Buying Personal Information in Bulk: Not So Fast!

An attempt by a Canadian online dating service, Plenty of Fish, to buy the database of a bankrupt competitor has run aground on privacy considerations (in Texas, of all places).

This has echoes of a situation a decade ago where the database of a toy company was going to be acquired. My recollection (subject to correction by Slaw readers) is that the purchase was derailed by public outcry more than by operation of law.

How would you go about making sure that your clients’ databases of personal information are saleable assets – or can this be done in Canada (or the US)? Should businesses be able to do this? Or is personal information sort of like an Apple Store app or iTunes music – acquired only for the acquirer during its (corporate) lifetime and expiring without value at the end of that life?

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  1. The earlier case I had in mind was Toysmart – where Toysmart, insolvent, wanted to sell its customers’ personal information. The Federal Trade Commission objected but after negotiation, agreed to a disposition with protections. However, the bankruptcy court disagreed, and no sale was made. Here is a report on this and a similar case.