Microsoft Supports Narrow Consumer Right to Sue in Privacy Bill

Microsoft Corp.’s chief privacy officer said she thinks a federal privacy law should give consumers limited rights to sue companies to stop violations.

Julie Brill made the comments on Wednesday during testimony before the Senate Commerce Committee, which is leading congressional efforts to write national privacy legislation.

In response to questions from Senator Richard Blumenthal, a Democrat from Connecticut, Brill said, “Having individuals have the ability to obtain injunctive relief is important.” Brill stopped short of supporting broader rights for consumers to sue for damages.

In a sign that consensus could be forming around consumers’ right to sue, the panel’s chairman, Republican Senator Roger Wicker, on Monday floated the idea of allowing a narrowly focused private right of action for consumers in an interview with Bloomberg Government. Wicker had previously opposed legislation that would allow consumer lawsuits.

The hearing was the first to examine recent proposals that showed Republicans and Democrats remain divided on key issues such as treatment of state statutes and whether consumers should be allowed to sue companies.

Efforts to pass a federal privacy law have slowed in the past months and a vote seems unlikely in this Congress. Companies lobbying around the privacy initiatives have sought to avoid strict and divergent state regimes and were watching for Congress to act before California’s new privacy law goes into effect on Jan. 1. That goal is now almost certainly out of reach.

Microsoft has been among the more proactive companies in responding to new privacy rules and has already extended protections offered by Europe and California to its users. The software giant said in a Nov. 11 blog post authored by Brill that it would grant the “core rights” of California’s law -- the toughest state measure to date -- nationwide. Brill stopped short of embracing all the legal redress in the California measure, which allows consumers to sue for broad damages if they’re victims of a data breach due to failure to maintain reasonable security.

Brill, who is a former Federal Trade Commissioner, called on lawmakers to go beyond state provisions in fashioning a federal measure. Microsoft has also called for regulation of facial recognition software amid concerns that the technology can be biased or compromise privacy.

The software giant’s business model allows it greater flexibility in calling for strict privacy regulations because it relies less on consumer data than internet companies such as Alphabet Inc.’s Google and Facebook Inc. do that make money from data-powered advertising businesses.

The proposals that emerged last week showed that Republicans and Democrats have agreed on some issues but that key divisions remain.

Senator Maria Cantwell, the top Democrat on the committee, released a bill Nov. 26 with three of the panel’s other Democrats that would allow consumers to sue in certain circumstances if their privacy is violated. That proposal would also allow states to pass laws that are stricter than a federal measure.

Nuala O’Connor, a lawyer for Walmart Inc., told the committee that the retailer shares “broader industry concerns” about those two provisions.

Wicker’s draft would overrule individual state laws in favor of a national standard, although the two are in negotiations for a bipartisan bill.

Both Wicker and Cantwell proposals would give consumers the ability to access, correct, delete and transport personal data that is held by big technology companies. Several business groups have embraced that approach, although the co-chair of a coalition including telecommunications companies such as AT&T Inc. and Verizon Communications Inc. told the panel that consumers should have less control over non-sensitive data.

Several other members are also working on separate efforts.

“Only a bipartisan proposal has a chance of clearing the Senate and becoming law,” the Senate’s No. 2 Republican and a former chairman of the committee, John Thune, said during the hearing.

To contact the reporters on this story:
Ben Brody in Washington, D.C. at btenerellabr@bloomberg.net;
Rebecca Kern in Arlington at rkern21@bloomberg.net

To contact the editors responsible for this story:
Sara Forden at sforden@bloomberg.net

Zachary Sherwood

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