In a July 2010 letter, the Federal Trade Commission recently warned potential purchasers of certain customer data that the transfer and use of such data could violate the seller’s own privacy policies and, therefore, constitute an unfair or deceptive act or practice in violation of the Federal Trade Commission Act. The Director of the FTC’s Bureau of Consumer Protection, David Vladeck, made this position clear in a letter written to several investors who had expressed a desire to purchase customer data collected by the now defunct XY Magazine and XY.com in a bankruptcy sales process. The letter cautions of the likelihood that sensitive personal information of customers may be used lawfully only in the transaction for which it was collected. Sellers of such customer data, including when the sale is part of a larger business combination, should make certain the sale is permitted by their privacy policies. Purchasers of such customer data need to make certain they perform proper due diligence on the seller’s privacy policies, as well as make certain their plans for using the data post-acquisition will be permissible under the FTC Act.