September 17, 2021

Facebook escapes big damages in Privacy Class Action

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U.S. District Chief Judge Phyllis Hamilton, Northern District of California

U.S. District Chief Judge Phyllis Hamilton, Northern District of California

By Ross Todd, From The Recorder


SAN FRANCISCO — A federal judge in Oakland has declined to certify a damages class in a privacy lawsuit against Facebook Inc. over its alleged scanning of users’ private messages.

In an order issued Wednesday, U.S. District Judge Phyllis Hamilton wrote that many Facebook users suffered “little, if any, harm” as a result of Facebook’s message-scanning practices and that damages in the case weren’t appropriate for class treatment. Hamilton, however, certified a class seeking injunctive relief under federal and state privacy laws.

Plaintiffs lawyers led by Michael Sobol at Lieff Cabraser Heimann & Bernstein sued Facebook after The Wall Street Journal reported that when users included links to websites in their private Facebook messages, those links registered as a “Like” for sites that displayed Facebook’s “Like” button. Plaintiffs claimed that Facebook’s interception and scanning of the messages constituted a violation of the Federal Wiretap Act, as well as California’s Invasion of Privacy Act.

Hamilton rejected Facebook’s motion to dismiss the suit in December 2014, finding that the company’s link-scanning didn’t fit into an exception in the Wiretap Act for communications service providers to conduct activity within the “ordinary course of business.” But on class certification, she concluded that the case could result in an unwarranted windfall to many class members since the law carries statutory damages of up to $10,000.

“To be clear, it is not the size of an aggregate damages award that the court finds disproportionate,” Hamilton wrote. “Rather, it is the fact that many individual damages awards would be disproportionate, and sorting out those disproportionate damages awards would require individualized analyses that would predominate over common ones,” she wrote.

Sobol and Gibson, Dunn & Crutcher’s Christopher Chorba, who argued the class certification motion for Facebook, didn’t immediately respond to messages Thursday.

In an email, a Facebook spokesperson applauded Hamilton’s decision not to allow plaintiffs to seek damages on a classwide basis. “The remaining claims relate to historical practices that are entirely lawful, and we look forward to resolving those claims on the merits,” the spokesperson said.

IMAGE: U.S. District Chief Judge Phyllis Hamilton, Northern District of California Jason Doiy / The Recorder

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