An Eviscerated Paradigm of Harm: Additional Observations on Article III Standing

Absent an allegation of data misuse, the mere allegation that the plaintiff’s data was accessed fails to constitute a cognizable injury.

Even prior to the watershed SCOTUS decisions in Clapper and Spokeo, numerous lower-court cases held the same line. For example, Reilly v. Ceridian (3rd Circuit, 2011); Galaria v. Nationwide Mut. Ins. Co., (S.D. Ohio 2014), Polanco v. Omnicell, Inc., (D.N.J. 2013); Tierney v. Advocate Health & Hosps. Corp., (N.D. Ill. 2014).

While plaintiffs employ conclusory statements in an attempt to impress upon the court that they are at the brink of cataclysmic data theft events, courts rarely deny the defendant’s motions to dismiss (MTDs) for lack of standing and failure to state a claim upon which relief may be granted (FRCP 12(b)(1) and (6), respectively.)

But this is going to change. As I explained in my post “Eviscerating the Paradigm of Harm: Quantum Computing and the Remodeling of Article III” quantum computing (even at the 5 qubit level) can be a game changer in proving harm. The key question, however, is when (not “if”) plaintiffs will use this technology to overcome MTDs.

Considering the likely low-payout in the majority of these cases, a rational economic model for the use of quantum computing apps will emerge when their cost models level out with other common legal analytical tools. To that end, an interesting and attractive pricing model could be one where the apps are priced based on the plaintiff’s success-rate, in contrast to the use-rate model currently employed.