Published by LawTechie - November 21, 2011 - LawTechie

Privacy Laws, Class Action LawsuitI blogged about the RockYou class action lawsuit back in April and then in May, noting that the judge’s decision to allow plaintiff to proceed on its privacy breach claims, which cited several privacy laws despite being able to show any resulting damages, would result in an increase of nuisance value of privacy lawsuits in so far as plaintiffs can stay in the lawsuit longer and hold out for a better settlement from companies.

That settlement has arrived.

According to the stipulated judgment (linked above), RockYou has agreed to a 36 month injunction whereby it would consent to 2 audits of its data security system, it also agreed to $292,000 in damages and attorneys’ fees. The nuisance factor? Only $2,000 of that settlement goes to the plaintiff, the rest to the lawyers. Clearly the judge’s April ruling gave the lawyers incentive to continue the case meanwhile we all knew that the plaintiff — lacking any provable damages — was just there as a vehicle for the attorneys to make money.

The fact that this was a class action lawsuit does not add much to the mix either because $2,000 split among however many members of a class is not all that much. Moreover, while this settlement does not preclude additional plaintiffs from bringing another class action lawsuit, since an injunction was already granted, the only possible relief is monetary damages — which we already see does not amount to much.

LawTechie is a blog focusing on trends in tech and digital media. Areas covered include intellectual property, cyberlaw, venture capital, transactions and litigation as they relate to the emerging sectors. The blog is edited by the firm's partner Tim Bukher with contributions from the firm's experts in their respective areas of law.


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