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Bell v. Acxiom Corp.

October 3, 2006

APRIL BELL, ON BEHALF OF HERSELF AND OTHERS SIMILARLY SITUATED PLAINTIFF
v.
ACXIOM CORPORATION DEFENDANT



The opinion of the court was delivered by: Wm. R. Wilson, Jr. United States District Judge

ORDER

Defendant Acxiom Corporation ("Acxiom") stores personal, financial, and other company data for its corporate clients. In 2003, Acxiom's computer bank was hacked and client files were compromised. Plaintiff filed this class action seeking damages and injunctive relief alleging that Acxiom's lax security jeopardized her privacy and left her at a risk of receiving junk mail and of becoming a victim of identify theft. Defendant moved for dismissal (Doc. No. 5). Plaintiff has responded (Doc. No. 16). For the reasons stated below, Defendant's Motion to Dismiss is GRANTED.

I. History

Acxiom is a data bank that stores marketing information about its clients' customers. Acxiom takes this information and "match[es] names with lifestyles and demographic information from other sources . . . [to] give . . . [its] client a clear picture of the people buying its products and services."*fn1

In order for its clients to reach their information, Acxiom maintains a File Transfer Protocol ("FTP") site. To access this site, the client must have a username and password, assigned by Acxiom. Between November 2001 and the summer of 2003, Scott Levine, an Acxiom client, exploited a hole in Acxiom's security system, accessed the Acxiom FTP server, and downloaded other client's databases. Levine sold some of the information to a marketing company in Georgia, who then used the names and addresses to advertise via direct mail. Levine has since been convicted for these illegal activities.*fn2

After Levine's conviction, the Plaintiff, April Bell, filed suit against Acxiom on behalf of herself and all others similarly situated. She alleged that Acxiom failed to protect its clients' data.

Plaintiff also alleged that she is at a higher risk of receiving junk mail and of being an identity theft victim.

II. Standard of Review

The standard for a motion to dismiss under Fed. R. Civ. P 12(b)(1) and 12(b)(6) is that the court must construe the facts alleged in the complaint in the most favorable light towards the plaintiffs.*fn3 The court should not dismiss the complaint unless it appears that there are no set of facts which would entitle the plaintiffs to relief.*fn4 The court is "free to ignore legal conclusions, unsupported conclusions, unwarranted inferences and sweeping legal conclusions cast in the form of factual allegations."*fn5 Finally, on a motion to dismiss (as opposed to a motion for summary judgment) the court should assume that general factual allegations embrace the specific facts necessary to support the plaintiff's claim.*fn6

III. Analysis

In its motion to dismiss, Acxiom contends that Plaintiff does not have standing, and in the alternative, that she has not stated a claim upon which relief can be granted. In order to have standing, a plaintiff must meet three requirements.*fn7 First, a plaintiff must demonstrate that she has suffered an injury in fact which is actual, concrete, and particularized.*fn8 Second, the plaintiff must show a causal connection between the conduct complained of and the injury.*fn9 Third, the plaintiff must establish that the injury will be redressed by a favorable decision.*fn10 The plaintiff has the burden of establishing each of these three requirements.*fn11

The burden to show standing is not a mere pleading requirement, but "an indispensable part of the plaintiff's case."*fn12 "Each and every element of the standing requirements 'must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.'"*fn13 Strict compliance with this jurisdictional standing requirement is mandated.*fn14 Assertions of potential future injury do not satisfy the injury-in-fact test. "A threatened injury must be certainly impending to constitute injury in fact."*fn15

In Lujan, environmental groups challenged governmental regulations concerning the Endangered Species Act.*fn16 The groups contended that they had traveled abroad to view endangered species in the past and intended to do so in the future, and that the regulations would negatively affect their ability to do so.*fn17 Reasoning that the groups did not show that one or more of their members would be directly affected by the regulations and that intentions to view endangered species at some "indefinite future time" did not demonstrate an imminent injury, the Supreme Court ruled that the groups failed to show an injury in fact, and thus did not have standing to contest the regulations.*fn18

In this case, Plaintiff alleged that she suffered an increased risk of both receiving unsolicited mailing advertisements and of identity theft. In response, Defendant argues that both Plaintiff's alleged injuries are speculative -- Plaintiff has not plead that she has received a single marketing mailer or had her identity stolen. Moreover, several courts have held that the receipt of unsolicited and unwanted mail does not constitute actual harm.*fn19 Additionally, while there have been several lawsuits alleging an increased risk of identity theft, no court has considered ...


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