BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2015-2016 Regular Session
AB 2609 (Chau)
Version: May 10, 2016
Hearing Date: June 28, 2016
Fiscal: Yes
Urgency: No
TH
SUBJECT
Advertising: Educational Conferences
DESCRIPTION
This bill requires an educational conference organization that
provides materials related to an educational conference directly
to a school or school employee for purposes of distribution to a
student to include specified disclosures with the materials, to
provide those disclosures to the school and school employees,
and to provide the materials directly to the parent or legal
guardian of the student.
BACKGROUND
According to a 2009 New York Times article, an event planning
company called Envision EMI uses teachers and school employees
to generate leads for its educational leadership conferences.
Teachers are asked to identify and nominate high-achieving
students to attend these conferences, and, using that
information, the company sends conference marketing materials
directly to students describing the event as an "honor" or
"prestigious opportunity" without disclosing that the
conferences are not as selective as the company's marketing
suggests. Describing some students' experiences with the
company, the article states:
The offer that arrived in Emily Wharton's mailbox looked and
sounded more like an Academy Award than a sales pitch. In
fancy script, on weighty card stock adorned by a giant gold
seal, the letter congratulated Ms. Wharton for the honor of
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being nominated to attend the National Young Leaders
Conference in Washington, D.C. It counted 366 members of the
United States Congress on its honorary Congressional board of
advisers. It told her that she would represent the state of
New York and promised a "lifetime advantage" and "valuable
addition" to her résumé. It used words like "elite,"
"distinguished," "select."
. . .
The company that organized the conference, a direct-mail
powerhouse called the Congressional Youth Leadership Council,
runs an alphabet soup of such conferences that it says are
attended by 50,000 students a year. It solicits
recommendations from teachers and alumni of previous
conferences, and it culls names from mailing lists, for which
the council paid $263,000 in 2006 alone, according to its last
filing with the Internal Revenue Service, before it gave up
its nonprofit status.
Philippa Wharton has saved all the solicitations, she says,
"because they irritate me." "I like to build my kids up, but
on real accomplishments," she says. "It's just too much.
Instead of coming right out and saying, 'We organize these
wonderful trips to Washington, and you can meet all these
other kids who are interested in government and motivated,'
they play up the honor angle. It's like a marketing scam."
. . .
"You're told it's very selective, it wasn't at all," says
Rasheed Hamdan, a graduate of American Military University.
He flew in from Baja California Sur, Mexico, for the
conference, the first he had ever attended. He had special
business cards printed up and bought a tuxedo for an
advertised black-tie gala, which turned out not to be formal
or an official ball but, he says, a "glorified prom night."
(Diana Jean Schemo, Congratulations! You Are Nominated. It's
an Honor. (It's a Sales Pitch.), New York Times (April 13,
2009) [as of June 18, 2016].)
Envision EMI is not the only company that organizes and markets
educational leadership conferences. According to the same Times
article, "[t]he array of similarly named, competing companies
underscores the extent to which the concept of student
leadership has become big business."
There's the National Student Leadership Conference, which
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offers a "select group of outstanding high school students" a
taste of fields like medicine, engineering and business
through field trips and simulations, and a chance to earn
credit from American University (P.S.: the course comes for an
extra fee - $620 for one credit hour or $1,650 for three, on
top of a program fee of $1,600 to $3,000). There's
LeadAmerica's Congressional Student Leadership Conference,
which also advertises credit (P.S.: it's pass/fail, from Loras
College in Dubuque, Iowa, and most universities will not
accept it). People to People Ambassador Programs, which
boasts of ties to Dwight D. Eisenhower, has had to apologize
for sending invitations to its leadership programs to deceased
children and an Arkansas family's long-dead one-eyed cat. And
Leadership Classroom takes teenagers to the Caribbean each
summer for "experiential learning" in sailing and scuba
diving. (Id.)
This bill responds to the marketing practices that occur with
respect to these leadership conferences. It requires, among
other things, that organizations operating these conferences
disclose in their marketing materials that the award,
invitation, or nomination to participate in the conference
constitutes a solicitation for the sale of a product, the
specific eligibility criteria required for participation in the
solicited educational conference, if any, and that attendance at
an educational conference may not affect a student's chances of
being admitted to college.
CHANGES TO EXISTING LAW
Existing law , the Unfair Competition Law, renders an individual
liable for any unlawful, unfair or fraudulent business act or
practice and any unfair, deceptive, untrue or misleading
advertising. (Bus. Prof. Code Sec. 17200.)
Existing law provides that one who willfully deceives another
with intent to induce him to alter his position to his injury or
risk, is liable for any damage which he thereby suffers. (Civ.
Code Sec. 1709.)
This bill requires an educational conference organization that
provides materials related to an educational conference directly
to a school or any employee for purposes of distribution to a
student to provide the materials in a sealed envelope or other
packaging addressed to the parent or legal guardian of the
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student.
This bill requires an educational conference organization to
include with such materials, and to provide to specified school
employees, all of the following disclosures, in clear and
conspicuous language:
that the materials constitute a solicitation for the sale of a
product;
the legal form of the organization making the solicitation,
including the for-profit status of the organization;
the legal owner, if any, of the organization making the
solicitation;
the specific eligibility criteria required for participation
in the solicited educational conference or conferences, if
any;
an itemized list of the costs to participate in the
educational conference and the total price of participating in
the educational conference, including estimated expenses not
included in the price of the educational conference;
that attendance at an educational conference may not affect a
student's chances of being admitted to college and that a
parent or guardian should contact the student's school
counselor for more information;
whether or not a nomination from a teacher or school
administrator is required to participate in the educational
conference, or if an individual may be self-nominated or
nominated by a parent or guardian;
the total amount, if any, of funding or other support,
including employment or grants for school supplies, the
organization has provided to the student's school or the
school's employees during the last three years before the date
of the solicitation; and
a phone number, email address, or Internet Web site that a
parent or guardian may use to contact a government agency
within the relevant jurisdiction for purposes of filing a
complaint related to the solicitation or the educational
conference itself.
This bill defines an "educational conference" to mean a
conference, forum, camp, or other similar event, intended to
develop the leadership, career, or college readiness of a
student or provide some other form of educational benefit, when
participation in the event is represented as being limited to
students receiving an award, invitation, or nomination to
participate in the event.
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This bill makes related findings and declarations.
COMMENT
1.Stated need for the bill
The author writes:
Currently, some for-profit event planning companies are
delivering their marketing materials for expensive conferences
directly through schools to K-12 students without their
parents' consent. By their own description, these
solicitations may appear to be an exclusive nomination to
attend a prestigious youth leadership conference, when in fact
they are simply a sales pitch for a conference that can cost
hundreds or even thousands of dollars. These solicitations
are addressed directly to the student rather than to the
parent, and are delivered by a trusted source; the student's
teacher.
These companies identify potential leads by asking teachers to
"nominate" students, although the criteria can be vague,
subjective or nonexistent. Once delivered, potentially with
great fanfare at school, "nominated" students may mistakenly
believe that they have won an award or other competitive
honor. However, according to a 2009 New York Times article
about the practice, there are no hard and fast criteria for
nominators, and teachers simply use their own discretion when
identifying potential applicants. In some cases, teachers are
also eligible to request "grants" to pay for classroom
supplies from the same companies seeking student nominees -
although the teachers themselves may not be aware that the
nomination process is simply a means to generate a sale.
While these camps may provide a worthwhile enrichment
experience for some children who participate, the misleading
and manipulative nature of a solicitation that appears to be
an honor, and the fact that the pitch is directly and publicly
aimed at the student and communicated through a teacher,
raises serious questions of student privacy and consumer
protection. Young students are particularly vulnerable to
manipulative solicitations that appear to be a competitive
award or honor because of their perceived value in applying
for college, because a respected teacher delivered the
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materials, or perhaps because the "nomination" was announced
publicly before the student's peers.
Current law is not adequate to protect kids from these
solicitations. California's Student Online Personal
Information Act (SOPIPA) only restricts targeted advertising
by operators of websites designed and marketed for K-12
purposes. Similarly, the Federal Educational Rights and
Privacy Act (FERPA) broadly protects the privacy of student
education records, but does not apply to "directory
information," which can include the student's name. AB 2609
protects school-aged children from solicitations from
for-profit organizations that sell educational conferences by
requiring these companies to address and deliver all marketing
materials directly to the parents instead of the student.
Additionally, this bill requires the materials to include a
disclosure, also given to the school and school employees,
that plainly states that it is a solicitation, and specifies
the criteria required for participation, if any.
2.Protecting consumers from unfair business practices
The Legislature has long considered consumer protection to be a
matter of high importance. State law is replete with statutes
aimed at protecting California consumers from unfair, dishonest,
or harmful market practices. The Unfair Competition Law (UCL),
as an example, renders an individual liable for any unlawful,
unfair or fraudulent business act or practice and any unfair,
deceptive, untrue or misleading advertising. (Bus. Prof. Code
Sec. 17200.) In describing the unfair competition law's broad
scope, the Supreme Court explained "it does not proscribe
specific practices. Rather . . . it defines unfair competition
to include any unlawful, unfair or fraudulent business act or
practice. Its coverage is sweeping, embracing anything that can
properly be called a business practice and that at the same time
is forbidden by law." (Cel-Tech Communications, Inc. v. Los
Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 180
(internal quotation marks and citations omitted).)
This bill would compliment California's existing consumer
protection statutes by requiring educational conference
organizations to make specified disclosures about the conference
products they market to students. As discussed in the
Background, marketing practices in this industry appear not to
clearly disclose that attendance at such conferences may not
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affect a student's chances of being admitted to college, and
that an award, invitation, or nomination to participate in a
conference actually constitutes solicitation for the sale of a
product. Imposing mandatory disclosures and re-directing
delivery of solicitation materials to a student's parent or
guardian will likely better educate students, parents, and
guardians as to the nature of these offers. Additionally,
should an educational conference organization fail to make
required disclosures, California's consumer protections statutes
-- like the UCL -- provide strong remedies to parties harmed as
a result, either individually or on a class-wide basis.
Support : California Teachers Association; Common Sense Kids
Action
Opposition : None Known
HISTORY
Source : Author
Related Pending Legislation : None Known
Prior Legislation : SB 142 (Boatwright, Ch. 772, Stats. 1995)
required educational travel organizations that arrange
educational travel programs to enter into a contract with an
educational institution containing a specified itemized
statement of services prior to arranging an educational travel
program. SB 142 imposed certain practice requirements on
educational travel organizations and made violations of these
provisions subject to civil and criminal remedies.
Prior Vote :
Senate Business, Professions and Economic Development Committee
(Ayes 9, Noes 0)
Assembly Floor (Ayes 67, Noes 0)
Assembly Appropriations Committee (Ayes 20, Noes 0)
Assembly Education Committee (Ayes 7, Noes 0)
Assembly Privacy and Consumer Protection Committee (Ayes 9, Noes
0)
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