Warning that “[t]here are no more excuses,” California Attorney General on August 24, announced the first public settlement under the California Consumer Privacy Act (CCPA). The settlement order, which the court approved on the same day, requires beauty-product retailer Sephora, Inc., to pay a $1.2 million civil penalty to resolve allegations that the company
The FTC’s Privacy Rulemaking: Broad and Far-Reaching, but Unlikely to Lead to a Rule Anytime Soon
On August 11, the FTC finally launched its “commercial surveillance and data security” rulemaking after many months of hype and speculation about the FTC’s ability to address consumer privacy through its “Mag-Moss” rulemaking authority. It did so by releasing (by 3/2 vote) an Advanced Notice of Proposed Rulemaking (ANPR) – the first step in a Mag-Moss rulemaking – and holding a press conference featuring Chair Khan, Commissioners Slaughter and Bedoya, and senior FTC staff.
People familiar with the many hurdles in Mag-Moss were watching to see whether the ANPR would be broad and far-reaching (thus guaranteeing a lengthy, complex process) or more narrowly tailored. The answer? The ANPR is remarkably sweeping in scope – covering virtually every form of data collection across the economy, posing 95 questions about factual and legal issues of all kinds, and raising issues that reach beyond the FTC’s legal authority. Indeed, in reading the ANPR, we couldn’t help but wonder whether this is a serious effort to develop a rule or simply a show of activity to address over-hyped expectations. (See more on this topic below.)
Not surprisingly, Commissioners Phillips and Wilson issued strong dissents. Among other things, they raised concerns about agency overreach and the potential to derail the bipartisan privacy bill currently pending in Congress (the ADPPA). Here are more details and takeaways from the FTC’s announcement:
Continue Reading The FTC’s Privacy Rulemaking: Broad and Far-Reaching, but Unlikely to Lead to a Rule Anytime Soon
Preparing for Expanded Consumer Rights Requests Under the CPRA
With the clock now running on the comment period for the California Privacy Protection Agency’s (CPPA) Draft Regulations to implement the CPRA – comments are due on August 23 – one of the items on many businesses’ CPRA preparation to-do lists is to address new (and the expansion of existing) consumer rights. The Draft Regulations published by the CPPA lay out how the CPPA is likely to define these obligations. This post takes a deeper look at what’s in the CPPA’s proposal – as well as what’s missing.
A couple of overarching points are worth keeping in mind. First, implementing the CPRA’s consumer rights provides an occasion to review and update data maps so that they accurately capture how personal information flows both through their organizations and to service providers, contractors, and/or third parties. Second, preparing for CPRA consumer requests should go hand-in-hand with reviewing the systems and procedures that are in place to honor consumers’ requests.
Continue Reading Preparing for Expanded Consumer Rights Requests Under the CPRA
On Notice: “Notice at Collection” and Privacy Policy Requirements Under the CPPA’s Draft Regulations
Among the many details to absorb in the draft amendments to the CCPA regulations published by the California Privacy Protection Agency (“CPPA”) on May 27 (the “Draft Regulations”) are new and prescriptive disclosure requirements for notices at collection and privacy policies. While these disclosure provisions (and all of the other provisions of the Draft Regulations)
New California Draft Privacy Regulations: How They Would Change Business Obligations and Enforcement Risk
On Friday May 27, 2022, the California Privacy Protection Agency (CPPA) Board announced its next public meeting will be on June 8, 2022. The announcement simply stated the date of the meeting, that there are “some discussion items [that] will be relevant to the Agency’s rulemaking work,” and that information on how to attend the meeting and the meeting agenda could be found on the CPPA’s site. It did not take too many Internet sleuths to review the posted agenda, and note that Agenda Item No. 3 was “Discussion and Possible Action Regarding Proposed Regulations, Sections 7000–7304, to Implement, Interpret, and Make Specific the California Consumer Privacy Act of 2018, as Amended by the California Privacy Rights Act of 2020, Including Possible Notice of Proposed Action,” and that the posted meeting materials included a copy of the “Draft Proposed CCPA Regulations.” In addition, Agenda Item No. 4 provides for “Delegation of Authority to the Executive Director for Rulemaking Functions.” Full stop, June will be an active month for California privacy rulemaking.
But let’s unpack the surprises in the draft regulations. The 66-page draft proposed CCPA regulations (and they are referred to within the document as CCPA regulations) take a prescriptive approach to privacy obligations. In concept, that is not too surprising. Of concern, in some areas, they uniquely depart from approaches set forth by other state privacy laws. The quiet release of dramatic new obligations while bipartisan Senators reportedly may be reaching consensus on federal privacy legislation that could preempt state law obligations puts companies doing business in California in a difficult position. Do they scramble to operationalize new programs to comply with the CPPA’s new requirements, if finalized? Do they wait on Congress? Do they choose a third path? For now, while these draft rules are certain to change in some respects before they are finalized, they directionally outline a new privacy baseline for the United States. We highlight certain aspects of the draft rules below, with a particular focus on accountability and risk exposure, how data can be shared with other businesses for digital advertising or other functions, and what those business agreements must include to lawfully support such business relationships and comply with the amended CCPA.
Continue Reading New California Draft Privacy Regulations: How They Would Change Business Obligations and Enforcement Risk
Privacy Priorities for 2022: Tracking State Law Developments
The replay for our April 28, 2022 Privacy Priorities for 2022: Tracking State Law Developments webinar is available here.
In the absence of a federal privacy law, privacy has been at the forefront of many states’ legislative sessions this year. Against this backdrop, state attorneys general continue to initiate investigations into companies’ privacy practices,
How the Utah Consumer Privacy Act Stacks Up Against Other State Privacy Laws
As companies wait to see whether the Utah Consumer Privacy Act (UCPA) becomes the fourth comprehensive state privacy law, we are providing an overview of some of the Act’s key provisions – and how they depart from comprehensive privacy laws in California, Colorado, and Virginia.
Utah’s Senate unanimously passed the UCPA on February 25. The House – also through a unanimous vote – followed on March 2. The Legislature sent the UCPA to Governor Spencer Cox on March 15. Because the Legislature adjourned on March 4, Governor Cox has 20 days from the date of adjournment – March 24 – to sign or veto the Act. If Governor Cox takes no action, the UCPA will become law, with an effective date of December 31, 2023.
In broad strokes, the UCPA is similar to the Virginia Consumer Data Protection Act (VCDPA) and Colorado Privacy Act (CPA). And, like the laws in Colorado and Virginia, the UCPA borrows some concepts from the CCPA – including a version of the right to opt out of the “sale” of personal data.
However, the UCPA pares back important features of all three of these laws. Some of the significant changes include:
- Applicability. The UCPA’s applicability is narrower than the three other comprehensive state privacy laws. The UCPA applies only to controllers or processors that (1) do business in the state (or target Utah residents with products or services); (2) earn at least $25 million in revenue; and (3) either: (a) control or process personal data of 100,000 or more consumers in a calendar year; or (b) derive more than 50 percent of gross revenue from selling personal data and control or process data of 25,000 or more consumers. By contrast, the $25 million revenue threshold is an independent basis for the CCPA to apply to a business; and neither the CPA nor VCDPA includes a revenue-based exemption.
- Exemptions. In addition to exempting personal data that is subject to sector-specific privacy laws and regulations, such as HIPAA, the Gramm-Leach-Bliley Act, and the Fair Credit Reporting Act, the UCPA provides that the Act does not apply to certain entities, including a tribes, institutions of higher education, and nonprofit corporations.
- Sale and Targeted Advertising Opt-Out Rights. Although the UCPA requires controllers to provide consumers with the ability to opt out of sale and targeted advertising, the Act does not provide a right to opt out of profiling (or otherwise address profiling). Like the VCDPA, the UCPA restricts the definition of “sale” to “the exchange of personal data for monetary consideration by a controller to a third party.” This definition does not include “other valuable consideration,” found in the definitions of “sale” under the CCPA and CPA.
- Opt-Out Consent to Process Most Sensitive Data. The UCPA does not require opt-in consent to process most sensitive data, unless the data “concern[s] a known child,” unlike the opt-in requirements of the CPA and VCDPA. Instead, the UCPA requires controllers to “present[] the consumer with clear notice and an opportunity to opt out” of sensitive data processing.
- Other Consumer Rights. The UCPA provides consumers the right to confirm processing and to delete personal data they provided to a controller. Consumers also have the right to obtain a portable copy of personal data that the consumer “previously provided to the controller.” This “provided to” language follows the VCDPA’s access and portability right and contrasts with obligations to provide personal data “concerning” (CPA) or “about” (CCPA) a consumer. The UCPA does not provide a right of correction or accuracy.
- Enforcement and Regulation. The UCPA does not include a private cause of action, nor does it authorize the Attorney General or other state official or agency to issue regulations. The Division of Consumer Protection, in the Utah Department of Commerce, investigates potential violations and can refer an action to the Utah Attorney General for enforcement. The Attorney General can recover actual damages for consumers and a penalty of up to $7,500 per violation, but only after a 30 day notice and right to cure period.
Continue Reading How the Utah Consumer Privacy Act Stacks Up Against Other State Privacy Laws
California AG’s First CCPA Opinion Takes a Broad View of the Right to Access Inferences
In the first formal written opinion interpreting CCPA compliance obligations, California Attorney General Rob Bonta concludes that the CCPA grants consumers the right to know and access internally generated inferences that businesses generate about them, but that the CCPA does not require businesses to disclose trade secrets.
The 15-page opinion, issued on March 10, responds to a question posed by Sacramento area Assemblyman Kevin Kiley (R): “Under the California Consumer Privacy Act, does a consumer’s right to know the specific pieces of personal information that a business has collected about that consumer apply to internally generated inferences the business holds about the consumer from either internal or external information sources?”
OAG’s response, in a nutshell, is “yes.” Giving consumers access to inferences is important, according to OAG, because “inferences are one of the key mechanisms by which information becomes valuable to businesses, making it possible to target advertising and solicitations, and to find markets for goods and services.” OAG further notes that nothing in the Consumer Privacy Rights Act (CPRA) changes its analysis. The opinion also suggests that the OAG will refer to the CCPA’s broad purposes, such as giving “consumers greater control over the privacy of their personal information,” to support its interpretations.
Continue Reading California AG’s First CCPA Opinion Takes a Broad View of the Right to Access Inferences
Webinar Replay: Privacy Priorities for 2022 – FTC
The replay for our May 19, 2022 Privacy Priorities for 2022 webinar is available here.
Under Chair Lina Khan, the Federal Trade Commission has announced an aggressive privacy agenda, which is unfolding on the enforcement, regulatory, and policy fronts. In recent enforcement actions, the FTC has sought stringent remedies, including data deletion, bans on
Upcoming webinar on recent FTC privacy developments and predictions for 2022
Please join us for a webinar on February 24, 2022 at 4 p.m. on recent and upcoming FTC developments. The webinar will feature Kelley Drye’s Jessica Rich and Aaron Burstein, both former FTC officials, and will be moderated by the newest addition to our privacy team, Jayson Lewis. Here’s a taste of what we’ll be