Amended in Assembly August 30, 2013

Amended in Senate April 15, 2013

Senate BillNo. 46


Introduced by Senator Corbett

December 14, 2012


An act to amend Sections 1798.29 and 1798.82 of the Civil Code, relating to personal information.

LEGISLATIVE COUNSEL’S DIGEST

SB 46, as amended, Corbett. Personal information: privacy.

Existing law requires any agency, and any person or business conducting business in California, that owns or licenses computerized data that includes personal information, as defined, to disclose in specified ways, any breach of the security of the system or data, as defined, following discovery or notification of the security breach, to any California resident whose unencrypted personal information was, or is reasonably believed to have been, acquired by an unauthorized person. Existing law defines “personal information” for these purposes, to include an individual’s first name and last name, or first initial and last name, in combination with one or more designated data elements relating to, among other things, social security numbers, driver’s license numbers, financial accounts, and medical information.

This bill would revise certain data elements included within the definition of personal information, by adding certain information that would permit access to an online account.

begin insert

This bill would impose additional requirements on the disclosure of a breach of the security of the system or data in situations where the breach involves personal information that would permit access to an online or email account.

end insert
begin insert

This bill would incorporate additional changes to Section 1798.29 of the Civil Code proposed by AB 1149 that would become operative if this bill and AB 1149 are enacted and this bill is enacted last.

end insert

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 1798.29 of the Civil Code is amended
2to read:

3

1798.29.  

(a) Any agency that owns or licenses computerized
4data that includes personal information shall disclose any breach
5of the security of the system following discovery or notification
6of the breach in the security of the data to any resident of California
7whose unencrypted personal information was, or is reasonably
8believed to have been, acquired by an unauthorized person. The
9disclosure shall be made in the most expedient time possible and
10without unreasonable delay, consistent with the legitimate needs
11of law enforcement, as provided in subdivision (c), or any measures
12necessary to determine the scope of the breach and restore the
13reasonable integrity of the data system.

14(b) Any agency that maintains computerized data that includes
15personal information that the agency does not own shall notify the
16owner or licensee of the information of any breach of the security
17of the data immediately following discovery, if the personal
18information was, or is reasonably believed to have been, acquired
19by an unauthorized person.

20(c) The notification required by this section may be delayed if
21a law enforcement agency determines that the notification will
22impede a criminal investigation. The notification required by this
23section shall be made after the law enforcement agency determines
24that it will not compromise the investigation.

25(d) Any agency that is required to issue a security breach
26notification pursuant to this section shall meet all of the following
27requirements:

28(1) The security breach notification shall be written in plain
29language.

30(2) The security breach notification shall include, at a minimum,
31the following information:

P3    1(A) The name and contact information of the reporting agency
2subject to this section.

3(B) A list of the types of personal information that were or are
4reasonably believed to have been the subject of a breach.

5(C) If the information is possible to determine at the time the
6notice is provided, then any of the following: (i) the date of the
7breach, (ii) the estimated date of the breach, or (iii) the date range
8within which the breach occurred. The notification shall also
9include the date of the notice.

10(D) Whether the notification was delayed as a result of a law
11enforcement investigation, if that information is possible to
12determine at the time the notice is provided.

13(E) A general description of the breach incident, if that
14information is possible to determine at the time the notice is
15provided.

16(F) The toll-free telephone numbers and addresses of the major
17credit reporting agencies, if the breach exposed a social security
18number or a driver’s license or California identification card
19number.

20(3) At the discretion of the agency, the security breach
21notification may also include any of the following:

22(A) Information about what the agency has done to protect
23individuals whose information has been breached.

24(B) Advice on steps that the person whose information has been
25breached may take to protect himself or herself.

begin insert

26(4) In the case of a breach of the security of the system involving
27personal information defined in paragraph (2) of subdivision (g)
28for an online account, and no other personal information defined
29in paragraph (1) of subdivision (g), the agency may comply with
30this section by providing the security breach notification in
31electronic or other form that directs the person whose personal
32information has been breached to promptly change his or her
33password and security question or answer, as applicable, or to
34take other steps appropriate to protect the online account with the
35agency and all other online accounts for which the person uses
36the same user name or email address and password or security
37question or answer.

end insert
begin insert

38(5) In the case of a breach of the security of the system involving
39personal information defined in paragraph (2) of subdivision (g)
40for login credentials of an email account furnished by the agency,
P4    1the agency shall not comply with this section by providing the
2security breach notification to that email address, but may, instead,
3comply with this section by providing notice by another method
4described in subdivision (i) or by clear and conspicuous notice
5delivered to the resident online when the resident is connected to
6the online account from an Internet Protocol address or online
7 location from which the agency knows the resident customarily
8accesses the account.

end insert

9(e) Any agency that is required to issue a security breach
10notification pursuant to this section to more than 500 California
11residents as a result of a single breach of the security system shall
12 electronically submit a single sample copy of that security breach
13notification, excluding any personally identifiable information, to
14the Attorney General. A single sample copy of a security breach
15notification shall not be deemed to be within subdivision (f) of
16Section 6254 of the Government Code.

17(f) For purposes of this section, “breach of the security of the
18system” means unauthorized acquisition of computerized data that
19compromises the security, confidentiality, or integrity of personal
20information maintained by the agency. Good faith acquisition of
21personal information by an employee or agent of the agency for
22the purposes of the agency is not a breach of the security of the
23system, provided that the personal information is not used or
24subject to further unauthorized disclosure.

25(g) For purposes of this section, “personal information” means
26either of the following:

27(1) An individual’s first name or first initial and last name in
28combination with any one or more of the following data elements,
29when either the name or the data elements are not encrypted:

30(A) Social security number.

31(B) Driver’s license number or Californiabegin delete Identification Cardend delete
32begin insert identification card end insert number.

33(C) Account number, credit or debit card number, in
34combination with any required security code, access code, or
35password that would permit access to an individual’s financial
36account.

37(D) Medical information.

38(E) Health insurance information.

P5    1(2) A user name or email address, in combination with a
2password or security question and answer that would permit access
3to an online account.

4(h) (1) For purposes of this section, “personal information”
5does not include publicly available information that is lawfully
6made available to the general public from federal, state, or local
7government records.

8(2) For purposes of this section, “medical information” means
9any information regarding an individual’s medical history, mental
10or physical condition, or medical treatment or diagnosis by a health
11care professional.

12(3) For purposes of this section, “health insurance information”
13means an individual’s health insurance policy number or subscriber
14identification number, any unique identifier used by a health insurer
15to identify the individual, or any information in an individual’s
16application and claims history, including any appeals records.

17(i) For purposes of this section, “notice” may be provided by
18one of the following methods:

19(1) Written notice.

20(2) Electronic notice, if the notice provided is consistent with
21the provisions regarding electronic records and signatures set forth
22in Section 7001 of Title 15 of the United States Code.

23(3) Substitute notice, if the agency demonstrates that the cost
24of providing notice would exceed two hundred fifty thousand
25dollars ($250,000), or that the affected class of subject persons to
26be notified exceeds 500,000, or the agency does not have sufficient
27contact information. Substitute notice shall consist of all of the
28following:

29(A) Email notice when the agency has an email address for the
30subject persons.

31(B) Conspicuous posting of the notice on the agency’s Internet
32Web site page, if the agency maintains one.

33(C) Notification to major statewide media and the Office of
34Information Security within thebegin delete California Technology Agency.end delete
35begin insert Department of Technology.end insert

36(j) Notwithstanding subdivision (i), an agency that maintains
37its own notification procedures as part of an information security
38policy for the treatment of personal information and is otherwise
39consistent with the timing requirements of this part shall be deemed
40to be in compliance with the notification requirements of this
P6    1section if it notifies subject persons in accordance with its policies
2in the event of a breach of security of the system.

3begin insert

begin insertSEC. 1.5.end insert  

end insert

begin insertSection 1798.29 of the end insertbegin insertCivil Codeend insertbegin insert is amended to
4read:end insert

5

1798.29.  

(a) Any agency that owns or licenses computerized
6data that includes personal information shall disclose any breach
7of the security of the system following discovery or notification
8of the breach in the security of the data to any resident of California
9whose unencrypted personal information was, or is reasonably
10believed to have been, acquired by an unauthorized person. The
11disclosure shall be made in the most expedient time possible and
12without unreasonable delay, consistent with the legitimate needs
13of law enforcement, as provided in subdivision (c), or any measures
14necessary to determine the scope of the breach and restore the
15reasonable integrity of the data system.

16(b) Any agency that maintains computerized data that includes
17personal information that the agency does not own shall notify the
18owner or licensee of the information of any breach of the security
19of the data immediately following discovery, if the personal
20information was, or is reasonably believed to have been, acquired
21by an unauthorized person.

22(c) The notification required by this section may be delayed if
23a law enforcement agency determines that the notification will
24impede a criminal investigation. The notification required by this
25section shall be made after the law enforcement agency determines
26that it will not compromise the investigation.

27(d) Any agency that is required to issue a security breach
28notification pursuant to this section shall meet all of the following
29requirements:

30(1) The security breach notification shall be written in plain
31language.

32(2) The security breach notification shall include, at a minimum,
33the following information:

34(A) The name and contact information of the reporting agency
35subject to this section.

36(B) A list of the types of personal information that were or are
37reasonably believed to have been the subject of a breach.

38(C) If the information is possible to determine at the time the
39notice is provided, then any of the following: (i) the date of the
40breach, (ii) the estimated date of the breach, or (iii) the date range
P7    1within which the breach occurred. The notification shall also
2include the date of the notice.

3(D) Whether the notification was delayed as a result of a law
4enforcement investigation, if that information is possible to
5determine at the time the notice is provided.

6(E) A general description of the breach incident, if that
7information is possible to determine at the time the notice is
8provided.

9(F) The toll-free telephone numbers and addresses of the major
10credit reporting agencies, if the breach exposed a social security
11number or a driver’s license or California identification card
12number.

13(3) At the discretion of the agency, the security breach
14notification may also include any of the following:

15(A) Information about what the agency has done to protect
16individuals whose information has been breached.

17(B) Advice on steps that the person whose information has been
18breached may take to protect himself or herself.

begin insert

19(4) In the case of a breach of the security of the system involving
20personal information defined in paragraph (2) of subdivision (g)
21for an online account, and no other personal information defined
22in paragraph (1) of subdivision (g), the agency may comply with
23this section by providing the security breach notification in
24electronic or other form that directs the person whose personal
25information has been breached to promptly change his or her
26password and security question or answer, as applicable, or to
27take other steps appropriate to protect the online account with the
28agency and all other online accounts for which the person uses
29the same user name or email address and password or security
30question or answer.

end insert
begin insert

31(5) In the case of a breach of the security of the system involving
32personal information defined in paragraph (2) of subdivision (g)
33for login credentials of an email account furnished by the agency,
34the agency shall not comply with this section by providing the
35security breach notification to that email address, but may, instead,
36comply with this section by providing notice by another method
37described in subdivision (i) or by clear and conspicuous notice
38delivered to the resident online when the resident is connected to
39the online account from an Internet Protocol address or online
P8    1location from which the agency knows the resident customarily
2accesses the account.

end insert

3(e) Any agency that is required to issue a security breach
4notification pursuant to this section to more than 500 California
5residents as a result of a single breach of the security system shall
6 electronically submit a single sample copy of that security breach
7notification, excluding any personally identifiable information, to
8the Attorney General. A single sample copy of a security breach
9notification shall not be deemed to be within subdivision (f) of
10Section 6254 of the Government Code.

11(f) For purposes of this section, “breach of the security of the
12system” means unauthorized acquisition of computerized data that
13compromises the security, confidentiality, or integrity of personal
14information maintained by the agency. Good faith acquisition of
15personal information by an employee or agent of the agency for
16the purposes of the agency is not a breach of the security of the
17system, provided that the personal information is not used or
18subject to further unauthorized disclosure.

19(g) For purposes of this section, “personal information” means
20begin delete anend deletebegin insert either of the following:end insert

21begin insert(1)end insertbegin insertend insertbegin insertAnend insert individual’s first name or first initial and last name in
22combination with any one or more of the following data elements,
23when either the name or the data elements are not encrypted:

begin delete

24(1)

end delete

25begin insert(A)end insert Social security number.

begin delete

26(2)

end delete

27begin insert(B)end insert Driver’s license number or Californiabegin delete Identification Cardend delete
28begin insert identification cardend insert number.

begin delete

29(3)

end delete

30begin insert(C)end insert Account number, credit or debit card number, in
31combination with any required security code, access code, or
32password that would permit access to an individual’s financial
33account.

begin delete

34(4)

end delete

35begin insert(D)end insert Medical information.

begin delete

36(5)

end delete

37begin insert(E)end insert Health insurance information.

begin insert

38(2) A user name or email address, in combination with a
39password or security question and answer that would permit access
40to an online account.

end insert

P9    1(h) (1) For purposes of this section, “personal information”
2does not include publicly available information that is lawfully
3made available to the general public from federal, state, or local
4government records.

5(2) For purposes of this section, “medical information” means
6any information regarding an individual’s medical history, mental
7or physical condition, or medical treatment or diagnosis by a health
8care professional.

9(3) For purposes of this section, “health insurance information”
10means an individual’s health insurance policy number or subscriber
11identification number, any unique identifier used by a health insurer
12to identify the individual, or any information in an individual’s
13application and claims history, including any appeals records.

14(i) For purposes of this section, “notice” may be provided by
15one of the following methods:

16(1) Written notice.

17(2) Electronic notice, if the notice provided is consistent with
18the provisions regarding electronic records and signatures set forth
19in Section 7001 of Title 15 of the United States Code.

20(3) Substitute notice, if the agency demonstrates that the cost
21of providing notice would exceed two hundred fifty thousand
22dollars ($250,000), or that the affected class of subject persons to
23be notified exceeds 500,000, or the agency does not have sufficient
24contact information. Substitute notice shall consist of all of the
25following:

26(A) begin deleteE-mail end deletebegin insertEmail end insertnotice when the agency has anbegin delete e-mailend deletebegin insert emailend insert
27 address for the subject persons.

28(B) Conspicuous posting of the notice on the agency’s Internet
29Web site page, if the agency maintains one.

30(C) Notification to major statewide media and the Office of
31Information Security within thebegin delete California Technology Agency.end delete
32begin insert Department of Technology.end insert

33(j) Notwithstanding subdivision (i), an agency that maintains
34its own notification procedures as part of an information security
35policy for the treatment of personal information and is otherwise
36consistent with the timing requirements of this part shall be deemed
37to be in compliance with the notification requirements of this
38section if it notifies subject persons in accordance with its policies
39in the event of a breach of security of the system.

begin insert

P10   1(k) Notwithstanding the exception specified in paragraph (4)
2of subdivision (b) of Section 1798.3, for purposes of this section,
3“agency” includes a local agency, as defined in subdivision (a)
4of Section 6252 of the Government Code.

end insert
5

SEC. 2.  

Section 1798.82 of the Civil Code is amended to read:

6

1798.82.  

(a) Any person or business that conducts business
7in California, and that owns or licenses computerized data that
8includes personal information, shall disclose any breach of the
9security of the system following discovery or notification of the
10breach in the security of the data to any resident of California
11whose unencrypted personal information was, or is reasonably
12believed to have been, acquired by an unauthorized person. The
13disclosure shall be made in the most expedient time possible and
14without unreasonable delay, consistent with the legitimate needs
15of law enforcement, as provided in subdivision (c), or any measures
16necessary to determine the scope of the breach and restore the
17reasonable integrity of the data system.

18(b) Any person or business that maintains computerized data
19that includes personal information that the person or business does
20not own shall notify the owner or licensee of the information of
21any breach of the security of the data immediately following
22discovery, if the personal information was, or is reasonably
23believed to have been, acquired by an unauthorized person.

24(c) The notification required by this section may be delayed if
25a law enforcement agency determines that the notification will
26impede a criminal investigation. The notification required by this
27section shall be made after the law enforcement agency determines
28that it will not compromise the investigation.

29(d) Any person or business that is required to issue a security
30breach notification pursuant to this section shall meet all of the
31following requirements:

32(1) The security breach notification shall be written in plain
33language.

34(2) The security breach notification shall include, at a minimum,
35the following information:

36(A) The name and contact information of the reporting person
37or business subject to this section.

38(B) A list of the types of personal information that were or are
39 reasonably believed to have been the subject of a breach.

P11   1(C) If the information is possible to determine at the time the
2notice is provided, then any of the following: (i) the date of the
3breach, (ii) the estimated date of the breach, or (iii) the date range
4within which the breach occurred. The notification shall also
5include the date of the notice.

6(D) Whether notification was delayed as a result of a law
7enforcement investigation, if that information is possible to
8determine at the time the notice is provided.

9(E) A general description of the breach incident, if that
10information is possible to determine at the time the notice is
11provided.

12(F) The toll-free telephone numbers and addresses of the major
13credit reporting agencies if the breach exposed a social security
14number or a driver’s license or California identification card
15number.

16(3) At the discretion of the person or business, the security
17breach notification may also include any of the following:

18(A) Information about what the person or business has done to
19protect individuals whose information has been breached.

20(B) Advice on steps that the person whose information has been
21breached may take to protect himself or herself.

begin insert

22(4) In the case of a breach of the security of the system involving
23personal information defined in paragraph (2) of subdivision (h)
24for an online account, and no other personal information defined
25in paragraph (1) of subdivision (h), the person or business may
26comply with this section by providing the security breach
27notification in electronic or other form that directs the person
28whose personal information has been breached promptly to change
29his or her password and security question or answer, as applicable,
30or to take other steps appropriate to protect the online account
31with the person or business and all other online accounts for which
32the person whose personal information has been breached uses
33the same user name or email address and password or security
34question or answer.

end insert
begin insert

35(5) In the case of a breach of the security of the system involving
36personal information defined in paragraph (2) of subdivision (h)
37for login credentials of an email account furnished by the person
38or business, the person or business shall not comply with this
39section by providing the security breach notification to that email
40address, but may, instead, comply with this section by providing
P12   1 notice by another method described in subdivision (j) or by clear
2and conspicuous notice delivered to the resident online when the
3resident is connected to the online account from an Internet
4Protocol address or online location from which the person or
5business knows the resident customarily accesses the account.

end insert

6(e) A covered entity under the federal Health Insurance
7Portability and Accountability Act of 1996 (42 U.S.C. Sec. 1320d
8et seq.) will be deemed to have complied with the notice
9requirements in subdivision (d) if it has complied completely with
10Section 13402(f) of the federal Health Information Technology
11for Economic and Clinical Health Act (Public Law 111-5).
12However, nothing in this subdivision shall be construed to exempt
13a covered entity from any other provision of this section.

14(f) Any person or business that is required to issue a security
15breach notification pursuant to this section to more than 500
16California residents as a result of a single breach of the security
17system shall electronically submit a single sample copy of that
18security breach notification, excluding any personally identifiable
19information, to the Attorney General. A single sample copy of a
20security breach notification shall not be deemed to be within
21subdivision (f) of Section 6254 of the Government Code.

22(g) For purposes of this section, “breach of the security of the
23system” means unauthorized acquisition of computerized data that
24compromises the security, confidentiality, or integrity of personal
25information maintained by the person or business. Good faith
26acquisition of personal information by an employee or agent of
27the person or business for the purposes of the person or business
28is not a breach of the security of the system, provided that the
29personal information is not used or subject to further unauthorized
30disclosure.

31(h) For purposes of this section, “personal information” means
32either of the following:

33(1) An individual’s first name or first initial and last name in
34 combination with any one or more of the following data elements,
35when either the name or the data elements are not encrypted:

36(A) Social security number.

37(B) Driver’s license number or Californiabegin delete Identification Cardend delete
38begin insert identification card end insert number.

39(C) Account number, credit or debit card number, in
40combination with any required security code, access code, or
P13   1password that would permit access to an individual’s financial
2account.

3(D) Medical information.

4(E) Health insurance information.

5(2) A user name or email address, in combination with a
6password or security question and answer that would permit access
7to an online account.

8(i) (1) For purposes of this section, “personal information” does
9not include publicly available information that is lawfully made
10available to the general public from federal, state, or local
11government records.

12(2) For purposes of this section, “medical information” means
13any information regarding an individual’s medical history, mental
14or physical condition, or medical treatment or diagnosis by a health
15care professional.

16(3) For purposes of this section, “health insurance information”
17means an individual’s health insurance policy number or subscriber
18identification number, any unique identifier used by a health insurer
19to identify the individual, or any information in an individual’s
20application and claims history, including any appeals records.

21(j) For purposes of this section, “notice” may be provided by
22one of the following methods:

23(1) Written notice.

24(2) Electronic notice, if the notice provided is consistent with
25the provisions regarding electronic records and signatures set forth
26in Section 7001 of Title 15 of the United States Code.

27(3) Substitute notice, if the person or business demonstrates that
28the cost of providing notice would exceed two hundred fifty
29thousand dollars ($250,000), or that the affected class of subject
30persons to be notified exceeds 500,000, or the person or business
31does not have sufficient contact information. Substitute notice
32shall consist of all of the following:

33(A) Email notice when the person or business has an email
34address for the subject persons.

35(B) Conspicuous posting of the notice on the Internet Web site
36page of the person or business, if the person or business maintains
37one.

38(C) Notification to major statewidebegin delete media and the Office of
39Privacy Protection within the State and Consumer Services Agency.end delete

40begin insert media.end insert

P14   1(k) Notwithstanding subdivision (j), a person or business that
2maintains its own notification procedures as part of an information
3security policy for the treatment of personal information and is
4otherwise consistent with the timing requirements of this part, shall
5be deemed to be in compliance with the notification requirements
6of this section if the person or business notifies subject persons in
7accordance with its policies in the event of a breach of security of
8the system.

9begin insert

begin insertSEC. 3.end insert  

end insert
begin insert

Section 1.5 of this bill incorporates amendments to
10Section 1798.29 of the Civil Code proposed by both this bill and
11Assembly Bill 1149. It shall only become operative if (1) both bills
12are enacted and become effective on or before January 1, 2014,
13(2) each bill amends Section 1798.29 of the Civil Code, and (3)
14this bill is enacted after Assembly Bill 1149, in which case Section
151 of this bill shall not become operative.

end insert


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    97