Netflix said last year that it was backing a bill to amend the federal Video Privacy Protection Act, in order to integrate with Facebook.
The federal video privacy law prohibits movie rental companies from disclosing information about their customers without their written consent -- apparently on a movie-by-movie basis. The House recently voted to amend the bill by allowing people to consent online to the disclosure of their movie-rental records on an ongoing basis. But the amendment faced criticism in the Senate, where the measure has stalled.
Now, Netflix is apparently getting ready to make a bigger push for the bill. The company has tapped the law firm Greenberg Traurig to lobby in favor of the amendment, The Hillreports today.
The proposed amendment would allow consumers to consent online to the disclosure of their movie-rental records on an ongoing basis. Netflix says the law is necessary for it to integrate with Facebook. Netflix would like to let Facebook users stream movies from their social networking accounts, while also sharing movie-viewing information with their friends.
The movie rental company's general counsel, David Hyman, testified at a Senate hearing that ambiguities in the VPPA prevent it from offering streams directly through Facebook. “The friction that this ambiguity creates places a drag on social video innovation that is not present in any other medium, including music, books, and even news articles,” he told the panel.
But not all legal experts agree that the amendment is necessary for Netflix to offer videos through Facebook. University of Minnesota law professor Bill McGeveran suggested at the Senate hearing that Netflix could simply give Facebook users a “play and share” button. If users click on that button, the company could then spread information about users' movie selections to their friends, without violating the VPPA.
The bill was passed by Congress in 1988 after a Washington newspaper printed the video rental records of Supreme Court nominee Robert Bork. The law allows consumers to sue for $2,500 in damages per violation.
A separate provision of the law requires movie rental companies to discard users' records as soon as possible. Netflix recently agreed to resolve a class-action lawsuit alleging that it violated that portion of the law by retaining records for up to two years after people canceled their accounts. The company disclosed in a recent SEC filing that it had set aside $9 million to settle that lawsuit, but the details of the agreement haven't yet been filed with the court.