On December 1, 2011, a consolidated litigation against Netflix was ordered to private mediation pursuant to an agreement between the parties. As we previously reported, the plaintiffs allege that Netflix’s practice of maintaining customer movie rental history and recommendations after their subscriptions are cancelled violates the federal Video Privacy Protection Act (“VPPA”). In August 2011, several similar cases against Netflix were consolidated by a federal court in California.
News of the mediation order comes as a significant amendment to the VPPA awaits Senate approval. On December 6, 2011, the House of Representatives passed House Bill 2471 (“H.B. 2471”), which would allow video tape service providers to obtain consumers’ informed, written consent to disclose their personally identifiable information “[i]n advance for a set period of time or until consent is withdrawn.” H.B. 2471 also provides that “informed written consent” may be obtained electronically over the Internet. As we reported earlier this year, concerns regarding potential VPPA violations prompted Netflix to delay the U.S. launch of an integrated service with Facebook that would allow subscribers to share their television and movie viewing information. In July 2011, Netflix’s CEO criticized the VPPA as being “ambiguous” and “poorly drafted.” Discussing H.B. 2471 on the Netflix Blog, the company called on its customers to email Congress “to urge them to pass this modernizing legislation.”