California data privacy bill heads to Gov. Jerry Brown

Bob Hertzberg
The Associated Press

SACRAMENTO, Calif. (AP) — A California internet privacy bill that experts call the nation’s most far-reaching effort to give consumers more control over their data is headed to Gov. Jerry Brown after passing the Legislature on Thursday.

Under the bill, companies would have to comply with consumer requests to say what data they’ve collected, why it was collected and what categories of third parties have received it. They’d have to delete the information or refrain from selling it if consumers ask.

It’s similar to data privacy regulation in the European Union, which aims to give consumers some control over how companies use their data. The bill would apply only to California consumers. However, internet users in other states will likely see changes if it becomes law, said Cynthia Larose, a cybersecurity expert at the law firm Mintz Levin.

“It’s going to be impractical for companies to maintain two separate sets of privacy protections: One for California and one for everyone else,” she said.

California lawmakers’ actions come amid a national debate over how companies handle users’ data, prompted by large breaches in recent years at companies including Target and Equifax. Facebook also has faced intense scrutiny after news broke that Republican-linked consulting firm Cambridge Analytica collected data from millions of Facebook users without their knowledge.

The bill would give companies the ability to offer discounts to customers who allow their data to be sold and could charge those who opt out a reasonable amount based on how much the company makes selling the information.

It passed the Legislature with no dissenting votes.

Lawmakers scrambled to pass it so that a San Francisco real estate developer removes a similar initiative from the November ballot.

The deadline to remove initiatives is Thursday.

The bill, AB375 by Assemblyman Ed Chau, would also bar companies from selling data from children younger than 16 without consent.

“We in California are taking a leadership position with this bill,” said Sen. Bob Hertzberg, a Van Nuys Democrat who co-authored the bill. “I think this will serve as an inspiration across the country.”

Voter-enacted initiatives are much harder to alter than laws passed through the legislative process. Given the significance and complexity of the proposed policy, supporters and even many opponents said they wanted legislators to pass the bill so they can more easily change it in the future.

Lawmakers suggested the bill will need amendments.

Republican Assemblyman Jay Obernolte said thinks providing allowing people to sue companies over data breaches are too broad.

Opponents said although the bill is aimed at regulating internet and tech companies, some say it could have unintended consequences on other industries. A lobbyist for the newspaper industry, for example, said Wednesday he worried the bill could harm news reporting by allowing subjects of negative investigative stories to prevent publication. Lawmakers said that’s not the bill’s intent.

San Francisco real estate developer Alastair Mactaggart spent $3 million to support the related initiative and qualify it for the ballot. If the bill fails, he said he’ll push forward with the initiative.