February 03, 2016 Practice Points

Data Breach Class Actions: 2015 Year in Review and 2016 Preview

A quick look back and ahead

by Kristin A. Shepard

As 2016 begins, questions over standing in data breach class actions remain. In 2015, the Seventh Circuit denied retailer Neiman Marcus’s petition for rehearing en banc of a panel opinion holding that plaintiffs whose credit card information was stolen in a data breach had standing to sue under Article III of the United States Constitution on the basis of alleged fear of future identity theft. See Remijas v. Neiman Marcus Group, LLC, No. 14-3122 (7th Cir. July 20, 2015), reh’g denied, (Sept. 17, 2015). In denying the petition for rehearing, the Seventh Circuit confirmed that the circuit split on standing in data breach class actions survives Clapper v. Amnesty International USA, 133 S. Ct. 1138 (2013), in which the Supreme Court held that, in order to satisfy Article III, any alleged “future harm” must be “certainly impending” and that “allegations of possible future injury are not sufficient.” The due date for the retailer’s petition for writ of certiorari has been extended to Feburary 14, 2016.

In 2015, the Supreme Court heard oral argument on the scope of Article III standing in two cases that may be of interest to those monitoring data breach class actions. In Spokeo, Inc. v. Robins, No, 13-1339,the Court has been asked to address this: “Whether Congress may confer Article III standing upon a plaintiff who suffers no concrete harm, and who therefore could not otherwise invoke the jurisdiction of a federal court, by authorizing a private right of action based on a bare violation of a federal statute.” In Tyson Foods, Inc. v. Bouaphekeo, No. 14-1146, the Court was petitioned to resolve the question of “whether a class action may be certified or maintained under Rule 23(b)(3) … when the class contains hundreds of members who were not injured and have no legal right to any damages.” A ruling narrowly construing the Article III standing requirement in these cases would bode well for the defense bar, as well as be a blow to class counsel—who have sought to distinguish the Court’s precedent in Clapper as factually inapposite to class actions.

Premium Content For:
  • Litigation Section
Join - Now