Judge: Hulu Must Face Privacy Lawsuit

HULU video service logo website online movies and tv shows
Cassandra Hubbart, AOL
By Jonathan Stempel

NEW YORK -- Hulu has failed to persuade a federal judge to dismiss a lawsuit accusing the video streaming service of illegally sharing users' viewing history with Facebook (FB) and business metrics company ComScore (SCOR)

U.S. Magistrate Judge Laurel Beeler in San Francisco on Friday rejected Hulu's argument that viewers needed to show actual injury to recover damages, even if they qualified as "aggrieved" persons under a 1988 federal law protecting the privacy of video renters.

That law, the Video Privacy Protection Act, was adopted after a newspaper in 1987 published an article about movies that the Supreme Court nominee Robert Bork had rented. Hulu had argued that the law "was not adopted to impose multibillion dollar liability on the transmission of anonymous data where no one suffers any actual injury."

Beeler, however, %VIRTUAL-article-sponsoredlinks%concluded that "the statute requires only injury in the form of a wrongful disclosure" before damages might be available. She didn't rule on the merits of the case.

Hulu is a joint venture owned by Comcast's (CMCSA) NBCUniversal, 21st Century Fox's (FOX) Fox Broadcasting, and Walt Disney's (DIS) ABC. Chief Executive Officer Mike Hopkins on Dec. 18 said Hulu will post $1 billion of revenue in 2013, up from $695 million in 2012.

The lawsuit seeks class-action status on behalf of Hulu users nationwide. It was brought by several people in California, Illinois and New York seeking damages of at least $2,500 per violation, plus punitive damages and other sums.

These plaintiffs claimed that Hulu let third parties engaged in marketing, advertising, and social networking track their video choices without permission.

They claimed that Hulu sent such information to Scorecard Research, a comScore market research unit, and sent "Facebook IDs that linked their video choices to personally identifiable Facebook registration information."

Hulu didn't immediately respond on Monday to a request for comment. Its lawyer Robert Schwartz didn't immediately respond to a similar request. David Parisi, a lawyer for the plaintiffs, also didn't immediately respond to such a request.

Hulu has separately argued it would be too hard to certify a class of plaintiffs. It noted that many users employ fake names, including 644 named "Homer Simpson," 450 named "Mickey Mouse," 131 named "Santa Claus" and 18,581 named "John Doe."

Beeler has also scheduled a February 6, 2014 hearing on Hulu's second motion to dismiss the case. There, Hulu claimed it didn't knowingly transmit protected information to Facebook and comScore in a manner that violated the VPPA.

The case is In re: Hulu Privacy Litigation, U.S. District Court, Northern District of California, No. 11-03764.

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