BILL NUMBER: AB 2667 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 15, 2014
AMENDED IN ASSEMBLY APRIL 24, 2014
AMENDED IN ASSEMBLY MARCH 27, 2014
INTRODUCED BY Assembly Member Bloom
FEBRUARY 21, 2014
An act to amend Section 1812.622 of, and to add Section 1812.650
to, the Civil Code, relating to electronic devices.
LEGISLATIVE COUNSEL'S DIGEST
AB 2667, as amended, Bloom. Rental-purchase agreements: electronic
devices: monitoring technology.
Existing law, the Karnette Rental-Purchase Act, provides for the
regulation of rental-purchase agreements, as defined. Existing law
requires rental-purchase agreements to contain specified notices,
including, among other things, information on costs and terms of
payment. Existing law makes it a misdemeanor to willfully violate the
provisions regulating rental-purchase agreements.
This bill would add to these provisions regulating rental-purchase
agreements provisions requiring a lessor to provide clear and
prominent notice to a consumer and obtain express consent from the
consumer at the time the lessor and the consumer enter into a
rental-purchase agreement for an electronic device if that device has
geophysical location tracking technology installed by the
lessor and would prohibit a lessor from installing the
technology without providing clear and prominent notice and obtaining
express consent from the consumer. The bill would prohibit a lessor
from using, selling, or sharing geophysical location tracking
technology on an electronic device for any purpose other than
to prevent fraud or loss the repossession of
the electronic device when there is a violation of the
rental-purchase agreement, pursuant to the law, or when requested by
the consumer . The bill would prohibit a lessor from using or
installing monitoring technology on an electronic device for any
purpose other than to provide remote technical assistance when
requested by the consumer . The bill would provide for the
expiration of and notification related to geophysical location
tracking technology. The bill would provide for remote
technical assistance, as specified.
Because a willful violation of these provisions would be a crime,
this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1812.622 of the Civil Code is amended to read:
1812.622. As used in this title:
(a) "Advertisement" means a commercial message in any medium that
directly or indirectly solicits or promotes one or more specific
rental-purchase transactions, excluding instore merchandising aids.
This definition does not limit or alter the application of other
laws, including Chapter 5 (commencing with Section 17200) of Part 2
and Chapter 1 (commencing with Section 17500) of Part 3, of Division
7 of the Business and Professions Code, to rental-purchase
transactions.
(b) "Consumer" means a natural person or persons who rent or lease
personal property from a lessor pursuant to a rental-purchase
agreement or to whom a lessor offers personal property for use
pursuant to a rental-purchase agreement.
(c) "Lessor" means any person or entity that provides or offers to
provide personal property for use by consumers pursuant to a
rental-purchase agreement.
(d) "Rental-purchase agreement," except as otherwise provided in
this subdivision, means an agreement between a lessor and a consumer
pursuant to which the lessor rents or leases, for valuable
consideration, personal property for use by a consumer for personal,
family, or household purposes for an initial term not exceeding four
months that may be renewed or otherwise extended, if under the terms
of the agreement the consumer acquires an option or other legally
enforceable right to become owner of the property. A rental-purchase
agreement is a lease subject to Title 1.5 (commencing with Section
1750) and Title 1.7 (commencing with Section 1790).
"Rental-purchase agreement" shall not be construed to be, nor be
governed by, and shall not apply to, any of the following:
(1) A retail installment sale, as defined in Section 1802.5.
(2) A retail installment contract, as defined in Section 1802.6.
(3) A retail installment account, as defined in Section 1802.7.
(4) A lease or agreement that constitutes a security interest, as
defined in Section 1201 of the Commercial Code.
(5) A consumer credit contract, as defined in Section 1799.90.
(e) "Cash price" means the price of the personal property
described in the rental-purchase agreement that the consumer may pay
in cash to the lessor at the inception of the rental-purchase
agreement to acquire ownership of that personal property.
(f) "Cost of rental" means the difference between the total of all
periodic payments necessary to acquire ownership under the
rental-purchase agreement and the cash price of the rental property
that is subject to the rental-purchase agreement.
(g) "Fee" means any payment, charge, fee, cost, or expense,
however denominated, other than a rental payment.
(h) "Appliance" means and includes any refrigerator, freezer,
range including any cooktop or oven, microwave oven, washer, dryer,
dishwasher, or room air-conditioner or air purifier.
(i) "Electronic set" means and includes any television, radio,
camera, video game, or any type of device for the recording, storage,
copying, printing, transmission, display, or playback of any sound
or image, but does not include any item that is part of a computer
system.
(j) "Computer system" means a computer processor and a video
monitor, printer, and peripheral items primarily designed for use
with a computer. Audio and video devices, which are commonly used for
entertainment and into which data may be downloaded from a computer,
are not part of a computer system.
(k) "Lessor's cost" means the documented actual cost, including
actual freight charges, of the rental property to the lessor from a
wholesaler, distributor, supplier, or manufacturer and net of any
discounts, rebates, and incentives.
( l ) "Total of payments" means the total amount of
periodic payments necessary to acquire ownership of the property that
is the subject of the rental-purchase agreement if the consumer
makes all regularly scheduled payments.
(m) "Electronic device" means a desktop or laptop computer,
handheld device, tablet, smart phone,
smartphone, or other electronic product or device that has a
platform on which to download, install, or run any software program,
code, script, or other content.
(n) "Clear and prominent notice" means notice presented in an
understandable language and syntax, in the predominantly used
language for that communication, and that:
(1) In textual communications, the required disclosures are
separate and apart from a privacy policy, data use policy, terms of
service, end-user license agreement, lease agreement, or other
similar document, and of a type, size, and location sufficiently
noticeable for an ordinary consumer to read and comprehend in print
that contrasts highly with the background on which they appear.
(2) In communications disseminated orally or through audible
means, the required disclosures are delivered in a volume and cadence
sufficient for an ordinary consumer to hear and comprehend.
(3) In communications disseminated through video means, the
required disclosures are in writing in a form consistent with
paragraph (1) and appear on the screen for a duration sufficient for
an ordinary consumer to read and comprehend them, and in the same
language as the predominantly used language for that communication.
(4) In communications made through interactive media, including
the Internet, online services, and software, the required disclosures
are unavoidable and presented in a form consistent with paragraph
(1), in addition to any audio or video presentation.
(o)
(n) "Geophysical location tracking technology" means
hardware, software, or an application that collects and reports data
or information that identifies the precise geophysical location of an
item, including, including
technologies that report the GPS coordinates of an electronic device,
the WiFi signals available to or actually used by an electronic
device to access the Internet, the telecommunication towers or
connections available to or actually used by a computer
an electronic device , the processing of any
reported data or information through geolocation lookup services, or
any information derived from any combination of the foregoing.
(p)
(o) "Monitoring technology" means any hardware,
software, or application utilized in conjunction with a
computer an electronic device that can cause the
computer electronic device to capture,
monitor, record, or report information about user activities
with or without the user's knowledge.
(q)
(p) "Remote technical assistance" means collaborative
access by the user and technician to connect to an electronic device
for the purpose of providing technical support to the user.
(r)
(q) "Express consent" means a clear choice to
either agree or not agree to any the affirmative
agreement to any use or installation of geophysical location
tracking technology or remote technical assistance. Express consent
does not include consent given when either option is highlighted or
preselected as a default setting.
(s) "Fraud" means an action by the consumer that necessitates the
lessor's recovery of the electronic device, limited to nonpayment or
another breach of the rental-purchase agreement.
SEC. 2. Section 1812.650 is added to the Civil Code, to read:
1812.650. (a) A lessor shall provide clear and prominent notice
to a consumer and obtain express consent from the consumer at the
time the lessor and the consumer enter into a rental-purchase
agreement for an electronic device if that device has geophysical
location tracking technology installed by the lessor , and
at any time the geophysical location tracking technology is
activated. A lessor shall not install geophysical location tracking
technology on an electronic device without first providing clear and
prominent notice to the consumer and obtaining express consent
activated or used by the lessor .
(b) For purposes of this section, "clear and prominent notice"
means notice presented in an understandable language and syntax, in
the predominantly used language for that communication, and that:
(1) In textual communications, the required disclosures are
separate and apart from a privacy policy, data use policy, terms of
service, end-user license agreement, lease agreement, or other
similar document, and of a type, size, and location sufficiently
noticeable for an ordinary consumer to read and comprehend in print
that contrasts highly with the background on which they appear.
(2) In communications disseminated orally or through audible
means, the required disclosures are delivered in a volume and cadence
sufficient for an ordinary consumer to hear and comprehend.
(3) In communications disseminated through video means, the
required disclosures are in writing in a form consistent with
paragraph (1) and appear on the screen for a duration sufficient for
an ordinary consumer to read and comprehend them, and in the same
language as the predominantly used language for that communication.
(4) In communications made through interactive media, including
the Internet, online services, and software, the required disclosures
are unavoidable and presented in a form consistent with paragraph
(1), in addition to any audio or video presentation.
(b)
(c) A lessor shall not use, sell, or share geophysical
location tracking technology on an electronic device for any purpose
other than the prevention of fraud or loss
repossession of the electronic device when there is a violation of
the rental-purchase agreement, pursuant to law, or when requested by
the consumer .
(c)
(d) Clear and prominent notification shall be displayed
on an electronic device if geophysical location tracking technology
is activated or used by the lessor. This notification
requirement shall be suspended if the consumer or lessor
reports that the electronic device has been stolen and has filed a
police report stating that the electronic device has been stolen. For
purposes of this subdivision, "filing a police report" means the
filing of a consumer's or lessor's complaint with the police
department in any form recognized by that jurisdiction .
(d)
(e) A lessor shall provide that any geophysical
location tracking technology that has been installed by the
lessor on an electronic device, or can be activated by the
lessor, expires following the lease period or upon
completion of the purchase of the electronic device
upon the first instance the electronic device connects to the
Internet after completion of the purchase of the electronic device
.
(e)
(f) A lessor shall not use or install monitoring
technology on an electronic device for any purpose other than to
provide remote technical assistance when requested by the consumer
.
(f)
(g) A lessor shall provide clear and prominent notice
to a consumer and obtain express consent from the consumer for the
installation or use of any software that allows the
use of lessor to provide remote
technical assistance and upon the activation and deactivation of any
remote technical assistance when requested by the consumer.
(g)
(h) A lessor shall not acquire any data when providing
remote technical assistance beyond what is necessary to provide
assistance to the user and beyond what the user has consented to. Any
data acquired during the period of consumer consented technical
assistance shall not be retained, used, or sold for any purpose.
(i) This section shall not be interpreted to require a lessor to
enter into a rental-purchase agreement with any consumer who does not
provide express consent to the provisions of above-described
provisions of the rental-purchase agreement.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.