Consumer Issues, Privacy & Data Security – Page 6

No Group Hugs: The Supreme Court Says “Yes” to Class Action Arbitration Waivers

Apr 29 2011

The Supreme Court’s ruling in AT&T Mobility LLC v. Concepcion continues the Court’s string of arbitration decisions bringing greater clarity to what has been a cloudy subject. In this decision, the Court addresses the question of whether businesses can enforce class action waivers in their consumer arbitration agreements, answering unequivocally “yes.” Indeed, the decision is an important victory for businesses, and is likely to help businesses avoid the costs of what are more often than not meritless class lawsuits.

The Concepcion decision finds its roots in the Court’s recent decision in Stolt-Nielsen S.A. v. AnimalFeeds International Corporation. There, the Court established the principle that parties cannot be forced to submit to class-wide arbitration unless they have actually agreed to do so. In Stolt-Nielsen the Court did not have the occasion to address whether parties can expressly waive arbitration on a class-wide basis. Now, applying Stolt-Nielsen to express class action arbitration waivers, Concepcion finds the Federal Arbitration Act (FAA) invalidates state law aimed at barring such waivers. State law is preempted by the FAA where it presents “an obstacle” to accomplishing Congress’s objective of promoting the efficiency of arbitration.

The telecommunications, consumer credit and finance, and sales industries, as well as other businesses that offer consumer services, are likely to benefit from the lower costs of individual arbitration. AT&T contends that consumers will also benefit from the streamlined procedures offered by arbitration.

Senators McCain and Kerry Introduce Privacy Bill of Rights

Apr 13 2011

On April 12, 2011, Senator John Kerry (D-MA) and Senator John McCain (R-AZ) introduced the “Commercial Privacy Bill of Rights Act of 2011” to establish the first federal statutory baseline of consumer privacy protection that would apply across industry sectors. The bill would govern how customer information is used, stored, and distributed online. We will provide more analysis soon, but for now, here are the highlights:

Information covered. The bill applies to broad categories of information, including names, addresses, phone numbers, e-mail addresses, other unique identifiers, and biometric data when any of those categories are combined with a date of birth, place of birth, birth certificate number, location data, unique identifier information (that does not, alone, identify an individual), information about an individual’s use of voice services, or any other information that could be used to identify the individual.

Right to security and accountability. Information-collecting entities would be required to implement security measures to protect user information and would be prohibited from collecting more individual information than is necessary “to enforce a transaction or deliver a service requested by that individual,” subject to certain exceptions.

Privacy by design. Entities would be required to implement privacy by design concepts, which would require entities to incorporate privacy protection into each stage of product or service development in a manner that is much more comprehensive than previously required anywhere in the United States.

U.S. Justice Department Raises Concerns Regarding Proposal to Limit Federal Government’s Access to ‘Cloud’ Data

Apr 12 2011

By Oded Green

On April 6, 2011, the Senate Judiciary Committee held a hearing regarding a proposed update to the Electronic Communications Privacy Act (ECPA) in light of cloud computing and other technological developments that have occurred since the statute was enacted more than two decades ago. The ECPA is comprised of three laws — the Wiretap Act, the Stored Communications Act, and the Pen Register Act — which govern when certain parties, including law enforcement and other governmental authorities, may access communications and related data and to whom they may disclose those communications and data.

According to Senate Judiciary Committee Chairman, Patrick Leahy, with the explosion of cloud computing, social networking sites and other new technologies, determining how to bring ECPA into the digital age is one of Congress’ greatest challenges. He added that ECPA is “hampered by conflicting standards that cause confusion for law enforcement, businesses and consumers.” For example, the content of a single e-mail could be subject to as many as four different levels of privacy protections under ECPA, depending on where it is stored, and when it is sent.

Retransmission Consent Examined in Heated, Live Webcast Debate Among Broadcast, Cable, Programming, and Consumer Interests

Apr 11 2011

A live webcast last week carried on Internet TV channel Broadband US TV examined all sides of the debate on whether rules governing the grant of retransmission consent by local broadcast stations to cable operators, DBS providers, and other multichannel video programming distributors (MVPDs), should be reformed.

Retransmission consent negotiations have become quite contentious in recent years, at times resulting in the temporary blackout of a local broadcast station in the face of an impasse between the MVPD and broadcaster.

The lively and, at times, raucous debate featured Toni Cook Bush of Skadden, Arps and John Hane of Pillsbury Winthrop Shaw Pittman for broadcasters, Ross Lieberman of the American Cable Association and Cristina Pauze of Time Warner Cable for cable operators, Gigi Sohn of Public Knowledge for consumer interests, and Richard Waysdorf, of Starz Entertainment for independent programmers. The program was moderated by Broadband US TV co-hosts Marty Stern of K&L Gates and Jim Baller of the Baller Herbst Law Group.

House Votes to Overturn FCC’s Net Neutrality Order

Apr 08 2011

In a setback to one of the FCC’s key policy proposals, the House of Representative today voted in favor of a Resolution of Disapproval under the Congressional Review Act aimed at invalidating the Commission’s Net Neutrality Order adopted late last year. The vote follows months of heated industry and Congressional debate, including sharply partisan debate about the Resolution’s merits, court challenges brought by wireless carriers, and procedural delays in bringing the Resolution to the House floor. While the Resolution seeks to overturn the FCC’s new anti-blocking, network management transparency, and traffic discrimination rules, it faces an uphill battle to become law. The Resolution would need to get passed by the Democrat-controlled Senate and get signed by the President. The White House recently said it plans to veto any measure overturning the FCC’s Net Neutrality Order.

FTC Continues to Flex Its Enforcement Muscle With Regard to Social Media Promotional Activity

Apr 07 2011

by Ann M. Begley, Lawrence C. Lanpher and Carolina M. Heavner

The Federal Trade Commission’s (“FTC”) recent action against a company and its owner in connection with the allegedly deceptive promotion of music teaching tools signals FTC’s continued intention to keep social media promotional activity as an enforcement priority. In its third public investigation and second enforcement action since issuing its revised Guides Concerning the Use of Endorsements and Testimonials in Advertising[1] (hereafter, FTC Endorsement/Testimonial Guides) in December 2009, FTC continues to expand advertisers’ responsibility to monitor third party interactive media communications containing endorsements of advertisers’ products.

In finding the advertiser and its owner, an individual, responsible for assuring that endorsers adequately disclose any material connections with the advertiser, FTC states that an advertiser agreement that requires endorsers to comply with FTC guidelines and disclosures is insufficient in the absence of an advertiser monitoring program that ensures clear and prominent disclosure of the relationship with the advertiser.[2]

Thus, in addition to a $250,000 penalty against the company and its owner, FTC has required a far-reaching monitoring program – a potentially expensive and burdensome commitment for the future.

Court Dismisses Appeal Against FCC’s Net Neutrality Rules

Apr 04 2011

Today the FCC prevailed in the continuing skirmish over Net Neutrality in Washington. The U.S. Court of Appeals for the District of Columbia dismissed the lawsuits filed last January by Verizon and Metro PCS seeking to overturn the FCC’s Net Neutrality order adopted in December. The court found that the two wireless carriers filed their challenges too early and should have waited until the Net Neutrality order was published in the Federal Register. Both wireless carriers have indicated they will re-file their appeals.

Doing Business in Mexico? It’s Time to Revise Your Privacy Practices

Mar 22 2011

By Holly K. Towle, Henry L. Judy, Samuel R. Castic

On July 6, 2010, Mexico’s “Law on the Protection of Personal Data Held by Private Parties” took effect, and some of the most stringent requirements are currently scheduled to take effect in July 2011. Accordingly, the time for companies that are covered by the law to adjust their privacy policies and business practices is today, not mañana.[1] In many ways, this law is more robust than approaches taken to data protection in the United States. It brings Mexican privacy law far closer to, or goes beyond, the concepts and structure of the European Data Protection Directive (“EU Directive”)[2] or other approaches such as the Canadian Personal Information Protection and Electronic Documents Act.[3] The law also seems to approximate the European Union approach of treating data protection as a basic right.[4] This Alert discusses some of the key provisions of Mexico’s new law.

High Court to AT&T: Don’t Take It Personally, But You Have No “Personal Privacy”

Mar 04 2011

By Bruce Nielson.

The U.S. Supreme Court recently held that AT&T and other corporations do not have “personal privacy” for purposes of an exemption from the information disclosure requirements of the Freedom of Information Act (“FOIA”). In its unanimous opinion in FCC v. AT&T Inc., the court rejected “the argument that because ‘person’ is defined for purposes of FOIA to include a corporation, the phrase ‘personal privacy’ in [FOIA] Exemption 7(C) reaches corporations.” The court held: “The protection in FOIA against disclosure of law enforcement information on the ground that it would constitute an unwarranted invasion of personal privacy does not extend to corporations.”

The AT&T case arose in connection with an FCC investigation into whether AT&T overcharged the government for services rendered in connection with an FCC-administered program designed to enhance access to information and telecommunications services by schools and libraries. During the investigation, AT&T provided documents to the FCC that included information about employees involved in the program and invoices and emails with pricing and billing information. The FCC and AT&T resolved the matter in 2004.

States Support Additional Federal Consumer Information Privacy Protections

Feb 28 2011

By Bruce Nielson and Samuel Castic

Fifteen state attorneys general recently sent a letter to the FTC supporting its recent proposal for a federal regulatory framework to protect the privacy and security of consumer information. The letter also recommends additional consumer information privacy and security protections that go beyond the FTC’s proposal. The FTC’s proposal, in the form of a preliminary FTC Staff Report entitled “Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers” (the “Report”) was released on December 1, 2010 and is described in more detail in a prior blog entry.

The 15 state attorneys general – from Arizona, Illinois, Indiana, Iowa, Massachusetts, Montana, Nevada, New Mexico, New York, North Dakota, Rhode Island, Tennessee, Vermont, Virginia and Washington (the “States”) – make the following points in their February 18, 2011 letter to the FTC:

Catagory:Consumer Issues, Privacy & Data Security