Can Customer Information Be Sold? Carefully, Very Carefully

The Radio Shack bankruptcy case raised a fundamental question regarding the sale of personally identifiable customer information: Can it be done? The answer is "Probably". (You expected anything else?)

When Radio Shack filed for bankruptcy protection, it had collected personally identifiable customer information respecting 117 million individual customers. Radio Shack had promised customers in its privacy policy that it would not "rent or sell" their personally identifiable information to any third party. In the bankruptcy proceedings, the customer information was identified as an asset. Radio Shack proposed to sell this asset for the benefit of creditors. The FTC, many state attorneys general, Verizon and AT&T objected to the proposed sale. A privacy ombudsman, permitted by the Bankruptcy Code, was also appointed by the Court.