What Ever Happened to Internet Privacy Litigation?

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By Casey C. Sullivan, Esq. on June 08, 2015 10:59 AM

Remember all those Internet privacy class action lawsuits that once made headlines? You don't hear much about them these days. The privacy class action first took off 15 years ago, booming in the late aughts. Many were often filed in the Northern District of California, home to Silicon Valley and tech companies such as Apple, Facebook, and Google. But a review by The Recorder shows that privacy litigation in N.D. Cal. has dried up faster than the state's water reserves.

Indeed, only one privacy lawsuit has been filed against the big S.V. tech companies in 2015. Where have all the lawsuits gone?

The Rise and Fall of Internet Privacy Lawsuits

The main decline in privacy lawsuits stems from the simple fact that many have not been very successful or lucrative. Very few lawsuits have ended up in payouts in the tens of millions, with a $20 million Facebook settlement being one of the standout exceptions. Even then, plaintiff's counsel was awarded less than half of the lawyers' fees requested. Many of the major privacy class actions were filed by large plaintiffs firms, who have since moved on to better money makers, such as securities litigation.

A major reason for the lack of payout is the difficulty of demonstrating harm. How exactly do you put a dollar sign on Yahoo scanning your emails or Facebook violating biometrics laws? Indeed, the Supreme Court granted cert to a case just this April which focuses on whether some privacy victims even have standing to sue, even when a tech company's actions violate relevant statutes.

Privacy Isn't the Only Issue to Litigate

Tech GCs should pack up for vacation just yet, however. While the amount of privacy class actions is crashing, there are still plenty of lawsuits facing tech companies. Recently, a spate of high profile lawsuits have accused tech companies of discriminating against women, older workers, minorities -- basically everyone but white brogrammers in their twenties. Similarly, consumer lawsuits have shifted to looking at data breaches instead of just privacy violations.

As Internet privacy lawsuits start to disappear, the strongest voices for consumer privacy protections are likely to be aimed at legislatures, rather than courts. Many of the laws underlying Internet privacy suits were passed in the 1980s and state and federal law have been slow to adapt to Internet age concerns.

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