A new ballot initiative would create the California Privacy Rights and Enforcement Act (“CPREA”) and would make several changes to the California Consumer Privacy Act (“CCPA”).

CPREA makes the following changes and additions:

  • California Privacy Protection Agency: This ballot initiative would establish the California Privacy Protection Agency (“CPPA”), which would be comprised of five members appointed by members of the California government. The CPPA would be tasked with adopting rules, appointing a Chief Privacy Auditor who would proactively audit businesses for compliance, and bringing enforcement actions.
  • Additional Disclosures: CPREA would require that businesses tell consumers whether they profile them in certain circumstances (such as where profiling is reasonably expected to have an effect on financial loans or education admissions), together with the “logic involved” in using personal information for such profiling. Additionally, businesses that use personal information for political purposes would also be subject to specific disclosure obligations, including identification of the candidates, committees, or ballot measures for which personal information is used.
  • Amended Definition of Sale: Notably, the CPREA would define “sale” to include transfers of personal information not only for monetary or other valuable consideration, but also disclosures “otherwise for a commercial purpose, including but not limited to cross-context behavioral advertising.” This edit is similar to the broader “sale” definition proposed in the original ballot initiative, which did not require any consideration and was explicitly rejected by the California legislature. “Cross-context behavioral advertising” is defined as the “targeting of advertising to a consumer based on a profile of the consumer including predictions derived from the consumer’s personal information, where such profile is related to the consumer’s activity over time and across multiple businesses or across multiple, distinctly-branded websites, application, or services.” For consumers who opt-out of the sale of their personal information or opt-out of the use or disclosure of personal information for advertising and marketing, the ballot initiative would require businesses to wait for at least 12 months before requesting authorization to sell, or use and disclose, the consumer’s personal information.
  • Sensitive Personal Information: CPREA creates a new category of “sensitive personal information.” CPREA provides consumers with the right to opt-out of the use or disclosure of their sensitive personal information “for advertising and marketing,” which is defined to include communications intended to induce a consumer to buy, rent, lease, join, use, subscribe to, apply for, provide, or exchange products, goods, property, information, services, or employment. “Sensitive information” includes (for example) financial information, health information, race and religion, and precise geolocation information. Notably, sensitive information already is heavily regulated under other federal and state privacy laws.
  • Heightened Protection for Consumers under 16 years of age: Businesses would not be permitted to collect personal information of consumers less than 16 without opt-in consent if the business has actual knowledge that the consumer is less than 16.
  • Creates New Regulated Entities and Relationships: The CPREA introduces the role of a “contractor.” The ballot initiative would require that contractors be subject to contractual restrictions, including prohibitions on the sale of personal information, restrictions on retaining and using personal information, and certifications to the business.
  • Private Right of Action: As drafted, the private right of action is available for certain data breaches that result from unreasonable security practices and only if a business does not cure the “violation” within 30 days’ notice by a plaintiff. CPREA would expressly state that the implementation and maintenance of reasonable security procedures and practices following a breach would not constitute a cure that would serve as a defense to a claim.

The author of the ballot initiative intends to include this proposal on the November, 2020 ballot.

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Photo of Libbie Canter Libbie Canter

Libbie Canter represents a wide variety of multinational companies on privacy, cyber security, and technology transaction issues, including helping clients with their most complex privacy challenges and the development of governance frameworks and processes to comply with global privacy laws. She routinely supports…

Libbie Canter represents a wide variety of multinational companies on privacy, cyber security, and technology transaction issues, including helping clients with their most complex privacy challenges and the development of governance frameworks and processes to comply with global privacy laws. She routinely supports clients on their efforts to launch new products and services involving emerging technologies, and she has assisted dozens of clients with their efforts to prepare for and comply with federal and state privacy laws, including the California Consumer Privacy Act and California Privacy Rights Act.

Libbie represents clients across industries, but she also has deep expertise in advising clients in highly-regulated sectors, including financial services and digital health companies. She counsels these companies — and their technology and advertising partners — on how to address legacy regulatory issues and the cutting edge issues that have emerged with industry innovations and data collaborations.

As part of her practice, she also regularly represents clients in strategic transactions involving personal data and cybersecurity risk. She advises companies from all sectors on compliance with laws governing the handling of health-related data. Libbie is recognized as an Up and Coming lawyer in Chambers USA, Privacy & Data Security: Healthcare. Chambers USA notes, Libbie is “incredibly sharp and really thorough. She can do the nitty-gritty, in-the-weeds legal work incredibly well but she also can think of a bigger-picture business context and help to think through practical solutions.”

Photo of Lindsey Tonsager Lindsey Tonsager

Lindsey Tonsager co-chairs the firm’s global Data Privacy and Cybersecurity practice. She advises clients in their strategic and proactive engagement with the Federal Trade Commission, the U.S. Congress, the California Privacy Protection Agency, and state attorneys general on proposed changes to data protection…

Lindsey Tonsager co-chairs the firm’s global Data Privacy and Cybersecurity practice. She advises clients in their strategic and proactive engagement with the Federal Trade Commission, the U.S. Congress, the California Privacy Protection Agency, and state attorneys general on proposed changes to data protection laws, and regularly represents clients in responding to investigations and enforcement actions involving their privacy and information security practices.

Lindsey’s practice focuses on helping clients launch new products and services that implicate the laws governing the use of artificial intelligence, data processing for connected devices, biometrics, online advertising, endorsements and testimonials in advertising and social media, the collection of personal information from children and students online, e-mail marketing, disclosures of video viewing information, and new technologies.

Lindsey also assesses privacy and data security risks in complex corporate transactions where personal data is a critical asset or data processing risks are otherwise material. In light of a dynamic regulatory environment where new state, federal, and international data protection laws are always on the horizon and enforcement priorities are shifting, she focuses on designing risk-based, global privacy programs for clients that can keep pace with evolving legal requirements and efficiently leverage the clients’ existing privacy policies and practices. She conducts data protection assessments to benchmark against legal requirements and industry trends and proposes practical risk mitigation measures.

Photo of Jayne Ponder Jayne Ponder

Jayne Ponder provides strategic advice to national and multinational companies across industries on existing and emerging data privacy, cybersecurity, and artificial intelligence laws and regulations.

Jayne’s practice focuses on helping clients launch and improve products and services that involve laws governing data privacy…

Jayne Ponder provides strategic advice to national and multinational companies across industries on existing and emerging data privacy, cybersecurity, and artificial intelligence laws and regulations.

Jayne’s practice focuses on helping clients launch and improve products and services that involve laws governing data privacy, artificial intelligence, sensitive data and biometrics, marketing and online advertising, connected devices, and social media. For example, Jayne regularly advises clients on the California Consumer Privacy Act, Colorado AI Act, and the developing patchwork of U.S. state data privacy and artificial intelligence laws. She advises clients on drafting consumer notices, designing consent flows and consumer choices, drafting and negotiating commercial terms, building consumer rights processes, and undertaking data protection impact assessments. In addition, she routinely partners with clients on the development of risk-based privacy and artificial intelligence governance programs that reflect the dynamic regulatory environment and incorporate practical mitigation measures.

Jayne routinely represents clients in enforcement actions brought by the Federal Trade Commission and state attorneys general, particularly in areas related to data privacy, artificial intelligence, advertising, and cybersecurity. Additionally, she helps clients to advance advocacy in rulemaking processes led by federal and state regulators on data privacy, cybersecurity, and artificial intelligence topics.

As part of her practice, Jayne also advises companies on cybersecurity incident preparedness and response, including by drafting, revising, and testing incident response plans, conducting cybersecurity gap assessments, engaging vendors, and analyzing obligations under breach notification laws following an incident.

Jayne maintains an active pro bono practice, including assisting small and nonprofit entities with data privacy topics and elder estate planning.