This alert summarizes several new areas of litigation that online retailers who market to consumers in Washington and California, and/or whose websites are accessible to consumers in these two states, should understand and carefully monitor.
The lawsuits at issue arise under Washington’s Commercial Electronic Mail Act, California’s Anti-Spam Law, California’s Invasion of Privacy Act, and California’s False Advertising Law and Consumer Legal Remedies Act.
The following summarizes the basis for these claims and suggests a few measures to help retailers mitigate their exposure.
Uptick in Washington CEMA Litigation
Overview
Originally enacted in 1998, when “[i]nternet access was comparatively slow and expensive,”[1] Washington’s Commercial Electronic Mail Act (“CEMA”),[2] among other things, prohibits individuals and entities from transmitting emails to Washington residents containing “false or misleading information in the subject line.”[3] An individual who receives an email that violates CEMA is entitled to $500 in statutory damages or their actual damages, whichever amount is greater.[4] Additionally, a violation of CEMA is a per se violation of the Washington Consumer Protection Act, which authorizes treble damages for CEMA infractions.[5]
Until recently, CEMA claims were seldom brought because courts construed its prohibition to apply only to “false or misleading” email subject lines that obscured the email’s commercial nature.[6] In other words, CEMA penalized subject lines that masked the fact that the email was an advertisement.[7]
In April 2025, the Washington Supreme Court broadened CEMA’s reach by construing the statute to prohibit “any false or misleading information in the subject line of a commercial e-mail,” including misrepresentations regarding “the duration or availability of a promotion, its terms and nature, the cost of goods, and other facts Washington residents would depend on in making their consumer decisions.”[8]
Since April 2025, CEMA litigation has surged, with over sixty class actions currently pending in the United States District Court for the Western District of Washington alone. Most of these lawsuits allege that online retailers violated CEMA by sending emails with subject lines that make “false time scarcity” claims. Specifically, plaintiffs allege that emails advertising limited time promotions with subject lines like “Sale ends tonight” or “Only a few hours left” are false or misleading when the sale or promotion is later extended.
Retailers’ arguments for dismissal at the pleadings stage have not had much success. Retailers have sought dismissal of these putative class actions by arguing that CEMA is preempted by the federal Controlling the Assault of Non-Solicited Pornography Marketing Act, CEMA violates the dormant Commerce Clause, and plaintiffs have failed to plead fraudulent or deceptive conduct with particularity. So far, courts have been reluctant to dismiss on any of these grounds.[9]
Recent Amendment to CEMA
The uptick in CEMA cases caught the attention of the Washington Legislature, which passed an amendment to CEMA via House Bill 2274 in March.[10] The bill narrows CEMA by only prohibiting emails that use “a subject line which, based on the person’s actual knowledge or knowledge fairly implied on the basis of objective circumstances, contains false or misleading information in the subject line.”[11] The bill also reduces statutory damages from $500 to $100.[12] Proponents of the bill argued the revisions were “a temporary step” designed to “protect small retailers from inadvertently violating CEMA.”[13] House Bill 2274 was signed by Governor Bob Ferguson on March 23,[14] and is set to take effect on June 11, 2026.[15] The amendment “applies to all causes of action commenced on or after the effective date of [the amendment], regardless of when the cause of action arose.”[16]
Measures to Mitigate Exposure
Until the amendment to CEMA takes effect, online retailers employing promotional email campaigns in Washington should consider the following:
- Revise and Audit Promotional Subject Lines. Carefully review statements about sales timing, availability, or exclusivity, and in particular scrutinize extended promotions.
- Document Promotional Timelines. Maintain records supporting representations made in email subject lines regarding the duration of a promotion or the decision to extend a promotion, including consumer reaction data.
- Screen Washington Residents from Email Campaigns. Online retailers may consider applying heightened compliance protocols for campaigns reaching Washington residents, including screening those residents from certain promotional email campaigns.
California’s CEMA Equivalent
Following Washington plaintiffs’ example, California plaintiffs are asserting similar complaints under California’s “Anti-Spam Law.”[17]
The Anti-Spam Law, while narrower than CEMA, is similarly designed to protect California consumers from deceptive and unwanted email advertising. It prohibits retailers from issuing unsolicited email advertisements (including automated emailing), collecting email addresses for purposes of unsolicited email advertising, using the domain name or email header of a third-party company to mislead a consumer as to the origin of a commercial email, and using an email subject line to knowingly mislead a consumer about the contents or subject matter of an email.[18]
Unlike CEMA, the Anti-Spam Law’s plain language does not prohibit emails where a subject line and email contents are generally consistent but contain errors or omissions (e.g., a subject line advertising a sale is in its “final hours” and the body of the email advertising the sale will last for a few additional days, or where the extent of a website’s sale may be inaccurately stated in the email). The Anti-Spam Law is concerned about misrepresentations of who is sending the email and what is represented by the subject line to be contained in the email.[19] However, several courts in California have seemingly endorsed a broader interpretation of the Anti-Spam Law’s prohibitions in the past, and plaintiffs’ lawyers are now citing these older decisions to advance their claims.[20]
Retailers advertising to California consumers should ensure that their subject line and email contents are consistent with one another and are only issued to consumers who expressed assent to receiving promotional material.
Revival of CIPA
Overview
Online retailers should also be reviewing their use of common website tracking tools in light of the recent surge in claims under the California Invasion of Privacy Act (“CIPA”).[21]
CIPA was originally enacted in 1967 to combat “the development of new devices and techniques for the purpose of eavesdropping upon private communications” and to protect “the right of privacy of the people of [California].”[22] CIPA, among other things, prohibits the use of a “pen register” or a “trap and trace device” without a court order.[23]
CIPA defines a “pen register” as “a device or process that records or decodes dialing, routing, addressing, or signaling information transmitted by an instrument or facility from which a wire or electronic communication is transmitted, but not the contents of the communication.”[24]
A “trap and trace device” is defined as “a device or process that captures the incoming electronic or other impulses that identify the originating number or other dialing, routing, addressing, or signaling information reasonably likely to identify the source of a wire or electronic communication, but not the contents of a communication.”[25]
CIPA creates a private right of action allowing individuals to recover the greater of $5,000 per violation or “[t]hree times the amount of actual damages, if any, sustained by the plaintiff.”[26]
Plaintiffs are utilizing CIPA’s private right of action to bring lawsuits arguing that commonplace website tracking tools, such as web beacons and pixels, are unlawful pen registers or trap and trace devices.
So far, litigation outcomes have drastically varied. Many courts have denied motions to dismiss CIPA claims, holding that website tracking technologies, such as pixels, meet the statutory definitions of a pen register or a trap and trace device[27] and that collecting certain types of personal information from website visitors creates concrete injury sufficient to confer Article III standing in federal courts.[28]
Other courts have dismissed CIPA claims on standing grounds, finding that a violation of CIPA, without a showing that the plaintiff was concretely harmed by the violation, is insufficient to establish Article III standing.[29]
Measures to Mitigate Exposure
- Audit Website Tracking Technologies. Online retailers should understand what specific tracking tools their websites are using and determine which of these tools are necessary to the business, and consider removing those that are not.
- Implement Clear and Unambiguous Opt-in Mechanisms. Online retailers may consider utilizing pop-up banners that clearly inform website visitors of tracking technologies that are installed and offer those visitors an opportunity to opt-in or opt-out.
- Monitor Ongoing Litigation. Until the California appellate courts decide whether website tracking technologies come within CIPA’s statutory definitions of pen registers or trap and trace devices, courts will continue to render inconsistent outcomes. Online retailers should monitor ongoing CIPA litigation trends until this issue is resolved.
Uptick in Phantom Discount Claims
Overview
California’s False Advertising Law (“FAL”)[30] prohibits retailers from making advertisements deemed false or misleading to reasonable consumers. One form of FAL claim relies on so-called “phantom discounts.” A “phantom discount” is generally alleged where a retailer advertises a discounted price next to an inflated “former price” at which the product was never sold (or at least not for a period exceeding three months prior to publication of the advertisement).[31] Plaintiffs allege that retailers use deceptive phantom discounts to fabricate a discount or make a discount appear more significant.
California’s FAL prohibits retailers from publishing advertisements purporting to display the former price of a product unless that former price was in fact the “prevailing market price” for the product within the three months preceding publication of the advertisement (subject to an exception where the advertisement explicitly specifies when the former price last prevailed).[32] This rule is meant to ensure that advertised discounts represent real price reductions.
In practice, phantom discounts claims often target strike-through pricing, where a product’s original price is struck-through next to a lower sale price (“$100 / $ 80”). However, courts have also applied the law to phrases implying a prior higher price, such as “formerly,” “regularly,” “originally,” “reduced from,” “was/now,” or “% off.”[33]
Courts have been generally hesitant to dismiss phantom discount claims early in litigation, leading many cases to settle early even when claims are facially weak.[34]
Measures to Mitigate Exposure
- Retailers should maintain accurate records showing the dates of publication of their discounts and must ensure that no discounted item remains discounted for more than three months without returning to the former “prevailing market price.”
- Retailers should also clearly explain the basis for their discounts, especially when those discounts are tied to bundles, bulk purchases, or other non-time-related conditions.
- Similar to the CEMA and CIPA claims discussed above, retailers should continue to monitor litigation trends for new guidance and authority on this topic.
Claims Under California’s New Drip Pricing Law
Overview
Another alleged practice often raised in California complaints is “drip pricing.” Effective July 1, 2024, California’s CLRA was amended to include the “Honest Pricing Law,” a provision explicitly prohibiting retailers from “[a]dvertising, displaying, or offering a price for a good or service that does not include all mandatory fees or charges” (other than taxes or fees imposed by a government on the transaction and shipping costs reasonably and actually incurred to ship the physical good to the consumer).[35] Like other CLRA provisions, this section applies only to consumer purchases.
California’s drip pricing law does not prohibit added fees, nor does it tell retailers what types of fees they may charge to consumers. It requires only that any fees retailers add to a consumer’s transaction for a service or good be incorporated in the retailer’s full advertised price.
While the statute is relatively new, some examples of drip-pricing claims predate the statute’s effective date, and were often brought under California’s companion FAL and Unfair Competition Law (“UCL”). Examples of claims targeting drip pricing include hotels advertising room rates but including resort or destination fees later in the booking process[36] and online retailers including a “processing fee” after consumers input shipping and credit card information.[37]
Measures to Mitigate Exposure
Retailers selling goods or services to California consumers should review their advertised prices and determine whether they include all mandatory charges and fees.
Online Retailers Should Continue to Consider Incorporating Arbitration Provisions with Class-Action Waivers into Their Websites’ Terms of Service
If pursuing this option, retailers should be aware that California has specific requirements for a website’s terms of service to effectively bind a claimant to arbitration. While California courts generally enforce so-called “clickwrap,” “scrollwrap,” and “sign-in” wrap agreements, they are less inclined to enforce “browsewrap” agreements.[38] Courts have made this distinction based on the level of affirmative acknowledgment required from the website user to the terms of service before using the website.
Browsewrap agreements, as opposed to clickwrap agreements (where users accept a website’s terms of use by clicking an “I agree” or “I accept” button, with a link to the agreement readily available), scrollwrap agreements (where users are presented with the entire agreement and must physically scroll to the bottom of it to find the “I agree” or “I accept” button), and sign-in wrap agreements (where users sign up to use an internet product or service and the sign-up screen states that acceptance of a separate agreement is required before the user can access the service), do not require affirmative assent to the terms of service before continued use of the website.
Courts have sometimes refused to enforce browsewrap agreements where the proponent of arbitration did not sufficiently show that the website user had actual knowledge or inquiry notice of the website terms of service—and thus of the arbitration clause.[39] Retailers can increase their odds of successfully compelling arbitration by creating and maintaining detailed records of website visitors’ assent.
[1] Certification from United States Dist. Ct. for W. Dist. of Washington in Brown v. Old Navy, LLC, 4 Wash.3d 580, 584,567 P.3d 38 (2025).
[2] Revised Code of Washington (“RCW”) 19.190.010, et seq.
[3] RCW 19.190.020(1)(b).
[4] RCW 19.190.040(1).
[5] See RCW 19.190.100; 19.86.090.
[6] See, e.g., Chen v. Sur La Table, Inc., 655 F.Supp.3d 1082, 1092 (W.D. Wash. 2023).
[7] See id.; see also State v. Heckel, 122 Wash.App. 60, 71, 93 P.3d 189 (2004) (noting that email subject lines “Did I get the right e-mail address?” and “For your review—HANDS OFF!” violated CEMA’s prohibition on false or misleading email subject lines where the body of those emails contained an unsolicited advertisement).
[8] Brown v. Old Navy, LLC, 4 Wash.3d at 583, 596.
[9] At least three judges in the Western District of Washington have denied motions to dismiss raising these arguments. See, e.g., Harrington v. Vineyard Vines, LLC, — F.Supp.3d —, 2025 WL 3677479 (W.D. Wash. 2025) (Zilly, S.J.); Ma v. Nike, Inc., — F.Supp.3d —, 2026 WL 100731 (W.D. Wash. 2026) (Robart, J.); Kempf v. Fullbeauty Brands Operations, LLC, No. C25-1141 TSZ, 2026 WL 395677 (W.D. Wash. Feb. 12, 2026) (Zilly, S.J.); Shahpur v. Ulta Salon, Cosmetics & Fragrance, Inc., No. 2:25-cv-00284-RLP, 2026 WL 571122 (W.D. Wash. Feb. 27, 2026) (Pennell, J.).
[10] See Engrossed Substitute House Bill 2274 (Wash. 2026), https://lawfilesext.leg.wa.gov/biennium/2025-26/Pdf/Bills/House%20Passed%20Legislature/2274-S.PL.pdf#page=1.
[11] See id.
[12] See id.
[13] Senate Bill Report on Engrossed House Substitute Bill 2274, at 3 (Wash. 2026), https://lawfilesext.leg.wa.gov/biennium/2025-26/Pdf/Bill%20Reports/Senate/2274-S.E%20SBR%20APS%2026.pdf?q=20260318150045.
[14] See Bill Action Taken, Washington Governor Bob Ferguson, https://governor.wa.gov/official-actions/bill-actions?year=1&chamber=All&governors_action=All&combine=2274&items_per_page=25&order=field_date_time&sort=asc (last visited March 23, 2026).
[15] See Wash. Laws of 2026, ch. 135..
[16] See id.
[17] California Business and Professions Code § 17529, et seq.
[18] Cal. Bus. & Prof. Code §§ 17529.2, 17529.4, 17529.5.
[19] See, e.g., Rosolowski v. Guthy-Renker LLC (2014) 230 Cal.App.4th 1403, 1417-18; see also Chin v. Evergreen Freedom Found., 764 F.Supp.3d 924, 933 (C.D. Cal. 2025); Hypertouch Inc. v. ValueClick Inc., et al., (2011) 192 Cal.App.4th 805, 838.
[20] See, e.g., Hypertouch, Inc., 192 Cal.App.4th at 838 (noting that a subject line creating “the impression that the content of the e-mail will allow the recipient to obtain a free gift by doing one act (such as opening the e-mail or participating in a single survey)” violates the Anti-Spam Law where “the content of the e-mail reveal[s] that the ‘gift’ can only be obtained by undertaking more onerous tasks (such as paying money for the gift or agreeing to partake in other offers)”); Asis Internet Servs. v. Subscriberbase Inc., No. 09-3503 SC, 2010 WL 1267763, at *5 (N.D. Cal. Apr. 1, 2010) (noting that “it is inappropriate to suggest that a subject line is not deceptive because of corrective disclaimers in the fine print of the [email] message itself”).
[21] Cal. Penal Code § 630, et seq.
[22] Cal. Penal Code § 630.
[23] Cal. Penal Code § 638.51(a).
[24] Cal. Penal Code § 638.50(b).
[25] Cal. Penal Code § 638.50(c).
[26] Cal. Penal Code § 637.2(a).
[27] See Nelson v. Reddit, Inc., No. 25-CV-1470 JLS (AHG), 2026 WL 445627, at *4 (S.D. Cal. Feb. 17, 2026) (collecting cases); Maketa v. Valnet Inc., No. 25-cv-05517-RS, 2026 WL 323126, at *1 (N.D. Cal. Feb. 6, 2026) (collecting cases).
[28] See, e.g., Shah v. Fandom, Inc., 754 F.Supp.3d 924, 929 (N.D. Cal. 2024); Harris v. iHeartMedia, Inc., No. 25-cv-06038-EKL, 2026 WL 247875, at *3 (N.D. Cal. Jan. 29, 2026) (collecting cases).
[29] See, e.g., Maghoney v. Dotdash Meredith, Inc., No. 24-cv-2394-AJB-BJW, 2026 WL 497402, at *4-7 (S.D. Cal. Feb. 23, 2026); Mitchener v. CuriosityStream, Inc., — F.Supp.3d —, 2025 WL 2272413, at *3-5 (N.D. Cal. 2025).
[30] Cal. Bus. & Prof. Code § 17500, et seq.
[31] Cal. Bus. & Prof. Code § 17501.
[32] See id.
[33] Hansen v. Newegg.com Americas, Inc. (2018) 25 Cal.App.5th 714, 723. Notably, the FAL’s “prevailing market price” standard differs from the Federal Trade Commission’s (“FTC”) regulations on deceptive pricing. The FTC’s regulations compare a discount against the retailer’s “own former price,” see 16 C.F.R. § 233.1(a), whereas the FAL’s “prevailing market price” is “determined by the actual sales prices of similar goods, or the same good, on the ‘open local market.’” See People v. Superior Ct. (J.C. Penney Corp.) (2019) 34 Cal.App.5th 376, 412.
[34] See, e.g., Jacobs v. La-Z-Boy Inc., No. 2:24-cv-04446-JLS-AS, 2024 WL 5194976, at *5 (C.D. Cal. Nov. 14, 2024); Phillips v. Brooklyn Bedding LLC, No. 23-cv-03781-RFL, 2024 WL 2830663, at *4 (N.D. Cal. Mar. 28, 2024).
[35] Cal. Civil Code § 1770(a)(29).
[36] Hall v. Marriott International, Inc., Docket No. 3:19-cv-01715 (S.D. Cal. Sept. 09, 2019).
[37] Mansfield v. StockX LLC, Docket No. 3:25-cv-04250 (N.D. Cal. May 16, 2025).
[38] B.D. v. Blizzard Ent., Inc. (2022) 76 Cal.App.5th 931, 945-46.
[39] Weeks v. Interactive Life Forms, LLC (2024) 100 Cal.App.5th 1077, 1085-87.
