A California federal district court recently dismissed a class action suit against Facebook that had alleged the social media giant improperly tracked logged-out users. In re Facebook Internet Tracking Litig., 140 F. Supp. 3d 922 (N.D. Cal. 2017). Plaintiffs in the action had asserted that Facebook breached its contractual obligation to users by tracking logged-out users on third party sites.

In dismissing the action, the court found that Facebook’s terms of use do not promise to limit the tracking of logged-out users. The court rejected plaintiffs’ arguments that Facebook’s “Data Use” policy or its help center pages were incorporated into Facebook’s terms of use by reference. For example, although Facebook’s data use policy states that it will receive data from third party websites that a user visits if a user is “logged into Facebook,” the court found that this provision was not incorporated into Facebook’s terms of use. The court similarly rejected plaintiffs’ argument that Facebook breached its duty to act in good faith, finding that Plaintiffs failed to point to any specific contractual provision to which to anchor their claims.

TIP: Companies that collect data from users should provide clear notice and make sure that all terms relating to such data collection are set forth in the terms of use or similar agreement.