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  • California Attorney General settles with food delivery company for allegedly violating two state privacy acts

    Privacy, Cyber Risk & Data Security

    On February 21, the California State Attorney General Office announced its complaint against a food delivery company for allegedly violating the California Consumer Privacy Act of 2018 (CCPA) and the California Online Privacy Protection Act of 2003 (CalOPPA) for failing to provide consumers notice or an opportunity to opt-out of the sale.

    The CCPA requires businesses that sell personal information to make specific disclosures and give consumers the right to opt out of the sale. Under the CCPA, a company must disclose a privacy policy and post an “easy-to-find ‘Do Not Sell My Personal Information’ link.” The California AG alleged that the company provided neither notice. The AG also alleged that the company violated CalOPPA by not making required privacy policy disclosures. The company’s existing disclosures indicated that the company could only use customer data to present someone with advertisements, but not give that information to other businesses to use.

    The proposed stipulated judgment, if approved by a court, will require the company to pay a $375,000 civil money penalty, and to (i) comply with CCPA and CalOPPA requirements; (ii) review contracts with vendors to evaluate how the company is sharing personal information; and (iii) provide annual reports to the AG on potential sales or sharing personal information.

    Privacy, Cyber Risk & Data Security California State Attorney General CCPA CalOPPA Enforcement Data

  • California Attorney General investigates streaming services for CCPA violations

    Privacy, Cyber Risk & Data Security

    On January 26, California State Attorney General Rob Bonta announced an investigative initiative by issuing letters to businesses operating streaming apps and devices, accusing them of non-compliance with the California Consumer Privacy Act (CCPA). The focus of the investigation is the evaluation of streaming services’ adherence to the CCPA's opt-out requirements, in particular those businesses that sell or share consumer personal information. The investigation targets businesses failing to provide a direct mechanism for consumers wishing to prevent the sale of their data.

    AG Bonta urged consumers to know about and exercise their rights under the CCPA, emphasizing the right to instruct businesses not to sell their personal information. The CCPA grants California consumers enhanced rights regarding the collection, sharing, and disclosure of their personal information by businesses, and compliance responsibilities include responding to consumer requests and providing necessary notices about privacy practices. AG Bonta noted that the right to opt-out under the CCPA mandates that businesses selling or sharing personal data for targeted advertising must facilitate an easy and minimal-step process for consumers to exercise their right. For example, users should be able to easily navigate their streaming service’s mobile application settings to enable the “Do Not Sell My Personal Information” option. The expectation is that this choice remains effective across various devices if users are logged into their accounts when electing to opt-out. Finally, Bonta added that consumers should be given easy access to a streaming service’s privacy policy outlining their CCPA rights. 

    Privacy, Cyber Risk & Data Security State Issues State Attorney General CCPA California Compliance Opt-Out Consumer Protection

  • California enacts two privacy bills AB 1194 and AB 947

    State Issues

    On October 8, the California governor signed two bills, AB 947 amending the California Consumer Privacy Act of 2018, and AB 1194 amending the California Privacy Rights Act (CPRA) of 2020. AB 947 amends the definition of “sensitive personal information” to include any personal information that reveals a consumer’s citizenship or immigration status. AB 1194 will ensure that when a consumer’s personal information relates to “accessing, procuring, or searching for services regarding contraception, pregnancy care, and perinatal care, including, but not limited to, abortion services,” business are obligated to comply with CPRA, except in cases where the information is in an aggregated, deidentified form and is not sold or shared. CRPA already empowers consumers to request the deletion of their personal information, with some exceptions to accommodate a business's obligations to adhere to federal, state, or local laws, fulfill court orders, respond to subpoenas for information, or cooperate with government agencies in emergency situations involving potential risks to a person's life or physical well-being.

    AB 947 is effective January 1, 2024 and AB 1194 is effective July 1, 2024.

    State Issues Privacy, Cyber Risk & Data Security State Legislation CPRA CCPA Consumer Protection

  • CPPA continues efforts towards California Privacy Rights Act

    State Issues

    The California Privacy Protection Agency board is continuing its efforts to prepare regulations implementing the California Privacy Rights Act (covered by InfoBytes here and here).

    Draft risk assessment regulations and cybersecurity audit regulations were released in advance of the September 8 open meeting held by the board. Draft regulations on automated decision-making remain to be published. More comprehensive comment and feedback is expected on these draft regulations, unlike regulations finalized in March that were presented in a more robust state. As previously covered by InfoBytes, the California Privacy Protection Agency cannot enforce any regulations until a year after their finalization, adding a ticking reminder to the finalization process for these draft regulations.

    The draft cybersecurity regulations include thoroughness requirements for the annual cybersecurity audit, which must also be completed “using a qualified, objective, independent professional” and “procedures and standards generally accepted in the profession of auditing.” A management certification must also be signed certifying the business has not influenced the audit, and has reviewed the audit and understands its findings.

    The draft risk assessment regulations require conducting a risk assessment prior to initiating processing of consumers’ personal information that “presents significant risk to consumers’ privacy,” as set forth in an enumerated list include the selling or sharing of personal information; processing personal information of consumers under age 16; and using certain automated decision-making technology, including AI.

    State Issues Privacy California CCPA CPPA CPRA Compliance State Regulators Opt-Out Consumer Protection

  • Dubai to facilitate personal data transfers with California-based entities

    Privacy, Cyber Risk & Data Security

    On August 9, the Dubai International Financial Centre Authority (DIFC) Commissioner of Data Protection issued a “first-of-its-kind” adequacy decision, declaring California’s data protection regime as “substantially equivalent and low risk.” The DIFC deemed the California Consumer Privacy Act (CCPA) of 2018, as amended by the California Privacy Rights Act of 2020, equivalent to DIFC’s DP Law 2020—opening the door to facilitate personal data transfers between DIFC and California-based entities without the need to apply additional contractual measures. The DIFC further noted that CCPA Regulations provide procedures, guidance, and clarity on the requirements of the CCPA and highlighted the key aspects of CCPA, including (i) concepts and definitions; (ii) breach notification requirements; (iii) enforcement authority; (iv) notifications to the commissioner; and (v) commissioner authority and objectives. The DIFC’s decision outlines nine observations regarding California’s data protection regime that informed its adequacy decision. In its press release, the DIFC noted that the CCPA “gives consumers control and protection over personal data collected by businesses” and limits data collection and processing to what is fair, lawful, and necessary. The DIFC added that this adequacy decision sets a precedent for Dubai to build “similar relationships with various US states and the US privacy framework in the future.” 

    Privacy, Cyber Risk & Data Security State Issues CCPA UAE DIFC California

  • California Privacy Protection Agency announces its first inquiry

    Privacy, Cyber Risk & Data Security

    On July 31, the California Privacy Protection Agency (CPPA) announced a review of the data privacy practices of “connected vehicle” manufacturers and related technologies. Executive Director of the CCPA Ashkan Soltani stated in the press release that the agency is “making inquiries into the connected vehicle space to understand how these companies are complying with California law when they collect and use consumers’ data.” The vehicles in question contain tracking technology that raised data concerns under the California Consumer Privacy Act. Notably, this is the first action from the agency’s enforcement division.

    Privacy, Cyber Risk & Data Security State Issues State Regulators California CCPA CPPA Enforcement

  • California probes employers’ CCPA compliance

    Privacy, Cyber Risk & Data Security

    On July 14, the California attorney general announced it recently sent inquiries to several large employers as part of an investigation into companies’ compliance with their legal obligations under the California Consumer Protection Act (CCPA). The investigation centers on how companies handle the personal information of employees and job applicants. As previously covered by InfoBytes, temporary exemptions related to human resource and business-to-business data provided by the CCPA and the California Privacy Rights Act expired on January 1 of this year. Amendments were introduced last legislative session that would have extended the exemption for “personal information that is collected and used by a business solely within the context of having an emergency contact on file, administering specified benefits, or a person’s role . . . [in] that business.” The amendments also proposed extending certain exemptions related to “personal information reflecting a communication or a transaction between a business and a company, partnership, sole proprietorship, nonprofit, or government agency that occurs solely within the context of the business conducting due diligence or providing or receiving a product or service.” However, the amendments were not adopted, and the exemptions expired.

    The AG said they are sending the inquiry letters “to learn how employers are complying with their legal obligations.” Covered businesses subject to the CCPA are required to comply with the statute’s privacy protections as they relate to employee data, including providing notice of privacy practices and honoring consumer requests to exercise their rights to access, delete, and opt out of the sale and sharing of their personal information.

    Privacy, Cyber Risk & Data Security State Issues California State Attorney General CCPA Consumer Protection

  • Court delays enforcement of California privacy regulations

    Privacy, Cyber Risk & Data Security

    The Superior Court for the County of Sacramento adopted a ruling during a hearing held June 30, granting the California Chamber of Commerce’s (Chamber of Commerce) request to enjoin the California Privacy Protection Agency (CPPA) from enforcing its California Privacy Rights Act (CPRA) regulations until March 2024. Enforcement of the CPRA regulations was set to begin July 1.

    The approved regulations (which were finalized in March and took effect immediately) update existing California Consumer Privacy Act regulations to harmonize them with amendments adopted by voter initiative under the CPRA in November 2020. (Covered by InfoBytes here.) In February of this year, the CPPA acknowledged that it had not finalized regulations regarding cybersecurity audits, risk assessments, and automated decision-making technology and posted a preliminary request for comments to inform this rulemaking. (Covered by InfoBytes here.) The June 30 ruling referred to a public statement issued by the CPPA, in which the agency explained that enforcement of those three areas would not commence until after the applicable regulations are finalized. However, the CPPA stated it intended to “enforce the law in the other twelve areas as soon as July 1.”

    In March, the Chamber of Commerce filed a lawsuit in state court seeking a one-year delay of enforcement for the new regulations. The Chamber of Commerce argued that the CPPA had finalized its regulations in March 2023 (rather than the statutorily-mandated completion date of July 1, 2022), and as a result businesses were not provided the required one-year period to come into compliance before the CPPA begins enforcement. The CPPA countered that the text of the statute “is not so straightforward as to confer a mandatory promulgation deadline of July 1, 2022, nor did the voters intend for impacted business to have a 12-month grace period between the [CPPA’s] adoption of all final regulations and their enforcement.”

    The court disagreed, finding that the CPPA’s failure “to timely pass final regulations” as required by the CPRA “is sufficient to grant the Petition.” The court stated that because the CPRA required the CPPA to pass final regulations by July 1, 2022, with enforcement beginning one year later, “voters intended there to be a gap between the passing of final regulations and enforcement of those regulations.” The court added that it was “not persuaded” by the CPPA’s argument “that it may ignore one date while enforcing the other.” However, staying enforcement of all the regulations for one year until after the last of the CPRA regulations have been finalized would “thwart the voters’ intent.” In striking a balance, the court stayed the CPPA’s enforcement of the regulations that became final on March 29 and said the agency may begin enforcing those regulations on March 29, 2024. The court also held that any new regulations issued by the CPPA will be stayed for one year after they are implemented. The court declined to mandate any specific date by which the CPPA must finalize the outstanding regulations.

    Privacy, Cyber Risk & Data Security State Issues Courts California CPRA CPPA Enforcement CCPA

  • California OAL approves CCPA regulations

    Privacy, Cyber Risk & Data Security

    On March 30, the California Privacy Protection Agency (CPPA) announced that the California Office of Administrative Law (OAL) approved the agency’s first substantive rulemaking package for implementing the California Consumer Privacy Act (CCPA). The approved regulations are effective immediately. The CPPA noted that the approved regulations update existing CCPA regulations to harmonize them with amendments adopted under the California Privacy Rights Act (CPRA), which was approved by ballot measure in November 2020 to amend and build on the CCPA. In February, the CPPA voted unanimously to adopt and approve the regulations, which have not been substantively changed since the CPPA voted on modifications last year (covered by InfoBytes here). The final regulations and supporting materials are now available on the CPPA’s website.

    The CPPA has already begun additional rulemaking. The agency issued a preliminary request for comments on cybersecurity audits, risk assessments, and automated decision-making to inform future rulemaking in February. Comments were due at the end of March.

    Privacy, Cyber Risk & Data Security Agency Rule-Making & Guidance State Issues State Regulators California CPRA CPPA CCPA

  • District Court approves $1.75 million data breach settlement

    Privacy, Cyber Risk & Data Security

    On March 3, the U.S. District Court for the Central District of California granted final approval of a $1.75 million class action settlement resolving allegations related to a 2020 data breach that compromised nearly 100,000 individuals’ personally identifiable information, including financial information, social security numbers, health records, and other personal data. The affected individuals are students, parents, and guardians who were enrolled in a system used to manage student data in a California school district. According to class members, by failing to adequately safeguard users’ login credentials and by failing to timely notify individuals of the breach, the company violated, among other things, California’s unfair competition law, the California Customer Records Act, and the California Consumer Privacy Act.

    Under the terms of the settlement, the company is required to pay a non-reversionary settlement amount of $1.75 million, which will be used to compensate class members and pay for attorney fees and costs, service awards, and administrative expenses. Additionally, as outlined in the motion for preliminary approval of the class action settlement, class members are eligible to submit claims for “ordinary losses” (capped at $1,000 per person), as well as “extraordinary losses” (capped at $10,000 per person). Ordinary losses include expenses such as bank fees, long distance phone charges, certain cell phone charges, postage, gasoline for local travel, “[f]ees for additional credit reports, credit monitoring, or other identity theft insurance products,” and up to 40 hours of time, at $25/hour, for at least one full hour used to deal with the data breach. Extraordinary losses are described as those “arising from financial fraud or identity theft” where the “loss is an actual, documented, and unreimbursed monetary loss” and is “fairly traceable to the data breach” and not already covered by another reimbursement category. Class members must also show that they made “reasonable efforts to avoid, or seek reimbursement for, the loss.” All class members will be offered 12 months of credit monitoring and identity theft protection at no cost, and the company will implement “information security enhancements” to prevent future occurrences.

    Privacy, Cyber Risk & Data Security Courts Settlement Data Breach Class Action State Issues California CCPA

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