FTC Issues Notice Contemplating Rulemaking For Security, Privacy And AI In 2022

CPW has been tracking Federal Trade Commission ("FTC") activity in the realm of privacy and cybersecurity in 2021.  Last Friday, the FTC issued a notice ("Notice") that it was "considering initiating a rulemaking under Section 18 of the FTC Act to curb lax security practices, limit privacy abuses, and ensure that algorithmic decision-making does not result in unlawful discrimination."  Although unsurprising, this development is extremely significant and posed to reshape the regulatory landscape going forward.

By way of reference, under Section 18 of the FTC Act, 15 U.S.C. Section 57a (also referred to as the Magnuson-Moss Warrant Act ("MMWA")), the FTC is authorized to prescribe "rules which define with specificity acts or practices which are unfair or deceptive acts or practices in or affecting commerce" as described within Section 5(a)(1) of the Act.  Among other things, the statute requires that the FTC's rulemaking proceedings provide an opportunity for