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FTC v. Toysmart.com

Federal Trade Commission

Civ. Action No. 00-11341-RGS (2000)

Facts

The Federal Trade Commission (FTC) (plaintiff) instituted an administrative complaint against Toysmart.com (Toysmart) (defendant), alleging that Toysmart had violated the Federal Trade Commission Act (the FTC Act). The FTC asserted that Toysmart’s privacy policy had stated the company would never share its customers’ and website registrants’ personal information with third parties. The FTC alleged the following. (1) In May 2000, Toysmart ceased operations and began seeking bids to buy its assets. (2) In June 2000, Toysmart’s creditors filed to force Toysmart into involuntary bankruptcy. (3) Toysmart’s customer lists, which contained its customers’ personal information, were included in Toysmart’s listed assets for sale. The FTC claimed that Toysmart’s inclusion of its customer lists constituted a dissemination of its customers’ personal information, contrary to Toysmart’s privacy policy.

Rule of Law

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Issue

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Holding and Reasoning

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Dissent (Swindle, Comm’r)

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Dissent (Anthony, Comm’r)

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