This past summer, Apple introduced significant changes for iOS 14 in the data privacy realm (we discussed these here). Among those changes are Apple’s so-called privacy “nutrition labels” intended to better inform consumers of the data collection and privacy practices of individual applications. Apple announced a few days ago that developers will be required to provide these new privacy details to app users starting December 8. This applies to both new apps and any apps already in the App Store that are updated, and developers may already submit details through the through App Store Connect. Apple has provided more information here.
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Providing Financial Incentives Under CCPA
With COVID-19 driving so much business online, like most people, I am increasingly seeing offers from companies vying for new customers to hand over my contact information in exchange for discounts or rewards. This includes businesses that seek to use personal information obtained through loyalty or rewards programs, those that offer price or service differences such as with free versus paid subscriptions to a service (e.g., music streaming), or those that simply want to increase their marketing reach and attract new consumers by offering a discount in exchange for personal information. There is really nothing new to these types of marketing strategies, but for companies that are subject to the California Consumer Privacy Act (CCPA), providing discounts, rewards or free-versus-paid services to California consumers has become trickier because the CCPA contains very specific – and quite stringent – obligations when it comes to financial incentives. The CCPA defines a “financial incentive” as a program, benefit, or other offering (including payments to consumers) related to the collection, retention, or sale of personal information – or, put simply, you give me your personal information and I will give you a discount code or rewards. Many businesses that are subject to CCPA, however, are not complying with the CCPA’s complex requirements regarding financial incentives. Failing to comply could spell trouble. Below we explain the challenges of implementing the CCPA’s requirements with respect to financial incentives.
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Data Security and the New York SHIELD Act: Going Beyond New York Companies
With the Covid-19 crisis, many companies that may have traditionally only done business offline are transitioning and expanding into e-commerce. Others are starting new businesses and innovating new technologies and platforms. There are a multitude of considerations that go into these new ventures, an important one of which is security.
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CCPA Enforcement: What to Expect Next
During a recent keynote presentation with the IAPP following the July 1 enforcement deadline of the CCPA, Stacey Schesser, Supervising Deputy Attorney General for the State of California (“Deputy AG”), provided a bit of a roadmap for CCPA enforcement actions from the California Attorney General (“AG”) that are both currently underway and expected in the near future.
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Schrems II: EU Personal Data Transfers to the U.S. and the Invalidation of the Privacy Shield
Despite three annual reviews by European Union Commissioners, the European Court of Justice (CJEU) invalidated the Privacy Shield and called into question many transfers of personal data pursuant to the Standard Contractual Clauses on July 16. At stake are transfers of EU personal data to thousands of U.S. companies that rely on personal data being transferred from the EU. The case is colloquially known as “Schrems II” as it is the second case involving Maximillian Schrems (Case C-311/18 Data Protection Commissioner v Facebook Ireland and Maximillian Schrems). Mr. Schrems’ first case resulted in an invalidation of the EU-US Safe Harbor, the Privacy Shield’s predecessor in 2015.
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CCPA and Web Accessibility
The California Attorney General’s final proposed regulations under CCPA (“Regulations”) have been submitted, and pending approval by the California Office of Administrative Law, will soon become enforceable by law. One often overlooked requirement of the CCPA is the obligation of covered businesses to provide notices that are “reasonably accessible.” All drafts of the Regulations have provided more detail about the accessibility requirement contained in the CCPA, and the final Regulations make clear that for notices provided online, businesses must follow generally recognized industry standards, such as the Web Content Accessibility Guidelines, version 2.1 (WCAG) from the World Wide Web Consortium. While companies have largely focused on updating the language or substance of their notices to comply with CCPA, this requirement as to form has, by and large, slipped through the cracks, but is certain to generate some discussion (if not litigation) in coming months.
By way of background, the Americans with Disabilities Act (ADA) requires, among other things, that places of “public accommodation” remove barriers to access for individuals with disabilities. While this has long been considered the rule for physical establishments, including privately-owned, leased or operated facilities like hotels, restaurants, retail merchants, health clubs, sports stadiums, movie theaters, and so on, virtual accessibility has been much less consistent, and generally the exception rather than the norm. In fact, web accessibility hardly ever appears on businesses’ radars, due perhaps to a very short-sighted perception of what, in fact, qualifies as a disability as well as a lack of overall guidance.
Web accessibility means ensuring that websites, mobile applications, and other virtual platforms can be used by everyone, including those with disabilities, such as impaired vision. However, what exactly is required is a source of confusion. In 2019, the Department of Justice (DOJ), which is responsible for establishing regulations pursuant to the ADA, withdrew regulations that had been drafted for website accessibility, and has since yet to promulgate any such regulations. This has left courts with the task of determining how and to what extent web accessibility is required under the ADA when it comes to businesses that offer goods and services online, with varying results.
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Apple’s iOS 14 Transformative Privacy Announcements
At the Worldwide Developers Conference on June 23, Apple announced an assortment of new privacy features – some quite significant for developers – that will be included as part of iOS 14. Some of the new privacy features include added protections against user tracking on apps and websites, as well as transparency measures to prevent apps from using cameras or microphones without a user’s knowledge. How location data is collected will also be impacted: iOS already enables users to block specific apps from collecting data about their location, but now users will be able to share approximate location data.
One very significant change is that app developers will now be required to disclose the types of data that their app collects, and importantly, call out specific information that could be used to track users across platforms. Inspired by nutrition labels that are typically affixed to food products, these new disclosure mandates from Apple will require developers to complete a specific form (showcased at the Worldwide Developers Conference). When users search for an app, the summary of collected data will appear alongside other information about the app.
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The California Privacy Rights Act: CCPA Part Two
As if businesses did not already have enough to address with the COVID-19 pandemic and compliance with the California Consumer Privacy Act (the “CCPA”), businesses need to consider the California Privacy Rights Act (the “CPRA”), which will almost certainly be on the November ballot. Structured as an amendment to the CCPA and also known as “CCPA 2.0”, the CPRA ballot initiative was spawned by Alastair Mactaggart. You may recall Mr. Mactaggart as the real estate developer who submitted a ballot initiative that resulted in a negotiation with the state legislature to replace the initiative with the CCPA. If the CPRA is passed and becomes law, it would be effective and enforceable January 1, 2023, with certain provisions having a look-back provision.
The CPRA would establish a new category of “sensitive data” that is reminiscent of the GDPR’s definition of special categories of data but it is much broader. The definition is overly-inclusive, spanning from race, religion, and sexual orientation to financial account information and government identifiers (e.g., social security numbers). Consumers could choose to limit the use, sale and sharing of their sensitive data. Additional links on business websites may be required to “Limit the Use of My Sensitive Personal Information” in addition to the current “Do Not Sell My Personal Information” link that some businesses must now include under the CCPA.
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Returning to Work: CCPA Considerations
As cities and states gradually open up, companies have begun to assess under what circumstances they can re-open the workplace – and in particular, what health-related personal information can and should be collected. When it comes to monitoring employees, generally speaking, privacy and employment law are increasingly overlapping as more stringent laws are adopted, and COVID-19 has brought this overlap to the forefront. Our employment team at Hopkins & Carley has provided a number of resources and webinars on the employment-related issues of COVID-19 and what can and cannot be done (available here). Here we will focus on the intertwined privacy implications of allowing individuals – employees and non-employees – back into offices and facilities, particularly with respect to the California Consumer Privacy Act (CCPA).
What are the CCPA’s notice requirements?
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Privacy Issues in Bankruptcy Sales
I recently co-wrote the following client alert with one of my colleagues, Monique Jewett-Brewster. Monique advises creditors, commercial landlords and tenants, and asset purchasers in business bankruptcies and in all other aspects of insolvency law.
As we move closer to a global recession caused by the current pandemic, some companies will find themselves in the unfortunate position of having to seek bankruptcy relief. This may have some important and often overlooked privacy implications. There is no question that in this day and age, one of a business’ most valuable assets is the personal information that it has collected from its customers and/or end-users – often more so than any of its tangible assets. Increasingly, as business shifts online, this is true not only of technology companies but also of “brick and mortar” companies.
However, when a business becomes a debtor, the sale of personal information can be problematic. Section 363(b) of the US Bankruptcy Code provides that a debtor that has a privacy notice prohibiting the transfer of personally identifiable information (“personal information”) may not use, sell or lease such information other than in the ordinary course of business unless (1) the use, sale or lease is consistent with the terms of the privacy notice or (2) after the appointment of a consumer privacy ombudsman (“CPO”) the court finds, after giving due consideration to the facts, circumstances, and conditions, that the sale or lease would not violate applicable non-bankruptcy law. These restrictions only apply if the debtor disclosed to its customers a privacy notice prohibiting the transfer of personal information to persons not affiliated with the debtor and the policy was in effect on the date of the bankruptcy filing.
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