Source: http://www.techlawjournal.com/alert/2007/02/27.asp
Timestamp: 2019-04-19 05:13:36+00:00

Document:
TLJ Daily E-Mail Alert No. 1,544, February 27, 2007.
February 27, 2007, Alert No. 1,544.
2/20. The U.S. District Court (DC) issued a Memorandum Opinion [17 pages in PDF] in Randolph v. ING Life Insurance and Casualty Company, a case regarding standing to sue for lost data.
Summary. The District Court held that it lacks jurisdiction over a purported class action against an insurance company alleging invasion of privacy and negligence in connection with the loss of a laptop computer containing personal information.
The District Court held that the plaintiffs lack standing because they failed to allege in their complaint a cognizable injury in fact.
The opinion suggests that actual identity theft would be an injury in fact, but that increased likelihood of becoming a victim of identity theft is not injury in fact. The plaintiffs in this case only alleged the latter.
The District Court's ruling is based upon its application of Article III, Section 2, of the Constitution, which provides that "The judicial Power shall extend to all Cases ... Controversies ..."
There are now several recent federal District Court opinions holding that injury in fact must be alleged in a lost data case.
It should also be noted that this is a lost laptop case, and that the main case relied upon by the District Court was similar in nature. The outcome might have been different if this had been a targeted data theft case. In this case a house burglar stole an employee's laptop. There is no allegation that the laptop was targeted for its data. Perhaps this should be contrasted with cases in which identity thieves, or criminal data brokers, steal for the purpose of obtaining personal data for illegal uses.
Background. ING Life Insurance and Casualty Company (ING), among other things, provides investment advice, administrative services, and record keeping to participants in the District of Columbia 457 Deferred Compensation Plan.
Regina Randolph and six other individual plaintiffs are current or former District of Columbia employees and participants in the plan. Two are currently police officers. The plaintiffs provided personally identifying information, including names, addresses and social security numbers, to ING.
A laptop computer containing their personal information was stolen from the home of an ING employee. ING disclosed the theft.
The District Court wrote that the "Plaintiffs do not allege that the burglary was anything other than a common burglary or that it was undertaken for the purpose of accessing Plaintiffs' Information." It added that "none of the Plaintiffs assert that they have actually been the victim of identity theft. Instead, Plaintiffs allege that the disclosure of their Information raises concerns about Plaintiffs' safety because, for example, Plaintiffs' Information could be used to find out where police personnel live."
The plaintiffs alleged in their complaint that they "have been exposed to a risk of substantial harm and inconvenience".
Randolph and six others filed a complaint in the Superior Court for the District of Columbia alleging two counts of invasion of privacy, one count of gross negligence, and one count of negligence. The complaint did not plead breach of fiduciary duty. The plaintiffs seek class action status. ING removed the action to the U.S. District Court (DC).
ING sought dismissal pursuant to Federal Rule of Civil Procedure (FRCP) 12(b)(1) and 12(b)(6). FRCP 12(b)(1) pertains to "lack of jurisdiction over the subject matter", while FRCP 12(b)(6) pertains to "failure to state a claim upon which relief can be granted".
District Court Opinion. The District Court remanded the case to the Superior Court pursuant to FRCP 12(b)(1). The District Court did not address the merits of the FRCP 12(b)(6) motion.
The court relied on the leading Supreme Court cases, including Allen v. Wright, 468 U.S. 737 (1984) and Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992), for general principles of standing.
The District Court reasoned that "As an Article III court, this Court's judicial power is limited to adjudicating actual ``cases´´ and ``controversies.´´" The District Court wrote that the case or controversy requirement encompasses the principle of standing, and that standing is an "irreducible constitutional minimum".
It continued that to satisfy the standing requirements, a plaintiff must establish that he or she has (1) suffered an injury in fact, an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical, (2) which is fairly traceable to the challenged act, and (3) is likely to be redressed by a favorable decision.
It added that to ground Article III standing, the injury alleged cannot be conjectural or hypothetical, remote, speculative, or abstract. It must be certainly impending.
The District Court added that purchase of credit monitoring services, or other protection efforts, is not injury in fact either.
Also, while the plaintiffs did not plead breach of fiduciary duty, the District Court added that even if they had, they would still lack standing for failure to plead injury of fact.
This is a District Court opinion. There have also been several other recent District Court opinions (which are cited in the Memorandum Opinion) that have held that injury in fact is a prerequisite for standing in lost data cases. However, the Appeals Courts have yet to address this issue.
In addition, because this case was previously removed from the Superior Court for the District of Columbia to the District Court, and the District Court found that it lacks jurisdiction, it remanded the case to the Superior Court, rather than dismiss it. The case returns to the Superior Court, where the plaintiffs originally filed the case.
Article III defines the jurisdiction of the federal courts, not the state courts. However, the District of Columbia is not a state, and the Constitutional principles of standing apply in the Superior Court. Thus, if the Superior Court applies the Constitutional principles of standing in the same way as the District Court, it will dismiss. But then, different judges do not always apply the same principles in the same way.
ING is represented by Alan Charles Raul, Juan Morillo, and Stephen Nickelsburg of the Washington DC office of the law firm of Sidley Austin.
This case is Regina Randolph, et al. v. ING Life Insurance and Casualty Company, U.S. District Court for the District of Columbia, D.C. No. 06-1228 (CKK), Judge Colleen Kotelly presiding.
The House will meet at 2:00 PM for legislative business. It will consider several non-technology related items under suspension of the rules. Votes will be postponed until 6:30 PM. See, Rep. Hoyer's weekly calendar.
The Senate will meet at 10:00 AM for morning business. At 2:15 PM it will resume consideration of the motion to proceed to S 184, the "Surface Transportation and Rail Security Act of 2007".
5:00 PM. The House Rules Committee will meet to adopt a rule for consideration of HR 556, the "National Security Foreign Investment Reform and Strengthened Transparency Act of 2007", a bill pertaining to the Committee on Foreign Investment in the United States (CFIUS) process. Location: Room H-313, Capitol Building.
The House will meet at 10:00 AM for legislative business. It will consider HR 556, the "National Security Foreign Investment Reform and Strengthened Transparency Act of 2007", a bill pertaining to the Committee on Foreign Investment in the United States (CFIUS) process. See, Rep. Hoyer's weekly calendar.
9:30 AM. The Consumer Electronics Association (CEA) will host a news conference regarding transitioning to digital television. The CEA's notice states that participants will announce a "comprehensive consumer education campaign to increase awareness of the nation’s transition to digital television, which will be completed on February 17, 2009". To participate by teleconference, call 877-829-1022. For more information, contact Megan Pollack at mpollock at ce dot org or 703-907-7668. Location: Zenger Room, National Press Club, 13th Floor, 529 14th St., NW.
10:00 AM. The House Appropriations Committee's (HAC) Subcommittee on Financial Services will hold a hearing on the "Consumer Issues". The witnesses will be Deborah Majoras (FTC Chairman), Nancy Nord (acting Chairman of the Consumer Product Safety Commission), Janell Duncan (Consumers Union), Rachel Weintraub (Consumer Federation of America), and Ari Schwartz (Center for Democracy and Technology). Location: Room 2220, Rayburn Building.
10:00 AM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice, Science will hold a hearing on the National Science Board (NSB). The witness will be Steven Beering (NSB Chairman). Location: Room 2359A, Rayburn Building.
10:00 AM. The House Science Committee will meet to mark up several bills, including HR 1068, a bill to amend the High-Performance Computing Act of 1991. Location: Room 2318, Rayburn Building.
2:00 PM. The House Commerce Committee's (HCC) Subcommittee on Telecommunications and the Internet will hold a hearing titled "H.R. 251, the Truth in Caller ID Act of 2007". The Subcommittee may also mark up the bill at the conclusion of the hearing. See, HR 251. Location: Room 2322, Rayburn Building.
2:00 PM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice, and Science will hold a hearing titled "Overview of Science Funding". The witnesses will be Norman Augustine (former Ch/CEO of Lockheed Martin) and Alan Leshner (CEO of the American Association for the Advancement of Science). Location: Room 2359A, Rayburn Building.
3:00 PM. The House Judiciary Committee's (HCC) Antitrust Task Force will hold a hearing titled "Competition and the Future of Digital Music". This hearing will examine the proposed XM Sirius merger. See, notice and release. Location: Room 2141, Rayburn Building.
The House will meet at 10:00 AM for legislative business. It will consider HR 800, a bill for the benefit of labor unions. See, Rep. Hoyer's weekly calendar.
10:00 AM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice and Science will hold a hearing on the National Science Foundation (NSF). The witness will be Arden Bement. Location: Room 2237, Rayburn Building.
LOCATION CHANGE. 10:00 AM. The Senate Judiciary Committee (SJC) may hold a business meeting. The agenda includes consideration of S 236, the "Federal Agency Data Mining Reporting Act of 2007", and S 316, the "Preserve Access to Affordable Generics Act", a bill to prohibit brand name drug companies from compensating generic drug companies to delay the entry of a generic drug into the market. The agenda also includes consideration of several judicial nominees: Thomas Hardiman (to be a Judge of the U.S. Court of Appeals for the 3rd Circuit), John Preston Bailey (U.S.D.C., Northern District of West Virginia), Otis Wright (U.S.D.C., Central District of California), and George Wu (U.S.D.C., Central District of California). The SJC rarely follows its published agendas. Press contract, Tracy Schmaler (Leahy) at 202-224-2154 or Courtney Boone (Specter) at Courtney_Boone at judiciary-rep dot senate dot gov or 202-224-2984. See, notice. Location: Room S-216, Capitol Building.
TIME CHANGE. 12:00 NOON - 3:00 PM. The Progress and Freedom Foundation (PFF) will host an event titled "Universal Service Reform: Are Reverse Auctions the Answer?". The speakers will be Shyamal Ghosh (former Director of the Indian Department of Telecommunications), Paul Milgrom (Stanford University), Vernon Smith (George Mason University), and Dennis Weller (Chief Economist of Verizon). See, notice. Lunch will be served. Location: Oriental Ballroom B, Mandarin Oriental Hotel, 1330 Maryland Ave., SW.
10:30 AM (or 15 minutes after the conclusion of a full Committee markup scheduled for 10:00 AM). The House Commerce Committee's (HCC) Subcommittee on Telecommunications and the Internet will hold a hearing titled "Digital Future of the United States: Part I -- The Future of the World Wide Web". Location: Room 2123, Rayburn Building.
12:00 PM. Secretary of the Treasury Henry Paulson will give a speech on trade at an event hosted by the Economic Club of Washington (ECW). See, Treasury notice. Press contact: Judi Irastorza (ECW) at pcom2 at cox dot net or 703-765-6881. Location: Renaissance Mayflower Hotel, Grand Ballroom, 1127 Connecticut Ave., NW.
Rep. Hoyer's weekly calendar [PDF] states that "No votes are expected in the House."
12:00 NOON - 1:30 PM. The Federal Communications Bar Association's (FCBA) Cable Committee will host a brown bag lunch titled "The Future of Program Access Regulation". For more information, contact Daphney Sheppard at dsheppard at sidley dot com or 202-736-8019. Location: Sidley Austin, 6th floor, 1501 K St., NW.
12:00 NOON - 1:30 PM. The U.S. Chamber of Commerce (USCC) will host an event titled "Sarbanes-Oxley: Costs, Benefits, and the Ongoing Debate". For more information, contact Henrietta Treyz at 202-463-5864 or htreyz at uschamber dot com. See, notice. Location: Room 2158 (Gold Room), Rayburn Building, Capitol Hill.
Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Further Notice of Proposed Rulemaking (FNPRM) in its TV white space proceeding. This FNPRM is FCC 06-156 in ET Docket Nos. 04-186 and 02-380. The FCC adopted this item at an October 12, 2006, meeting, and released it on October 18, 2006. See, story titled "FCC Adopts Order and FNPRM Regarding TV White Space" in TLJ Daily E-Mail Alert No. 1,467, October 12, 2006, and notice in the Federal Register, November 17, 2006, Vol. 71, No. 222, at Pages 66897-66905.
10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Cellco Partnership v. Broadcom, App. Ct. No. 2006-1514. Location: Room 201, 717 Madison Place, NW.
10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Motionless Keyboard v. Microsoft, App. Ct. No. 2006-1497, an appeal from the U.S. District Court (DOr) in a patent infringement case affecting, among other things, Microsoft's joy sticks and game controllers. The District Court granted defendants' motions for summary judgment of non-infringement and invalidity and entered final judgment in their favor on May 9, 2005. Then, the inventor, who is also the largest shareholder of Motionless Keyboard, moved to intervene pro se. On June 8, 2006, the Court of Appeals issued its opinion [PDF] affirming the District Court's denial of the motion to intervene. Location: Room 203, 717 Madison Place, NW.
Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to Locus Telecommunications, Inc.'s petition for a declaratory ruling that calls to a prepaid calling card provider’s toll-free customer service numbers are not subject to payphone compensation or, in the alternative, to initiate a rulemaking. See, Public Notice [3 pages in PDF] (DA 07-513). This is proceeding is RM 11354.

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