TikTok data breach class action dropped over cost fears

high court2TikTok has managed to swerve a potentially damaging High Court data protection class action after former children’s commissioner for England Anne Longfield has decided to withdraw her legal action, citing the financial risks for the parents of those involved.

Longfield, who served as commissioner between March 2015 and February 2021, filed the lawsuit in August last year on behalf of millions of children in the UK and EU who have used TikTok since March 25 2018.

The legal claim alleged that TikTok takes children’s personal information without sufficient warning, transparency, or necessary consent required by law, and without parents and children knowing what is being done with their private information. Longfield maintained that more than 3.5 million children in the UK alone could have been affected.

At the time, it was alleged that TikTok could be liable to pay compensation of between £1.7bn and £5.1bn.

However, it seems that last November’s landmark Supreme Court ruling on a £3bn data protection claim against Google – dubbed Lloyd v Google – has put the kibosh on Longfield’s class action, just weeks before the court was due to hear TikTok’s application for summary judgment.

Earlier this month, TikTok lawyers had argued that the Lloyd ruling – which has already led to the withdrawal of two similar claims, one against YouTube and another against Google and DeepMind Technologies over an arrangement with the Royal Free London NHS Foundation Trust – poses “insuperable hurdles to the claim proceeding”.

Longfield said: “Regrettably, we have had to withdraw our case against TikTok following concerns about the financial risks of the claim.

“The Supreme Court’s decision in Lloyd v Google has created an enormous amount of legal uncertainty around privacy class actions, and this unfortunately proved too great a risk for the funders and insurers in this case. Without funders and insurers, we cannot protect parents of affected children from bearing the financial burden of the case.”

Data protection lawyers had predicted as much when the Supreme Court made its findings public in November.

At the time, Gareth Oldale, head of data privacy and cybersecurity at UK law firm TLT, said that one of the key factors in the Lloyd case was the question of whether or not a uniform sum of damages can be awarded to each member of the represented class without the need to prove any facts particular to that individual.

He added: “Are damages payable in a case where the claimant does not prove either what unlawful processing of personal data occurred or that the individual suffered material damage or mental distress – is ‘loss of control’ of the data sufficient to give rise to damages being payable? The Supreme Court has resoundingly concluded that this approach is ‘unsustainable’.”

Other experts believed the ruling could lead to change in the law, under the Government’s Data: A New Direction reforms.

Mishcon de Reya partner Adam Rose said: “The judgment passes the baton both to Parliament and to the Information Commissioner. For Parliament, it may be the case that legislation is required to enable opt-out claims under data protection law to be made more easily.”

Last week, the DMA urged ministers to reveal the details of the reforms, amid claims that the data-driven marketing industry was “in limbo”.

And in response to a written Parliamentary question on when the new data rights will be clarified by the Data Reform Bill, Digital Minister Julia Lopez said this week: “Now that we have left the EU, we have an opportunity to simplify the clunky parts of GDPR and create a world class data rights framework that will allow us to realise the benefits of data use while maintaining the UK’s high data protection standards.

“The bill will contain measures from the ‘Data: A New Direction’ consultation document, and we will publish our response shortly. The bill will also make good on the Government’s commitment to legislate for other policies in similar subject areas, such as increasing industry participation in Smart Data schemes and enabling digital identity-verification services.”

How soon is “soon” remains to be seen.

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