NEW YORK ( TheStreet) -- In the latest installment of companies playing Big Brother, Yahoo!  ( YHOO) is facing allegations it scanned Yahoo! Mail emails to glean data for targeted advertising, a practice in violation of users’ rights to privacy.

The plaintiffs, residents of San Bruno, Calif., who are lobbying for class-action status, argue that Yahoo! shared the content of emails sent between Yahoo! Mail accounts and external email servers with third parties for the purposes of data collection and targeted advertising.

In the U.S. District Court, Northern District of California (San Jose), District Judge Lucy Koh ruled plaintiffs can move forward with the claims against Yahoo!.

However, in a mixed ruling, the court dismissed claims its terms of service fail to adequately notify that its Yahoo! Mail correspondence might be used to build advertising profiles of its users.

Not without a certain level of hypocrisy, only last week Yahoo! announced plans to create a more secure email service through end-to-end encryption, a means of scrambling data so it is unreadable to hackers.

--Written by Keris Alison Lahiff in New York.

If you liked this article you might like

Mellanox Must Hike 2018 Targets or Face Activist Escalation, M&A

Mellanox Must Hike 2018 Targets or Face Activist Escalation, M&A

Amazon's Taxes, Yahoo! Breach, PepsiCo Earnings: Wednesday's Top Stories

Amazon's Taxes, Yahoo! Breach, PepsiCo Earnings: Wednesday's Top Stories

Equifax Breach Reveals Frightening Truth: Companies Can Delay Disclosing Hacks

Equifax Breach Reveals Frightening Truth: Companies Can Delay Disclosing Hacks

How Alibaba's 'Genie' Smart Speaker Can Overcome the Amazon Echo's 3-Year Head Start and Still Win

How Alibaba's 'Genie' Smart Speaker Can Overcome the Amazon Echo's 3-Year Head Start and Still Win

Facebook, Apple, Netflix and Google Have Caught the Flu -- Here's How Not to Get Killed By It

Facebook, Apple, Netflix and Google Have Caught the Flu -- Here's How Not to Get Killed By It