Commentary

Supreme Court Debates Consumers' Right To Sue Data Brokers

In 2010, Virginia resident Thomas Robins sued the online data aggregator Spokeo for incorrectly publishing that he was in his 50s, married with children, and employed in a professional or technical field. Robins said that he was seeking a job when he filed suit, and worried that the errors in the report would affect his job search.

He accused Spokeo of violating the Fair Credit Reporting Act, which requires credit reporting agencies to ensure the accuracy of background reports used for employment, housing and credit.

Spokeo countered that Robins lacked "standing" to proceed in federal court, because he couldn't show how he had been harmed by any inaccuracies.

Today, the Supreme Court heard arguments about that question. While there's no way to know how the court will vote, the judges' comments suggested strong views on both sides of the issue.

Elena Kagan was among the judges who expressed support for Robins.

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"I'll just say seems like a concrete injury to me," Kagan said. "I mean, if somebody did it to me, I'd feel harmed. And I think that if you went out on the street and you did a survey, most people would feel harmed."

"They basically got everything wrong about him," Kagan added. "They got his marital status wrong. They got his income wrong. They got his education wrong. They basically portrayed a different person."

Sonia Sotomayor also voiced support for Robins. "I will tell you that I know plenty of single people who look at whether someone who's proposed to date is married or not. So if you're not married and there's a report out there saying you are, that's a potential injury," she said.

But several other judges, including Samuel Alito, suggested that they were inclined to rule for Spokeo.

Alito asked whether any harms to Robins were purely "speculative," given that he didn't know if anyone ever searched for him on Spokeo.

"Is there anything here to indicate that anybody other than Mr. Robins ever did a search for him?" Alito asked Robins' attorney.

"Not in the record that I'm aware of," the lawyer answered.

"Then isn't that quintessential speculative harm?" Alito asked next.

The court's ruling in the matter could affect a broad array of class-actions -- including privacy cases -- where consumers allege that a Web company has violated a specific law. In many of those situations, the companies contend that the lawsuit should be dismissed at a preliminary stage because the consumers weren't harmed by the alleged violation.

The high stakes spurred numerous outside groups to weigh in on the question. Google, Facebook, eBay and Yahoo asked the Supreme Court to side with Spokeo and dismiss the lawsuit. The tech companies say that "no-injury" lawsuits harm their businesses.

But digital rights groups Electronic Frontier Foundation, Center for Democracy & Technology, New America's Open Technology Institute and the World Privacy Forum are asking the court to allow Robins to proceed, arguing that data brokers like Spokeo "have little incentive to follow the law," without the threat of litigation.

The Obama administration is urging the court to rule in favor of Robins.

The court is expected to issue a decision by next July.

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