United States: New California Law Impacts Use Of Information From Minors, Offers Right To Delete

Law Targets Sites and Mobile Apps Directed to Minors, Offers "Online Eraser"     

Likely to Have Nationwide Effect

On July 1st of this year, new amendments to the Children's Online Privacy Protection Act Rule (COPPA Rule) came into effect, with perhaps the most pronounced changes being the expansion of COPPA to apply to geolocation information and persistent identifiers used in behavioral advertising.  Critics called the amendments jumbled and a compliance headache, while privacy advocates were buoyed, but thought the changes did not go far enough to protect the online privacy of children.  Still others contended that federal law contains a gap that fails to offer privacy protections for teenage users.

Once again, the California state government has stepped up to fill what it perceives to be a void in federal online privacy protection, this time to address certain restrictions on the use of information collected from minors and to give minors an online "eraser" of sorts. In late September, Gov. Brown signed S.B.568, which expanded the privacy rights for California minors in the digital world.

"Minors", by the way, are defined under the law as residents of California under age 18 – this definition in itself is an expansion of the protections afforded to children under COPPA, which addresses the collection and use of information from children under 13.  That is not the only expansion of COPPA presented by this new law.  The federal COPPA Rule is primarily concerned with mandating notice and parental consent mechanisms before qualifying sites or mobile apps can engage in certain data collection and data tracking activities with respect to children under 13.  The California statute's marketing restrictions for minors contain no parental consent procedures  – rather, restrictions for covered web services directed to minors that relate to certain specified categories of activities that are illegal for individuals under 18 years of age.

As a practical matter, compliance with this law will require certain changes in the way website publishers collect and process user information.  For example, it is much easier for online operators to determine whether their websites are directed to children under 13 as opposed to "directed to minors" under 18.  Going forward, sites and apps will have to reevaluate their intended audience, as well as establish procedures for when a minor user self-reports his or her age, triggering the site having actual knowledge of a minor using its service.

S.B.568 has two principal parts:  minor marketing restrictions and the data "eraser."

Marketing Restrictions: The new California law prohibits an operator of a website, online service or mobile app directed to minors or one with actual knowledge that a minor is using its online site or mobile app from marketing or advertising specified types of products or services to minors. The law also prohibits an operator from knowingly using, disclosing, compiling, or allowing a third party to use, disclose, or compile the personal information of a minor for the purpose of marketing or advertising specified types of products or services. Moreover, the law makes this prohibition applicable to an advertising service that is notified by a covered operator that the site, service, or application is directed to a minor.  The statute lists 19 categories of prohibited content covered by the law's marketing restrictions, including, firearms, alcohol, tobacco, drug paraphernalia, vandalism tools and fireworks.  Notably, the law does not require an operator to collect or retain the ages of users, and provides operators with a safe harbor for "reasonable actions in good faith" designed to avoid violations of the marketing restrictions.

Online Eraser: The second part of S.B. 568 requires operators of websites and applications that are directed to minors, or that know that a minor is using its site or application, to allow minors that are registered users, to remove (or to request and obtain removal of) their own posted content. The operators must also provide notice and clear instructions to minors explaining their rights regarding removal of their own content. Notably, SB 568 does not require operators to completely delete the content from its servers; it only requires that the content be no longer visible to other users of the service and the public.  There are certain exceptions to this "online eraser" right, such as circumstances where any other provision of federal or state law requires the operator or third party to maintain the content, the content is stored on or posted to the operator's site or application by a third party, the operator anonymizes the content, the minor fails to follow the instructions regarding removal, or the minor has received "compensation or other consideration for providing the content."

Both prongs of the law raise many questions:

  • How does a site or application owner determine whether it is covered by S.B.568? Under the statute, a website, online service, or mobile app "directed to minors" means an "Internet Web site, online service, online application, or mobile application, or a portion thereof, that is created for the purpose of reaching an audience that is predominately comprised of minors, and is not intended for a more general audience comprised of adults."
  • What will qualify for "reasonable actions in good faith" under the safe harbor?  What are the legal ramifications of an independent online ad network serving unlawful ads to minors without the knowledge of an otherwise compliant site operator?
  • How does a site implement the "eraser" function? With user tools to eliminate UGC, or will the site control the removal process via an online request form?  Will a removal request necessarily cause the removal of other users' content (e.g. social media postings of other users that comment on a removed comment or submitted photo)?
  • The online eraser right seemingly applies only to minors.  How should a site or app handle requests from adults wishing to remove content they posted when they were minors?  Should sites simply offer the tool to all users to avoid compliance issues?
  • What qualifies as "compensation or other consideration for providing the content" under the exceptions to the online eraser right? Would this include free products, coupon codes, or the right to receive exclusive 'limited time' offers?
  • What changes are required in the site's privacy policies?

The law will come into effect on January 1, 2015. Any company with a website that can be accessed by California residents should assess the impact of these new requirements in the coming year. Considering that most, if not all, major websites and apps necessarily have or will have California-based users, this state law may become a de facto national standard, particularly since technical controls to screen or segregate California users may be unworkable.

[Incidentally, California also recently enacted a new law addressing online tracking, so it appears that the California legislature continues its focus on web privacy].

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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