• by Wendy Davis  @wendyndavis, May 18, 2012

Consumers who sued Hulu for alleged privacy violations are urging a federal judge to reject the company's argument that it isn't covered by the federal video privacy law.

Hulu's contention that the Video Privacy Protection Act only applies to brick-and-mortar stores is "disingenuous at best," the consumers argue in a 19-page reply filed last week with the U.S. District Court in the Northern District of California.

They say that Hulu's bid to distinguish streaming videos from DVDs or videocassettes is "akin to the argument that an email is not a document because it exists exclusively in cyberspace."

The lawsuit was sent to mediation earlier this week, but that doesn't necessarily signal that it will be resolved; many cases in federal court are referred to dispute resolution programs but then return to court if the parties aren't able to come to an agreement.

The litigation dates to last year, when consumers alleged that Hulu violated their privacy by working with the analytics company KISSmetrics, which used "supercookies" to track people. KISSmetrics reportedly used ETag technology to track people even when they deleted their cookies. ETags store information in users' browser caches, so that even when users erase their cookies, the information contained in them can be recreated.

Hulu allegedly used these persistent supercookies to retain data about videos watched, and also allegedly transmitted that information to outside companies like market research firmScoreCard Research, social networking service Facebook, Google's DoubleClick and Quantcast.

The Web users argue that Hulu violated the federal Video Privacy Protection Act, which prohibits companies that rent or sell videos from disclosing consumers' personally identifiable information without their written consent. They originally also claimed that Hulu violated the federal computer fraud law and various California laws, but dropped those claims earlier this week.

Congress passed the Video Privacy Protection Act in 1988, after a newspaper in Washington obtained and published the video rental records of Supreme Court nominee Robert Bork.

The statute itself says it applies to "video tape service providers,” which it defines as companies that deliver "prerecorded video cassette tapes or similar audio visual materials." Hulu asked for the case to be dismissed, arguing that it didn't fall within the definition of video tape service provider. But the consumers argue in their most recent filing that the law is broad enough to cover companies engaged in online video streaming.

Hulu also argued that the case should be thrown out because the consumers weren't harmed by any disclosures. The consumers countered that the statute provides for damages of $2,500 per incident, which in itself is enough to allow them to proceed in federal court.

While the law predates the Internet era, Netflix and other online companies have been sued for allegedly disregarding the statute. Netflix recently agreed to pay $9 million to settle a lawsuit accusing it of violating the law.

Netflix also is lobbying Congress to amend the law by allowing people to consent online to the disclosure of their movie-rental records on an ongoing basis. The company says that such an amendment would enable it to integrate with Facebook by sharing information about the videos people stream with their friends.