SCOTUS Privacy Case May Be Consumer Litigation Windfall

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By Daniel R. Stoller and Jimmy H. Koo

A U.S. Supreme Court demand that the government obtain warrants to search mobile device geolocation data would provide a new touchstone to boost consumer privacy litigation, privacy attorneys told Bloomberg Law Nov. 30.

The parties in Carpenter v. United States sparred Nov. 29 before the Supreme Court over the application of the third-party doctrine, which holds that individuals don’t have a reasonable expectation of privacy in information they voluntarily disclose to third parties, such as bank records given to financial institutions. The government argued that under the doctrine, location data consumers transmit to their mobile service carriers is available to law enforcement without a warrant. Some Supreme Court Justices made comments during their questioning that indicated a willingness to consider better protecting digital privacy ( Carpenter v. United States , U.S., No. 16-402, oral arguments 11/29/17 ).

The case involves Timothy Ivory Carpenter, who is seeking to overturn his conviction for taking part in a string of armed robberies of Detroit-area Radio Shacks and T-Mobile US Inc. stores. At trial, prosecutors used four months of data obtained from Carpenter’s wireless carriers to show he was within a half-mile to two miles of the location of four of the robberies when they occurred.

A ruling requiring the government to obtain warrants to access geolocation data would provide a privacy touchstone outside the criminal context to the plaintiffs’ bar in civil consumer privacy cases, attorneys said.

Such a ruling would signal to civil and criminal courts, that “digital data deserves greater privacy protections,” Michael Whitener, data security and privacy partner at VLP Law Group LLP in Santa Fe, N.M., told Bloomberg Law Nov. 30. It would show that “the law is evolving toward recognizing the right to privacy” in more contexts as technology evolves, he said. Whitener worked with John Roberts at Hogan & Hartson—now Hogan Lovells—before Roberts became chief justice.

What’s Next?

The third-party doctrine isn’t likely to disappear.

The court isn’t likely to completely up-end 41 years of third-party doctrine precedent but may rule that “mobile location data is such a significant privacy interest that a warrant is required,” Tyler G. Newby, co-chair of the privacy and cybersecurity group at Fenwick & West LLP in San Francisco, told Bloomberg Law Nov. 30.

Civil privacy litigation “challenging business collection and use practices, as well as suits based on public disclosure of private facts,” will likely get a boost if the Supreme Court demands warrants, Newby said. Going forward, “a company will need to be very clear in how it is storing, collecting, and disseminating consumer location data,” he said.

But even a modification of the third-party doctrine in the context of mobile phone geolocation data would have significant effects.

“It is surprising how much incredibly invasive information the government is able to obtain from companies without a warrant or court approval,” Matthew L. Schwartz, governmental and internal investigations partner at Boies Schiller Flexner LLP in New York, told Bloomberg Law Nov. 30. So if the court changes or modifies the third-party doctrine, there may be a “ripple effect on law enforcement and companies that create or handle data,” he said.

There could be a rush of new privacy cases at the Supreme Court, depending on the scope of its decision in Carpenter.

Technology is changing rapidly, so other privacy issues related to mobile device data are likely to come up, Pierre Grosdidier, privacy litigation counsel at Haynes and Boone LLP in Houston, told Bloomberg Law Nov. 30. “This isn’t the end in a long line of complex and sophisticated privacy cases,” he said.

Consumer Confidence

The high court’s decision may significantly impact the operations of internet of things companies that collect consumer data.

The ruling in Carpenter, which should be released by June 2018, “will have a significant impact on consumer privacy,” Grosdidier said. Consumers “want to know whether the government can access location data on their IoT devices without a warrant.”

A decision that increases privacy protections will help increase consumer confidence in IoT products, and make clear that the government can’t access such information without a warrant.

Privacy groups also think that a warrant requirement ruling will help grow the already exploding mobile and IoT market.

The decision “can be critical to consumer confidence in the IoT industry,” Nathan Freed Wessler, staff attorney at the ACLU, told Bloomberg Law Nov. 30. Consumer trust “has to be backed by strong legal protections.” The ACLU represented Carpenter before the court, and Wessler argued on his behalf.

To contact the reporter on this story: Daniel R. Stoller in Washington at dstoller@bloomberglaw.com; Jimmy H. Koo in Washington at jkoo@bloomberglaw.com

To contact the editor responsible for this story: Donald Aplin at daplin@bloomberglaw.com

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