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Tuesday, Mar 31, 2015

Netflix in the middle of Internet privacy debate


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By now just about everybody knows that Netflix has become the world’s leading Internet and rental subscription service for movies and television programs.

What most people don’t know, however, is that Netflix also has become an industry leader in the computer storage and use of its subscribers’ private content-viewing histories and other personal information.

Based in a suburb of San Jose, California, Netflix has more than 27 million online subscribers in the U.S. An estimated 3 million to 4 million Netflix users live in Florida.

In six recent nationwide class-action lawsuits, filed in the federal district court in San Jose, former Netflix subscribers have alleged that the company had illegally stored “a veritable digital dossier” of the personal information of millions of users for more than two years. They claimed that the practice violated the federal Video Privacy Protection Act of 1988 (“VPPA”) and California state privacy laws.

The somewhat outdated VPPA requires “video tape service providers” to destroy users' personally identifiable information no later than one year after the information is no longer necessary.

Congress enacted VPPA after President Reagan’s unsuccessful nominee to the U.S. Supreme Court in 1987, the late Robert H. Bork, had his private video rental history published by a weekly newspaper.

The privacy lawsuits against Netflix, which began in January of 2011, were finally settled last month, without a trial. They have provided further insight into the troubling question of what reasonable expectations of privacy Internet users should have under federal and state laws.

As an attorney for two of the plaintiffs who sued Netflix, Jay Edelson of Chicago, put it, “Netflix’s practices are indicative of a larger problem, the development and maintenance of digital dossiers on consumers by online companies.”

Edelson said his clients first learned of Netflix’s retention practices when, years after they had closed their Netflix accounts, they continued to receive occasional e-mails from Netflix encouraging them to re-join.

While denying that it had violated any laws, Netflix agreed to pay $9 million to settle the litigation, with none of the money going to its current or former subscribers.

As approved by U.S. District Judge Edward J. Davila on March 18, the settlement pays the lawyers who brought the lawsuits more than $2.2 million in legal fees and costs and the six individuals who acted as named plaintiffs will split an “incentive award” of $30,000.

The rest of the money will go to 20 not-for-profit organizations for the purpose of educating users, regulators, and enterprises on issues such as protection of privacy, identity and personal information.

Netflix also agreed to separate in its databases its former subscribers’ viewing histories from their personal identification information.

It seems that the deeper we go into the Internet age, the more difficult it is to retain any personal privacy online. However, as of today, I have watched only 11 of the first 13 episodes of “House of Cards,” the riveting Netflix original drama series about Washington politics starring Kevin Spacey.

I won’t even think of canceling my Netflix subscription until I watch the last two episodes.

Angel Castillo, Jr., a former reporter and editor for the New York Times and The Miami Herald, practices employment law in Miami. He can be reached at

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