By Carl Wedoff (Jenner & Block), David P. Saunders (Jenner & Block)
For as long as there have been consumer businesses, they have collected consumer data. But in recent years, the volume and value of consumer data collection has increased exponentially, becoming a multibillion-dollar industry of its own. At the same time, consumer privacy laws are on the rise at the state level and are under consideration at the federal level. The value of data can create substantial friction for a business with respect to maintaining consumer interests and complying with privacy laws and regulations while maximizing the usefulness of consumer data to the business itself.
Bankruptcy courts routinely deal with the sale of consumer data, often in retail bankruptcies, but to date, “big data” issues have rarely, if ever, surfaced. However, this could change with the anticipated surge of corporate bankruptcy resulting from the recent COVID-19 pandemic.
As a result, bankruptcy judges and “consumer privacy ombudsmen,” or CPOs, need to evaluate more now than ever whether the transfer of consumer data is both permissible and in the best interests of all parties involved, including the consumers to whom the information relates.
This article explores the current framework for the sale of consumer data in bankruptcies and the potential changes in how bankruptcy courts may approach consumer data privacy issues in the future.
The full article can be found here.