Most FTC watchers know that the new Commission Chair, Lina Khan, is an antitrust activist. Less well known, but not surprising, is Kahn is likely to also be a privacy hawk.
As reported recently by Politico,
In December 2019, a Columbia Law School fellow named Lina Khan co-authored an article in the Harvard Law Review comparing social media executives to used-car salesmen.
In it, Khan and her co-author, Columbia Law professor David Pozen, dismissed as “implausible” the idea that a company like Facebook or Google, which makes its money from personalized ads, could ever truly put its users’ privacy first.
‘As long as such companies make most of their money through personally targeted advertisements, they will be economically motivated to extract as much data from their users as they can,’ they wrote, ‘a motivation that runs headfirst into users’ privacy interests as well as any interests users might have in exercising behavioral autonomy or ensuring that their personal data is not stolen, sold, mined, or otherwise monetized down the line.’
The article was a full-throated condemnation of the very business model that dominates the web and a call for regulation that would actually force tech companies to protect users’ privacy. “By and large, addictive user behavior is good for business. Divisive and inflammatory content is good for business. Deterioration of privacy and confidentiality norms is good for business,” the article reads.
The Politico story continues,
[Khan’s] 2019 article grapples with an increasingly popular concept in privacy law that proposes turning tech companies into ‘information fiduciaries.’ Just as these companies have a fiduciary duty to maximize profits for their shareholders, the thinking goes, they could also be required to be fiduciaries — which is to say, legally-bound stewards — of user data.
. . .
The article goes so far as to liken abuse of user data to environmental pollution and calls for “clear prohibitions and economic disincentives, rather than morally laden standards” to deal with that pollution. The question now is what Khan can do about any of that as chair.
Former acting FTC chair, and still commissioner, Rebecca Slaughter, has been outspoken in her desire to create a more muscular FTC to go after companies that threaten the privacy of American consumers. When she was acting chair, before Khan, Slaughter said that “I believe that we can and must use our rule-making authority to deliver effective deterrence for the novel harms of the digital economy and persistent old scams alike.”
Again, Politico wrote that
Slaughter and Khan also have some overlap in how they see the connection between competition and privacy, two issues that the FTC has authority over, but which are often handled along different tracks. Khan and Pozen clearly considered this dynamic in their article on online ads, writing that ‘antitrust lawsuits reversing key acquisitions and penalizing forms of monopoly’ are one possible remedy.
Hard power, like enforcement and regulation, is one tool that the FTC has, but there is also the soft power of a megaphone.
Ultimately, though, one of the biggest tools Khan will have as chair is the power to use the bully pulpit to communicate these concerns both to Congress and to industry. Slaughter used her limited time as acting chair to ask Congress for additional funding and authority for the FTC and to issue a warning to tech companies that selling or using biased AI could violate the agency’s prohibition on deceptive or misleading practices. As chair, Khan could issue much the same sort of guidance on deceptive data practices and send a message about how the FTC plans to pursue such cases in the future.
Eric J. Ellman is Senior Vice President for Public Policy and Legal Affairs at the Consumer Data Industry Association (CDIA) in Washington, DC. He also served for eight months as Interim President and CEO of the Association. More