Data-Centric Marketers Should Keep Eye on Spokeo Supreme Court Case

Case Against Spokeo Could Have Implications for Lots of Data Collectors

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Some consumers think it's bad enough when companies gather their data and use it to target what marketers would call "more relevant" ads. What do they dislike even more? When the data is wrong.

Now the Supreme Court is on the case. The high court on Monday said it would hear a case involving people-data-search firm Spokeo.com. In a nutshell, Virginia resident Thomas Robins sued Spokeo, claiming that incorrect data on his age and employment status among other things prevented him from getting hired. (It said he was employed though he wasn't.)

A district court ruled he had no right to sue, then that was overturned. The Supreme Court will determine whether Spokeo violated the Fair Credit Reporting Act.

According to a US News and World Report story:

"Robins is pursuing a class action against Spokeo on behalf of thousands of other plaintiffs who also say the company published erroneous information about them. If a class is certified, the company could face damages of $1,000 per violation under the Fair Credit Reporting Act, which could add up to billions of dollars."

Many people say they don't like their personal data being collected. They don't like being targeted by advertisers based on that data either. The irony? The same people who might make a habit of calling themselves Chewbacca Jedi when submitting a real email address online also really don't like it when the data stored about them by those omniscient, Orwellian data corporations is incorrect.

Of course, erroneous data affects a lot more than targeted marketing. It also can have a detrimental impact on people's credit scores, insurance rates or ability to get a job. That potential damage led the Federal Trade Commission in its May 2014 report on Data Brokers to call for firms that buy, sell and manage data to create an online hub providing information on what they collect and how it's used. The Commission had little to say about how companies would go about that while protecting the privacy of the people whose data they'd reveal. FTC Chairman Edith Ramirez said simply, "We're not specifying how this central portal ought to be created."

OK, so what's the connection between Spokeo and data giants that offer consumer data for marketing purposes? A lot. They are all reliant on many of the same data -- some publicly available -- showing information on college degrees, marital status, property ownership, bank loans, etc. And it stands to reason that if the court rules in favor of the plaintiff it could have a bearing on all types of data firms, not just people-search companies like Spokeo.

Among the big data brokers, Acxiom has been the most out-front on the issue of transparency and data correction. In September 2013, the firm unveiled its AboutTheData site which allows people to glimpse what the company knows about them; some of the data available through the site such as household income is more granular than other data points that peg someone as a likely pet product buyer.

As one who's peeked at the data that Acxiom reveals several times since that site's launch, I can say some is spot-on, while other seemingly important information such as data about my property ownership is obsolete. I'm not sure I see the value personally in updating that information.

Overall, the case has implications for the data industry as a whole. For one, determining the logistics of ensuring that one updated data source even has the ability to notify all other firms that store the same data in need of an update are daunting.