Appeals court rules Shopify can be sued in California for installing tracking software on devices
A US federal appeals court has revived a proposed data privacy class action against Shopify, ruling that the Canadian e-commerce company can be sued in California for collecting personal data from state residents.
Reuters reported that the 9th US Circuit Court of Appeals ruled 10-1 that Shopify “expressly aimed” its conduct at California, allowing the case to move forward despite earlier dismissals.
California resident Brandon Briskin brought the lawsuit, alleging that Shopify installed tracking software—specifically cookies—on his iPhone without consent when he purchased athletic wear from the California-based retailer I Am Becoming.
Briskin claimed the Ottawa-headquartered company used his personal information to build a profile that could then be sold to third-party merchants.
While Shopify argued that it should not be tried in California—citing nationwide operations and claiming it did not direct actions at the state—the full 9th Circuit disagreed.
Circuit Judge Kim McLane Wardlaw, writing for the majority, said, “Shopify deliberately reached out ... by knowingly installing tracking software onto unsuspecting Californians’ phones so that it could later sell the data it obtained, in a manner that was neither random, isolated, or fortuitous.”
The decision overturns prior rulings from a lower court and a three-judge panel that had dismissed the case.
A Shopify spokesperson called the ruling an attack on “the basics of how the internet works,” arguing that it could force small business owners into legal battles far from where they operate.
The company has not disclosed its next legal steps.
Matt McCrary, counsel for Briskin, welcomed the ruling, saying it rejected the argument that “a company is jurisdictionally 'nowhere' because it does business 'everywhere.'”
A coalition of 30 states and Washington, D.C., supported Briskin’s position, stating that local governments must retain the authority to enforce their own consumer protection laws on companies engaging in internet-based commerce within their borders.
The US Chamber of Commerce backed Shopify, warning that broad jurisdiction could harm software providers with global reach.
Dissenting from the majority, Circuit Judge Consuelo Callahan criticised what she termed the “traveling cookie rule,” arguing that the court had “impermissibly manufacture[d] jurisdiction wherever the plaintiff goes.”
The case is Briskin v. Shopify, Inc. et al, 9th US Circuit Court of Appeals, No. 22-15815. The 9th Circuit includes nine western US states, Guam, and the Northern Mariana Islands.
The ruling comes at a time when Shopify’s stock has seen substantial losses. Once considered a darling among Canadian investors, Shopify’s share price has dropped significantly since peaking in late 2021.
The company reached an all-time high closing price of US$169.06 on November 19, 2021. As of April 21, the stock was trading at US$81.51.
Over the past year, it has fluctuated between a low of US$48.56 and a high of US$129.38.
In 2024 alone, according to StockScan, Shopify’s share price fell more than 74 percent, closing the year at US$34.71 after starting at US$136.35.
Analysts have linked the sharp decline to a combination of global market pressures, slowing growth, and investor concerns over regulatory scrutiny, as per Markets.com.
Shopify is scheduled to release its Q1 2025 financial results on May 8.
