
containing a tracking pixel from Defendants during the two years preceding the filing of this Complaint.”
The Arizona law allows state residents to pursue remedies for violations of the Arizona law and seek $1,000 per violation and reasonable attorney’s’ fees.
“Spy” pixels used to track email activity are now another issue businesses must face in addition to CIPA related issues. This should be eye-opening and concerning for all businesses using email marketing, as these suits are on the rise — evidenced by similar lawsuits faced by other retailers like Urban Outfitters, Nordstroms, Marshalls, Homegoods, Saks and CVS.
With this new wave of litigation — this time focused on email marketing –it’s crucial for businesses to tread carefully and have a keen understanding of their marketing tools and data collection practices of their third party partners.
Happy Friday CIPAWorld — we’ll continue to keep an eye out on these new issues for you.
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