How easy should it be for consumers to sue companies that violate laws about data protection? Today's case could have far-reaching effects.
On Monday, the U.S. Supreme Court will hear Spokeo v. Robins, a case about a data-broker that published inaccurate information about a man’s personal and professional life. The case is important because it will affect how and when people can sue companies that violate various laws about data and consumer protection.
Here’s a plain English guide to the case, why it matters and where to learn more.
What is the lawsuit about in the first place?
Spokeo is an online “people search engine” that sells information about individuals based on publicly available data. A Virginia man, Thomas Robins, discovered that Spokeo misstated information about his age, marital status, education and professional experience.
Robins sued Spokeo under the Fair Credit Reporting Act, which lets consumers claim damages from $100 to $1000 if a company publishes a false report about them. Robins wants to represent others in the same situation through a class action suit, meaning Spokeo could have to pay millions if the Supreme Court upholds a lower court ruling in his favor.
Why did the case reach the Supreme Court?
It’s all about whether Robins was actually harmed when Spokeo published the inaccurate information. Spokeo says he should have to show some sort of injury, while Robins says it’s enough to show the company broke the fair credit law.
In legal terms, it’s about whether Robins has standing under the Constitution, which requires there to be a “case” before federal courts can take action.
Why is the case such a big deal?
If Robins can’t rely on the penalties set out in the law, it will be harder for consumers to show damages and stop companies from getting these sort of cases thrown out of court. And, it’s not just the Fair Credit Reporting Act at stake. There are many other laws—including ones about robocalling, housing or fair lending—that provide similar “statutory rights” to sue.
Companies argue these laws are abused by class action lawyers, who seize on small technical violations to force them into multi-million dollar settlements. That’s why Google GOOGL , Facebook FB , Netflix and other Silicon Valley firms, along with the U.S. Chamber of Commerce, are lining up behind Spokeo in the case.
On the other side, consumer advocates claim that the sort of penalties set out in the fair credit law are the only way people can stand up to companies that misuse data or engage in abusive practices. Also, at a time when firms are harvesting an ever-growing pile of consumer data, a ruling against Spokeo would be seen as a victory for privacy advocates.
How will the Supreme Court rule?
It doesn’t look promising for Robins and consumer advocates. The Supreme Court under Chief Justice John Roberts Jr. has been mostly sympathetic to the business community. The decision to take the Spokeo case, along with a related one called Tyson, suggest conservatives on the court want to limit class action lawsuits against companies.
Meanwhile, Supreme Court watchers predict the Justices will reverse a lower court’s ruling, and vote 7-2 in favor of Spokeo. But of course, no one can say for sure what the Court will decide or how far its decision (likely to come early in 2016) will reach.
Where can I learn more about this?
SCOTUSblog, a popular site about the Supreme Court, has all the filings, and will have a summary of the live arguments, which start at 10am ET on Monday. Meanwhile, the LA Times has a close look at the facts surrounding the case, while the New York Law Journal has a detailed legal analysis. To hear the consumer perspective, the Constitutional Accountability Center has an audio interview with lawyers familiar with the issue.
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