State high court reinstates TV Guide lawsuit


LITTLE ROCK — The state Supreme Court on Thursday reversed a circuit judge’s dismissal of a class-action lawsuit against TV Guide Holdings Inc. and ordered a new hearing.

The lawsuit, filed in Washington County Circuit Court, alleges that TV Guide illegally harvested personal website information from the users using online Flash cookies.

Sharon Roller, Valerie Murphy and Emily Smith, subscribers to the TV Guide website, filed the lawsuit against the Los Angeles-based company arguing that when they accessed the website Flash Cookies were downloaded onto their computers without their knowledge, permission or consent.

Flash cookies are codes used to gather and store the users’ personal information, their preferences and other information, including how often they visit the site. The information is used for marketing purposes.

In January, Washington County Circuit Judge Mark Lindsey dismissed the lawsuit, saying TV Guide’s online user agreement stipulated that any legal action must be filed in Los Angeles or federal court.

In their appeal, the three women argued that they properly pleaded subject-matter jurisdiction and venue in their complaint and that TV Guide did not meet its burden of proof to establish that venue was improper in Washington County.

In a unanimous decision Thursday, the high court agreed, saying TV Guide’s user agreement was not effectively communicated to the women.

“TV Guide’s assertions that appellants had notice of the agreement stem from appellants’ mention of the agreement in their complaint,” Justice Karen R. Baker wrote for the court. “However, this is insufficient as the dispositive issue in determining if an enforceable agreement existed is whether appellants had constructive or actual knowledge of the terms of the agreement and therefore agreed by their use of TV Guide’s website to be bound by those terms.”

Baker said that in a previous decision, the Supreme Court ruled that a reference to the existence of license terms on a submerged screen is not sufficient to notify consumers of those terms.

“Here, TV Guide failed to meet its burden to show an enforceable agreement existed between it and appellants; thus, it has likewise failed to establish the venue was improper in Washington County,” she wrote.