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Privacy lawsuits rain down on Netflix

No fewer than five suits accusing Netflix of violating privacy laws were filed in the past two months. All the suits say Netflix stores and maintains customers' personal information after service is canceled.


Netflix, the Web's top video-rental service, has been accused of violating U.S. privacy laws in five separate lawsuits filed during the past two months, records show.

Each of the five plaintiffs allege that Netflix hangs onto customer information, such as credit card numbers and rental histories, long after subscribers cancel their membership. They claim this violates the Video Privacy Protection Act (VPPA).

A Netflix spokesman declined to comment.

In a four-page suit filed Friday, Michael Sevy, a former Netflix subscriber who lives in Michigan, accuses Netflix of violating the VPPA by "collecting, storing and maintaining for an indefinite period of time, the video rental histories of every customer that has ever rented a DVD from Netflix." Netflix also retains information that "identifies the customer as having requested or obtained specific video materials or services," according to Sevy's suit.

In a complaint filed February 22, plaintiff Jason Bernal, a resident of Texas, claimed "Netflix has assumed the role of Big Brother and trampled the privacy rights of its former customers."

Jeff Milans from Virginia filed the first of the five suits on Jan. 26. One of his attorneys, Bill Gray, told CNET today that the way he knows Netflix is preserving information belonging to customers who have left the company is from Netflix e-mails. According to Gray, in messages to former subscribers, Netflix writes something similar to 'We'd love to have you come back. We've retained all of your video choices.'"

Gray said that Netflix uses the customer data to market the rental service, but this is done while risking its customers' privacy. Someone's choice in rental movies could prove embarrassing, according to Gray, and should hackers ever get access to Netflix's database, that information could be made publicly available.

"We want Netflix to operate in compliance of the law and delete all of this information," Gray said.

All the plaintiffs filed their complaints in U.S. District Court for the Northern District of California. Each has asked the court for class action status.

This number of lawsuits, with almost identical claims and with close filing dates, is peculiar. Gray said his client filed first and he said it's not uncommon in these kinds of cases to see "copycat complaints" filed.

The VPPA, passed by Congress in 1988, was created to prevent the "wrongful disclosure of videotape rental or sale records." The law was a response to the release of the video-renting history of Robert Bork, the legal scholar and appeals court judge, during his Supreme Court nomination. There was little remarkable about Bork's but the fact that reporters were able to obtain information that spooked lawmakers.

Netflix, based in Los Gatos, Calif., has run up against VPPA issues before.

In December 2009, reported that a woman, who was gay but hadn't revealed that publicly, sued Netflix for potentially outing her sexual orientation when the company handed over "insufficiently anonymous" information belonging to half a million customers. The company handed the information out as part of an attempt to improve its recommendation system.

Netflix managers offered $1 million to anyone who could come up with a better film-recommendation algorithm. The company would then turn over to contestants the kinds of movies subscribers chose and the ratings they gave but without identifying the customers. The plaintiff in that case argued that people's identities could be dug up out of the raw data.

The lawsuit was settled and Netflix agreed last year to discontinue the contest.

Update 10:42 a.m. PT: To include comments from one of the plaintiffs' lawyers.