Privacy Bill Gets Enforcement, State Law Tweaks Ahead of Markup

Changes to landmark privacy legislation unveiled Tuesday aim to resolve some of the thorniest differences among lawmakers ahead of an anticipated committee vote.

Committee leaders plan to introduce an amendment to the bipartisan, bicameral American Data Privacy and Protection Act (H.R. 8152) that would change the bill’s relationship to state privacy laws — meant to address California lawmakers’ worries about the bill weakening state law. They also sped up the timeline for when people could directly sue companies for privacy violations. Additional bipartisan amendments will be offered, a spokesperson for committee Democrats, CJ Young, said.

Advancing the legislation out of the House Energy and Commerce Committee Wednesday would mark a watershed moment on an issue the panel has been seeking to tackle for years. Consumers who worry their data is being misused, and companies seeking regulatory stability, have called for Congress to pass a federal privacy bill.

Committee Chair Frank Pallone (D-N.J.) expressed confidence in the latest version of the bill, saying “we’re going to pass it out of committee tomorrow.” Ranking member Cathy McMorris Rodgers (R-Wash.) also lauded the bill’s prohibition on the exploitation of people’s sensitive information and the protection of children and small businesses.

Read a list of changes to the bill here

In the updated bill, the California Privacy Protection Agency would get express authority to enforce the federal law in the same way as it would otherwise enforce the California Consumer Privacy Act. The amendment would also protect specific state laws regarding use of encryption as a means for data security, as well as public health activities, reporting, data, and services.

It isn’t clear if the changes will satisfy California Democrats, who as of Tuesday were still reviewing the updated legislation. “They have made improvements, no question it put a couple smiles on our face, but we’re looking at the fine-tuning of it to see if we can actually get to the point where we support the bill,” Rep. Tony Cardenas (D-Calif.) told Bloomberg Government.

In a Tuesday letter to Congress led by California Attorney General Rob Bonta, nine state attorneys general said federal legislation should set a floor, not a ceiling, for privacy rights and allow flexibility to keep pace with technology by not preempting “more rigorous” state laws.

Earlier: California Democrats Demand Stronger Privacy Protection Bill

The Lawyers’ Committee for Civil Rights Under Law endorsed the updated bill, contending it includes stronger civil rights protections than any state privacy law. The bill has stronger anti-discrimination protections than California’s law and requires testing algorithms for biases that affect access to essential needs such as housing, employment, credit, healthcare, education, and public accommodations, the group said in a press release.

Enforcement

The bill’s sponsors updated its enforcement language to allow individuals to directly sue companies for privacy violations — known as private right of action — two years after the law’s enactment. The original bill would have made people wait four years.

The amendment would also broaden the prohibition on pre-dispute arbitration. Terms of service agreements between consumers and providers tend to include a requirement that consumers with a complaint must resolve it in private arbitration rather than in court.

Under the new version of the bill, the prohibition on forced arbitration would cover any dispute involving claims related to gender or partner-based violence or physical harm—instead of just disputes involving minors, as in the original bill.

Senate Commerce, Science, and Transportation Chair Maria Cantwell (D-Wash.), who has her own privacy bill, opposed the introduced version of the bill, which she said had weak enforcement provisions. She specifically raised concerns with the original four-year delay and the forced arbitration language. A spokesperson for Cantwell didn’t respond to a request for comment on the updated language.

To contact the reporter on this story: Maria Curi in Washington at mcuri@bloombergindustry.com

To contact the editor responsible for this story: Sarah Babbage at sbabbage@bgov.com