Second Circuit departs on meaning of “consumer” under the U.S. Video Privacy Protection Act

Background

In Salazar, the plaintiff alleged that he had signed up to receive a free online newsletter from the NBA to his personal email address and that he later visited the NBA website and watched videos (for free) on the NBA website. He also claimed that, through use of the Meta Pixel on the NBA’s website, the NBA had unlawfully disclosed to Meta: (1) the title of videos he watched; (2) the URLs of the webpages where those videos were located; and (3) his Facebook ID (which Meta could tie to his Facebook profile and name). The district court found that Salazar had standing to pursue his claims because the data shared with Meta caused him a harm analogous to a privacy interest that the common law traditionally protected. But the district court dismissed Salazar’s suit on the ground that he did not qualify as a “consumer” under the VPPA because he did not rent, purchase, or subscribe to the NBA’s audio-visual services or products specifically, but instead used the NBA’s website generally. Salazar appealed the district court’s decision.

Standing

The Second Circuit first found that Salazar had standing to bring his suit. Drawing on TransUnion LLC v. Ramirez, 594 U.S. 413, 434 (2021), the Court noted that a plaintiff may still show standing even for pure statutory violations if the violations are analogous to a traditional common law harm. The Court then analogized the alleged VPPA violations to the harm associated with the common law tort of public disclosure of private facts. The Court held that the intentional disclosure of the data to Meta by the NBA was, in many ways, even closer to traditional common law harms than accidental exposure from a data breach. The Court then distinguished cases in which plaintiffs were found to lack standing to bring claims under the Fair Debt Collection Practices Act based on debt collectors' sharing of private information with third-party intermediaries, like mail vendors, because those cases involved third parties used only to provide the consumer with their own information. In contrast, Meta allegedly used the data provided for commercial purposes, namely, to target plaintiff with advertisements based on his internet browsing history.

VPPA

On the merits, the Second Circuit held that the VPPA is not limited to consumers of a video tape service provider’s audiovisual goods or services. The VPPA defines “consumer” to mean “any renter, purchaser, or subscriber of goods or services from a video tape service provider.” 18 U.S.C. § 2710(a)(1). Since Salazar did not claim that he was a renter or purchaser of any audiovisual materials, the chief question was whether Salazar was a “subscriber of goods or services.”

“Goods and services” not limited to audiovisual materials

The Court first analyzed whether the NBA’s newsletter was a good or service under the VPPA.  The NBA argued that “goods and services” under the VPPA is cabined to audiovisual goods and services, consistent with the reasoning endorsed by several lower federal courts. See, e.g., Carter v. Scripps Networks, LLC, 670 F. Supp. 3d 90, 96-99 (S.D.N.Y. 2023). The Second Circuit disagreed. First, it observed that this definition’s use of the words “any” and “or” reflected Congress’s intent that this statute should be construed liberally. The Court also noted that where Congress wanted to include an audiovisual limitation in the VPPA, it knew how to do so, pointing out that the statute’s definition of “video tape service provider” was limited to “any person, engaged in the business, in or affecting interstate or foreign commerce, of rental, sale, or delivery of prerecorded video cassette tapes or similar audio visual materials.” 18 U.S.C. § 2710(a)(4).  Further, the Court noted that if “goods or services” were limited to audiovisual materials, then the statute’s definition of “personally identifiable information” as “information which identifies a person as having requested or obtained specific video materials or services from a video tape service provider,” id., would be superfluous.

Notably, the Court refused to accept the plaintiff’s invitation to define the outer bounds of the VPPA’s reach by deciding whether the phrase “renter, purchaser, or subscriber” in the “consumer” definition was intended to mirror the phrase “rental, sale or delivery” in the definition of “video tape service provider.” In a footnote, however, it noted that this logic would imply that someone who simply watches online videos could be considered a “consumer” for purposes of the VPPA.

No monetary exchange needed to subscribe to goods and services

Having decided that the VPPA covers someone who subscribes to any good or service offered by a video tape service provider, the Court next considered whether Salazar had adequately alleged that he had subscribed to the NBA’s newsletter, even though he did not pay the NBA any money to do so.  The Second Circuit found that he had, joining the First and Eleventh Circuits in holding that a subscription does not require a consumer to provide monetary compensation. Instead, the Court found that Salazar had alleged a sufficient “relationship” with the NBA through his provision of certain “personal information when he signed up for the newsletter.”  The provision of this “valuable personal information” made Salazar’s relationship with the NBA different from the kind the NBA shared with any casual NBA.com video-watcher who had not signed up for the newsletter.

Definition of “personally identifiable information” under the VPPA

The Second Circuit cabined its decision by noting that the VPPA only covers “personally identifiable information,” which is limited to information “related to audiovisual materials or services.” That construction was necessary in order to ensure that a general store owner who also rents out a few movies would not be liable under the VPPA for disclosing a customer’s “bread-buying habits.” However, the Court did noted by footnote that there “may be breathing room in the statute to explore what constitutes ‘personally identifiable information.’” This language may lead plaintiffs’ counsel to become more creative with the types of information they try to allege should be covered by the VPPA.

Authored by Jasmeet K. Ahuja, Peter W. Bautz, Aidan Coleman, and Alex Ervin.