Courts, Regulators Should Limit Excessive Privacy Penalties

By Doug Meal, David Cohen and Adrienne Tierney (October 28, 2020, 5:51 PM EDT) -- The potential financial consequences for running afoul of privacy and cybersecurity legal requirements are on the rise. Legislatures continue to pass privacy and cybersecurity statutes imposing onerous remedies, and regulators are taking an increasingly expansive view of their remedial authority under laws that are already on the books.

A recent Federal Trade Commission settlement highlights one of the most important examples of this trend, namely, the increasing threat of civil penalties. In U.S. v. HyperBeard Inc., the FTC imposed a $4 million penalty on a company that allegedly violated the Children's Online Privacy Protection Act by allowing third-party advertising networks to...

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