FTC Sets Hearings on Privacy and Data Security Enforcement

Last week the Federal Trade Commission (FTC or Commission) announced it will address privacy and data security enforcement as part of its ongoing Hearings on Competition and Consumer Protection in the 21st Century.[1] It will hold four days of hearings examining “the FTC’s authority to deter unfair and deceptive conduct in data security and privacy matters.”[2] A Wiley Rein LLP Client Alert on the Hearings and their importance to the tech sector is available here.

The FTC’s primary enforcement authority is found in Section 5 of the FTC Act and prohibits unfair or deceptive practices in the marketplace.[3]  This broad authority allows the Commission to address a wide array of practices affecting consumers, including those that emerge from the development of new technologies and business models. Under this authority, the FTC has brought dozens of enforcement cases against companies that have engaged in practices that the agency determined failed to adequately protect consumers’ data.[4] 

The hearings on data security are slated for December 11 - 12, 2018 and will examine private sector incentives to invest in data security and the FTC’s data security enforcement program, among other topics.[5]   Related to consumer privacy, the FTC has scheduled hearings for February 12 - 13, 2019.[6]   According to the Commission, it will be the first comprehensive re-examination of its approach to consumer privacy since 2012.  Through December 21, 2018, FTC staff is seeking comment on what the privacy hearings should cover specifically. 

Wiley Rein LLP has actively engaged with the FTC’s privacy and data security initiatives.  In September, as part of its Outlook on Cyber series, the firm hosted Bilal Sayeed the Director of the Office of Policy and Planning and James Cooper the Deputy Director for Economic Analysis in the Bureau of Consumer Protection.  Both FTC officials play key roles in driving the Hearings.  At the Outlook event, the FTC encouraged stakeholders to submit comments with tangible, data-driven analysis on the topics of privacy and cyber harm. 

The Commission is seeking new thinking on these subjects and will weigh stakeholder feedback with an open mind.   As Chairman Joe Simons said in announcing this effort, the FTC plans to engage in “serious reflection and evaluation” so that the agency is “better able to promote competition and innovation, protect consumers, and shape the law, so that free markets continue to thrive.”[7]

Industry and stakeholder comments on both data security and privacy may be submitted through March 13, 2019.  

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[1] See FTC, Hearings on Competition and Consumer Protection in the 21st Century, available at: https://www.ftc.gov/policy/hearings-competition-consumer-protection.

[2] See FTC, FTC Announces Sessions on Consumer Privacy and Data Security As Part of its Hearings on Competition and Consumer Protection in the 21st Century (Oct. 26, 2018) available at: https://www.ftc.gov/news-events/press-releases/2018/10/ftc-announces-sessions-consumer-privacy-data-security-part-its.

[3] 15 U.S.C. § 45.

[4] See FTC, Privacy & Data Security Update: 2017, 2 (Jan. 18, 2018), available at:  https://www.ftc.gov/system/files/documents/reports/privacy-data-security-update-2017-overview-commissions-enforcement-policy-initiatives-consumer/privacy_and_data_security_update_2017.pdf

[5] FTC, FTC Hearing on Competition and Consumer Protection in the 21st Century - December 2018,  available at: https://www.ftc.gov/news-events/events-calendar/ftc-hearing-competition-consumer-protection-21st-century-december-2018.

[6] FTC, FTC Hearing on Competition and Consumer Protection in the 21st Century - February 2019, available at: https://www.ftc.gov/news-events/events-calendar/ftc-hearing-competition-consumer-protection-21st-century-february-2019.

[7] FTC, FTC Announces Hearings On Competition and Consumer Protection in the 21st Century (Jun. 20, 2018) available at: https://www.ftc.gov/news-events/press-releases/2018/06/ftc-announces-hearings-competition-consumer-protection-21st?utm_source=slider.