Vizio Reaches 'Potential Settlement' Of Privacy Class-Action

Smart TV manufacturer Vizio has reached a "potential settlement" of a privacy class action, the company said in court papers filed last week in Santa Ana, Calif.

The agreement is expected to be finalized by August 10, and presented to U.S. District Court Judge Josephone Staton the following month. Tentative terms have not yet been disclosed.

If approved, the deal will resolve a lawsuit alleging that Vizio violated several laws, including a federal video privacy law, by sharing information about consumers with ad-tech companies and data brokers.

The legal battle dates to 2015, when a group of consumers alleged that Vizio tracks TV viewers by default, and shares data with companies that send targeted ads to people's phones, tablets and other devices. The first complaint came several days after ProPublica published a report about the company.



Last year, Staton rejected Vizo's bid to dismiss the lawsuit. The manufacturer had argued that the federal Video Privacy Protection Act -- which prohibits video providers from disclosing personally identifiable information about people's video-viewing history without their explicit consent -- doesn't apply to device manufacturers.

Vizio also argued that the type of data allegedly disclosed -- including IP addresses, media access control (MAC) addresses, ZIP codes, computer names, and product serial numbers -- wasn't personally identifiable.

Staton sided against Vizio on both points. She said in a ruling issued in March 2017 that Congress intended for the video privacy law to apply to companies that are "in the business of delivering video content."

The judge also rejected Vizio's contention that the type of information allegedly disclosed couldn't be personally identifiable. While Staton made clear that the ruling was only preliminary, and could change depending on facts that emerged as the case progressed, she also suggested that even theoretically "anonymous" data could be used to identify individuals.

In the written opinion, 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 unsuccessfully asked Staton to authorize an immediate appeal of her decision.

Last 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 against the company.

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