Judge allows for limited class action against Apple and Path app for data breach

By Erik Derr | Aug 12, 2016

SAN FRANCISCO – Apple Inc. is asking a federal appeals court to overturn last month's ruling by U.S. District Court Judge Jon Tigar in the Northern District of California that an estimated 480,000 Apple users who downloaded the Path social network app can continue as a class against Path Inc. and Apple.

In a late-July filing, Apple's request for permission of the 9th Circuit Court of Appeals to appeal the order that granted class-action status to nearly the nearly half-million tech users who downloaded the Path app to their iPhones, iPads and iPod Touch mobile devices – and then had their private data mined by the program – between Nov. 9. 2011, and Feb. 7, 2012.

Tigar's decision came four years after a group of mobile users sued Apple and Path, one of four consolidated class-action suits filed in California and Texas.

The suit accused Apple of distributing invasive versions of the Path app, which acquired information from individual users' contacts without their knowledge or consent. Path then kept the data that included email addresses and other demographic material.

The plaintiffs attempted to advance similar claims against other app developers, such as Yelp, Instagram and Twitter, but Tigar said the class-action claims would be limited, at least for the time being, to Apple and Path.

He denied certification to a larger user class, saying only members of the "intrusion upload subclass" who logged into the app and had their data breached were actually injured.

The lawsuit specifically alleges that the address-book uploads amount to "intrusion upon seclusion," which is actionable in California.

In his July 15 decision, Tigar denied claims that choice-of-law questions made class certification impractical. He said Apple and Path had failed to prove that applying California law to the case would impede the interests of other states where plaintiffs live.

The judge nonetheless sided with Apple and Path by finding the plaintiffs had not presented any viable method for calculating a class-wide value of privacy.

"The decision should provide some relief to technology, media, and content driven companies especially relating to privacy issues...although the court did allow a very limited class to move forward," Torin Dorros, a Los Angeles-based business attorney who specializes in high-tech cases, told the Northern California Record.

"All in all, it's a bit of a win for both sides," he said. "The plaintiffs do get to proceed as a class with the potential for class-wide nominal damages and possibly punitive damages if they can be justified down the road, however Apple and Path were able to severely restrict the initially requested class size or population as well as to wipe out class compensatory damages."

The fact that "the class was restricted to only those persons who were actually injured by the Path app – actually had their contacts uploaded without permission and was further limited to only those app customers whose contacts were uploaded using the version of the app that did not provide for a user opt out," said Dorros, underscores "the importance of including clear opt in or opt out options for customers especially where privacy concerns are implicated."

Once the Path app included an "opt-out" provision, the privacy intrusion became a matter of choice rather than a privacy violation, he said.

In papers submitted to the 9th Circuit Court of Appeals, Apple asserts the matter should not be allowed to progress as a class-action against any defendants because determining "intrusion upon seclusion" claims requires case-by-case decisions.

"Binding California case law makes clear that this claim requires an assessment of the subjective privacy expectations and mental anguish of each individual class member," Apple said in the latest filing. "If not immediately corrected, the district court’s errors will likely be repeated when plaintiffs move to certify multiple additional classes...There is no reason to waste the time and resources of both the district court and the parties by litigating putative class claims when certification turns on manifestly erroneous legal conclusions."

The plaintiffs must submit all remaining motions for class certification against the 16 remaining defendants by Aug. 23.

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Apple Inc. U.S. District Court for the Northern District of California

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