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In re Sonic Corp. Customer Data Security Breach Litigation

United States District Court, D. Nevada

December 6, 2017

IN RE SONIC CORP. CUSTOMER DATA SECURITY BREACH LITIGATION

          TRANSFER ORDER

          Sarah S. Vance Chair

         Before the Panel: [*]

         Plaintiffs in two Western District of Oklahoma actions, listed on Schedule A, move under 28 U.S.C. § 1407 to centralize this litigation in the Western District of Oklahoma.[1] This litigation consists of five actions pending in three districts, as listed on Schedule A.[2] Plaintiffs in the remaining Western District of Oklahoma action and the District of Oregon action support the motion or, alternatively, support centralization in the Northern District of Ohio. Plaintiffs in the District of Nevada action and the Northern District of Ohio potential tag-along action support centralization in the Northern District of Ohio. Defendant Sonic Corp. opposes centralization or, alternatively, supports centralization in the Western District of Oklahoma.

         On the basis of the papers filed and the hearing session held, we find that centralization under Section 1407 in the Northern District of Ohio will serve the convenience of the parties and witnesses and promote the just and efficient conduct of this litigation. These actions-all of which are putative nationwide class actions-share factual issues concerning an incident in which Sonic's point-of-sale system was breached, allowing computer hackers to gain access to up to 5 million individuals' personally identifiable information. Centralization will eliminate duplicative discovery; prevent inconsistent pretrial rulings on class certification and other issues; and conserve the resources of the parties, their counsel, and the judiciary.

         In opposing centralization, defendant argues, inter alia, that (1) informal cooperation is preferable to Section 1407 centralization, (2) unique facts and circumstances predominate over common questions of fact, and (3) the common factual issues are not sufficiently complex to warrant centralization, particularly as the litigation involves only one defendant. Section 1407 “does not require a complete identity of common factual issues or parties as a prerequisite to transfer, and the presence of . . differing legal theories is not significant where, as here, the actions still arise from a common factual core.” In re: Auto Body Shop Antitrust Litig., 37 F.Supp.3d 1388, 1390 (J.P.M.L. 2014). The factual overlap among these actions is substantial, as they all arise from the same data breach, and all allege that Sonic failed to put in place reasonable data protections. All actions allege similar claims, including for negligence. The Panel previously has centralized a similar number of data breach actions, even those involving a lone defendant. See In re: Sprouts Farmers Market, Inc., Employee Data Sec. Breach Litig., 232 F.Supp.3d 1348 (J.P.M.L. 2016).

         We are persuaded that the Northern District of Ohio-a centrally-located and easily accessible location-is an appropriate transferee forum for this litigation. All responding plaintiffs support this district, in the first instance or in the alternative. The Northern District of Ohio potential tag-along action is assigned to Judge James S. Gwin, an experienced transferee judge who we are confident will steer these cases on a prudent course.

         IT IS THEREFORE ORDERED that the actions listed on Schedule A are transferred to the Northern District of Ohio, and, with the consent of that court, assigned to the Honorable James S. Gwin for coordinated or consolidated pretrial proceedings.

          Marjorie O. Rendell R. David Proctor.

          Charles R. Breyer Catherine D. Perry.

         SCHEDULE A

         District of Nevada

         DOLEMBO v. SONIC CORP., C.A. No. 2:17-02524

         Western District of Oklahoma

         HUFFER, ET AL. v. SONIC CORP., C.A. No. 5:17-01032 RAMIREZ v. SONIC CORP., C.A. No. 5:17-01044 LEWIN, ET AL. ...


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