TRUSTe Applauds Proposed Toysmart.com Settlement

January 9, 2001 – TRUSTe applauds the proposed settlement reached in the Toysmart.com bankruptcy case. Under the terms of the settlement, a subsidiary of Disney will purchase Toysmart.com's customer database for $50,000. The database will not be transferred to a third party, but will be immediately destroyed by Toysmart.com. No customer information will be transferred, shared, or sold as part of the agreement.

In July 2000, TRUSTe alerted the Web community about Toysmart.com's intention to sell its customers' personal information. After forwarding the case to the Federal Trade Commission (FTC) as a potential violation of the FTC's prohibition against unfair and deceptive practices, TRUSTe was joined by the FTC and more than 40 state attorneys general in opposing the data sale in court.

"The settlement reached today is a victory for consumer privacy, an example of the effectiveness of self-regulation, and proof of TRUSTe's strength in ensuring that privacy promises are kept," said Bob Lewin, President and CEO of TRUSTe. "This action sends a strong message to consumers online: TRUSTe will fight to make sure you have control of your personal information to protect your privacy."

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Wiley Rein LLP