Cy Pres Part Deux
Elizabeth A. Kramer— November 9, 2018
On October 31 the Supreme Court heard argument in a “cy pres only” settlement case. Based on the argument, the original cy pres question that was presented in Frank v. Gaos may be eclipsed by questions about whether the class action plaintiffs even had standing to sue Google.
The Frank v. Gaos Class Action
For background on cy pres and the facts of the case, see our last post. In short, the plaintiffs alleged that Google violated privacy protections by sharing with third parties the search terms that users type into Google’s search bar.
The parties settled for $8.5 million, but the size of the class—almost 130 million people—made direct distribution infeasible. Instead, with the district court’s approval, the money went to six organizations concerned with internet privacy.
Cy Pres or Spokeo: Oral Argument
Divergent views from the Supreme Court included Justice Alito’s: “how can you say that it makes any sense?” to pay organizations instead of class members; and Justice Ginsburg’s observation that if class members would otherwise get nothing, “at least they get an indirect benefit” from the organizations. But much of the argument was consumed by a topic the parties didn’t even raise—whether the plaintiffs had standing to bring the class action in the first place under the Court’s 2016 Spokeo v. Robins ruling.
In Spokeo, the Supreme Court held that a bare statutory violation doesn’t give a plaintiff standing to bring her case in federal court—she must also allege concrete harm. The Court explained that the history of common law decisions or the judgment of Congress may demonstrate that an alleged harm is concrete enough for plaintiffs to have standing to be in court.
That issue came up for the class plaintiffs in Frank v. Gaos before Spokeo was decided, and the district court found that a statutory privacy violation alone was enough to establish standing. On appeal in the Supreme Court, an amicus brief from the Solicitor General raised standing, and during argument several Justices expressed doubt that the class plaintiffs could satisfy Spokeo.
What’s Next? More Briefs and a Supreme Court Decision
On November 5, the Court ordered the parties and the Solicitor General to file supplemental briefs about whether the plaintiffs’ allegations that Google shared their searches with websites they visited give rise to a “concrete” injury. Stay tuned.
Our Commitment to Excellence
Girard Sharp LLP represents consumers, investors, and institutions in class actions and other complex litigation nationwide. Our class action lawyers have obtained multimillion-dollar recoveries for victims of unfair and deceptive practices in antitrust, financial fraud, and consumer protection matters against some of the country’s largest corporations (including Raymond James, John Hancock, Sears, Yahoo, and JP Morgan Chase). Girard Sharp LLP has earned top tier rankings from U.S. News and World Report for Securities and Class Action Litigation and was selected as a 2018 Elite Trial Lawyers finalist by the National Law Journal.