Justices Decline to Halt $35B Privacy Class Action Against Facebook

SAN FRANCISCO (CN) – The Supreme Court on Tuesday denied Facebook’s last-ditch effort to derail a $35 billion class action claiming the company harvested millions of users’ facial data without consent.

(AP Photo/Thibault Camus, File)

The Supreme Court’s denial means a trial initially scheduled to start in July 2018 will soon be placed back on the calendar. The trial was postponed pending appeal in May 2018.

“For many corporate defendants, justice delayed is justice,” class attorney Paul Gellar, of Robbins Geller Rudman & Dowd, said in an emailed statement. “We are pleased to have cleared yet another hurdle and intend to proceed with alacrity in this important case at the intersection of technology and privacy.”

Lead plaintiff Nimesh Patel sued Facebook in 2015 in one of three consolidated class actions, claiming the social network started mapping users’ faces for its “Photo Tag Suggest” function in 2011. They say Facebook did so without their permission and failed to inform them how long their data would be stored as required by the Illinois Biometric Privacy Act of 2008.

Facebook had argued users lack standing to sue because they suffered no “concrete harm,” such as a loss of money, as a result of the alleged violation.

In August 2019, a three-judge Ninth Circuit panel rejected those arguments, finding the loss of control over one’s private information is a real-world injury. Writing for the panel, U.S. Circuit Judge Sandra Ikuta, a George W. Bush appointee, wrote that “a concrete injury need not be tangible.”

The San Francisco-based appeals court later rejected Facebook’s request for an en banc rehearing.

In December, Facebook filed a petition for review with U.S. Supreme Court, arguing the Ninth Circuit’s decision created a circuit split on two critical issues, for which guidance from the nation’s highest court was needed.

Facebook said the Ninth Circuit’s opinion differed from rulings issued by the Second, Fourth, Sixth, Seventh, and Eighth Circuits, which held plaintiffs must not only show a law protects a “concrete interest” but also that violation of the law harmed the plaintiff “in a personal and individual way.”

Additionally, Facebook argued the Ninth Circuit wrongly held plaintiffs could sue based on the risk of future misuse of their private information. According to Facebook, the First, Third, Fourth and D.C. Circuits have held the possibility that one’s personal information may be misused does not create standing unless there is “an imminent risk of injury.”

Facebook further agued the Ninth Circuit failed to decide a critical issue for class certification – whether the alleged the violation occurred when out-of-state Facebook servers scanned users’ faces or when users uploaded their photos in Illinois.

The social media giant maintains that because facial data was scanned and stored on servers outside the state, it cannot be sued for violating Illinois law.

Facebook’s petition for review was one of 68 the Supreme Court denied in an order list filed Tuesday. The Supreme Court gave no reasons for the denial.

The case will now go back to U.S. District Judge James Donato’s court in San Francisco. Before the case was stayed pending appeal, the judge had ordered Facebook to alert millions of users about the lawsuit through emails, newsfeed posts, and “jewel” notifications, or Facebook alerts.

Facebook could be liable for $1,000 for each negligent violation and $5,000 for each knowing violation of the Illinois law. With a class of potentially 7 million Facebook users, damages could exceed $35 billion.

The Menlo Park-based tech giant had argued that users should not be allowed to bring a class action that could make it liable for an absurd amount of damages. The Ninth Circuit rejected that argument last year, finding no indication that the Illinois Legislature “intended to place a cap on statutory damages.”

A Facebook spokesperson declined to comment.

Facebook lawyers Lauren Goldman of Mayer Brown and Michael Graham Rhodes of Cooley LLP, did not immediately return emails requesting comment Tuesday morning.

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