The fine print that could undermine new Internet privacy legislation

Right now, Congress is considering a new federal privacy law, but nearly all of the proposals on the table have ignored the crucial issue of forced-arbitration clauses in consumer contracts. Companies use these clauses to prevent customers from suing them, often leaving no practical options for consumers whose rights have been violated.  Arbitration clauses are especially harmful when it comes to the Internet, because almost everything we do online involves a contract. Nobody is going to hire a lawyer to dispute a wrongfully added charge of $5 or $6 on their monthly Internet bill; combining many such claims is often the only feasible way for private citizens to enforce their legal rights. When that route is not available, many potential claims will just never be made. Any new privacy law should include a “private right of action,” meaning a provision that allows individuals to sue someone who violates their rights under the law. If Congress doesn’t do something about arbitration clauses, it will be hard to enforce any new protections.

[Daniel Wilf-Townsend is a lawyer in Washington (DC) who focuses on consumer protection and constitutional litigation at Gupta Wessler PLLC.]