I
106TH CONGRESS
2D SESSION
H. R. 5430
To require the Federal Trade Commission to prescribe regulations to protect
the privacy of personal information collected from and about individuals
on the Internet, to provide greater individual control over the collection
and use of that information, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 10, 2000
Mr. GREEN of Texas introduced the following bill; which was referred to the
Committee on Commerce
A BILL
To require the Federal Trade Commission to prescribe regu-
lations to protect the privacy of personal information
collected from and about individuals on the Internet,
to provide greater individual control over the collection
and use of that information, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Consumer Online Pri-
vacy and Disclosure Act’’.
SEC. 2. REGULATION OF UNFAIR AND DECEPTIVE ACTS
AND PRACTICES IN CONNECTION WITH THE
COLLECTION, USE, AND DISCLOSURE OF PER-
SONAL INFORMATION.
(a) ACTS PROHIBITED.—
(1) IN GENERAL.—Except as provided in para-
graph (2), it is unlawful for an operator of a Web
site or online service to collect, use, or disclose per-
sonal information in a manner that violates the reg-
ulations prescribed under subsection (b).
(2) DISCLOSURE.—Notwithstanding paragraph
(1), neither an operator of a Web site or online serv-
ice nor the operator’s agent shall be held liable
under this Act for any disclosure made in good faith
and following reasonable procedures in responding to
a request under subsection (b)(1)(B) by an indi-
vidual for disclosure of personal information per-
taining to such individual.
(3) CROSS TABULATION OF INTERNET DATA.—
Unless there is a pre-existing business relationship,
no Web site or ISP may correlate IPS address infor-
mation with personal information.
(b) REGULATIONS.—
(1) IN GENERAL.—Not later than 1 year after
the date of the enactment of this Act, the Commis-
sion shall promulgate under section 553 of title 5,
United States Code, regulations that—
(A) require the operator of any Web site or
online service—
(i) to provide notice on its Web site in
a format that the average person can un-
derstand which notice shall be clear and
conspicuous and shall provide the identity
of the operator, the physical and electronic
mail address of the operator, what per-
sonal information is collected by the oper-
ator, how the operator uses such informa-
tion, and what information may be shared
or sold with other companies;
(ii) to provide a meaningful and sim-
ple online process for individuals to opt-out
the disclosure of personal information for
purposes unrelated to those for which such
information was obtained or described in
the notice under clause (i); and
(iii) to provide a description of the
specific types of personal information col-
lected by that operator that is either sold,
shared, or transferred to an external com-
pany or third party.
(2) WHEN
PURPOSE
LIMITATION
NOT
RE-
QUIRED.—The regulations shall provide that the un-
related purpose limitation required under paragraph
(1)(A)(ii) is not required for—
(A) transactional information where per-
sonal information is not removed;
(B) personal information where it is used
to render or conduct a business activity related
to the business of the operator (for example,
the use of an e-mail address to respond to an
e-mail communication); or
(C) the collection, use, or dissemination of
such information by the operator of such a Web
site or online service necessary to the extent re-
quired under other provisions of law.
(c) ENFORCEMENT.—Subject to this section and sec-
tion 4, a violation of a regulation prescribed under sub-
section (a) shall be treated as a violation of a rule defining
an unfair or deceptive act or practice prescribed under sec-
tion 18(a)(1)(B) of the Federal Trade Commission Act
(15 U.S.C. 57a(a)(1)(B)).
(d) NO REQUIREMENT TO COLLECT OR MAINTAIN
DATA.—Nothing in this Act shall be interpreted to require
an operator to collect or maintain any data that would
not otherwise be collected or maintained.
SEC. 3. ACTIONS BY STATES.
(a) IN GENERAL.—
(1) CIVIL ACTIONS.—In any case in which the
attorney general of a State has reason to believe
that an interest of the residents of that State has
been or is threatened or adversely affected by the
engagement of any person in a practice that violates
any regulation of the Commission prescribed under
section 2, the State may bring a civil action on be-
half of the residents of the State in a district court
of the United States of appropriate jurisdiction to—
(A) enjoin that practice;
(B) enforce compliance with the regulation;
(C) obtain damage, restitution, or other
compensation on behalf of residents of the
State; or
(D) obtain such other relief as the court
may consider to be appropriate.
(2) NOTICE.—
(A) IN GENERAL.—Before filing an action
under paragraph (1), the attorney general of
the State involved shall provide to the
Commission—
(i) written notice of that action; and
(ii) a copy of the complaint for that
action.
(B) EXEMPTION.—
(i) IN GENERAL.—Subparagraph (A)
shall not apply with respect to the filing of
an action by an attorney general of a State
under this subsection, if the attorney gen-
eral determines that it is not feasible to
provide the notice described in that sub-
paragraph before the filing of the action.
(ii) NOTIFICATION.—In an action de-
scribed in clause (i), the attorney general
of a State shall provide notice and a copy
of the complaint to the Commission at the
same time as the attorney general files the
action.
(b) INTERVENTION.—
(1) IN GENERAL.—On receiving notice under
subsection (a)(2), the Commission shall have the
right to intervene in the action that is the subject
of the notice.
(2) EFFECT OF INTERVENTION.—If the Com-
mission intervenes in an action under subsection (a),
it shall have the right—
(A) to be heard with respect to any matter
that arises in that action; and
(B) to file a petition for appeal.
(3) AMICUS CURIAE.—Upon application to the
court, a person whose self-regulatory guidelines have
been approved by the Commission and are relied
upon as a defense by any defendant to a proceeding
under this section may file amicus curiae in that
proceeding.
(c) CONSTRUCTION.—For purposes of bringing any
civil action under subsection (a), nothing in this Act shall
be construed to prevent an attorney general of a State
from exercising the powers conferred on the attorney gen-
eral by the laws of that State to—
(1) conduct investigations;
(2) administer oaths or affirmations; or
(3) compel the attendance of witnesses or the
production of documentary and other evidence.
(d) VENUE; SERVICE OF PROCESS.—
(1) VENUE.—Any action brought under sub-
section (a) may be brought in the district court of
the United States that meets applicable require-
ments relating to venue under section 1391 of title
28, United States Code.
(2) SERVICE
OF
PROCESS.—In an action
brought under subsection (a), process may be served
in any district in which the defendant—
(A) is an inhabitant; or
(B) may be found.
SEC. 4. ADMINISTRATION AND APPLICABILITY OF ACT.
(a) IN GENERAL.—Except as otherwise provided, this
Act shall be enforced by the Commission under the Fed-
eral Trade Commission Act (15 U.S.C. 41 et seq.).
(b) PROVISIONS.—Compliance with the requirements
imposed under this Act shall be enforced under—
(1) section 8 of the Federal Deposit Insurance
Act (12 U.S.C. 1818), in the case of—
(A) national banks, and Federal branches
and Federal agencies of foreign banks, by the
Office of the Comptroller of the Currency;
(B) member banks of the Federal Reserve
System (other than national banks), branches
and agencies of foreign banks (other than Fed-
eral branches, Federal agencies, and insured
State branches of foreign banks), commercial
lending companies owned or controlled by for-
eign banks, and organizations operating under
section 25 or 25(a) of the Federal Reserve Act
(12 U.S.C. 601 et seq. and 611 et seq.), by the
Board; and
(C) banks insured by the Federal Deposit
Insurance Corporation (other than members of
the Federal Reserve System) and insured State
branches of foreign banks, by the Board of Di-
rectors of the Federal Deposit Insurance Cor-
poration;
(2) section 8 of the Federal Deposit Insurance
Act (12 U.S.C. 1818), by the Director of the Office
of Thrift Supervision, in the case of a savings asso-
ciation the deposits of which are insured by the Fed-
eral Deposit Insurance Corporation;
(3) the Federal Credit Union Act (12 U.S.C.
1751 et seq.) by the National Credit Union Adminis-
tration Board with respect to any Federal credit
union;
(4) part A of subtitle VII of title 49, United
States Code, by the Secretary of Transportation
with respect to any air carrier or foreign air carrier
subject to that part;
(5) the Packers and Stockyards Act, 1921 (7
U.S.C. 181 et seq.) (except as provided in section
406 of that Act (7 U.S.C. 226, 227)), by the Sec-
retary of Agriculture with respect to any activities
subject to that Act; and
(6) the Farm Credit Act of 1971 (12 U.S.C.
2001 et seq.) by the Farm Credit Administration
with respect to any Federal land bank, Federal land
bank association, Federal intermediate credit bank,
or production credit association.
(c) EXERCISE OF CERTAIN POWERS.—For the pur-
pose of the exercise by any agency referred to in sub-
section (b) of its powers under any other Act referred to
in that subsection, a violation of any requirement imposed
under this Act shall be deemed to be a violation of a re-
quirement imposed under that other Act. In addition to
its powers under any provision of law specifically referred
to in subsection (b), each of the agencies referred to in
that subsection may exercise, for the purpose of enforcing
compliance with any requirement imposed under this Act,
any other authority conferred on such agency by law.
(d) ACTIONS BY THE COMMISSION.—The Commis-
sion shall prevent any person from violating a rule of the
Commission under section 2 in the same manner, by the
same means, and with the same jurisdiction, powers, and
duties as though all applicable terms and provisions of the
Federal Trade Commission Act (15 U.S.C. 41 et seq.)
were incorporated into and made a part of this Act. Any
entity that violates such rule shall be subject to the pen-
alties and entitled to the privileges and immunities pro-
vided in the Federal Trade Commission Act in the same
manner, by the same means, and with the same jurisdic-
tion, power, and duties as though all applicable terms and
provisions of the Federal Trade Commission Act were in-
corporated into and made a part of this Act.
(e) EFFECT ON OTHER LAWS.—Nothing contained in
this Act shall be construed to limit the authority of the
Commission under any other provisions of law.
SEC. 5. REVIEW.
Not later than 2 years after the effective date of the
regulations initially issued under section 2, the Commis-
sion shall—
(1) review the implementation of this Act, in-
cluding the effect of the implementation of this Act
on practices relating to the collection and disclosure
of information; and
(2) prepare and submit to Congress a report on
the results of the review under paragraph (1).
SEC. 6. STUDY.
The Comptroller General of the United States shall
conduct a study of the implementation of this Act during
the first 2 years after the date of its enactment and shall
report the results of such study to Congress.
SEC. 7. EFFECTIVE DATE.
Sections 2(a), 4, and 5 of this Act shall take effect
on the later of—
(1) the date that is 18 months after the date
of enactment of this Act; or
(2) the date on which the Commission rules on
the first application filed for safe harbor treatment
under section 2 if the Commission does not rule on
the first such application within one year after the
date of enactment of this Act, but in no case later
than the date that is 30 months after the date of
enactment of this Act.
SEC. 8. DEFINITIONS.
In this Act:
(1) INDIVIDUAL.—The term ‘‘individual’’ means
a natural person of age 13 and above.
(2) COMMISSION.—The term ‘‘Commission’’
means the Federal Trade Commission.
(3) 
DISCLOSURE.—The 
term 
‘‘disclosure’’
means, with respect to personal information the re-
lease of personal information collected in identifiable
form by an operator for any purpose, except where
such information is provided to a person other than
the operator who provides support for the internal
operations of the Web site and does not disclose or
use that information for any other purpose.
(4) FEDERAL
AGENCY.—The term ‘‘Federal
agency’’ means an agency, as that term is defined
in section 551(1) of title 5, United States Code.
(5) INTERNET.—The term ‘‘Internet’’ means
collectively the myriad of computer and tele-
communications facilities, including equipment and
operating software, which comprise the inter-
connected world-wide network of networks that em-
ploy the Transmission Control Protocol/Internet
Protocol, or any predecessor or successor protocols
to such protocol, to communicate information of all
kinds by wire or radio.
(6) OPERATOR.—The term ‘‘operator’’—
(A) means any person who operates a Web
site located on the Internet or an online service
and who collects or maintains personal informa-
tion from or about the users of or visitors to
such Web site or online service, or on whose be-
half such information is collected or main-
tained, where such Web site or online service is
operated for commercial purposes, including
any person offering products or services for sale
through that Web site or online service, involv-
ing commerce—
(i) among the several States or with 1
or more foreign nations;
(ii) in any territory of the United
States or in the District of Columbia, or
between any such territory and—
(I) another such territory; or
(II) any State or foreign nation;
or
(iii) between the District of Columbia
and any State, territory, or foreign nation;
but
(B) does not include any nonprofit entity
that would otherwise be exempt from coverage
under section 5 of the Federal Trade Commis-
sion Act (15 U.S.C. 45).
(7) PERSONAL INFORMATION.—The term ‘‘per-
sonal information’’ means information collected on-
line from an individual that identifies that indi-
vidual, including—
(A) first and last name;
(B) home and other physical address;
(C) e-mail address;
(D) social security number;
(E) telephone number;
(F) any other identifier that the Commis-
sion determines identifies an individual; or
(G) information that is maintained with, or
can be searched or retrieved by means of, data
described in subparagraphs (A) through (F).
(8) PRE-EXISTING BUSINESS RELATIONSHIP.—
The term ‘‘pre-existing relationship’’ means, when
used with respect to an individual and operator of
a Web site, that either of the following communica-
tions exist:
(A) Within a 5-year period there has been
a business transaction between the individual
and the operator (including a transaction in-
volving the provision, free of charge, of informa-
tion requested by the recipient of goods or serv-
ices).
(B) The individual was at the time of a
business transaction or thereafter, provided a
clear and conspicuous notice of an operators
data collection practices and has not exercised
their opportunity to terminate the pending
transaction.
(9) TRANSACTIONAL INFORMATION.—The term
‘‘transactional information’’ means information gen-
erated in connection with the process of requesting,
accessing, or otherwise using the Internet.
SEC. 9. PRIVATE RIGHT OF ACTION.
(a) ACTIONS AUTHORIZED.—Any person or entity
may, if otherwise permitted by the laws or rules of court
of a State, bring in an appropriate court of that State,
or may bring in an appropriate Federal court if such laws
or rules do not so permit, either or both of the following
actions:
(1) An action based on a violation of any rule
promulgated under section 2 to enjoin such viola-
tion.
(2) An action to recover for actual monetary
loss from such a violation in an amount equal to the
greatest of—
(A) the amount of such actual monetary
loss; or
(B) $1,000 for each such violation, not to
exceed a total of $50,000.
(b) ADDITIONAL REMEDIES.—If the court finds that
the defendant willfully, knowingly, or repeatedly violated
a rule promulgated under section 2, the court may, in its
discretion, increase the amount of the award to an amount
equal to not more than three times the amount available
under subsection (a)(2).
(c) ATTORNEY FEES.—In any such action, the court
may, in its discretion, require an undertaking for the pay-
ment of the costs of such action, and assess reasonable
costs, including reasonable attorneys’ fees, against any
party.
(d) PROTECTION OF TRADE SECRETS.—At the re-
quest of any party to an action brought pursuant to this
section or any other participant in such an action, the
court may, in its discretion, issue protective orders and
conduct legal proceedings in such a way as to protect the
secrecy and security of the computer, computer network,
computer data, computer program, and computer software
involved in order to prevent possible recurrence of the
same or a similar act by another person and to protect
any trade secrets of any such party or participant.
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