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Patel v. Facebook Inc. - 290 F. Supp. 3d 948 (N.D. Cal. 2018)

Rule:

Federal courts are courts of limited jurisdiction, and the "case or controversy" requirement of Article III of the U.S. Constitution "limits federal courts' subject matter jurisdiction by requiring, inter alia, that plaintiffs have standing."

Facts:

This consolidated action originated as three separate cases originally filed in Illinois courts. Two of the cases were filed in federal court, while a third was filed in Illinois state court and removed to federal court by Facebook under the Class Action Fairness Act. The parties stipulated to transfer the cases to the federal district court in the Northern District of California, where they were consolidated into a single action.

The consolidated complaint alleges that Facebook "operates the largest social network in the world, with over one billion active users.". The named plaintiffs, Nimesh Patel, Adam Pezen and Carlo Licata, use Facebook "to, among other things, upload and share photographs with friends and relatives." Plaintiffs' claims arise out of Facebook's "Tag Suggestions" program launched in 2010. A user "tags" other Facebook users and non-users by identifying them in photographs uploaded to Facebook. "Tag Suggestions" scans uploaded photographs "and then identif[ies] faces appearing in those photographs." Tag Suggestions uses "state-of-the-art facial recognition technology" to extract biometric identifiers from photographs that users upload, when Facebook then creates and stores digital representations of people's faces.

Plaintiffs allege that Facebook collected users' biometric data secretly and without consent. Specifically, they allege that the Tag Suggestions program violated the Illinois Biometric Information Privacy Act, 740 Ill. Comp. Stat. 14/1 et seq. (BIPA) because Facebook did not: "[1] properly inform plaintiffs or the class in writing that their biometric identifiers (face geometry) were being generated, collected or stored; [2] properly inform plaintiffs or the class in writing of the specific purpose and length of time for which their biometric identifiers were being collected, stored, and used; [3] provide a publicly available retention schedule and guidelines for permanently destroying the biometric identifiers of plaintiffs and the class (who do not opt-out of 'Tag Suggestions'); and [4] receive a written release from plaintiffs or the class to collect, capture, or otherwise obtain their biometric identifiers." Plaintiffs seek declaratory and injunctive relief and statutory damages. Facebook requested the court to dismiss the case under Federal Rule of Civil Procedure 12(b)(1) on the ground that plaintiffs have failed to allege a concrete injury in fact.

Issue:

Should Facebook's motion to dismiss for lack of subject matter jurisdiction be denied?

Answer:

Yes.

Conclusion:

Federal courts are courts of limited jurisdiction, and the "case or controversy" requirement of Article III of the U.S. Constitution "limits federal courts' subject matter jurisdiction by requiring, inter alia, that plaintiffs have standing." As the Supreme Court recently reiterated, a plaintiff must demonstrate standing to sue by alleging the "irreducible constitutional minimum" of (1) an "injury in fact" (2) that is "fairly traceable to the challenged conduct of the defendants" and (3) "likely to be redressed by a favorable judicial decision." These requirements may not be abrogated by Congress. The specific element of injury in fact is satisfied when the plaintiff has "suffered 'an invasion of a legally protected interest' that is 'concrete and particularized' and 'actual or imminent, not conjectural or hypothetical.'" 

To determine whether an injury in fact has been demonstrated, the United States Supreme Court has held that both history and the judgment of Congress play important roles. History is instructive because an intangible harm is likely to be concrete for standing purposes when it bears "a close relationship to a harm that has traditionally been regarded as providing a basis for a lawsuit." Congress's judgment is particularly important because it is "well positioned to identify intangible harms" that are in fact concrete for Article III purposes. Consequently, an intangible harm such as "the violation of a procedural right granted by statute can be sufficient in some circumstances to constitute injury in fact. In other words, a plaintiff in such a case need not allege any additional harm beyond the one Congress has identified."

The court concluded that state statutes, which constitute state law, can create such interests. While state law cannot create Article III standing where none exists under federal precedent, the judgment of a state legislature should not be treated as less important than that of Congress in deciding when the violation of a statutory grant in itself amounts to a real and concrete injury. The dispositive inquiries are whether: (1) the statutory provisions at issue were established to protect the plaintiff's concrete interests; and (2) the specifically alleged procedural violations "actually harm or present a material risk of harm" to those interests.

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