Archives for January 2014

Twelve U.S. businesses have agreed to settle Federal Trade Commission charges that they falsely claimed they were abiding by an international privacy framework known as the U.S.-EU Safe Harbor that enables U.S. companies to transfer consumer data from the European Union to the United States in compliance with EU law.

The companies settling with the FTC represent a cross-section of industries, including retail, professional sports, laboratory science, data broker, debt collection, and information security. The companies handle a variety of consumer information, including in some instances sensitive data about health and employment. The twelve companies are:

• Apperian, Inc.: Company specializing in mobile applications for business enterprises and security;

• Atlanta Falcons Football Club, LLC: National Football League team;

• Baker Tilly Virchow Krause, LLP: Accounting firm;

• BitTorrent, Inc.: Provider of peer-to-peer (P2P) file sharing protocol;

• Charles River Laboratories International, Inc.: Global developer of early-stage drug discovery processes;

• DataMotion, Inc.: Provider of platform for encrypted email and secure file transport;

• DDC Laboratories, Inc.: DNA testing lab and the world’s largest paternity testing company;

• Level 3 Communications, LLC: One of the six largest ISPs in the world;

• PDB Sports, Ltd., d/b/a Denver Broncos Football Club: National Football League team;

• Reynolds Consumer Products Inc.: Maker of foil and other consumer products;

• Receivable Management Services Corporation: Global provider of accounts receivable, third-party recovery, bankruptcy and other services; and

• Tennessee Football, Inc.: National Football League team.

“Enforcement of the U.S.-EU Safe Harbor Framework is a Commission priority. These twelve cases help ensure the integrity of the Safe Harbor Framework and send the signal to companies that they cannot falsely claim participation in the program,” said FTC Chairwoman Edith Ramirez.

According to the twelve complaints filed by the FTC, the companies deceptively claimed they held current certifications under the U.S.-EU Safe Harbor framework and, in three of the complaints, also deceptively claimed certifications under the U.S.-Swiss Safe Harbor framework. The U.S.-EU and U.S.-Swiss Safe Harbor frameworks are voluntary programs administered by the U.S. Department of Commerce in consultation with the European Commission and Switzerland, respectively.  To participate, a company must self-certify annually to the Department of Commerce that it complies with the seven privacy principles required to meet the EU’s adequacy standard: notice, choice, onward transfer, security, data integrity, access, and enforcement. A participant in the U.S.-EU Safe Harbor framework may also highlight for consumers its compliance with the Safe Harbor by displaying the Safe Harbor certification mark on its website.

The FTC complaints charge each company with representing, through statements in their privacy policies or display of the Safe Harbor certification mark, that they held current Safe Harbor certifications, even though the companies had allowed their certifications to lapse. The Commission alleged that this conduct violated Section 5 of the FTC Act. However, this does not necessarily mean that the company committed any substantive violations of the privacy principles of the Safe Harbor frameworks.

Under the proposed settlement agreements, which are subject to public comment, the companies are prohibited from misrepresenting the extent to which they participate in any privacy or data security program sponsored by the government or any other self-regulatory or standard-setting organization.

Consumers who want to know whether a U.S. company is a participant in the U.S-EU or U.S.-Swiss Safe Harbor program may visit http://export.gov/safeharbor to see if the company holds a current self-certification.

These cases are being brought with the valuable assistance of the U.S. Department of Commerce. These companies were also the subject of complaints filed in 2013 by Chris Connolly and Galexia, Inc.

The Commission votes to accept the consent agreement packages containing the proposed consent orders for public comment were 4-0. The FTC will publish descriptions of the consent agreement packages in the Federal Register shortly. The agreements will be subject to public comment for 30 days, beginning today and continuing through Feb. 20, 2014, after which the Commission will decide whether to make the proposed consent orders final. Interested parties can submit written comments electronically or in paper form by following the instructions in the “Invitation To Comment” part of the “Supplementary Information” section. Comments in electronic form should be submitted using the following Web links:

• Apperian, Inc.

• Atlanta Falcons Football Club, LLC

• Baker Tilly Virchow Krause, LLP

• BitTorrent, Inc.

• Charles River Laboratories International, Inc.

• DataMotion, Inc.

• DDC Laboratories, Inc.

• Level 3 Communications, LLC

• PDB Sports, Ltd., d/b/a Denver Broncos Football Club

• Reynolds Consumer Products Inc.

• Receivable Management Services Corporation

• Tennessee Football, Inc.

Comments in paper form should be mailed or delivered to: Federal Trade Commission, Office of the Secretary, Room H-113, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. The FTC is requesting that any comment filed in paper form near the end of the public comment period be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions.