Hibnick v. Google Inc.

Filing 153

Transcript of Proceedings held on 02-07-11, before Judge James Ware. Court Reporter/Transcriber Lee-Anne Shortridge, Telephone number 408-287-4580. Per General Order No. 59 and Judicial Conference policy, this transcript may be viewed only at the Clerks Office public terminal or may be purchased through the Court Reporter/Transcriber until the deadline for the Release of Transcript Restriction.After that date it may be obtained through PACER. Any Notice of Intent to Request Redaction, if required, is due no later than 5 business days from date of this filing. Release of Transcript Restriction set for 11/1/2011. (las, ) (Filed on 8/3/2011)

1

UNITED STATES DISTRICT COURT

2

NORTHERN DISTRICT OF CALIFORNIA

3

SAN JOSE DIVISION

4
5
6

IN RE GOOGLE BUZZ USER
PRIVACY LITIGATION,

7
8
_________________________

)
)
)
)
)
)
)

C-10-00672 JW
SAN JOSE, CALIFORNIA
FEBRUARY 7, 2011
PAGES 1-48

9
10
11

TRANSCRIPT OF PROCEEDINGS
BEFORE THE HONORABLE JAMES WARE
UNITED STATES DISTRICT JUDGE

12
13

A P P E A R A N C E S:

14

FOR THE PLAINTIFFS: MASON LLP
BY: GARY E. MASON
1625 MASSACHUSETTS AVENUE, NW
SUITE 605
WASHINGTON, D.C. 20036

15
16
17
18

RAM & OLSON
BY: MICHAEL F. RAM
555 MONTGOMERY STREET, SUITE 820
SAN FRANCISCO, CALIFORNIA 94111

19
20
21
22

HARVARD LAW SCHOOL
BY: WILLIAM B. RUBENSTEIN
1545 MASSACHUSETTS AVENUE
CAMBRIDGE, MASSACHUSETTS 02138
APPEARANCES CONTINUED ON NEXT PAGE

23
24

OFFICIAL COURT REPORTER: LEE-ANNE SHORTRIDGE, CSR, CRR
CERTIFICATE NUMBER 9595

25
1

1
2

APPEARANCES (CONTINUED)

3

FOR OBJECTOR
ZIMMERMAN:

JOSHUA R. FURMAN LAW CORP.
BY: JOSHUA R. FURMAN
9663 SANTA MONICA BOULEVARD
SUITE 721
BEVERLY HILLS, CALIFORNIA 90210

FOR OBJECTORS
COPE AND MAREK:

LAW OFFICES OF DARRELL PALMER
BY: DARRELL PALMER
603 NORTH HIGHWAY 101, SUITE A
SOLANA BEACH, CALIFORNIA 92075

FOR OBJECTOR
JACKSON:

STATMAN, HARRIS & EYRICH, LLC
BY: JEFFREY P. HARRIS AND
ALAN J. STATMAN
3700 CAREW TOWER
441 VINE STREET
CINCINNATI, OHIO 45202

FOR OBJECTOR
RUDGAYZER:

OSBORN LAW, P.C.
BY: DANIEL A. OSBORN
295 MADISON AVENUE
39TH FLOOR
NEW YORK, NEW YORK 10017

FOR OBJECTOR
GACHOT:

NATALIE GACHOT
IN PRO PER

FOR THE DEFENDANT:

PERKINS COIE
BY: SUSAN FAHRINGER
1201 THIRD AVENUE, SUITE 4800
SEATTLE, WASHINGTON 98101

4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

2

1

SAN JOSE, CALIFORNIA

2

P R O C E E D I N G S

3
4

FEBRUARY 7, 2011

(WHEREUPON, COURT CONVENED AND THE
FOLLOWING PROCEEDINGS WERE HELD:)

5

THE CLERK:

CALLING CASE NUMBER IN RE

6

GOOGLE BUZZ PRIVACY LITIGATION, ON FOR MOTION FOR

7

FINAL APPROVAL OF CLASS SETTLEMENT AND ATTORNEYS'

8

FEES.

9
10

FIVE MINUTES EACH SIDE AS TO BOTH
MOTIONS.

11
12

COUNSEL, PLEASE COME FORWARD AND STATE
YOUR APPEARANCES.

13
14

MR. MASON:

GARY MASON, CLASS COUNSEL FOR PLAINTIFFS.

15
16

MR. RAM:

19
20
21

GOOD MORNING, YOUR HONOR.

MICHAEL RAM FOR THE PLAINTIFF CLASS.

17
18

GOOD MORNING, YOUR HONOR.

MR. RUBENSTEIN:
HONOR.

GOOD MORNING, YOUR

WILLIAM RUBENSTEIN FOR THE PLAINTIFF CLASS.
MS. FAHRINGER:

SUSAN FAHRINGER

REPRESENTING GOOGLE.
MR. FURMAN:

GOOD MORNING, YOUR HONOR.

22

JOSHUA FURMAN FOR PLAINTIFF OBJECTOR

23

JOHN ZIMMERMAN.

24
25

MR. PALMER:

GOOD MORNING, YOUR HONOR.

DARRELL PALMER ON BEHALF OF OBJECTOR STEVEN COPE,
3

1

AND SPECIALLY APPEARING FOR MEGAN MAREK.

2

MR. HARRIS:

GOOD MORNING, YOUR HONOR.

3

JEFFREY P. HARRIS FOR OBJECTOR ALISON JACKSON, AND

4

ALSO MY PARTNER, ALAN STATMAN.

5

MR. OSBORN:

GOOD MORNING, YOUR HONOR.

6

DANIEL OSBORN ON BEHALF OF OBJECTOR

7

TANYA RUDGAYZER.

8
9

MS. GACHOT:

GOOD MORNING, YOUR HONOR.

NATALIE GACHOT, OBJECTOR APPEARING IN PRO PER.

10

THE COURT:

IT'S UNUSUAL TO HAVE THE

11

OBJECTORS OUTNUMBER THE PARTIES IN THIS KIND OF

12

CASE.

13

OBJECTORS FIRST, BUT LET'S HEAR FROM YOU,

14

MR. MASON, IS IT?

15

I ALMOST FEEL LIKE I SHOULD HEAR FROM THE

MR. MASON:

IT'S MASON, THANK YOU, YOUR

16

HONOR.

WE ARE GOING TO KEEP OUR COMMENTS BRIEF AND

17

TRY TO RESERVE TIME FOR REPLY TO THE OBJECTIONS.

18

I'M SPLITTING THE ARGUMENT THIS MORNING

19

WITH MY CO-COUNSEL, PROFESSOR RUBENSTEIN, AND I'M

20

GOING TO LET PROFESSOR RUBENSTEIN ARGUE FIRST ON

21

BEHALF OF THE SETTLEMENT ITSELF, AND I'M PREPARED

22

TO TALK ABOUT ATTORNEYS' FEES.

23

MR. RUBENSTEIN:

GOOD MORNING, YOUR

24

HONOR.

I'LL BE BRIEF AND WOULD ASK THAT WE RESERVE

25

TIME TO RESPOND TO THE OBJECTORS.
4

1
2
3

JUST TO MAKE SEVERAL POINTS TO PRESENT
THE SETTLEMENT TO YOU.
THE CASE WAS ORIGINALLY BROUGHT AGAINST

4

GOOGLE HAVING TO DO WITH THE LAUNCH OF THEIR SOCIAL

5

NETWORKING PROGRAM, THE BUZZ PROGRAM.

6

THE CONCERN WAS THAT BUZZ WAS ATTACHED TO

7

GOOGLE'S E-MAIL PROGRAM, GMAIL, AND IT USED THE

8

CONTACTS IN YOUR GMAIL CONTACT LIST AS THE BASIS OF

9

THE SOCIAL NETWORKING PROGRAM.

10

AND THIS RAISED PRIVACY CONCERNS BECAUSE

11

THERE'S A DIFFERENCE BETWEEN PEOPLE WHO YOU HAVE IN

12

YOUR E-MAIL CONTACT LIST AND PEOPLE WHO YOU MIGHT

13

WANT TO BE IN A SOCIAL NETWORKING PROGRAM WITH.

14

HAVING SAID THAT, THE BROADEST

15

ALLEGATIONS ABOUT THE PROGRAM THAT WERE MADE AT THE

16

OUTSET WERE ESSENTIALLY THAT JUST BY LAUNCHING

17

BUZZ, EVERYONE'S GMAIL CONTACT LIST SUDDENLY BECAME

18

PUBLIC TO THE WORLD, AND AFTER INVESTIGATION OF

19

THOSE ALLEGATIONS, THEY TURNED OUT NOT TO BE TRUE,

20

YOUR HONOR.

21
22
23

SEVERAL THINGS WE LEARNED WERE THAT -TWO IMPORTANT FACTS.
FIRST, FOR ANY INFORMATION TO BECOME

24

PUBLIC, A USER HAD TO ACTIVATE BUZZ, WHICH REQUIRED

25

STEPPING THROUGH SEVERAL SCREENS AND GOING THROUGH
5

1
2

AN ACTIVATION PROCESS.
AND, SECOND, THE RELEASE OF INFORMATION

3

WASN'T TO THE WHOLE WORLD.

4

ON THE WEB IF YOU HAD A GOOGLE PROFILE AND HAD DONE

5

THAT; OR, SECOND, IT WAS ONLY WITHIN THE NETWORK OF

6

PEOPLE WHO YOU WERE WITHIN.

7

IT WAS ONLY BROADCAST

SO WHERE WE STARTED WITH VERY BROAD

8

ALLEGATIONS IN THIS CASE, ONE OF THE THINGS WE

9

FOUND WAS THAT, IN FACT, THE BUZZ PROGRAM,

10

PARTICULARLY AFTER IT WAS MODIFIED THROUGHOUT THE

11

COURSE OF THIS LITIGATION, DIDN'T HAVE AS WIDE

12

DISSEMINATION OF THE PRIVATE INFORMATION AS WE

13

THOUGHT IT DID, AND THE ONLY INFORMATION WE'RE EVER

14

TALKING ABOUT WERE THE E-MAIL ADDRESSES OF YOUR

15

CONTACTS IN YOUR E-MAIL LIST.

16

SO THE PROGRAM -- THE CASE REALLY BECAME

17

ONE OF HAVING TO DEAL WITH GOOGLE'S PROGRAMS THAT

18

ENABLED USERS TO UNDERSTAND WHAT WAS BEING DONE

19

WITH THEIR INFORMATION AND WHETHER THAT WAS

20

SUFFICIENTLY DETAILED SO THAT USERS OF THE PROGRAM

21

KNEW HOW TO CONTROL THE PRIVACY OF THEIR

22

INFORMATION.

23

AFTER WE LEARNED MORE ABOUT THE PROGRAM

24

AND INVESTIGATED IT IN DEPTH, WE ENTERED INTO

25

SETTLEMENT NEGOTIATIONS.
6

1

WE HAD A FULL DAY MEDIATION IN FRONT OF

2

THE HONORABLE FERN SMITH, A RETIRED FEDERAL COURT

3

DISTRICT JUDGE, THAT YIELDED THE PRESENT SETTLEMENT

4

THAT WE PRESENTED TO THE COURT.

5

THE SETTLEMENT HAS THREE COMPONENTS OF

6

RELIEF FOR THE CLASS, YOUR HONOR:

FIRST, IT

7

ACKNOWLEDGES THE CHANGES THAT HAVE BEEN MADE TO THE

8

PROGRAM TO BE MORE PRIVACY SENSITIVE TO USERS;

9

SECOND, GOOGLE'S AGREED TO DO A PUBLIC EDUCATION

10

CAMPAIGN ABOUT THE PRIVACY ASPECTS OF BUZZ SO

11

PEOPLE UNDERSTAND THAT MORE; AND, THIRD, WE'VE

12

CREATED AN $8.5 MILLION SETTLEMENT FUND.

13

BECAUSE THERE ARE 37 MILLION CLASS

14

MEMBERS, YOUR HONOR, THE SETTLEMENT FUND WILL BE

15

DISTRIBUTED CY PRES TO GROUPS THAT ARE WORKING ON

16

INTERNET PRIVACY AND PUBLIC POLICY EDUCATION ABOUT

17

INTERNET PRIVACY.

18
19
20

WE THINK ALL OF THESE BENEFITS ARE VERY
STRONGLY SIGNIFICANT FOR THE CLASS.
IT IS TRUE CLASS MEMBERS WON'T BE GETTING

21

INDIVIDUAL DAMAGES.

22

DIDN'T FIND ANY INDIVIDUALS WITH ACTUAL

23

OUT-OF-POCKET DAMAGES.

24
25

IN OUR INVESTIGATIONS, WE

HOWEVER, WE ASK THAT THIS CLASS BE
CERTIFIED AS A (B)(3) CLASS .

YOU'LL REMEMBER WE
7

1

TALKED ABOUT THAT AT THE PRELIMINARY APPROVAL

2

HEARING, AND THAT GAVE INDIVIDUALS THE OPPORTUNITY

3

TO OPT OUT IF ANYONE HAD INDIVIDUAL DAMAGES THEY

4

WANTED TO PURSUE.

5

THEY WANTED TO OPT OUT.

6

THEY HAD THAT OPPORTUNITY IF

570 PEOPLE OPTED OUT OF THE SETTLEMENT,

7

YOUR HONOR.

8

OUT-OF-POCKET DAMAGES.

9

NO ONE HAS COME FORWARD WITH ANY EVIDENCE OF THAT.

10

SO UNDER THE CIRCUMSTANCES, WE THINK THE

11

WE DON'T KNOW IF ANY OF THEM HAVE
NONE OF THE OBJECTORS AND

SETTLEMENT IS FAIR AND REASONABLE.

12

AGAIN, THE PROCESS BY WHICH IT WAS

13

NEGOTIATED WAS AT ARM'S LENGTH IN FRONT OF A

14

FEDERAL JUDGE, RETIRED FEDERAL JUDGE.

15

ARE VERY FAVORABLE.

16

THE TERMS

WE FACED SIGNIFICANT RISKS OF LITIGATING

17

IT FURTHER.

18

MAIN CLAIM WAS UNDER THE STORED COMMUNICATIONS ACT.

19

I'LL MENTION TWO VERY QUICKLY.

OUR

THE STORED COMMUNICATIONS ACT ALLOWS THE

20

RELEASE OF RECORD INFORMATION, BUT NOT CONTENT

21

INFORMATION.

22

GOOGLE'S POSITION WAS THAT THE E-MAIL

23

ADDRESSES, EVEN IF THEY WERE RELEASED WITHOUT USER

24

CONSENT, WERE JUST RECORD INFORMATION AND NOT

25

CONTENT INFORMATION.
8

1

SECOND, GOOGLE'S POSITION IS THAT USERS

2

CONSENTED BY GOING THROUGH THE STEPS OF THE BUZZ

3

PROGRAM TO SET UP THEIR ACTIVATION, AND WE WOULD

4

HAVE FACED SIGNIFICANT RISK OF PROVING THERE WAS NO

5

USER CONSENT IN THESE CIRCUMSTANCES.

6

YOUR HONOR, WE BELIEVE THE SETTLEMENT

7

COMPARES FAVORABLY TO OTHER SETTLEMENTS OF THIS

8

TYPE.

9

PRIVACY FUND THAT WILL EVER BE SET UP TO FUND

10

WE THINK THIS IS ONE OF, IF NOT THE LARGEST

INTERNET PRIVACY.

11

WE'VE PRESENTED IN OUR MOTION PAPERS A

12

LOT OF SETTLEMENTS THAT HAVE NO MONETARY RELIEF,

13

SOME SETTLEMENTS WITH LESS MONETARY RELIEF, AND WE

14

ONLY KNOW OF ONE SETTLEMENT WITH MORE, A LARGER

15

FUND, AND THAT'S THE FACEBOOK SETTLEMENT WHICH IS

16

NOW ON APPEAL IN THE NINTH CIRCUIT.

17

SECOND, YOUR HONOR NOTED THAT THERE ARE A

18

SIGNIFICANT NUMBER OF OBJECTORS IN THE COURTROOM

19

AND WE WILL ALLOW YOU TO HEAR THEM AND HEAR WHAT

20

THEY HAVE TO SAY.

21

I WANT TO NOTE SEVERAL THINGS FOR THE

22

RECORD.

23

SETTLEMENT UNDER CAFA.

24

ATTORNEY GENERALS.

25

NO GOVERNMENT'S OBJECTED TO THIS
WE SERVED ALL THE STATE

THE UNITED STATES -- THE FTC IS
9

1

OVERSEEING A COMPLAINT ABOUT THIS SAME PROGRAM AND

2

THEY DID NOT OBJECT TO THIS SETTLEMENT.

3
4

NO INDEPENDENT CONSUMER GROUPS OBJECTED
TO THE SETTLEMENT.

5

THE TOTAL NUMBER OF OBJECTORS IS ABOUT

6

ONE IN A MILLION AS THERE ARE 37 MILLION CLASS

7

MEMBERS.

8

I NOTED, YOUR HONOR, IN YOUR FIRST

9

FAIRNESS HEARING THIS MORNING, THERE WAS ONE

10

OBJECTOR AND THE CLASS SIZE WAS 300,000.

11

TRANSLATES INTO ABOUT 100 OBJECTORS, TWICE AS MANY

12

AS WE HAVE HERE.

13

THAT

AND IN THE SECOND FAIRNESS HEARING YOU

14

HAD THIS MORNING, THERE WERE 25 OBJECTORS IN A

15

CLASS OF 200,000.

16

OBJECTORS.

17
18

THAT TRANSLATED INTO ABOUT 3700

WE HAVE A TOTAL OF 47 OBJECTORS TO THIS
SETTLEMENT.

19

SO WE THINK THE SETTLEMENT HAS NOT

20

RECEIVED A SIGNIFICANT AMOUNT OR SIGNIFICANT

21

QUALITY OF OBJECTION.

22

WE'D RESERVE THE RIGHT TO RESPOND TO WHAT

23

THE OBJECTORS HAVE TO SAY AND WE THANK YOU FOR

24

CONSIDERING THIS.

25

THE COURT:

JUST ONE QUESTION.

I HAD
10

1

UNDERSTOOD THAT THERE HAD BEEN A SIGNIFICANT

2

CHANGE, NOT JUST IN THE PROCEDURE OF BUZZ, BUT THE

3

BUZZ PROGRAM ITSELF HAD BEEN MODIFIED IN SOME WAY.

4

AM I CORRECT OR INCORRECT?

5

MR. RUBENSTEIN:

6
7

WHEN YOU SAY NOT JUST IN

THE PROCEDURES, BUT -THE COURT:

IN OTHER WORDS, THE -- AS I

8

UNDERSTAND THE WAY THE PROGRAM WAS SET UP, YOU HAD

9

TO STEP THROUGH A NUMBER OF SCREENS, AND AT THE END

10

OF THAT, YOU WERE IN A POSITION OF BEING A MEMBER

11

OF THIS SOCIAL NETWORK AND YOUR E-MAIL ADDRESSES OF

12

THOSE TO WHOM YOU USE GMAIL, I GUESS, WERE THEN

13

PART OF THE NON-PRIVATE INFORMATION.

14

IS THAT STILL THE CASE?

15

MR. RUBENSTEIN:

IT IS STILL THE CASE

16

THAT IF YOU USE BUZZ, TO SET IT UP, YOU STEP

17

THROUGH A SERIES OF SCREENS.

18

THE THREE STEPS THAT YOU GO THROUGH HAVE

19

EACH CHANGED SINCE THE INCEPTION OF BUZZ, AND THE

20

CHANGES THAT HAVE BEEN MADE IN EACH OF THEM -- AND

21

I'M HAPPY TO WALK YOUR HONOR THROUGH WHAT THEY

22

ARE -- THE CHANGES THAT HAVE BEEN MADE IN EACH OF

23

THE THREE STEPS HAVE MADE EACH STEP MORE PRIVACY

24

SENSITIVE AND HAVE GIVEN USERS MORE CONTROL OVER

25

WHO IS IDENTIFIED AS BEING IN THEIR SOCIAL NETWORK
11

1

AND OVER WHETHER THE USER WANTS THAT INFORMATION TO

2

BE MADE PUBLIC OR TO BE KEPT PRIVATE.

3

IF, AT THE END OF THOSE THREE STEPS, THE

4

USER'S CHOICES ARE TO REVEAL WHO'S IN THEIR SOCIAL

5

NETWORK, THEN THAT INFORMATION WILL BE PUBLIC.

6

IF THE USER SELECTS THE OPTIONS THAT

7

GOOGLE -- I'M SORRY, I SHOULD BACK UP.

8
9

THAT INFORMATION WILL BE SHARED AMONG THE
PEOPLE IN THE SOCIAL NETWORK.

10
11

IF THAT PERSON HAS A GOOGLE PROFILE, IT
COULD BE ON THE WEB AS WELL.

12

IF THE PERSON, IN SETTING UP BUZZ,

13

SELECTS THE OPTIONS TO KEEP THE INFORMATION PRIVATE

14

AND NOT POST AMONG THE SOCIAL NETWORK OR ON THE

15

WEB, THEN THAT INFORMATION WILL NOT BE MADE PUBLIC,

16

YOUR HONOR.

17

KEPT PRIVATE TOTALLY.

18

IN THAT SENSE.

19
20
21

IT'S KEPT WITHIN THE SOCIAL NETWORK OR
THE USER HAS CONTROL OVER IT

I DON'T KNOW IF THAT ADDRESSED YOUR
QUESTION.
THE COURT:

IT -- WELL, AT LEAST IT SAID

22

WORDS THAT CLARIFIED THAT THERE IS A PROCEDURE

23

STILL NOW WHERE IF YOU GO THROUGH THESE SCREENS AND

24

YOU AREN'T -- YOU DON'T SELECT THEM IN A CERTAIN

25

WAY, YOU COULD UNWITTINGLY END UP AT A CIRCUMSTANCE
12

1

WHERE YOUR MAIL RECIPIENTS BECOME PART OF THE

2

SOCIAL NETWORK THAT YOU'VE REVEALED TO THE PUBLIC.

3

MR. RUBENSTEIN:

4

HERE.

5

UNWITTINGLY IS THE HITCH

THE QUESTION IS HOW MUCH CONTROL A USER HAS

AND WHAT THEIR OPTIONS ARE.

6

LET ME GIVE YOU ONE EXAMPLE.

WHEN THE

7

PROGRAM STARTED, THE SECOND STEP OF THE PROGRAM

8

SAID "THESE ARE THE PEOPLE YOU'RE ALREADY

9

FOLLOWING," AND IT HAD A LIST OF PEOPLE WHO WERE

10

YOUR E-MAIL CONTACTS WITH WHOM YOU COMMUNICATED

11

MOST FREQUENTLY.

12

NOW WHEN YOU GO THROUGH THAT STEP, NEXT

13

TO EACH OF THOSE PERSON'S NAME AND E-MAIL ADDRESS,

14

THERE'S A CHECKMARK AND IT'S CLEAR THAT YOU CAN

15

CHECK OR UNCHECK EACH OF THE PEOPLE WHOM YOU WANT

16

TO SELECT TO HAVE IN YOUR NETWORK.

17

SO THE PROGRAM MAKES IT EASIER TO TAKE

18

OUT PEOPLE WHOM YOU DON'T WANT TO COMMUNICATE --

19

YOU DON'T WANT TO BE IDENTIFIED --

20

THE COURT:

BUT THE DEFAULT IS THAT

21

THEY'RE INCLUDED AND YOU HAVE TO ACTUALLY GO

22

THROUGH THE STEP OF DESELECTING THEM?

23

MR. RUBENSTEIN:

CORRECT.

THAT IS

24

CORRECT, YOUR HONOR, AND THAT'S ONE THING WE TALKED

25

ABOUT QUITE A BIT IN THE MEDIATION.
13

1

BUT HAVING SAID THAT, THAT CURRENT SET UP

2

WHERE YOU CAN EASILY UNCLICK IS BETTER THAN IT WAS

3

WHEN THE PROGRAM STARTED.

4

AND I SHOULD SAY, WHEN THE PROGRAM

5

STARTED -- PART OF THE CONFUSION ABOUT THIS IS

6

GOOGLE'S ADVERTISEMENTS OF THIS PROGRAM SAID

7

THERE'S NO SET UP NEEDED, YOU'RE AUTOMATICALLY

8

FOLLOWING ALL OF THESE PEOPLE.

9

WHAT BUZZ NOW SAYS IS "WE SUGGEST THAT

10

YOU FOLLOW THE FOLLOWING PEOPLE," AND IT HAS THE

11

CHECKMARKS AND YOU CAN TAKE THEM OUT.

12

THERE'S ALSO, IN THE THIRD STEP OF THE

13

PROGRAM, AN OPPORTUNITY TO DESELECT AGAIN THE LEVEL

14

OF PRIVACY THAT YOU WANT -- TO SELECT THE LEVEL OF

15

PRIVACY THAT YOU WANT WITH REGARD TO THE PEOPLE WHO

16

ARE IN YOUR SOCIAL NETWORK.

17

AND, YOUR HONOR, I'M SURE --

18

THE COURT:

19

WANT TO ADD TO THIS.

I'M SURE MS. FAHRINGER WOULD

20

GO AHEAD, MA'AM.

21

MS. FAHRINGER:

22
23

JUST ONE POINT OF

CLARIFICATION.
YOU HAD ASKED ABOUT E-MAIL ADDRESSES, AND

24

JUST TO BE CLEAR, AT NO POINT WERE ACTUAL E-MAIL

25

ADDRESSES PUBLICLY DISCLOSED.
14

1

WHAT WAS DISCLOSED, ONCE ALL OF THE

2

SCREENS HAD BEEN SHOWN, ONCE ALL OF THE TRIGGERS

3

HAD BEEN APPROVED BY THE USER, WAS THE PROFILE NAME

4

OF YOUR FOLLOWERS, AND FOR THOSE, IT WAS ONLY THOSE

5

PEOPLE WHO HAD ALSO CREATED A PUBLIC PROFILE.

6

SO THE DISCLOSURE WAS NOT ONLY TO A

7

SMALLER GROUP THAN ORIGINALLY ALLEGED IN THE

8

COMPLAINT, AND ALWAYS HAS BEEN, BUT IT WAS ONLY OF

9

THOSE PEOPLE WHO HAD THEMSELVES GONE THROUGH A

10

PROCESS TO CREATE AND APPROVE THEIR OWN PUBLIC

11

PROFILE.

12

SO IT ACTUALLY IS JUST A FAR NARROWER

13

GROUP AND DOES NOT INCLUDING E-MAIL ADDRESSES THAT

14

ULTIMATELY ARE PARTICIPATING IN THE BUZZ PROGRAM.

15

THE COURT:

WELL, LET'S HEAR FROM THE

16

OBJECTORS AND THEN WE'LL COME BACK.

17

MR. RUBENSTEIN:

18

THE COURT:

19
20

THANK YOU VERY MUCH.

ANY OBJECTOR WISH TO SPEAK TO

THE COURT?
MR. HARRIS:

21

MORNING, YOUR HONOR.

22

HARRIS & EYRICH.

23

JEFFREY HARRIS.

GOOD

ALISON JACKSON.

24
25

JEFFREY HARRIS FROM STATMAN,

WE REPRESENT OBJECTOR

AFTER DISCUSSIONS WITH ALISON JACKSON,
AND AFTER REVIEWING THE NOTICE AND THE SETTLEMENT
15

1

AGREEMENT, WE BECAME CONCERNED THAT THERE REALLY IS

2

SOME SERIOUS TECHNICAL PROBLEMS IN THIS SETTLEMENT,

3

AND ALSO SOME SUBSTANTIVE ISSUES THAT NEED TO BE

4

ADDRESSED.

5

AS IN EVERY SETTLEMENT, THE REMEDY NEEDS

6

TO FIT THE PROBLEM, AND WE DON'T THINK THAT'S

7

HAPPENING HERE.

8

WE'RE NOT IN THE BUSINESS OF OBJECTING.

9

WE'VE NEVER OBJECTED BEFORE IN A CLASS ACTION CASE,

10

ALTHOUGH WE'VE BEEN INVOLVED IN CLASS ACTION CASES.

11

BUT IN THIS PARTICULAR CASE, WE THINK

12

THAT WE NEED TO ASSIST THIS CLASS TO -- AND TO --

13

AND OUR CLIENT TO GET A REMEDY THAT MORE FITS THE

14

PROBLEM.

15

AND WE'RE NOT HERE TO DERAIL THIS

16

SETTLEMENT, BUT WE BELIEVE THAT IT CAN BE

17

RESTRUCTURED TO ADDRESS THE CONCERNS OF THE CLASS,

18

AND POSSIBLY ALSO IT NEEDS TO BE RESTRUCTURED

19

BECAUSE IF IT GOES THROUGH THIS WAY, WE FEEL

20

THERE'S A VERY STRONG LIKELIHOOD THAT THIS CASE

21

WILL BE OVERTURNED ON APPEAL.

22

WE RAISED FIVE SPECIFIC OBJECTIONS.

23

THREE OF THOSE OBJECTIONS WERE NOT DEALT WITH IN

24

THE REPLY, AND TWO OF THEM WERE PARTIALLY

25

ADDRESSED, BUT REALLY THE WAY IT WAS ADDRESSED
16

1

ACTUALLY SUPPORTS THE OBJECTION.

2

THE FIRST, WHICH IS A VERY SPECIFIC

3

OBJECTION, IS THAT EVERYTHING THAT'S BEEN FILED IN

4

THIS CASE SHOWS THAT WHAT THEY DID TO REMEDY THE

5

PROBLEM ALL OCCURRED BEFORE FEBRUARY 17TH WHEN THE

6

FIRST CASE WAS FILED.

7

THERE WAS ONE THING THAT HAPPENED AFTER,

8

ON APRIL 5, WHEN THERE WAS A CONFIRMATION NOTICE

9

SENT OUT.

10

SO WE HAVE A SITUATION WHERE THE

11

PLAINTIFF -- AND AS FAR AS I CAN SEE, GOOGLE IS

12

SAYING THE PROBLEM'S REMEDIED ON APRIL 5.

13
14

WE HAVE A CLASS PERIOD, THOUGH, THAT RUNS
TO THE DATE OF THE NOTICE.

15

THIS MEANS THAT THIS CLASS IS OVERBROAD.

16

PEOPLE FROM APRIL 5 WHO JOINED GMAIL THROUGH THE

17

NOTICE DATE HAVE NO DAMAGE AND, AS IN EVERY CLASS

18

ACTION, YOU START WHEN THE PROBLEM HAPPENED, AND

19

YOU STOP THE CLASS PERIOD WHEN THE PROBLEM'S

20

RESOLVED.

21
22

WE TRIED TO DISCUSS THIS WITH PLAINTIFFS'
COUNSEL.

WE TRIED TO DEAL WITH THIS ISSUE.

23

BUT THERE'S BEEN NO AVAIL.

24

BUT I THINK THAT JUST BECAUSE GOOGLE

25

WANTS THE BROADEST RELIEF POSSIBLE AS FAR AS A
17

1

RELEASE GOES BY INCLUDING ALL THESE PEOPLE, THEY

2

GET THE RELEASE FOR THEM, IT DOESN'T JUSTIFY

3

INCLUDING PEOPLE WHO ARE AFTER -- WHO JOINED AFTER

4

THE DATE THE PROBLEM'S REMEDIED.

5

SECONDLY, THE WAY THE SETTLEMENT IS

6

STRUCTURED, AND IF YOU READ THE SETTLEMENT

7

AGREEMENT CAREFULLY, THE RELEASE FOR THE ENTIRE

8

CLASS HAPPENS AT THE TIME THIS FINAL ORDER GETS

9

FILED.

10

HOWEVER, THE DISTRIBUTION OF THE CY PRES

11

FUND DOESN'T HAPPEN UNLESS THE FINAL ORDER GETS

12

ENTERED AND IT BECOMES NON-APPEALABLE.

13

SO YOU HAVE PEOPLE GIVING UP THEIR CLAIMS

14

BEFORE THE CY PRES FUND IS OBLIGATED TO BE

15

DISTRIBUTED.

16

WE BELIEVE THAT THESE THINGS SHOULD

17

COTERMINOUS.

18

IT SHOULD BE AT THE TIME THE FINAL ORDER IS

19

NON-APPEALABLE, JUST LIKE AT THE SAME TIME THE

20

BENEFIT IS TO BE GIVEN TO THE CLASS.

21

IF PEOPLE ARE GIVING UP THEIR CLAIMS,

THE THIRD THING IS THEY'RE CLAIMING THAT

22

THERE'S A BENEFIT FROM SOME KIND OF EDUCATION

23

PROGRAM, AND ALSO A BENEFIT FROM THE CASE BEING

24

FILED.

25

THE FACT OF THE MATTER IS THIS CASE WAS
18

1

FILED ON FEBRUARY 17TH.

2

ACTIONS OF CHANGING THE PROGRAM HAPPENED BEFORE THE

3

CASE WAS FILED.

4

ALL OF THE AFFIRMATIVE

AND THE EDUCATION EFFORTS ARE NOT

5

DESIGNATED AND THEY'RE TOTALLY IN GOOGLE'S

6

DISCRETION.

7

IF THERE'S EDUCATION EFFORTS, THIS

8

COURT -- AND IT'S PART OF ITS FIDUCIARY DUTY TO THE

9

CLASS -- SHOULD HAVE THE OPPORTUNITY TO KNOW WHAT

10

THOSE EDUCATIONAL EFFORTS ARE AND TO MAKE SURE THAT

11

THEY'RE SPECIFICALLY ADDRESSING THE PROBLEM.

12

THE FOURTH ISSUE, WHICH I THINK IS JUST A

13

FATAL FLAW, IS THEY HAVE A CY PRES FUND, BUT THEY

14

DON'T DESIGNATE THE CY PRES RECIPIENT.

15

NOW, THAT'S OKAY, AND IT ACTUALLY CAME UP

16

IN THE CASE THAT WAS BEFORE US, AND I APOLOGIZE, I

17

FORGET THE NAME.

18

IN THAT CASE, THEY SAID "WE'RE GOING TO

19

HAVE A CY PRES FUND THAT, YOU KNOW, BENEFITS THE

20

CLASS, AND WHEN WE DETERMINE IT, WE'RE GOING TO

21

COME BACK TO THIS COURT SO THE COURT CAN EXERCISE

22

ITS FIDUCIARY DUTY AND TELL THE COURT WHO THE FUND

23

IS AND LET THE COURT KNOW TO SEE IF IT'S AN

24

APPROPRIATE FUND."

25

THEY DON'T DO THAT IN THIS SETTLEMENT,
19

1

AND THEIR OWN CASES -- WELL, FIRST OF ALL, WE CITED

2

PROBABLY THE CASE MOST ON POINT, SIX MEXICAN

3

WORKERS.

4

CY PRES RECIPIENT IS ACCEPTABLE AND BENEFITS THE

5

CLASS IS ON THE DEFENDANT AND THAT THERE NEEDS TO

6

BE A RECORD.

7
8

IT CLEARLY SAYS THE BURDEN OF PROVING THE

HOW CAN THERE BE A RECORD IF YOU DON'T
EVEN KNOW WHO THE CY PRES RECIPIENT IS?

9

AND SECONDLY, IT CLEARLY SAYS THAT THE

10

COURT, AS PART OF ITS FIDUCIARY DUTY, NEEDS TO

11

REVIEW THAT.

12

THE CASES THAT THEY CITE -- EVERY CASE

13

THAT THEY CITE IN THEIR REPLY, EXCEPT FOR ONE WHICH

14

DIDN'T ADDRESS THE ISSUE, ALL WERE CASES IN WHICH

15

THE CY PRES RECIPIENT WASN'T DESIGNATED AT THE TIME

16

OF THE HEARING, BUT THERE WAS LANGUAGE IN THE

17

SETTLEMENT AGREEMENT THAT REQUIRED THEM TO COME

18

BACK TO COURT AND HAVE THE COURT LOOK AT IT AND

19

APPROVE IT.

20

THE LAST POINT, WHICH I'M NOW GETTING

21

LONG AND I APOLOGIZE, BUT IT'S AN IMPORTANT POINT,

22

IS THAT EVERYONE KEEPS TALKING ABOUT NO DAMAGE, NO

23

HARM.

24
25

THERE IS ONE PERSON WHO FILED AN
OBJECTION THAT CLAIMED HARM OF IDENTITY THEFT.
20

1
2

I DID GO THROUGH THIS WITH A COLLEAGUE OF
MINE --

3

THE COURT:

4

MR. HARRIS:

5
6
7

WAS THAT MS. JACKSON?
NO.

THAT WAS -- EXCUSE ME.

THAT WAS CLAIM NUMBER 86, KAREN SUE -THE COURT:

I JUST WANTED TO KNOW IF IT

WAS YOUR CLIENT.

8

MR. HARRIS:

KAREN SUE LLANO.

9

BUT IN PREPARING FOR THIS HEARING, I WENT

10

WITH A COLLEAGUE IN MY OFFICE, AN ATTORNEY, AND

11

WENT BACK TO HER GOOGLE BUZZ ACCOUNT AND WE LOOKED

12

AT HER GOOGLE BUZZ ACCOUNT.

13
14
15
16
17

SHE HAD NEVER SEEN IT BEFORE.

SHE DIDN'T

KNOW IT EXISTED.
SHE WAS NOT FOLLOWING ANY PEOPLE.

THERE

WAS ONE PERSON THAT WAS FOLLOWING HER.
AND I KNEW SHE HAD BEEN MARRIED, SO I

18

JOKINGLY SAID, "HEY," I'M NOT GOING TO SAY HER

19

NAME, "BUT HEY, IT'S PROBABLY YOUR EX-HUSBAND."

20

GUESS WHAT?

IT WAS HER EX-HUSBAND.

21

AND GUESS WHAT ELSE?

SHE HAD A

22

RESTRAINING ORDER AGAINST HIM THAT HAD JUST COME UP

23

30 DAYS AGO.

24
25

NOW, THE POINT TO THAT STORY IS, WHAT
HAPPENS IF THIS GUY, BECAUSE OF INFORMATION HE GOT
21

1

FROM THE RELEASE ON FEBRUARY 9TH, THREE WEEKS FROM

2

NOW DOES SOMETHING, MAIMS HER, HARMS HER, DISABLES

3

HER?

4

THE WAY THIS IS STRUCTURED RIGHT NOW, HER

5

CLAIM WOULD BE RELEASED BECAUSE WHAT THEY NEED TO

6

DO IS THEY NEED TO CARVE OUT THAT THIS DOES NOT

7

APPLY TO ANYBODY THAT HAS A PERSONAL INJURY AS A

8

RESULT OF THE RELEASE OF INFORMATION.

9

THE COURT:

THANK YOU, MR. HARRIS.

10

OTHERS WHO HAVE OBJECTIONS WANT TO SPEAK?

11

MR. FURMAN:

12

YOUR HONOR, JOSHUA FURMAN

FOR JOHN ZIMMERMAN, OBJECTOR.

13

YOUR HONOR, FIRST OF ALL, I APOLOGIZE TO

14

THE COURT.

15

WE STATED TO THE COURT THAT THERE WERE SO-CALLED

16

CONFIRMATORY DISCOVERY OR NEGOTIATIONS THAT TOOK

17

PLACE AT THE DEFENDANT'S OFFICE.

18
19
20

THERE WAS A MISSTATEMENT IN OUR BRIEF.

IT WAS PLAINTIFFS' COUNSEL'S OFFICE, SO I
APOLOGIZE TO THE COURT FOR THAT.
THERE'S BEEN A LOT MADE IN THE REPLY

21

BRIEF ABOUT THIS CONTEXT VERSUS RECORD DICHOTOMY

22

AND THAT THERE MIGHT BE A DIFFICULTY TRYING TO GET

23

THESE LAWS TO APPLY TO A PRIVACY DISCLOSURE IN THE

24

SOCIAL MEDIA CONTEXT.

25

THERE REALLY IS VERY LITTLE ABOUT WHAT
22

1

THE CASES SAY ABOUT THAT DICHOTOMY, YOUR HONOR, IN

2

TERMS OF THE CONTENT VERSUS RECORD.

3

THERE ARE TWO DISCRETE CATEGORIES THAT

4

ARE CONSIDERED RECORD AND EXEMPTED, AND ONE THEM IS

5

NOT PHOTOS OF THE INDIVIDUALS.

6

I BELIEVE THAT UNDER THIS, UNDER THE

7

GOOGLE BUZZ PROGRAM, NOT ONLY DO YOU GET THE ACTUAL

8

NAMES, BUT IF IT'S PART OF THEIR PROFILE, YOU GET

9

PHOTOS ALSO OF THESE INDIVIDUALS.

10

SO THAT'S PART OF THE ISSUE THERE.

11

AND THERE'S CERTAINLY NO CASE HOLDING

12

THAT IN A CIVIL CONTEXT THAT THIS INFORMATION IS

13

EXEMPTED FROM THE PROTECTIONS OF THE STORED

14

COMMUNICATIONS ACT.

15

THERE'S ALSO A REALLY FUNDAMENTAL PROBLEM

16

WITH THE CHARACTER OF THE DAMAGES AND THE WAY THAT

17

THE STATUTORY SCHEME ADDRESSES THEM.

18

WE HAVE THE CY PRES ONLY DISTRIBUTION,

19

AND WHEN I SAY "CY PRES ONLY," IT'S NOT JUST THE

20

MONETARY RELIEF THAT'S GOING TO THE CY PRES FUND,

21

IT'S THE ONLY RELIEF.

22

THERE'S -- IN EVERY SINGLE CASE THAT WAS

23

DISCUSSED IN THE BRIEFS THAT CLASS COUNSEL PUT

24

FORWARD, THERE IS SOME DIRECT RELIEF THAT'S GOING

25

TO THE CLASS MEMBERS.
23

1

IN THE PERRY CASE, THEY HAD AN IN KIND

2

DIRECT BENEFIT IN TERMS OF THEY GOT CREDIT

3

REPORTING DIRECT TO THE CLASS MEMBERS.

4
5
6

IN THE INTUIT CASE, THERE WAS SIGNIFICANT
INJUNCTIVE RELIEF.
AND THE OTHER CASES HAVE ALREADY BEEN

7

ADDRESSED, LANE VERSUS FACEBOOK, DOUBLECLICK, THERE

8

WAS SIGNIFICANT INJUNCTIVE RELIEF, AS WELL AS IN

9

THE DELISE CASE.

10
11
12

AND IN THE KEDS CASE, THERE WAS A VERY
STRONG CONSENT DECREE.
ALL THESE THINGS LIMITED WHAT THE

13

DEFENDANT COULD DO FOLLOWING THE ENTRY OF THE

14

SETTLEMENT OR THE CONSENT DECREE.

15

WE DON'T HAVE THAT HERE.

WE'VE GOT THESE

16

CHANGES THAT WERE ALLEGEDLY MADE AND,

17

HYPOTHETICALLY SPEAKING, ONLY HYPOTHETICALLY

18

SPEAKING, THEY COULD LITERALLY SIGN OFF ON

19

RELEASING ALL THESE CLAIMS AND TOMORROW CHANGE THE

20

PROCEDURES BACK TO SOME OTHER WAY.

21

THERE'S NOTHING THAT'S PREVENTING THEM

22

FROM DOING THAT UNDER THIS, UNDER THIS AGREEMENT,

23

SO THAT INJUNCTIVE RELIEF IS COMPLETELY ILLUSORY.

24
25

THE ONLY OTHER THINGS THAT WERE
CONSIDERED INJUNCTIVE RELIEF UNDER THE SETTLEMENT
24

1

AGREEMENT WERE THESE QUASI DISCOVERY ACTS THAT WERE

2

DONE, AND WHICH THEY ARE REQUIRED TO DO ANYWAY IF

3

YOU ACTUALLY SERVE DISCOVERY, AND THIS P.R. PROGRAM

4

THAT I THINK MR. HARRIS -- I BELIEVE THAT WAS HIS

5

NAME -- ADDRESSED THAT THE EDUCATION PROGRAM HAS NO

6

SUPERVISION FROM THE COURT, THERE'S NO WAY FOR THIS

7

COURT TO DETERMINE THAT THAT RELIEF IS ADEQUATE OR

8

THAT IT EVEN TARGETS THE CLASS IN ANY WAY AND IN

9

THAT CY PRES ONLY RELIEF UNDER THESE STATUTES,

10

THESE PRIVACY STATUTES, IS CONTRARY TO THE

11

STATUTORY SCHEME.

12

THE ONLY CASES THAT ARE OUT THERE THAT

13

ADDRESS THIS ISSUE SAY THAT WHEN YOU'VE GOT THESE

14

KIND OF STATUTORY DAMAGES, A CY PRES ONLY SOLUTION

15

IS NOT ACCEPTABLE.

16

THERE'S SOME CRITICISM IN THE RELY BRIEF

17

OF THE SIMER CASE SAYING THAT IT WASN'T WELL CITED.

18

THE SIMER CASE LAYS OUT THESE ISSUES VERY

19

CLEARLY.

20

TIMES BY THE NINTH CIRCUIT, SO I THINK THAT

21

CRITICISM RINGS HOLLOW.

22

IT'S BEEN CITED OVER 200 TIMES, AND FIVE

AND IF CLASS COUNSEL IS CONCERNED THAT

23

THESE -- THAT THERE'S GOING TO BE A HARD TIME

24

APPLYING THESE PRIVACY CASES, THESE PRIVACY LAWS TO

25

THIS KIND OF SITUATION, THEY SHOULD BE EQUALLY
25

1

CONCERNED ABOUT HAVING CY PRES ONLY DISTRIBUTION

2

BECAUSE IT'S NOT BEEN DONE BEFORE.

3

THERE'S SIMPLY NOTHING THAT I WAS ABLE TO

4

FIND, AND NOTHING THAT CLASS COUNSEL CITED, THAT

5

SAYS WE HAVE EVER HAD A CY PRES ONLY DISTRIBUTION

6

WHEN NO RELIEF WHATSOEVER GOES TO THE ACTUAL CLASS

7

MEMBERS.

8

THE COURT:

9

MR. FURMAN:

THANK YOU MR. FURMAN.
AND AGAIN, YOUR HONOR, I

10

WOULD JUST ALSO ECHO THE ISSUE THAT THESE ARE

11

MYSTERY CY PRES RECIPIENTS.

12

ARE AND WE CAN'T DO THE SIX MEXICAN WORKERS

13

ANALYSIS WITHOUT THAT INFORMATION.

WE DON'T KNOW WHO THEY

14

THANK YOU, YOUR HONOR.

15

THE COURT:

16

MR. OSBORN:

17

OTHER OBJECTORS?
DANIEL OSBORN ON BEHALF OF

OBJECTOR RUDGAYZER.

18

GOOD MORNING, YOUR HONOR.

19

THE COURT OBVIOUSLY HAS A LOT OF

20

EXPERIENCE IN CLASS ACTIONS AND IS FULLY --

21

THE COURT:

22

MR. OSBORN:

23
24
25

THIS MORNING ALONE.
I WAS SURPRISED TO SEE THAT

ON THE CALENDAR, FRANKLY.
OBVIOUSLY YOU'RE FAMILIAR WITH THE PHRASE
FAIR, REASONABLE AND ADEQUATE AS THE HALLMARK AND
26

1
2

BENCHMARK FOR APPROVING CLASS ACTION SETTLEMENTS.
I THINK WHAT WE HAVE HERE UNFORTUNATELY,

3

AND MAYBE WHAT THIS HAS EVOLVED TO, IS A BEST WE

4

COULD DO SETTLEMENT.

5

I MEAN NO DISRESPECT TO CLASS COUNSEL.

I

6

DO CLASS ACTIONS FOR A LIVING FOR THE MOST PART.

7

I'VE ONLY OBJECTED ON THREE OR FOUR OTHER OCCASIONS

8

IN MY 22 YEARS, SO I DON'T MAKE A PRACTICE OF THIS.

9

BUT THIS PARTICULAR SETTLEMENT, AS I WENT

10

THROUGH IT WITH MY CLIENT AND MY CO-COUNSEL IN

11

NEW YORK, I SAID THERE'S NOT ENOUGH IN HERE TO GET

12

YOUR ARMS AROUND IN TERMS OF WHAT THEY'RE GETTING.

13
14
15

AND I ECHO IN THE COMMENTS OF MR. STATMAN
AND MR. FURMAN.
YOU LOOK AT THE RELIEF THAT WAS AFFORDED

16

OR GIVEN TO THESE CLASS MEMBERS.

17

HAVE TOLD YOU IT'S THREE PARTICULAR ELEMENTS.

18

IS THE CHANGES TO THE PROGRAM, AS MR. STATMAN, I

19

THINK SAID, HE SAID THERE WERE CHANGES THAT WERE

20

MADE, BUT MOST OF THOSE WERE MADE BEFORE THE FIRST

21

LAWSUIT WAS FILED.

22
23
24
25

CLASS COUNSEL
ONE

GOOGLE BUZZ LAUNCHED ON FEBRUARY 9TH.

ON

FEBRUARY 17TH WAS THE FIRST LAWSUIT.
WE'VE ARTICULATED IN OUR PAPERS THAT FOUR
OF THE FIVE SUPPOSED CHANGES MADE TO GOOGLE BUZZ
27

1

WERE MADE DURING THAT WEEK OF FEBRUARY 9TH TO

2

FEBRUARY 17TH, TWO CHANGES ON THE 11TH, TWO MORE ON

3

THE 13TH, AND WE'VE SET THOSE FORWARD IN OUR BRIEF.

4

THERE IS THIS APRIL 5TH CHANGE THAT IS

5

SORT OF THE PENULTIMATE, YOU KNOW, YOU CAN

6

PARTICIPATE OR NOT PARTICIPATE, BUT EVEN THAT WAS

7

ONLY THE ONE CHANGE.

8
9
10
11
12

AND WHAT'S ODD IS TWO MORE LAWSUITS WERE
FILED EVEN AFTER THAT.
BUT NO CHANGES WERE MADE TO GOOGLE BUZZ
AFTER APRIL 5TH THAT I'M AWARE OF.
THE SETTLEMENT AGREEMENT TALKS ABOUT

13

FURTHER REVISIONS AND SO FORTH, BUT NONE OF THOSE

14

HAVE BEEN IDENTIFIED.

15

THE SECOND ASPECT OF THE RELIEF IS THIS

16

PUBLIC EDUCATION.

17

AGREEMENT, IT SAYS, FOR THE MOST PART, ALL OF THAT

18

WILL BE DECIDED, AGREED UPON, AND IMPLEMENTED AFTER

19

THE SETTLEMENT IS FINALLY APPROVED.

20
21
22

WHEN YOU LOOK AT THE SETTLEMENT

AGAIN, CLASS MEMBERS ARE LEFT WITHOUT
ANYTHING TO REALLY GET THEIR ARMS AROUND.
THE THIRD ASPECT IS THE CY PRES.

YOU'VE

23

ALREADY HEARD ABOUT THE FACT THAT THE IDENTIFY OF

24

THE CY PRES RECIPIENTS IS NOT KNOWN AT THIS POINT

25

IN TIME, TO BE DECIDED UPON LATER, AMOUNTS AND
28

1

ALLOCATIONS TO ANY PARTICULAR CY PRES RECIPIENT TO

2

BE DECIDED UPON LATER.

3

YOU'RE ASKING CLASS MEMBERS TO DECIDE

4

NOW, OPT IN OR EXCLUDE YOURSELF, WHAT HAVE YOU, TO

5

A SETTLEMENT THAT IS REALLY SORT OF VAGUE IN TERMS

6

OF THE DETAILS.

7

THERE ARE OTHER ASPECTS OF THIS CASE I

8

THINK THAT SHOULD CAUSE THE COURT TO PAUSE AND

9

MAYBE SCRATCH YOUR HEAD.

10
11

MR. STATMAN MENTIONED THE CLASS AND THE
CLASS PERIOD.

12

THE LAWSUIT WAS FILED ON FEBRUARY 17TH;

13

LAST CHANGE IMPLEMENTED APRIL 5; SETTLEMENT

14

AGREEMENT, THE MEDIATION, WAS CONDUCTED AND

15

CONCLUDED ON JUNE 2ND; AND YET WE HAVE A SETTLEMENT

16

CLASS THAT RUNS ANOTHER FIVE MONTHS TO NOVEMBER.

17

THERE'S NO REASON TO INCLUDE ALL OF THOSE

18

FOLKS, AND I'M NOT SURE WHY -- I UNDERSTAND THE

19

DEFENDANTS, FROM HAVING DONE THIS WORK, DEFENDANTS

20

WANT THE BROADEST RELEASE POSSIBLE, AND THAT'S

21

FINE.

22
23

IT DOESN'T NECESSARILY MEAN, FROM THE
PLAINTIFF'S SIDE, THAT YOU AGREE TO IT.

24

ANOTHER THING I THINK THAT SHOULD CAUSE

25

THE COURT A LITTLE PAUSE IS THERE'S SOME QUESTION
29

1

AS TO THE SIZE OF THE CLASS, AND I FOUND IT

2

INTERESTING THAT WHEN YOU READ THE COMPLAINT, THE

3

BASIS FOR THE SIZE OF THE CLASS IS AN ARTICLE FROM

4

A JOURNAL THAT TALKS ABOUT POTENTIAL NUMBER OF

5

USERS OF GMAIL.

6

IT DOESN'T EVEN TALK ABOUT GMAIL ACCOUNT

7

HOLDERS.

8

THERE'S SOME 37 OR 32 MILLION FIGURE THAT'S

9

DISCLOSED IN THERE.

10

IT TALKS ABOUT PERSONS USING GMAIL, AND

THERE'S NEVER ANY DISPOSITIVE PIECE OF

11

INFORMATION THAT'S GIVEN TO CLASS MEMBERS TO

12

UNDERSTAND THE PRECISE SIZE OF THE CLASS.

13

JUST THIS ESTIMATE BASED ON A JOURNAL ARTICLE.

14

IT'S

TODAY WE'RE HEARING FOR THE FIRST TIME,

15

AND AS I SAT IN THE SECOND ROW I WAS KIND OF

16

CONCERNED, WE'RE HEARING THAT THE CLASS SIZE

17

PROBABLY ISN'T 37 MILLION.

18

PEOPLE BECAUSE NOT EVERY ACCOUNT HOLDER WAS

19

IMPACTED; AND WITHIN THAT SUBSET, IT'S PROBABLY

20

ANOTHER SUBSET OF PEOPLE.

21

IT'S SOME SUBSET OF

SO NOW WE'RE ASKED TO AGREE TO A

22

SETTLEMENT, OR AT LEAST A SETTLEMENT IS PUT BEFORE

23

THE COURT FOR APPROVAL WHERE I DON'T THINK WE

24

REALLY HAVE ANY IDEA WHAT THE SIZE OF THE CLASS IS.

25

I REALLY DON'T THINK THAT THAT INFORMATION HAS BEEN
30

1

CAPTURED.

2

AND JUST ONE OTHER POINT BECAUSE I THINK

3

EVERYTHING ELSE HAS BEEN ARTICULATED BY THE OTHER

4

GENTLEMEN.

5

THERE HAS BEEN A LOT MADE BY THE

6

PLAINTIFFS' COUNSEL OF THE FACT THAT THERE ARE

7

NO -- BASED UPON THEIR REVIEW OF THE MATERIALS THAT

8

HAVE BEEN PROVIDED TO THEM AND THEIR INVESTIGATION,

9

THERE'S NO CLAIM OF ACTUAL DAMAGES SUFFERED BY

10
11

ANYBODY.
MR. STATMAN OR MR. FURMAN POINTED OUT

12

THAT, IN FACT, THERE IS THAT ONE OBJECTOR WHO

13

ARTICULATED THE IDENTITY THEFT OBJECTION.

14

WHEN YOU LOOK AT THE COMPLAINT ITSELF AT

15

PARAGRAPH 30, THERE ARE THREE OR FOUR EXAMPLES OF

16

PERSONS WHO PURPORTEDLY SUFFERED SOME SORT OF

17

DAMAGE, AND THEN WE HEAR THAT STORY THIS MORNING.

18

SO I THINK THERE IS A PROBLEM WITH THE

19

SCOPE OF THE RELEASE, IT'S OVERLY BROAD, AND IT

20

DOES NEED TO BE CARVED OUT, I BELIEVE, FOR ANYBODY

21

WHO MAY HAVE SUFFERED A PERSONAL INJURY LIKE THAT

22

ARTICULATED BY MR. STATMAN.

23

THE COURT:

24

MR. OSBORN:

25

THANK YOU.
SORRY, IF I CAN MAKE ONE

LAST POINT, YOUR HONOR.
31

1

ON THE FEES -- I HATE TO PICK ON FEES

2

BECAUSE I DO THIS FOR A LIVING AND I WOULD HATE FOR

3

SOMEBODY TO BE STANDING HERE PICKING ON MY FEES --

4

BUT IT'S UNUSUAL FOR ME TO SEE AN APPLICATION, FEE

5

APPLICATION, WITH ONLY SUMMARY TIME RECORDS,

6

DECLARATIONS RATHER, THAT SAY "I WORK FOR THIS

7

FIRM, I WORKED 20 HOURS AT $400 AN HOUR, $8,000."

8
9
10

IN THE CASES I WORK ON, WE'RE REQUIRED TO
SUBMIT DETAILED TIME RECORDS TO SEE WHAT WORK WAS
DONE.

11

I THINK THAT IS PARTICULARLY IMPORTANT

12

HERE GIVEN THE FACT THAT BY JUNE 2ND, THREE AND A

13

HALF MONTHS AFTER THE FIRST LAWSUIT WAS FILED, THIS

14

CASE WAS SETTLED.

15

NOW, I KNOW THERE'S WORK THAT'S DONE

16

AFTERWARD TO IMPLEMENT THE SETTLEMENT AGREEMENT,

17

BUT CLASS COUNSEL IS NOT SUPPOSED TO BE COMPENSATED

18

FOR THAT WORK.

19

CASE.

20

THAT'S JUST PART OF TAKING ON THE

SO I THINK IT'S IMPORTANT THAT THE COURT

21

ACTUALLY SEE THE TIME AND THE WORK THAT WAS

22

PERFORMED BY THE ATTORNEYS.

23

THANK YOU, YOUR HONOR.

24

THE COURT:

25

THANK YOU.

I HAVE OTHER

MATTERS I HAVE TO ATTEND TO, BUT I DIDN'T WANT TO
32

1

DEPRIVE ANY OTHER OBJECTORS WHO HAVE ANY NEW OR

2

DIFFERENT OBJECTIONS.

3

I HAD MS. GACHOT WHO MADE AN APPEARANCE.

4

I UNDERSTAND THAT THERE'S A MR., OR ATTORNEY

5

DARRELL PALMER WHO'S HERE ON BEHALF OF AN OBJECTOR.

6

ANYONE ELSE?

7

YES, MA'AM.

8

MS. GACHOT:

9

NATALIE GACHOT APPEARING IN

PRO PER.

10

AND MOST OF --

11

THE COURT:

12

MS. GACHOT:

13

THE COURT:

14
15
16
17

YOU'RE REPRESENTING YOURSELF?
YES.
THANK YOU, MA'AM.

YOU'RE A

LAWYER, THOUGH?
MS. GACHOT:

YES.

MOST OF MY OBJECTIONS

HAVE ALREADY BEEN COVERED BY OTHER OBJECTORS.
HOWEVER, I'D LIKE TO MAKE A POINT THAT I

18

THINK THERE WAS INSUFFICIENT INVESTIGATION INTO

19

WHETHER OR NOT THE MEMBERS OF THE CLASS SUFFERED

20

OUT-OF-POCKET DAMAGES OR DAMAGES IN GENERAL.

21

THEY WERE BASED ON 2,000 E-MAILS WHICH

22

WERE VOLUNTARILY GIVEN TO GOOGLE, KIND OF COMMENTS

23

OR, I GUESS, OPINIONS ABOUT GOOGLE BUZZ GIVEN

24

VOLUNTARILY TO GOOGLE, AND THAT REPRESENTS JUST A

25

VERY, VERY SMALL AMOUNT OF THE ACTUAL CLASS SIZE.
33

1

THE COURT:

2

YES?

3

MR. MURPHY:

4

THE COURT:

5

THANK YOU VERY MUCH.

MR. MURPHY:

I'M ALSO AN OBJECTOR.
SPEED.
MY NOTES ARE BRIEF.

MY NAME

6

IS RYAN MURPHY, AND I HAVE -- I DO HAVE SOMETHING

7

SLIGHTLY DIFFERENT TO SAY, AND IT'S IN THE --

8
9

THE COURT:

TELL ME WHAT IT IS.

DON'T

TELL ME --

10

MR. MURPHY:

IT'S IN THE FRAMEWORK OF THE

11

IDEA OF THE PRIVATE ATTORNEY GENERAL WHICH YOU

12

NOTED.

13

SO I THINK THAT THERE ARE -- THE DYNAMIC

14

OF THIS CASE HAS TWO MAIN -- THERE ARE TWO FEATURES

15

THAT ARE SALIENT TO ME.

16

COUNSEL, THIS IS LOW RISK LITIGATION.

17

ONE IS THAT FOR THE CLASS

THE SECOND IS THAT THIS SETTLEMENT

18

DOESN'T FORCE OR EVEN ENCOURAGE GOOGLE TO

19

INTERNALIZE THE COST OF ITS BEHAVIOR, TO FACTOR IN

20

GMAIL USERS' PRIVACY CONCERNS INTO THE CALCULUS OF

21

THEIR BUSINESS DECISIONS.

22

AND SO IF YOU LOOK AT THE RELATIVE

23

BENEFITS AND LOSSES, THE AVERAGE PAY OUT TO THE 11

24

FIRMS IS ABOUT $200,000 PER FIRM, ALTHOUGH FOR THE

25

TOP FOUR FIRMS, THAT'S -- THE AVERAGE IS $430,000
34

1
2

PER FIRM.
THE AVERAGE HOURLY RATE, IF WE'RE

3

INCLUDING THE MULTIPLIER FOR ALL THE FIRMS, IS

4

ABOUT $870 PER HOUR.

5

THE LOSS TO GOOGLE IS ABOUT -- IS 8 -- IS

6

$8.5 MILLION, WHICH IS ALMOST EXACTLY ONE

7

ONE-THOUSANDTH OF THEIR 2010 NET INCOME, WHICH IS

8

NOT THEIR REVENUE, IT'S THEIR NET INCOME, AND I GOT

9

THAT FROM THEIR WEBSITE, WHICH IS 8 AND A HALF

10
11

BILLION DOLLARS.
SO IT'S A RATHER SAFE BET THAT FACED WITH

12

THE POSSIBILITY OF OWING STATUTORY DAMAGES TO A

13

POOL OF 32 OR 37 MILLION PEOPLE, A MASSIVE COMPANY

14

LIKE GOOGLE WILL HAND OVER A THOUSANDTH OF ITS

15

ANNUAL INCOME, AND THAT GOOGLE WILL PAY THAT

16

AMOUNT, WHICH IS ONLY A SMALL AMOUNT, AND THAT

17

GOOGLE WILL HAVE NO OBLIGATION TO CHANGE GOOGLE

18

BUZZ, AND THAT THEY'LL BE IMMUNIZED FROM FUTURE

19

LITIGATION MEANS THAT IF WE WENT BACK IN TIME ONE

20

YEAR AND TOLD GOOGLE THAT THE COST OF CHANGING BUZZ

21

WOULD BE THIS SETTLEMENT, THEY WOULD HAVE NO

22

INCENTIVE TO DO ANYTHING DIFFERENT.

23

AND ACTUALLY WE KIND OF KNOW THAT BECAUSE

24

THEY HAVE NONE -- THEY HAVE REALLY DONE NOTHING

25

DIFFERENT SINCE THE START OF THIS LITIGATION.
35

1

SO THAT'S VERY QUICKLY THE REASONS WE,

2

MYSELF AND TWO OF MY COLLEAGUES, ARE HERE, BECAUSE

3

WE BELIEVE THAT THIS IS NOT AN ADEQUATE SETTLEMENT.

4

THANK YOU.

5

THE COURT:

VERY WELL.

SO LET ME HAVE

6

THE PARTIES BACK AND ADDRESS NOT ALL OF THIS, BUT

7

THERE ARE A COUPLE THINGS THAT I DID WANT TO HEAR

8

YOU ADDRESS IN PARTICULAR, BUT BRIEFLY.

9

I MIGHT ACTUALLY ASK FOR SUPPLEMENTAL

10

BRIEFING ON THIS IF I CAN'T GET A BRIEF

11

EXPLANATION.

12

THE ONE CONCERN THAT I'VE HEARD IS THAT

13

THE SETTLEMENT DOES NOT PROVIDE ANY DETAIL OF

14

GOOGLE'S PUBLIC EDUCATION EFFORT, THAT THERE'S NO

15

MECHANISM FOR ENSURING THAT IT IS GOING IN A

16

FASHION THAT BENEFITS THE CLASS.

17

AND THEN THERE'S A QUESTION THAT I WOULD

18

WISH YOU TO ADDRESS HAVING TO DO WITH -- IT WAS THE

19

ONE I INITIALLY ASKED, WHICH IS, WHAT CHANGE IS

20

BEING MADE?

21

AND THEN AS I UNDERSTAND IT, ONE OF THE

22

OBJECTIONS IS THERE'S NO REQUIREMENT THAT IT BE

23

PERMANENT, EVEN IF IT IS -- IF THERE IS A CHANGE

24

THAT'S BEING MADE.

25

AND THERE ARE SOME OTHER QUESTIONS THAT
36

1

CAME UP HAVING TO DO WITH WHETHER, IN A RELATIVELY

2

SHORT LITIGATION, THE FULL AMOUNT OF FEES UP TO THE

3

NINTH CIRCUIT BENCHMARK IS WARRANTED.

4

MR. RUBENSTEIN:

YES, SIR.

5

FIRST OF ALL, ON THE PUBLIC EDUCATION

6

CAMPAIGN, WE BELIEVE, AND WE'VE BRIEFED THIS, WE

7

BELIEVE THERE IS AN ACCOUNTABILITY MECHANISM BUILT

8

INTO THAT.

9

WE -- GOOGLE WILL TAKE RECOMMENDATIONS

10

FOR THE PUBLIC EDUCATION CAMPAIGN FROM US.

11

ALREADY MADE SOME.

12
13
14

WE'VE

THEY'VE SUGGESTED THEY'RE OPEN TO HEARING
FROM ANYONE ABOUT THE IDEA OF IT.
THEY THEN HAVE TO REPORT BACK TO US, IT'S

15

WRITTEN INTO THE AGREEMENT, THEY HAVE TO REPORT

16

BACK TO CLASS COUNSEL WHAT THEY DID IN THE PUBLIC

17

EDUCATION CAMPAIGN.

18

IF WE BELIEVE THAT IT'S A BREACH OF THE

19

CONTRACT OF THE SETTLEMENT AGREEMENT, THAT IT

20

WASN'T DONE IN GOOD FAITH, THE PUBLIC EDUCATION

21

CAMPAIGN, WE WILL TELL GOOGLE THAT.

22

IF THEY DISAGREE, THERE'S A DISPUTE

23

RESOLUTION MECHANISM IN THE SETTLEMENT.

WE GO

24

BEFORE JUDGE SMITH AND WE TRY TO WORK OUT WITH HER

25

WHETHER OR NOT THEY'VE LIVED UP TO THEIR
37

1

CONTRACTUAL OBLIGATION TO DO THE PUBLIC EDUCATION.

2

AND, OF COURSE, FAILING ANY AGREEMENT

3

THERE, WE COME BACK TO THE COURT AND WE BRING IT TO

4

YOU AND SAY "WE DON'T THINK THEY LIVED UP TO THEIR

5

CONTRACTUAL OBLIGATION TO DO THE PUBLIC EDUCATION

6

CAMPAIGN."

7

WE DON'T THINK THIS IS A MEANINGLESS,

8

HOLLOW THING.

WE THINK THERE'S A BUILT-IN

9

ACCOUNTABILITY MECHANISM.

WE SPECIFICALLY WROTE

10

INTO THIS THAT THEY HAVE TO REPORT BACK TO US ON

11

EXACTLY WHAT THEY DID, AND WE HAVE THE DISPUTE

12

RESOLUTION MECHANISM IN PLACE WITH REGARD TO THAT.

13

SECOND, AS TO THE CHANGES IN THE PROGRAM,

14

YOUR HONOR, I'M HAPPY TO GO THROUGH THEM WITH YOU

15

AGAIN.

I THINK THE MAIN --

16

THE COURT:

DON'T GO THROUGH THEM, JUST

17

WHETHER THERE'S ANY REQUIREMENT THAT THEY BE

18

PERMANENT.

19

MR. RUBENSTEIN:

THERE'S NOTHING IN THE

20

SETTLEMENT AGREEMENT THAT REQUIRES THEM TO BE

21

PERMANENT.

22

I WILL SAY, YOUR HONOR, IF, IN FACT, THE

23

DAY AFTER FINAL APPROVAL IS GRANTED, SHOULD IT BE

24

THAT GOOGLE THEN CHANGED THE BUZZ PROGRAM BACK AND

25

MADE IT THAT THEY'RE AUTOMATICALLY RELEASING, WHICH
38

1

IT NEVER WAS THAT, BUT IF THEY AUTOMATICALLY

2

RELEASED USER INFORMATION, I THINK WE'D COME BACK

3

BEFORE THE COURT AND SAY IT'S OUT OF LINE WITH THE

4

SETTLEMENT.

5

THE COURT:

BUT I WOULDN'T HAVE ANY

6

ENFORCEMENT AUTHORITY UNLESS THERE IS SOME

7

REQUIREMENT.

8
9

BUT I GUESS THE ULTIMATE QUESTION THAT'S
BEING RAISED, AND IT'S THE ONE I RAISED AT THE

10

PRELIMINARY APPROVAL, IS THE NATURE OF THIS IS A

11

(B)(3) CLASS.

12

IT DOES SEEM TO THE COURT THAT ONE VIEW

13

THAT THE COURT COULD TAKE OF THIS IS THAT THE

14

EDUCATIONAL PROCESS, THE CY PRES PROCESS, WHATEVER

15

THAT IS, IS ALL DESIGNED FOR INJUNCTIVE TYPE

16

RELIEF.

17

THIS IS NOT MONEY THAT IS BEING GIVEN TO

18

THE CY PRES ORGANIZATIONS AS DAMAGES FOR THE

19

BENEFIT OF THE CLASS MEMBERS.

20

THE MONIES THAT ARE BEING GIVEN ARE VERY

21

MUCH TO BE AN EDUCATIONAL BENEFIT FOR INTERNET

22

PRIVACY, AND I CAN UNDERSTAND THAT.

23

AS I HEAR IT, THE REASON THIS IS BEING

24

JUSTIFIED AS A (B)(3) CLASS IS, NUMBER ONE, THERE

25

ARE POTENTIAL DAMAGE CLAIMS THAT COULD BE BROUGHT,
39

1

AND ALTHOUGH THE DAMAGES WOULD BE SMALL, THERE ARE

2

DAMAGES, AND SO THIS IS A SETTLEMENT WHICH IS

3

DESIGNED TO TAKE THOSE SMALL AMOUNTS OF DAMAGES,

4

AGGREGATE THEM INTO AN AMOUNT AND PUT IT IN SORT OF

5

A FUND THAT CAN BE USED FOR INTERNET PRIVACY POLICY

6

AND EDUCATION, AND I'M CONSIDERING IT IN THAT

7

LIGHT.

8
9

AT THE SAME TIME, AS I NOTED AT THE
PRELIMINARY HEARING, IT'S UNUSUAL.

IT'S UNUSUAL

10

FOR THE COURT TO ASK INDIVIDUALS TO GIVE UP THEIR

11

PERSONAL INJURY OR OTHER DAMAGE CLAIMS IN A

12

CIRCUMSTANCE WHERE THEY ARE NOT RECEIVING THOSE

13

DAMAGES, AND I'M NOT SURE I UNDERSTAND WHY THEY

14

WOULD NOT BE ENTITLED TO RECEIVE THEM, HOWEVER

15

SMALL.

16

I JUST APPROVED ONE WHERE THE AMOUNTS ARE

17

RELATIVELY SMALL COMPARED TO THE KINDS OF CLAIMS

18

THAT PEOPLE MIGHT FEEL THEY HAVE HAVING TO DO WITH

19

THEIR MORTGAGES OR OTHER MATTERS.

20
21

SO YOU WANT TO ADDRESS THE (B)(3) ASPECT
OF THIS?

22

MR. RUBENSTEIN:

YES, YOUR HONOR.

23

I DISAGREE WITH ONE THING THAT YOU SAID

24

IN CHARACTERIZING IT.

I THINK THAT WE HAVE

25

RECEIVED MONEY DAMAGES FOR THE CLASS.

WE'VE
40

1

RECEIVED $8.5 MILLION FOR THIS CLASS.

2
3

GOOGLE HAS GIVEN UP THAT AMOUNT.

THAT

SERVES AS A DETERRENT EFFECT.

4

THE ONLY REASON, THE ONLY REASON THE

5

CLASS MEMBERS ARE NOT GETTING THE MONEY HERE IS

6

THAT THERE ARE 37 MILLION OF THEM.

7

THIS IS NOT UNUSUAL.

THIS HAPPENS ALL

8

THE TIME.

THIS IS VERY TYPICAL IN ANTITRUST

9

SETTLEMENTS, FOR INSTANCE, YOUR HONOR.

WHERE THERE

10

ARE LARGE CLASSES AND THE DAMAGES CANNOT BE

11

DISTRIBUTED TO THE CLASS, 100 PERCENT OF THE MONEY

12

IS SENT CY PRES.

13

THERE'S NOTHING ABOUT IT THAT'S

14

NEFARIOUS.

15

THE FACT THAT WE'RE REPRESENTING 37 MILLION PEOPLE.

16
17
18

IT'S SIMPLY A MATTER OF DIVISION AND

SO WE HAVE RECEIVED MONEY DAMAGES AND
IT'S A STANDARD (B)(3) CLASS ACTION.
THE REASON WE CAN'T DISTRIBUTE THE MONEY

19

IS SOLELY THE AMOUNT OF MONEY DIVIDED BY THE AMOUNT

20

OF PEOPLE IN THE CLASS.

21

LIKE ANY ANTITRUST SETTLEMENT OF THIS

22

TYPE, WE CITE A NUMBER OF CASES IN OUR FINAL

23

APPROVAL BRIEF AND RELY BRIEF WHERE MONIES GO 100

24

PERCENT CY PRES AND THEY'RE CERTIFIED AS (B)(3)

25

CASES JUST LIKE THIS ONE.
41

1

REMEMBER, IN OUR FINAL APPROVAL BRIEF, WE

2

GIVE FIVE REASONS THIS SHOULD BE A (B)(3) CLASS.

3

THE FIRST IS IT FITS THE LANGUAGE OF (B)(3) IN THAT

4

COMMON ISSUES PREDOMINATE AND THE CLASS MECHANISM

5

IS SUPERIOR; SECOND, WE DO HAVE MONEY DAMAGES, WE

6

JUST CAN'T DISTRIBUTE THEM BECAUSE OF THE NUMBER OF

7

PEOPLE IN THE CLASS; THIRD, THERE IS NO INJUNCTIVE

8

RELIEF TO DO THIS UNDER (B)(2); FOURTH, WE WANTED

9

TO DO IT (B)(3), REMEMBER, SO PEOPLE COULD OPT OUT,

10

AND 500 AND SOME PEOPLE OPTED OUT OF THE CLASS; AND

11

FIFTH, IN SITUATIONS LIKE THIS WHEN THE AMOUNT OF

12

MONEY IS TOO SMALL TO DISTRIBUTE TO ALL OF THE

13

MEMBERS OF CLASS, IT'S TYPICAL TO CERTIFY AS (B)(3)

14

BECAUSE IT IS A MONEY CASE.

15

PROBLEM IS SOLELY A PROBLEM OF THE NUMBER OF PEOPLE

16

IN THE CLASS.

17

THE DISTRIBUTION

YOUR HONOR, I DO THINK THAT THE PRIVATE

18

ATTORNEY GENERAL MECHANISM THAT YOU WERE DISCUSSING

19

IN THE LAST CASE IS APPROPRIATE TO THINK ABOUT IN

20

THIS CONTEXT.

21

CASE.

22

FOR AN ENORMOUS CLASS.

23

OF THE CITIZENS OF THE STATE OF CALIFORNIA.

24
25

THAT IS WHAT WE'RE DOING IN THIS

WE'RE SERVING AS PRIVATE ATTORNEY GENERALS
A CLASS OF THIS SIZE IS ALL

WHAT WE'VE DONE HERE IS CREATE A
DETERRENT EFFECT IN SITUATIONS LIKE THIS WHERE
42

1

DEFENDANTS THAT LAUNCH INTERNET PROGRAMS THAT HAVE

2

PRIVACY CONCERNS, WE HOPE, WILL BE MORE SENSITIVE

3

TO THOSE CONCERNS IN THE FUTURE BECAUSE OF THE,

4

ESSENTIALLY THE FINE THEY HAVE TO PAY HERE.

5

LIKE A PRIVATE ATTORNEY GENERAL, WE'VE

6

SECURED JUST THE TYPES OF RELIEF THAT ARE

7

APPROPRIATE IN SMALL CLAIMS CASES SUCH AS THIS, AND

8

WE THINK THIS SETTLEMENT FITS THE DYNAMICS OF A

9

SMALL CLAIMS CLASS ACTION QUITE APPROPRIATELY IN

10

THAT SENSE.

11

MS. FAHRINGER:

ONLY ONE OBSERVATION IN

12

ANSWER TO YOUR THREE QUESTIONS ABOUT EDUCATION AND

13

CHANGES.

14

CHANGES IN PARTICULAR -- AS TO THE

15

QUESTION WHETHER INJUNCTIVE RELIEF SHOULD BE

16

REQUIRED TO PRESERVE GOOGLE BUZZ AS IS RATHER THAN

17

HAVING IT REVERT BACK TO THE WAY THE COMPLAINT

18

ALLEGES IT WORKED, GOOGLE BUZZ NEVER WORKED THE WAY

19

THE COMPLAINT ALLEGED IT WORKED.

20

DISCLOSED E-MAIL ADDRESSES PUBLICLY.

21

THE THINGS ALLEGED IN THE COMPLAINT.

22

IT NEVER
IT NEVER DID

AND SO IT IS VERY UNLIKELY THAT GOOGLE

23

WOULD EVER CAUSE THE PROGRAM TO BE CHANGED TO ALIGN

24

TO THE PROGRAM AS ALLEGED IN THE COMPLAINT.

25

MR. RUBENSTEIN:

YOUR HONOR, YOU HAD ONE
43

1

LAST QUESTION ABOUT THE FEE REQUEST BEING A

2

BENCHMARK, AND LEAD COUNSEL WILL ADDRESS THAT.

3

MR. MASON:

VERY BRIEFLY, YOUR HONOR,

4

WE'VE ASKED FOR 25 PERCENT.

5

PERCENT, BUT WE THOUGHT 25 PERCENT, THE BENCHMARK,

6

WAS APPROPRIATE IN THIS CASE GIVEN ALL THE

7

CIRCUMSTANCES.

8

WE NEGOTIATED 30

OF IMPORTANCE AND WHAT MAKES THIS CASE A

9

LITTLE BIT DIFFERENT THAN MAYBE EVEN SOME OF THE

10

CASES THAT YOU SAW THIS MORNING IS THERE ARE FIVE

11

COMPLAINTS THAT ARE ON FILE, THREE OF WHICH WERE

12

FILED PRIOR TO THIS COURT CONSOLIDATING THE CASES

13

AND MAKING MYSELF LEAD COUNSEL, TWO OF WHICH CAME

14

AFTERWARDS.

15

THERE'S MORE THAN TEN LAW FIRMS INVOLVED,

16

AND AS LEAD COUNSEL, I'VE BEEN VERY DILIGENT ABOUT

17

WATCHING EVERYBODY'S TIME, MAKING SURE THAT IT'S

18

NOT DUPLICATIVE.

19

WE'VE BASICALLY, YOU KNOW, KEPT VERY

20

SMALL THE NUMBER OF LAWYERS WHO HAVE BEEN DOING THE

21

WORK SINCE THE CONSOLIDATION.

22

BUT NONETHELESS, GIVEN THE NUMBER OF LAW

23

FIRMS INVOLVED, GIVEN THE SUBSTANTIAL BRIEFING WE

24

DID IN CONNECTION WITH THE MEDIATION, AS WELL AS

25

THE PRELIMINARY APPROVAL, FINAL APPROVE BRIEF, AND
44

1

NOW THE REPLY BRIEF, THE TIME DOES ADD UP.

2

JUST -- THAT'S SOMETHING THAT NOBODY CAN CONTROL

3

THAT EFFECTIVELY AT SOME LEVEL.

4

IT'S

THE LODESTAR, AS REPORTED INITIALLY, WAS

5

ABOUT 1.3 MILLION, WHICH LED TO A MULTIPLIER OF

6

1.67, WHICH IS WELL WITHIN THE RANGE OF

7

MULTIPLIERS.

8

MY BACK-OF-THE-ENVELOPE CALCULATION OF

9

WHERE WE ARE NOW AFTER DOING ADDITIONAL BRIEFING

10

IS CLOSER TO 1.5, WHICH HAS LOWERED THE MULTIPLIER

11

TO ALSO ABOUT 1.5.

12

AND OF COURSE THERE'S GOING TO BE

13

ADDITIONAL WORK GOING FORWARD, PARTICULARLY WITH

14

THE CY PRES AND POTENTIALLY WITH APPEALS.

15

SO BASICALLY, YOUR HONOR, WE'RE JUST

16

ASKING FOR A VERY MODEST MULTIPLIER, IF ANY, OVER

17

THE LODESTAR THAT HAS ACCRUED IN THIS CASE.

18
19
20

THE COURT:

VERY WELL.

I'M PREPARED TO

TAKE THIS UNDER SUBMISSION.
AS I SAID, I MIGHT ASK FOR SUPPLEMENTAL

21

BRIEFING BEFORE I GIVE FINAL APPROVAL, AND THE

22

ORDER THAT I GIVE FOR FINAL APPROVAL MIGHT BE A

23

LITTLE DIFFERENT THAN WHAT I HAVE GIVEN THE

24

IMPORTANCE OF THE CY PRES RECIPIENTS.

25

MY STAFF MIGHT HAVE ALERTED YOU TO THIS
45

1

ALREADY.

2

MAKE THE FINAL DECISION AS TO WHO THOSE RECIPIENTS

3

ARE AND RECEIVE NOMINATIONS FROM THE PARTIES, AND

4

PERHAPS THERE COULD BE A WAY OF INCLUDING THE CLASS

5

IN SOME WAY IN THAT, AT LEAST AS TO NOTICE OF ALL

6

OF THAT.

7

ALERT PEOPLE TO WHAT THE COURT IS CONSIDERING DOING

8

AND ACTUALLY GET SOME FEEDBACK TO THAT PROCESS.

9
10
11

THE COURT WOULD TAKE IT UPON ITSELF TO

WITH TODAY'S TECHNOLOGY, IT'S EASY TO

I HAVEN'T THOUGHT ABOUT THAT YET, BUT I
WILL.
AND SO I'LL SEND YOU A DRAFT OF MY

12

PROPOSED ORDER, GET YOUR COMMENTS ON IT, AND THEN

13

PUT IT IN PLACE AFTER I RECEIVE THAT.

14

MR. RUBENSTEIN:

THANK YOU, YOUR HONOR.

15

ONE THING TO NOTE.

IN OUR FINAL APPROVAL

16

BRIEF, WE MENTIONED, AS TO THE CY PRES PROCESS,

17

THAT WE'D BE WORKING WITH AN INDEPENDENT

18

ORGANIZATION TO HELP US IDENTIFY CY PRES

19

RECIPIENTS, AND WE HOPE TO RECEIVE A BROAD CROSS

20

SECTION OF CY PRES RECIPIENTS AND DISTRIBUTE THE

21

MONEY WIDELY ACROSS THE COUNTRY.

22

THERE'S A LARGE AMOUNT OF MONEY HERE, AND

23

WE HAVE A CLASS THAT ENCOMPASSES THE WHOLE COUNTRY,

24

SO WE HOPE TO HAVE A GOOD SLATE OF -- A BROAD RANGE

25

OF CY PRES RECIPIENTS.
46

1

THE COURT:

2

GOOGLE PART OF THIS.

3

SPECIFICITY WITH RESPECT TO THAT PART OF IT.

4

AND I DIDN'T SPEAK TO THE
I DO INTEND TO SEEK SOME MORE

IT DOES SEEM TO ME THAT IF I HAVE TO PLAY

5

ANY ROLE IN ASSESSING WHETHER OR NOT THEY HAVE

6

COMPLIED WITH THE TERMS, I NEED TO HAVE THOSE TERMS

7

MORE EXPLICITLY STATED, AND SO I MIGHT ASK FOR MORE

8

SPECIFICITY FROM THE PARTIES BEFORE I GIVE YOU MY

9

FINAL JUDGMENT ON THAT PART AS WELL.

10

MR. RUBENSTEIN:

11

THE COURT:

12

MS. FAHRINGER:

13

(WHEREUPON, THE PROCEEDINGS IN THIS

14

THANK YOU, YOUR HONOR.

MATTER SUBMITTED.
THANK YOU, YOUR HONOR.

MATTER WERE CONCLUDED.)

15
16
17
18
19
20
21
22
23
24
25
47

1
2
3
4

CERTIFICATE OF REPORTER

5
6
7
8
9

I, THE UNDERSIGNED OFFICIAL COURT
REPORTER OF THE UNITED STATES DISTRICT COURT FOR

10

THE NORTHERN DISTRICT OF CALIFORNIA, 280 SOUTH

11

FIRST STREET, SAN JOSE, CALIFORNIA, DO HEREBY

12

CERTIFY:

13

THAT THE FOREGOING TRANSCRIPT,

14

CERTIFICATE INCLUSIVE, CONSTITUTES A TRUE, FULL AND

15

CORRECT TRANSCRIPT OF MY SHORTHAND NOTES TAKEN AS

16

SUCH OFFICIAL COURT REPORTER OF THE PROCEEDINGS

17

HEREINBEFORE ENTITLED AND REDUCED BY COMPUTER-AIDED

18

TRANSCRIPTION TO THE BEST OF MY ABILITY.

19
20
21
22
23
24
25

/S/
_____________________________
LEE-ANNE SHORTRIDGE, CSR, CRR
CERTIFICATE NUMBER 9595

48