The Video Privacy Protection Act became law decades ago, at a time when consumers physically visited and then rented movies on VHS tape or DVD at video rental stores. The impetus for the law was protecting the privacy of customers’ video rental choices after the publication of a list of films that then-Supreme Court nominee Robert Bork had rented from a video store.
In recent years, the VPPA has been increasingly used by the plaintiffs’ bar to bring class action suits against a range of businesses and website operators. The lawsuits typically allege that modern online website operations and marketing tools are used in violation of the VPPA. The explosion of video content provided on websites has attracted claims that businesses improperly share consumers’ personal information, often obtained through website tracking and data collection tools, with third parties such as data analytics vendors, in violation of the VPPA.
The litigation stems from the fact that the VPPA allows a “consumer” to bring suit against a “video tape service provider” who knowingly discloses personally identifiable information. Thus, one of the key battleground issues in VPPA litigation is who qualifies as a “consumer” under the statute.
Some federal courts have ruled that an individual is a “consumer” if he or she uses any of the goods or services of the video service provider. However, other courts have ruled that an individual is not a “consumer” unless the goods or services used were audiovisual in nature.
The U.S. Supreme Court is set to resolve this split in the courts.
Salazar v. Paramount Global
In September 2022, Michael Salazar filed a class action complaint against Paramount Global, doing business as 247Sports, in a federal court in Tennessee. Mr. Salazar alleged that Paramount used pixel technology to track and disclose users’ identities and video-viewing data when they visited 247Sports.com, a Paramount-owned website. This activity allegedly violated the VPPA due to unlawful disclosures. Mr. Salazar argued that he qualified as a “consumer” because he subscribed to the website’s online newsletter. Paramount moved to dismiss the lawsuit on the ground that Mr. Salazar was not a “consumer” for VPPA purposes.
The federal court in Tennessee took the restrictive view, found that Mr. Salazar was not a “consumer,” and dismissed the lawsuit. Mr. Salazar appealed, and the U.S. Court of Appeals for the Sixth Circuit affirmed the lower court decision.
According to the Sixth Circuit, merely subscribing to the 247Sports newsletter was not enough to make Mr. Salazar a “consumer” under the VPPA because the newsletter was not an audiovisual good or service.
Mr. Salazar petitioned for review by the U.S. Supreme Court, and the Court has granted Salazar’s petition. (Scroll to page 2 of the linked document.) The Court is expected to resolve a split among federal circuits as to the meaning of “consumer” under the VPPA.
Clarity would be welcome
Businesses are currently subject to conflicting interpretations of the VPPA, which makes it difficult for them to assess their legal compliance status and their litigation risks related to website activity, digital content, and other digital and online interactions with website visitors and customers.
The coming Supreme Court opinion should provide clarity on data handling requirements for common business activities that occur online in the modern era. For example, what does the VPPA require when a business collects data related to digital videos available on a website? Who is a “consumer” with the right to sue a business for alleged violations?
The Court’s decision will also affect companies’ litigation strategies for defending VPPA suits. If the Court adopts the Sixth Circuit position, that should make it easier for businesses to win early dismissals of VPPA lawsuits. But if the Court adopts the broader definition, businesses may be encouraged to take a harder look at potential early mediation and settlement.
PartnerHe regularly defends clients in a variety of complex and high-stakes privacy and cyber-related litigation, including class action data breach suits, wire fraud litigation, and employee data theft actions. John’s experience ...
Associate AttorneyTaylor brings over four years of civil litigation experience to assist our clients. Prior to joining Constangy, she represented clients in insurance defense and complex commercial litigation matters in a variety of areas ...
The Constangy Cyber Advisor posts regular updates on legislative developments, data privacy, and information security trends. Our blog posts are informed through the Constangy Cyber Team's experience managing thousands of data breaches, providing robust compliance advisory services, and consultation on complex data privacy and security litigation.
