Akin Gump Lawyers Pen Article for Bloomberg BNA on SCOTUS Privacy Class Action Case
Bloomberg BNA has published the article “In Potentially Significant Case, Supreme Court to Test Limits of Privacy and Data Breach Class Actions Seeking Statutory Damages,” written by Akin Gump Supreme Court and appellate practice counsel James Tysse and co-head Pratik Shah, cybersecurity initiative co-head Natasha Kohne and litigation partner Michelle Reed, on Spokeo v. Robins and the potential impact of the Supreme Court’s ruling on future suits involving such matters as data breaches and privacy violations.
Spokeo concerns a man who sued Spokeo Inc., which operates a “people search engine,” for having allegedly published false information about him, such as his age, wealth and employment status. He alleged willful violation of the Fair Credit Reporting Act, which governs use and confidentiality of consumer data, and, claiming that Spokeo harmed his job prospects, demanded statutory damages for himself and the putative class of millions that would put the defendant’s potential liability in the billions.
Among the topics covered, the authors discussed:
The Constitutional Standing Requirement: “At issue in Spokeo is whether Congress can lawfully confer constitutional standing on a plaintiff for the violation of a federal statute in the absence of concrete harm, i.e., for only ‘statutory’’ injury… Spokeo asks whether the violation of a plaintiff’s statutory rights (such as the statutory right to the confidentiality of one’s own consumer data) can suffice to establish an injury-in-fact entitling the plaintiff to sue—even absent any allegation of additional harm.”
The case’s significance: “As Spokeo and its amici told the Court, large companies are increasingly forced to defend against class action lawsuits demanding statutory damages for technical violations of a host of federal laws regulating virtually every major consumer-facing industry… And because these laws often provide statutory damages of $1,000 or more per violation, some defendants may face massive liability for technical violations of federal law that result in no real harm.”
Worth noting for frequent class action targets: “[A] Supreme Court decision requiring a showing of concrete and individualized harm as a predicate for obtaining statutory damages would prove to be a potent defense against costly statutory-injury class actions, and even discourage some plaintiffs from bringing suit altogether.”
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