Data Privacy: The Importance of Proper Implementation

Among the dozens of state data privacy laws, including New Jersey and Connecticut, businesses are required to provide consumers with clear and meaningful opt-out rights.

In particular, the right to opt-out of the sale of their data, the right to opt-out of targeted advertising, and the right to opt-out of automated profiling that produces legal or similarly significant effects. It is not sufficient to simply list these rights solely within a company’s privacy policy.

A recent $2.75 million settlement between The Walt Disney Company and the California Attorney General demonstrates this point: businesses must provide clear notice of opt-out rights, and opt-out mechanisms must be fully operational, especially in the context of targeted advertising, as technical limitations are not a valid excuse.

The California AG’s investigation found that Disney’s superficial opt-out mechanisms had critical gaps that failed to halt Disney’s unauthorized use of customer data. Disney’s seemingly compliant opt-out features, including, compatibility with the Global Privacy Control (GPC Signal), webform opt-out requests, and opt-out toggles had several flaws that fell short of the legal requirements.

As enforcement in California and the tri-state area continues to increase, companies must move beyond compliance approaches that focus only on what must be stated. Instead, companies need to ensure that their systems are capable of honoring consumers’ state opt-out rights when applicable.

What GS2Law can do for you:

• Assess whether your data practices trigger obligations to provide consumers with opt-out rights
• Draft or update your privacy policy to clearly and accurately disclose consumer rights, including opt-out rights
• Evaluate whether your current opt-out mechanisms are compliant, functional, and consumer-friendly
• Provide practical recommendations to strengthen compliant opt-out mechanisms before enforcement becomes an issue

The information contained in this post is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. If you would like to speak with a lawyer at GS2Law in confidence you can schedule a confidential consultation by requesting an appointment online today.