Update on Pending Privacy Bills in California

There are several online privacy bills pending in the California State Legislature that could have serious implications for all marketers. To respond to these bills, ANA has joined the State Privacy and Security Coalition, a DC-based group of tech companies and trade associations. We have also joined a privacy coalition organized by the California Chamber of Commerce.

Some of the bills have started to move. Here are details on the most significant proposals.   

AB 370: This bill, sponsored by Assemblyman Al Muratsuchi, would require California website operators to have privacy policies which “disclose whether or not the operator honors or complies with a Web browser's signal or other similar mechanism that indicates a request to disable online tracking of the individual consumer who uses or visits its commercial Web site or online service, or, if the operator does not allow third parties to conduct online tracking on the Web site or service, to disclose that fact.”

This bill is troubling because there is no currently universally accepted standard of what “Do Not Track” means. It would create the appearance that any website operator which answers that it does not honor such signals is engaged in potentially nefarious behavior. Even an explanation accompanying such a statement would send negative signals to consumers. Further, it does not distinguish tracking for purposes of targeted advertising from tracking for analytics and operational purposes.

This bill passed the State Assembly last week and is pending committee referral in the Senate, where it could be further modified. ANA is one of the founding members of the Digital Advertising Alliance (DAA), which already has an effective self-regulatory program that offers consumers choice with how information about them is collected and used. It would be counterproductive for California or any other state to adopt a Do Not Track privacy regime.   

SB 568: This bill, introduced by California State Senate President Pro Tempore Darrell Steinberg, would prohibit operators of websites, online services, and apps directed to minors or that have “actual knowledge” that minors are using their sites, services, or apps from marketing products to minors which they cannot legally purchase. It would also require operators not to permit third parties to collect or store information about minors for the purpose of marketing products to them that are not legal for them to purchase. Additionally, operators would have to provide minors with the ability to remove “content or information submitted to or posted on” the site or app and would also have to warn them that full deletion may not be possible.

This bill would be triggered by a wide range of products including houses, cars, credit cards and many others that cannot be purchased by minors. Additionally, there is concern that the “actual knowledge” standard could be triggered by knowledge of even one minor accessing the site and impose liability for all minors visiting the site, even for those of which the site operator has no knowledge.

The bill passed the Senate unanimously on April 29th and is now pending committee assignment in the State Assembly.

AB 1291: This bill, the so-called “Right to Know Act” would require website operators to provide consumers within 30 days of a request any information about “personal information” it had shared with third parties. The bill would drastically alter the definition of “personally identifiable information” for purposes of collection on the Internet. The new definition would also include Internet Protocol (IP) addresses and “information concerning the access or use of any Internet or mobile-based site or service." This would impose on businesses the burden of matching IP addresses with specific consumers, which can be difficult since IP addresses relate to devices and routers, not consumers themselves.

ANA signed a letter, along with Interactive Advertising Bureau (IAB) and the American Advertising Federation (AAF) expressing serious concerns about the mandates of the bill. The bill has been referred to the Assembly Judiciary Committee, which has fortunately voted to hold the bill in committee and make it a two-year bill, putting off any immediate consideration.  

These are only a few of the privacy bills that could have major impacts for advertisers. Given the wide reach of the population and economy of California, these bills have the potential to impose significant burdens and costs on advertisers.  

If you have any questions or more information about these bills, please contact Dan Jaffe (djaffe@ana.net) or Keith Scarborough (kscarborough@ana.net) in ANA’s Washington, DC office at (202) 296-1883.