A Look Ahead at Privacy and Data Security in 2018

by Wilson Sonsini Goodrich & Rosati

2018 promises to be an interesting year in the world of privacy and cybersecurity. In this article, we highlight a few of the most notable developments we expect this year, including major developments in Europe, changes and pending cases at the Federal Trade Commission (FTC), notable U.S. Supreme Court cases scheduled to be decided this year, and some areas of legislation that actually may become law in the U.S.

Big Changes Taking Effect in the European Union

One of the biggest areas where everyone in the privacy field will be looking in 2018 is the European Union (EU). On the legislative front, the General Data Protection Regulation (GDPR) will enter into force on May 25, 2018; the proposed e-Privacy Regulation is scheduled to be adopted this year; and the EU parliament will issue a report on the proposed Regulation on Non-Personal Data. Additionally, the Court of Justice of the EU (CJEU) will rule on several important data protection cases, including on third-party tracking, the right to be forgotten, and the possibility of class actions.

The GDPR takes effect on May 25, and companies and regulators are working hard to get ready. The Article 29 Working Party (WP29), the body of EU regulators, has issued guidance on a number of topics, including data breaches, transparency, and consent, and is expected to continue issuing guidance on key GDPR topics, including cross-border data transfers. This year, WP29 also will elect a new chairperson who will take over from Isabelle Falque-Pierrotin, and who will oversee WP29’s transition to the “European Data Protection Board.”

The e-Privacy Regulation, which complements the GDPR with specific rules for electronic communications services, is expected to be adopted in the second half of 2018. The e-Privacy Regulation replaces the e-Privacy Directive and significantly broadens its scope, covering over-the-top service providers such as instant messaging, VOIP, and machine-to-machine communications. By May 2018, EU member states also will have to implement the EU Directive on security of network and information systems (NIS Directive), which sets cybersecurity rules for operators of essential services.

Finally, the CJEU is expected to rule on a number of data protection cases this year. Notably, Schrems v. Facebook will determine whether a consumer can bring a class action on behalf of others, and whether the class can be EU-wide or even global (Case C-498/16); Fashion ID will clarify who is responsible for getting consent for tracking via social media plugins embedded in a website (Case C-40/17); and Google v. CNIL will outline the territorial scope of the right to be forgotten (Case C-507/17).

Changes and Notable Forthcoming Cases at the FTC

The  primary privacy enforcer in the United States, the FTC, will be undergoing significant changes in 2018. President Trump has nominated three individuals to become new FTC commissioners and fill the current vacancies that have left the FTC operating with only two commissioners since the departure of Edith Ramirez in February 2017. Joseph Simons is the president’s pick to serve as the new FTC Chairman. Simons’ background is as an antitrust attorney, so his approach to privacy and data security enforcement remains to be seen. He is expected to be joined by President Trump’s other two commissioner nominees: Noah Phillips, chief counsel for Sen. John Cornyn (R-TX), and Democrat Rohit Chopra of the Consumer Federation of America. If confirmed by the Senate, Simons would replace Commissioner Terrell McSweeny, whose term expired in September 2017. The president has announced his intent to nominate Acting Chairman Maureen Ohlhausen, who has been leading the agency since February 2017, to the U.S. Court of Federal Claims.

In addition to changes at the top, two notable FTC cases are likely to make a significant impact this year on the scope of the commission’s authority to regulate data security practices under Section 5 of the FTC Act: LabMD and D-Link. Most notable is the FTC’s long-running case against LabMD, a now-defunct firm accused by the agency of inadequately protecting sensitive patient health records. The FTC’s complaint was initially dismissed by an administrative law judge in 2015, which the commission then reversed in 2016, finding LabMD liable for unfair data security practices. LabMD then appealed the FTC’s decision to the U.S. Court of Appeals for the Eleventh Circuit, which heard oral arguments on the case last June. At issue is whether the FTC has the authority to bring actions under the unfairness prong of Section 5 against companies that, in the commission’s view, fail to implement reasonable security measures to protect consumer data. During oral argument, the Eleventh Circuit justices particularly focused on whether the exposure of patient data that triggered the FTC’s investigation and complaint actually caused or was likely to cause any harm to consumers sufficient to meet the unfairness standard under Section 5. The resolution of this case has the potential to either cement the status quo (that the FTC has broad authority to bring data security actions under the unfairness standard) or significantly upend the FTC’s approach to data security enforcement.

Another notable and rare FTC case regarding data security issues is the commission’s suit against D-Link Systems, in which the FTC alleged that the company failed to adequately secure the routers and IP cameras that is sells to consumers. The complaint alleges five counts for deceptive marketing practices and one count for unfair practices under Section 5 of the FTC Act, but in September 2017, the U.S. District Court for the Northern District of California issued a mixed ruling dismissing two of the deception counts and the unfairness count. On the unfairness count, the court held that the FTC had failed to allege any actual consumer injury and had only alleged “likelihood” of “risk” to consumers’ data. The court further held that FTC’s allegations about potential injury were “conclusory” and that the complaint “lack[ed] . . . facts indicating a likelihood of harm.” While the court left open an avenue for the FTC to replead its unfairness claim, the agency has since apparently decided not to amend its complaint and the case will proceed on the remaining three deception counts. A bench trial for the case is currently scheduled to take place in October 2018.

Privacy, Technology, and Law Enforcement Before the U.S. Supreme Court

Last fall, the Supreme Court heard arguments in a case that will have repercussions for how tech companies that collect location data respond to law enforcement requests for that information. The case, Carpenter v. United States, centers on defendant Timothy Carpenter’s conviction for multiple armed robberies. As part of the evidence admitted against Carpenter, the prosecutors introduced 127 days of Carpenter’s cell phone records, which confirmed that his cellphone was in the vicinity of where the multiple robberies took place during the commission of the crimes. The records were obtained from Carpenter’s cell phone provider without a warrant under the Stored Communications Act (SCA).

The question before the Court is whether a warrant should be required for 127 days of locational data, even when such data is held by a third party. The United States argues, under the third party doctrine established in Smith v. Maryland, that the records are merely third-party business records. The ACLU, on behalf of Carpenter, counters, however, that location data should be subject to heightened requirements under the Fourth Amendment because of the uniquely private and intimate nature of the data, particularly when it spans a large time period.

Court watchers doubt that the case will be resolved in favor of the United States. At oral arguments, many of the justices appeared to agree that the data at issue should not be treated the same as other business records. But how the justices will draw the line is unclear. It is possible that the Court will find that a limited amount of data can be collected without a warrant, or it may carve business records of location data out of the third party rule.

In another notable case, in February 2018, the Supreme Court will hear arguments regarding another effort by federal law enforcement officials to obtain data from a tech company. In United States v. Microsoft, Inc., the United States obtained a search warrant under the Stored Communications Act for the contents of a non-U.S. citizen’s msn.com email account. Microsoft moved to quash the warrant, arguing that search warrants do not have extraterritorial application, and the content data at issue is stored outside of the U.S. in Ireland. The Second Circuit agreed with Microsoft; the United States appealed to the Supreme Court.

Generally, when records are located in another country like Ireland, the United States has to make a request for the information through its Mutual Legal Assistance Treaty (MLAT) with that country. MLATs have long been the standard for obtaining criminal evidence abroad, with governments cooperating to meet the standards required under the law of the country where the records are located.

In this case, however, the United States argues that the SCA has no textual geographic limitation, and because Microsoft is located in the U.S. and the electronic data at issue is under Microsoft’s “control” (that is, could be electronically transmitted back to the U.S.), prosecutors should be able to obtain the data using United States legal process in the U.S.

A team of WSGR attorneys, led by Brian Willen, has filed an amicus brief on behalf of Privacy International and 25 other digital and human rights NGOs. The brief, in support of Microsoft, argues that the potential conflict with the laws and interests of Ireland and the EU, as evidenced by their comprehensive privacy legislation, should cause the Court to deny extraterritorial effect to the SCA, as it was not explicitly granted by Congress.

Regardless of the decision by the Supreme Court, this issue is likely to only be another chapter in the long-running clash between the U.S. and the EU regarding access to user data held by technology companies.

Both cases will be decided before the Supreme Court’s July 2018 recess.

Pending Legislation

Significant security breaches in 2017 triggered renewed interest in enacting federal data security legislation, though whether any of the currently proposed laws will actually make their way through both houses of Congress and past the president’s desk remains highly uncertain. Nevertheless, there are a couple subject areas worth monitoring in the new year. First among these are proposals to unify the current patchwork of state data breach notification laws that make current breach notifications so cumbersome for businesses and potentially confusing for consumers. Federal data breach notification laws have been proposed and have failed for years, and 2018 may be no different, but there remains a chance that the outsized impact of the Equifax data breach and the delay in disclosure of Uber’s data breach may provide the political motivation necessary to move the needle. One such bill, the Data Security and Breach Notification Act was proposed by three Democratic U.S. senators at the end of November 2017. In addition to the bill’s broad notification requirements, notable other features include a directive to the FTC to issue data security rules, a requirement that breaches be reported within 30 days, and criminal penalties for any individuals who knowingly conceal a data breach.

Another piece of legislation to watch that is much closer to becoming law is federal autonomous vehicle legislation. In September, the U.S. House of Representatives passed the SELF DRIVE Act, which aims to create a framework for the development and regulation of autonomous vehicles. Under the act, companies deploying autonomous vehicles would have to implement a “privacy plan” outlining the company’s collection, use, sharing, and storage of information about vehicle owners or occupants. On the U.S. Senate side, the Senate Commerce Committee approved the similar AV START Act in October 2017, though the bill is currently held up by holds in the full Senate. The Senate bill would require the National Highway Traffic Safety Administration (NHTSA) to create an online database of vehicle manufacturer privacy policies, and would require manufacturers of autonomous vehicles to implement plans for identifying and reducing cybersecurity risks vehicle safety. Despite its current holdup in the Senate and differences with the House bill, autonomous vehicle legislation remains one of the rare areas with bipartisan support in both houses of Congress, so some form of this legislation has a good chance of being signed into law this year, likely with some variety of privacy and security provisions included.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Wilson Sonsini Goodrich & Rosati | Attorney Advertising

Written by:

Wilson Sonsini Goodrich & Rosati

Wilson Sonsini Goodrich & Rosati on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at www.jdsupra.com) (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at privacy@jdsupra.com.

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.