Of course, it’s always about the money. Pitch all you like on the basis of lofty aspiration, high falutin’ principles and access to justice for the little guy. In the end, it’s always about the money.
The case of Lloyd v. Google recently decided by the Supreme Court of the UK was an attempt to establish a claim put at £750 per individual affected. But what caused lawyers and litigation funders to salivate was the fact that many millions of individuals were in fact affected by data breaches arising from the placement of advertising tracking cookies on iPhones in 2011 – 2012. There was a potential damages pot of several billions of pounds.
Group litigation can be managed on a bespoke basis under a Group Litigation Order under rule 19.11 of the Civil Procedure Rules but the very nature of the requirements for active management of cases means that even if lead cases are chosen and litigated on a test basis, the underlying claims will still need to considered on something of an individual basis. Any such process is only available on an “opt-in” basis.
Because “opt-out” collective litigation is only available in the context of competition claims, the data breach claim against Google was presented as a “representative action” under rule 19.6 of the Civil Procedure Rules. This enables an individual to bring a claim on behalf of a wider group if all members of the class have the “same interest” in the claim.
To enable the claim to go forward on this assumption, it was necessary to persuade the court that each class member’s individual circumstances should be ignored and damages attributed on a “lowest common denominator” basis: £750 being apparently as good a figure as any other.
Because it was being sued as a an overseas entity and permission to serve the proceedings was necessary, Google challenged the claim arguing that it did not overcome this threshold. The judge at first instance agreed. He said that “it would not be unfair to describe this as officious litigation” and that the claim should not “be permitted to consume substantial resources in the pursuit of litigation on behalf of others who have little to gain from it, and have not authorised the pursuit of the claim, nor indicated any concern about the matters to be litigated” (Mr Justice Warby). The Court of Appeal was more sympathetic to the claimants arguments and so the case hit the Supreme Court for a final appeal.
Lord Leggatt gave the judgment of a unanimous court. He pointed out that a data breach claim under the then applicable legislation was a claim for damages. It was possible in some types of claim for all represented class members to suffer exactly the same loss, for instance if they had all been overcharged by the same sum or bought a defective product which was worth equally less in each case. But in most cases there needs to be an individualised assessment of damages or the extent of any “distress”. In order to quantify damage, information would be needed from each individual about what data of theirs was processed and over what period. A representative action is not an appropriate vehicle for this because the individuals in the class do not participate in the process.
A judgment in the claimant’s favour would no doubt have opened the doors to more representative actions in other data protection cases, allowing consumer rights defenders to bring class-action style claims against companies that are accused of breaching privacy law. The floodgates have now apparently been pulled too.
Enthusiastic claimant lawyers and funding speculators seeking to drum up business may look for distinctions involving claims under the updated data protection regime under the General Data Protection Regulation, or even the law of misuse of private information giving rise to privacy claims. However, the same hurdles may be met.
The case is a certainly a dampener for the enthusiasm of those seeking to establish groups seeking collective redress since their focus is not really on individual rights but on maximising recovery and taking a cut. As I said at the outset of this note, what is really talking is the money. The Supreme Court has provided a note of restraint to the mass claims funding industry.
