Class-action style compensation not allowed in Lloyd v Google LLC

The Supreme Court has today ruled that the Apple Iphone users affected by Google collecting and using their browser generated information are not allowed class-action style compensation under the data protection law.

In Lloyd v Google LLC, Mr Lloyd sought to bring a claim in a representative capacity on behalf of 4 million consumers. The Supreme Court said that in this case, a representative claim could have been brought to establish whether Google was in breach of the DPA 1998 as a basis for pursuing individual claims for compensation. However, the claimant had not proposed such a two–stage procedure.

The central question was whether the individuals had suffered ‘damage’ within the meaning of section 13 of the Data Protection Act 1998, which provides that "an individual who suffers damage by reason of any contravention by a data controller of any of the requirements of this Act is entitled to compensation from the data controller for that damage".

It is the Supreme Court’s view that "damage" refers to material damage (such as financial loss) or mental distress, but in this case, members of the class did not have the ‘same interest’ in the claim and each claimant must establish that they have personally suffered.

Richard Jeens, Partner at Slaughter and May said:

“This decision will be a huge relief for many organisations, particularly those in data-intensive sectors. It acknowledges that individuals’ data is personal to them and cannot be reduced to a common denominator to support claims driven by litigation funders. Importantly, the court also made clear that compensation cannot be recovered for alleged data privacy breaches without in fact proving there has been some damage or harm caused.”

“While the court was clear that a representative action could be brought to resolve points of principle – and there remain many unanswered questions pertaining to extra-jurisdictional class-members, the potential to divide categories of ‘interest’ using sub-classes and the effect of mass claims on limitation periods – there is a real question whether it will be attractive to litigation funders to take cases that may only lead to an award of damages at a second stage.”

The judgement, issued on 10 November.

Read an article on GDPR enforcement trends across Europe and the UK by Slaughter and May lawyers in PL&B UK Report, out on Monday.