Another Blow to Data Breach Class Actions: Bell, et al. v. Blizzard Entertainment, Inc.

by BakerHostetler

On July 11, 2013, the U.S. District Court for the Central District of California dismissed a majority of the claims brought against Blizzard Entertainment, Inc. after a data breach suffered by Blizzard in 2012. In granting the motion for judgment on the pleadings, the decision highlights the continued difficulties faced by plaintiffs asserting claims against an entity that experiences a security breach.

Blizzard is a video game developer that produces online video games. Before playing any Blizzard game, customers must register for a account. When registering for a account, account holders agree to its terms of use and privacy policy. In addition, Blizzard introduced an additional level of security in 2008, the Authenticator, which created a random code which account holders must enter when logging in. In August 2012, Blizzard became aware that hackers gained access to account holders’ email addresses, answers to personal security questions and cryptographically scrambled versions of passwords. In response, a class action complaint was filed asserting the following claims against Blizzard: (1) violation of the Delaware Consumer Fraud Act (“CFA”); (2) unjust enrichment; (3) negligence per se; (4) negligence; (5) breach of contract; and (6) bailment.

In its decision, the Court dismissed all of the common law claims. In regards to the unjust enrichment claim, the plaintiffs alleged that Blizzard was unjustly enriched when it sold products that lost value as a result of security breaches, and then passed the costs associated with the security system onto the class members. The basis for plaintiffs’ allegations stem from the alleged assurances made in Blizzard’s terms of use and its privacy policy. Because the claim relates only to representations in contract (the terms of use and the privacy policy), the unjust enrichment claim could not survive.

To support their negligence per se claim, the plaintiffs alleged that Blizzard failed to inform its players of the breach in a timely manner which allegedly prevented plaintiffs from taking steps to protect their personal information. However, the factual allegations asserted by plaintiff did not state that any of their “personal information” as defined by the breach notification statute was taken nor did plaintiffs allege what information would be accessed if the hackers had gained access to their accounts. Therefore, the negligence per se claim was dismissed.

For the negligence and breach of contract claims, the Court held that plaintiffs failed to allege adequate harm. The Court noted that the plaintiffs did not allege that they were the victims of identity theft. The Court rejected plaintiffs’ argument that the increased risk of further harm was sufficient to support their claims. In addition, the Court found that the economic loss doctrine barred recovery for the decreased value of the video games purchased by plaintiffs. As a result of the plaintiffs’ failure to alleged sufficient harm, any alleged harm suffered by the plaintiffs as the result of the breach was speculative. Therefore, the negligence and breach of contract claims could not survive.

Finally, the Court dismissed plaintiffs’ bailment claim. Plaintiffs alleged that the duty of bailment arose when plaintiffs provided their personal information with Blizzard in order to create a account. The Court dismissed the bailment claim, noting that no court has held that personal information is chattel that can be bailed.

The Court permitted the claims under the CFA to move forward, but on narrow grounds. The plaintiffs claimed that Blizzard violated the CFA by omitting or misrepresenting the quality of its security measures. Specifically, plaintiffs alleged that Blizzard violated the CFA by failing to inform account holders that the purchase of the Authenticator is required for account safety. The Court found that Blizzard did not fraudulently misrepresent the security of plaintiffs’ personal information. In addition, Blizzard’s failure to disclose to account holders that they would be required to enter private information before playing games did not violate the CFA. However, because Blizzard could provide no explanation to the Court for why it failed to advise account holders that the purchase of the Authenticator at the point of sale would result in account safety, the Court permitted the CFA claim to go forward.

The Blizzard opinion follows a growing line of federal and state court cases dismissing negligence claims based on data breaches for lack of injury, particularly in cases like Blizzard, where the plaintiffs could not allege identity theft. In addition, the Blizzard decision shows the difficulty faced by plaintiffs in alleging common-law claims where plaintiffs and defendants have a contractual relationship.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BakerHostetler | Attorney Advertising

Written by:


BakerHostetler on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.