United States: FCC Privacy Regulations: The Next Litigation Trend?

Article by Sam Castic, Aravind Swaminathan and Antony P. Kim

Last month the Federal Communications Commission ("FCC") closed the comment period for its proposed privacy regulations, which we previously wrote about here. The million dollar question on everyone's minds is whether the final regulations will be broader or narrower in scope than the initial proposal, which included not only a significant expansion of the definition of personal information, but also sweeping new obligations and raised serious questions in areas where the obligations could become even stricter still.[1] Accordingly, companies subject to the new regulations are bracing for tighter FCC Enforcement Bureau scrutiny of broad data collection and handling practices.

Fertile Ground for Class Actions.

FCC scrutiny, however, may be just the tip of the iceberg. Organizations should consider the significant possibility of consumer and class action litigation in evaluating the risk landscape.

The Communications Act has a rarely used provision that sets forth a private rights of action for violations of the Act itself or related regulations. Specifically, Section 206 of the Communications Act provides that common carriers—including broadband providers subject to the FCC's privacy regulations—may be liable to any person injured for the "full amount of damages sustained" from "any act, matter, or thing in this chapter prohibited or declared to be unlawful." Carriers are similarly liable for omissions to do any act, matter, or thing required to be done under the chapter. Importantly, these provisions include an ability to recoup attorney fees. A provision of Section 207 allows individuals to "bring suit for the recovery of the damages for which [the] common carrier may be liable" in any federal district court for violations of the chapter. "Chapter" is defined broadly and includes the primary provisions of the Communications Act that the FCC has proposed relying upon for the privacy regulations.

Such actions would not be without basis in precedent. The Supreme Court previously held that Section 207 authorized a private right of action to enforce regulations that the FCC issued pursuant to the Communications Act. In that context—a dispute between two companies—the Court held that the FCC regulations appropriately declared certain practices to be "unreasonable" (i.e., "unlawful" under the Communications Act) under Section 201 of the Act.[2] The Court reasoned that since the practices were "unlawful", the plaintiff could claim damages under Section 206, and maintain a suit for those damages under Section 207. The FCC's proposal to base its privacy regulations, in part, on Section 201—the same statutory basis for which the Supreme Court upheld a private right of action—would permit plaintiffs' class actions. Even if the statutory basis for the privacy regulations is not Section 201, there is still a strong argument that the Act would allow a private right of action to sue for damages allegedly suffered for violations of the regulations, as the regulations are issued pursuant to the Act, and Section 206 allows plaintiffs to seek damages for acts that are either prohibited or unlawful under the Act (and potentially, by the FCC regulations interpreting the Act).

It remains unclear the precise types of privacy rule violations the courts might be asked to decide. With the potential that the FCC's rules will broaden privacy obligations, among the possibilities are actions based on sharing of personal (potentially a broader construct) information for marketing purposes without the necessary consent; failure to comply with the consent recordkeeping requirements or to obtain consent just before the use or disclosure; or failure to notify individuals affected by a data breach within ten days.

There is some good news. Following the Supreme Court's recent decision in Spokeo, Inc. v. Robins, plaintiffs will not be able to simply allege a violation of a statutorily conferred right, such as those under Section 201. Instead, they may also have to allege an injury suffered. Given how broadly personal information may be defined under the new rules, alleging harm may not be an easy task.

What Should You Do?

Broadband providers should begin assessing the proposed privacy regulations against their existing business practices. This will give them a head start in dealing with the final regulations once they are issued. Thereafter an enterprise-wide assessment and modification to risky business practices can further reduce the chance of becoming targets for enforcement actions or litigation.

Companies that do business with broadband providers like cable companies and wireless carriers should consider careful review of their contractual obligations with those providers. At a minimum, they should understand which of these novel theories may implicate indemnification or duty to defend obligations by virtue of their practices with data—identifiable or not—that they are asked to deal with for broadband providers. Ambiguous contracts where each party promises to comply with applicable laws, but no party specifies what the laws are or how they will do so, could lead to new disputes to allocate liability between providers and companies that work with them. Finally, companies that work with broadband providers may want to understand the scope of the final regulations to understand what traps to look for in their agreements with providers.

Without a doubt, the new privacy regulations will provide a broader array of conduct for the FCC Enforcement Bureau to investigate and potentially penalize companies when it identifies improper privacy and data protection practices. But, the ground also appears to be fertile for potential plaintiffs to get involved. Accordingly, companies should begin to consider this landscape when making business calculations about resource allocation for compliance oriented activities, especially because the financial stakes are likely to be even higher with the plaintiffs' bar potentially testing the limits of the Communications Act's private right of action in alleging damages for violations of the FCC's privacy regulations.


[1] The proposed regulations do not just broaden the kinds of data that would be defined as personal information. They also propose new data protection, sharing and use requirements (even if the data is aggregated) that companies must document and train employees and vendors on. They further require that mistakes be reported to the FCC, and data breaches be reported to government officials and individuals within 7 and 10 days respectively. Unlike the various state laws, the proposed rule would require notification regardless of whether there is a risk of harm to individuals, and there is no safe harbor for inadvertent access by unauthorized employees. Ultimately, the rules will likely disrupt existing business practices, and create an environment where FCC regulated entities will need to disclose even more data breach incidents.

[2] Global Crossing Telecomm., Inc. v. Metrophones Telecomm. Inc., 550 U.S. 45 (2007).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.