TIME FOR ROUND TWO: Vivek Shah Throws A Light Jab But Lofty Counters With A Big Uppercut

Hi TCPAWorld!

Anyone who runs a business and has ever opened their email inbox to find a “notice of CIPA violation” letter sitting there next to a complaint that seems to have been polished and reused, grab a chair because things are getting exciting.

Back in July, I wrote an article about how instead of sitting around and waiting to get sued over a run of the mill website analytics tool, Lofty did what other companies will hopefully do in the future: it beat Vivek to the punch and filed its own action against him in the Central District of California.

Recall that Vivek Shah has sent at least hundreds of nearly identical demand letters to companies all over the country including Lofty and claimed that its website ran Google Analytics 4 and HubSpot in a way that violates California’s pen register statute. A lot of companies generally would make a payment to Shah to make the headache go away but Lofty decided that enough was enough and pretty much said “go ahead and sue, we’ll see you in court, we’ll even accept service so you don’t have to chase us around with a process server.” Well not only did Lofty accept service, it flipped the script entirely and sued Shah first asking a federal judge to declare its website lawful, and furthermore to declare that Shah does not have standing to bring a claim like this to begin with.

See the links below for both the Czar’s and my articles discussing Lofty’s initial filing.

LOFTY: Vivek Shah Served a CIPA Demand Letter on Lofty, Inc.– They Sued Him For It

Lofty Inc. is my kind of company. Here’s a company that knows how to push back against extortionist nonsense. Vivek Shah has been serving hundreds of demand letters under California’s CIPA. To all eyes the claims are basically bogus– barely colorable claims designed to extract a quick settlement from companies will to shell out a … Continue reading
TCPAWorld

LET’S GET READY TO RUMBLE: Lofty Flips the Script On Vivek Shah

Hi CIPAWorld: A potentially consequential CIPA case has landed in the Central District of California. The lawsuit, filed against frequent CIPA plaintiff Vivek Shah, challenges some of the core legal theories behind the recent wave of website privacy lawsuits and could have implications well beyond the parties involved. See Lofty, Inc. v. Vivek Shah, 2:26-cv-07425 … Continue reading
CIPAWorld

Now, let’s proceed to where things are heating up because the motion to dismiss briefing just finished and to no one’s surprise, Lofty came prepared.

Shah, representing himself, fired back against Lofty’s declaratory judgment action by bringing a motion to dismiss that centered around three main arguments. The first argument was centered around the wallet, and I mean this almost literally because federal court needs more than $75,000 in controversy to even hear this case and Shah argued that his own letter priced his claim at exactly $10,000. Second, he argued that there is no real case yet because nothing was ever filed and the draft of the complaint was simply sitting and tucked away and asking the court to decide whether he has standing to sue over a lawsuit that doesn’t technically exists felt like asking the referee to score a boxing fight where only one person showed up to the ring.

The third argument that Shah presented was the one he leaned heavily on which is why it gets its own paragraph here. Shah asked the court to exercise its discretion and pass on the whole action and leaned on the standard that was created in Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491 (1942) and reaffirmed in Wilton v. Seven Falls Co., 515 U.S. 277 (1995) that held that a federal court has discretion to decline to exercise jurisdiction over a declaratory judgment action where parallel state proceedings provide a more appropriate forum for resolving the controversy. Shah was attempting to point out that the district court should pass on this matter given that the California Legislature is currently in the middle of rewriting the statute that this case revolves around.

To make this argument more effective, Shah leaned on Drexel Chemical Co. v. Vivek Shah, No. CH-26-0122 (Chancery Court of Shelby County, Tenn., Part II) and wanted the court here to treat a case of his own from Tennessee as a knock-out punch. To provide more context about Drexel, a different company that had gotten one of Shah’s demand letters tried the exact same move Lofty is trying now where instead of waiting to get sued, it went to Tennessee Chancery Court first and asked for a declaration that Shah lacked standing and that his draft complaint would be thrown out if filed in court. The Chancery Court dismissed the case, holding that a complaint nobody has actually filed isn’t a real “existing controversy” under Tennessee’s rules, and that asking a court to rule on something that is sitting in one’s draft folder is identical to requesting an advisory opinion, which courts generally don’t do. Separately, the court in Drexel noted that Tennessee law looks unfavorably on these kinds of reverse declaratory actions where a soon to be defendant files an action first. For Shah, his pitch to the court here was pretty much that this was tried on him before and failed and so the judge should do the same here against Lofty.

To Lofty’s credit, they were prepared but the most fascinating thing about its opposition to Shah’s motion to dismiss was that its argument was quite simply that “Tennessee law does not apply here.” Lofty noted that Drexel was decided under Tennessee’s own justiciability rules as opposed to Article III and even if Tennessee’s rules “roughly tracks” federal rules, roughly tracking isn’t a justification for a whole amount of binding Ninth Circuit law to be thrown out because a state court in Memphis felt differently. Furthermore, Lofty noted that in the Ninth Circuit, a “reasonable apprehension” of getting sued, which is a noticeably lower bar than an actual filed lawsuit, is more than enough to create a real live dispute, especially when the person making the threat has a documented habit of actually filing these things and literally mailed over a complaint marked ready to go (and Shah has a long documented history of doing this sort of thing).

As I discussed in a previous article (see below), Shah has already been declared a vexatious litigant in a completely separate case in this very same courthouse, Shah v. Crain Communications, Inc., No. 2:26-cv-03070 (C.D. Cal. July 20, 2026), for a pattern of filing CIPA suits and then bailing on them at the pleading stage.

JUSTICE IS SERVED: Vivek Shah Declared a Vexatious Litigant!

Hi TCPAWorld! Twenty-nine lawsuits in under five years. Seven nearly identical complaints in seven months. And almost none of them ever saw the inside of a courtroom before the plaintiff himself pulled the plug. That’s the résumé a federal judge in Los Angeles was staring at when he decided one man had officially worn out … Continue reading
TCPPAWorld

But even the vexatious litigant component aside, Drexel is one out-of-state trial court order applying a different state’s rules to a slightly different situation. It may cause a scratch, but its far from a knockout blow (or in legalese, a “precedent” killer) that Shah was hoping for.

Additionally, Lofty’s opposition countered Shah’s amount in controversy argument by providing a declaration by its own Chief Financial Officer where it walked through exactly what it would cost Lofty to comply if it lost this case. The calculation totaled somewhere around $160,000 for a bare bones removal of Google Analytics 4, or up to $642,420 if Lofty had to build a full replacement system and with more than 30,000 deployments serving over 91,000 real customers, that math tracks. Furthermore, Loft made a persuasive point in noting that it isn’t trying to get some sweeping ruling for the entire internet, just a declaration protecting its own platform and its own customers, which is exactly the kind of concrete, personal stake Article III standing is supposed to reward.

Shah pushed back in his reply to the opposition noting that the number the CFO provided in his declaration was a much bigger fix than Shah’s letter ever actually asked for. To Shah’s credit, that is a fair point but if looking at the totality of the circumstances, Shah’s $10,000 demand doesn’t consider the big infrastructure required to handle tens of thousands of small business customers. And as noted before, when Shah came demanding money, instead of yielding to him, Lofty put its own money, its own executives, and its own choice of courtroom on the line to actually get an answer. That is exactly the kind of pushback the whole CIPA demand letter economy could use more of and regardless of what gets exactly sorted out in regard to the specific numbers, Lofty is fighting the good fight here. This case will hopefully entice other companies to follow in similar suit if they get a similar CIPA demand.

Mark your calendars for September 4, 2026, as that is the date this all gets argued in front of Judge Andre Birotte Jr. in Courtroom 7B. We will be glued to the docket and will let you know as soon as a ruling happens.

Stay tuned TCPAWorld and as always, be safe.