The Seventh Circuit Court of Appeals affirmed summary judgment in favor of Redbox Automated Retailer (“Redbox”), in a suit alleging that Redbox violated the Video Privacy Protection Act, 18 U.S.C. § 2710 (“VPPA”).  Sterk v. Redbox Automated Retailer, LLC, No. 13-3037 (7th Cir. Oct. 23, 2014).  The VPPA prohibits “video tape service providers” from knowingly disclosing “personally identifiable information” (“PII”) regarding their consumers. 

Redbox outsources its customer service operations to third-party Stream Global Services, which handles customer inquiries through a service call center.  If resolution of a customer’s issue requires accessing that customer’s video rental history (for example, if a Redbox kiosk charged a customer for a movie, but failed to dispense the rental), the call center representative (a Stream employee) may access Redbox’s customer database.  The named plaintiffs alleged that by permitting Stream to access its customer data, Redbox violated the VPPA.

The VPAA, however, provides several exceptions to the disclosure prohibition, including disclosure that occurs in the “ordinary course of business,” which is statutorily defined as “debt collection activities, order fulfillment, request processing, and the transfer of ownership.”  Redbox moved for summary judgment, arguing that permitting Stream to access its customer database for the purpose of responding to customer inquiries constituted access in the ordinary course of business.  The District Court agreed, holding that the activities constituted “request processing,” and thus fell within the “ordinary course of business” exception as a matter of law. 

On appeal, the United States Court of Appeals for the Seventh Circuit affirmed judgment in favor of Redbox.  The plaintiffs argued that “request processing” under the VPAA was limited solely to the processing requests for specific video materials.  The Seventh Circuit rejected this argument, noting that personally identifiable information under the VPAA was not limited to “specific video materials” but included other “services from a video tape provider.”  As the customer service function that Stream provided for Redbox constituted a “request for service,” the Seventh Circuit affirmed that the conduct fell within the “ordinary course of business” exception, such that the plaintiffs’ claim failed as a matter of law. 

A copy of the Seventh Circuit’s decision is available here.