Senate Hearing on Consumer Privacy Highlights Pending Legislation

On March 16, 2011, the U.S. Senate Committee on Commerce, Science, and Transportation held a hearing to examine online consumer privacy, with an emphasis on the use of behavioral targeting by online advertisers. The hearing, which included two panels of witnesses from the government and industry sectors, touched upon a growing number of legislative and regulatory proposals that attempt to strike a balance between protecting consumer privacy, ensuring continued business innovation, and preserving the free and diverse online content to which consumers have grown accustomed.

Committee members attending the hearing included Sen. John Kerry (D-MA), Sen. Mark Pryor (D-AR), Sen. Amy Klobuchar (D-MN), Sen. Johnny Isakson (R-GA), and Sen. Claire McCaskill (D-MO). Sen. Kerry, current Chairman of the Subcommittee on Communications, Technology, and the Internet, opened the hearing with statistics that reflect Americans’ concern about online tracking. He described online applications as observational opportunities” for data collection companies, and noted the increasing ability to merge offline and online information to create highly-detailed consumer profiles. Stating that we cannot let the status quo stand,” Sen. Kerry briefly described the legislation he is drafting with Sen. John McCain (R-AZ). The bill will propose a commercial privacy bill of rights” that would establish a common code of conduct, which Sen. Kerry believes would encourage information sharing by establishing general protections for consumers while creating fair terms and conditions for online businesses.

Committee Chairman Jay Rockefeller (D-WV), who did not attend the hearing, issued a statement voicing his support for legislation that would impose basic privacy rules, and described self-regulatory efforts in the privacy area as a failed experiment.”

A summary of the two panel sessions is set forth in the Kelley Drye client advisory.