Austrian court refers Max Schrems’s Facebook case to ECJ

Irish Times 14^th September 2016

 Austrian student Max Schrems’ high-profile class action case over Facebook’s privacy rules has been referred to the European Court of Justice by Austria’s highest court.

The court in Luxembourg will now have to decide whether Max Schrems can bring a class action suit on behalf of European or even worldwide users of the social network.

Mr Schrems launched a class action suit against Facebook on behalf of 25,000 other people in 2014, accusing it of having invalid privacy policies and processing customer data illegally.

Facebook argued that the Austrian court did not have jurisdiction over the case, which slowly worked its way up the Austrian legal system before being referred to the EU’s top court. The company argues that Mr Schrems is not a consumer but an activist and so cannot legally represent other consumers.

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Mr Schrems said he hoped the European court would be “consumer friendly” when it decided the jurisdiction question, praising it for having been so in previous cases. “Filing thousands of individual lawsuits before thousands of courts would be an absurd exercise,” he said.

Procedural questions

A spokeswoman for Facebook said: “Mr Schrems’s claims have twice been rejected on the grounds that they cannot proceed as ‘class action’ on behalf of other consumers in Austrian courts. We look forward to addressing the procedural questions presented to the [European Court of Justice] to resolve these claims.”

The referral is the latest twist in a five-year dispute between Facebook and Mr Schrems, which began when he was a student and has already upturned data protection law in the EU. Mr Schrems founded the organisation Europe v Facebook, which he is funding from small donations from “many concerned citizens” across Europe.

In a landmark judgment last year, the European Court of Justice struck down a crucial data transfer deal that allowed the likes of Facebook and Amazon to transfer personal data easily from the EU to the US, following a complaint from Mr Schrems.

The court ruled that the deal was invalid because the data of EU citizens were not sufficiently protected from US spies. Edward Snowden, the US National Security Agency whistleblower, praised Mr Schrems at the time, saying he had changed the world for the better.

A separate legal method of transferring data across the Atlantic – known as model contract clauses – is also under question in a related case in Ireland, again involving Mr Schrems. These clauses are relied on by 80 per cent of companies that transfer data from the EU to the US, lawyers estimate.