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Federal Privacy Legislation Advances in House


SPB Partner Beth Goldstein also contributed to this post.

With the powerful Committee on Energy and Commerce having approved a comprehensive, bipartisan privacy bill by a vote of 53-2, the US House of Representatives is one step closer to approving historic privacy legislation after over a decade of debate. Before formally reporting the legislation to the full House, the Committee adopted a substitute amendment that addressed concerns that had been raised in Subcommittee a few weeks ago. Among other provisions, the substitute amendment included the following changes:

  • The amended ADPPA provides an explicit right for the California Privacy Protection Agency (“CPPA”) to enforce the law. This is likely in response to calls by California Governor Newsom and the CPPA itself this week to eliminate the bill’s would-be preemption of the California Consumer Privacy Act (including as amended by the California Privacy Rights Act) (“CCPA”). Notably, however, preemption of the CCPA remains.
  • The definition of “third party” has been amended to provide that affiliated companies are considered a single covered entity if consumers reasonably expect them to share information with one another.
  • The substitute amendment provides a number of additional changes with respect to targeted advertising, including :
    • The FTC has the authority to establish global privacy control or “unified opt-out mechanisms” to allow individuals to opt out from targeted advertising.
    • The ADPPA retains its ban on targeted ads to an individual under 17, and also still considers information relating to such individuals as sensitive covered data, but has introduced a tiered knowledge approach with respect to an individual’s age
    • Internet browsing history over time and across third party websites or online services is now considered sensitive data.
  • Sensitive covered data has been further expanded to include race, color, ethnicity, religion, and union membership, and video data as a category of sensitive covered data has been clarified to include information showing the video content requested or selected by users of consumer generated media.

The leadership of the Committee appears to have found the sweet spot on the two major issues that have bedeviled legislators for years—how and to what extent to preempt state law and the extent to which consumers can vindicate their rights through a private right of action. The substitute amendment, for example, shortened from four year to two years after the date of enactment the date by which consumers can sue over alleged privacy violations. In addition, the substitute amendment limited forced arbitration agreements with respect to claims made by individuals facing domestic violence. With preemption and the private right of action now largely resolved, only a few additional minor issues, plus further changes to the arbitration provision, appear to stand in the way of likely House passage of the bill in September, if not before the August recess begins, on a bipartisan basis.

 



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