LinkedIn Lawsuit

Posted by Kevin Donovan.

In recent legal news, LinkedIn scored a long-awaited victory when the United States District Court for the Northern District of California ruled that website user agreements that forbid data scraping are enforceable in a breach of contract claim.
In 2017, hiQ Labs, a data analytics company, was issued a cease-and-desist order from LinkedIn accusing the company of illegally web scraping and violating the Computer Fraud and Abuse Act. Web scraping is a common practice of obtaining information about potential clients and is often done by robots. Companies that perform data gathering argue that web scraping is vital to the success of their businesses.
In turn, hiQ Labs obtained an injunction against LinkedIn, claiming that data scraping of public sections of people’s profiles does not violate the Computer Fraud and Abuse Act. The U.S. District Court sided with hiQ Labs. The Court stated that this type of activity does not constitute unauthorized use since the data was obtained from public portions of the website. This decision was affirmed on appeal in 2019 by the Ninth Circuit.
In 2020, LinkedIn asked the Supreme Court to overturn the Ninth Circuit’s decision. The Supreme Court remanded the case back to the Ninth Circuit, but the Ninth Circuit reaffirmed its original decision. Their argument was that the Computer Fraud and Abuse Act could only be violated when the access was unauthorized.
In 2022, since they were not successful in claiming that hiQ Labs violated the Computer Fraud and Abuse Act, LinkedIn used a different strategy. They argued that they should be given a summary judgement on a breach of contract claim since hiQ Labs agreed to the terms of their user agreement before accessing their website. The Court agreed with LinkedIn stating that hiQ Labs breached LinkedIn’s user agreement.
The recent hiQ decision is in line with other decisions from the Ninth Circuit, such as Facebook’s suit against BrandTotal. In this case, the Court upheld Facebook’s breach of contract claim. Facebook argued that BrandTotal failed to inform them that they were collecting user’s personal data, thus violating their terms of service.
According to the article, LinkedIn’s victory “is good news for a number of businesses because it offers a pathway for fighting scraping and other user violations.” But the article warns that this means businesses must be vigilant in enforcing their user agreements when they become aware that a violation has occurred. In other words, companies must consistently enforce their terms of use. Despite LinkedIn’s recent victory, there remain many unanswered questions about the legality of data gathering.

Kevin is a business administration major at the Stillman School of Business, Seton Hall University, Class of 2025.

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