We represent a wide spectrum of technology clients in a variety of challenges.

Platforms, Software and Consumer Technologies

• Meta in:
  • Obtaining dismissals of lawsuits brought by accounts that were shut down or companies labelled as Russia state-controlled media in efforts to address election interference.
  • Obtaining dismissals of class action lawsuits involving targeting tools on Facebook’s advertising platform, including a class action relating to Facebook’s alleged collection of users’ location-related information.
• An online service provider in:
  • Obtaining dismissal of all statutory damages claims and alleged violations of the federal Wiretap Act, and negotiating a favorable settlement to a class action lawsuit challenging its importing of users’ email contacts and sending them connection invitations.
  • Several matters against parties using bots or other technologies to scrape the provider’s website, create fake or unauthorized accounts, or otherwise disrupt its platform.
• Airbnb in:
  • Affirming a trial court decision that long-term San Francisco hotel residents have no causes of action against Airbnb for nuisance at properties caused by Airbnb users or unfair competition claims.
  • Obtaining an injunction enjoining a Boston ordinance requiring Airbnb to remove listings to operate in Boston and turn over private user data without any legal process.
• A social media platform in:
  • Multiple lawsuits claiming injuries from alleged minor “addiction” to social media.
  • Obtaining dismissal of claims alleging it is liable for individual defendants taking and sharing images of an assault of the plaintiff.
• Quotient Technology in defeating a temporary restraining order sought by a former business partner in a contract dispute over digital promotions services.
• Mattel in a class action alleging that operators of YouTube channels aimed at children collected personal information from users under the age of 13, in violation of the Children’s Online Privacy Protection Act and other laws.
• Lyft in:
  • Compelling arbitration of claims relating to use of Lyft app.
  • Multiple cases asserting that drivers using Lyft’s service should be treated as employees.
  • An antitrust challenge to its hiring and pricing practices brought by a purported class of private car service providers.

Video Games, Interactive, and Streaming Entertainment

• Electronic Arts, in successfully settling copyright litigation alleging that Zynga’s online social game ‘The Ville’ infringed EA’s copyrighted game ‘Sims Social.’ Munger, Tolles & Olson obtained a settlement after a motion to dismiss that involved Zynga withdrawing its game.
• Recording Industry Association of America (RIAA) in dismissing a lawsuit filed by Yout LLC, alleging RIAA improperly sent anti-circumvention notices to YouTube because Yout circumvents RIAA’s rolling cipher anti-piracy technology.
• Walt Disney Pictures, Twentieth Century Fox and Paramount Pictures, in obtaining summary judgment on claims for indirect profits by Rearden LLC on alleged secondary copyright infringement based on a third-party vendor’s use of Rearden’s motion capture software on six of the biggest films of the 2010s. On the seventh film at issue, a jury awarded Rearden less than $350,000 in profits, far less than the $38 million Rearden sought.
• Disney, Lucasfilm, Fox, Marvel, and other studios, in winning a $62.4 million jury verdict in a copyright infringement and circumvention action against the streaming service VidAngel.
• Alliance for Creativity in Entertainment, an organization that includes Amazon Studios, Netflix and other streaming services, in litigating multiple enforcement actions to shut down pirate streaming services.

FinTech, Cryptocurrency, NFTs 

• Block (formerly Square) in dismissing or compelling to arbitration two class actions brought under the Unruh Act by gun store owners and bankruptcy attorneys challenging restrictions in Square’s terms of service.
• An online payment platform in obtaining a dismissal of all statutory damages claims in a privacy class action alleging that the company improperly collects financial and other information from consumers using the payment form and subjects them to future tracking and profiling.
• NFT marketplace OpenSea in several matters, including concerning allegations of third-party theft of NFTs.
• An entertainment company in outlining an NFT strategy for licensing and enforcing its IP rights.
• A copyright and trademark owner in shutting down multiple infringing NFTs through DMCA notices and successful cease-and-desist efforts.

Hardware and Semiconductors

• Applied Materials in a federal criminal case and a civil lawsuit against former executives who conspired to misappropriate Applied trade secrets and two companies started by one of the executives. In the civil case, we successfully argued the matter should move ahead as a unified proceeding and resisted efforts to compel it to arbitration.
• Intel Corporation in:
  • Its agreement to sell its NAND flash memory solid state drive and wafer businesses to SK Hynix, a South Korean semiconductor manufacturer, for $9 billion USD through an unconventional, two-close structure.
  • Obtaining temporary restraining orders and preliminary injunctions against engineers who misappropriated trade secrets and confidential information and then destroyed evidence to cover it up.

Case Studies

We specialize in challenging matters that set important precedents, which is why clients turn to us when the stakes are high and they need a knowledgeable partner to help guide matters to an efficient resolution. Our work includes:

• Grayscale: An appellate victory over the SEC to enable a Bitcoin EFT

Munger, Tolles & Olson secured a significant appellate victory for Grayscale Investments, LLC, when the U.S. Court of Appeals for the D.C. Circuit vacated a Securities and Exchange Commission (SEC) order denying Grayscale’s bid to launch the first spot bitcoin exchange-traded product (ETP) in the United States. The court’s decision could well pave the way for greater investor access to bitcoin and other cryptocurrencies. Bitcoin prices surged on news of the ruling.

The petition for review in the D.C. Circuit challenged the SEC’s decision to block a national exchange’s request to convert Grayscale’s flagship product, Grayscale’s Bitcoin Trust (Symbol: GBTC), to a spot ETP that would hold and closely track the value of bitcoin. Such a conversion would confer significant benefits on investors, allowing them to easily gain exposure to bitcoin without investing directly in that asset—just as they gain exposure to stocks, gold, and other commodities when they purchase shares of ETPs that hold those assets.

As lead appellate counsel, MTO contended that the SEC’s decision was arbitrary, discriminatory, and in excess of the Commission’s statutory authority. MTO pointed out that the SEC had recently approved several bitcoin futures ETPs and that those ETPs were subject to exactly the same risks (if any) as a spot bitcoin ETP would be.

The appeal was argued before the D.C. Circuit by partner Don Verrilli in March 2023, building on strategies developed and briefs executed by partner Elaine J. Goldenberg. Siding with Grayscale, on August 29, 2023, a three-judge panel vacated the SEC’s order to deny the listing application and ordered Grayscale’s petition for review to be granted. The panel agreed that the SEC had not adequately explained how its denial here was consistent with its approval of two materially similar bitcoin futures ETPs. The panel concluded that “[t]he denial of Grayscale’s proposal was arbitrary and capricious because the Commission failed to explain its different treatment of similar products.” On October 13, 2023, the deadline for the SEC to appeal passed without a filing.

Grayscale Bitcoin Trust is the largest publicly traded bitcoin investment fund in the world. It holds about 3.4% of all outstanding bitcoin, with approximately $15 billion in assets under management, tens to hundreds of millions of dollars in daily trading volume, and nearly one million investor accounts in the United States.

Media Coverage: Understanding Grayscale’s victory in spot bitcoin ETF case

• Block: Defending Terms of Service Against Discrimination Claims

Block, Inc., (formerly Square, Inc.) in White v. Block, an important lawsuit for numerous internet services companies facing claims of discrimination regarding their terms of service. Plaintiff Robert White, a bankruptcy attorney, claimed that Square’s terms of service, which excluded accepting payments in connection with certain businesses and business activities, including bankruptcy attorneys, discriminate on the basis of occupation and thus violate the Unruh Civil Rights Act.

The case has a long procedural history, dating back to 2015, and involves multiple appeals at both the Ninth Circuit and California Supreme Court, where we were appellate counsel on the issue of standing. Numerous technology companies, such as Google, PayPal, Microsoft and Facebook, weighed in via the Internet Association in an amicus brief, reflecting the importance of the issues involved. The California Supreme Court held that to bring a claim like White’s against a web-based service, the plaintiff must allege that they visited the business’s website with the intention of making use of the business’s services and encountered discriminatory terms. The Court held that White’s allegations satisfied that standard, but emphasized that it was not addressing whether White’s claim of occupational discrimination was cognizable.

On remand, White voluntarily dismissed his federal complaint to refile in state court. We filed a demurrer arguing, inter alia, that White had failed to allege intentional discrimination on the basis of his status as a bankruptcy attorney, and that facially legitimate justifications underpinned Block’s terms of service. The San Francisco Superior Court agreed, dismissing the complaint on both grounds without leave to amend. White appealed and the California Court of Appeal, First District, heard the argument in July 2021.

The Court’s opinion, issued in July 2022, affirmed, finding that the terms of service were focused on transactions, not personal characteristics, and that Block had a legitimate business interest in avoiding the legal and financial risks associated with bankruptcy and debt collection payments.

Contact:

Jonathan H. Blavin
Carolyn Hoecker Luedtke