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Frank v. Gaos
139 S. Ct. 1041
| SCOTUS | 2019
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Background

  • Plaintiffs (Gaos and others) sued Google under the Stored Communications Act (SCA), alleging Google transmitted users' search terms to visited sites via HTTP referrer headers.
  • Named plaintiffs sought to represent a class of users who clicked Google search-result links; Google moved to dismiss for lack of Article III standing multiple times.
  • The district court initially relied on Edwards ( Ninth Circuit precedent) to find a statutory violation sufficient for standing; Google withdrew its standing challenge after Edwards was dismissed for certiorari review.
  • Parties reached a classwide settlement: Google would add certain disclosures to webpages and pay $8.5 million; no payments to absent class members—most funds were allocated to cy pres recipients, fees, and costs.
  • Objectors challenged the cy pres-only settlement as unfair, unreasonable, and conflicted; the district court and a Ninth Circuit panel approved the settlement without resolving standing post-Spokeo.
  • The Supreme Court granted review of whether cy pres-only settlements satisfy Rule 23(e)(2) and—because Spokeo imposes a concreteness requirement for injury—vacated and remanded for the lower courts to resolve whether any named plaintiff has standing.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether a cy pres-only class settlement can be "fair, reasonable, and adequate" under Rule 23(e)(2) Settlement provides indirect public-benefit relief and counsel negotiated reasonable terms Settlement acceptable because it funds privacy-related organizations and provides disclosures Court did not decide merits; remanded because standing unresolved
Whether named plaintiffs had Article III standing to pursue SCA claims after Spokeo Plaintiffs relied on asserted statutory injury (disclosure of search terms) and prior district findings Google argued plaintiffs failed to allege a concrete, particularized injury post-Spokeo Court vacated and remanded for lower courts to address standing in light of Spokeo
Whether lower courts may approve class settlements without addressing jurisdictional standing of named plaintiffs Plaintiffs and lower courts treated standing as resolved earlier or waived Government and Google urged resolution of standing before settlement approval Court held it must assure Article III standing before approving class settlements and remanded for that inquiry
Whether this Court should resolve merits on cy pres adequacy now Objectors asked Court to decide and vacate approval as inconsistent with Rule 23 Respondents urged remand or resolution on the merits Court remanded for first-instance consideration of standing; expressed no view on cy pres adequacy

Key Cases Cited

  • DaimlerChrysler Corp. v. Cuno, 547 U.S. 332 (2006) (courts must assure Article III standing)
  • Friends of the Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc., 528 U.S. 167 (2000) (standing principles requiring concrete and particularized injury)
  • Simon v. Eastern Ky. Welfare Rights Organization, 426 U.S. 26 (1976) (no jurisdiction where no named plaintiff has standing)
  • Amchem Products, Inc. v. Windsor, 521 U.S. 591 (1997) (settlement terms can bear on adequacy of representation under Rule 23)
  • Cutter v. Wilkinson, 544 U.S. 709 (2005) (federal courts are courts of review, not first view)
  • Edwards v. First American Corp., 610 F.3d 514 (9th Cir. 2010) (held statutory violation alone can establish standing under Ninth Circuit precedent at the time)
  • In re Google Referrer Header Privacy Litigation, 869 F.3d 737 (9th Cir. 2017) (Ninth Circuit panel affirmed settlement approval without addressing Spokeo)
Read the full case

Case Details

Case Name: Frank v. Gaos
Court Name: Supreme Court of the United States
Date Published: Mar 20, 2019
Citation: 139 S. Ct. 1041
Docket Number: 17-961
Court Abbreviation: SCOTUS