RadioShack's Trustee Fights For Customer Privacy

In the midst RadioShack’s bankruptcy, previous consumers can feel safe that customer privacy is being held in high regard by the federal bankruptcy court.

The trustee assigned to RadioShack’s bankruptcy recently implored a federal court to protect customer privacy by ensuring that the electronics retailer cannot sell its customer data amid its plans to wind down and keep certain stores operational.

Andrew Vara, the acting trustee, is certainly not alone in his objections, as the Attorneys General of several states have questioned whether RadioShack even has the right to sell the aforementioned information without violating its own privacy policies.

Texas Attorney General Ken Paxton has repeatedly spoken out against the electronics retailer selling this data, originally filing an objection to this sale in March, according to Law360. When filing this objection, he argued that allowing the company to sell this wealth of information – which includes data on close to 40 percent of the U.S. population – would violate the consumer protection laws of several states and breach RadioShack’s privacy policies.

On April 16, Paxton once again implored the federal judge handling the case to deny the company’s request to sell its consumer data, reiterating that Texas – along with 35 other states – has warned that allowing such a transaction would breach costumer privacy rights, Law360 reported. In addition, he stated that the electronics retailer has failed to shed light on exactly which personal information would be included in the sale.

Lack of Clarity

Because RadioShack has not specified key matters, including the number of consumers whose data would be involved in the sale, Vara said that court-appointed privacy ombudsman Elise Frejka has been unable to perform her duties, and the federal court has not been able to consider alternatives that help reduce consumer privacy losses if the sale does indeed finalize, according to Law360.

While any such transaction could involve selling the information of as many as 117 million customers, RadioShack previously estimated only 67 million of these files have any value, the media outlet reported. Paxton has sought additional clarity, requesting April 16 that the court order RadioShack to specify the exact information it wants to sell, how many customers such a move would affect and whether the data came from in-store or online purchases.

In addition, Paxton’s office has argued that RadioShack should not be allowed to link its consumer data to other assets it wants to sell, stating that doing so would make the value of the information ambiguous, according to the news source.