Google, H&R Block, Meta Schemed to Monetize Private Tax Data, Alleges Class Action

Companies that assist taxpayers in preparing and submitting their taxes through online platforms and software programs are “inherently familiar” with the risk and safeguards required by law to prevent the interception, collection, recordation and/or exploitation of tax return information. Yet defendants Google, H&R Block and Meta entered into an agreement “to explicitly and intentionally violate” the privacy rights, protections, and expectations of taxpayers by illegally collecting, intercepting and transmitting private tax return information (TRI), alleged plaintiff Justin Hunt’s class action Wednesday (docket 3:23-cv-04953) in U.S. District Court for Northern California in San Francisco. They did so “to further the end goal of maximizing profits through direct-to-consumer advertising,” it said.

Through “deceit and wire fraud,” the defendants “obtained economic value” at the expense of Hunt and the class, depriving them of “tangible, economic value, through the conversion and distribution of their TRI,” alleged the class action. It alleges violations of the 1970 Racketeer Influenced and Corrupt Organizations Act, the 1986 Electronic Communications Privacy Act and the California Invasion of Privacy Act.

Californian Hunt filed his taxes using H&R Block’s online tax filing service from 2018 to 2023, said the complaint. He also uses Meta and Google products, it said. As a taxpayer, Hunt had “a reasonable expectation” based on applicable law and the representations made by Google, H&R Block and Meta that his TRI data wouldn’t be “fraudulently intercepted, collected and transmitted from his tax preparer, H&R Block, to Meta and Google,” it said.

Hunt used H&R Block to prepare his taxes “with the expectation that his TRI information would be protected from disclosure from third parties such as Meta and Google,” said his complaint. Had Hunt been aware of the “enterprise and scheme” that the defendants “perpetrated,” he wouldn’t have used H&R Block to prepare his taxes, it said. Hunt “likewise understands that his sensitive TRI information is exceptionally valuable, as it can be used to fuel online advertising by Meta and Google,” it said.

By transmitting Hunt’s TRI to Meta and Google, the defendants deprived Hunt “of actual economic value by converting his otherwise valuable TRI to disclosed TRI,” said the complaint. Hunt “received no benefit from the fraudulent transmission of his TRI information,” it said. Rather, the defendants received “highly valuable data” from Hunt for free “through their fraudulent scheme to intercept, collect and transmit” his TRI data, it said. They used Hunt’s TRI data “for their own financial gain,” and to Hunt’s “detriment,” it said.