Privacy & Information Security Law Blog

UPDATE: On September 25, 2020, California Governor Gavin Newsom vetoed SB-980.

On August 31, 2020, the California Senate joined the Assembly in passing SB-980, as amended, a bill to establish the Genetic Information Privacy Act (the “Act”), which would require direct-to-consumer genetic testing companies to comply with certain privacy and data security provisions, including providing consumers with prescribed notice; obtaining consumers’ express consent regarding the collection, use and disclosure of genetic data; and enabling consumers to access and delete their genetic data. The bill is pending California Governor Gavin Newsom’s signature.

On August 30, 2020, the California legislature passed AB-1281. As background, the California Consumer Privacy Act of 2018 (“CCPA”) currently exempts from most of its requirements certain information collected in the HR context and certain information collected about B2B personnel. Each exemption is scheduled to sunset on January 1, 2021. As we previously reported, the California Privacy Rights Act (“CPRA”) ballot initiative, if passed during the state’s November 3, 2020 general election, would extend the CCPA’s HR and B2B exemptions to January 1, 2023 ...

On August 14, 2020, the California Attorney General announced that the California Office of Administrative Law (“OAL”) approved the final regulations issued under the California Consumer Privacy Act of 2018 (“CCPA”) and filed them with the California Secretary of State. As we previously reported, the California Attorney General submitted the draft regulations to the OAL on June 1, 2020, and requested that the regulations become effective on the same day they are filed with the Secretary of State. The OAL has complied with that request, and the regulations go into effect ...

Earlier this year, The Retail Equation, a loss prevention service provider, and Sephora were hit with a class action lawsuit in which the plaintiff claimed Sephora improperly shared consumer data with The Retail Equation without consumers’ knowledge or consent. The plaintiff claimed The Retail Equation did so to generate risk scores that allegedly were “used as a pretext to advise Sephora that attempted product returns and exchanges are fraudulent and abusive.”

On July 27, 2020, the Enforcement Bureau of the Federal Communications Commission (the “FCC”) designated the Industry Traceback Group (“ITG”) as the FCC’s official consortium for coordinating efforts to trace illegal robocalls. The ITG is a collaboration of wireline, wireless, VoIP and cable industry companies, led by USTelecom, with the mission of tracing and identifying the source of illegal robocalls. According to the ITG, it conducted more than 1,000 trace-back operations in 2019 and unmasked the source of more than 10 million robocalls.

On Wednesday, July 22, the New York Department of Financial Services (the “NYDFS”) announced that it had filed administrative charges against First American Title Insurance Co. under the NYDFS Cybersecurity Regulation, marking the agency’s first enforcement action since the rules went into effect in March 2017.

On June 24, 2020, the Washington State Attorney General (“Washington AG”) announced that it had settled an enforcement action against the owners of the “We Heart It” social media platform for alleged violations of the Children’s Online Privacy Protection Act (“COPPA”) and the Washington State Consumer Protection Act. Under the consent decree, the defendants must pay $100,000, with an additional $400,000 suspended contingent upon compliance with the consent decree.

On July 1, 2020, the California Consumer Privacy Act of 2018 (“CCPA”) became enforceable by the California Attorney General. Under the statute, businesses are granted 30 days to cure any alleged violations of the law after being notified of alleged noncompliance. If a business fails to cure the alleged violation, it may be subject to an injunction and liable for a civil penalty of up to $2,500 for each violation or $7,500 for each intentional violation.

According to a memorandum issued by the California Secretary of State on June 24, 2020, the California Privacy Rights Act (“CPRA”) has garnered enough signatures to be placed on the State’s General Election ballot this November 3, 2020. As we previously reported, the CPRA would amend the California Consumer Privacy Act of 2018 (“CCPA”) to create new and additional privacy rights and obligations in California. According to early polling by Californians for Consumer Privacy (the group behind the CPRA), nine in 10 Californians would vote to support a ballot measure ...

On June 9, 2020, the Federal Communications Commission (“FCC”) announced a proposed $225 million fine, the largest in the history of the FCC, against several individuals for telemarketing violations.

On May 4, 2020, Californians for Consumer Privacy (the group behind the ballot initiative that inspired the California Consumer Privacy Act of 2018 (“CCPA”)) announced that it had collected over 900,000 signatures to qualify the California Privacy Rights Act (“CPRA”) for the November 2020 ballot. The group announced that it was taking steps to submit the CPRA for inclusion on the November ballot in counties across California. The CPRA would amend the CCPA to create new and additional privacy rights and obligations in California, including the following:

On April 30, 2020, Senator Roger Wicker (MS), Chairman of the Senate Commerce Committee, along with Senators John Thune (SD), Jerry Moran (KS) and Marsha Blackburn (TN), announced plans to introduce the COVID-19 Consumer Data Protection Act of 2020 (“the bill”), which would put temporary rules in place regarding the collection, processing and transfer of data used to combat the spread of the coronavirus. The bill would only apply during the course of the COVID-19 Public Health Emergency as declared by the Secretary of Health and Human Services, and would only apply to specific uses of certain personal data.

California Attorney General (“AG”) Xavier Becerra recently issued an alert emphasizing the rights of California consumers under the California Consumer Privacy Act (“CCPA”) during the COVID-19 pandemic. The alert follows media reports that the AG’s office is “committed to enforcing the law upon finalizing the rules or [by] July 1, whichever comes first,” even with the “new reality created by COVID-19.”

On April 14, 2020, the Indiana Attorney General’s office announced that the state had reached a settlement agreement with Equifax in connection with Equifax’s 2017 data breach. Under the terms of the settlement, Equifax will pay a $19.5 million penalty. Indiana previously elected not to participate in a July 2019 multistate and Federal Trade Commission settlement with Equifax regarding the same data breach.

As of early April, hundreds of millions of workers around the world have been affected by “stay-at-home” or “station-in-place” orders issued by governments in response to the COVID-19 pandemic. To cope, transaction processors are shifting work out of their high-security delivery centers and into the spare bedrooms and home offices of their personnel. That shift creates security challenges that have chief information security officers’ (“CISOs’”) heads spinning. Specifically, special challenges are created when work-from-home (“WFH”) orders affect payment cardholder data that is subject to the Payment Card Industry’s Data Security Standard (“PCI DSS”).

Listen as Phyllis H. Marcus, partner at Hunton Andrews Kurth and Co-Chair of the ABA Antitrust Law Section’s Privacy and Information Security Committee, speaks about the privacy concerns over using smart devices on the ABA’s Our Curious Amalgam podcast, Is Your Assistant Spying on You? Understanding the Privacy Law Issues Involving In-Home Assistants.

On April 2, 2020, Hunton Andrews Kurth LLP will host a webinar on the California Consumer Privacy Act (“CCPA”): The CCPA Is Here—Are You Litigation-Ready? Most companies have now developed a framework for compliance with the CCPA. Having a compliance program in place is critical, and that includes preparing for the inevitable onslaught of class action litigation that is coming.

The Spanish Data Protection Authority (the “AEPD”) recently published a report on data processing activities carried out by data controllers in the private and public sectors as a result of the spread of the COVID-19 virus (the “Report”).

On March 21, 2020, the data security provisions of New York’s Stop Hacks and Improve Electronic Data Security Act (“SHIELD Act”) went into effect. The SHIELD Act requires any person or business owning or licensing computerized data that includes the private information of a resident of New York (“covered business”) to implement and maintain reasonable safeguards to protect the security, confidentiality and integrity of the private information.

On March 12, 2020, the Washington State Legislature passed SB 6280, which establishes safeguards for the use of facial recognition technology by state and local government agencies. Its stated goal is to allow the use of facial recognition services in ways that benefit society, but prohibit uses that put freedoms and civil liberties at risk.

On March 10, 2020, the Vermont Attorney General filed a lawsuit against Clearview AI (“Clearview”), alleging that Clearview violated Vermont’s consumer protection law and data broker law. We previously reported on Vermont’s data broker law, which was the first data broker legislation in the U.S.

On March 12, 2020, Senator Jerry Moran (KS) introduced a comprehensive federal privacy bill entitled the Consumer Data Privacy and Security Act of 2020 (the “Act”).

Hunton’s Centre for Information Policy Leadership (“CIPL”) reports on the top privacy-related priorities for this year:

1.  Global Convergence and Interoperability between Privacy Regimes

Around the world, new privacy laws are coming into force and outdated laws continue to be updated: the EU General Data Protection Regulation (“GDPR”), Brazil’s Lei Geral de Proteção de Dados Pessoais (“LGPD”), Thailand’s Personal Data Protection Act, India’s and Indonesia’s proposed bills, California’s Consumer Privacy Act (“CCPA”), and the various efforts in the rest of the United States at the federal and state levels. This proliferation of privacy laws is bound to continue.

The meaning of an “automatic telephone dialing system” (“ATDS”) as defined by the Telephone Consumer Protection Act (“TCPA”) has been hotly contested since the D.C. Circuit invalidated the prior Federal Communications Commission (“FCC”) rulings interpreting the TCPA in 2018. The Ninth Circuit has held that merely calling numbers from a stored list is sufficient to meet the definition of an ATDS, while the Third Circuit has at least indicated that the ability to generate numbers randomly or sequentially is the defining characteristic.

At this point, most companies doing business in California are aware of the California Consumer Privacy Act (“CCPA”), and most have been bracing for the eventual onslaught of class action litigation to follow its passage.

On February 1, 2020, the Italian Data Protection Authority (Garante per la protezione dei dati personali, the “Garante”) announced that it had levied a fine of €27,802,946 on TIM S.p.A. (“TIM”), a telecommunications company, for several unlawful marketing data processing practices. Between 2017 and 2019, the Garante received numerous complaints from individuals (including from individuals who were not existing customers of TIM) claiming that they had received unwanted marketing calls, without having provided their consent or despite having registered on an opt-out list. The Garante indicated that the violations impacted several million individuals.

On January 16, 2020, the Federal Trade Commission announced that settlements with five companies of separate allegations that they had falsely claimed certification under the EU-U.S. Privacy Shield framework had been finalized.

2019 was the “Year of the CCPA” as companies around the world worked tirelessly to comply with the California Consumer Privacy Act of 2018 (“CCPA”). The CCPA aims to provide data privacy rights for California residents and imposes significant new requirements on covered businesses.

On January 8, 2020, the Information Commissioner's Office (“ICO”) launched a consultation on its draft direct marketing code of practice (the “Draft Code”), as required by section 122 of the Data Protection Act 2018 (“DPA 18”). The Draft Code is open for public consultation until March 4, 2020.

On January 6, 2020, the Federal Trade Commission announced that it granted final approval to a settlement with InfoTrax Systems, L.C. and its former CEO, Mark Rawlins, related to allegations that InfoTrax failed to implement reasonable, low-cost and readily available security safeguards to protect the personal information the company maintained on behalf of its business clients.

In a January 6, 2020 blog post, the Director of the Federal Trade Commission’s Bureau of Consumer Protection reflected on how the FTC has taken action over the past year to strengthen its orders in data security cases. These orders have been a subject of focus for the FTC: in June 2018, the 11th Circuit’s LabMD decision struck down an FTC data security order as unenforceably vague, and the FTC subsequently held a hearing in the course of the FTC’s Hearings on Competition and Consumer Protection in the 21st Century on how it could improve data security orders.

On December 18, 2019, the House Energy and Commerce Committee released a bipartisan staff-level draft privacy bill (“the bill”). While comprehensive in scope, much of the key language in the bill was left in brackets, meaning the two sides have not yet reached a compromise on final language.

On December 6, 2019, the Federal Trade Commission announced its Final Order and Opinion in the matter of Cambridge Analytica, LLC, finding that Cambridge Analytica violated the FTC Act’s Section 5 prohibition against “unfair or deceptive acts or practices” when harvesting personal information through its “GSRApp” Facebook application.

On December 3, 2019, the Federal Trade Commission announced that it had reached settlements in four separate Privacy Shield cases. Specifically, the FTC alleged that Click Labs, Inc., Incentive Services, Inc., Global Data Vault, LLC, and TDARX, Inc. each falsely claimed to participate in the EU-U.S. Privacy Shield framework. The FTC also alleged that Click Labs and Incentive Services falsely claimed to participate in the Swiss-U.S. Privacy Shield framework and that Global Data and TDARX continued to claim participation in the EU-U.S. Privacy Shield after their Privacy Shield certifications lapsed. The complaints further alleged that Global Data and TDARX failed to comply with the Privacy Shield framework, including by failing to (1) verify annually that statements about their Privacy Shield practices were accurate, and (2) affirm that they would continue to apply Privacy Shield protections to personal information collected while participating in the program.

On November 29, 2019, Senator Roger Wicker (MS), Chairman of the Senate Commerce Committee, circulated a draft of a comprehensive federal privacy bill entitled the United States Consumer Data Privacy Act of 2019 (“the Bill”).

On November 26, 2019, Senate Commerce Committee Ranking Member Maria Cantwell (WA), alongside Senators Brian Schatz (HI), Amy Klobuchar (MN) and Ed Markey (MA), unveiled a new comprehensive federal privacy bill entitled the Consumer Online Privacy Rights Act (“COPRA”).

The bill would create a new bureau within the Federal Trade Commission  focusing on privacy and data security to enforce the law and promulgate new rules and regulations in the space. It also would provide enforcement authority for state attorneys general as well as a private right of action. It would preempt only state laws that “directly conflict with the provisions of the Act,” and specifically notes that state laws that afford a “greater level of protection to individuals” would not be considered in direct conflict.

On November 18, 2019, the ranking members from four Senate Committees (Senator Maria Cantwell (WA) from Commerce, Senator Dianne Feinstein (CA) from Judiciary, Senator Sherrod Brown (OH), and Senator Patty Murray (WA) from Health, Education, Labor and Pensions) released a set of “core principles” for federal privacy legislation.

On November 19, 2019, the Federal Trade Commission announced that Medable, Inc. (“Medable”) agreed to settle allegations that the company had misrepresented its participation in the EU-U.S. Privacy Shield program. The FTC alleged that, from December 2017 to October 2018, Medable falsely claimed in its online privacy policy that it was a certified participant in the EU-U.S. Privacy Shield framework and adhered to the framework’s principles. According to the complaint, although Medable did initiate an application with the Department of Commerce in December 2017, the company never completed the steps necessary to participate in the framework.

The European Data Protection Board recently published on its website that the Austrian Data Protection Authority (“Austrian DPA”) imposed an €18 million fine (approximately $20 million) on the Austrian Postal Service, Österreichische Post AG (“ÖPAG”), for various violations of the EU General Data Protection Regulation (“GDPR”). After conducting an investigation, the Austrian DPA established that ÖPAG unlawfully processed and sold data with respect to its customers’ alleged political affinities. Another GDPR violation was related to the ÖPAG’s ...

On October 21, 2019, the Federal Trade Commission took action against two companies alleged to have engaged in the business of false online reviews and social media influence. In the first case, the FTC entered into a consent decree with cosmetics marketer Sunday Riley, LLC, and the company’s owner, who sell products at Sephora stores and online at Sephora.com. According to the FTC’s complaint, disguised as ordinary consumers, Sunday Riley employees and Ms. Riley herself posted fake 5-star reviews of the company’s products on Sephora’s website. Under the terms of the FTC’s agreement, the company and its principal are barred from posting fake reviews, must clearly identify endorsers, and must instruct staff on their disclosure obligations. The FTC vote on the action was 3-2, with Commissioners Chopra and Slaughter dissenting on the grounds that the settlement did not include a monetary payment or an admission of guilt.

On October 22, 2019, the Federal Trade Commission announced that, for the first time, it has brought a case against a developer of “Stalking” Apps. The agency alleges that Retina-X Studios, and its owner, James N. Johns, Jr., developed and marketed three apps that allowed purchasers to surreptitiously monitor the movements and online activities of users of devices on which the apps were installed without the knowledge or permission of the device’s user. The FTC also alleges that the app developer took steps to ensure that a device user would not be aware that the app had been installed, bypassing mobile device manufacturers’ security restrictions and leaving the device vulnerable to cybersecurity risks. The apps were marketed as tools for monitoring the behavior of employees and children. The FTC further alleges that the app developer issued policies that made inaccurate representations regarding the security of their online systems, which were recently found to have been hacked twice during earlier incidents.

On October 11, 2019, California Governor Gavin Newsom signed into law AB 1130, which expands the types of personal information covered by California’s breach notification law to include, when compromised in combination with an individual’s name: (1) additional government identifiers, such as tax identification number, passport number, military identification number, or other unique identification number issued on a government document commonly used to verify the identity of a specific individual; and (2) biometric data generated from measurements or technical analysis of human body characteristics (e.g., fingerprint, retina, or iris image) used to authenticate a specific individual. Biometric data does not include a physical or digital photograph unless used or stored for facial recognition purposes.

On September 24, 2019, Alastair Mactaggart, drafter of the 2018 California ballot initiative that served as the basis for the California Consumer Privacy Act of 2018 (“CCPA”), announced that he is filing a new initiative for California’s November 2020 ballot, the California Privacy Enforcement Act (“CPEA”).

California marked the end of the 2019 legislative session this past Friday, September 13, by passing five out of six pending bills to amend the California Consumer Privacy Act of 2018 (“CCPA”). The bills – AB-25, AB-874, AB-1146, AB-1355 and AB-1564 – now head to California Governor Newsom’s desk for signature, which must occur by October 13 for the bills to be signed into law. The only pending bill not to pass was AB-846, which would have addressed the law’s application to customer loyalty programs; it was ordered to the inactive file at the request of Senator Jackson.

As an update to our previous blog posts, the FTC announced that it and the New York Attorney General reached a $170 million agreement with Google to resolve allegations that the company violated COPPA through its YouTube platform. Under the agreement, Google will pay $136 million to the FTC and $34 million to New York. The FTC voted 3-2 to authorize the action.

On August 29, 2019, the Maryland Insurance Administration issued new breach notification requirements for entities that provide health insurance or related services. The new requirements will apply to insurers, non-profit health plans, HMOs, third-party administrators, and certain other managed care entities. The new rules will take effect on October 1, 2019.

As an update to our previous blog post, according to media reports, Google has reached a settlement with the FTC in the range of $150 to $200 million over the agency’s investigation into the company’s alleged violations of COPPA through its YouTube platform. The settlement has not been announced by the FTC or Google, and the details of the settlement have not been made publicly available. These reports follow Google’s announcement earlier this week that it has created a separate YouTube Kids site, which will include different content for different age groups. This news also ...

On August 8, 2019, the FTC announced that Unrollme Inc. (“Unrollme”), an email management company, agreed to settle allegations the company deceived consumers about how it accesses and uses their personal emails. Unrollme offered users a service whereby the company would help unsubscribe users from unwanted subscription emails. In connection with this service, Unrollme required users to provide the company with access to their email accounts. The FTC alleged that Unrollme falsely told consumers it would not “touch” their personal emails. In fact, the FTC alleged, Unrollme shared its users’ email receipts (“e-receipts”) (i.e., emails sent to consumers following a completed transaction) with its parent company, Slice Technologies, Inc. The FTC’s complaint alleged that the parent company used information from the e-receipts (such as the user’s name, address, and information about products or services the individual purchased) for purposes of its own market research analytics products.

In addition to Facebook’s record-breaking Federal Trade Commission penalty and settlement order, on July 24, 2019, the Securities and Exchange Commission announced charges against Facebook for inadequate and misleading disclosures over its privacy practices. Facebook, without admitting or denying the SEC’s allegations, has agreed to the entry of a final judgment ordering a fine of $100 million.

As previously reported on July 12, 2019, Facebook will pay a $5 billion penalty to the Federal Trade Commission to resolve a privacy probe into whether Facebook violated a prior FTC consent decree requiring the company to better protect user privacy. The $5 billion penalty is the largest imposed on any company for violating consumers’ privacy – nearly 20 times the largest privacy or data security penalty to date.

On July 22, 2019, the Federal Trade Commission announced that Equifax Inc. (“Equifax”) agreed to pay at least $575 million, and potentially up to $700 million, as part of a global settlement agreement with the FTC, the Consumer Financial Protection Bureau (“CFPB”), and 48 U.S. states and territories to resolve investigations into the colossal data breach the company suffered in 2017. This is the largest data breach settlement in U.S. history.

According to media reports, the Federal Trade Commission has approved a multimillion dollar fine as part of a settlement with Google related to the FTC’s investigation into YouTube’s children’s data privacy practices. The FTC found that, in violation of COPPA, Google had failed to adequately protect children under 13 who used the video-streaming service and improperly collected their data.

A number of bills to amend the California Consumer Privacy Act of 2018 (“CCPA”) are still pending before the California legislature. Of particular interest to many businesses is AB 25. AB 25 would exempt from the CCPA’s application “[p]ersonal information collected by a business about a natural person in the course of the natural person acting as a job applicant to, an employee of, owner of, director of, officer of, medical staff member of, or contractor of that business” if the personal information is collected and used by the business solely within the context of the person’s role or former role as a job applicant to, an employee of, owner of, director of, officer of, medical staff member of, or a contractor of that business. The bill also would exempt from the CCPA’s application emergency contact information of these exempted categories of individuals and information necessary to administer benefits for persons related to such individuals.  Notably, AB 25 does not appear to exempt business-to-business customer representatives or representatives of other third-party business partners.  AB 25 also would authorize a business to require authentication of a consumer that is reasonable in light of the nature of the personal information requested. The bill further would authorize a business to require a consumer to submit the consumer’s verifiable request through the consumer’s account, where the consumer maintains an account with the business.

According to media reports, the Federal Trade Commission has approved a roughly $5 billion settlement with Facebook, Inc. to resolve a privacy probe investigating whether Facebook had violated a prior FTC consent decree requiring the company to better protect user privacy. The investigation followed reports that Cambridge Analytica improperly accessed the personal data of 87 million Facebook users.

On July 11, 2019, Washington Attorney General Bob Ferguson announced that his office had entered into a consent decree and $10 million settlement with Premera Blue Cross (“Premera”) that stems from a 2014-2015 breach that affected more than 11 million individuals. The settlement, which includes a payment of roughly $5.4 million to Washington state and $4.6 million to a coalition of 29 other state Attorneys General (the “Multistate AGs”), is one of the largest ever for a breach involving protected health information (“PHI”) and comes just one month after another notable HIPAA settlement involving a similar coalition of state AGs.

On July 2, 2019, the Federal Trade Commission announced a case involving the operator of an online rewards website who allegedly failed to take reasonable steps to secure consumers’ personal data.

On June 14, 2019, the Federal Trade Commission announced that it has taken action against a number of companies that allegedly misrepresented their compliance with the EU-U.S. and Swiss-U.S. Privacy Shield frameworks (collectively, the “Privacy Shield”) and other international privacy agreements.

Arizona Attorney General Mark Brnovich recently announced a settlement with healthcare software provider Medical Informatics Engineering Inc. (“MIE”) and its wholly owned subsidiary NoMoreClipboard, LLC. The settlement resolves a multistate litigation arising out of a May 2015 data breach in which hackers infiltrated WebChart, a web application run by MIE, and stole the electronic Protected Health Information (“ePHI”) of over 3.9 million individuals. Arizona and 15 other states (the “Multistate AGs”) filed the suit in December 2018, asserting claims under the federal Health Insurance Portability and Accountability (“HIPAA”) as well as various applicable state data protection laws. Notably, the lawsuit was the first-ever multistate litigation alleging claims under HIPAA.

On May 24, 2019, Oregon Governor Kate Brown signed Senate Bill 684 (the “Bill”) into law. The Bill, which takes effect January 1, 2020, amends the Oregon Consumer Identity Theft Protection Act (“OCITPA”) by enhancing the breach notification requirements applicable to third-party vendors.

On June 4, 2019, Hunton hosted a webinar with partners Lisa Sotto, Aaron Simpson, Brittany Bacon and Fred Eames on the evolving U.S. privacy landscape. The past year has seen highly consequential legislative developments in U.S. privacy law affecting compliance obligations for businesses that have or use consumer data. Various states and the U.S. Congress are considering bills that could transform privacy in the United States. In this program, our speakers discuss the California Consumer Privacy Act of 2018 (“CCPA”) and other significant state and federal privacy legislation.

On May 29, 2019, Nevada’s governor approved SB 220 (the “Amendment Bill”), which provides amendments to an existing law that requires operators of websites and online services (“Operators”) to post a notice on their website regarding their privacy practices. The Amendment Bill will require Operators to establish a designated request address through which a consumer may submit a verified request directing the Operator not to make any “sale” of covered information collected about the consumer. Pursuant to the Amendment Bill, Operators must respond to a verified opt-out request within 60 days of receipt.

On May 16, 2019, the California State Senate Appropriations Committee did not approve SB 561, a bill that would have amended the California Consumer Privacy Act (“CCPA”) to expand the private right of action to permit consumers to sue for any violations of the CCPA. The Committee’s decision to hold the bill means it will not pass out of the Senate this session.

As reported by Bloomberg Law, on May 7, 2019, Washington State Governor Jay Inslee signed a bill (HB 1071) amending Washington’s data breach notification law. The new requirements include the following:

• Expanded Definition of Personal Information. HB 1071 expands the definition of “personal information.” Washington’s breach notification law previously defined personal information as an individual’s name in combination with the individual’s Social Security number, state identification card number, or financial account or credit or debit card number in combination with any required security code, access code or password that would permit access to an individual’s financial account. HB 1071 adds the following data elements to the definition, when compromised in combination with an individual’s name:
  • full date of birth;
  • private key that is unique to an individual and that is used to authenticate or sign an electronic record;
  • student, military or passport identification number;
  • health insurance policy number or health insurance identification number;
  • any information about a consumer’s medical history or mental or physical condition or about a health care professional’s medical diagnosis or treatment of the consumer; or
  • biometric data generated by automatic measurements of an individual’s biological characteristics such as a fingerprint, voiceprint, eye retinas, irises or other unique biological patterns or characteristics that is used to identify a specific individual.

In late April, the California state legislature’s Privacy and Consumer Protection Committee held hearings on nine bills that seek to refine the California Consumer Privacy Act of 2018 (“CCPA”) by clarifying the legislation and limiting its scope. Eight bills advanced to the Assembly Appropriations Committee; the ninth is non-fiscal and will next be heard by the full Assembly. Last week, the California Assembly Appropriations Committee approved three of the bills. These bills, now on the Assembly’s “Consent Calendar,” will be heard this week. The Appropriations Committee will hold hearings on the other five bills in the next two weeks.

From the Assembly’s Appropriations Committee, bills must go through the full Assembly, the California Senate and the California governor to be enacted as law.

On April 24, 2019, the Federal Trade Commission announced two data security cases involving online operators—one, an online rewards website, and the second, a dress-up games website—that were alleged to have failed to take reasonable steps to secure consumers’ data, which allowed hackers to breach both websites.

Hunton Andrews Kurth LLP is pleased to announce the launch of a dedicated site focused on the California Consumer Privacy Act of 2018 (“CCPA”), which serves as a resource for businesses to understand and prepare to comply with the CCPA. Transformative in nature, the CCPA will impact most businesses that process the personal information of California residents, and is likely to set the stage for a wider shift in standards on data privacy across the United States.

During the week of April 1, 2019, the Centre for Information Policy Leadership (“CIPL”) at Hunton Andrews Kurth LLP hosted its annual executive retreat in Washington, D.C. (the “Retreat”). During the Retreat, CIPL held a full-day working session on evolving technologies and a new U.S. privacy framework followed by a closed members only half-day roundtable on global privacy trends with special guest Helen Dixon, Data Protection Commissioner of Ireland.

On February 22, 2019, California state senator Hannah Beth-Jackson introduced a bill (SB-561) that would amend the California Consumer Privacy Act of 2018 (“CCPA”) to expand the Act’s private right of action and remove the 30-day cure period requirement for enforcement actions brought by the State Attorney General. The bill would not change the compliance deadline for the CCPA, which remains January 1, 2020. California Attorney General Xavier Becerra supports the amendment bill, characterizing it as “a critical measure to strengthen and clarify the CCPA.”

On February 27, 2019, the U.S. Senate Committee on Commerce, Science and Transportation will hold a hearing titled “Privacy Principles for a Federal Data Privacy Framework in the United States.” The hearing will focus on potential Congressional action to “address risks to consumers and implement data privacy protections for all Americans.” Committee Chairman Sen. Roger Wicker described the hearing as an opportunity to “help set the stage for meaningful bipartisan legislation.”

On January 10, 2019, Massachusetts Governor Charlie Baker signed legislation amending the state’s data breach law. The amendments take effect on April 11, 2019.

In connection with its hearings on data security, the Federal Trade Commission hosted a December 12 panel discussion on “The U.S. Approach to Consumer Data Security.” Moderated by the FTC’s Deputy Director for Economic Analysis James Cooper, the panel featured private practitioners Lisa Sotto, from Hunton Andrews Kurth, and Janis Kestenbaum, academics Daniel Solove (GW Law School) and David Thaw (University of Pittsburgh School of Law), and privacy advocate Chris Calabrese (Center for Democracy and Technology). Lisa set the stage with an overview of the U.S. data security framework, highlighting the complex web of federal and state rules and influential industry standards that result in a patchwork of overlapping mandates. Panelists debated the effect of current law and enforcement on companies’ data security programs before turning to the “optimal” framework for a U.S. data security regime. Among the details discussed were establishing a risk-based approach with a baseline set of standards and clear process requirements. While there was not uniform agreement on the specifics, the panelists all felt strongly that federal legislation was warranted, with the FTC taking on the role of principal enforcer.

On December 4, 2018, the Federal Trade Commission published a notice in the Federal Register indicating that it is seeking public comment on whether any amendments should be made to the FTC’s Identity Theft Red Flags Rule (“Red Flags Rule”) and the duties of card issuers regarding changes of address (“Card Issuers Rule”) (collectively, the “Identity Theft Rules”). The request for comment forms part of the FTC’s systematic review of all current FTC regulations and guides. These periodic reviews seek input from stakeholders on the benefits and costs of specific FTC rules and guides along with information about their regulatory and economic impacts.

The Federal Trade Commission published the agenda for the ninth session of its Hearings on Competition and Consumer Protection in the 21st Century (“Hearings Initiative”), a wide-ranging series of public hearings. The ninth session, to take place on December 11-12, 2018, will focus on data security. Lisa Sotto, chair of Hunton Andrews Kurth’s Privacy and Cybersecurity practice, is one of five panel participants discussing “The U.S. Approach to Consumer Data Security.” The panel will be moderated by James Cooper, Deputy Director for Economic Analysis of the FTC’s ...

The Centre for Information Policy Leadership (“CIPL”) at Hunton Andrews Kurth LLP recently submitted formal comments to the U.S. Department of Commerce’s National Telecommunications and Information Administration (“NTIA”) in response to its request for public comments on developing the administration’s approach to consumer privacy.

On November 9, 2018, the European Commission (“the Commission”) submitted comments to the U.S. Department of Commerce’s National Telecommunications and Information Administration (“NTIA”) in response to its request for public comments on developing the administration’s approach to consumer privacy.

On November 8, 2018, Privacy International (“Privacy”), a non-profit organization “dedicated to defending the right to privacy around the world,” filed complaints under the GDPR against consumer marketing data brokers Acxiom and Oracle. In the complaint, Privacy specifically requests the Information Commissioner (1) conduct a “full investigation into the activities of Acxiom and Oracle,” including into whether the companies comply with the rights (i.e., right to access, right to information, etc.) and safeguards (i.e., data protection impact assessments, data protection by design, etc.) in the GDPR; and (2) “in light of the results of that investigation, [take] any necessary further [action]... that will protect individuals from wide-scale and systematic infringements of the GDPR.”

Effective November 2, 2018, a new Ohio breach law will provide covered entities a legal safe harbor for certain data breach-related claims brought in an Ohio court or under Ohio law if, at the time of the breach, the entity maintains and complies with a cybersecurity program that (1) contains administrative, technical and physical safeguards for the protection of personal information, and (2) reasonably conforms to one of the “industry-recognized” cybersecurity frameworks enumerated in the law.

On November 1, 2018, Senator Ron Wyden (D-Ore.) released a draft bill, the Consumer Data Protection Act, that seeks to “empower consumers to control their personal information.” The draft bill imposes heavy penalties on organizations and their executives, and would require senior executives of companies with more than one billion dollars per year of revenue or data on more than 50 million consumers to file annual data reports with the Federal Trade Commission. The draft bill would subject senior company executives to imprisonment for up to 20 years or fines up to $5 million, or both, for certifying false statements on an annual data report. Additionally, like the EU General Data Protection Regulation, the draft bill proposes a maximum fine of 4% of total annual gross revenue for companies that are found to be in violation of Section 5 of the FTC Act.

On October 19, 2018, the Federal Trade Commission announced that it released a paper on the Staff Perspective on the Informational Injury Workshop (the “Paper”), which summarized the outcomes of a workshop it hosted on December 12, 2017 to discuss and better understand “informational injuries” (i.e., harm suffered by consumers as a result of privacy and security incidents, such as data breaches or unauthorized disclosures of data) in an effort to guide (1) future policy determinations related to consumer injury and (2) future application of the “substantial injury” prong in cases involving informational injury.

As reported on the Insurance Recovery Blog, Hunton Andrews Kurth insurance practice head Walter Andrews recently commented to the Global Data Review regarding the infirmities underlying an Orlando, Florida federal district court’s ruling that an insurer does not have to defend its insured for damage caused by a third-party data breach.

Vizio, Inc. (“Vizio”), a California-based company best known for its internet-connected televisions, agreed to a $17 million settlement that, if approved, will resolve multiple proposed consumer class actions consolidated in California federal court. The suits’ claims, which are limited to the period between February 1, 2014 and February 6, 2017, involve data-tracking software Vizio installed on its smart TVs. The software allegedly identified content displayed on Vizio TVs and enabled Vizio to determine the date, time, channel of programs and whether a viewer watched live or recorded content. The viewing patterns were connected to viewer’s IP addresses, though never, Vizio emphasized in its press release announcing the proposed settlement, to an individual’s name, address, or similar identifying information. According to Vizio, viewing data allows advertisers and programmers to develop content better aligned with consumers’ preferences and interests.  

On September 26, 2018, the SEC announced a settlement with Voya Financial Advisers, Inc. (“Voya”), a registered investment advisor and broker-dealer, for violating Regulation S-ID, also known as the “Identity Theft Red Flags Rule,” as well as Regulation S-P, the “Safeguards Rule.” Together, Regulations S-ID and S-P are designed to require covered entities to help protect customers from the risk of identity theft and to safeguard confidential customer information. The settlement represents the first SEC enforcement action brought under Regulation S-ID.

The U.S. Department of Commerce’s National Institute of Standards and Technology recently announced that it is seeking public comment on Draft NISTIR 8228, Considerations for Managing Internet of Things (“IoT”) Cybersecurity and Privacy Risks (the “Draft Report”). The document is to be the first in a planned series of publications that will examine specific aspects of the IoT topic.

On September 26, 2018, the U.S. District Court for the District of Colorado ("the Court") refused to dismiss all putative class claims against Chipotle Mexican Grill, Inc. (“Chipotle”). This litigation arose from a 2017 data breach in which hackers stole customers’ payment card and other personal information by using malicious software to access the point-of-sale systems at Chipotle’s locations. 

On September 27, 2018, the Federal Trade Commission announced a settlement agreement with four companies - IDmission, LLC, (“IDmission”) mResource LLC (doing business as Loop Works, LLC) (“mResource”), SmartStart Employment Screening, Inc. (“SmartStart”), and VenPath, Inc. (“VenPath”) - over allegations that each company had falsely claimed to have valid certifications under the EU-U.S. Privacy Shield framework. The FTC alleged that SmartStart, VenPath and mResource continued to post statements on their websites about their participation in the Privacy Shield after allowing their certifications to lapse. IDmission had applied for a Privacy Shield certification but never completed the necessary steps to be certified.

On September 26, 2018, the U.S. Department of Commerce’s National Telecommunications and Information Administration (“NTIA”) announced that it is seeking public comments on a proposed approach to advancing consumer privacy. The approach is divided into two parts: (1) a set of desired user-centric privacy outcomes of organizational practices, including transparency, control, reasonable minimization (of data collection, storage length, use and sharing), security, access and correction, risk management and accountability; and (2) a set of high-level goals that describe the outlines of the ecosystem that should be created to provide those protections, including harmonizing the regulatory landscape, balancing legal clarity and the flexibility to innovate, ensuring comprehensive application, employing a risk and outcome-based approach, creating mechanisms for interoperability with international norms and frameworks, incentivizing privacy research, ensuring that the Federal Trade Commission has the resources and authority to enforce, and ensuring scalability.

On September 26, 2018, the U.S. Senate Committee on Commerce, Science, and Transportation convened a hearing on Examining Consumer Privacy Protections with representatives of major technology and communications firms to discuss approaches to protecting consumer privacy, how the U.S. might craft a federal privacy law, and companies’ experiences in implementing the EU General Data Protection Regulation (“GDPR”) and the California Consumer Privacy Act (“CCPA”).

Effective September 21, 2018, Section 301 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (the “Act”) requires consumer reporting agencies to provide free credit freezes and year-long fraud alerts to consumers throughout the country. Under the Act, consumer reporting agencies must each set up a webpage designed to enable consumers to request credit freezes, fraud alerts, extended fraud alerts and active duty fraud alerts. The webpage must also give consumers the ability to opt out of the use of information in a consumer report to send the consumer a ...

On August 30, 2018, Apple Inc. announced a June update to its App Store Review Guidelines that will require each developer to provide its privacy policy as part of the app review process, and to include in such policy specific content requirements. Effective October 3, 2018, all new apps and app updates must include a link to the developer’s privacy policy before they can be submitted for distribution to users through the App Store or through TestFlight external testing.

On August 22, 2018, California Attorney General Xavier Becerra raised significant concerns regarding the recently enacted California Consumer Privacy Act of 2018 (“CCPA”) in a letter addressed to the CCPA’s sponsors, Assemblyman Ed Chau and Senator Robert Hertzberg. Writing to “reemphasize what [he] expressed previously to [them] and [state] legislative leaders and Governor Brown,” Attorney General Becerra highlighted what he described as five primary flaws that, if unresolved, will undermine the intention behind and effective enforcement of the CCPA.

The Federal Trade Commission announced the opening dates of its Hearings on Competition and Consumer Protection in the 21st Century, a series of public hearings that will discuss whether broad-based changes in the economy, evolving business practices, new technologies or international developments might require adjustments to competition and consumer protection law, enforcement priorities and policy. The FTC and Georgetown University Law Center will co-sponsor two full-day sessions of hearings on September 13 and 14, 2018, to be held at the Georgetown University Law Center facility.

On August 15, 2018, U.S. District Judge Lucy Koh signed an order granting final approval of the record $115 million class action settlement agreed to by Anthem Inc. in June 2017. As previously reported, Judge Koh signed an order granting preliminary approval of the settlement in August 2017.

On August 6, 2018, the Federal Trade Commission published a notice seeking public comment on whether the FTC should expand its enforcement power over corporate privacy and data security practices. The notice, published in the Federal Register, follows FTC Chairman Joseph Simons’ declaration at a July 18 House subcommittee hearing that the FTC’s current authority to do so, under Section 5 of the FTC Act, is inadequate to deal with the privacy and security issues in today’s market.

On July 19, 2018, the French Data Protection Authority (“CNIL”) announced that it served a formal notice to two advertising startups headquartered in France, FIDZUP and TEEMO. Both companies collect personal data from mobile phones via software development kit (“SDK”) tools integrated into the code of their partners’ mobile apps—even when the apps are not in use—and process the data to conduct marketing campaigns on mobile phones.

On July 12, 2018, two U.S. Senators sent a letter to the Federal Trade Commission asking the agency to investigate the privacy policies and practices of smart TV manufacturers. In their letter, Senators Edward Markey (D-MA) and Richard Blumenthal (D-CT) note that smart TVs can “compile detailed profiles about users’ preferences and characteristics” which can then allow companies to personalize ads to be sent to “customers’ computers, phones or any other device that shares the smart TV’s internet connection.”

On July 11, 2018, computer manufacturer Lenovo Group Ltd. (“Lenovo”) agreed to a proposed $8.3 million settlement in the hopes of resolving consumer class claims regarding pop-up ad software Lenovo pre-installed on its laptops. Lenovo issued a press release stating that, "while Lenovo disagrees with allegations contained in these complaints, we are pleased to bring this matter to a close after 2-1/2 years."

On June 28, 2018, the Governor of California signed AB 375, the California Consumer Privacy Act of 2018 (the “Act”). The Act introduces key privacy requirements for businesses, and was passed quickly by California lawmakers in an effort to remove a ballot initiative of the same name from the November 6, 2018, statewide ballot. We previously reported on the relevant ballot initiative. The Act will take effect January 1, 2020.

On June 25, 2018, the New York Department of Financial Services (“NYDFS”) issued a final regulation (the “Regulation”) requiring consumer reporting agencies with “significant operations” in New York to (1) register with NYDFS for the first time and (2) comply with the NYDFS’s cybersecurity regulation. Under the Regulation, consumer reporting agencies that reported on 1,000 or more New York consumers in the preceding year are subject to these requirements, and must register with NYDFS on or before September 1, 2018. The deadline for consumer reporting agencies to ...

As reported in BNA Privacy Law Watch, a new law makes data protection a constitutional right in Chile. The measure, which was enacted by the National Congress of Chile, lists “protection of one’s personal data” as an individual right under the Constitution’s Article 19. As a result of this measure, Chilean courts must expedite privacy-related cases under constitutional protection.

On June 21, 2018, California lawmakers introduced AB 375, the California Consumer Privacy Act of 2018 (the “Bill”). If enacted and signed by the Governor by June 28, 2018, the Bill would introduce key privacy requirements for businesses, but would also result in the removal of a ballot initiative of the same name from the November 6, 2018, statewide ballot. We previously reported on the relevant ballot initiative.