California Privacy Rights Act (CPRA)

The Colorado Legislature recently passed the Colorado Privacy Act (“ColoPA”), joining Virginia and California as states with comprehensive privacy legislation. Colorado Governor Jared Polis signed the bill (SB 21-190) into law on July 7, and ColoPA will go into effect on July 1, 2023.

How does the measure stack up against the VCDPA and the CCPA (as amended by CPRA)? The good news is that, in broad terms, ColoPA generally does not impose significant new requirements that aren’t addressed under the CCPA or VCDPA, but there are a few distinctions to note..
Continue Reading Privacy Law Update: Colorado Privacy Bill Becomes Law: How Does it Stack Up Against California and Virginia?

Last year’s voter guide to California Proposition 24, the California Privacy Rights Act (CPRA), included a stark argument against enacting the privacy ballot initiative because it did not go far enough to protect employee privacy.  “Currently, employers can obtain all kinds of personal information about their workers and even job applicants,” the argument against Proposition

Just a few months after California officials announced the nominations of the inaugural Board members of the California Privacy Protection Agency (“CalPPA”), the CalPPA released the agenda for its first board meeting on June 14, 2021. The meeting will be held remotely in accordance with California Executive Order N-29-20, but the public may still

The California Privacy Rights Act (CPRA), effective January 1, 2023, adds “contractors” to the list of entities that a business may entrust with customer data.  So what is a “contractor?”  And how are “contractors” different from other entities described by California privacy law, such as “service providers” or “third parties?”

As it turns out, the answer is surprising.  Contractors are nearly identical to service providers, with just two differences:  contractors are not data processors; and contractors must make a contractual certification in CCPA contracts.  Moreover, contractors are not even new entities, and were already described in existing California privacy law.

Origins of “Contractors” in CCPA

To help explain the origins of the new contractor classification, we start with the California Consumer Privacy Act (CCPA).  Under the CCPA, now in effect, each disclosure of personal information from a covered business to another entity is regulated, either via consumer opt out preferences or via contractual restrictions.  Altogether, there are three potential data flows described in the CCPA:  business to third party, business to service provider, and business to a person who is not a third party.  We describe each in turn:

  • Business to Third Party:  First, when a business discloses personal information to a third party, this constitutes the “sale” of personal information (unless an exception applies, such as in the context of an intentional disclosure).  The CCPA grants consumers the right to opt out of such sales of their personal information to prevent these data flows.

As an example, selling a marketing list to a third party or sharing profile information with an adtech partner in most cases would be considered a sale of personal information to a third party.

  • Business to Service Provider:  Second, when a business discloses personal information to a service provider, no “sale” occurs and there is no right of consumers to opt out.  The requirements for the recipient to be a service provider are that (1) the service provider processes personal information on behalf of the business, and (2) the service provider agrees to retain, use, or disclose the personal information only for business purposes specified in a written contract.

Service providers provide technical, professional, and other business support to the business.  For example, a service provider might offer various services such as cloud-based servers or software, consulting, or e-commerce fulfillment services.

  • Business to a Person Who Is Not a Third Party:  Finally, there is a rarely discussed third option in the CCPA.  The CCPA states that any recipient of personal information that agrees to certain enhanced contractual terms is not a third party.  This third category requires that the recipient agree to contractual terms that mirror service provider contractual terms, along with three additional terms:  (1) to refrain from selling the personal information, (2) to refrain from retaining, using, or disclosing the information outside the direct business relationship between the recipient and the business, and (3) to certify that the recipient understands the above contractual restrictions.

This third option is significant to avoid the “sale” of personal information.  If the recipient is not a third party, then a sale can only occur if the recipient is a “business” under CCPA.  In many cases, the recipient will not be a business either, typically because the recipient does not determine the purposes and means of processing the personal information.

As an example, if an authorized reseller furnishes a manufacturer with a list of new orders for fulfillment, and the manufacturer agrees to use the list only to fulfill orders, the manufacturer is not a third party.   Because the manufacturer does not determine the purposes and means of processing the personal information it receives, the manufacturer is not acting as a “business.”  No sale occurs.

Similarly, if an identity verification service sends personal information to a company to assist that company with confirming the identity of an applicant for service, and the company agrees contractually to limit its use and disclosure of the information for business purposes, the recipient is not a third party or business and no sale occurs from the identity verification service to the business.

Here’s a summary of the entities that may receive personal data under the CCPA:
Continue Reading CPRA Update: What is a “Contractor?”

California officials today announced their nominees to be the five inaugural members of the California Privacy Protection Agency (“CPPA”) Board.  Created by the California Privacy Rights Act (“CPRA”), the CPPA will become a powerful, state-level privacy regulator long before its enforcement authority becomes effective in 2023, and today’s appointments move the CPPA one large step

The California Consumer Privacy Act (CCPA) right to non-discrimination explainedThe California Attorney General’s office announced a fourth set of proposed modifications to the CCPA regulations. These modifications: (1) clarify the requirement for businesses that sell personal information that is collected offline to provide offline opt-out notices; and (2) propose an opt-out button for businesses to feature online along with opt-out notices and the “Do

Ad Law Access PodcastAs covered in the blog post “It’s Here: California Voters Approve the CPRA,” California voters passed ballot Proposition 24, the California Privacy Rights Act of 2020 (“CPRA”)  Also known as CCPA 2.0, CPRA brings a number of changes to the CCPA, the majority of which will become operative on January 1, 2023. In

On Tuesday, November 3, 2020, California voters passed ballot Proposition 24, the California Privacy Rights Act of 2020 (“CPRA”). Also known as CCPA 2.0, CPRA brings a number of changes to the CCPA, the majority of which will become operative on January 1, 2023. In addition to revising some of the definitions that are fundamental

California became the first U.S. state with a comprehensive consumer privacy law when the California Consumer Privacy Act (“CCPA”) became operative on January 1, 2020. The CCPA provides for broad privacy rights for residents of California and imposes data protection obligations on companies doing business in California that meet certain criteria.  For further background on