The move comes several months after Amazon and seven state residents convinced a federal judge in Seattle that North Carolina's request violated residents' free speech rights to purchase books and movies anonymously.
The dispute started last year, when North Carolina's Department of Revenue attempted to police state tax laws by requesting records of all Amazon purchases made since 2003. Amazon responded by seeking an order from a federal court in Seattle (where it's based) declaring North Carolina's request unconstitutional. Seven North Carolina residents (represented by the ACLU) intervened in the case. They argued that the government's request violates their privacy and their First Amendment rights to read anonymously.
Last October, a federal judge issued a ruling that sweepingly vindicated online purchasers' First Amendment rights. "The [Department of Revenue] concedes that it has no legitimate need or use for having details as to North Carolina Amazon customers' literary, music, and film purchases," the judge wrote. "With no compelling need for both sets of information, the DOR's request runs afoul of the First Amendment."
The settlement, which was quietly entered late last month, is even broader than the judge's decision because the settlement affects Web users who have made purchases at all e-commerce companies, not only Amazon.
The ACLU rightly calls the settlement "a great win for privacy."
"Requesting information about what people are purchasing online causes real harm, to real people, and it is unconstitutional in these circumstances," the civil liberties organization writes.