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Hearst Communications has agreed to pay $50 million to settle a lawsuit in which it was accused of selling its magazine subscribers’ subscription histories, reading habits, age, race, religion, charitable donations, political affiliations, income bracket, shopping habits and other personal data to third parties, including data-mining companies without their consent. The settlement comes after the New York-based media giant, which owns Harper’s Bazaar, Elle, Cosmo, Marie Claire, Good Housekeeping, and Esquire, among an array of other titles, was sued in November 2015 in a New York federal court by Good Housekeeping subscriber Josephine James Edwards.
Michigan-based Edwards alleged that Hearst illegally granted third party “data mining” companies to access Hearst’s database of subscriber information without the permission of subscribers in violation of the Michigan state Video Rental Privacy Act. According to the class action suit that Edwards filed, Michigan’s Video Rental Privacy Act prohibits the sharing of personal information provided by consumers about their purchasing, renting or borrowing of materials that might provide details about their identity and interests without consent from the individual consumers.
“Hearst’s subscribers are completely unaware that Hearst is selling their personal information on the open market,” Edwards asserted in her complaint. This is because, she claimed, “Hearst does not obtain consent prior to selling the intimate personal data,” thereby resulting in Hearst’s subscribers being “bombarded with personalized advertisements, junk-mail, and in some instances scams by mail and phone.”
Edwards says that between 2013 and 2014 when she was subscribed to Good Housekeeping, she received an excess amount of flyers, advertisements, and junk mail, along with unwanted telephone calls because Hearst sold her information to data mining companies and sold mailing lists containing her personal data to companies seeking to contact Hearst subscribers.
The $50 million settlement – which is three times bigger the largest-ever settlement reached over alleged violations of the Michigan state statute, surpassing the April $16.38 million settlement from Consumer Reports, which was sued by a class of readers who also believed their subscription data had been sold without their consent – came about following mediation between Edwards and Hearst last month.
It follows from a handful of similar lawsuits filed in Michigan including one that is currently underway against Time and Fast Company’s publisher parent, Mansueto Ventures, as well as cases that have settled for between $4.5 million and $7.5 million involving Rodale, which owns Women’s Health and Runner’s World, and Entertainment Weekly and People’s parent company, Meredith, respectively.
A representative for Hearst did not respond to a request for comment.
* The case is Edwards v. Hearst Communications, 1:15-cv-09279 (SDNY).
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