As more organizations collect data to enhance their products or services, privacy is in the forefront of everyone's minds, earning it a place in the class action spotlight. At the 2023 Class Action Law Forum, the Honorable Vince Chhabria (Northern District of California), Jean Martin (Morgan & Morgan), Andre Mura (Gibbs Law Group), and Purvi G. Patel (Morrison Foerster) gathered to discuss the rise of privacy class actions. San Diego Federal Bar Association Immediate Past President Dylan Aste (U.S. Attorney's Office) moderated the panel.
To stay ahead of privacy class actions, companies should regularly assess their data collection policies and practices. Companies are increasingly focused on balancing the need for personalized services with consumers' privacy interests. As Purvi, managing partner of MoFo's Los Angeles office, explained, it is convenient and valuable for a consumer when they open a food delivery app to see exactly what they most recently ordered from the restaurant they have selected. To order the same item, with any customizations, all they have to do is click on the "recently ordered" item. That same prior order information could also help consumers avoid re-ordering something they did not enjoy. However, companies cannot provide that convenience and personalization without collecting and storing data. Purvi explained that, even if the intent behind a data collection policy or procedure is to benefit the consumer, companies should regularly assess how the practice might appear to a consumer or potential litigant.
Businesses, large and small, may end up the targets of privacy class actions even when their data collection benefits consumers. These class actions, at times, target core business functions, potentially impacting the company's business model. Toeing the line between how much data to collect and what consumers view as "acceptable" data collection can be tricky. As a result, it is important for businesses to approach data privacy practices in a holistic manner, including data collection, use, and retention as well as related disclosures. Stepping into the shoes of consumers and potential litigants from the outset can proactively mitigate risk and help prevent future litigation.
Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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