Judge Approves Mediator to Resolve Vizio Privacy Class Action Lawsuit

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On Monday, Vizio received word that a private mediator will be allowed to attempt to resolve claims in a proposed class action lawsuit that accuses the TV manufacturer of spying on the television-watching habits of its customers.

In addition to accusations of privacy violations, the lawsuit also alleges that the company sold viewer data to other companies to assist them with marketing products to Vizio users.

Plaintiff Pamela Reed filed the lawsuit against Vizio and Cognitive Media Networks Inc.  in November, claiming that Vizio installed software into its smart TVs that tracked viewer habits as part of the default setting on the television, then shared the data obtained with Cognitive Media. In turn, Cognitive Media sold the data to third party advertisers and content providers to market directly to Vizio users, according to Reed.

Magistrate Judge Laurel Beeler approved the order for the companies to enter into an alternative dispute situation with the plaintiff with the use of a mediator. Both sides will jointly agree on a mediator and will hold dispute resolution sessions. These sessions will take place before any hearings on class certification are held, according to the order.

On behalf of herself and the potential class, Reed seeks to represent a nationwide class of individuals who bought the Vizio TVs with preinstalled software and seeks damages for violations of the Video Protection Privacy Act (VPPA) as well as consumer protection and privacy laws in California. The estimated class size is expected to be in the hundreds of thousands.

Reed alleges that the “Smart Interactivity” software tracks user viewing habits not only on the smart TV, but also tracks viewing patterns on cable, internet, DVD players, and antennas. The Vizio class action lawsuit claims that the software records the channel, date and time of the programs viewed and combines the data with a consumer’s IP address. By accessing the IP address, Reed claims, other devices such as a cell phone using the same internet connection can also be identified.

Reed alleges that Vizio sends the user data they have collected to Cognitive Media Networks who then sells the data without user consent. She claims the technology is activated by default without express consumer consent, and that the process to opt out of the data tracking is difficult to find.

In December, another three class action lawsuits were filed against Vizio alleging that the company violated the Video Privacy Protection Act. These Vizio class action lawsuits were filed in Arkansas, California and Illinois. As of mid-December 2015, five lawsuits were filed against Vizio with similar allegations. Another five have been filed since, with the total number filed now equaling at least 11 class action lawsuits in total targeting Vizio.

According to a filing by Vizio in October with the U.S. Securities and Exchange Commission, Vizio purchased a controlling stake in Cognitive Media for approximately $50 million during the company’s IPO. The filing referred to Cognitive’s tracking software as having value for potential investors.

Reed is represented by Samuel M. Lasser and Rafey S. Balabanian of Edelson PC.

The Vizio Smart TV Tracking Software Class Action Lawsuit is Reed v. Cognitive Media Networks Inc., et al., Case No. 3:15-cv-05217, in the U.S. District Court for the Northern District of California.

UPDATE: On Apr. 11, 2016, the U.S. Judicial Panel on Multidistrict Litigation (JPML) centralized 20 class action lawsuits accusing Vizio of secretly installing tracking software in its Smart TVs to find out what users were watching.

UPDATE 2: On Nov. 7, 2016, a group of consumers alleging Vizio violates their privacy by illegally tracking what they watch is urged a federal court to reject the company’s motion to dismiss their class action lawsuit, saying the argument has a “catch-me-if-you-can quality.”

UPDATE 3: On Nov. 29, 2016, Vizio urged a judge to dismiss a class action lawsuit alleging it improperly collects and shares data about smart TV users’ habits without their consent, claiming the plaintiffs are misinterpreting federal privacy laws.

UPDATE 4: On July 25, 2017, a federal judge denied all of Vizio’s requests in its motion to dismiss and strike. 

UPDATE 5: On June 28, 2018, the preliminary agreement for the Vizio data privacy class action lawsuit settlement will be submitted to federal court in September.

UPDATE 6: On Oct. 4, 2018, smart TV owners reached a settlement worth $17 million in a class action lawsuit alleging Vizio secretly recorded and sold information about viewers’ watching habits.

UPDATE 7: On Feb. 8, 2019, the Vizio smart TV class action settlement is now open. Click here to file a claim.