Private Firms Quietly Help State Enforcement Behind-the-Scenes, Lawyers Say
There has been a quiet shift recently where state privacy enforcement is often aided behind the scenes by private law firms, according to a Tuesday blog post from Frankfurt Kurnit attorneys. These firms typically develop the case and can even appear in the final complaint filed in court, lawyers Daniel Golberg and Holly Melton wrote.
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"Partnering with outside firms allows states to pursue large, complex cases that would be difficult to handle in-house," their blog said. "Many privacy and consumer protection targets are well-funded companies that can mount lengthy, hard-fought defenses," and "private firms often offer to do the investigative legwork, draft pleadings, and manage the litigation."
Additionally, the lawyers said, high-profile cases draw national attention and show leadership on consumer protection, so "a blockbuster case backed by a private firm allows a regulator to make a statement, especially in states where regulators are seen as under-enforcing or under-resourced."
The lawyers said recent examples include Michigan AG Dana Nessel's (D) suit against Roku for children's privacy violations (see 2504290068), Utah AG Derek Brown's (R) suit against social media company Snap for consumer privacy violations (see 2507020037), Nebraska AG Mike Hilgers' (R) lawsuit against GM for misleading consumers about geolocation data collection and practices (see 2507080048) and Texas AG Ken Paxton's (R) suit against Meta for non-consensually collecting biometric data (see 2210200075), which resulted in a $1.4 billion settlement (see 2505090071 and 2505120054). The trend doesn't apply at the federal level, they said.
A company's strategy shifts when private firms are involved, Goldberg and Melton added. Regulators often focus "on remediation and compliance," and "generally try to work with companies in good faith and may wait to file a complaint until a settlement is finalized," and there is a potential for investigations to never become public.
On the flip side, private firms shift the focus to "maximizing financial recovery," with cases "more likely to be filed early, publicly, and aggressively, with a higher likelihood of litigation and significant monetary settlements."