April 06, 2021

Disparity between California’s Privacy Laws and Class Action Discovery Rights Embodied in Case Law

The enactment of the California Consumer Privacy Act (“CCPA”) in 2019 strengthened certain privacy protections for consumers. The CCPA protects consumers by requiring businesses to “inform consumers as to the categories of personal information to be collected and the purposes for which the categories of personal information shall be used,” and prohibiting businesses from using such “personal information collected for additional purposes without providing the consumer with notice.”

As defined by California law and thus under the CCPA, a “consumer” is defined as “a natural person who is a California resident.” Further, “personal information” includes a consumer’s name, postal address, email address or other similar identifying information.

Proposition 24, or the California Privacy Rights Act (“CPRA”), enacted in November of 2020, further supports the CCPA’s objective by strengthening the rights of consumers to control how their private information is used. The CPRA commands courts to allow consumers more power to limit whether or not class action plaintiffs, and their attorneys, can acquire their personal information.

With this being said, the privacy protections afforded to consumers by the CCPA and CPRA seem to be at odds with principles of discovery in class actions established by California case law. In California, a plaintiff in a consumer class action can discover the names and addresses of members of the presumed class. Even though presumed class members have a constitutional right to privacy, such a right can be protected with an opt-out notice. An opt-out notice provides a consumer advance notice that the consumer’s personal information will be used in a certain manner and the opportunity to prevent any disclosure of personal information to third parties.

However, Pioneer Electronics (USA), Inc. v. Superior Court, decided in 2007 by the California Supreme Court, is the original decision permitting class contact information discovery after opt-out notices for consumer class actions. Since there were no statutes protecting the disclosure of consumer personal information, the Pioneer Electronics court looked to the common law privacy principles established in Hill v. National Collegiate Athletic Association, another California Supreme Court case, and its progeny to formulate its analysis.

In doing so, the Pioneer Electronics court held the divulging of consumers’ personal information “involved no serious invasion of privacy” since such information contains “no revelation of person or business secrets, intimate activities, or similar private information, and threatens no undue intrusion into one’s personal life, such as mass-marketing efforts or unsolicited sales pitches.” This rationale tracked the analysis in the Hill decision, whereby the court held the invasion of privacy occurs when “(1) a legally protected privacy interest; (2) a reasonable expectation of privacy in the circumstances; and (3) conduct by defendant constituting a serious invasion of privacy.”

Recently, in 2017, the California Supreme Court recognized in Williams v. Superior Court that the Pioneer Electronics court found that “the second Hill requirement, a reasonable expectation of privacy in the particular circumstances, is not met” when concerning personal information sought by a class-action plaintiff seeking to redress common claims.

As such, the CCPA and CPRA, which seek to protect consumers’ privacy, seem to be at odds with the state’s case law regarding consumers’ personal information. Such inconsistency between California legislation and case law concerning consumer privacy necessitates a reassessment of a consumer’s right to protect his or her personal information as a presumed member of a consumer class action. The goal of such a reassessment must be to close the disparity in the protections afforded to consumers over the disclosure of their personal information by the CCPA and CPRA and the caselaw regarding presumed members of a class action after such members give their advance opt-out notices.

1. Cal. Civ. Code § 1798.100(b).

2. Cal. Civ. Code § 1798.140(g).

3. Cal. Civ. Code § 1798.140(o)(1)(A).

4. See Pioneer Electronics (USA), Inc. v. Superior Court, 40 Cal. 4th 360 (2007).

5. Hill v. National Collegiate Athletic Ass'n, 7 Cal. 4th 1 (1994).

6. Pioneer Electronics was decided prior to the enactment of the CCPA.

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This entry was posted on Tuesday, April 06, 2021 and is filed under Resources & Self-Education, Internet Law News.

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