Pixel Tracking Class-Action Lawsuit Filed Under Federal Racketeering Statute

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Following a congressional report of a data breach involving taxpayer information, a reputable attorney has filed a lawsuit against tax preparing and tech giant companies for their failure to alert consumers about the sale of their data. According to the allegations, such personal data was collected through spy cams or tracking pixels and utilized to build programs that deceived consumers.

The companies were alleged to have worked together to implement tracking pixels on the tax preparing company’s website, which exposed sensitive tax-related information of consumers. The data collected through tracking pixels revealed sensitive tax return information about visitors, such as names, social security numbers, addresses, adjusted gross income, dependents’ information, dates of birth, health savings, education expenses and much more—data that prudent people would ordinarily avoid sharing on the social media platforms of giant tech companies. 

The Federal Trade Commission (FTC) had already warned the tax preparing companies that failure to obtain consumer consent before using their data for advertising would be penalized. The lawsuit in question was filed under the Racketeer Influenced and Corrupt Organizations Act (RICO), a statute which usually applies to organized crime. In addition to RICO violations, counts of violation of Internal Revenue Code, Federal Wiretap Act and California Privacy Act were cited.

The companies have argued that they implemented efforts to filter sensitive data, such as bank accounts, social security numbers and contact information; yet, the investigations have revealed that such filtering mechanisms appear to have been flawed.

While pixel tracking remains a major issue in cybersecurity litigation, the implications of this lawsuit are expected to further the argument for the passage of additional laws surrounding the use of consumer data.