Cobun Zweifel-Keegan, J.D., CIPP/US, CIPM

For those entrenched in the data privacy profession, it is refreshing to read work that tackles familiar questions, such as those surrounding the value of personal data, through a less familiar lens. The practice of privacy is flourishing because of the many novel challenges sparked by the proliferation of personal data. Questions abound about how best to manage access to personal information, how to control its spread, and how to signal its quality and sensitivity. With such goals in mind… Show more

For those entrenched in the data privacy profession, it is refreshing to read work that tackles familiar questions, such as those surrounding the value of personal data, through a less familiar lens. The practice of privacy is flourishing because of the many novel challenges sparked by the proliferation of personal data. Questions abound about how best to manage access to personal information, how to control its spread, and how to signal its quality and sensitivity. With such goals in mind, privacy is concerned with minimizing harm to consumers, to institutions, and even to society. Though there can be no perfect solution to these complex issues, it never hurts to consider them through a variety of legal and regulatory regimes. In his book, Antitrust Law in the New Economy, Mark R. Patterson provides a taste of the implications of the battle for control of personal information through an antitrust lens by focusing on the commodification of data. Show less

Since 1994, when Congress codified the Federal Trade Commission’s three-part test for unfair business practices, the FTC has been cautious in its use of charges of unfairness in consumer protection enforcement—instead relying primarily on charges of deception. This focus has led to “deception creep,” an expansion of the Commission’s perception of what constitutes deception to include acts and practices that may more classically be described as unfair. Overall, the FTC’s enforcement… Show more

Since 1994, when Congress codified the Federal Trade Commission’s three-part test for unfair business practices, the FTC has been cautious in its use of charges of unfairness in consumer protection enforcement—instead relying primarily on charges of deception. This focus has led to “deception creep,” an expansion of the Commission’s perception of what constitutes deception to include acts and practices that may more classically be described as unfair. Overall, the FTC’s enforcement effectiveness is reduced by adhering to a process that avoids applying the cost-benefit analysis required by the substantial injury prong of unfairness analysis. This neglect of unfairness enforcement reduces certainty in the consistency of FTC enforcement for businesses and consumers alike.

The FTC should embrace unfairness as an equal enforcement mechanism to deception. To properly utilize unfairness in privacy enforcement, the FTC must redefine the perimeters of unfairness and clearly draw the distinction between unfairness and deception. Once there is a defined understanding of when a violation falls under unfairness charges, the FTC can more effectively determine how best to utilize the codified unfairness test, including the cost-benefit analysis portion of determining whether an injury is substantial and constitutes an unfair practice.

To that end, we first briefly review the history of unfairness as an FTC enforcement tool, including trends in the frequency of its use. Next, we examine the unfairness test itself, analyzing the broad types of informational injuries that the FTC has deemed substantial in those privacy cases alleging unfairness Finally, we divide these previously recognized injuries into operational categories, showing that the FTC has engaged in an implicit balancing test that recognizes informational injury based on the value of personal data. Show less