Capitol Alert

'The most far-reaching privacy law in the country' heads to vote in California Legislature

A last-minute deal between lawmakers, company rights groups and consumer privacy advocates is heading to a vote in the state Legislature Thursday.

The agreement, struck over the weekend, is intended to prevent an even-tougher initiative from heading to voters in November.

Alastair Mactaggart, a San Francisco real estate developer who has spent more than $3 million on his privacy initiative, said he will pull the initiative as soon as the the California Consumer Privacy Act of 2018 is signed into law — just hours ahead of a deadline to file with the Secretary of State's office.

While he cited strong public support for his ideas, he said he worried that tech companies could outspend him and shift public opinion. Tech companies feared the initiative would undercut their ability to sell consumer information they collect.

"If you can have certainty now versus uncertainty later, I'll take certainty now as long as you're not making big concessions," Mactaggart said. "I don't feel like we made any big concessions."

Though AB 375 provides more power for Californians to hold companies accountable for potential abuse of their data, it was hastily amended over the weekend with broader language to give tech companies more legal protection.

Members of the public could ask a business to delete information they have on them. Upon request, businesses that sell consumers' information would have to disclose the categories of information they collect. The bill also allows individual consumers to sue companies for up to $750 if there is an unauthorized breach of their non-encrypted personal information.

Industry groups argue the bill still intrudes on the rights of companies, but say it is a better deal than the initiative.

“We oppose many problematic provisions contained within AB 375 and the unprecedented lack of debate or full legislative process," said a statement from Robert Callahan, vice president of state government affairs for the Internet Association. "The internet industry will not obstruct or block AB 375 from moving forward, because it prevents the even worse ballot initiative from becoming law in California. The circumstances around this bill are specific to California, and it is critical going forward that policymakers and industry work to correct the inevitable, negative policy and compliance ramifications this last-minute deal will create.”

Comcast and Google declined to comment. AT&T and Amazon did not immediately respond to a request for comment.

In a statement, Facebook expressed support for the bill, explaining that people should be in control of their online information.

"While not perfect, we support AB 375 and look forward to working with policymakers on an approach that protects consumers and promotes responsible innovation,” said Will Castleberry, Facebook's vice president of state and local public policy.

Mactaggart hopes companies will change their data collection practices once they are forced to disclose more information.

"There needs to be some re-balancing of our rights in the face of these enormously, all-powerful tech companies," Mactaggart said.

State Sen. Bob Hertzberg, D-Los Angeles, is a primary sponsor of the bill who participated in heated negotiations over the weekend between industry and consumer privacy groups. He said the bill will soon become "the most far-reaching privacy law in the country."

A spokesman for Gov. Jerry Brown declined to discuss when, and if, the governor will sign the bill.

Mactaggart said he has not received any reassurances from Brown's office. He threatened to keep the initiative on the ballot if it weren't signed into law by the end of the day Thursday. According to a Hertzberg spokeswoman, the bill will arrive on Brown's desk by 3 p.m. If signed, it will go into effect at the start of 2020.

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