US Supreme Court ponders if lawyers can use records to find clients

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The justices of the U.S. Supreme Court are trying to dissect the language of a poorly worded federal statute that protects drivers’ personal information from misuse in an effort to determine whether lawyers broke the law in looking for potential class action plaintiffs.

“What a mess this statute is,” Justice Elena Kagan said of the Driver’s Privacy Protection Act during oral arguments Wednesday in Maracich v. Spears.

The case involves South Carolina lawyers who brought class actions in state court against several car dealerships, alleging that they had collected unlawful fees from car buyers.

By sending a Freedom of Information Act request to the South Carolina Department of Motor Vehicles, the lawyers obtained names, addresses, telephone numbers, car purchase information and other personal data to identify potential plaintiffs in the action.

Two individuals contacted by the attorneys brought a putative class action against the lawyers alleging violation of the federal Driver’s Privacy Protection Act.

The parties filed cross motions for summary judgment. The drivers alleged that the lawyers’ use of DPPA-protected data to solicit individuals without their permission constituted liability as a matter of law, while the attorneys argued that the use of the information was permissible under the “litigation exception” to the Act’s general prohibition.

The district court granted summary judgment in favor of the lawyers. The 4th Circuit affirmed, finding that the use fell within the litigation exception to the law.

The drivers filed a petition for certiorari, which was granted by the Supreme Court.

‘Bulk solicitation’

Joseph Guerra, a partner in the Washington office of Sidley Austin, argued on the drivers’ behalf that the statute’s litigation exception was not intended to cover the kind of “bulk solicitation” involved in this case.

Justice Anthony M. Kennedy pointed out that the litigation exception extends to both ongoing and potential litigation.

“The whole essence of the class action is you have to see if there is an injury that goes beyond some particular clients that you know,” Kennedy said. “Isn’t this investigation in anticipation?”

Guerra said if the lawyers “had limited their activities [to] determining the scope of the potential claims, we’d have no quarrel with that.”

“Well, the anticipation is: are you willing to join the class?” Kennedy said. “Isn’t that critical?”

“No, Justice Kennedy, I don’t think so,” Guerra said.

Justice Sonia M. Sotomayor also tried to define the line between lawful inquiries and unlawful solicitation.

“If the lawyer had [asked the drivers,] ‘Did you buy a car? Did you get charged the fee? We’re investigating this to determine whether this violates the law.’ Is that okay?”

Guerra said it was.

“So the only thing that’s bad to say is, ‘Come call us for a consultation?’” Sotomayor asked.

Guerra said argued that the litigation exception applies to finding information related to a lawsuit, not finding potential clients.

Kagan tried to make the argument fit in the text of the statute.

“Mr. Guerra, I understand the distinction,” Kagan said, “but, boy, it’s hard to get that from the words here.”

Guerra tried to break it down.

“The question you have to ask yourself is, in light of [Congress’ intent to] stop use of DMV information for non-consensual solicitations, is it reasonable to think that this clause authorizes lawyers to … find and solicit clients? And I submit it is not.”

Cradle-to-grave coverage?

Paul D. Clement, a partner in the Washington office of Bancroft, began his argument on the lawyers’ behalf by acknowledging the law’s oddness.

“The DPPA is an unusual statute,” Clement said. “It directly regulates the state’s use of [its] own databases and imposes massive civil liability and criminal penalties for violations.”

He went on to say that was the reason why exceptions like those for litigation are necessary and must “cover the litigation process from cradle to grave.”

But Chief Justice John Roberts Jr. wasn’t so sure.

“It has to have a more narrow meaning,” Roberts said. “Otherwise everything would be covered.”

Clement said that earlier drafts of the law had outlined specific types of litigation that would fall under the exception. But the specific list was later dropped in favor of the term “use in litigation.”

“And then in the final iteration, they said ‘use in connection with litigation,’” Clement said. “So clearly they were trying to broaden it.”

Justice Stephen Breyer asked for a clearer limit.

“What I’m trying to get at is the statement that I could write in an opinion that will draw the boundary of this provision south of where the lawyer can go out when he has reason to believe that a defendant has done something wrong and – to use a pejorative – troll for clients,” Breyer said.

“What is south?” Justice Antonin Scalia asked, drawing laughs. “I don’t have a compass here.”

“South means you can’t just go troll for clients!” Breyer said.

Clement said the instant case was easy for line-drawing because the lawyers weren’t looking for a nonexistent cause of action – they already had one.

“At all times in this suit they had a conspiracy claim against the dealers,” Clement said.

A decision is expected later this term.