Privacy Practices Below the Lowest Common Denominator: The Federal Trade Commission’s Initial Application of Unfair and Deceptive Trade Practices Authority to Protect Consumer Privacy (1997-2000)
Author(s): Chris Jay Hoofnagle
Abstract: In this paper, the author reviews the first six actions taken by the Federal Trade Commission (FTC) to safeguard consumers’ privacy under the agency’s authority to prosecute unfair or deceptive trade practices. Six conclusions can be made from these cases: First, the FTC has chosen to take enforcement actions only in cases with strong merits. Second, the protection of children’s online activities is a priority of the FTC. Third, deception is the principal theory on which the FTC has relied to enforce violations of the FTCA against online businesses. Fourth, it is possible for the FTC to pursue a privacy claim under an unfairness theory. However, the unfairness theory is more likely to be successful when pursuing violations of children’s privacy. Fifth, a strong showing of consumer harm is not required for an action based on unfairness. Merely misrepresenting privacy practices or violating a guarantee of privacy is sufficient to actuate agency action. Under the deception theory, there is no requirement to demonstrate harm. Last, monetary damages have not been assessed in FTC privacy actions against online businesses.
Keywords: privacy, consumer protection, unfair and deceptive trade practices