Class action lawsuits are a staple in the American court system. The notion that there is strength in numbers is shown in the extraordinarily large settlements that come from these cases. In recent years, there has been a significant increase in class action suits involving internet-based companies (e.g., Facebook, Google, Tumblr, Instagram, or MySpace).
As consumers spend more time on the Internet, sharing their work, preferences, and private information, there is a growing potential for internet law violations. Since numerous consumers engage in same or similar activities, e.g., use email to send/receive information, a single violation implicates the rights of a large group of consumers. In turn, this sparks a class action suit.
How Are Class Action Lawsuits Different From Other Suits?
First, this type of lawsuit is different from the typical suit because of the number of parties involved. A class action lawsuit involves a set of circumstances where the plaintiffs consist of a group that have experienced a similar type of harm. This group can consist of individuals or corporate parties. Filing requirements depend on whether the plaintiffs file the suit in state court or federal court. Additionally, each state has different requirements to qualify for class action certification. While most states have adopted procedural rules similar to federal rules, some states, like California, have very different class action requirements. Since these cases involve such large groups of people, they bring the added threat of exposure to high profile parties. In the case of Internet-based cases, entities such as Google, Yahoo, Facebook, and several others have experienced unwanted publicity for their involvement in these suits. Typically, once a class action lawsuit is underway, the parties will send out a legal notice to anyone who may be affected and anyone who may have a claim in the lawsuit. These parties then have the option to join the class action, waive their interests, or hire their own legal counsel. By choosing to waive out of the suit, you may also waive any right to bring a similar suit against the same company in the future. The specifics depend on the content of the legal notice.
How Are Class Action Lawsuits Affecting Internet-Based Companies?
The increase in internet-based class action litigation has targeted high-tech companies for unlawful practices. An example is Fraley v. Facebook. Here, plaintiffs sued Facebook, alleging that it misappropriated or misused its users’ names and preferences to come up with advertisements or “sponsored stories.” Facebook made substantial profits using these ads and selling user preferences to third-parties. The legal issues rested on the fact that Facebook did not have permission from its members to use the information. Furthermore, Facebook did not pay its users any profits from these advertisements. According to California law on misappropriation, it is unlawful to use a person’s “likeness” (e.g., name, voice, photograph, or signature) for advertisement without the person’s consent. As is common with class action suits, the parties ultimately settled out of court. In this case, the settlement was for $20 million dollars. Users who responded to the legal notice and opted into the lawsuit received a portion of this settlement.
At the Law Offices of Salar Atrizadeh, we provide clients with the guidance and legal expertise to protect against internet and cyber law violations. You may contact us to setup a free and confidential consultation.