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From A to ZIP Codes, and Beyond
An ever-increasing number of companies find themselves facing potential liability for practices concerning the use, collection, or release of consumer data. The courts are rife with class-action litigation by individuals seeking compensation in the wake of stolen or lost laptops, hacked computer networks, or data stolen through phishing scams, even in cases where the plaintiffs have not suffered any actual misuse of their own data. Recent legal developments have helped to limit the viability of these cases. Perhaps the most prominent development is the U.S. Supreme Court's recent decision in Clapper v. Amnesty Int'l USA, 133 S. Ct. 1138 (2013), in which the Court made clear that plaintiffs cannot establish standing to sue based on a mere risk of future injury, and plaintiffs may not manufacture standing by taking steps to prevent the risk of future injury.
Collecting ZIP Codes
Despite ' and perhaps because of ' this and other positive developments, new and increasingly creative fronts in data privacy litigation and enforcement are constantly being opened. One such evolving area of potential liability impacts companies that collect ZIP code information from consumers during routine retail transactions. Many companies request and collect a customer's ZIP code at the time of a retail transaction, and they do so for various purposes: some may need the information for delivery of the purchased product; some may wish to enroll the customer in some type of rewards or other store benefits program; some may use the information to send marketing materials to the customer; and some may sell the information to third parties. Although there are many legitimate purposes for collecting ZIP code information, this practice has now borne significant scrutiny.
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