Academic journal article Harvard Law Review

Federal Statutes - Stored Communications Act - Fourth Circuit Upholds Award of Punitive but Not Statutory Damages

Academic journal article Harvard Law Review

Federal Statutes - Stored Communications Act - Fourth Circuit Upholds Award of Punitive but Not Statutory Damages

Article excerpt

FEDERAL STATUTES--STORED COMMUNICATIONS ACT--FOURTH CIRCUIT UPHOLDS AWARD OF PUNITIVE BUT NOT STATUTORY DAMAGES.--Van Alstyne v. Electronic Scriptorium, Ltd., 560 F.3d 199 (4th Cir. 2009).

The rapid rise of electronic communication over the past several decades has created myriad concerns regarding personal privacy. (1) In 1986, Congress passed the Stored Communications Act (2) (SCA) in response to escalating interference with such communication. (3) Enacted as part of the broader Electronic Communications Privacy Act (4) (ECPA), the SCA allows courts to award plaintiffs both statutory and punitive damages for invasion of electronic privacy. (5) Recently, in Van Alstyne v. Electronic Scriptorium, Ltd., (6) the Fourth Circuit held that, absent a demonstration of actual damages, the SCA allows an award of punitive damages and attorney's fees but not statutory damages. (7) In reaching its decision on the statutory damages question, the Fourth Circuit relied heavily on the Supreme Court's opinion in Doe v. Chao, (8) which interpreted the Privacy Act of 1974 (9) to provide statutory damages only in the presence of actual damages. (10) By approving the punitive damages award in Van Alstyne without requiring proof of actual damages, the Fourth Circuit sharpened the teeth of the SCA. However, in considering the question of statutory damages, the court overstated the similarities between the Privacy Act and the SCA, ignoring relevant differences in the acts' texts and legislative histories that indicate that Congress intended the SCA to provide broader relief than the Privacy Act provides. In order to fulfill the SCA's purpose of protecting individual privacy in the realm of electronic communication, (11) the Fourth Circuit should have affirmed the district court's grant of statutory damages.

Bonnie Van Alstyne worked for the data conversion company Electronic Scriptorium, Ltd. (ESL). (12) In October 2001, the firm's president allegedly sexually propositioned her, and she refused his advances. (13) Five months after this incident allegedly occurred, ESL terminated Van Alstyne. (14) The two parties brought various claims against one another, ESL for business torts and Van Alstyne for sexual harassment. (15) During the discovery phase of ESL's tort suit, the company produced several emails from Van Alstyne's personal account. (16) After discovering that her former employer had accessed her account without authorization, Van Alstyne brought an action against ESL under the SCA. (17)

In the United States District Court for the Eastern District of Virginia, a jury found that ESL's unauthorized access of Van Alstyne's personal email indeed constituted a violation of the SCA. (18) The jury awarded Van Alstyne $150,000 in statutory damages and $75,000 in punitive damages against ESL's president, and $25,000 in statutory damages and $25,000 in punitive damages against the firm itself. (19) The district court approved the statutory damages awards despite the fact that Van Alstyne had not alleged that she had suffered actual damages as a result of her employer's invasion of her privacy. (20)

The Fourth Circuit vacated in relevant part and remanded. (21) Writing for a unanimous panel, Chief Judge Williams based her analysis of the SCA's damages provision on the Supreme Court's interpretation in Doe v. Chao of a similarly worded clause in the 1974 Privacy Act. (22) Under the Privacy Act, when agency mismanagement or improper disclosure of an individual's administrative record has an adverse effect on the individual (23) and a court finds the agency's action to have been "intentional or willful, the United States shall be liable to the individual in an amount equal to ... actual damages sustained by the individual as a result of the refusal or failure, but in no case shall a person entitled to recovery receive less than the sum of $1,000." (24) Under the SCA, "[t]he court may assess as damages ... the sum of the actual damages suffered by the plaintiff and any profits made by the violator as a result of the violation, but in no case shall a person entitled to recover receive less than the sum of $1,000. …

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