The recently enacted California Consumer Privacy Act (“CCPA”
or the “Act”) goes into effect on January 1, 2020 and with it comes enhanced
consumer protections for California residents against businesses that collect
their personal information. Generally
speaking, the CCPA requires that businesses provide consumers with information
relating to the business’ access to and sharing of personal information. Accordingly, businesses should determine
whether the CCPA will apply to them and, if so, what policies and procedures
they should implement to comply with this new law.
Application of the CCPA
Importantly,
the CCPA does not apply to all California business. The requirements of the CCPA only apply where
a for-profit entity collects Consumers’ Personal Information, does business in
the State of California, and satisfies one or more of the following: (1) has
annual gross revenues in excess of twenty-five million dollars ($25,000,000); (2)
receives for the business’s commercial purposes, sells, or shares for
commercial purposes the personal information of 50,000 or more consumers,
households, or devices; or (3) derives 50 percent or more of its annual
revenues from selling consumers’ personal information. (California Code of
Civil Procedure § 1798.140(c)(1)(A)-(C).)
Thus, as a practical matter, small “mom
and pop” operations will likely not be subject to the CCPA, but most mid-size
and large companies should review their own books or consult with an accountant
to determine whether the CCPA applies to their business.
Rights Granted to Consumers
“Consumers,” as the term is used in
the CCPA, means “any natural person who is a California resident…” (California Code of Civil Procedure §
1798.140(g).) This broad definition
makes no carve-outs or exclusions for a business’s employees and, despite the
traditional definition of the term “consumer,” does not seem to require that
the resident purchase any goods or services.
This definition seems intentional and was likely designed to prevent
businesses from attempting to circumvent the requirements of the CCPA by
arguing that the personal information they collect does not belong to
“consumers” under the traditional meaning of the word.
While the term “consumer” includes
employees, Civil Code Section 1798.145(g) (effective January 1, 2020) makes a
limited time exception for “personal information that is collected by a
business about a natural person in the course of the natural persons acting as
… an employee of… that business to the extent that the natural person’s
personal information is collected and used by the business solely within the
context of the natural person’s role or formal role as… an employee…” This exception is currently set to lapse on
January 1, 2021, at which time personal information relating to employees will
presumably be subject to the requirements of the CCPA. An example where employee personal information
could be subject to the CCPA is data related to employee benefits or
geo-location data gathered from employee use of rideshare programs like Lyft or
Uber.
Under the
CCPA, all Consumers possess the following four rights in relation to their
personal information:
The right to request that a business disclose to
the consumer the categories and specific pieces of personal information the
business has collected, the purposes for which the personal information is
used, and the sources from which the personal information was collected;
The right to request that a business delete any
personal information about the consumer which the business has collected from
the consumer;
The right to direct a business that sells personal
information about the consumer to third parties not to sell the consumer’s
personal information; and
The right to not be discriminated against by a
business as a result of exercising his or her rights under the CCPA.
Moreover, businesses are required
to disclose the existence of these rights to the consumers at or before the
point of collection of the information. Typically,
this is done pursuant to the business’ privacy policy which is disclosed to the
consumer at the outset of their relationship with the business. For 2020, businesses that must comply with
the CCPA should consider reviewing their existing privacy policies to ensure
that they provide all required notices and prepare policies and procedures for
handling requests from consumers for information relating to their personal information.
What Constitutes Personal Information?
“Personal
Information,” as that term is used in the CCPA, has an expansive definition and
includes all information that identifies, relates to, describes, is capable of
being associated with, or could be reasonably linked with a particular consumer
or household, and includes, but is not limited to:
Identifiers such as real name, alias, postal
address, unique personal identifier, online identifier, IP address, email
address, account name, social security number, driver’s license number,
passport number, or similar identifiers;
Characteristics of protected classifications
under California or federal law (religion, race, national origin, etc.);
Commercial information, including records of
personal property, products or services purchased, obtained, or considered, and
other purchasing or consumer histories or tendencies;
Biometric information;
Internet activity, including browsing history,
search history, and information regarding a consumer’s interaction with a
website, application, or advertisement;
Geolocation data;
Audio, electronic, visual, thermal, olfactory,
or similar information;
Professional or employment-related information;
and
Education information.
Regardless of whether a piece of
information is specifically identified as personal information under the CCPA,
the key inquiry is whether information may reasonably be linked with a
particular consumer or household. If so,
it likely constitutes personal information under the CCPA and is subject to the
consumer rights identified therein.
Penalties for Violation of the CCPA
Businesses
subject to the CCPA face onerous penalties for any violation. Specifically, if a business fails to cure any
alleged violation within thirty (30) days after being notified of alleged
noncompliance, the business will be subject to an injunction to stop its
noncompliant activity and face civil penalties of not more than ($2,500) for
each violation or ($7,500) for each intentional violation. It is unclear from the statute whether the
“each violation” language means a single instance of non-compliance regardless
of the number of consumers affected or whether each affected consumer
constitutes an individual violation.
Alongside these civil penalties, consumers whose personal information is subject to unauthorized access and exfiltration, theft, or disclosure as a result of the business’ violation of the duty to implement and maintain reasonable security procedures may bring a civil action to recover not less than $100 and not greater than $750. However, consumers must provide businesses with 30 days’ written notice of the violation and an opportunity to cure before bringing such a suit. While these penalties are relatively small on a per consumer basis, class-action lawsuits can be initiated, which could result in significant potential liability to non-compliant companies.
Conclusion
In advance of January 1, 2020, businesses should evaluate whether they are subject to the requirements of the CCPA and begin formulating policies and procedures to handle any potential consumer requests thereunder. Regulations relating to the Act are not yet finalized but businesses should keep an eye for finalized regulations in the next several months, which may provide guidance for implementing procedures that comply with the CCPA.
Kevin Bonsignore is an Associate at Wilke Fleury and focuses his practice on general business litigation, bankruptcy, and real estate.
The voting for Professional Research Services’ survey to determine the top attorneys in 2017 for Sacramento Magazine was open to all licensed attorneys in Sacramento, Calif. Attorneys were asked whom they would recommend among 56 legal specialties, other than themselves, in the Sacramento area. Each attorney was allowed to recommend up to three colleagues in each given legal specialty. Once the online nominations were complete, each nominee was carefully evaluated on the basis of the survey results, the legitimacy of their license, and their current standing with the State Bar of California. Attorneys who received the highest number of votes in each specialty are reflected in the following list. – Sacramento Magazine
In addition, David was also acknowledged as a 2020 “Lawyer of the Year” award recipient. He received this accolade for his work in Litigation – Real Estate in Sacramento. Only a single lawyer in each practice area and community is honored with a “Lawyer of the Year” award.
David has extensive and broad experience in the areas of complex civil litigation, with particular emphasis on the representation of residential and commercial property owners in construction-related disputes. David represents homeowners, homeowner associations, developers and contractors in real estate cases, as well as complex construction defect claims involving multiple single-family residences and multi-unit developments.
Wilke Fleury is pleased to announce that it has promoted three associates to the position of Senior Counsel – Bianca Samuel, Adriana Cervantes and Aaron Johnson – who have demonstrated professional excellence and complement the firm’s multi-generational leadership.
“Bianca, Adriana, and Aaron’s ascension to Senior Counsel status reflects their significant accomplishments and contributions to the firm, both professionally and culturally,” said Dan Baxter, Managing Partner. “We are lucky to have all three of them within our ranks here at Wilke Fleury, and look forward to their successes for our clients.”
Senior Counsel have at least six years of experience delivering high-quality legal work, collaborate with partners on the development and management of key practice areas, and actively mentor junior lawyers.
Bianca Samuel litigates a wide variety of employment matters, including claims for discrimination, retaliation, wrongful termination, and single-plaintiff wage and hour claims on behalf of employers and supervisors before all state and federal courts and administrative proceedings. She conducts independent workplace investigations for public and private entities. She also advises and counsels employers on best practices relating to hiring, discipline, termination, wage and hour issues and training on employment related topics.
Adriana Cervantes defends healthcare professionals and hospitals against claims of medical malpractice, intentional torts, licensing actions for unprofessional conduct, and similar charges. She has successfully litigated cases involving obstetrics and gynecology, neurology, cardiology, infectious disease, radiology, psychiatry, emergency medicine, and many other medical specialties. Her practice extends to matters initiated in both state and federal court, and before administrative boards. Adriana also serves as the Fundraising Director for Operation Protect and Defend (OPD) an organization dedicated to engaging public high school students in a dialogue about the U.S. Constitution and promoting civic engagement.
Aaron Johnson has deep experience in Estate Planning, Business Formation and Transactions, Tax Planning and Controversy Resolution. His work in estate planning focuses on succession planning for individuals, family limited partnerships and closely-held businesses. Aaron specializes in drafting wills, trusts, advance health care directives, durable powers of attorney and related documents. In addition, he assists clients and companies with matters covering the full life cycle of business from formation to succession planning. He has experience forming LLCs and S Corporations, drafting Buy-Sell agreements, Purchase and Sale agreements, corporate minutes, and shareholder agreements, among other business documents. Aaron represents individuals and companies in all aspects of tax planning and controversy resolution before federal and state taxing authorities. His experience includes representing clients in front of the Internal Revenue Service (IRS), Franchise Tax Board (FTB) and the California Department of Tax and Fee Administration (CDTFA).
Wilke Fleury is a thriving mid‐sized general practice law firm located in California’s capital. Our attorneys offer broad expertise, creativity, and strong ties to local businesses, families, and individuals, making Wilke Fleury one of the region’s most respected and long‐standing law firms. Our support of local charitable organizations, universities, law schools, political interests and the community reveals the character of the firm and our sincere commitment to the Sacramento region.
David has extensive and broad experience in the areas of complex civil litigation, with particular emphasis on the representation of residential and commercial property owners in construction-related disputes. David represents homeowners, homeowner associations, developers and contractors in real estate cases, as well as complex construction defect claims involving multiple single-family residences and multi-unit developments.
Wilke Fleury is pleased to announce its inclusion in the 2018 editions of ‘Best Law Firms’ in America and ‘Best Lawyers’ in America. The two award categories reflect excellence in legal service – firms included in the 2018 “Best Law Firms” list are recognized for professional excellence by clients and peers and Best Lawyers® has become universally regarded as the definitive guide to legal excellence.
Wilke Fleury Recognized in U.S. News 2018 Edition ‘Best Law Firms’ in America
Wilke Fleury is honored to be recognized among the nation’s Best Law Firms by U.S. News – Best Lawyers.
“Firms included in the 2018 “Best Law Firms” list are recognized for professional excellence with persistently impressive ratings from clients and peers. Achieving a tiered ranking signals a unique combination of quality law practice and breadth of legal expertise.”
Wilke Fleury Attorneys Elected to U.S. News 2018 Edition ‘Best Lawyers’ in America
David has extensive and broad experience in the areas of complex civil litigation, with particular emphasis on the representation of residential and commercial property owners in construction-related disputes. David represents homeowners, homeowner associations, developers and contractors in real estate cases, as well as complex construction defect claims involving multiple single-family residences and multi-unit developments.
Ernest James Krtil – Closely Held Companies and Family Business Law
Jim’s depth of experience in his practice emphasizes business law including mergers and acquisitions, nonprofit organization law and taxation, as well as estate planning and probate and trust administration, including trust and estate disputes.
California employers can establish workplace conduct policies and discipline employees who fail to comply with them. Employers also have to engage in an interactive process with employees who have a disability to explore reasonable accommodations, if any, to address work limitations from the disability. However, an employer’s duty to reasonably accommodate an employee’s disability is prospective, meaning that employees are not excused for their past bad conduct just because a disability may have contributed to it when the employer was unaware of the disability at the time the transgressions occurred. A recent case is instructive.
In Alamillo v. BNSF Railway Company (9th Cir., Aug. 25, 2017), 2017 WL 3648514, an employee sued his employer under California law for wrongful termination based on disability, failure to accommodate his disability, and failure to engage in the interactive process. The employee had ten unexcused absences during the year. While the discipline process for the most recent unexcused absences was ongoing, the employee was diagnosed with obstructive sleep apnea (OSA). The company accommodated the OSA prospectively, but did not excuse the employee for the unexcused absences before it learned about the OSA. As to them, the discipline process continued and the employee was ultimately terminated when the discipline process finished because of the past attendance violations. The court of appeal upheld the employee’s termination because there could be no failure to engage in the interactive process after the violations had already taken place and because no reasonable accommodation could fix the past absenteeism since reasonable accommodations are prospective.
As this case reminds us, employers do not have to change or excuse employee transgressions that occur before the employer knows about a disability. Rather, once an employer learns that an employee has a disability, the employer should work with the employee to prospectively address any limitations from it, but past transgressions remain and may subject the employee to discipline notwithstanding the disability.
On August 31, 2017, Senior Judge Lynn J. Bush of the United States Court of Federal Claims issued a $4,000,000 judgment against the United States in favor of Magnus Pacific Corporation, a Wilke Fleury client and one of the leading geotechnical contractors in the country.
Magnus Pacific’s claims arose out of levee restoration work performed for the United States Section of the International Boundary and Water Commission (USIBWC) along the Rio Grande River near Presidio, Texas.
Magnus Pacific’s work took place from approximately April of 2011 through May of 2012, and was performed pursuant to a contract entered into with the USIBWC. During the course of the project, Magnus Pacific encountered site conditions that differed significantly from those depicted in the project plans and specifications. Those differing conditions led to significant additional work, and associated cost overruns. Magnus Pacific requested the USIBWC’s voluntary payment of those additional costs, but those requests were rejected.
Upon completion of the project, and successful construction of the levee under extraordinarily difficult conditions, Magnus Pacific submitted “certified claims” to the USIBWC, again requesting payment of the additional costs incurred. Once again, those claims were rejected. Therefore, on October 31, 2013, Wilke Fleury partner Dan Baxter filed a lawsuit in the Court of Federal Claims, advancing three claims on Magnus Pacific’s behalf, and seeking approximately $4,000,000 in damages. After the completion of significant written discovery, and over a dozen depositions occurring in California, Texas, Mississippi, Arizona, and Massachusetts, a three-week trial took place in August and September of 2016. At trial, Magnus Pacific was represented by Dan Baxter, assisted by Wilke Fleury paralegal Sharon Brazell. The United States was represented by three lawyers and two paralegals from the Department of Justice. After trial, the parties engaged in extensive post-trial briefing, and the case was submitted for decision on January 17, 2017.
On August 31, Judge Bush issued a 110-page reported decision and associated judgment. Judge Bush found in Magnus Pacific’s favor on all three claims, and awarded Magnus Pacific the principal amount of $3,879,919, plus interest on approximately 3/4ths of that amount. With such interest, the amount awarded exceeds $4,000,000.
Wilke Fleury is proud of its association with Magnus Pacific (now Great Lakes Environmental and Infrastructure), and pleased at the opportunity to secure a successful outcome for its longstanding client.
The voting for Professional Research Services’ survey to determine the top attorneys in 2017 for Sacramento Magazine was open to all licensed attorneys in Sacramento, Calif. Attorneys were asked whom they would recommend among 56 legal specialties, other than themselves, in the Sacramento area. Each attorney was allowed to recommend up to three colleagues in each given legal specialty. Once the online nominations were complete, each nominee was carefully evaluated on the basis of the survey results, the legitimacy of their license, and their current standing with the State Bar of California. Attorneys who received the highest number of votes in each specialty are reflected in the following list. ~ Sacramento Magazine
Wilke Fleury is thrilled to announce our 2017 Super Lawyers and Rising Stars! Twelve of our talented attorneys have been honored with the Super Lawyers distinction and an additional four attorneys were honored with the Rising Stars distinction.
Super Lawyers® is a service of the Thomson Reuters, Legal Division. Each year, the research team at Super Lawyers® undertakes a rigorous multi-phase selection process that includes a statewide survey of lawyers, independent evaluation of candidates by the attorney-led research staff, a peer review of candidates by practice area and a good-standing and disciplinary check. The Super Lawyers list represents only five percent of lawyers in California and Rising Stars reflects 2.5% of the state’s up-and-coming lawyers.
Congratulations to Wilke Fleury’s 2017 Super Lawyers and Rising Stars!
“A special-needs trust is a family’s most important tool in making plans to pay for care. Key government benefits like Medi-Cal and SSI are restricted when a person with special needs has assets of more than $2,000. But special-needs trusts are a bucket into which family members and others can deposit an unlimited amount of money for a range of eligible expenses for their family member, like clothes, furniture, a car or education. The government doesn’t count such a special-needs trust as part of their assets.” – Steven Yoder, Comstocks
Check out our latest Video Blog on Transgender Employee Bathroom Access Rights in California.
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“A special-needs trust is a family’s most important tool in making plans to pay for care. Key government benefits like Medi-Cal and SSI are restricted when a person with special needs has assets of more than $2,000. But special-needs trusts are a bucket into which family members and others can deposit an unlimited amount of money for a range of eligible expenses for their family member, like clothes, furniture, a car or education. The government doesn’t count such a special-needs trust as part of their assets.” – Steven Yoder, Comstocks
