In Re Alphabet Inc. Stockholder Derivative Litigation

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

IN RE ALPHABET DERIVATIVE

Case No. 19-cv-06880-RS

STOCKHOLDER LITIGATION

ORDER GRANTING MOTION TO

DISMISS 13

I. INTRODUCTION In this shareholder derivative action, Plaintiffs seek to hold Alphabet, Inc., and its directors liable for breach of fiduciary duties and unjust enrichment predicated on the company’s alleged violation of the Children’s Online Privacy Protection Act (“COPPA”). 16 C.F.R. § 312. Having come up short on their initial attempt to show demand futility, Plaintiffs’ renewed effort fares no better. The essential facts remain unchanged: the Board reasonably thought YouTube was compliant with COPPA because the FTC had labeled it a general audience site, and YouTube had no actual knowledge of any violations. The FTC’s novel interpretation of the law—that individual channels within YouTube could be child-directed—does not render the board’s actions unreasonable, as they had set up…