18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 657 benefits plan. Defendants, the State Teachers Retirement Board ("STRB") and the STRB’s individual board members ("Individual Defendants"), filed a motion to dismiss. The Magistrate Judge recommended granting the motion, and the Court subsequently adopted the findings and granted the motion. Plaintiff did not challenge the dismissal of the Individual Defendants based on qualified immunity. The STRB’s defined benefit plan was funded by: (i) employee contributions; (ii) employer contributions; and (iii) investment earnings from the foregoing contributions. The Magistrate Judge also recommended dismissing Plaintiffs’ claims against the STRB based on Eleventh Amendment immunity. The Court noted that the STRB was entitled to Eleventh Amendment immunity if it operated as an arm of the State, which included analysis of four factors, including: (i) the State’s potential liability for a judgment against the entity; (ii) the language by which state statutes and state courts refer to the entity and the degree of state control and veto power over the entity’s actions; (iii) whether state or local officials appoint the board members of the entity; and (iv) whether the entity’s functions fall within the traditional purview of state or local government. Id . at *8. The Magistrate Judge determined that the first factor weighed in favor of the STRB because the State would face potential liability for a judgment against the STRB. Further, the Magistrate Judge observed that all state statutes and how state courts referred to the STRB weighed in favor of the STRB as the STRB’s level of autonomy was dictated by state statute. The Magistrate Judge also explained that Ohio Rev. Code § 171.01 establishes the "Ohio retirement study council," which reviews the policies, objectives, and criteria of the state retirement systems and boards, like the STRB, and submits a report to the Governor and General Assembly. Id . at *17. The Magistrate Judge concluded that the council’s existence pursuant to statute indicated that the State had shown its intent to assert some level of control over and/or review of the STRB. The Magistrate Judge determined that as per the statute, the Governor, State Treasurer, Speaker of the House, and Senate President appointed four members of the Board, five additional members were "contributing members," and two were "retired teacher members.” Id. at *18. Thus, four of the eleven members of the board were appointed by the State and its officials. Finally, the Magistrate Judge held that the state teachers retirement system was for the benefit of retired teachers who taught statewide, and was created as "a substantial and integral factor in securing and retaining qualified teachers, thus improving the quality of instruction in the public school system" across the entire state. Id . at *19-20. The Magistrate Judge therefore concluded that Defendant met it burden of demonstrating that it was an arm of the state and entitled to Eleventh Amendment immunity. The Court agreed with the Magistrate Judge’s recommendation in its entirety. Accordingly, the Court granted Defendant’s motion to dismiss. Divino Group, LLC, et al. v. Google LLC , 2021 U.S. Dist. LEXIS 3245 (N.D. Cal. Jan. 6, 2021). Plaintiffs, a group of LGBTQ+ content creators on YouTube, filed a class action alleging that Defendant YouTube and its parent company Google discriminatorily censored Plaintiffs’ YouTube videos on the basis of their sexual or gender orientation, identity, and/or viewpoint. Specifically, Plaintiffs claimed that Defendants unlawfully censored Plaintiffs’ LGBTQ+ content by flagging the videos as “potentially adult” content and by “demonetizing” their videos, i.e. , preventing advertisements from running on Plaintiffs’ videos. Id. at *9. Plaintiffs asserted various causes of action, including: (i) violation of the First Amendment under 42 U.S.C. § 1983; (ii) violation of the Unruh Act and Article I of the California Constitution; (iii) unfair competition; (iv) breach of the implied covenant of good faith and fair dealing; and (v) false advertising in violation of the Lanham Act. Id. at *2. Plaintiffs also sought declaratory relief that § 230 of the Communications Decency Act (“CDA”) was unconstitutional and that Defendants violated their rights as alleged in the complaint. Defendants filed a motion to dismiss, which the Court granted. The Court noted that, to state a claim for First Amendment violations under § 1983, Plaintiffs must show that the Defendant acted under color of state law. Id. at *12. Here, Plaintiffs contended that Defendants amounted to state actors by “designating YouTube as a public forum for free expression” and by invoking the protections of the CDA, a federal statute, to defend themselves from claims of discrimination. Id. at *13. The Court rejected these arguments It reasoned that the Ninth Circuit’s recent decision in Prager University v. Google LLC , 951 F.3d 991 (9th Cir. 2020) – which found that YouTube hosting speech on a private platform was not a traditional and exclusive government function – plainly overruled Plaintiffs’ contention. Id . The Court further held that Prager foreclosed Plaintiffs’ false advertising claims as well, given that the Ninth Circuit in Prager considered analogous claims and concluded that YouTube’s censorship methods were “accurate explanations of the application of YouTube’s content review and monitoring procedures” rather than advertisements. Id. at *25. Moreover, the Court opined that § 1983 applies to actions taken under color of state law rather than federal law, so it accordingly rejected Plaintiffs’ argument with respect to the CDA. In terms of Plaintiffs’ state law claims, the Court declined to exercise supplemental jurisdiction because “the factors of