MoFo News Item

A Milestone for Data Protection Case Law: With the Help of Morrison & Foerster, 1&1 Slashes GDPR Fine

12 Nov 2020

BERLIN – November 12, 2020. With the help of Morrison & Foerster LLP, telecommunications service provider 1&1 was able to slash a fine imposed as part of data protection proceedings. Following a fine notice issued by the Federal Commissioner for Data Protection against 1&1 Telecom GmbH, the Bonn Regional Court ruled on November 11 in favor of 1&1 (case ref. 29 OWi 1/20 LG). Rather than the original fine set at €9.55 million, 1&1 now only has to pay €900,000. With this ruling, the Court challenged the calculation concept applied so far by data protection authorities. Further, this was the first judgment rendered by a German court on a GDPR fine and could represent a milestone for any future fine regime in Germany and Europe.

The proceedings did not concern the general protection of data stored by 1&1, but rather the question of how customers can access their contractual information. The case from 2018 revolved around a request made by telephone for the cellphone number of a former life partner. In the case at hand, the Court adjudicated the breach of data protection to be only of a minor nature and unintentional, and to be an isolated incident, for which a multimillion-Euro fine would be disproportionate. At the same time, the judgment took a large number of mitigating circumstances into account. According to the judgment, no sensitive data was affected and a mass disclosure of data was not to be feared. Further, it was stated that 1&1 cooperated immediately and comprehensively with the Federal Commissioner for Data Protection.

In the proceedings, MoFo argued, among other things, that the calculation method applied by the data protection authorities, which is essentially based on a company’s turnover, was in breach of fundamental rights, and in particular in breach of the principles of equal treatment and proportionality. MoFo said that, due to a calculation based mostly on turnover, even the smallest deviation from the statutory provisions could result in heavy fines, which was unacceptable. The Bonn Regional Court essentially accepted this argument.

1&1 Telecom has received advice from Morrison & Foerster in the field of data protection for some time. The team, led by partner Hanno Timner, provided legal advice to 1&1 through the entire proceedings, as well as during the phase prior to the fine notice being received.

The MoFo team was led by Berlin Litigation/Data Protection partner Hanno Timner and Data Protection senior associate Dr. Philip Radlanski.

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