Costco faces two proposed federal class action lawsuits alleging the unlawful sharing of sensitive health information with third parties. The lawsuits, filed in Washington federal court, claim that Costco’s data collection and sharing practices violate HIPAA, the Federal Trade Act, and various federal and state wiretapping laws.
Furthermore, the allegations suggest that hundreds of thousands or possibly over one million people may have been affected by Costco’s data practices. The lawsuits seek financial damages and an injunction for Costco to address the alleged harm caused by their actions.
Government warnings from the U.S. Department of Health and Human Services have emphasized the need for HIPAA-regulated entities to obtain patient consent before transmitting personally identifying information to third parties. The lawsuits claim that Costco failed to inform website users that their data was being shared with third parties, including social media networks and online advertisers like Facebook. The lawsuits highlight the importance of protecting sensitive health information in compliance with HIPAA and FTC regulations.
The legal action against Costco is part of a broader trend involving lawsuits against entities that allegedly use online trackers to collect and share sensitive health and personal information without user consent. Entities such as Meta and Google have also been named as defendants in similar lawsuits. The litigation underscores the growing scrutiny of data privacy practices and the need for companies to review their data collection, consent language, and the level of anonymization of the data they collect from their websites.