Patchwork of State Privacy Laws

Earlier this year, we wrote about the European Union’s General Data Protection Regulation (GDPR) and how California was following suit by passing the California Consumer Privacy Act (CCPA). This law will come into effect on January 1, 2020. 

The CCPA protects California residents by providing heightened privacy rights and consumer protection regarding the collection of their personal data online.  While California residents are the protected class, businesses nationwide will be affected by the CCPA.  Any company whose website is accessed by California residents is subject to the requirements of the CCPA.  Potential damages for violation of the CCPA include statutory or actual damages, as well as fines for intentional and unintentional violations; therefore, it is imperative that businesses ensure their websites, privacy policies, and data collection procedures are compliant with the CCPA as soon as possible.

Additionally, a patchwork of states have started drafting and passing privacy laws in the CCPA’s wake. The infographic above shows which states are proposing and passing new legislation.

One of the two states that has officially passed a data privacy law is Nevada.  Although only passed in May of this year, it will be effective a full three months earlier than the CCPA, October 1, 2019.  This law appears narrower than the CCPA, as it specifically addresses a consumer’s right to opt out of the sale of their personal information, while the CCPA covers the whole gamut of an individual’s rights to data.  Additionally, this bill does not include a private right of action, but rather relies on the Attorney General to enforce it. We are not at all shocked that Nevada would be one of the earliest adopters of additional privacy legislation, however. What happens in Vegas, stays in Vegas.

The other early actor is Maine, whose governor signed one of the strictest internet privacy protection bills into law just this month. Maine’s new privacy law, which goes into effect on July 1, 2020, will require internet service providers to seek consent from their consumers before selling or sharing their personal information with any third party.  Critics have attacked this law on various grounds, arguing that the law conflicts with federal laws, the U.S. Constitution’s Interstate Commerce Clause, and even the right of free speech.  Yikes.  We’re interested to see how these challenges will play out in the courts.

Five additional states have proposed legislation.  All of these proposed bills have pros and cons, but we will look into them in more depth as they progress.

  • New York has proposed a broadly worded bill regarding privacy that includes imposing an obligation on companies as a “data fiduciary” and allows for a private right of action. We expect such an aggressive bill to get some pushback, as a fiduciary duty is a very high obligation.
  • Maryland’s proposal incorporates the CCPA’s prohibition on discriminating against those who exercise their individual rights to data access or deletion (which was one of the big changes from the GDPR to the CCPA) and shares many characteristics with the CCPA. This bill does not allow for a private right of action.
  • Massachusetts’ proposed bill allows for a private right of action for consumers who have had their personal information “improperly collected.” It also prohibits discrimination where consumers have exercised their associated privacy rights.
  • Hawaii’s proposed legislation currently has no definition for “business,” which will hopefully be remedied before its passage. It also does not include a private right of action . . . or any penalties for violations.
  • New Mexico’s proposed bill includes many key individual rights addressed in the CCPA, such as the right to access and deletion of personal information.

Additionally, Mississippi, Washington, and Texas all attempted to pass legislation this year that addressed consumer privacy.  While these bills did not make it through the legislatures, these states are participating in active discussions, which is just more inspiration for the remaining states.

A federal law may soon address this developing patchwork of state laws.  As early as November 2018, various House and Senate Committees held hearings and drafted federal legislation regarding consumer data protection. We expect to hear more from Washington D.C. by August 2019, but again, we’ll keep you posted.

– Kat Gavin, Esq.

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