California, home to more than 40 million people and the 5th largest economy in the world, has passed the California Consumer Privacy Act (CCPA), its omnibus consumer privacy law. The law creates sweeping new requirements concerning the collection, maintenance, and tracking of information for both employees or customers who are residents of California. Many aspects of the implementation and enforcement are still being finalized by the California Attorney General. However, companies with employees or customers in California need to take stock of the information they are processing that could qualify as “personal information” for California residents, and they need to begin establishing mechanisms for compliance before the end of 2019. Continue Reading The California Consumer Privacy Act of 2018: What Businesses Need to Know Now
At the end of June, the California legislature passed its Bill 375, the California Consumer Privacy Act of 2018. The Act contains a number of concepts that would be familiar to those who are working to bring their companies and organizations into compliance with GDPR. The new law defines a category of “Personal Information” that radically departs from a traditional definition of Personal Data commonly found in various State Data Privacy Laws, which usually ties an individual name to other identifiers like social security number, account number, or other factors. Instead, the California Act defines “Personal Information” as information that identifies, relates to, describes, is capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer or household. It does not, mercifully, include publicly available information, but it still comes closer to a GDPR-like definition of “personal data” than any other US law.
The Act provides California residents some rights that also appear familiar. For example:
- Consumers can request a copy of all the Personal Information a business has collected;
- Consumers have the right to request that the business delete their Personal Information (subject to some exceptions), and a right to direct a company to not share their Personal Information with third parties; and
- Consumers can request that a business disclose the categories of information it has collected, the sources of information, the purpose for the collection and/or its sale of the information, and the third parties with whom the information is shared.
These certainly sound like concepts that could be referenced as The Right to Access; The Right to Be Forgotten; and Data Portability.
Business requirements include:
- Meaningful notifications to consumers at the point of contact where Personal Information is collected;
- Updated online privacy notices to include the types of Personal Information collected, the purpose of collection, and rights information;
- Implementation of Data Security measures to protect Personal Information;
- Providing training to employees handling Personal Information or involved in consumer inquiries;
- The inclusion of provisions in contracts with third parties with whom Personal Information is shared to include data privacy protections and restrictions on disclosure; and
- The inclusion of a “do not sell my personal information” option on public facing interfaces and websites that collect personal information. Companies must take measures to not discriminate against users who opt out, but at the same time they can offer price incentives to those who chose to opt in.
The Act takes effect on January 1, 2020. It has the same approximate 2 year “runway” period that GDPR provided in 2016 (leading up to May 25, 2018) for companies to gear up their compliance. This law has potentially widespread impact, but some of the mechanisms of its application remain unclear, due in some degree to some of its broadly worded language. In this way, it is also similar to the GDPR.
The challenge with implementation for large companies is the same as every other State level data privacy law – it is often virtually impossible to reliably identify who the “California” consumers are. Thereby making it by practical necessity a global requirement for all publicly facing systems and applications for all users.
We recommend that most companies prioritize and stage their compliance today, focusing on GDPR in the short term, but a California (or potentially necessary practical nationwide) compliance strategy should be included in late 2018 and 2019 IT and Privacy compliance plans.
Seyfarth Shaw Offers Data Privacy & Protection in the EU-U.S. Desktop Guide and On-Demand Webinar Series
On May 25, 2018, the EU General Data Protection Regulation (“GDPR”) will impose significant new obligations on all U.S. companies that handle personal data of any EU individual. U.S. companies can be fined up to €20 million or 4% of their global annual revenue for the most egregious violations. What does the future passage of GDPR mean for your business?
Seyfarth’s eDiscovery and Information Governance (eDIG) and Global Privacy and Security (GPS) practitioners are pleased to announce the release of Data Privacy & Protection in the EU-U.S.: What Companies Need to Know Now, which describes GDPR’s unique legal structure and remedies, and includes tips and strategies in light of the future passage of the GDPR.
How to Get Your Desktop Guide:
To request the Data Privacy & Protection in the EU-U.S. Desktop Guide as a pdf or hard copy, please click the button below:
GDPR Webinar Series
Throughout August and October of 2017, Seyfarth Shaw’s attorneys provided high-level discussions on risk assessment tools and remediation strategies to help companies prepare and reduce the cost of EU GDPR compliance. Each segment is one hour long and can be accessed on-demand at Seyfarth’s Carpe Datum Law Blog and The Global Privacy Watch Blog.
Cross Posted from California Peculiarities Employment Law Blog
Hernandez v. Sprouts Farmers Market, Inc., a case stemming from a phishing scam, emphasizes the need for California employers to implement comprehensive data protection and data breach notification policies and practices for personal employee information under the CDPA.
A story of a company suffering a data breach tops newspaper headlines almost daily. So how can you stay out of the “fuego,” and stay compliant with California laws about your employees’ and customers’ data?
California’s Data Protection Act—“Army Of One”
In 2003 California passed the nation’s first data breach notification statute: the CDPA. Since then, over 30 states have enacted similar statutes, but California remains the national leader in privacy and data security standards.
The CDPA mandates that any business that “owns or licenses personal information about a California resident shall implement and maintain reasonable security procedures and practices appropriate to the nature of the information, to protect the personal information from unauthorized access, destruction, use, modification, or disclosure.” And it requires a company to notify affected individuals of a data breach “in the most expedient time possible and without unreasonable delay.” Continue Reading Phishing: Data Breach Is “Chalkdust Torture”
With the FTC’s 2015 report “Internet of Things: Privacy & Security in a Connected World” (“Report”) the idea that more than just computers and phones are able to connect to the Internet. In fact, the Report states that the “IoT explosion is already around us.” This is true, and the Report goes on to describe some of the more interesting things that can be connected to the Internet which most of us don’t think about (e.g. smart health trackers, smoke detectors, and light bulbs). However, how vast is the actual IoT? And what does that mean to businesses? Continue Reading How Far Does the “Internet of Things” Reach?
The plethora of security incidents in the news have once again put security front and center of the international agenda. Predictably, this has triggered a number of responses from governments around the world. Some of these responses seem to have been ill-considered. However, one of the more comprehensive responses came out of the US President’s address to the Federal Trade Commission last week. A series of laws were proposed to address the increasing risks which are confronting individual security and privacy rights.
The President’s remarks at the FTC gives some valuable insight into where the US regulatory environment may end up in the next year or so. As a part of this analysis, one should focus on two very different agendas: Privacy and Security. These issues, while similar, are very different. Case in point, the UK PM’s comment around banning encryption could well result in increased security. However, it will absolutely damage individual privacy (and arguably also damage commercial security). Continue Reading Privacy & Security Are Back on the Agenda in DC
A company faced with a security breach has a lengthy “to do” list, things to accomplish with respect to its incident response plan. It must, among other things, determine the root cause of the vulnerability or breach, investigate and eliminate the vulnerability or breach, determine the full nature and extent of the breach, determine who to notify and finalize the notifications.
If the American Postal Workers Union (APWU) has its way, a unionized employer facing a security breach involving employee personal information would have yet another responsibility – bargaining over the impact of or response to the security breach. Continue Reading Union Files NLRB Complaint Regarding the USPS’ Handling of Security Breach Involving Employee Personal Information
This week, the Connecticut Supreme Court issued an opinion which upheld a state common law negligence action against a healthcare provider for violation of privacy and confidentiality laws and regulations using as evidence of the standard of care the Health Information Portability and Accountability Act (HIPAA) and its accompanying regulations. The court denied defense arguments that HIPAA, which expressly does not provide a private right of action, preempts such state law negligence claims. Continue Reading Connecticut Supreme Court Grants Private Action for HIPAA Breach
The White House released a set of reports this month on Big Data and the privacy implications of Big Data. While a number of folks have been discussing the President’s Council of Advisors on Science & Technology (“PCAST”) report, I would offer that the Office of Science and Technology Policy (“OSTP”) report needs to be read in conjunction with the PCAST report. They do two different things. One is a report on the technical state of affairs, and the other is more of a policy direction piece, which is driven by the technologically-oriented findings. Various points-of-view have been put forth as to the relative merits of each report, but there seems to be an important element missing from both reports. Both reports discuss the need for policy decisions to be based on context and on desired outcomes. Unfortunately, neither report really gives a good taxonomy around the informatics ecosystem to allow for a clear path forward on “context” and “desired outcomes”. What I mean by this is best summed up in the comment in the PCAST report which states: “In this report, PCAST usually does not distinguish between “data” and “information”.”. “Data” and “Information” are very different things, and one really can’t have a coherent policy discussion unless the distinction between the two is recognized and managed. Continue Reading How to Talk About Big Data: A Framework
When talking about EU privacy law many businesses bemoan the lack of a “commercially reasonable” basis for collecting and using personal information. Europe is usually seen as a consumer-protective regime which focuses on prohibiting business from doing anything with data unless the consumer has affirmatively agreed to the processing before the processing begins (e.g. the “cookie directive”). However, the Article 29 Working Party (“WP”) has just released an Opinion which signals a change in the winds. The rarely used “legitimate interest of the data controller” basis for processing now has a new importance in the realm of fair and legal criteria for processing personal information. Continue Reading On Balance – the Legitimate Interest of a Controller