BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  SB 467
                                                                  Page  1

          Date of Hearing:  June 11, 2013
          Counsel:       Stella Choe


                         ASSEMBLY COMMITTEE ON PUBLIC SAFETY
                                 Tom Ammiano, Chair

                      SB 467 (Leno) - As Amended:  April 1, 2013
           
           
           SUMMARY  :  Requires a search warrant when a governmental agency  
          is seeking to obtain the contents of a wire or electronic  
          communication that is stored, held or maintained by a provider  
          of electronic communication services or remote computing  
          services.  Specifically,  this bill  :

          1)Defines a "governmental entity" as a department or agency of  
            California or any political subdivision thereof, or an  
            individual acting for or on behalf of California or any  
            political subdivision thereof.

          2)States, within three days after a governmental entity receives  
            those contents from a service provider, the governmental  
            entity shall serve upon, or deliver by registered or  
            first-class mail, electronic mail, or other means reasonably  
            calculated to be effective as specified by the court issuing  
            the warrant, to the subscriber, customer, or user a copy of  
            the warrant and a notice that includes the required  
            information, except that delayed notice may be given as  
            specified.

          3)Allows a governmental entity, when a search warrant is sought,  
            to include in the application a request, supported by sworn  
            affidavit, for an order delaying the warrant notification  
            required under existing provisions of law.

          4)Requires the court to grant the request if the court  
            determines that there is reason to believe that notification  
            of the existence of the warrant may have an adverse result as  
            defined, but only for the period of time that the court finds  
            there is reason to believe that the warrant notification may  
            have that adverse result, and in no event shall the period of  
            time for the delay exceed 90 days.

          5)Authorizes the court to grant extensions of the delay of the  








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            warrant notification of up to 90 days each on the same  
            grounds.

          6)Requires the governmental entity, upon expiration of the  
            period of delay of the warrant notification, to serve upon, or  
            deliver by registered or first-class mail, electronic mail, or  
            other means reasonably calculated to be effective as specified  
            by the court issuing the warrant, the customer, user, or  
            subscriber a copy of the warrant together with a notice that  
            does both of the following:

             a)   States with reasonable specificity the nature of the  
               governmental inquiry; and,

             b)   Informs the customer, user, or subscriber all of the  
               following:

               i)     That information maintained for the customer or  
                 subscriber by the service provider named in the process  
                 or request was supplied to, or requested by, that  
                 governmental entity and the date on which the supplying  
                 or request took place;

               ii)    That warrant notification to the customer or  
                 subscriber was delayed;

               iii)   The grounds for the court's determination to grant  
                 the delay; and,

               iv)    Which provisions of this bill authorized the delay.

          7)Removes the requirement that to be subject to these warrant  
            procedures the corporation must provide services to the  
            general public.

          8)States, except as provided, a person or entity providing an  
            electronic communication service or remote computing service  
            shall not knowingly divulge to any person or entity the  
            contents of a wire or electronic communication that is stored,  
            held, or maintained by that service.

          9)Specifies that a service provider may divulge the contents of  
            a communication under any of the following circumstances:

             a)   To an addressee or intended recipient of the  








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               communication or an agent of the addressee or intended  
               recipient;

             b)   As otherwise authorized in Section 1524.2 of the Penal  
               Code;
             
             c)   With the lawful consent of the originator, an addressee,  
               or intended recipient of the communication, or the  
               subscriber in the case of remote computing service;

             d)   To a person employed or authorized or whose facilities  
               are used to forward the communication to its destination;

             e)   As may be necessary incident to the rendition of the  
               service or to the protection of the rights or property of  
               the provider of that service;

             f)   To a law enforcement agency if the contents were  
               inadvertently obtained by the service provider and appear  
               to pertain to the commission of a crime; or,

             g)   To a governmental entity, if the provider, in good  
               faith, believes that an emergency involving the danger of  
               death or serious physical injury to any person requires  
               disclosure without delay of communications relating to the  
               emergency.

          10)States, except as provided, any provider of electronic  
            communication service or remote computing service, subscriber,  
            or other person aggrieved by any knowing or intentional  
            violation of this chapter may, in a civil action, recover from  
            the person, entity, or governmental entity that committed the  
            violation, relief as may be appropriate.

          11)Provides in a civil action under this section, appropriate  
            relief includes, but is not limited to, all of the following:

             a)   Preliminary and other equitable or declaratory relief;

             b)   Damages as specified; and,

             c)   Reasonable attorney's fees and other litigation costs  
               reasonably incurred.

          12)Specifies that the court may assess as damages, in a civil  








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            action, the sum of the actual damages suffered by the  
            plaintiff and any profits made by the violator as a result of  
            the violation, but in no case shall a person be entitled to  
            recover less than the sum of $1,000.  

          13)Authorizes the court to assess punitive damages if the  
            violation is willful or intentional.

           EXISTING LAW  : 

          1)Provides that the right of the people to be secure in their  
            persons, houses, papers, and effects, against unreasonable  
            searches and seizures, shall not be violated, and no warrants  
            shall issue, but upon probable cause, supported by Oath or  
            affirmation, and particularly describing the place to be  
            searched and the persons or things to be seized.  (U.S.  
            Const., 4th Amend.; Cal. Const., art. I, � 13.)

          2)States that a search warrant is an order in writing, in the  
            name of the people, signed by a magistrate, directed to a  
            peace officer, commanding him or her to search for a person or  
            persons, a thing or things, or personal property, and, in the  
            case of a thing or things or personal property, bring the same  
            before the magistrate.  (Penal Code Section 1523.)

          3)Provides that a search warrant cannot be issued but upon  
            probable cause, supported by affidavit, naming or describing  
            the person to be searched or searched for, and particularly  
            describing the property, thing, or things and the place to be  
            searched.  (Penal Code Section 1525.)

          4)Provides that a search warrant may be issued upon any of the  
            specified grounds, including when a provider of electronic  
            communication service or remote computing service has records  
            or evidence, as specified, showing that property was stolen or  
            embezzled constituting a misdemeanor, or that property or  
            things are in the possession of any person with the intent to  
            use them as a means of committing a misdemeanor public  
            offense, or in the possession of another to whom he or she may  
            have delivered them for the purpose of concealing them or  
            preventing their discovery.  [Penal Code Section 1524(a).]

          5)Requires a provider of electronic communication service or  
            remote computing service to disclose to a governmental  
            prosecuting or investigating agency the name, address, local  








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            and long distance telephone toll billing records, telephone  
            number or other subscriber number or identity, and length of  
            service of a subscriber to or customer of that service, and  
            the types of services the subscriber or customer utilized,  
            when the governmental entity is granted a search warrant.   
            [Penal Code Section 1524.3(a).]

          6)States that a governmental entity receiving subscriber records  
            or information is not required to provide notice to a  
            subscriber or customer of the warrant. [Penal Code Section  
            1524.3(b).]

          7)Authorizes a court issuing a search warrant, on a motion made  
            promptly by the service provider, to quash or modify the  
            warrant if the information or records requested are unusually  
            voluminous in nature or compliance with the warrant otherwise  
            would cause an undue burden on the provider.  [Penal Code  
            Section 1524.3(c).]

          8)Requires a provider of wire or electronic communication  
            services or a remote computing service, upon the request of a  
            peace officer, to take all necessary steps to preserve records  
            and other evidence in its possession pending the issuance of a  
            search warrant or a request in writing and an affidavit  
            declaring an intent to file a warrant to the provider.   
            Records shall be retained for a period of 90 days, which shall  
            be extended for an additional 90-day period upon a renewed  
            request by the peace officer.  [Penal Code Section 1524.3(d).]

          9)Specifies that no cause of action shall be brought against any  
            provider, its officers, employees, or agents for providing  
            information, facilities, or assistance in good faith  
            compliance with a search warrant.  [Penal Code Section  
            1524.3(e).]

          10)Provides for a process for a search warrant for records that  
            are in the actual or constructive possession of a foreign  
            corporation that provides electronic communication services or  
            remote computing services to the general public, where the  
            records would reveal the identity of the customers using those  
            services, data stored by, or on behalf of, the customer, the  
            customer's usage of those services, the recipient or  
            destination of communications sent or from those customers, or  
            the content of those communications. (Penal Code Section  
            1524.2.)








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           EXISTING FEDERAL LAW  authorizes a governmental entity to require  
          the disclosure by the provider of the contents of electronic  
          communications in electronic storage for 180 days or less only  
          pursuant to a warrant under the Federal Rules or under an  
          equivalent state warrant.  If the contents of a wire or  
          electronic communication that has been in electronic storage in  
          an electronic communications system for more than 180 days, a  
          governmental entity may require its disclosure through other  
          means such as a subpoena or a court order.  The federal law also  
          includes notification procedures.  (18 USCS Section 2701 et  
          seq.)  

          FISCAL EFFECT  :   Unknown

           COMMENTS  :   

           1)Author's Statement  :  According to the author, "SB 467 updates  
            California's electronic privacy law into the modern age,  
            ensuring emails and other electronic communications content  
            are protected from warrantless government intrusion when  
            stored online and in the cloud.

          "Under SB 467, no government entity shall obtain the contents of  
            an electronic communication without a warrant issued by an  
            officer of the court, regardless of how long it has been in  
            electronic storage or whether it has been opened or unopened. 

          "Law enforcement's ability to investigate and solve crimes with  
            the aid of electronic communications will not be harmed by SB  
            467.  First, the federal Department of Justice recently  
            announced for the first time that it supports a requirement  
            that law enforcement obtain a search warrant before accessing  
            the contents of electronic communications from a service  
            provider.

          "Second, SB 467 codifies the practices of some of the biggest  
            technology companies in California, including Google,  
            Facebook, Microsoft and Yahoo!, all of whom require a search  
            warrant before disclosing the contents of electronic  
            communications. 

          "Third, SB 467 allows police to obtain the contents of  
            electronic communications without a warrant if they have the  
            consent of the user, or an emergency involving the risk of  








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            death or serious injury requires immediate disclosure of  
            electronic communications without a search warrant."

           2)Fourth Amendment Protections  :  The Fourth Amendment of the  
            United States Constitution provides that "the right of the  
            people to be secure in their persons, houses, papers and  
            effects, against unreasonable searches and seizures, shall not  
            be violated, and no Warrants shall issue, but upon probable  
            cause, supported by Oath of Affirmation, and particularly  
            describing the place to be searched, and the persons or things  
            to be seized."  Section 13, Article I of the California  
            Constitution mirrors the Fourth Amendment of the United States  
            Constitution.

          The Fourth Amendment is implicated when "a person has exhibited  
            an actual (subjective) expectation of privacy, and the  
            expectation must be one that society is prepared to recognize  
            as 'reasonable'."  [Katz v. United States (1967) 389 U.S. 347,  
            361.]  When there is no "reasonable expectation of privacy",  
            then government officials are not constrained by the Fourth  
            Amendment's warrant requirement.  However, if there is a  
            "reasonable expectation of privacy", a warrantless search of  
            "persons, houses, papers, and effects" is "per se  
            unreasonable" unless it falls "within some established  
            exception to the warrant requirement."  [U.S. v. Chadwick  
            (1977) 433 U.S.1, 6.]

          In United States v. Warshak (6th Cir. 2010) 631 F.3d 266, the  
            court found that "[g]iven the fundamental similarities between  
            email and traditional forms of communication, it would defy  
            common sense to afford emails lesser Fourth Amendment  
            protection.  (Citations omitted.)  Email is the technological  
            scion of tangible mail, and it plays an indispensable part in  
            the Information Age.  Over the last decade, email has become  
            'so pervasive that some persons may consider [it] to be [an]  
            essential means or necessary instrument for self-expression,  
            even self-identification.'  [Citing City of Ontario v. Quon  
            (2010) 130 S. Ct. 2619, 2630.]  It follows that email requires  
            strong protection under the Fourth Amendment; otherwise, the  
            Fourth Amendment would prove an ineffective guardian of  
            private communication, an essential purpose it has long been  
            recognized to serve."  (United States v. Warshak, supra, 631  
            F.3d at pp. 285-286.)

          This bill addresses these privacy concerns by requiring a valid  








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            search warrant in order to obtain the content of electronic  
            communications, which is currently only required if they have  
            been stored, held or maintained by a provider of electronic  
            communication services or remote computing services for 180  
            days or less. [18 USCS Section 2703(a).]

           3)Current Privacy Practices of Electronic Communication Services  
            Providers  :  Some of the biggest technology companies in  
            California already require a search warrant before disclosing  
            the contents of electronic communications.  According to a  
            recent article, "Google, Microsoft, Yahoo, and Facebook all  
            say that they require full warrants in order to provide the  
            contents of emails and messages to government entities . . .  
            That's a higher standard than currently required by US law,  
            which as of now is largely defined by the Electronic  
            Communications Privacy Act (ECPA).  The ECPA was passed in  
            1986 and sets a relatively low bar for accessing private  
            data."  These companies reported that they all have their own  
            "policies that require a warrant before providing the content  
            of messages" and that the "fourth amendment backs them up."   
            [Bohn, "Google, Microsoft, Yahoo, and Facebook say they  
            require warrants to give over private content," The Verge  
            (Jan. 26, 2013).]

          During a hearing held by the House Judiciary Subcommittee on  
            Crime, Terrorism, Homeland Security and Investigations,  
            Richard Salgado, the Director for Law Enforcement and  
            Information Security at Google provided the following  
            testimony regarding the need to update the ECPA:

          "ECPA was enacted in 1986 - well before the web as we know it  
            today even existed. The ways in which people use the Internet  
            in 2013 are dramatically different than 25 years ago.

          "In 1986, there was no generally available way to browse the  
            World Wide Web, and commercial email had yet to be offered to  
            the general public.  Only 340,000 Americans subscribed to cell  
            phone service, and not one of them was able to send a text  
            message, surf the web, or download applications.  To the  
            extent that email was used, users had to download messages  
            from a remote server onto their personal computer, holding and  
            storing data was expensive, and storage devices were limited  
            by technology and size.

          "In 2013, hundreds of millions of Americans use the web every  








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            day - to work, learn, connect with friends and family,  
            entertain themselves, and more.  Data transfer rates are  
            significantly faster than when ECPA became law - making it  
            possible to share richer data, collaborate with many people,  
            and perform more complicated tasks in a fraction of the time.  
            Video sharing sites, video conferencing applications, search  
            engines, and social networks - all the stuff of science  
            fiction in 1986 - are now commonplace.  Many of these services  
            are free.

          "The distinctions that ECPA made in 1986 were foresighted in  
            light of technology at the time.  But in 2013, ECPA frustrates  
            users' reasonable expectations of privacy.  Users expect, as  
            they should, that the documents they store online have the  
            same Fourth Amendment protections as they do when the  
            government wants to enter the home to seize documents stored  
            in a desk drawer.  There is no compelling policy or legal  
            rationale for this dichotomy."  [Testimony of Richard Salgado,  
            Director, Law Enforcement and Information Security, Google  
            Inc., House Judiciary Subcommittee on Crime, Terrorism,  
            Homeland Security and Investigations Hearing on "ECPA Part 1:  
            Lawful Access to Stored Content" (March 19, 2013).]  
           
           4)Arguments in Support  :  

             a)   The  California Newspaper Publishers Association  writes,  
               "The threat of law enforcement obtaining information  
               protected by law from third parties presents serious  
               problems for newspaper publishers, editors and working  
               journalists.  California has unique protections that allow  
               publishers, editors and working journalists to do their job  
               and protect sensitive sources and their unpublished notes  
               from being routinely accessed by law enforcement and  
               litigants.

             "This information is protected from subpoena under the  
               California Shield Law (See, Cal. Const. Art. Sec. 2 and  
               Evidence Code Sec.1040) and by the absolute prohibition on  
               the search of newsrooms contained in the Penal Code (See,  
               Sec. 1524 (g)).  These protections against forced  
               disclosure of sensitive information are meaningless if all  
               of the contents of a journalist's electronic communications  
               can be obtained from a third party without a warrant."

             b)   According to the  Electronic Frontier Foundation  , the  








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               sponsor of this bill, "The Electronic Communications  
               Privacy Act ("ECPA"), the federal law that governs access  
               to electronic communications stored by online service  
               providers - and which California's law is modeled after -  
               was enacted in 1986, long before the advent of the World  
               Wide Web as we know it, let alone smartphones and e-mail  
               inboxes with infinite storage capacity.

             "ECPA's age shows most dramatically when examining how it  
               regulates law enforcement access to the contents of  
               electronic communications. Under ECPA, law enforcement can  
               obtain the contents of electronic communications stored  
               online with a service provider for less than 180 days only  
               with a search warrant. But once a message has been stored  
               for more than 180 days, law enforcement can obtain its  
               contents without a search warrant.

             "This 180-day dividing line was born out of the technological  
               realities of 1986, when people didn't have the capacity or  
               need to store years of electronic correspondence online.  
               Online storage was limited and Congress presumed people  
               would download important electronic messages onto their own  
               personal computers. Any message sitting on a server for  
               more than 180 days was considered abandoned. And of course  
               there was no such thing as Gmail, Facebook or Twitter in  
               1986.

             "The opposite is true today. With bigger online storage  
               capacity and the prevalence of smartphones and tablets,  
               people are leaving more of their electronic correspondence  
               online in order to access them on any device wherever they  
               are. But under ECPA the only way to take advantage of this  
               convenience is to surrender your right of privacy.

               "Courts are starting to recognize this tension. In 2010,  
               the Sixth Circuit Court of Appeals ruled in United States  
               v. Warshak that people have a reasonable expectation of  
                                                    privacy in email, meaning that any portion of ECPA that  
               authorizes warrantless access to electronic communications  
               violates the Fourth Amendment.

               "SB 467 codifies these principles and ensures that  
               California's statutory regime stays compliant with the  
               Fourth Amendment. SB 467 protects emails and other  
               electronic communications content from warrantless  








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               government intrusion when stored online and in the cloud,  
               regardless of how long it is stored online or whether it  
               has been opened or unopened."

           5)Arguments in Opposition  :  

             a)   The  California District Attorneys Association  argues,  
               "Federal law applies only to those electronic communication  
               services available to the general public and California law  
               mirrors that limitation.  The proposed amendments to Penal  
               Code Section 1524.2 eliminate this restricted coverage.   
               Thus, the federal statutes do no regulate access to a  
               closed system service such as that provided by a corporate  
               information technology (IT) system or the IT system of a  
               county government.  SB 467 would extend coverage to private  
               systems.  This change will be the first item to cause  
               confusion about how to proceed to legally obtain Intranet  
               contents of communications.

             "The amended section also requires that law enforcement must  
               give notice to the person whose electronic messages are  
               obtained by search warrant within three days of law  
               enforcement receiving the messages.  This is not required  
               at all under the federal law if a search warrant is used  
               (18 USC 2703(b)(1)(A)).  Prior notice to the customer of  
               the service is only required if law enforcement proceeds by  
               way of what is referred to as a 'd' order (from sec.  
               2793(d)).  A 'd' order can be issued on less than probable  
               cause.  (See 18 USC 2703(b)(1)(B) for the notice  
               requirement.)  Thus, this bill will impose a new burden on  
               law enforcement.

             "Proposed new section 1524.6 prohibits a person or entity  
               providing 'electronic communications services' or 'remote  
               computing services' from knowingly divulging the contents  
               of any communications stored, held, or maintained by those  
               services.  The federal statute has the same type of  
               prohibition but applies only to services available to the  
               general public.  They do not govern a closed communication  
               system within a corporation or governmental entity.  SB 467  
               would extend the prohibition to both the public and private  
               systems which will add to the confusion.

             b)   The  Los Angeles County District Attorney's Office   
               writes, "SB 467 would require a governmental entity to  








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               obtain a search warrant whenever the governmental entity is  
               seeking to obtain the contents of a wire communication that  
               is stored, held, or maintained by a service provider, as  
               specified.

             "Governmental entities employ one-fifth of all workers today.  
                Our office believes SB 467 interferes with a governmental  
               employers need to access employees' information systems to  
               ensure that governmental assets are used only for their  
               intended purpose, for official business, and not for  
               personal emails or other illegal and prohibited uses."

           6)Prior Legislation  :  

             a)   SB 1980 (McPherson), Chapter 864, Statutes of 2002,  
               created state procedures, similar to those in federal law,  
               for a governmental entity to gather specified records, not  
               including the contents of stored communications, from a  
               provider of electronic communication service or a remote  
               computing service by search warrant.

             b)   SB 662 (Figueroa), Chapter 896, Statutes of 1999,  
               established a procedure for obtaining and serving a search  
               warrant on a foreign corporation that provides electronic  
               communication services or remote computing service to the  
               general public and is registered to do business in  
               California.

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          Electronic Frontier Foundation (Sponsor)
          American Civil Liberties Union
          California Newspaper Publishers Association
          California Public Defenders Association

           Opposition 
           
          Association for Los Angeles Deputy Sheriffs
          California District Attorneys Association
          California Police Chiefs Association
          California State Sheriffs' Association
          Los Angeles County District Attorney's Office
          Los Angeles Police Protective League








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          Riverside Sheriffs' Association
           

          Analysis Prepared by  :    Stella Choe / PUB. S. / (916) 319-3744