Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every
Speaker 1: day we bring you insight and analysis into the most
Speaker 1: important legal news of the day. You can find more
Speaker 1: episodes at the Bloomberg Law Podcast, on Apple Podcasts, SoundCloud,
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Speaker 1: have faced dozens of consumer class claims in California federal
Speaker 1: courts in recent years after a series of high profile
Speaker 1: privacy and security breaches. Joining me is Eric Goldman, a
Speaker 1: professor at Santa Clara University Law School and co director
Speaker 1: of the High Tech Law Institute, have federal courts in
Speaker 1: California lowered the bar for consumers to bring privacy cases
Speaker 1: against the tech giants. The California courts are seeing a
Speaker 1: lot of the privacy relegation nationwide, so they're dealing with
Speaker 1: a higher volume than any other courts, and many of
Speaker 1: those courts are resolving the first threshold question cann this
Speaker 1: case even be heard in court, and many of the
Speaker 1: California carts are being sympathetic to the plaintiffs in those
Speaker 1: rulings and willing to entertain lawsuits that might not succeed elsewhere.
Speaker 1: Is it because the Ninth Circuit is known as a
Speaker 1: liberal circuit, and their decisions are following the case law there,
Speaker 1: or is it for another reason. It's a little hard
Speaker 1: to pinpoint why the California courts might be more sympathetic. Certainly,
Speaker 1: California has a reputation is being sympathetic to planet arguments
Speaker 1: and open to lawsuits generally. But this particular question on
Speaker 1: privacy lawsuits about whether the litigants even have the right
Speaker 1: to be in court really derives from a two thousand
Speaker 1: and sixteen Supreme Court case that the courts across the
Speaker 1: country have just read differently. And so it's not clear
Speaker 1: if the California courts are more biased in one direction
Speaker 1: another or they're just reading the cases differently than other
Speaker 1: courts are. Tell us about that last Supreme Court case
Speaker 1: in Yeah, it was kids called Spokeyo versus Romans, and
Speaker 1: the Smokeyo case addressed a very threshold question. In order
Speaker 1: to get into federal court, planists have to show that
Speaker 1: they suffered some cognizable injury. They can't just go into
Speaker 1: court and say I'm upset. They have to show that
Speaker 1: they suffered some problem that the law recognizes. Now, that's
Speaker 1: not proof that they suffered problems, but they can't even
Speaker 1: articulate how they suffered a guisle injury. The courts are
Speaker 1: supposed to dismiss the case, basically saying, that's not the
Speaker 1: kind of case that we're allowed to hear in the
Speaker 1: first instance. And in the sixteen Supreme Court case, the
Speaker 1: court gave us some guidance about when the planets suffer
Speaker 1: cognizable injury. But the guidance the court gave us was
Speaker 1: somewhat confusing, and that's one of the reasons why courts
Speaker 1: across the country have been reading it differently. Have there
Speaker 1: been appeals to the Supreme Court on these standing issues
Speaker 1: in privacy cases since then and the Court just hasn't
Speaker 1: taken it up. Actually, I'm not sure if there have
Speaker 1: been any appeals of that issue to the Supreme Court.
Speaker 1: But even if they're worth the Supreme Court takes a
Speaker 1: very small fraction of the their appealed to it, well
Speaker 1: less than one percent. So it wouldn't be unusual for
Speaker 1: the Supreme Court not to take another case in this
Speaker 1: area for a while, but to let the issue play
Speaker 1: out in the lower courts and only after the problems
Speaker 1: have emerged. Clearly, would the Supreme Court come back in
Speaker 1: and take another case. Is there any way to account
Speaker 1: for the fact that the Ninth, the seventh, and the
Speaker 1: d C circuits seem to be more proplaintive in this
Speaker 1: area and the fourth and the second are less proplaintive.
Speaker 1: Is it just the luck of the draw of the
Speaker 1: panel that they get or is there a proplaintive bias
Speaker 1: in those particular circuits. I don't think of the circuits
Speaker 1: that you mentioned as being particularly proplaintive, especially the Seventh Circuit,
Speaker 1: which historically has actually been viewed as a pro business circuit,
Speaker 1: so it would be actually unusual for them to be
Speaker 1: considered a pro plaintive circuit. And I don't think it's
Speaker 1: the differences between panels on the appellate courts as much
Speaker 1: as just the Supreme Court case has so many ambiguous
Speaker 1: and possibly contradictory statements that of course across the country
Speaker 1: have really struggled to figure out what it means. So
Speaker 1: that's why once one of the circuits starts to answer
Speaker 1: for the circuit, you might start to see these different
Speaker 1: precedents emerge on the circuits that look pro plaintive. But
Speaker 1: it's just because the first panel that heard that particular
Speaker 1: issue may have read the opinion in a particular way
Speaker 1: that led towards a more proper plaintive outcome. Is there
Speaker 1: a case that you think particularly well explains the kind
Speaker 1: of standing issues that we're talking about here. The case
Speaker 1: that stands out of my mind, it's the Zappo's case.
Speaker 1: It involves a data breach by the retailers Zappos, and
Speaker 1: many millions of records were released, and after several years
Speaker 1: in the case, so the case proceeded on in court
Speaker 1: for years, the defendant moved to dismiss the case, saying
Speaker 1: there wasn't a standing because of the fact that nobody
Speaker 1: had ever shown that their data actually been misused. So
Speaker 1: there were millions of consumers who are affected by the breach,
Speaker 1: and after all the work on all the LITA gives
Speaker 1: to try and find evidence of a problem, there was
Speaker 1: no evidence that anyone ever suffered a breach. And the
Speaker 1: court still said, even though after three plus years of
Speaker 1: developments in the area where the data has been available
Speaker 1: and could be misused, we still think that the case
Speaker 1: should proceed because of the fact that consumer data was
Speaker 1: released even though there's no evidence anyone's ever used it,
Speaker 1: and that should be pretty good evidence possibly no one
Speaker 1: ever suffered any harm from the case. Well, privacy suits
Speaker 1: get more aggressive until the Supreme Court decides to take
Speaker 1: a case and perhaps rain them in. There's no doubt
Speaker 1: that privacy litigation of the growth industry and the standing
Speaker 1: issue has contributed to the growth because of the fact
Speaker 1: that planefts have been able to find ways to get
Speaker 1: into court even if they can't show the kinds of
Speaker 1: harms we would expect planeffs to show. That's been emboldening
Speaker 1: plane us to bring more cases. I would also point
Speaker 1: out in California there's a new data breach law that's
Speaker 1: gonna be going into effect on January one that specifies
Speaker 1: certain types of harms that can be recognized automatically, and
Speaker 1: that's going to encourage the planeffs to bring lawsuits also
Speaker 1: in California State corn and try and take advantage of
Speaker 1: the laws statutory damages which guarantee certain payoffs and minimum
Speaker 1: payoffs even if the planets can otherwise show harm. So
Speaker 1: data breach relegation is actually about to get a TERMO
Speaker 1: charge boost from the California law. What we've seen now
Speaker 1: I think is going to be just a small fraction
Speaker 1: of the amount of litigation that's going to be spurred
Speaker 1: by the California law. Thanks Eric, that's Eric Goldman of
Speaker 1: Santa Clara University Law School. Thanks for listening to the
Speaker 1: Bloomberg Law Podcast. You can subscribe and listen to the
Speaker 1: show on Apple Podcasts, SoundCloud, and on Bloomberg dot com
Speaker 1: slash podcast. I'm June Brasso. This is Bloomberg to end.
Speaker 1: In the end up of the fe