Vizio Seeks To Take Video Privacy Battle To Appellate Court

Smart TV manufacturer Vizio is seeking to immediately appeal a judge's decision allowing consumers to proceed with allegations that it violated a federal video privacy law by sharing information about viewers with ad-tech companies and data brokers.

The ruling "has sweeping policy implications for numerous industries that should be addressed as soon as possible to resolve any uncertainty such industries presently face," Vizio says in a petition asking U.S. District Court Judge Josephine Staton in Santa Ana, California to authorize an immediate appeal to the 9th Circuit Court of Appeals.

The battle centers on allegations that Vizio tracks TV viewers by default, and then shares data with companies that send targeted ads to people's phones, tablets and other devices. A group of consumers says in a class-action complaint that Vizio's alleged data transfers violated the Video Privacy Protection Act -- a 1988 law that prohibits video providers from disclosing personally identifiable information about people's video-viewing history.

"Vizio may be one of the first Smart TV manufacturers to be sued under the VPPA," the company writes in its legal papers, filed late last week. "But given the court’s expansion of both the types of data and companies potentially subject to the VPPA, multiple industries may suddenly be subject to the Act’s reach."

Vizio unsuccessfully asked Staton to dismiss the case at a preliminary stage, arguing that the video privacy law doesn't apply to device manufacturers like itself. The company also contended that the lawsuit should be dismissed immediately because the type of information allegedly disclosed -- including IP addresses, media access control (MAC) addresses, ZIP codes, computer names, and product serial numbers -- wasn't personally identifiable.

Staton rejected both arguments. She said in a ruling issued in March that Congress intended for the video privacy law to apply to companies that are "in the business of delivering video content."

She also suggested that even supposedly "anonymous" data could be used to identify individuals. In her ruling, she pointed to allegations in the complaint that MAC addresses can be used to learn specific geolocation data, and to identify individuals when combined with data about IP addresses, ZIP codes, serial numbers, and other data.

Vizio now says that the 9th Circuit should decide whether the consumers can proceed.

"If this Court’s reasoning is adopted, the VPPA could now apply to the makers of personal computers, smart phones, tablets, video game consoles, and virtually any contemporary device made with a screen and accompanying software," Vizio argues.

The manufacturer argues to Staton that it's "highly likely that reasonable judges could disagree" with her about whether disclosing information about devices potentially violates the video privacy law.

Questions about the definition of personally identifiable information haven't yet been definitively decided by the courts. The 1st Circuit Court of Appeals ruled last year that Gannett potentially violated the law by allegedly transmitting users' device identifiers, GPS data and video viewing history to Adobe. But other judges have dismissed complaints against video distributors that allegedly transmitted "anonymous" information to outside companies. For instance, a judge in Seattle dismissed a lawsuit by Roku user Chad Eichenberger, who accused ESPN of transmitting his Roku's serial number, combined with data about videos watched, to Adobe. (That matter is now pending at the 9th Circuit.)

Earlier this year, the Federal Trade Commission brought a separate enforcement action against Vizio for allegedly engaging in an unfair practice by tracking consumers, and for deceiving consumers by failing to adequately explain its data practices. The company agreed to settle the charges by paying $2.2 million to the FTC and the state of New Jersey, which also brought a complaint about the company.

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