The FTC recently issued a proposed order that would settle an enforcement action against Drizly, LLC and its co-founder and CEO, James Rellas, arising from data breaches in 2018 and 2020 that affected over 2.5 million customers. The FTC’s proposed order is unusual in that applies to Rellas personally. The order requires Rellas to implement various data security practices at any company he owns or oversees in the next decade, even if Rellas moves to a company unrelated to Drizly.

Let’s take a look at the data security breaches that led to the FTC’s enforcement action and some of the key takeaways that result from the FTC’s unusual proposed order.
Continue Reading Cybersecurity Regulation: Key Takeaways From an Unusual FTC Order That Will Follow CEO for a Decade

Governor Newsom recently signed into law AB 2273, the California Age-Appropriate Design Code Act (CA AADCA), making California the first state to pass broad privacy protections for children.

The CA AADCA is modeled after the UK’s Age-Appropriate Design Code (UK AADCA) which came into effect last year. While the two acts are not identical, businesses that conformed to the UK AADCA will see many similarities with the CA AADCA. Both laws seek to provide higher default privacy protections for children and set forth various requirements for covered businesses.
Continue Reading California Passes Landmark Privacy Protections for Children With Big Implications for Online Providers

Since the California Consumer Privacy Act (“CCPA”) was passed in 2018, employers have been watching carefully to see how the law will apply to data collected and maintained about their employees. Up until now, employment data had been exempted from most of the CCPA’s requirements. But the new amendments to the CCPA embodied in the California Privacy Rights Act (“CPRA”) come into effect on January 1, 2023, and that, coupled with the fact that the legislature failed to extend the employer exemptions, means that many categories of human resources data will be subject to the requirements of the law.[1]

The Current CCPA Employer Exemptions Are Expiring

As it stands (and through the end of 2022), covered employers are only obligated to notify employees of the categories of data being collected and the purposes for which the data will be used. In the event of a security breach involving employee data, employers are required to notify affected individuals and could be liable for statutory damages. In response to these requirements, most covered employers developed privacy notices with the required disclosures and reviewed their data security policies and protocols to ensure consistency with best practices.

But starting in 2023, employee data will be treated as any other commercial information, and covered employers will need to add employee and human resources data to their ongoing compliance efforts. Indeed, under the CCPA, “personal information” is defined broadly to include information that “identifies, relates to, describes, is reasonably associated with, or could reasonably be linked, directly or indirectly, with a particular consumer household.” Cal. Civ. Code § 1798.140(o)(1). In the employee or human resources context, personal information could include an employee’s contact information, insurance and benefits elections, bank and direct deposit information, emergency contacts, dependents, resume and employment history, performance evaluations, wage statements, time punch records, stock and equity grants, compensation history, and many other forms of data routinely collected in the context of the employment relationship. Moreover, the CPRA introduces a new concept of “sensitive personal information” (such as financial information, social security numbers, communications content, health information, and biometrics) that must be considered and addressed by the employer.

New Requirements Take Effect in 2023

So what does this mean for employers? First, employers must prepare and provide a privacy notice to an employee (or a job applicant since such applicant is likely providing personal information) at or before the time personal information is collected. This could mean including a privacy policy (and a click-through mechanism) on any online application site, in the employee handbook, and/or on internal websites. The privacy policy is likely to be similar to the online privacy policy the employer includes for consumers, though it will need to be revised to accurately reflect the categories of personal information collected (along with the length of time the employer intends to retain data in each category), as well as the categories of third parties with whom such information will be shared (e.g., payroll service providers, etc.).
Continue Reading Employee Data Under the CCPA: Expiration of Employer Exemptions Requires Compliance as of January 1, 2023

As companies prepare for the provisions of the California Privacy Rights Act (“CPRA”) to come into effect in January 2023, California Office of Attorney General (“OAG”) has signaled that companies should not wait to start complying with the Global Privacy Control (“GPC”). A recent lawsuit and subsequent $1.2 million settlement by the OAG against French e-commerce company Sephora, Inc. that targeted compliance with the GPC. In announcing the settlement, the OAG also made it known that it had “also sent notices today to a number of businesses alleging non-compliance relating to their failure to process consumer opt-out requests made via user-enabled global privacy controls, like the GPC” because, “[u]nder the CCPA, businesses must treat opt-out requests made by user-enabled global privacy controls the same as requests made by users who have clicked the ‘Do Not Sell My Personal Information’ link.” In other words, the OAG is taking the position that the California Consumer Privacy Act (“CCPA”) already requires implementation of the GPC.
Continue Reading California AG Signals Enforcement of the Global Privacy Control Under the CCPA

A few weeks ago on this blog, we addressed some of the legal issues that have arisen for Zoom, as it becomes a significant part of American daily life during the COVID-19 pandemic.

Among those legal issues was an inquiry by the New York State Attorney General into Zoom’s privacy practices, and particularly into its measures to detect and prevent hackers or other outside parties attempting to observe or interfere with online meetings. In several incidents, the third parties interrupted meetings with disturbing messages or images. In fact, two other states – Connecticut and Florida – joined the New York probe after state government officials fell victim to “zoombombing.” Based on perceived security flaws, on April 6, 2020, the New York City Department of Education implemented a ban on public schools’ use of Zoom for classes and educational purposes.
Continue Reading Zoom Successfully Addresses New York’s Privacy and Security Concerns

As privacy-related litigation continues to heat up, Judge Beth Freeman (ND Cal.) recently laid out in In re Google Assistant Privacy Litigation (Case No. 19-cv-04286)[1] a potential roadmap for surviving or winning a motion to dismiss on privacy-related causes of action.

The consolidated lawsuit against Google alleges violations on twelve counts, all relating to the Google Assistant product – a voice-activated technology used in mobile and home devices that listens for “hotwords” in order to carry out user commands. This case is an important one to watch and should be broadly instructive as many companies, big and small, are and have been hard at work on voice-activated technologies (compare, for instance, to Amazon’s Alexa, Apple’s Siri, and countless speech recognition start-ups around the world). Huge numbers of households and individuals currently have these devices in their homes and/or on their person at all times.
Continue Reading A Roadmap to Litigating Privacy Claims? A Look at a Recent Order From the Google Assistant Privacy Litigation

While far from getting us back to any kind of normal that predated the COVID-19 pandemic, states have begun to relax lockdown requirements and some previously closed “nonessential” businesses are returning to operations. With such openings, governmental entities, trade organizations, and others are wisely recommending protocols, including using wellness screenings, in an effort to lower the risk that such reopenings result in a reversal of trends that have flattened the infection curve. While such protocols focus on ensuring the health and wellbeing of employees, customers, and others physically visiting the businesses and are necessary in any consideration of reopening, businesses implementing new data collection from their employees and customers need to consider the privacy implications of doing so.
Continue Reading Reopening Plans and Recommended Protocols Beg New Privacy Issues

Democratic Senators Richard Blumenthal and Mark Warner have introduced the Public Health Emergency Privacy Act in response to the bill of the same subject released by Senate Republicans (the COVID-19 Consumer Data Protection Act) at the end of last month. As with the CCDPA, the PHEPA regulates the collection of emergency health data. While the respective bills differ in many ways, the most glaring distinctions focus (not surprisingly) on enforcement, preemption, and certain uses of data.
Continue Reading Senate Democrats Release Competing COVID-19 Privacy Bill

A group of Republican senators has proposed a new privacy law to govern the collection and use of certain personal information thought to be both important and at risk during the current coronavirus crisis.

While numerous companies and governments have developed and deployed apps and programs to track individuals and trace contacts between individuals in furtherance of the laudable goal of helping to better understand and address the pandemic, there have been concerns that such data could be collected without proper authorization and/or used for purposes outside of the scope for which the data is willingly provided.
Continue Reading Federal “COVID-19 Consumer Data Protection Act” Proposed