by Roy Mark of dc.internet.com [March 24, 2001]

The Information Technology Association of America (ITAA) is raising the specter of trial lawyers being "set loose" on high tech and e-commerce companies if federal privacy legislation containing provisions allowing for private rights of legal action is approved.

Speaking before a forum on online privacy in Arlington, Va., ITAA Vice President and Counsel Mark Uncapher warned the high tech industry not to fall victim to a "bait and switch" on online privacy legislation.

"Supporting legislation in expectation of securing federal pre-emption of state online privacy laws may, in the end, force companies to accept 'private right of action' clauses that will gravely harm Internet companies," Uncapher said.

Punitive privacy
Uncapher advised that any legal actions should result in reparation for privacy violations not in excess of actual damages.

"We oppose legislation that allows trial lawyers to be set loose on high tech and e-commerce companies," he said.

Uncapher also said any privacy proposals should be measured against the following yardstick:

• Consumer choice: To the maximum extent possible, consumers should be empowered to make their own privacy choices. Individual privacy preferences vary greatly so government regulation would be hard pressed to address the many variations of individual preference.
• Uniformity: In a networked economy, the exchange of information is an essential component to commerce. The interests of the Constitution's Commerce clause are served by having uniform national privacy rules.
• Proportionate penalties: Penalties must be proportionate to actual consequences. Proposals for private rights of actions and minimum penalties raise the specter of trial lawyers using lawsuits to target Internet companies for even innocent mistakes.
• Technology neutrality: Rules for privacy should not change depending upon the medium used to collect information.

"I ask you to support the development of consumer empowerment tools that let individual Americans, not government bureaucrats, define and implement online privacy preferences," he noted.

The ITAA consists of over 500 direct and 26,000 affiliate corporate members throughout the U.S., and a global network of 41 countries' IT associations. ITAA members range from the smallest IT start-ups to industry leaders in the Internet, software, IT services, ASP, digital content, systems integration, telecommunications, and enterprise solution fields.

The secrets out
There are more than 30 different legislative initiatives at play on Capitol Hill right now. Certainly, we should anticipate that the Spyware Control and Privacy Protection Act of 2001, which seeks to establish rules for the disclosure of the collection of information through computer software to built upon the cornerstone of individual privacy. But elements of the Bankruptcy Reform Act, Parent Act, as well as the Community Technology Assistant Act each embrace privacy as a fundamental right.

Business and online marketing lobbyists have powerful incentives to keep up the fight. Current legislation that would bar education companies from disclosing students' Web surfing without parental permission could hurt companies like N2H2, which aggregates and sells student data.

What's obvious is that privacy isn't just an Internet issue anymore and federal legislators don't seem to comprehend that their lawmaking efforts are not the solution—they are part of the problem.

— End    

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