Will Netflix Have To Pay?

It seems that Netflix had a contest in which some 50,000 contestants were provided with two sets of data information. The contest was to help Netflix better understand their clients recommendations and to improve by at least 10% what Netflix was already doing. Two of the contestants were able to compare the sets of data, what the users rented, and the comments they made. By putting two and two together one woman claims she was outed as a lesbian by name.

In a recent article it also states that:

Thursday’s suit argues that the information is personal data protected by Netflix’s privacy policy, and that NetFlix should have known that people would be able to identify users based on that data alone. In fact, just two months before NetFlix launched the contest, AOL released “anonymized” search-engine logs, which reporters quickly used to track down real people.

So it wasn’t surprising that just weeks after the contest began, two University of Texas researchers — Arvind Narayanan and Vitaly Shmatikov — identified several NetFlix users by comparing their “anonymous” reviews in the Netflix data to ones posted on the Internet Movie Database website. Revelations included identifying their political leanings and sexual orientation.

The complaint calls that the Brokeback Mountain factor, arguing that marketers will suck up the data, combine it with other data sets and start pigeon-holing people into marketing categories, based on assumptions about the movies they rated.

The lawsuit is asking that all 2 million Netflix users be awarded $2,500 each.

It should be interesting to see exactly what happens with this lawsuit. As a Netflix user I have a vested interest in the final outcome of the lawsuit and any award that may be issued.

But what do you think? Should Netflix be held liable for letting this information be released?

Comments welcome.