Video service Netflix has disclosed it paid out £5.7 million last year to settle a class-action lawsuit that it violated privacy by keeping records on what subscribers watched two years after customers had canceled their plans.
The lawsuit, brought by two Virginia residents, claims actions by Netflix violated the Video Privacy Protection Act, and Netflix indicated in a Securities and Exchange Commission filing that it settled the lawsuit, without admitting wrongdoing, in 2011.
Netflix is continuing to lobby for change in the Video Privacy Protection Act, which was passed in 1988 after an public uproar erupted after the press was leaked the VHS rental history of Robert Bork, who in 1987 had been nominated to the Supreme Court. The video rental history was unremarkable. But outage over the privacy violations led Congress to pass legislation to prohibit keeping records on what subscribers watch a certain time period after they cancel.
Ellen Messmer is senior editor at Network World, an IDG publication and website, where she covers news and technology trends related to information security.