No compensation for data protection-violating data trading

Can a company that commercially trades in data demand its compensation even if the transfer of the transmitted data violates data protection law? The Local Court (AG) Hagen had to decide on this in the case of online leads.

A company specializing in new customer acquisition had transferred concrete consultation requests from potential new customers, including their contact data, so-called leads, to a foreign company in Cyprus. The buyer was unable to use the data as planned to successfully establish contacts from a service provider to new customers. The supplier therefore had to bring an action to claim payment for the leads.

Google AdWords had been used for lead or new customer generation. The supplier of the online leads claimed to have also obtained the consent of the potential new customers to the transfer of their data there.

The court's decision

The Local Court (AG) Hagen dismissed the data trader's claim for payment in its judgment of 30.06.2014. There was in no way any consent to the transfer of the data to the defendant company in Cyprus contained in the data protection declaration relied upon. The consent had covered only the transfer to a bank, but not as in this case to a company in Cyprus which did not even possess a banking licence. Thus the right to informational self-determination had been violated. The contract between the data trader and the buyer was contrary to law and public policy, so that a duty to pay was not validly agreed upon.data protection declaration

Conclusion

Where there is a violation of data protection law, the Local Court (AG) Hagen takes the view that no right to compensation for the data trader comes into question. If trading in data is part of the business concept, possibly in conjunction with online advertising campaigns, a specialist in data protection law and Internet law should be appointed to assess the legal questions.