Gibbons Law Alert

Gibbons Law Alert

Author: Gibbons P.C.

“Say Cheese!” CVS Passport Photo Practices Subject to BIPA Suit

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Posted in Class Action Defense / Privacy and Data Security / Privacy Class Actions

On August 11, 2023

In May 2022, a group of plaintiffs brought a putative class action against CVS Pharmacy, Inc. (CVS) alleging the company violated several provisions of the Illinois Biometric Information Privacy Act (BIPA) through its practices for taking passport photos. On May 4, 2023, in Daichendt and Odell v. CVS Pharmacy, Inc., the United States District Court for the Northern District of Illinois denied CVS’s motion to dismiss, holding the plaintiffs sufficiently stated a claim under Section 15(b) of BIPA. Section 15(b) of BIPA prohibits private entities from collecting “or otherwise obtain[ing] a person’s or a customer’s biometric identifier or biometric information, unless it first”: (1) provides notice of collection; (2) provides notice of the specific purpose of collection; and (3) obtains affirmative written consent. Here, the plaintiffs alleged that CVS required them to “enter[] their names, email addresses, and phone numbers into a computer terminal inside defendant’s stores prior to scanning their biometric identifiers.” Thereafter, CVS’s system would “check” and “verify” an individual’s facial features (i.e., whether the individual is smiling) to comply with government requirements. Against this backdrop, the plaintiffs argued this system violated Section 15(b) because it “collected and stored their personal contact data (‘real-world identifying information’), such as their names and email addresses,” thus allowing CVS the ability to identify the plaintiffs “when...

Are You Hallucinating? Attorneys Sanctioned for the “Unprecedented” Act of Submitting Nonexistent Case Law Provided by ChatGPT

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Posted in Technology Developments and Issues

On July 28, 2023

On June 22, 2023, District Court Judge P. Kevin Castel of the United States District Court for the Southern District of New York sanctioned a law firm after it submitted fabricated judicial citations and opinions provided by the popular artificial intelligence (AI) engine, ChatGPT. After plaintiff’s counsel filed an affirmation with the court, which was drafted by one attorney but signed by another at the same firm, defense counsel advised that he had “‘been unable to locate most of the case law cited in [the Affirmation], and the few cases which the undersigned has been able to locate do not stand for the propositions for which they are cited.’” The court “conducted its own search for the cited cases but was unable to locate multiple authorities cited in the Affirmation [].” Accordingly, Judge Castel issued an order to show cause for sanctions, emphasizing the “unprecedented circumstance” presented to the court. The court required a hearing as to whether sanctions ought to be imposed. Following submissions, it made several findings and ultimately imposed sanctions on plaintiffs’ counsel. First, Judge Castel found that the attorney who signed the Affirmation “violated Rule 11 in not reading a single case cited in his … Affirmation [] and taking no other steps on his own to check whether any aspect of...

Unintentional Consequences? The District Court of Maryland Holds Evidence Failed Rule 37(e)’s “Intent to Deprive” Requirement

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Posted in E-Discovery: Legal Decisions and Court Rules

On July 10, 2023

A recent opinion from the District Court of Maryland highlights the challenges litigants face proving intent to deprive under Rule 37(e)(2) when seeking sanctions for spoliation of electronically stored information (ESI). In Gov’t Emps. Health Ass’n v. Actelion Pharm. LTD., et al., Magistrate Judge Mark Coulson set forth the requirements to prove entitlement to remedial measures or sanctions under Rule 37(e)(1) and (2) and then applied these requirements to decide the ESI spoliation claims before the court. This blog has written extensively on what is required to trigger Rule 37(e) and resulting sanctions. In June 2017, defendant Actelion (“defendant”) was purchased by Johnson & Johnson (“J&J”). Following the acquisition, Actelion migrated its data to J&J, which managed the data of both companies. On November 19, 2018, the plaintiff filed this antitrust litigation against Actelion alleging the plaintiff was forced to pay higher prices for one of Actelion’s drugs because of the unavailability of a cheaper generic version caused by the defendant’s blocking of competition. Soon after, J&J issued a legal hold to preserve relevant information for the antitrust litigation. The defendant’s custodians included in the legal hold were determined by the defendant’s then in-house counsel (“Thompson”). Absent from the legal hold were five former defendant employees (“at-issue custodians”) with documents relevant to the antitrust litigation....

I’m Sorry, Motion Denied: Washington District Court Rejects Second Try at Class Action Suit Over Amazon Alexa’s Collection of Voice Data

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Posted in Privacy Class Actions

On June 27, 2023

In June 2022, a group of plaintiffs brought a putative class action against Amazon.com (“Amazon”) alleging the company violated several statutory and common law rights through its use of voice data collected through Alexa, its digital assistant software. After the court granted Amazon’s motion to dismiss, the named plaintiffs moved for leave to file an amended complaint. On March 29, 2023, in James Gray and Scott Horton v. Amazon.com, et. al., the United States District Court for the Western District of Washington denied the motion, concluding the plaintiff’s proposed amended complaint (PAC) failed to allege new material facts. The PAC alleged that Amazon failed to disclose to its consumers that it would use the data collected from the voice recordings made by Alexa devices for the purposes of targeted advertising. Accordingly, the plaintiffs asserted, as they had done previously, that Amazon: (1) breached the implied covenant of good faith and fair dealing; (2) violated Washington’s Consumer Protection Act (CPA) and Personality Rights Act (PRA); and (3) violated common law privacy rights. The court dismissed the plaintiffs’ implied covenant claim because the PAC “merely repeat[ed] the same arguments the Court ha[d] already rejected.” For example, the court previously rejected the plaintiffs’ argument that Amazon’s terms and conditions failed to inform them of Amazon’s use of their...

Delaware District Court Allows for Single Claim to Proceed Against Amazon in Illinois Biometric Information Privacy Act Class Action Suit

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Posted in Class Action Defense / Privacy Class Actions

On May 3, 2023

The Illinois Biometric Information Privacy Act (BIPA) is designed to protect and regulate the use of both “biometric identifiers” and “biometric information” of Illinois residents. “Biometric identifiers,” for instance, include “a retina or iris scan, fingerprint, voiceprint, or scan of hand or face geometry.” In contrast, “biometric information” means “any information … based on an individual’s biometric identifier used to identify an individual.” On March 29, 2023, in McGoveran v. Amazon Web Servs., Inc., the United States District Court for the District of Delaware granted in part Amazon Web Services (“Amazon”) and Pindrop Security’s (“Pindrop”) motion to dismiss a proposed class action brought pursuant to BIPA for lack of standing, based on a strict interpretation of the definitions of “biometric identifiers” and “biometric information” and the plaintiffs’ failure to adequately allege that they suffered any concrete, actual, or imminent injury as a result of the defendants’ conduct. In McGoveran, a group of Illinois residents alleged that Amazon and Pindrop violated BIPA by extracting their biometric information for authentication purposes when the plaintiffs called John Hancock to discuss their retirement accounts. At the outset, the court held that the plaintiffs lacked Article III standing to bring a claim under BIPA Section 15(a) and Section 15(c) or to otherwise obtain injunctive relief. Under Section 15(a), a company is...

Let’s Not Just Chat About It: District Court Sanctions Google for Failing to Preserve Chat Messages in Antitrust Suit

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Posted in General Litigation / Legal Decisions & Court Rules / Litigation Preparedness and Strategies

On May 1, 2023

In a highly anticipated opinion addressing allegations that Google failed to preserve relevant internal chat messages – despite assuring the court in a case management conference that it had – United States District Court Judge James Donato of the Northern District of California ordered Google to cover the plaintiffs’ legal costs in pursuing a Rule 37 motion and left open the possibility of the plaintiffs later pursuing nonmonetary sanctions. Judge Donato’s scathing opinion in In re Google Play Consumer Antitrust Litigation represents yet another cautionary tale for attorneys certifying that a client has taken appropriate steps to preserve all pertinent electronic discovery without providing meaningful oversight. While Judge Donato chose to focus his criticism (and ultimate sanction) on Google, he clearly was concerned with the lack of oversight and misleading representation by both Google and its attorneys. The Google cases arise from a highly publicized multidistrict litigation (MDL) involving allegations that Google Play Store’s practices were anticompetitive in violation of antitrust laws. The plaintiffs include several gaming companies, Attorneys Generals of 38 states (and the District of Columbia), and numerous consumer plaintiffs. The plaintiffs alleged that Google engaged in exclusionary conduct leading to Google monopolizing the Android app distribution market. After a long and tortured procedural history that included extensive discovery and motion practice, the...

The Federal Speak Out Act and Implications for Employers

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Posted in Employment Agreements

On January 10, 2023

In December 2022, President Biden signed into law the Speak Out Act (the “Act”), which has become effective. As discussed below, the Act prohibits pre-dispute nondisclosure and nondisparagement agreements relating to sexual assault and sexual harassment disputes. In connection with the new law, Congress presented, inter alia, the following findings: Sexual harassment and assault continue to be pervasive in the workplace. 81 percent of women and 43 percent of men experience some type of sexual harassment or assault in their lifetime. One in three women has encountered sexual harassment in the workplace, yet an estimated 87 to 94 percent of those who have experienced harassment never file any type of formal complaint. Many women leave their job or industry or pass up advancement opportunities as a result of sexual harassment. To combat sexual harassment and assault, victims must be able to report and publicly disclose such issues. Nondisclosure and nondisparagement provisions in agreements between employers and employees can allow harassment and assault to continue by silencing victims and those with knowledge of the conduct, while protecting those engaging in such conduct, thus allowing it to continue. Prohibiting nondisclosure and nondisparagement clauses will provide transparency around unlawful conduct, allow victims to come forward, hold perpetuators accountable, and make workplaces safer. Explanation of the Act The Act...

District of New Jersey Analyzes Article III Standing Requirement in the Class Action Context Under the Supreme Court’s Decision in TransUnion

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Posted in Class Action Defense / Privacy Class Actions

On November 10, 2022

In a post-TransUnion LLC v. Ramirez, 141 S. Ct. 2190 (2021) victory for the class action defense bar, the District of New Jersey has further clarified the standing requirement for showing concrete harm. In Schultz v. Midland Credit Management., Inc., the Honorable Madeline Cox Arleo, U.S.D.J. granted defendant Midland Credit Management, Inc.’s (“Midland”) motion for summary judgment because the plaintiffs failed to establish concrete harm and thus lacked standing. In Schultz, the plaintiffs filed a putative class action against Midland alleging that the collection agency issued collection letters with false Internal Revenue Service (IRS) reporting language in violation of the Fair Debt Collection Practices Act (FDCPA). Midland sent letters to the plaintiffs stating: “We will report forgiveness of debt as required by IRS regulations. Reporting is not required every time a debt is canceled or settled, and might not be required in your case.” Pursuant to the Department of Treasury and IRS regulations, Midland only needed to report discharges of indebtedness greater than $600. As the plaintiffs’ debts were below the $600 threshold, the plaintiffs argued that the IRS reporting language was false, deceptive, and misleading in violation of the FDCPA because the language implied that “there could be ‘negative consequences with the [IRS]’ and ‘deliberately fail[ed] to disclose that such reporting is required under...

Gibbons’s Frank T. Cannone and Peter J. Ulrich, Along With John Geraghty of Marshall & Stevens, to Lead Panel Discussion at NJBIA’s Acclaimed Annual Conference on New & Emerging Energy Technologies

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Posted in Corporate / Renewable Energy

On October 6, 2022

In accelerating its decarbonization goals, New Jersey has committed to cutting in-state greenhouse gas emissions in half by 2030. New and emerging technologies, including next-generation nuclear, renewable natural gas, biofuels, grid upgrades, microgrids, and more, will be critical to achieving this goal and will be the topics of discussion at the New Jersey Business and Industry Association’s (NJBIA) 2nd Annual Energy Conference on New & Emerging Technologies, taking place Friday, October 14 at the Forsgate Country Club in Monroe Township, and featuring many prominent speakers. Gibbons P.C.’s Frank T. Cannone, Chair of the firm’s Corporate Group and leader of its Renewable Energy practice, and Peter J. Ulrich, a Director in the Corporate Group, will lead a conference panel, along with John Geraghty, Managing Director in the Energy & Infrastructure Practice of Marshall & Stevens Incorporated, on “Financing New Technologies and the Inflation Reduction Act.” Gibbons’s leading Renewable Energy practice, under the Corporate Group, has been successfully completing complex client energy projects for many years. Practice attorneys counsel major energy generation organizations, industrial and commercial users, and other energy-related clients in distributed generation and alternative energy sources, including solar, battery storage, hydroelectric power generation, and wind power generation, as well as the increased use of technology in the renewable energy sector. For more information on the...

New Jersey Appellate Division Finds No Ascertainable Loss Where a Plaintiff Never Used a Product and Made Hypothetical Allegations of Loss

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Posted in Class Action Defense

On July 18, 2022

On May 31, 2022, the Appellate Division in Hoffman v. Pure Radiance, Inc. affirmed the trial court’s order granting summary judgment for a defendant and dismissing the plaintiff’s Consumer Fraud Act (CFA) claims because the plaintiff could not show that he suffered an ascertainable loss where he never used the product and his allegations were not supported by facts. In this putative class action, serial plaintiff Harold Hoffman sued defendant Pure Radiance, Inc., alleging that it falsely marketed a hair growth product. Specifically, Pure Radiance advertised that its product Re-Nourish could help an individual regrow “a thick, full head of hair, even after years of balding” and was “the world’s first and only hair loss solution that revives dead hair follicles” to regrow hair “in just 30 days.” The advertisement also showed a before-and-after picture of a man’s head, with the before picture showing a balding head and the after picture showing a full head of hair. Based on this advertisement, Hoffman purchased the product and then, after researching the product but before ever trying it himself, filed a proposed class action alleging, among other things, that the ad contained material misrepresentations and that he suffered an ascertainable loss by reason of his purchase of the product for $108.90. Significantly, Hoffman did not receive the...

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