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Unfair Target Data Breach Settlement Returns to Appeals Court

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The Competitive Enterprise Institute today filed additional briefing requested by the Eighth Circuit Court of Appeals about an unfair class action settlement stemming from the 2013 Target data breach, opening up the possibility that the settlement will be rejected.

“The Target class action settlement unfairly freezes out millions of people from getting any settlement relief,” said CEI attorney Melissa Holyoak. “This is a matter of fundamental fairness under the law. Under the current settlement terms, people who had their financial data stolen are forced to release statutory claims or claims for damages incurred after July 2015 in exchange for nothing.”

CEI argues that the district court, in twice approving the settlement, got it wrong yet again: the district court fundamentally misunderstood the structure of the settlement as well as Supreme Court precedent on this matter. CEI’s brief urges the court to reverse class certification and hold that a single class settlement cannot be certified; instead, class members who were frozen out should be in separate subclasses with separate legal counsel.

Though the appeals court initially declined CEI’s request for additional briefing in the case, the court later, on its own initiative, requested additional briefing on the lower court’s renewed certification order. Previously, the Eighth Circuit Court of Appeals ruled that the district court had not “rigorously scrutinized” whether the settlement satisfied class action requirements.

CEI’s Center for Class Action Fairness represents class member Leif Olson in challenging the settlement agreement. View more about the Target data breach settlement on CEI.org.

About CEI’s Center for Class Action Fairness

CEI’s Center for Class Action Fairness represents class members against unfair class action procedures and settlements. Originally founded by Ted Frank in 2009, the center has won millions of dollars for consumers and shareholders and won landmark precedents that safeguard consumers, investors, courts, and the general public.

Unfair settlements generally serve self-interested lawyers and third parties at the expense of absent class members, whose rights are traded away to settle a class action. The class lawyers want their fees and the defendants want to cheaply and quickly end the lawsuit, but the class’s interests often take a back seat in the process. The Center seeks to solve this problem by representing class members pro bono and presenting judges the other side of the argument. When the Center prevails, lawyers get less, class members get more, and the rule of law is strengthened.