Expect New Commissioners to Open FTC Privacy Debate, ex-Official Says
Expect incoming FTC members to open debate on what constitutes harm to consumer privacy, an issue in the background with only two sitting commissioners, former FTC Consumer Protection Bureau Director David Vladeck said Friday. It’s likely that President Donald Trump’s FTC nominations (see 1803270046) will be confirmed in the next month or so, George Mason University law professor James Cooper said alongside Vladeck at a GMU event. Because the commission has been deadlocked with only two seated commissioners, acting Chairman Maureen Ohlhausen, a Republican, and Democrat Terrell McSweeny, the administration’s policy changes haven’t been realized, Cooper said.
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Questions over privacy are sure to come up, Vladeck said. He noted infidelity website Ashley Madison set the tone by going out of its way to advertise privacy protection expectations for users. The site's owner settled with the FTC and attorneys general of 13 states and Washington, D.C., over a data breach case in 2016 (see 1612140068). Questions have been “simmering” with the 1-1 commission, Vladeck said.
The debate could have implications for Facebook, which the FTC is currently investigating in a nonpublic probe over the Cambridge Analytica scandal (see 1804060056). Vladeck insisted that the social network violated the agency’s 2011 consent decree, which required the platform to actively monitor third-party handling of private data.
Lydia Parnes, Consumer Protection Bureau director 2004-09, noted Facebook denied it violated the consent decree and said the political overlay surrounding the case will make FTC determinations even more difficult. Given that the data allegedly was used to influence election outcomes, it’s far different from the FTC pursuing action against unfair or deceptive practices involving tangible product sales, Vladeck said. There are disturbing aspects of the Facebook case that may not necessarily constitute violations against any FTC orders or Section 5 requirements, Parnes added.
Companies typically comply with FTC consent decrees, Vladeck said. One outlier relates to Google’s 2012 settlement over allegations that it misrepresented privacy assurances to users of Apple's Safari internet browser (see 1208100031), Vladeck said. If there is a Facebook violation, Vladeck said the key question is: What message does the agency want to send about consent decree violations? The FTC’s approach will have implications for deterring future harmful behaviors, he added.
Expect agency leadership to be briefed on the Facebook investigation often, Parnes said, suggesting that the chairman and commissioners will want to stay up to date on the facts the agency is gathering. The agency should determine by late 2018 or early 19 whether Facebook violated U.S. law, Vladeck said. The company didn’t comment.