Wearable Fitness Tracking Devices

Not long after these first cases, however, Fitbit faced a class action claim more like those made against Nike's FuelBand and Jawbone's UP. In particular, a plaintiff alleged that a number of Fitbit's more expensive devices included a sleep tracker function that was not accurate. See Complaint, Brickman v. Fitbit, Inc., No. 3:15-cv-02077-JD (N.D. Cal. May 8, 2015). Among other things, the plaintiff alleged that Fitbit's advertising claimed that the devices would “measure your sleep quality,” but what they actually tracked was only a measurement of a wearer's movement during sleep. Supposedly, this measurement, and the accelerometer technology used by Fitbit to make it, highly overestimates a user's actual sleep.

Fitbit moved to dismiss these claims. See Motion to Dismiss Complaint, No. 3:15-cv-02077-JD (N.D. Cal. July 1, 2015) [PACER Dkt. 21]. It argued that its tracker measures sleep through movement, an acceptable method, and that “Fitbit does not represent, warrant or guarantee that its trackers can deliver the accuracy or sophistication of medical devices or clinical sleep monitoring equipment.” Id. at 1. Fitbit further claimed that its statements related to sleep tracking in its advertisements and website are nothing more than non-actionable puffery. Id. at 9. In response, the plaintiff amended the complaint numerous times, and Fitbit filed a series of similar motions to dismiss, the most recent of which is currently pending before the court. See Motion to Dismiss Fourth Amended Complaint, No. 3:15-cv-02077-JD (N.D. Cal. Jan. 8, 2016) [PACER Dkt. 63].

In the meantime, different plaintiffs filed a class action complaint with respect to another supposedly inaccurate tracking function in several Fitbit devices. See Complaint, McLellan v. Fitbit, Inc., No. 3:16-cv-00036-VC (N.D. Cal. Jan. 5, 2016). These plaintiffs claim that the Fitbit Charge HR and the Fitbit Surge failed to track accurately a wearer's heartbeat during physical activity. When the plaintiffs exercised, they allegedly noticed that their trackers displayed heart rates significantly lower than their true heart rate, despite advertising from Fitbit promoting the heart rate monitor feature. These claims are pending, but as discussed below, Fitbit may have some good defenses to raise.

Arbitration Clauses and Class Action Waivers

In the Brickman and McLellan class actions against Fitbit, the plaintiffs face significant hurdles in the form of arbitration and class-action-waiver provisions in Fitbit's terms of service. See http://1.usa.gov/1SPD2nr. While the packaging that contains a Fitbit device does not set forth or include the terms of service, a Fitbit purchaser cannot use a Fitbit activity tracker ' not even just as a watch ' until the user creates an account at fitbit.com. See Amended Complaint, McLellan, No. 3:16-cv-00036-VC (N.D. Cal. Jan. 29, 2016) [PACER Dkt. 6]. To create an account, a user must accept Fitbit's terms of service.

Just as many cellular telephone companies added arbitration clauses to their terms of service as consumers began to file class actions, Fitbit's terms of service require that, after an informal e-mail dispute resolution opportunity, all disputes be settled by arbitration. (Users have 30 days to opt out of the arbitration clause via e-mail.) The arbitration clause bars all class-wide proceedings, including “[c]lass arbitrations, class actions, private attorney general actions, and consolidation with other arbitrations.” A user's claims against Fitbit are also limited to one year after they arise. Somewhat like the clause upheld in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740, 1744 (2011), Fitbit's arbitration clause also includes a promise by Fitbit to pay all arbitration fees for claims under $75,000, as well as a provision that Fitbit will only seek attorneys' fees and costs if a claim is found to be frivolous.

Fitbit is raising this arbitration clause in both the Brickman and McLellan cases. See Motion to Consider Whether Cases Should Be Related, Brickman, No. 3:15-cv-2077-JD (N.D. Cal. Feb. 4, 2016) at 1 [PACER Dkt. 66]. The plaintiffs in those cases argue that the arbitration clause is unconscionable, largely because the terms of service that contain it are not agreed to until after the consumer has purchased the device. See Opposition to Motion to Compel Arbitration and Dismiss Litigation, Brickman, No. 3:15-cv-02077-JD (N.D. Cal. Oct. 14, 2015) [PACER Dkt. 43]; accord Amended Complaint, McLellan, No. 16-cv-00036-VC (N.D. Cal. Jan. 29, 2016) [PACER Dkt. 6] (also arguing that despite the arbitration opt-out provision, the terms of service do not also provide opt-out provisions for the class action waiver or one-year statute of limitations). Given the United States Supreme Court's decisions favoring arbitration and class waivers, see, e.g., “Federal Arbitration Act wins again at the Supreme Court” (http://bit.ly/1XEKxS8), Fitbit appears to have a strong hand.

The Potential for Further Litigation

As these early cases against Nike, Jawbone and Fitbit illustrate, already there is a pattern for plaintiffs to follow with respect to wearables claims. But the consumer claims in those lawsuits are not by any means exhaustive. For example, on the heels of the McLellan complaint, a different plaintiff filed a securities class action claim against the company, alleging that Fitbit failed to disclose the inaccuracy of the technology used to monitor a user's heart rate. This complaint blamed the fall of Fitbit's stock price on the filing of the McLellan complaint. Robb v. Fitbit Inc., No. 3:16-cv-00151-SI (N.D. Cal. Jan. 11, 2016).

Of perhaps even more long-term significance, as consumers become more comfortable with 24-hour use of their wearable devices and the resulting stream of personal data being recorded, the public sharing of information monitored by fitness trackers is also increasing. Recently, a man who thought his wife's Fitbit was malfunctioning when it showed her heart rate as higher than normal posted on reddit.com, sought feedback about how to fix what he thought could be a faulty sensor. A commenter on the article suggested that rather than the Fitbit malfunctioning, his wife might be pregnant. A day later, the man disclosed that his wife was, in fact, pregnant. See http//bit.ly/22HQxec. While the man only generally discussed his wife's level of activity, time logged in the fat burning zone, and his belief that her calories burned did not seem to match the activity logged, other Fitbit users have publicly disclosed much more detailed information. Indeed, the user who suggested the man's wife may be pregnant had recently posted a 30-day snapshot of her own heart rate information to a Reddit subgroup, showing how her pregnancy had affected her heart rate. See http://bit.l6/26aLRlN; http://imgur.com/uGxc55x.

If this data is interesting when it is voluntarily disclosed, it is likely to be actionable if the disclosure is involuntary. To whom such data is transferred, who has the right to share it publicly, and the consequences for data being wrongfully disclosed will undoubtedly become the subject of significant litigation in the future ' and manufacturers should be aware of this. For example, in September 2015, in an attempt to bolster the use of its products in corporate wellness programs, Fitbit announced that it supported HIPAA compliance. See fitbit.link/1VxrZ8v. But, of course, compliance capability does not equate to actual compliance ' leaving open the question of exactly where the line will be between the management of the device, the data, and the user. To what extent other manufacturers follow Fitbit's lead, and the effect of any disparity between users who engage in a program that is HIPAA-compliant versus those that use the devices on an individual basis, is yet to be determined.

Conclusion

The current claims involving wearable technology are not going to be the last. So far, they reinforce the need for clear terms of service and careful advertising related to both the performance and accuracy of such devices, particularly when related to health and fitness. As Fitbit's HIPAA initiative indicates, privacy and data security issues are already important in this space, and will become more so. Finally, as shown by the cellular telephone industry example, effective dispute resolution planning is likely to become even more important as the wearables category expands.

Kristin Jamberdino and Christopher Mason are partners at Nixon Peabody LLP.

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