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A federal judge in California has refused to dismiss Google and YouTube from a proposed class action lawsuit accusing them of unlawfully collecting children's data to serve targeted ads. However, the judge has removed Cartoon Network, DreamWorks, Hasbro Studios, and several other owners of popular child-friendly YouTube channels from the long-running legal dispute.

U.S. Magistrate Judge Susan van Keulen issued a 34-page ruling on Monday, solidifying her earlier tentative decision to allow privacy claims and some state consumer protection law claims to proceed against Google. These claims were filed by children under the age of 13 who watched videos on YouTube, alleging the company violated privacy protections by gathering data without parental consent.

Previously, the court had dismissed earlier versions of the plaintiffs' claims based on the California Constitution's right to privacy and intrusion upon seclusion. The judge ruled that Google's data collection, while extensive, was not sufficiently "highly offensive" to sustain the privacy claims.

However, in her latest ruling, Judge van Keulen found that the plaintiffs had strengthened their case by providing new allegations about Google's knowledge of its illegal data collection. Specifically, the plaintiffs allege that content creators informed Google about YouTube’s non-compliance with the Children's Online Privacy Protection Act (COPPA), and that Google was aware that children frequently used the platform.

"Based on these allegations, the court may reasonably infer at the pleading stage that Google knew it was collecting children's data through YouTube in violation of COPPA," Judge van Keulen stated. "The court cannot conclude, as a matter of law, that knowingly violating a statute does not constitute highly offensive behavior."

The judge emphasized that this alleged knowledge distinguishes the case from earlier decisions where privacy claims were not upheld. The plaintiffs further argued that Google had created an internal narrative targeting children between the ages of 6 and 11, which led the court to reasonably infer that Google not only allowed children to use the main YouTube site but also tracked their data despite the existence of YouTube Kids.

While Google defended its actions, claiming that its privacy policies and terms of service were sufficient disclosures, Judge van Keulen rejected this argument. She noted that these terms did not provide clear evidence that the plaintiffs were aware of or consented to the data collection, particularly given the age of the children involved.

The plaintiffs have also been allowed to move forward with some of their allegations that Google violated state consumer protection laws by collecting minors' data without parental consent. The court found that the plaintiffs’ allegations of privacy loss provided grounds for pursuing damages under the laws of several states, including Indiana, Massachusetts, and New Hampshire. Additionally, the court determined that the plaintiffs could seek equitable relief under the laws of Florida, Massachusetts, Michigan, New Hampshire, and Tennessee.

However, the judge dismissed the claims against the various YouTube channel owners, such as Cartoon Network, Hasbro Studios, Mattel, and PocketWatch, as the plaintiffs did not show that these companies directly participated in the collection of data. "Unquestionably, the channel owners did not engage in that collection," Judge van Keulen wrote, rejecting any direct liability for them.

Furthermore, the judge agreed to dismiss the plaintiffs' unjust enrichment claims. She found that the plaintiffs had failed to demonstrate that the defendants were unjustly enriched, as users do not pay for access to YouTube, and the plaintiffs did not sufficiently challenge the defendants' arguments.

This decision marks a significant milestone in a case that has been ongoing for over five years. It follows a $170 million settlement in 2019 between Google, YouTube, the Federal Trade Commission (FTC), and New York’s Attorney General over allegations that YouTube violated COPPA by knowingly collecting children's data.

The case was initially dismissed by U.S. District Judge Beth Freeman in 2021, but the Ninth Circuit revived the lawsuit in 2023, ruling that state law privacy claims were not preempted by COPPA. The plaintiffs then filed multiple amended complaints, including a 191-page complaint in late 2023.

Although the case has faced several challenges, Judge van Keulen's ruling allows the litigation to continue against Google and YouTube. However, the claims against other defendants have been significantly narrowed.

Representatives for the parties could not be reached for comment. The plaintiffs are represented by attorneys from Pritzker Levine LLP and Silver Golub & Teitell LLP, while Google and YouTube are represented by Hogan Lovells. The various other defendants are represented by law firms including Gibson Dunn & Crutcher LLP, Munger Tolles & Olson LLP, and Venable LLP.

The case is Nichole Hubbard et al. v. Google LLC et al., case number 5:19-cv-07016, in the U.S. District Court for the Northern District of California.