Fox Rothschild has achieved a significant legal win for international fashion retailer H&M, earning complete dismissal of a privacy class action lawsuit filed against the company in Arizona state court concerning the use of tracking pixels in emails.

This major decision, achieved without oral argument, is likely to set a crucial precedent for similar cases involving Arizona’s Telephone, Utility, Communication Service Records Act (TUCSRA). The ruling is expected to have far-reaching implications for ongoing litigation against large retailers in the state.

Fox Rothschild attorneys Odia Kagan and Philip Abbruscato represented H&M in the case, in which Arizona Superior Court Judge Wayne E. Yehling granted H&M’s motion to dismiss without leave to amend, accepting all arguments that were presented, including those regarding standing.

The plaintiffs argued that H&M’s use of “email read receipt” technology, which allows senders to request notification when recipients open their email, violated TUCSRA by revealing information about the reader’s device, location and number of times the email was accessed. The technology typically works by embedding a tiny, invisible image or using other tracking methods in the email.

“We were pleased to secure this important win for H&M and expect it to serve as a guide for other companies facing similar class action litigation under TUCSRA,” said Kagan, the firm’s Chair of Data Privacy Compliance & International Privacy. “Concurrently with class litigation defense our team prioritizes anticipating litigation and enforcement trends and helping companies best comply with their many data privacy obligations.”

Key points from the court’s decision include:

• H&M is not classified as a communication service provider under TUCSRA, as it does not provide services allowing users to send or receive communications.
• Information collected by email tracking pixels is not considered a protected “communication service record” or “access log” under TUCSRA.
• The court rejected the plaintiff’s expansive interpretation of TUCSRA, stating that the definitions of “communication service record” and “access log” in the statute are unambiguous.
• The plaintiff was found to lack standing due to the absence of a distinct and palpable injury, with the court noting that the information collected would not be highly offensive to a reasonable person.

Fox Rothschild’s effort was supported by the Retail Litigation Center, which filed an amicus brief in the case. The decision is expected to significantly impact other pending cases related to TUCSRA against key retailers, many of which are in preliminary stages.

As this article contains statements regarding past performance, please note that results may vary depending on your particular facts and legal circumstances.