17 June 2013

Law in Plain English: Maracich v. Spears

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

Maracich v. Spears

Several lawyers filed a class action lawsuit on behalf several car purchasers against hundreds of state car dealerships, alleging that the dealers had charged unlawful fees in violation of a state consumer protection statute.  The lawyers obtained the names and contact information of thousands of other state residents who had also paid the challenged fee from the South Carolina Department of Motor Vehicles. The lawyers wrote to the consumers, offering to talk to them about joining the class action. One of the lawyers for the car dealers found some consumers and sued the original lawyers, alleging that the solicitations violated the Driver’s Privacy Protection Act. The DPPA has a "litigation exception" which allows use of personal data “in connection with any civil...proceeding in any Federal, State, or local court...including...investigation in anticipation of litigation;” and a "solicitation" exception which allows use of the information “[f]or bulk distribution for surveys, marketing or solicitations...if the State has obtained the express consent of the person to whom such personal information pertains.” The Fourth Circuit agreed with the original lawyers that their use of the DPPA data fell within the litigation exception and dismissed the lawsuit. The question before the Court was whether the litigation exception applied to the original lawyers when they obtained, disclosed, or used personal information solely to find clients to represent in their class action (the solicitation exception didn't apply, because both sides conceded that the lawyers didn't have the consent of their parties). In a 5-4 decision, the Supreme Court ruled that an attorney’s solicitation of clients is not a permissible purpose covered by the (b)(4) litigation exception. As a result, the class action lawsuit fails. The practical impact of this decision is that courts will have to limit the scope of the litigation exception to exclude client solicitation.
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