Netflix settles lawsuit with former customers

Netflix revealed a little bit of bad news late on Friday. In a filing with the US Securities and Exchange Commission, the streaming video company announced that it would be making a change in its previously announced fourth quarter 2012 financial results. Netflix said it would be taking an additional $9 million change due to a settlement that Netflix made "related to our compliance with the Video Privacy Protection Act."

Paidcontent.org reports that the settlement is due to a lawsuit filed in 2011 filed by a number of former customers. Those subscribers stated that when they decided to rejoin Netflix, they discovered that Netflix continued to store their personal information even after they left the service. According to the Video Privacy Protection Act, companies that rent videos must destroy personal information within a year after the subscriber leaves the service.

In an official statement, Netflix said they decided to settle the lawsuit "with no admission of wrongdoing." It added that the lawsuit was unrelated to Netflix's current issue with the Video Privacy Protection Act which currently prevents Netflix from letting its customers share their Netflix viewing habits with their Facebook friends. Netflix does have this feature in a number of other countries and is trying to get the VPPA changed in the US Congress to allow its US customers to access the same feature.

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