The Supreme Court will decide who can sue over the video on your website

Today, that same law is being used to sue companies that have nothing to do with video rentals: sports websites, news outlets, retailers, and other businesses whose sites simply show video next to the same advertising tools most websites already use.

The case, Salazar v. Paramount Global, comes down to one question: Who can sue under this law? Courts around the country don’t agree on the answer, and whatever the Supreme Court decides could make many more, or many fewer, businesses vulnerable to these lawsuits.

Clym reviewed Supreme Court filings, court rulings, and lawsuit and settlement records to see how a law built for VHS-era video stores ended up being tested against the technology that runs most modern websites.

According to the American Bar Association, people file roughly 200 lawsuits a year under this law. Most follow the same basic pattern: Someone watched a video on a website, and a tracking tool, often one built by Meta, Facebook’s parent company, was running in the background.

What the Supreme Court agreed to decide

The Court agreed to hear the case on Jan. 26, 2026, and will hear arguments on Oct. 14, 2026. The question in front of the justices: Does this 1988 law only protect people who signed up for video-related products and services, or does it protect anyone who signed up for anything on a website that also happens to show video?

Here’s how the case started. Michael Salazar signed up for a free daily email newsletter from 247Sports.com, a college sports recruiting website owned by Paramount Global, giving the site his email and IP address. He claims Paramount had a Meta tracking tool installed on the site, and that later, when he watched videos there while logged into Facebook, that tool sent his Facebook account information, along with the names and links of the videos he’d watched, straight to Meta without asking him first.

A federal judge and a divided panel of appeals judges sided with Paramount: signing up for a newsletter, they said, doesn’t make someone a video consumer, so the law didn’t apply to Salazar.

Several major companies and trade groups, including Meta, the National Retail Federation, and the U.S. Chamber of Commerce, have filed briefs urging the Supreme Court to side with Paramount. A privacy rights group, the Electronic Privacy Information Center, has filed on Salazar’s side. That kind of lineup suggests plenty of mainstream businesses, not just tech companies, are watching how this turns out.

Why courts don’t agree

Two other federal appeals courts have already looked at nearly the same situation, someone who signed up for something free on a website that also shows video, and reached the opposite conclusion. In one case, a fan who’d signed up for the NBA’s free newsletter and then watched free video on NBA.com while logged into Facebook made the same complaint about the same Meta tool; that court said the law protects him, too. In another, people who’d given a classic-TV website their email and zip code in exchange for show reminders got the same result.

The court deciding Salazar’s case went the other way: It said the law was written specifically to protect people’s video-watching habits, so it protects only people who signed up for something related to video, not just any newsletter on a site that also shows clips. That disagreement between courts is why the Supreme Court stepped in.

How a video and a tracking tool intersect

Most websites use small pieces of tracking code, often called pixels, that report to companies like Meta or Google about what visitors do on the website. That’s usually done to measure ads or figure out who to show ads to later, and it’s everywhere: a 2024 study found that roughly half of the websites it analyzed used Meta’s version of this tool, including more than half of S&P 500 companies.

These lawsuits aren’t about having one of these tools on a website. The specific claim in these cases is narrower: that when someone watches a video, the tracking tool sends the name or web address of that video, together with something that identifies the visitor, like an account ID pulled from a cookie already sitting in their browser, back to a company like Meta. Plaintiffs say that combination, exactly what video someone watched plus who they are, is the kind of private information this 1988 law was written to protect.

Not every website with both a video and a tracking tool has automatically broken this law; it depends on what information that tool sends and, as the Supreme Court is now deciding, whether the visitor counts as someone the law protects in the first place. But the basic setup, video content next to a tracking tool and some way to identify visitors, shows up on a huge range of ordinary business websites, which is exactly why this case matters well beyond Hollywood or streaming services. A retailer, a local news site, a sports league, or a real estate company could all, in theory, face one of these lawsuits.

What a $5 million settlement shows, and doesn’t

The financial stakes became very real recently in a case against Dapper Labs, the company behind blockchain-based collectible platforms like NBA Top Shot and NFL All Day. People who’d used those platforms sued, claiming tracking tools on the sites sent their video-watching and purchase activity to advertising companies without asking first.

The $5 million settlement covers anyone who had an active account on those platforms between June 2020 and January 2025. A New York state court gave it final approval in April 2026, and Dapper Labs sent payments to eligible people in July. Dapper Labs never admitted to breaking the law, and the settlement doesn’t say it did; the company agreed to pay to avoid the cost and risk of a long court fight, not because a judge ruled against it.

Beyond streaming: who else has been sued

Because so many ordinary websites combine video with basic advertising tools, these lawsuits have already reached sports leagues and betting sites, sports news sites, classic-TV streaming services, real estate listing sites, and, in one case that was later thrown out, even a cereal company whose newsletter and online videos drew a similar complaint. Courts haven’t treated every claim the same way, and simply being sued isn’t proof that a company actually did anything wrong.

Part of why so many companies are fighting this in court comes down to money. The law guarantees at least $2,500 per violation, even if nobody can prove they were actually harmed. If a single lawsuit covers tens of thousands, or even hundreds of thousands, of website visitors, that $2,500 minimum can add up to a claim worth tens of millions of dollars, which helps explain why businesses have pushed this fight to the Supreme Court.

Whatever the Supreme Court decides, it won’t rule on whether any specific tracking tool or video setup is against the law. It will decide something narrower but still very important: who is even allowed to walk into court and make that claim in the first place. That answer could open the door to a lot more lawsuits, or close it, for businesses that never thought of themselves as being anywhere near the video industry.

This story was produced by Clym and reviewed and distributed by Stacker.