BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 568
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          Date of Hearing:  August 13, 2013

                           ASSEMBLY COMMITTEE ON JUDICIARY
                                Bob Wieckowski, Chair
                   SB 568 (Steinberg) - As Amended: August 5, 2013

                              As Proposed to be Amended

           SENATE VOTE  :  37-0
          
          SUBJECT  :  Privacy: Internet: Minors

           KEY ISSUES  :  

          1)Should the operator of an Internet Website or online service  
            be prohibited from marketing or advertising products or  
            services to a minor under the AGe of 18, if the minor could  
            not legally purchase those products or services?  

          2)Should AN operator be required, upon request of a minor, to  
            remove or make anonymous content or information that the minor  
            has posted on the operator's website or service? 

           FISCAL EFFECT  :  As currently in print this bill is keyed  
          non-fiscal. 

                                      SYNOPSIS

          This author-sponsored bill responds to the pervasive use of the  
          Internet, online services, and mobile applications by minors.   
          It seeks to protect minors in two ways. First, the bill would  
          prohibit the operators of Internet Web sites, online services,  
          or applications that are directed at minors from marketing or  
          advertising products that minors cannot legally purchase, such  
          as alcohol and tobacco products.  On line operators that target  
          a more general adult audience would be prohibited from sending  
          such advertisements if they had actual knowledge that the user  
          is a minor.  Second, this measure would permit a minor to remove  
          information that has been publicly posted on the operator's  
          site, service, or application, reflecting the author's belief  
          that the immaturity of minors may cause them to sometimes  
          unwisely post material without fully reflecting on potential  
          consequences.  State law generally does not prohibit the kind of  
          information that Web sites, online services, and applications  
          can collect and share; rather it only requires very general  








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          disclosure of those policies.  A user's right to opt-out of data  
          collection and sharing, to block advertising, or to remove  
          content is generally dictated by the operator's unilateral  
          "terms and conditions."  This bill, by contrast, would require  
          that operators refrain from sending certain kinds of  
          advertisements to minors and allow minors to remove (or at least  
          hide or make anonymous) content that the minor has posted.   
          Federal law requires the operator of a service directed to  
          children under the age of 13 to give notice of the kinds of  
          information that is collected and how it is used, and it gives  
          parents the opportunity to opt-out of future collection of their  
          child's information.  The Center for Democracy & Technology  
          opposes this bill on First Amendment grounds and because, CDT  
          asserts, it will have various unwanted and unintended  
          consequences.  
           SUMMARY  :  Prohibits, as of January 1, 2015, the operator of  
          Internet website or online service, online application, or  
          mobile application from marketing certain kinds of products or  
          services to a minor, and permits a minor to remove posted  
          personal information, as specified.  Specifically,  this bill  :   

          1)Prohibits the operator of an Internet Web site, online  
            service, online application, or mobile application that is  
            directed to minors from marketing or advertising specified  
            products or services on its Internet Web site, online service,  
            online application, or mobile application.   If marketing or  
            advertising is provided by an advertising service, the  
            operator shall notify the advertising service that the site,  
            service, or application is directed to minors, and the  
            advertising service shall be prohibited from marketing or  
            advertising the specified products or services. 

          2)Prohibits the operator of an Internet Web site, online  
            service, or application from marketing or advertising  
            specified products or services to a minor if the operator has  
            actual knowledge that a minor is using the operator's Web  
            site, service, or application and the marketing or advertising  
            is specifically directed to that minor based on information  
            specific to that minor.  Provides that an operator shall be  
            deemed in compliance with this provision if the operator takes  
            reasonable actions in good faith to avoid marketing or  
            advertising the specified products or services.

          3)Prohibits an operator of an Internet Web site, online service,  
            or application directed to minors or who has actual knowledge  








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            that a minor is using the operator's site, service, or  
            application from using, disclosing, compiling, or allowing a  
            third party to use, disclose, or compile, the personal  
            information of a minor with actual knowledge that such use,  
            disclosure or compilation is for the purpose of marketing or  
            advertising specified products or services.

          4)Applies the above restrictions to the following products and  
            services, which existing law prohibits a minor from  
            purchasing: alcoholic beverages; firearms, handguns, or  
            ammunition; handgun safety certificates; aerosol paints or  
            etching creams that are capable of defacing property;  tobacco  
            products or controlled substances; BB devices; ultraviolet  
            tanning devices; dietary supplements containing ephedrine;  
            lottery tickets; salvia divinorum or Salvinorin A, or products  
            containing the same; body branding; permanent tattoo; drug  
            paraphernalia; electronic cigarettes; obscene matter; a less  
            lethal weapon, as defined.

          5)Specifies that the above restrictions shall not apply to  
            incidental placement of products or services embedded in  
            content if the content is not created primarily for the  
            purpose of marketing and advertising of the restricted  
            services and products. 

          6)Provides that nothing in this bill shall be construed to  
            require an operator of an Internet Web site, online service,  
            or application to collect or retain information about users. 

          7)Uses the following definitions for purposes of the provisions  
            of this bill:

             a)   "Minor" means a natural person less than 18 years of age  
               who resides in the state.

             b)   "Internet Web site, online service, online application,  
               or mobile application directed to minors" means a site,  
               service, or application that is created for the purpose of  
               reaching an audience that is predominantly composed of  
               minors, and is not intended for a more general audience  
               comprised of adults.  However, a site, service, or  
               application shall not be deemed to be directed to minors  
               solely because it refers or links to a site, service, or  
               application directed to minors. 









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             c)   "Marketing or advertising" means, in exchange for  
               monetary compensation, to make a communication to one or  
               more individuals, or to arrange for the dissemination to  
               the public of a communication, about a product or service  
               the primary purpose of which is to encourage recipients of  
               the communication to purchase or use the product or  
               service. 

             d)   "Operator" means any person or entity that owns an  
               Internet Web site, online service, online application, or  
               mobile application.  It does not include any third party  
               that operates, hosts, or manages, but does not own, an  
               Internet Web site, online service, online application, or  
               mobile application on the owner's behalf or processes  
               information on the owner's behalf. 

          8)Requires an operator of a Web site, online service or  
            application directed to minors, or an operator that has actual  
            knowledge that a minor is using the site, service, or  
            application, to permit a minor who is a registered user to  
            remove content or information that the minor has posted, or to  
            request that operator remove or anonymize the information.   
            Specifies that the minor be notified of his or her right to  
            request removal and that the notice contain clear instructions  
            on how to do so.  Provides that an operator would not be  
            required to erase or eliminate information that was stored on  
            or posted by a party other than the minor or if the operator  
            is required by state or federal law to maintain the  
            information.

          9)Defines "posted" for purposes of the above provision to mean  
            content or information that can be accessed by a user in  
            addition to the minor who posted the content or information,  
            whether or not the user is a registered user of the site,  
            service, or application. 

           EXISTING LAW  :

          1)Requires an operator of a commercial Web site or online  
            service that collects personally identifiable information  
            through the Internet about individual consumers residing in  
            California to post a privacy policy, as specified.  (Business  
            & Professions Code Sections 22575-22579.)

          2)Requires a business that collects personal information about a  








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            California consumer and shares that information with a third  
            party for marketing purposes to disclose, upon a consumer's  
            written request, the categories of information that were  
            disclosed to a third party for the third party's direct  
            marketing purposes and the names and addresses of all third  
            parties that received the information.  Alternatively, a  
            business may comply with this requirement by adopting a policy  
            that allows a customer to prevent the disclosure of personal  
            information to a third party for the third party's direct  
            marketing purposes, and the business notifies the customer of  
            his or her right to prevent disclosure under the policy and  
            provides the user with a cost-free means of exercising that  
            right.  (Civil Code Section 1798.83.) 

          3)Requires, under federal law, an operator of an Internet Web  
            site or online service directed to a child that is less than  
            13 years old, or an operator that has actual knowledge that it  
            is collecting personal information from a child that is less  
            than 13 years old, to provide notice of what information is  
            being collected and how that information is being used, and to  
            give the parents of the child the opportunity to refuse to  
            permit the operator's further collection of information from  
            the child.  (15 USC Sections 6501-6506.) 

           COMMENTS  :  Statistics cited by the author confirm what has  
          become common knowledge:  teen use of social networking and  
          other online services, including the now pervasive "mobile  
          apps," has expanded greatly in recent years.  Moreover, the  
          author believes that a minor's lack of maturity might make him  
          or her more susceptible to aggressive marketing and more likely  
          to post personal information online without always thinking  
          about the consequences of doing so.  Marketers are apparently  
          aware that children and teens are avid consumers and susceptible  
          to persuasion.  For example, a Wall Street Journal investigation  
          found that 4,123 "cookies" and other tracking devices were  
          placed on a test computer that was used to visit the top 50  
          websites for children and teens, which was about 30% more than  
          were placed on a test computer that visited sites that targeted  
          a general audience.  (See "On the Web, Children Face Intensive  
          Tracking," Wall Street Journal, September 17, 2010.) 

          The laudable goal of this bill, therefore, is to provide greater  
          protection to minors when they visit Internet Web sites or use  
          online or mobile services.  An existing federal law known as the  
          Children's Online Privacy Protection Act (COPPA) already  








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          provides some, albeit limited, protections to children under  
          thirteen.  For example, under COPPA the operator of a Web site  
          or online service that targets children under thirteen must  
          disclose the kinds of information that it collects and what it  
          does with that information.  COPPA also allows parents to  
          opt-out of collection of the children's personal information.   
          This bill differs from federal law in a number of ways.  To  
          begin with, this bill defines "minor" to include any user under  
          the age of eighteen, whereas COPPA applies to users under the  
          age of thirteen.  Unlike COPPA, this bill would not affect the  
          kinds of information that a Web site, online service, or  
          application could collect, though it would effectively limit the  
          use of such information for some marketing purposes; nor would  
          this bill allow a parent to opt-out of collection on the child's  
          behalf.  Instead, this bill would add two new protections that  
          both complement and go beyond federal protections: 

          First, this measure will give minors the opportunity, subject to  
          certain exceptions, to remove information that they have posted  
          or stored on a Web site, online service, or application.  There  
          is no such opportunity under COPPA.  It should be noted,  
          however, that "removal" will not necessarily mean to literally  
          "remove" by deletion or erasure.  Rather, an operator can comply  
          with a "removal" request by hiding the posting so that no other  
          users can see or access it, or by otherwise making the posting  
          anonymous.  

          Second, the bill would prohibit the operator of the Web site,  
          online service, or application from targeting minors with  
          advertisements for goods and services that they cannot legally  
          purchase.  Of course, the operator of the Web site, service, or  
          application cannot always know the age of the user; therefore,  
          this bill would only apply to operators of Web sites, services,  
          or applications that are "directed to minors," or to operators  
          that have actual knowledge that a user is a minor, whether or  
          not the site, service, or application specifically targets  
          minors.  In other words, the operator of a service that targets  
          minors must comply with the provisions of this bill even though  
          some of its users may be adults; conversely, the operator of a  
          service directed to a general audience, but one which minors  
          might still use, would not be required to comply with the law  
          unless the operator had "actual knowledge" that the user was a  
          minor. 

           When is a Web Site "Directed to Minors  ?  One of the points  








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          raised by the bill's opponents, and other concerned parties,  
          concerns the potential vagueness of the term "directed to  
          minors."  As most recently amended, the definitional section of  
          the bill suggests that a site or service is "directed to minors"  
          if it is "created for the purpose of reaching an audience that  
          is predominantly composed of minors, and is not intended for a  
          more general audience comprised of adults."  [Emphasis added.]   
          The definition adds that a site or service would not be deemed  
          to be "directed at minors" merely because it contained links to  
          sites or services that were directed to minors.  

          Few would likely disagree that the Sesame Street Web site  
          (  www.sesamestreet.org  ) is directed to minors, and very young  
          ones at that, since it consists of interactive, educational  
          games for pre-school children.  Under this bill, it seems to  
          safe to say, that this would be a website that is  
          "predominantly" designed for minors, even though adults may  
          visit the site - whether to monitor what it offers to their  
          children or if they secretly enjoy playing "Elmo the Musical  
          Cowboy."  

          But as one moves away from more obvious children's content and  
          up the age scale, it may become more difficult to determine if a  
          site or service is "predominantly" directed to minors or if it  
          is directed to young adults more generally.  For example, a  
          search for "websites for teens" retrieves, among other things, a  
          website called "12 Awesome Websites for Teens."  Among the  
          "awesome" websites is "Teens for Planet Earth," which describes  
          itself as a "social networking site for teenagers who want to  
          get involved in protecting our planet.  They can connect with  
          other green-minded teens, choose a project or create their own  
          and really make a difference."  (  www.teensforplanetearth.org  )   
          This Web site too, given that it appears to be targeted to high  
          school students, would likely be deemed predominantly directed  
          to minors, even though 18 and 19 year-old teens might have an  
          interest in protecting their planet as well.  Other sites and  
          services, however, such as ones that appeal to fans of youthful  
          entertainers or pop musicians, are not as clearly "directed to  
          minors," even though one might reasonably suspect that many if  
          not most of their users are minors.  If that were the case, then  
          presumably under this bill such a site would not be considered a  
          website directed to minors, and the website would only be  
          required to restrict its advertising in accordance with this  
          bill if it had actual knowledge that a user is a minor. 
           








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          Practical Impact of "Actual Knowledge" Component of Bill  :  With  
          the exception of those websites that are indisputably "directed  
          to minors," it is difficult to assess the practical impact of  
          this bill, in part because it will be difficult for a Web site  
          or online service to have "actual knowledge" of a user's age  
          unless the minor has already submitted that information to the  
          operator and the operator knows that the minor, and not someone  
          else in the household, has logged onto the computer.  For  
          example, there is much disagreement about the practical effect  
          of COPPA and the ability of Internet Web sites and online  
          services to police even their own age policies.  For example,  
          Facebook requires that its users be at least thirteen years old  
          - partly, perhaps, to avoid having to comply with COPPA - but it  
          is well-documented that children quickly learn to circumvent  
          this by entering a false birth date; indeed, one study suggests  
          that about 10% of parents freely admit that they helped their  
          children set up those deceptive and unauthorized accounts.  On  
          the other side, just as the user may be dishonest about his or  
          her age, the operator may have an interest in not acquiring  
          actual knowledge of the user's age.  Indeed, the bill expressly  
          states that the operator has no obligation to inquire into the  
          age of the user, and it specifies that an operator will be  
          deemed to be in compliance so long as it "takes reasonable  
          actions in good faith" to avoid marketing prohibited goods, even  
          when the operator has actual knowledge that the user is a minor.  
           However, it is most likely impossible to craft legislation that  
          can entirely eliminate the possibility of circumvention, whether  
          on the part of the user or the operator, and this bill appears  
          to be a good start at this objective. 
           
           ARGUMENTS IN SUPPORT  :  Common Sense Media (CSM) supports this  
          bill because it would "significantly improve the digital and  
          online space for minors in California by outlawing the  
          collection of personal information for the purpose of marketing  
          age-restricted and illegal products.  Additionally, it would add  
          a critical 'eraser button' for kids and teens to more easily  
          remove content or information that they have submitted to  
          websites."  CSM argues that while teen access to digital content  
          has definite advantages, it also creates "inherent privacy  
          risks" when personal information is indiscriminately posted or  
          stored.  CSM notes that this danger is especially an issue for  
          minors, not only because of their lack of maturity, but also  
          because research suggests that advertisers track minors to a  
          much greater extent than they track adults.  CSM concludes that  
          this bill will be "a crucial step forward in ensuring that the  








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          online privacy rights of California minors are respected, and  
          that our young people are protected from inappropriate  
          advertising online and on mobile phones."   

          The California Partnership to End Domestic Violence (CPEDV) also  
          supports this bill as a necessary tool for protecting minors  
          from advertising for inappropriate products, but it also  
          suggests that the ability to erase potentially harmful or  
          embarrassing content may help to reduce incidents of the teen  
          dating violence and harassment that "often intersects with the  
          digital world . . . Technology is often used as a tool of abuse,  
          particularly for teens.  This can include malicious posts on  
          social media or posting private or embarrassing photos or  
          information.  SB 568 provides another tool teens can use to  
          protect their privacy." 

           ARGUMENTS IN OPPOSITION  :  The Center for Democracy and  
          Technology (CDT) opposes this bill because of "its potential  
          burden on minors' own First Amendment rights."  CDT believes  
          that the bill's application to websites and services that are  
          "directed to minors" is unconstitutionally vague, and as such it  
          will ultimately lead operators to restrict many marketing and  
          advertising materials to both minors and young adults, even  
          young adults who are not minors.  CDT believes that "when faced  
          with the obligations to treat minors differently . . . many  
          operators [who are] unsure of their status under this bill will  
          opt to bar minors from their sites and services altogether."   
          CDT believes that, whether intended to or not, this bill will  
          "restrict minors' access to constitutionally protected material,  
          limit their opportunities for speech, and discourage development  
          of content designed for younger audiences."  CDT contends - and  
          cites case law in support of this contention - that minors have  
          as much right to receive constitutionally protected material as  
          do adults, "and only in relatively narrow and well-defined  
          circumstances may government bar public dissemination of  
          protected materials to them."  (Quoting Erznoznik v.  
          Jacksonville (1975) 422 U.S. 205, 212-213.) 

          In addition to these constitutional concerns, CDT also opposes  
                this bill because of practical problems of implementation and  
          unintended consequences.  For example, CDT contends that this  
          bill will only encourage minors to lie about their age when  
          logging into or signing up for online services, which in turn  
          will circumvent "efforts by operators to tailor content controls  
          for different age groups."  CDT also points out that federal  








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          COPPA law applies to children under the age of 13, not all  
          minors under 18.  CDT believes that this difference is critical,  
          claiming that COPPA "works, to the extent that it does, because  
          it is relatively easy to identify content intended for young  
          children," as opposed to content designed for a general audience  
          that includes young adults and older minors.  While the  
          language, themes, and images associated with children's material  
          is readily recognized as such, CDT contends that it is much more  
          difficult to draw a line between the interests of a 16 to17 year  
          old and a young adult.  

           Recent Amendments Address Some But Probably Not all Opposition  
          Concerns  :  Some, but certainly not all, of CDT's opposition  
          might be addressed by recent amendments.  For example, recent  
          amendments to the definition of a service "directed to minors"  
          clarify that the bill's requirements will only apply to a Web  
          site that is directed "predominantly" to minors, and the bill  
          now expressly exempts Web sites and services designed "for a  
          more general audience comprised of adults."  Similarly, CDT's  
          concern that operators will be forced to seek more information  
          to verify a user's age is potentially addressed by an amendment  
          that expressly states that nothing in the bill shall be  
          construed to require an operator to collect age information  
          about users.  Finally, one of CDT's principle objections appears  
          to be that this bill should follow COPPA in defining a "minor"  
          as a person under the age of thirteen.  However, the author is  
          primarily concerned with the teens that most frequently use the  
          Internet and social media services, and studies suggest that  
          they are between the ages of thirteen and seventeen.  

           PROPSOSED AUTHOR AMENDMENTS  :  The author wishes to take the  
          following clarifying and substantive amendments in this  
          Committee to address concerns raised by various stakeholders  
          who, while not opposed to the bill per se, but have raised  
          concerns.  With these amendments, all opposition has apparently  
          been removed except that of the Center for Democracy  
          &Technology.

          - On page 2, line 14, strike out the second "application," and  
            on page 3, line 3, strike out "shall" and insert:  application:  
            (1) Shall  

          - On page 3 between lines 12 and 13 insert:   (2) Shall be deemed  
            in compliance with paragraph (1) if the operator takes  
            reasonable actions in good faith designed to avoid marketing  








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            or advertising under circumstances prohibited under paragraph  
            (1).  

          - On page 3, line 28, strike out "if the marketing or  
            advertising is" and insert:  to that minor  

          - On page 6, line 17, strike out "created" and insert:  
             distributed by or at the direction of the operator  

          - On page 6, line 18, after "in" insert:  subdivision  

          - On page 6 between lines 18 and 19, insert:  (k) "Marketing or  
            advertising" means, in exchange for monetary compensation, to  
            make a communication to one or more individuals, or to arrange  
            for the dissemination to the public of a communication, about  
            a product or service the primary purpose of which is to  
            encourage recipients of the communication to purchase or use  
            the product or service.  

          -  On page 7, line 15, after "was" insert:   stored on or  

          - On page 7, line 19, after "was" insert:  stored,  

          - On page 7, line 19, after "republished" insert a comma





           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          California Partnership to End Domestic Violence 
          Children Now 
          Common Sense Media
           
            Opposition 
           
          Center for Democracy & Technology 

           Analysis Prepared by  :  Thomas Clark / JUD. / (916) 319-2334 











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