Netflix scored a victory in the House today, when the Judiciary Committee approved a measure that would help the company integrate with Facebook.
The bill, H.R. 2471, sponsored by Rep. Robert Goodlatte (R-Va.), would amend a 23-year-old privacy law aimed at preserving the confidentiality of people's movie-watching records. The Video Privacy Protection Act prohibits movie rental companies from disclosing information about their customers without their consent. Goodlatte's amendment explicitly allows people to consent online to the disclosure of their movie-rental records on an ongoing basis.
Congress passed the VPPA after a Washington newspaper obtained the video rental records of Robert Bork, who was nominated to serve on the U.S. Supreme Court. The statute has real teeth: it allows consumers to sue for up to $2,500 in damages per violation.
Still, whether the video privacy protection law would really prohibit a Netflix-Facebook integration if users opted in isn't completely clear. Michael Drobac, director of government relations at the company, said recently that the law "creates some confusion" about the ability to "to let U.S. members automatically share the television shows and movies they watch with their friends on Facebook."
But Netflix's concerns are understandable, given that both Facebook and Netflix have been sued for allegedly violating the VPPA. Netflix also faces class-action litigation for retaining data about users' movie rental history and recommendations. The case against Facebook stemmed from the 2007 Beacon program, which told users about their friends' activity on outside sites, including Blockbuster.com. Facebook agreed to resolve that case by contributing $6 million toward a new privacy foundation (that it will partially control). Facebook hasn't yet launched the foundation because an appellate court is still reviewing the settlement.