Privacy Law Blog : Privacy Lawyers & Attorneys : Proskauer Rose Law Firm : CAN-SPAM, FCRA, FACTA

Expect the unexpected from your Web site privacy policy. In a handful of cases, including two which were recently decided, companies have been thwarted in various, unexpected ways by the commitments made in their online privacy policies.

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On August 10, 2010, the U.S. Court of Appeals for the Seventh Circuit upheld an earlier ruling by the Northern District of Illinois Eastern Division that email order confirmations are not “electronically printed” receipts under the Fair and Accurate Credit Transactions Act (“FACTA”) amendments to the Fair Credit Reporting Act. Shlahtichman v.1-800 Contacts Inc., Case No. 09-4073 (7th Cir.; Aug. 10, 2010) is available here. The court affirmed the dismissal of Shlahtichman’s complaint against 1-800 Contacts Inc. that involved an electronic order confirmation containing Shlahtichman’s credit card expiration date.

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Illinois recently enacted legislation that broadly restricts a private employer from using credit reports regarding job applicants or current employees. Subject to certain exceptions, an employer may not inquire about, order, or obtain a job applicant’s credit report, or fail or refuse to hire or recruit an individual based on the individual’s credit report or history. With respect to current employees, an employer may not discharge or otherwise discriminate against an employee because of the employee’s credit history or credit report. The law also prevents an employer from requiring an applicant or employee to waive any rights under the new law and prohibits retaliatory and discriminatory acts by the employer. Importantly, the law creates a private right of action for an individual to seek injunctive relief and damages and provides for prevailing-party attorneys’ fees.

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Rite Aid has agreed to pay $1 million to resolve allegations that it violated the Health Insurance Portability and Accountability Act (“HIPAA”) by pitching pill bottles and prescription information into publicly accessible dumpsters near Rite Aid stores. According to the Department of Health and Human Services’ resolution agreement, released on July 27, Rite Aid must implement a three-year corrective action program, which includes the adoption of revised policies and procedures concerning the disposal of sensitive health-related information, employee training programs related to the revised policies and procedures and penalties for employees that fail to comply with them.

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