Victory! North Carolina Settles ACLU/Amazon Privacy Case

We’re thrilled to announce a win for privacy! The North Carolina Department of Revenue (NCDOR) has agreed to stop asking for personally identifiable customer information in combination with details about the titles of customers’ purchases from Internet retailers. The agreement came in the settlement of a lawsuit originally brought by Amazon.com to stop NCDOR from collecting such information. The ACLU and its affiliates in North Carolina and Washington state (where Amazon is headquartered) intervened in the lawsuit on behalf of several Amazon customers whose private information was at stake.

Last year, we told you about Amazon.com’s lawsuit against the NCDOR for demanding the private records of its customers. The Revenue Department had demanded that Amazon hand over individually identifiable information that could be linked to specific purchases made on the site. They said they wanted this information to ensure that Amazon was in full compliance with the state’s sales and use tax laws.

If they just want the information for tax purposes, you would think the monetary value of the purchases would suffice. But that’s not all the requests asked for. Amazon responded by providing its product codes, which detail the titles of the books or movies its customers purchased, but rightly withheld customer information that would link the purchases to specific customers.

Why does the DOR need to know who bought what?

The ACLU first got involved last May by sending a letter to the then-Secretary of NCDOR, Kenneth Lay, informing him that demanding this kind of personal information was a violation of North Carolinians’ First Amendment rights to purchase and read lawful materials of their choice. Lay and the NCDOR didn’t back down from the demand, so in June, the ACLU intervened in Amazon’s lawsuit on behalf of seven anonymous Amazon.com customers. We argued this point before a federal court in Seattle last October, and later that month, the court agreed that the government has no right to obtain titles together with customer information.

This settlement is a great win for privacy. While the court’s ruling concerned only the specific request issued to Amazon, the settlement covers requests to all Internet retailers who sell books, movies, music, and similar expressive materials. North Carolina has apparently issued similar requests to other Internet retailers, and previously indicated that it planned to issue more such requests in the future. We are pleased that North Carolina has agreed to take a new approach. Requesting information about what people are purchasing online causes real harm, to real people, and it is unconstitutional in these circumstances.

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