1
00:00:03,480 --> 00:00:07,560
Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every

2
00:00:07,640 --> 00:00:10,440
Speaker 1: day we bring you insight and analysis into the most

3
00:00:10,480 --> 00:00:13,399
Speaker 1: important legal news of the day. You can find more

4
00:00:13,480 --> 00:00:18,040
Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud

5
00:00:18,320 --> 00:00:22,320
Speaker 1: and on Bloomberg dot com, Slash podcasts. Google and its

6
00:00:22,360 --> 00:00:25,360
Speaker 1: industry allies and making a late bid to water down

7
00:00:25,400 --> 00:00:28,600
Speaker 1: the first major data privacy law in the US, according

8
00:00:28,600 --> 00:00:32,640
Speaker 1: to Bloomberg sources. Joining me is Cardoke Marota, Bloomberg News

9
00:00:32,640 --> 00:00:38,080
Speaker 1: cybersecurity reporter who reported on this story first. So Cardoke,

10
00:00:38,280 --> 00:00:42,000
Speaker 1: many people may not be familiar with the California Consumer

11
00:00:42,040 --> 00:00:46,479
Speaker 1: Privacy Act tell us what it aims to do. The

12
00:00:46,560 --> 00:00:50,000
Speaker 1: c c p A is UH, California's response to GDPR

13
00:00:50,040 --> 00:00:53,519
Speaker 1: in Europe, and what it would allow UH users in

14
00:00:53,600 --> 00:00:58,480
Speaker 1: California to do is opt out of UH data aggregation

15
00:00:58,920 --> 00:01:03,240
Speaker 1: related to their idea entity. So, if you're browsing on

16
00:01:03,280 --> 00:01:06,839
Speaker 1: the Internet and like a pair of boots on Amazon

17
00:01:06,959 --> 00:01:09,440
Speaker 1: put them in your car, but don't buy them and

18
00:01:09,480 --> 00:01:12,960
Speaker 1: go to another website and add follows you, this law

19
00:01:12,959 --> 00:01:16,640
Speaker 1: would UH, as it currently stands, allow you to opt

20
00:01:16,720 --> 00:01:21,240
Speaker 1: out of Google or other entities from following you around

21
00:01:21,240 --> 00:01:24,160
Speaker 1: the Internet to advertise at you, and that applies to

22
00:01:24,480 --> 00:01:29,360
Speaker 1: multiple industries. And so what changes is Google looking for? Well,

23
00:01:29,360 --> 00:01:32,440
Speaker 1: they're looking for an exemption to allow for continued targeted

24
00:01:32,480 --> 00:01:37,319
Speaker 1: advertising and analysis of the data they collect while following

25
00:01:37,319 --> 00:01:41,360
Speaker 1: you around the internet. Uh. They generate over of their

26
00:01:41,400 --> 00:01:45,600
Speaker 1: revenue from uh AD sales and and so if they're

27
00:01:45,640 --> 00:01:49,120
Speaker 1: no longer allowed to follow you and then also take

28
00:01:49,160 --> 00:01:52,240
Speaker 1: that information, analyze it and sell it to a third

29
00:01:52,280 --> 00:01:56,720
Speaker 1: party that could potentially impact their bottom one. Does that

30
00:01:56,800 --> 00:02:00,680
Speaker 1: defeat the whole purpose of the law? Consumer privacy folks

31
00:02:00,720 --> 00:02:07,240
Speaker 1: certainly seem to think so. Uh. The lawmaker in Sacramento,

32
00:02:07,280 --> 00:02:09,200
Speaker 1: her name is Hannaboth Jackson, who has been the face

33
00:02:09,280 --> 00:02:11,800
Speaker 1: of the Consumer Privacy group, says that this exemption would

34
00:02:11,840 --> 00:02:13,760
Speaker 1: drive a truck through the c c p A. There

35
00:02:13,760 --> 00:02:16,520
Speaker 1: will be no point to it. So there were two

36
00:02:16,600 --> 00:02:19,799
Speaker 1: years of debate over the c c p A from

37
00:02:19,840 --> 00:02:23,040
Speaker 1: what I understand from your article. So what would the

38
00:02:23,080 --> 00:02:26,840
Speaker 1: procedure be to make changes at this late date? Yeah,

39
00:02:27,240 --> 00:02:30,960
Speaker 1: So c c p A sort of came into clarity

40
00:02:31,560 --> 00:02:33,920
Speaker 1: in the last three days of the two thousand eighteen

41
00:02:34,320 --> 00:02:39,320
Speaker 1: legislative session. We're in that same period now in uh

42
00:02:39,360 --> 00:02:41,840
Speaker 1: and there are a number of amendments on the table

43
00:02:42,000 --> 00:02:44,000
Speaker 1: to tinker with the c c p A. That's what

44
00:02:44,040 --> 00:02:47,239
Speaker 1: two thousand nineteen was all about. And so there are

45
00:02:47,360 --> 00:02:50,760
Speaker 1: proposals from lawmakers on the table to make these tweaks

46
00:02:50,840 --> 00:02:53,800
Speaker 1: before it kicks in, and we'll get clarity in the

47
00:02:53,840 --> 00:02:57,640
Speaker 1: next or thirty six hours. So then lawmakers would have

48
00:02:57,680 --> 00:03:00,720
Speaker 1: to approve a new ccp A. No, they would have

49
00:03:00,800 --> 00:03:03,840
Speaker 1: to approve a bill to amend the c c p A.

50
00:03:04,280 --> 00:03:08,880
Speaker 1: They would have to prove approve new legislation to tweak

51
00:03:09,000 --> 00:03:12,079
Speaker 1: the act that currently exists that kicks in on January one.

52
00:03:12,400 --> 00:03:15,920
Speaker 1: How likely is that to happen on ad tech and

53
00:03:15,960 --> 00:03:22,160
Speaker 1: target advertising? Extremely unlikely. Well, California's law, I mean, this

54
00:03:22,240 --> 00:03:25,640
Speaker 1: is the first privacy law in the US that you know,

55
00:03:25,720 --> 00:03:32,000
Speaker 1: comprehensive sort of Will that be an example for other states? Absolutely? Absolutely.

56
00:03:32,000 --> 00:03:35,320
Speaker 1: We know that Washington tried and failed to pass its

57
00:03:35,320 --> 00:03:37,960
Speaker 1: own this year. Some of that was related to they

58
00:03:38,000 --> 00:03:40,040
Speaker 1: don't know what what California is up to just yet.

59
00:03:40,320 --> 00:03:43,080
Speaker 1: Um Nevada has explicitly stated that they want to know

60
00:03:43,120 --> 00:03:46,400
Speaker 1: what happens in California before they push forward with their own.

61
00:03:46,680 --> 00:03:49,840
Speaker 1: We know Illinois has been a leader in privacy law. UM,

62
00:03:49,880 --> 00:03:53,560
Speaker 1: and not just states, but Congress is having the same

63
00:03:53,600 --> 00:03:56,640
Speaker 1: conversation in d C. And they're waiting to see what

64
00:03:57,160 --> 00:04:00,320
Speaker 1: the benchmark set by California is before they push forward

65
00:04:00,360 --> 00:04:04,880
Speaker 1: with any sort of legislation in one So certainly whatever

66
00:04:04,960 --> 00:04:09,960
Speaker 1: California does will set the baseline for data privacy laws

67
00:04:09,960 --> 00:04:13,800
Speaker 1: around the country. You spoke of California State Senator Jackson,

68
00:04:14,440 --> 00:04:16,960
Speaker 1: she said that this could shift the c c p A,

69
00:04:17,040 --> 00:04:21,800
Speaker 1: could shift the balance of power in Sacramento. How so well,

70
00:04:21,960 --> 00:04:25,479
Speaker 1: she says that over the last decade two decades, that

71
00:04:25,760 --> 00:04:29,720
Speaker 1: the tech industry has been able to ensure that this

72
00:04:29,839 --> 00:04:35,359
Speaker 1: wild West of deregulation remains the culture in Silicon Valley.

73
00:04:35,800 --> 00:04:40,480
Speaker 1: And she argues that with this stepping stone of data privacy,

74
00:04:40,760 --> 00:04:44,240
Speaker 1: you're creating an environment where where regulation can't be avoided

75
00:04:44,279 --> 00:04:47,039
Speaker 1: any longer, and and Silicon Valley has to come to

76
00:04:47,040 --> 00:04:50,320
Speaker 1: the table to discuss the rules of the game, which

77
00:04:50,440 --> 00:04:53,760
Speaker 1: she says haven't existed. And so that is the fundamental

78
00:04:53,839 --> 00:04:57,240
Speaker 1: change that there will actually be conversations about regulation going

79
00:04:57,320 --> 00:05:02,040
Speaker 1: forward instead of uh, no debate at all. UM. On

80
00:05:02,080 --> 00:05:05,559
Speaker 1: the surface, you hear a lot from Google and other

81
00:05:06,400 --> 00:05:11,840
Speaker 1: Internet companies about it's a good idea to respect privacy

82
00:05:11,920 --> 00:05:14,720
Speaker 1: and to have this kind of legislation, but does it

83
00:05:14,839 --> 00:05:18,560
Speaker 1: play out in reality? I mean that that is an

84
00:05:18,640 --> 00:05:21,599
Speaker 1: observation that we made in the story as well. Uh,

85
00:05:21,680 --> 00:05:25,880
Speaker 1: you know, the talking points are are are fantastic, and

86
00:05:26,240 --> 00:05:30,000
Speaker 1: h G DPRS is encouraged and welcomed and and other

87
00:05:30,800 --> 00:05:33,920
Speaker 1: legislations are are a good idea. But you know, we

88
00:05:34,000 --> 00:05:37,440
Speaker 1: see that Google has lobbied against this law in California.

89
00:05:37,520 --> 00:05:40,159
Speaker 1: We see they've lobbied against a similar law in Washington,

90
00:05:40,520 --> 00:05:44,240
Speaker 1: and they've tried to narrow a biometric law in Illinois

91
00:05:44,279 --> 00:05:47,800
Speaker 1: not once but twice. And so the question remains whether

92
00:05:48,279 --> 00:05:52,120
Speaker 1: the talking points are going to materialize in something, uh

93
00:05:52,200 --> 00:05:55,880
Speaker 1: in Congress or at these states beyond the lip service.

94
00:05:55,920 --> 00:05:58,680
Speaker 1: And I think right now what you're seeing is uh

95
00:05:58,720 --> 00:06:01,520
Speaker 1: that lobbyists are still being paid to protect the business

96
00:06:01,600 --> 00:06:04,720
Speaker 1: model instead of data privacy. Does it seem though, as

97
00:06:04,760 --> 00:06:08,880
Speaker 1: if there is a trend lately against tech, especially with

98
00:06:08,960 --> 00:06:12,120
Speaker 1: data privacy. And you just had Google paying a hundred

99
00:06:12,120 --> 00:06:15,560
Speaker 1: and seventy million to settle claims that have violated children's

100
00:06:15,600 --> 00:06:19,279
Speaker 1: privacy law, So is there is the tide turning against tech,

101
00:06:19,320 --> 00:06:22,120
Speaker 1: at least temporarily. Well, I think you're seeing that in

102
00:06:22,360 --> 00:06:25,719
Speaker 1: the fact that this amendment is unlikely to get anywhere. Uh.

103
00:06:25,920 --> 00:06:29,080
Speaker 1: Nobody seems to want to carry the industry's water right

104
00:06:29,080 --> 00:06:32,359
Speaker 1: now in Sacramento and be the face of the amendment

105
00:06:32,400 --> 00:06:35,839
Speaker 1: that allows big tech to continue to behave like big tech. Uh.

106
00:06:35,880 --> 00:06:38,720
Speaker 1: And so yes, I think there does appear to be,

107
00:06:38,760 --> 00:06:42,840
Speaker 1: at least in this current uh point in time, a

108
00:06:42,960 --> 00:06:46,000
Speaker 1: question about whether you want to be the company that

109
00:06:46,160 --> 00:06:50,880
Speaker 1: is pushing a loophole for Google to continue target advertising. Um.

110
00:06:50,960 --> 00:06:54,880
Speaker 1: We heard a lot before the the g DPR as

111
00:06:54,920 --> 00:06:58,440
Speaker 1: it was enacted in in Europe. Is there has there

112
00:06:58,480 --> 00:07:00,480
Speaker 1: been that much of a problem with it, because we

113
00:07:00,480 --> 00:07:02,200
Speaker 1: don't seem to be hearing as much about it, at

114
00:07:02,279 --> 00:07:04,279
Speaker 1: least I don't. Yeah. No, there've been a number of

115
00:07:04,279 --> 00:07:08,360
Speaker 1: fines issued uh in Europe over a lack of compliance. Uh,

116
00:07:08,360 --> 00:07:09,920
Speaker 1: It's it's been a year and a half and and

117
00:07:09,960 --> 00:07:12,560
Speaker 1: so companies are pointing to that and saying, look, these

118
00:07:12,640 --> 00:07:16,240
Speaker 1: aren't entities that are behaving maliciously. It just takes a

119
00:07:16,280 --> 00:07:19,680
Speaker 1: long time to come to grips with what these laws

120
00:07:20,360 --> 00:07:22,800
Speaker 1: are are doing and how they're changing the game. And

121
00:07:22,840 --> 00:07:24,880
Speaker 1: so that same question exists with c c p A

122
00:07:25,360 --> 00:07:28,800
Speaker 1: and and industry lobbyist and attorneys believe that the language

123
00:07:28,800 --> 00:07:31,160
Speaker 1: and c c p A is even more confusing and

124
00:07:31,240 --> 00:07:35,000
Speaker 1: bigger than it is in GDPR. And so these same

125
00:07:35,080 --> 00:07:39,840
Speaker 1: issues of compliance are going to to linger for extended

126
00:07:39,840 --> 00:07:42,920
Speaker 1: periods of time, maybe years, until companies can figure out

127
00:07:42,960 --> 00:07:45,920
Speaker 1: exactly how to fall into place. And so the Attorney

128
00:07:45,920 --> 00:07:48,160
Speaker 1: General in California is going to be the one in

129
00:07:48,280 --> 00:07:51,600
Speaker 1: charge of enforcement. And it will undoubtedly be a question

130
00:07:51,640 --> 00:07:56,480
Speaker 1: of whether or not UH companies that don't comply are

131
00:07:56,560 --> 00:08:00,480
Speaker 1: penalized or if they're given some sort of um leeway

132
00:08:00,600 --> 00:08:04,520
Speaker 1: to figure things out for extended period right, more battles ahead.

133
00:08:04,560 --> 00:08:08,280
Speaker 1: Thank you so much, Cardike. That's cardke Mrotrie, the Bloomberg

134
00:08:08,320 --> 00:08:13,080
Speaker 1: News cyber security reporter. Thanks for listening to the Bloomberg

135
00:08:13,200 --> 00:08:16,280
Speaker 1: Law Podcast. You can subscribe and listen to the show

136
00:08:16,320 --> 00:08:21,040
Speaker 1: on Apple Podcasts, SoundCloud, and on Bloomberg dot com slash podcast.

137
00:08:21,400 --> 00:08:24,160
Speaker 1: I'm June Brosso. This is Bloomberg