In a refreshingly plain-spoken opinion issued Aug. 6, a three-judge panel of the Third Circuit Court of Appeals criticized a multimillion-dollar class action settlement in litigation over Google’s unauthorized use of internet tracking “cookies,” remanding to the District Court for more detailed findings of fact. In re: Google Inc. Cookie Placement Consumer Privacy Litigation, No. 17-cv-1480 (3d Cir. Aug. 6, 2019).
The case arose from allegations that Google created a web browser cookie, which tracks an internet user’s browsing activity even if the user tries to configure privacy settings to block it. The parties reached a settlement that would require Google to “stop using the cookies for Safari browsers and to pay $5.5 million to cover class counsel’s fees and costs, incentive awards for the named class representatives, and cy pres distributions, without directly compensating any class members.” The District Court certified an injunctive relief-only settlement class under Rule 23(b)(2), notwithstanding the fact that the settlement purported to release all class members’ potential claims for money damages. The only monetary benefit to the class was tangential: Google was to pay $3 million to organizations devoted to advocating for online privacy – a mechanism commonly referred to as cy pres, meaning a distribution that is supposed to be “as near as possible” to direct monetary relief.