FTC Plants A Flag With LabMD Ruling: What This Means For Enforcement

On Friday, the heads of the Federal Trade Commission overruled the decision of the Administrative Law Judge ("ALJ") in In the Matter of LabMd., Inc. The FTC concluded that the ALJ had erred in dismissing the Commission's case against a lab testing company LabMD and misapplied the unfairness standard.  The key determination by the FTC was that the mere disclosure of sensitive medical information is cognizable harm under Section 5(c) of the FTC Act, 15 U.S.C. § 45(a), irrespective of whether there is further economic or physical harm.   What does this mean for privacy enforcement?   Read on.

The LabMD History

As we wrote previously, this case originated in 2013.  LabMD, a testing laboratory, was alleged to have failed to protect sensitive consumer information.  Namely, between 2001 and 2014, LabMD collected and electronically stored sensitive medical information of 750,000 consumers from physicians, including many consumers for whom it never performed any