BILL ANALYSIS                                                                                                                                                                                                    Ó






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          |SENATE RULES COMMITTEE            |                       AB 1116|
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                                   THIRD READING 


          Bill No:  AB 1116
          Author:   Committee on Privacy and Consumer Protection, et al. 
          AmendedAmended:9/3/15 in Senate
          Vote:     21  

           SENATE JUDICIARY COMMITTEE:  7-0, 7/14/15
           AYES:  Jackson, Moorlach, Anderson, Hertzberg, Leno, Monning,  
            Wieckowski

           SENATE APPROPRIATIONS COMMITTEE:  Senate Rule 28.8

           ASSEMBLY FLOOR:  74-0, 5/22/15 (Consent) - See last page for  
            vote

           SUBJECT:   Connected televisions


          SOURCE:    Author

          DIGEST:   This bill prohibits the operation of a voice  
          recognition feature within a connected television without first  
          prominently informing, during the initial setup or installation  
          of a connected television, either the user or the person  
          designated by the user to perform the initial setup or  
          installation of the connected television.  This bill also  
          prohibits for advertising purposes the use or sale of certain  
          recordings that are collected by a connected television for the  
          purpose of improving its voice recognition feature.

          Senate Floor Amendments of 9/3/15 limit the scope of the  
          prohibition against using sound recordings collected by a  
          connected television for advertising purposes to only those  
          recordings collected for the purpose of improving the connected  








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          television's voice recognition feature.

          ANALYSIS: 

          Existing law:

          1)Provides, in the California Constitution, that all people are  
            by nature free and independent and have inalienable rights.   
            Among these are enjoying and defending life and liberty,  
            acquiring, possessing, and protecting property, and pursuing  
            and obtaining safety, happiness, and privacy.  (Cal. Const,  
            art. I, Sec. 1.)

          2)Permits a person to bring an action in tort for an invasion of  
            privacy and provides that in order to state a claim for  
            violation of the constitutional right to privacy, a plaintiff  
            must establish the following three elements: (1) a legally  
            protected privacy interest; (2) a reasonable expectation of  
            privacy in the circumstances; and (3) conduct by the defendant  
            that constitutes a serious invasion of privacy.  (Hill v.  
            National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 40.)

          3)States that legally recognized privacy interests are generally  
            of two classes: interests in precluding the dissemination or  
            misuse of sensitive and confidential information  
            (informational privacy), and interests in making intimate  
            personal decisions or conducting personal activities without  
            observation, intrusion, or interference (autonomy privacy).   
            (Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th  
            1, 35.)

          4)Renders an individual liable for constructive invasion of  
            privacy when that individual attempts to capture, in a manner  
            that is offensive to a reasonable person, any type of visual  
            image, sound recording, or other physical impression of  
            another engaging in a private, personal, or familial activity,  
            through the use of any device, regardless of whether there is  
            a physical trespass, if this image, sound recording, or other  
            physical impression could not have been achieved without a  
            trespass unless the device was used.  (Civ. Code Sec. 1708.8.)

          5)States that no person who owns, controls, operates, or manages  
            a satellite or cable television corporation, or who leases  
            channels on a satellite or cable system shall use any  







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            electronic device to record, transmit, or observe any events  
            or listen to, record, or monitor any conversations that take  
            place inside a subscriber's residence, workplace, or place of  
            business, without obtaining the express written consent of the  
            subscriber, as specified.  (Pen. Code Sec. 637.5(a)(1).)

          6)States that no satellite or cable television corporation may  
            provide any person with any individually identifiable  
            information regarding any of its subscribers, including, but  
            not limited to, the subscriber's television viewing habits,  
            shopping choices, interests, opinions, energy uses, medical  
            information, banking data or information, or any other  
            personal or private information, without the subscriber's  
            express written consent.  (Pen. Code Sec. 637.5(a)(2).)

          7)Specifies that individual subscriber viewing responses or  
            other individually identifiable information derived from  
            subscribers may be retained and used by a satellite or cable  
            television corporation only to the extent reasonably necessary  
            for billing purposes and internal business practices, and to  
            monitor for unauthorized reception of services, as specified.   
            (Pen. Code Sec. 637.5(b).)

          8)Specifies that any individually identifiable subscriber  
            information gathered by a satellite or cable television  
            corporation shall be made available for subscriber examination  
            within 30 days of receiving a request by a subscriber to  
            examine the information on the premises of the corporation.   
            (Pen. Code Sec. 637.5(d).)



          This bill:


          1)States that a person or entity shall not provide the operation  
            of a voice recognition feature within this state without  
            prominently informing, during the initial setup or  
            installation of a connected television, either the user or the  
            person designated by the user to perform the initial setup or  
            installation of the connected television.

          2)States that any actual recordings of spoken word collected  
            through the operation of a voice recognition feature by the  







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            manufacturer of a connected television or a third party for  
            the purpose of improving the voice recognition feature,  
            including, but not limited to, the operation of an accessible  
            user interface for people with disabilities, shall not be sold  
            or used for any advertising purpose.

          3)Specifies that a manufacturer shall only be liable for  
            functionality provided at the time of the original sale of a  
            connected television and shall not be liable for functionality  
            provided by applications that the user chooses to use in the  
            cloud or are downloaded and installed by a user.

          4)Does not apply to satellite or cable television corporations  
            regulated under Section 637.5 of the Penal Code.

          5)Provides that enforcement of the above provisions may be  
            prosecuted exclusively in a court of competent jurisdiction in  
            a civil action brought in the name of the people of the State  
            of California by the Attorney General or by any district  
            attorney, and that this bill shall not be deemed to create a  
            private right of action, or limit any existing private right  
            of action.  This bill specifies that actions for relief may  
            include enjoining a person who engages, has engaged, or  
            proposes to engage, in a violation of the above provisions,  
            and assessing a civil penalty against the person not to exceed  
            two thousand five hundred dollars ($2,500) for each connected  
            television sold or leased in violation of this chapter.

          6)Defines, among others, the following terms:

           "connected television" means a video device designed for home  
            use to receive television signals and reproduce them on an  
            integrated, physical screen display that exceeds 12 inches,  
            but does not include a personal computer, portable device, or  
            a separate device that connects physically or wirelessly to a  
            television, including, but not limited to, a set-top box,  
            video game console, or digital video recorder; and

           "voice recognition feature" means the function of a connected  
            television that allows the collection, recording, storage,  
            analysis, transmission, interpretation, or other use of spoken  
            words or other sounds, except that this term shall not include  
            voice commands that are not recorded or transmitted beyond the  
            connected television.







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          Background


          Late last year, an electronics manufacturer named Samsung  
          unveiled a new consumer television set featuring voice  
          recognition technology that enables the user to operate the  
          television, access imbedded applications, and navigate the  
          Internet, using voice commands.  Shortly after its introduction,  
          consumer groups expressed concern that the television's voice  
          recognition technology was recording sounds within range of the  
          television and transmitting the recordings across the Internet  
          to third parties for unknown purposes.  An article earlier this  
          spring from the British Broadcasting Company describes the  
          problem as follows:

               Samsung is warning customers about discussing personal  
               information in front of their smart television set.  The  
               warning applies to TV viewers who control their Samsung  
               Smart TV using its voice activation feature.  When the  
               feature is active, such TV sets "listen" to what is said  
               and may share what they hear with Samsung or third parties,  
               it said.

               Privacy campaigners said the technology smacked of the  
               telescreens, in George Orwell's 1984, which spied on  
               citizens.  The warning came to light via a story in online  
               news magazine the Daily Beast which published an excerpt of  
               a section of Samsung's privacy policy for its net-connected  
               Smart TV sets.  These [TV sets] record what is said when a  
               button on a remote control is pressed.  The policy explains  
               that the TV set will be listening to people in the same  
               room to try to spot when commands or queries are issued via  
               the remote.  It goes on to say: "If your spoken words  
               include personal or other sensitive information, that  
               information will be among the data captured and transmitted  
               to a third party."

               Corynne McSherry, an intellectual property lawyer for the  
               Electronic Frontier Foundation which campaigns on digital  
               rights issues, told the Daily Beast that the third party  
               was probably the company providing speech-to-text  







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               conversion for Samsung.  She added: "If I were the  
               customer, I might like to know who that third party was,  
               and I'd definitely like to know whether my words were being  
               transmitted in a secure form."
               . . .
               In response to the widespread sharing of its policy  
               statement, Samsung has issued a statement to clarify how  
               voice activation works.  It emphasised that the voice  
               recognition feature is activated using the TV's remote  
               control.  It said the privacy policy was an attempt to be  
               transparent with owners in order to help them make informed  
               choices about whether to use some features on its Smart TV  
               sets, adding that it took consumer privacy "very  
               seriously".

               Samsung said: "If a consumer consents and uses the voice  
               recognition feature, voice data is provided to a third  
               party during a requested voice command search.  At that  
               time, the voice data is sent to a server, which searches  
               for the requested content then returns the desired content  
               to the TV."  It added that it did not retain voice data or  
               sell the audio being captured.  Smart-TV owners would  
               always know if voice activation was turned on because a  
               microphone icon would be visible on the screen, it said.   
               (British Broadcasting Corporation, Not in Front of the  
               Telly: Warning Over 'Listening' TV (Feb. 9, 2015)  
                
                                                                    Page  7


          $2,500 against a person for each connected television found to  
          violate these prohibitions.

          Comments

          The author writes:

               AB 1116 prohibits a manufacturer from selling a television  
               in California that can record and transmit sounds or  
               conversations from inside a person's home back to the  
               manufacturer or to a third party when the TV's voice  
               recognition technology is not enabled by the consumer.  The  
               bill specifies that only the Attorney General or a district  
               attorney may enforce its provisions.  The bill does not  
               create a private right of action.  This bill is authored  
               and sponsored by the Assembly Privacy and Consumer  
               Protection Committee.

               Once considered a novelty, voice recognition technology has  
               become a standard capability of many consumer electronics.   
               From telephones that capture and interpret our voices to  
               enable handsfree texting, to televisions that allow users  
               to change channels via voice command, this cutting edge  
               technology has continued to evolve in ways that promote  
               ease of use and safety for consumers.  Critics, however,  
               question the price of this progress.  Much to the dismay  
               and outrage of consumers and civil libertarians in the  
               United States and abroad, recent news reports have exposed  
               that smart TVs with voice recognition features can record  
               and transmit sounds and private conversations inside the  
               room where the TV is located.  While manufacturers have  
               warnings tucked away in their privacy policies and service  
               agreements, consumers have been largely unaware that  
               whatever they say can be captured, recorded and transmitted  
               to the manufacturer or a third party service provider.

               AB 1116 protects California consumers by effectively  
               requiring manufacturers to ensure that a TV's voice  
               recognition feature cannot be remotely enabled by the  
               manufacturer or the manufacturer's third party service  
               provider without a consumer's knowledge.

          Prior Legislation
          







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          AB 2306 (Chau, Chapter 858, Statutes of 2014) expanded the tort  
          of constructive invasion of privacy to include the use of any  
          device to capture, or attempt to capture, in a manner that is  
          offensive to a reasonable person, any type of visual image,  
          sound recording, or other physical impression of another person  
          engaging in a personal or familial activity under circumstances  
          in which the other person had a reasonable expectation of  
          privacy.

          AB 2667 (Bloom, Chapter 426, Statutes of 2014) amended the  
          Karnette Rental-Purchase Act to require a lessor to give clear  
          and prominent notice to a consumer and obtain their express  
          consent when selling an electronic device that has geophysical  
          location tracking technology installed by the lessor.  The bill  
          prohibited lessors from using, selling, or sharing geophysical  
          location tracking technology for any purpose other than the  
          repossession of the electronic device when there is a violation  
          of the rental-purchase agreement, or when requested by the  
          consumer, and also prohibited 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.

          SB 1090 (Bowen, Chapter 731, Statutes of 2001) expanded to  
          satellite television corporations the existing prohibition on  
          using electronic devices to observe, listen to, record, or  
          monitor events or conversations inside a cable television  
          subscriber's residence, workplace, or place of business without  
          the subscriber's written consent, or from providing any other  
          person with individually identifiable information, as specified,  
          regarding any subscriber.

          SB 1599 (Bowen, 2000) would have expanded to video providers, as  
          defined, the existing prohibition on using electronic devices to  
          observe, listen to, record, or monitor events or conversations  
          inside a cable television subscriber's residence, workplace, or  
          place of business without the subscriber's written consent, or  
          from providing any other person with individually identifiable  
          information, as specified, regarding any subscriber.  The bill  
          died in the Assembly Public Safety Committee.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No








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          SUPPORT:   (Verified9/4/15)




          Privacy Rights Clearinghouse




          OPPOSITION:   (Verified9/4/15)


          None received

          ASSEMBLY FLOOR:  74-0, 5/22/15
          AYES:  Achadjian, Travis Allen, Baker, Bigelow, Bloom, Bonilla,  
            Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau,  
            Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly,  
            Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina  
            Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,  
            Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden,  
            Irwin, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,  
            Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,  
            Nazarian, Obernolte, Patterson, Perea, Quirk, Rendon,  
            Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark  
            Stone, Thurmond, Ting, Wagner, Wilk, Williams, Wood, Atkins
          NO VOTE RECORDED:  Alejo, Jones, O'Donnell, Olsen, Waldron,  
            Weber

          Prepared by:Tobias Halvarson / JUD. / (916) 651-4113
          9/4/15 18:27:54


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