Over the past decade, it has become increasingly clear what a hold technology – particularly social media – has over our lives. It’s also becoming clear how much power is given to those who control those platforms. When that oversized influence leads to negative consequences for consumers, consumer protection litigators like Victoria Nugent are ready to fight back.
Nugent is a partner at plaintiffs’ firm Cohen Milstein, where she serves as co-chair of the Consumer Protection practice group and recent past co-chair of the Public Client practice group. She currently focuses on class actions targeting Fortune 500 companies, litigating cases against corporations like Ford, General Motors, Marriott and Meta, or Facebook. Nugent is particularly focused on the ever-growing impact of data sharing and control in Big Tech. The practice group she leads is now litigating its fourth recent case against the company, after achieving a $40M settlement in an Unfair Competition Law case in June 2020. Nugent says the question at the core of her Big Tech consumer protection cases is, “How do you manage something that’s so core to our social, political and economic infrastructure, but held in private hands?”
Nugent’s practice began in the public client sphere with non-profit consumer rights group Public Citizen, where she spent the first seven years of her practice. At Cohen Milstein’s public client practice group, Nugent represented numerous states and their constituents in cases involving deceptive opioid marketing, improper foreclosures, and investigations into deceptive and irresponsible lending.
Lawdragon: How did you first become interested in consumer protection law?
Victoria Nugent: It all started at Public Citizen and my first job there as a new college graduate. There I learned that “consumer protection” is really a movement dedicated to building – or perhaps preserving – an economic system based on fairness, transparency and decency. We’re all consumers – sometimes by choice, but often out of necessity. That commitment has been foundational to my career, in which I’ve had the privilege of vindicating consumer rights in class actions and on behalf of public clients.
LD: What have you found most satisfying about fighting for consumers?
VN: The work delivers benefits to individuals and households while making an impact on a systemic level. Consumer protection litigation, particularly class actions, play an important role in shaping and improving conduct at the systemic level – changing corporations and industries.
As a public client attorney, I had the privilege of litigating several portfolios of cases with state attorneys general. Most recently, I represented Indiana, New Jersey and Vermont in litigation against opioid manufacturers and distributors. These cases and related investigations will result in more than $1B going to those states from settlements involving three major pharmaceutical distributors, Cardinal Health, McKesson and AmerisourceBergen, opioids manufacturers including Johnson & Johnson, and others.
LD: How did you start out doing work with public clients?
VN: My first foray into public client work – more than a decade ago – grew out of a financial crisis with terrible consequences for household stability and retirement savings: the mortgage foreclosure crisis. I represented the states of Nevada and Arizona in investigations and litigation into several of the country’s largest investment and retail banks and their alleged roles in the predatory lending and improper loan servicing practices that fueled the foreclosure crisis.
Now, as the co-chair of Cohen Milstein’s Consumer Protection practice, I’m involved in a host of class actions against Fortune 500 companies including Facebook, Ford, General Motors, Marriott, MGM Resorts – cases that should have a significant impact on how these companies do business with their customers in the future.
'Consumer protection' is really a movement dedicated to building – or perhaps preserving – an economic system based on fairness, transparency and decency.
I’m delighted to report that my team has had a tremendous winning streak in the last 15 months – for which I do not take credit but do celebrate. We’ve had three major class certification rulings – against Facebook and Luxottica (LensCrafters) in false advertising and unfair business practices class actions and against Marriott International in one of the largest data breach class actions to date.
LD: Congratulations on those successes.
Looking at those more recent cases, are there any trends you are seeing in your practice?
VN: Great question. I’ve been thinking a lot about this.
Consumer protection is a dynamic area of the law. The type of harm and misconduct that we come across is always changing, especially with the rise of the digital economy, Big Data and social media. The rules of commercial enterprise have been re-written to some extent, and the law has struggled to keep pace.
We are at a significant inflection point in our history and the growth of our economy. Social media platforms play a central role not just in commercial enterprise, but also in our political and social life – very similar to the railroads of the 19th and early 20th century. While privately held railroads were the infrastructure that allowed for the rapid expansion and development of this country and fortunes were made, people and small businesses were often exploited.
The issue of regulating new industry and technology that they faced then is similar to the dilemma we are facing now with Big Tech. “How do you manage something that’s so core to our social, political, and economic infrastructure, but held in private hands?”
LD: How can consumer protection litigations help answer that question?
VN: Industry has always been resistant to regulation, and the advancement of technology today outpaces government’s ability to regulate it with specificity. So, it’s critical for private litigants and the civil justice system to hold Big Tech accountable for the harms they cause – whether it’s unfair business practices, antitrust violations, discrimination perpetuated through their platforms or unauthorized use of personal data.
Adjacent to the challenges of policing Big Tech’s business dealings with consumers, smaller businesses and tech startups is the question of how to remedy the damage social media platforms are doing to public health and participation in public life. I don’t have the answer on how Section 230 of the Communications Decency Act should be re-written, because there are important and competing considerations that must be balanced. But it is shocking to consider that companies like Facebook, Twitter and YouTube derive revenue from the divisive, inflammatory, and untrue content published on their platforms and yet haven’t faced any liability – or even examination of potential liability – for some shocking events organized using those platforms. So, it will be interesting to see what happens at the Supreme Court with Gonzalez v. Google and if Congress can or will do its job and modernize Section 230 to meet this moment.
LD: Are there any other issues related to Big Tech that consumers should be aware of?
VN: Data appropriation is another issue we’re watching. Data brokers are largely unregulated and consumer-facing companies – retailers, banks, news, and social media platforms – are selling and trading customer data to third parties that are using it in ways that are unforeseen and not understood by consumers. Commentators have called data “the oil of the 21st century,” and the comparison is apt. Anticompetitive behavior in the oil and rail industries gave rise to landmark antitrust legislation, so I am hopeful that we will be able to harness social media platforms and the metaverse for good.
I am also watching the automobile industry with great interest. Cars today are engineered to provide tremendous protection to vehicle occupants and to avoid crashes. Between 1980 and 2010, fatality rates dropped by 50 percent. Over the last 8 years, the rates have started creeping back up – in part because of distracted driving. Self-driving vehicles may be another area where technology will outpace government regulation, and this technology will presents lots of risks if it isn’t regulated.
Self-driving vehicles may be another area where technology will outpace government regulation, and this technology will presents lots of risks if it isn’t regulated.
The intersection of cars and data is interesting to contemplate. I was at a conference five years ago where an engineer speculated that at some point the data collected by our cars would be so valuable that vehicle sales might be considered a loss-leader. I have no idea whether that will ever come to pass – it seems hard to imagine – but the prediction certainly says something about data as currency.
LD: Can you talk a bit about cases you’re handling at the moment and how they exemplify some of those current, vital issues?
VN: We’re currently handling a wrongful death case against Facebook called Underwood Jacobs v. Meta Platforms.
It’s a tragic story. On May 29, 2020, Department of Homeland Security Officer Dave Patrick Underwood was providing security at the federal courthouse in Oakland, Calif., during the Black Lives Matter and George Floyd protest. According to documents filed in federal criminal proceedings, Officer Underwood was the victim of a drive-by shooting by two men who identified as boogaloo adherents, part of an extremist movement that advocates targeted violence against the government and government personnel.
The lawsuit alleges that this shooting was not a random act of violence. Rather, it was the culmination of an extremist plot hatched and planned on Facebook by two men who connected in a Facebook boogaloo group.
Criminal proceedings revealed that the two men connected through a boogaloo Facebook group on May 28, 2020, after one posted a YouTube video to the group showing a large crowd violently attacking two California Highway Patrol vehicles, writing: “It’s on our coast now, this needs to be nationwide. It’s a great opportunity to target specialty soup bois [a known term for federal law enforcement officers]. Keep that energy going.” The other man allegedly responded to that post in agreement: “Let’s boogie.” The DOJ also alleged that the two men agreed to meet on May 29 and drive together to the protests in Oakland.
We’ve alleged that Facebook’s algorithms promote inflammatory content and groups as a way to engage users and keep them active, which in turn drives ad sales and revenue. Former employees and internal company documents have made clear that Facebook knows it is promoting inflammatory and divisive speech and that it is directing users – which we say is tantamount to recruiting – toward extremist groups on the platform. Given the information brought to light by Facebook whistleblower Frances Haugen in 2021, we believe that our allegations show that Facebook played a role in the creation and development of extremist content on the platform and therefore is not immune from suit under Section 230. But this question may be illuminated further by the Supreme Court in 2023 when it takes up Section 230 immunity in Gonzalez v. Google.
LD: What are the most challenging aspects of bringing a case against an entity like Facebook?
VN: The Underwood case is one of four cases we have been litigating against Facebook (or Meta, as they are calling themselves these days), and while Underwood is still in the early stages of litigation, I’ll speak to this question more generally.
Briefly, Meta is a massive, sophisticated, and well-defended company. It has extraordinary financial resources, and that means that it can hire legal teams to aggressively defend its interests and explore every avenue of potential defense. So, going up against them in any litigation is likely to be a long, drawn-out, and contentious fight, particularly when it comes to discovery.
Discovery in any litigation can be challenging. Litigating against Big Tech is a whole other level. As a start, defense counsel will routinely tell the court that the technology or business model – particularly where it is based on coding – in dispute is “highly complex” or “more complex than plaintiffs’ counsel states” in an attempt to persuade the court to summarily dismiss plaintiffs’ arguments. Such posturing requires three things of plaintiffs’ counsel: a talented and persistent legal team, computer scientists as experts, and a lot of education to orient the court or jury on the technology or business model in dispute and how it harms consumers.
Commentators have called Big Data 'the oil of the 21st century,' and the comparison is apt.
In two of the cases against Facebook I referenced earlier – both before the Northern District of California – we have persisted and prevailed.
We were co-lead class counsel in LLE One, LLC v. Facebook, in which plaintiffs, U.S.-based Facebook advertisers, asserted that Facebook violated California’s Unfair Competition Law by misleading them about viewer engagement of video ads by using inflated video-viewing metrics. Plaintiffs further alleged that Facebook committed fraud because it knew about the issue but did nothing to correct it and went out of its way to hide it. In June 2020, the court granted final approval of a $40M settlement in this case.
In the second case, DZ Reserve v. Facebook, another advertising metrics case involving complex algorithms, the court certified a class of Facebook advertisers to pursue fraud claims in March of this year. Plaintiffs claim that Facebook’s key advertising metric is false and misleading due to the impact of fake and duplicate accounts.
Our most recent case, In re Meta Pixel Healthcare Litigation, involves Facebook’s alleged collection and transmittal of protected health information through the Facebook pixel that Facebook has made available to hundreds of hospitals and health care providers that use patient portals and online appointment scheduling applications.
LD: How does taking on these cases impact not only your clients, but the industry at large?
VN: I can think we all agree on the economic and social benefits of internet commerce and social media in uniting people and making information and products more readily accessible. But at this juncture in history, these massive for-profit tech corporations have an almost monopolistic power over particular activities on the internet and an outsized influence in shaping public information, news and reality.
The civil justice system provides one set of tools to keep these companies in check. At the end of the day, my number one objective, and that of my partners, is to seek justice and compensation for damages, injury, or any other losses our clients incur. Our ability to develop novel claims and cutting-edge damage theories in class actions is allowing us to break new ground in the digital era.