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New Privacy Notice and Compliance Requirements Taking Effect in 2023
Multiple state Privacy Acts take effect in 2023. Typically, these laws require website operators to implement certain compliance measures and to post a Privacy Notice informing consumers of their rights and the method of exercising those rights. As of January 1, 2023, state privacy laws already in effect include Virginia’s Consumer Data Protection Act and the California Privacy Rights Act which expands the terms of the California Consumer Privacy Act. It should be noted that Nevada’s Security and Privacy of Personal Information Statute is also already in effect but its narrow scope makes it less applicable to website operators. Both Connecticut’s Personal Data Privacy and Online Monitoring Act and the Colorado Privacy Act become effective on July 1, 2023. The Utah Consumer Privacy Act becomes effective on December 31, 2023. Additional states have undertaken development of privacy laws and more new laws are likely in the future.
Similarities among these state laws generally include consumer rights such as access, correction, and deletion of personal information, and the right to obtain a copy in a portable format. Additionally, the laws specify how the website operator must enable the consumer to request to exercise these rights, time periods allowed for the operator’s response or extension request, and, in some cases, an appeal process when requests are denied. Unfortunately, the state laws are not consistent enough to permit compliance with a single “one size fits all” policy. Most website operators will likely find it advisable to segment their Privacy Policy to discuss each state’s requirements independently of the others.
Federal privacy laws are limited in scope and address subsets of privacy concerns, such as the Children’s Online Privacy Protection Act and the Health Insurance Portability and Accountability Act. When developing or modifying a Privacy Policy to address the new state laws, a website operator must still ensure compliance with federal requirements.
The Internet Law Group is available to consult concerning these new state requirements and to assist preparation of the necessary compliance materials. If you have questions concerning state privacy laws, please contact us at info@tilg.us.
Kavon Adli of TILG Named 2022 Southern California Super Lawyer
Kavon Adli, founder and managing attorney of The Internet Law Group, has been selected for inclusion in the Southern California Super Lawyers list for the third consecutive year.
Each year the organization recognizes no more than 5% of lawyers who have attained a high-degree of peer recognition and professional achievement. Lawyers are selected from all 50 states and Washington, D.C. in more than 70 practice areas. The selection process includes independent research, peer nominations and peer evaluations.
“I am honored to be recognized in the business litigation practice area,” said Adli. “When I chose to enter the legal field, I wanted to combine my interest in people, critical reasoning and advocacy by representing clients ethically and with a superior level of competence. This recognition tells me that we are accomplishing those goals.”
Adli founded The Internet Law Group when he saw an unmet need where law intersects the online world.
“We have a unique focus in online law and provide a boutique personal service to our clients,” added Adli. “The Internet continues to evolve and so does The Internet Law Group but, at its foundation, the firm will always be focused on providing our clients with knowledgeable and personal service.”
TILG publishes “Website Policy and Agreements” Practice Note (LexisNexis Practical Guidance, 2021)
By Kavon Adli and Jason Civalleri
* For informational purposes only; not intended as legal advice or as a recommendation/suggestion to act or omit to act.
Website-Policy-and-Agreements_Lexis-brandedNextdoor.com Post Denied Anti-SLAPP Protection
After the Leys’ dog killed neighbor Jeppson’s cat, the Leys paid Jeppson $2,000 as part of a settlement agreement. After the settlement, a court granted Cates a restraining order against Jeppson. Cates and her husband Otto alleged Jeppson hired men to cut through their fence, to trespass, and to trim their tree. Jeppson previously demanded Cates and Otto cut the tree because it interfered with his ocean view; he had threatened action if he did not get his way. They said Jeppson had intimidated them by screaming at them at their house. Part of the restraining order commanded Jeppson to dispose of guns.
Cates told Heidi Ley about her troubles with Jeppson. Heidi Ley told Eric Ley, who “felt compelled” to warn the community to be aware of Jeppson. In a post on the Nextdoor.com website titled “Michael Jeppson’s Restraining Order” that allegedly reached some 951 neighbors, Eric Ley wrote as follows:
Since this is a neighborhood blog, I feel it is important to provide information about the case against Michael Jeppson for trespassing and vandalism on his neighbor’s property. Michael Jeppson of Raymond James Financial Corporation and Jeppson Wealth Management could face jail time for these charges. Most importantly, a restraining order was issued on 6/27/2017, and the courts forced Michael Jeppson to relinquish his gun arsenal due to the danger he poses to his neighbors. If interested, you can review the court document at lacourts.org for a one dollar fee. The signs in Michael Jeppson’s yard pictured below warn the neighborhood that he intends to solve disputes with gun violence, and he has stated this intent in countless blog posts and neighborhood fliers. Beware!
Jeppson v. Ley, 2020 WL 486970 (Cal. App. Ct. Jan. 30, 2020) *3.
Ley’s post attached three photos of Jeppson’s yard signs, which forbade trespassing with images of guns and a bullet riddled human silhouette. Jeppson sued the Leys for breach of contract, defamation, and intentional infliction of emotional distress. The Leys filed a special motion to strike under Code of Civil Procedure section 425.16 in response to Jeppson’s complaint, which was denied. The Leys appealed. On January 30, 2020 the California Court of Appeals affirmed the order of the Superior Court of Los Angeles County denying the anti-SLAPP motion, finding as follows at *14-15:
Neither Ley nor Jeppson were in the public eye.
None of their acts directly affected a large number of people beyond the three households. Ley claimed the mantle of town crier, but the conduct had directly involved only dog owner Ley, cat owner Jeppson, and tree owner Cates.
Despite the medium of the internet, the topic was not of widespread public interest. There is no issue of public interest when the speaker’s words are merely an effort to gather ammunition for another round in the speaker’s neighborhood wrangle.
Ley and Jeppson had a history of personal conflict when Ley decided to upload to the internet about Jeppson. … Ley sought to endow his statements with lofty justifications. But the matter boiled down to Ley’s interest in gathering ammunition for another round in his clash with Jeppson. Ley’s internet post merely manifested, and remained, his altercation with his neighbor.
… The website had a potential audience of 951, but there is no evidence anyone actually read or cared about Ley’s post. There was a restraining order on Jeppson that barred him from harassing his tree-owning neighbor Cates. Ley proclaimed Jeppson a threat to public safety, but this involved Jeppson trimming Cates’s tree without her permission and Jeppson putting “no trespassing” signs in his yard. Jeppson owned guns, but the restraining order blocked Jeppson’s access to them.
Ley’s arguments are ‘too tenuously tethered to the issues of public interest they implicate, and too remotely connected to the public conversation about those issues, to merit protection . . . ‘ (FilmOn, supra, 7 Cal.5th at p. 140 [2019].) Under the case law, this neighborhood flap did not raise issues about the ‘public interest,’ even though it made an appearance on the internet.
Online Terms of Use “Browsewrap” Agreement Found Binding
On May 3, 2019, the United States District Court for the Northern District of California granted Defendant’s motion to compel arbitration, finding that its online terms of use agreement (the “Terms”) was enforceable even in the absence of the consumer’s express assent to the Terms. Guttierrez v. Friendfinder Networks, Inc., No. 18-05918 (N.D. Cal. May 3, 2019).
Defendant AdultFriendFinder (“AFF”) is an adult online dating site. Plaintiff website user alleges that in October 2016 “a hacker or group of hackers breached Defendant’s system and downloaded two decades worth of personal information of 339 million AFF users.” Compl. ¶ 32. Based on this breach, and Defendant’s alleged failure to prevent and timely cure it, Plaintiff brought a putative class action against AFF. Defendant moved to compel arbitration and dismiss the action based on the arbitration provision contained in the Terms. The Court stated that the Ninth Circuit’s decision in Nguyen v. Barnes & Noble Inc., 763 F.3d 1171 (9th Cir. 2014) guided its decision.
“In Nguyen, the Ninth Circuit determined that the plaintiff had not agreed to the defendant’s terms of use (and the arbitration clause therein) by purchasing a product on the defendant’s website, even though the terms were displayed on every page of the website and on each page of the website’s online-checkout process. The court rejected the defendant’s argument that ‘the placement of the terms of use hyperlink on its website put [the plaintiff] on constructive notice of the arbitration agreement’ such that the plaintiff’s ‘subsequent use of the website[] was enough to bind him to the Terms of Use.'”
Guttierrez at *5. In reaching this conclusion, the Ninth Circuit noted that courts are “traditional[ly] reluctant to enforce browsewrap agreements against individual consumers,” and set forth the basic legal framework governing online contracts:
“Contracts formed on the Internet come primarily in two flavors: ‘clickwrap’ (or ‘click-through’) agreements, in which website users are required to click on an ‘I agree’ box after being presented with a list of terms and conditions of use; and ‘browsewrap’ agreements, where a website’s terms and conditions of use are generally posted on the website via a hyperlink at the bottom of the screen. . . . Unlike a clickwrap agreement, a browsewrap agreement does not require the user to manifest assent to the terms and conditions expressly . . . a party instead gives his assent simply by using the website. . . . The defining feature of browsewrap agreements is that the user can continue to use the website or its services without visiting the page hosting the browsewrap agreement or even knowing that such a webpage exists.”
Nguyen, supra, at 1175–76 (citations, alterations, and internal quotation marks omitted). In the case at hand, although “the website did not require Plaintiff to agree to the Terms or otherwise acknowledge that he had read them,” (Guttierrez at *10), a call with a customer service representative placed Plaintiff on inquiry notice of the Terms:
“The customer service representative informed Plaintiff that he had been banned because he violated the Terms. A few seconds later, when Plaintiff asked for further elaboration as to why he had been banned from the chat, the customer service representative reiterated: ‘Because we set restrictions on the website so you need to follow our rules and regulations.’ This constituted notice to Plaintiff that if he wanted to use the site, he needed to comply with the Terms. . . .Plaintiff responded with ‘Yeah I know,’ acknowledging that he understood that he needed to follow those rules and regulations when using the site. And the Terms were readily available to Plaintiff on the website, such that his failure to read them, despite knowing he was bound by them, cannot absolve him of his need to comply with them.”
Id. at *12-13 (internal citations omitted).
“Because the Terms clearly stated that continued use of the site would constitute acceptance of the Terms, Plaintiff’s continued use of the site after being put on notice of the Terms and his need to comply with them constituted acceptance of the Terms.” Id.
Copyright Office Registration Decision Required in Order to Sue for Copyright Infringement
On March 4, 2019, Justice Ruth Bader Ginsburg, delivering a unanimous opinion of the Supreme Court of the United States, held that in order to commence a lawsuit for copyright infringement, 17 U. S. C. §411(a) generally requires the Copyright Office to have registered or denied registration of a copyright. Fourth Estate Pub. Ben. Corp. v. Wall-Street.com, LLC, 586 U. S. ____ (2019), 2019 U.S. LEXIS 1730.
§411(a) states in pertinent part, “no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made . . .” However, where “registration has been refused, the applicant is entitled to institute a civil action for infringement if notice . . . is served on the Register of Copyrights . . . The Register may . . . become a party to the action . . .” 17 U. S. C. §411(a).
Petitioner Fourth Estate Public Benefit Corporation is a news organization producing online journalism. Its license agreement with Wall-Street.com, LLC required it to remove from its website all content produced by Fourth Estate before canceling the agreement. Wall-Street canceled, but continued to display Fourth Estate articles. Fourth Estate sued for copyright infringement. The complaint alleged that Fourth Estate had filed applications to register the articles with the Register of Copyrights. Because the Register had not yet acted on Fourth Estate’s applications, the District Court dismissed the complaint, and the Eleventh Circuit affirmed. Id. at *4-5. The Supreme Court granted Fourth Estate’s petition for certiorari to resolve a split among U. S. Courts of Appeals on when registration occurs in accordance with §411(a).
“All parties agree that, outside of statutory exceptions not applicable here, §411(a) bars a copyright owner from suing for infringement until ‘registration . . . has been made.’ Fourth Estate and Wall-Street dispute, however, whether ‘registration . . . has been made’ under §411(a) when a copyright owner submits the application, materials, and fee required for registration, or only when the Copyright Office grants registration. Fourth Estate advances the former view—the ‘application approach’—while Wall-Street urges the latter reading—the ‘registration approach.’ The registration approach, we conclude, reflects the only satisfactory reading of §411(a)’s text. We therefore reject Fourth Estate’s application approach.
Id. at *7.
The Court’s opinion may be found at: https://www.supremecourt.gov/opinions/18pdf/17-571_e29f.pdf.
TILG Attorney Named to 2020 Southern California Super Lawyers List
We are pleased to announce that Kavon Adli, shareholder at The Internet Law Group, has been selected to the 2020 Southern California Super Lawyers list. This is an exclusive list, recognizing no more than five percent of attorneys in the state.
Super Lawyers, part of Thomson Reuters, is a research-driven, peer influenced rating service of outstanding lawyers who have attained a high degree of peer recognition and professional achievement. Attorneys are selected from more than 70 practice areas and all firm sizes, assuring a credible and relevant annual list.
The annual selections are made using a patented multiphase process that includes:
• Peer nominations
• Independent research by Super Lawyers
• Evaluations from a highly credentialed panel of attorneys
The objective of Super Lawyers is to create a credible, comprehensive and diverse listing of exceptional attorneys to be used as a resource for both referring attorneys and consumers seeking legal counsel.
The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country, as well as the Southern California Super
Lawyers Digital Magazine.
Please join us in congratulating Kavon Adli on his selection.
For more information about Super Lawyers, go to SuperLawyers.com
Music Modernization Act Reforms The Music Licensing Landscape
On October 11, 2018, the President signed into law the Orrin G. Hatch—Bob Goodlatte Music Modernization Act, or Music Modernization Act (“MMA”). The MMA, a compendium of three separate bills introduced during the 115th United States Congress, aims to modernize copyright issues related to digital streaming and other new technology involving music and audio recordings.
Title I, the Musical Works Modernization Act, looks to improve how music licensing and royalties would be paid in consideration of streaming media services. It does so by creating a blanket license for digital music providers to make permanent downloads, limited downloads, and interactive streams. Previously licenses could only be obtained on a song-by-song basis. It also creates a mechanical licensing collective (“MLC”) to administer the blanket license, and makes improvements to royalty rate processing. The MLC will (a) collect, distribute and audit the royalties generated from licenses for the respective musical works owners; (b) create and maintain a public database that identifies musical works with their owners along with ownership information; (c) provide information to help match musical works with their respective sound recordings; and (d) hold unclaimed royalties for at least 3 years before distributing them on a market share basis to copyright owners.
Title II, the Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society (CLASSICS) Act, establishes that sound recordings before 1972 are covered by copyright until February 15, 2067, with additional language to grandfather in older songs into the public domain at an earlier time. Under prior US Copyright Law, sound recordings made before February 15, 1972 were not covered under federal copyright law, leaving it up to individual states to provide recording protection.
Title III, the Allocation for Music Producers (AMP) Act, provides that SoundExchange, a non-profit organization established by Congress to distribute royalties on sound recordings, will distribute part of those royalties to “a producer, mixer, or sound engineer who was part of the creative process that created a sound recording.”
The text of the Act may be found at: https://www.congress.gov/bill/115th-congress/house-bill/5447/text.
Federal Court Holds That TCPA Covers Direct-To-Voicemail Messages
In a case of first impression, on July 17, 2018 the United States District Court for the Western District of Michigan held that a direct-to-voicemail message, or direct drop voicemail, is considered a “call” within the meaning of 47 U.S.C. § 227(b)(1)(A)(iii). Saunders v. Dyck O’Neal, Inc., 2018 WL 3453967, at *4.
Federal Home Loan Mortgage Corporation assigned Dyck O’Neal all of its right, title, and interest to an outstanding debt that Saunders and her then-husband owed. Dyck O’Neal attempted to collect the debt and contacted Saunders by leaving her approximately thirty voicemails from April 2016 to April 2017.
The Telephone Consumer Protection Act (the “TCPA”) prohibits any person within the United States from “mak[ing] any call … using any automatic telephone dialing system or an artificial or prerecorded voice … to any telephone number assigned to a paging service, cellular telephone service … or any service for which the called party is charged for the call.” Id. at *2. “Both the FCC and the courts have recognized that the scope of the TCPA naturally evolves in parallel with telecommunications technology as it evolves, e.g., with the advent of text messages and email-to-text messages or, as we have here, new technology to get into a consumer’s voicemail box directly.” Saunders at *3.
“Voicemails are intrinsically tied to cellular phones. By leaving a voicemail directly in the server space associated with Saunders’ phone, Dyck O’Neal was attempting to communicate with Saunders via her phone—which is the definition applied to the TCPA’s use of ‘call.’ Further, Dyck O’Neal’s automated message instructed Saunders to call them at a specific phone number—inviting additional communication over the telephone.
The effect on Saunders is the same whether her phone rang with a call before the voicemail is left, or whether the voicemail is left directly in her voicemail box, i.e., Saunders receives a notification on her phone that she has a new voicemail. The effect on Saunders is also the same in receiving a text message—which would fall under the TCPA—each time, she received a notification on her phone that she had a new message, and had to take steps to review or delete the message. In fact, voicemails are arguably more of a nuisance to consumers than text messages. To limit the TCPA to instances where Dyck O’Neal specifically dialed Saunders’ phone number and then reached her voicemail, and exclude Dyck O’Neal’s back door into Saunders’ voicemail box, would be an absurd result. The TCPA was created to limit the harassment and nuisance that automated calls and messages place on consumers—which is precisely what Saunders alleges Dyck O’Neal has done. Dyck O’Neal cannot skirt the statute with VoApp’s new technology.”
Id. at *4.
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