Honoring a privacy agreement requires character, morals, ethics and honor. To do otherwise, as Toysmart and others want to do, is dishonorable as well as a breach of contract. Affected consumers should sue to teach parties that default on their contracts a lesson. Punitive damages would teach what the defaulters didn't learn about honor, character, trust and principles from their parents, teachers and other role models.
It's too bad that so many marketers today are like buccaneers; they can't be trusted to keep their word. They are opportunistic bad boys who need to be sued, if not slapped on their asses.
Arguments that it is ethical for Toysmart not to honor its privacy agreement because its customers bought toys are absurd, without merit and irrelevant. That position would not stand up in court.