A federal judge has given initial approval to a $115 million deal to end a class action lawsuit against Oracle for allegedly violating privacy laws in California and elsewhere by allegedly using tracking technology to gather information about hundreds of millions of people using their software and then sell that information to advertisers.
Under the deal, attorneys who brought the lawsuit could stand to receive as much as $28.75 million in fees.
Documents filed in court outlining the settlement terms don't specify how much individual class members might receive under the deal. However, using information supplied in those documents, The Record estimates between 3 million and 6 million people could be in line to receive about $14-$25 each.
Richard Seeborg
| cand.uscourts.gov
On Aug. 9, U.S. District Judge Richard Seeborg, chief judge of the San Francisco-based U.S. District Court for the Northern District of California, granted preliminary approval of the settlement between Oracle and class members, represented by attorneys from the prominent class action law firm of Lieff Cabraser Heimann & Bernstein.
The lawsuit was filed in 2022 in San Francisco federal court by Lieff Cabraser on behalf of a group of plaintiffs, including named plaintiffs Michael Katz-Lacabe, Jennifer Golbeck and Johnny Ryan.
The lawsuit asserted Oracle America of allegedly conducting surveillance on its users and then acting as a data broker, selling the information they gathered to other companies to use to target advertising.
Oracle ranks as the third largest software company in the world. They make and sell datbase software and cloud computing. Oracle products are used in a multitude of capacities, including to more easily manage massive amounts of data and support customer interactions, among many others.
The lawsuit specifically accuses Oracle of violating customer rights under the California state constitution, California state law and other state and federal privacy laws.
Oracle failed to dismiss much of the legal action.
However, the company could have faced an appeal from plaintiffs, who sought to reverse the federal judge's ruling that they could not advance claims under the federal Electronic Communication Privacy Act (ECPA.) The plaintiffs sought to ask the U.S Ninth Circuit Court of Appeals to consider whether Oracle's alleged data brokering should trigger a "crime-tort exception" within the law and delete protections within the law shielding Oracle from those ECPA claims within the lawsuit.
However, in April, the two sides entered mediation, and in mid-July, they announced a settlement under which Oracle would pay a total of $115 million to end the lawsuit.
In a motion filed in support of the settlement, plaintiffs' attorneys acknowledged the laws under which they had brought the action could entitle them to perhaps many millions or even billions of dollars more. But they said they believed they faced a difficult road in securing such a larger payday through trial or settlement.
Under the settlement, class members submitting eligible claims would receive an equal, or pro rata share of the available settlement funds left over after attorneys and settlement administration costs are paid.
The plaintiffs' lawyers have not yet formally requested a fee award. However, in the settlement memo, they said they could ask for up to 25% of the settlement funds, or $28.75 million.
The remaining sum would be divided up among class members. They did not provide an exact number of class members who could be invited to participate in the settlement, nor an amount that would be paid to each of them.
However, in the settlement motion, the attorneys said they currently have emails for as many as 220 million potential class members. The settlement motion indicated they believed that in settlements for litigation like this, they could expect a claims rate of 1.5%-2.5%, or about 3.3 million to 5.5 million eligible claims.
That then could result in payments of about $15-$26 per person.
Claimants would have until Oct. 17 to submit eligible claims for a cut of the settlement funds.
The plaintiffs' attorneys called the settlement "outstanding," saying it would deliver "substantial relief" to the settlement class.
The motion for settlement also noted Oracle would agree to alter its business to come into line with the privacy laws plaintiffs claim they violated and end their alleged illegal data brokering practices.
The judge set a hearing for final approval of the settlement for Nov. 14.
The plaintiffs have been represented by attorneys Michael W. Sobol, David T. Rudolph, Jallé H. Dafa, John D. Maher, Amelia A. Haselkorn and Nabila Abdallah, of the Lieff Cabraser firm, of San Francisco.