Who: William Gourley; Jose M. Bermudez; Nicholas Todd Heinrich; Lynne Krause v. Google Inc.; Vibrant Media Inc.; Media Innovation Group LLC and WPP PLC
Where: United States Court of Appeals for the Third Circuit
When: 10 November 2015
Law stated as at: 7 December 2015
In 2012, the Wall Street Journal published a report alleging that Google (and others) had discovered loopholes in both Safari and Internet Explorer’s advertised cookie blockers, and, in Google’s case, had written code to systematically circumvent cookie-blockers.
This garnered the attention of the Federal Trade Commission, resulting in a $22.5 million penalty and imposition of conditions for Google, but no admission of former wrongdoing. Further, Google reached a $17 million settlement with 38 state attorney generals. Lawsuits were also filed in several federal district courts, which were consolidated into the present class action.
California class action
In one of many subsequent class actions, in this case launched in California, the class comprised: “all persons in the United States of America who used the Apple Safari or Microsoft Internet Explorer web browsers and who visited a website from which…(Google’s advertising serving service)…cookies were deployed as part of a scheme to circumvent the users’ browsers’ settings to block such cookies and which were thereby used to enable tracking of the class members[’] [i]nternet communications without consent” (emphasis added).
The District Court found in Google’s (and the other defendants’) favour and dismissed the case on all grounds.
An appeal to the Third Circuit Court of Appeal, however, has been successful on a point of California state law and thus breathed new life into the litigation.
The Third Circuit held that Google not only contravened cookie-blockers, it also held itself out as respecting cookie-blockers. Regardless of whether cookies were the norm, users were entitled to deny consent and to rely on the promises of companies they dealt with. They concluded that “the reasonable factfinder could indeed deem Google’s conduct “highly offensive” or “an egregious breach of social norms“. The Third Circuit accordingly vacated the lower court’s dismissal.
Why this matters:
The judgment strongly echoes the English Court of Appeal’s decision in March 2015 in the case of Vidal Hall & Ors vs Google, Inc . This was litigation brought against Google, Inc in the English High Court by three UK Safari browser users and based on essentially the same facts.
The pleaded grounds included misuse of private information and breach of the UK Data Protection Act 1998. A key argument was that the serving of personalised ads on the claimants’ devices which could be viewed by others using the same device could reveal personal data of the claimants and thereby cause distress.
The Appeal judges upheld what was a landmark first instance judgment against Google, in which leave was granted for service of the proceedings out of the jurisdiction on Google, Inc in the US. Google has since been granted permission to appeal the decision by the UK Supreme Court – watch this space.
Whilst Google et al successfully defended the California class action on all points of federal law, and only lost on one point of state law; online advertisers should nevertheless pay close attention to this judgment, and to the on-going developments in Vidal-Hall.