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Today, data breaches continue to proliferate at a rapid pace, often spurring consumer class action litigation in their wake. Oftentimes, a successful data breach suit can empty a corporate defendant’s coffers. For example, Equifax was recently forced to shell out $575 million to settle a major data breach class action suit stemming from its 2017 mega-breach that impacted over 100 million individuals. Consequently, companies that handle consumer personal data must be prepared to forcefully defend such high-stakes, bet-the-company litigation.
Fortunately, Article III standing serves as a viable defense to obtain dispositive dismissals from a wide range of data breach class actions in federal court. While a current circuit split exists over the threshold for establishing standing in such cases, the standard articulated by the Sixth Circuit Court of Appeals provides a significant opportunity for defendants to completely dispose of litigation at the pleading stage based on an absence of constitutional standing.
Originally published in the January/February 2021 edition of CBA Report.
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