BILL ANALYSIS
SB 1383
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Date of Hearing: June 25, 2002
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT AND THE ECONOMY
Sarah Reyes, Chair
SB 1383 (Bowen) - As Amended: June 20, 2002
SENATE VOTE : 22-13
SUBJECT : Electronic mail: service providers
SUMMARY : The bill requires electronic mail service providers
to give customers at least 30 days notice before terminating the
customer's service. Specifically, this bill :
1)Defines the term "provider" to mean the entity that controls a
customer's e-mail address, but not the entity making the
underlying network or access available to provider or
customer.
2)States that a provider cannot be held liable under the
provisions of the bill, if the customer's e-mail service is
terminated as a result of violations to the provider' s
"Acceptable Use Policies."
3)Gives customers the right to sue a provider for violation of
the provision and receive either actual damages, or liquidated
damages in the amount of $50.
4)Preempts local government, and local agency rules, regarding
notice of e-mail service termination.
5)Becomes inoperative if federal law or regulation is enacted
that regulates termination notice requirements for electronic
mail service.
6)Is applicable in single plaintiff actions and shall not be
applicable in multiple plaintiff or class actions.
7) States that no contract may be terminated without cause.
EXISTING LAW Current law does not regulate the notice
provision for termination of service by e-mail providers.
Provisions in the Public Utilities Code regulate utilities as
follows:
SB 1383
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1)Requires electric, gas, heat and water utilities to provide at
least 15 days before terminating service, due to the
customer's failure to pay a delinquent balance
a) Public utilities that violate this notice requirement
are subject to a misdemeanor, punishable by a fine of up to
$1,000, or imprisonment for up to one year, or both.
2) Requires cable and satellite companies to provide at least
15 days before terminating service,
due to a customer's failure to pay a delinquent bill.
a) City and county governments have authority to set
penalties for cable and satellite companies that
violate this notice requirement, but limit those penalties
to no more than $200 per day, not to exceed a total of $600
per occurrence.
FISCAL EFFECT : Unknown
COMMENTS : Consumers and businesses have come to rely on e-mail
services to conduct much of their business. Many people today
use e-mail to take care of everyday business that they used to
handle by the telephone or mail.
On December 1, 2001, more than 850,000 subscribers of Exite@Home
e-mail services, provided via AT&T Broadband, were cut off from
service without notice and left without Internet access for
several days, before being moved to a new network. This created
inconvenience and disruption for customers because they could
not access their e-mail or self-created web pages.
Important messages, e-mail address books and intellectual
property in the form of web sites were lost and customers were
left scrambling to find other e-mail providers.
This bill will provide some protection for customers by
requiring a 30-day notice before termination. This 30-day window
will allow customers the time to establish new e-mail accounts,
save intellectual property and communicate their new information
to others.
This bill recognizes the importance and legitimacy of e-mail as
a vital communication tool and extends protections to e-mail
users that are similar to the protections currently enjoyed by
SB 1383
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customers of telephone, electricity, natural gas, water, cable
and satellite providers.
Note : While the bill requires 30 days notice before the
termination of service, it does allow the provider to cut off
service, without notice, if the customer violates the service
contract. This allows providers to quickly shut down spammers,
hackers and others who disrupt legitimate e-mail users.
Related legislation : AB 1814 (Reyes) Requires Internet
Service Providers, unless otherwise specified by law or
contract, to notify customers 30 days in advance of exiting the
business of providing Internet access services.
STATUS: (pending) Senate Energy, Utilities and Communications
Committee
SUPPORT :
California Alliance for Consumer Protection
Consumers Union
OPPOSITION :
American Electronics Association
California Cable & Telecommunications Association
Internet Alliance
Microsoft
Analysis Prepared by : Tim Reardon / J., E.D. & E. / (916)
319-2090