A 1988 law continues to be the “buffering” in Netflix’s success stream. The Video Privacy Protection Act, which forbids movie rental companies from sharing customers’ rental history, is not only stopping Netflix from integrating movie-streaming with Facebook in the U.S., but has cost the company $9 million to settle a class-action lawsuit.
The AP reports a pair of Virginians accused Netflix of violating the law by keeping lists of movies former customers rented as long as two years after they canceled. According to the suit, Netflix should have removed identifying information from the logs sooner.
Netflix, which is putting pressure on lawmakers to change the law, paid out $9 million to settle the complaint while admitting no wrongdoing.
If nothing else, this settlement proves that the 1988 law has enough teeth to stand up to some degree in court. Unless the law changes, the U.S. probably won’t join the list of more than 47 countries in which a Netflix app is on Facebook.
Netflix Class Action Settlement: Service Pays $9 Million After Allegations Of Privacy Violations [AP via Huffington Post]