- The Dangers of Overly Broad Privacy Policies
- September 30, 2010 | Authors: Benjamin Gastel; John P. Hutchins
- Law Firm: Troutman Sanders LLP - Atlanta Office
The 2005 Amendments specifically provide for restrictions on sale of “personally identifiable information,” which is defined to include all personal information about individual consumers that may be held by a debtor in a bankruptcy proceeding. Specifically the definition encompasses “any...information concerning an identified individual that, if disclosed, will result in contacting or identifying such individual physically or electronically.” XY’s customer list falls squarely under this definition.
As a result, based on the recommendations of both the Consumer Privacy Ombudsman and the FTC, the entire subscriber list in XY’s case was deleted, with certain limited exceptions, effectively destroying the most lucrative and valuable asset involved in the bankruptcy proceeding.
This case obviously highlights the dangers involved in crafting overly broad privacy policies. It is always difficult to plan for the unexpected, and very few companies plan ahead for bankruptcy, but consumer privacy policies should be crafted to ensure that a business’s valuable assets remain liquid and transferrable whenever such a transfer may need to take place in the best interest of the company and its shareholders.