California Legislature—2015–16 Regular Session

Assembly BillNo. 739


Introduced by Assembly Member Irwin

February 25, 2015


An act to amend Section 1798.82 of the Civil Code, relating to privacy.

LEGISLATIVE COUNSEL’S DIGEST

AB 739, as introduced, Irwin. Information privacy.

Existing law requires a person or business conducting business in California that owns or licenses computerized data that includes personal information, as defined, to disclose, as specified, a breach of the security of the system or data following discovery or notification of the security breach to any California resident whose personal information was, or is reasonably believed to have been, acquired by an unauthorized person, unless the information was encrypted. Existing law also requires a person or business that maintains computerized data that includes personal information that the person or business does not own to notify the owner or licensee of the information of any breach of the security of the data immediately following discovery, as specified.

This bill would make a nonsubstantive change to those provisions.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P1    1

SECTION 1.  

Section 1798.82 of the Civil Code is amended
2to read:

P2    1

1798.82.  

(a) A person or business that conducts business in
2California, and that owns or licenses computerized data that
3includes personal information, shall disclose a breach of the
4security of the system following discovery or notification of the
5breach in the security of the data to a resident of California whose
6unencrypted personal information was, or is reasonably believed
7to have been, acquired by an unauthorized person. The disclosure
8shall be madebegin delete in the most expedient timeend deletebegin insert as quickly asend insert possible
9and without unreasonable delay, consistent with the legitimate
10needs of law enforcement, as provided in subdivision (c), or any
11measures necessary to determine the scope of the breach and restore
12the reasonable integrity of the data system.

13(b) A person or business that maintains computerized data that
14includes personal information that the person or business does not
15own shall notify the owner or licensee of the information of the
16breach of the security of the data immediately following discovery,
17if the personal information was, or is reasonably believed to have
18been, acquired by an unauthorized person.

19(c) The notification required by this section may be delayed if
20a law enforcement agency determines that the notification will
21impede a criminal investigation. The notification required by this
22section shall be made promptly after the law enforcement agency
23determines that it will not compromise the investigation.

24(d) A person or business that is required to issue a security
25breach notification pursuant to this section shall meet all of the
26following requirements:

27(1) The security breach notification shall be written in plain
28language.

29(2) The security breach notification shall include, at a minimum,
30the following information:

31(A) The name and contact information of the reporting person
32or business subject to this section.

33(B) A list of the types of personal information that were or are
34reasonably believed to have been the subject of a breach.

35(C) If the information is possible to determine at the time the
36notice is provided, then any of the following: (i) the date of the
37breach, (ii) the estimated date of the breach, or (iii) the date range
38within which the breach occurred. The notification shall also
39include the date of the notice.

P3    1(D) Whether notification was delayed as a result of a law
2enforcement investigation, if that information is possible to
3determine at the time the notice is provided.

4(E) A general description of the breach incident, if that
5information is possible to determine at the time the notice is
6provided.

7(F) The toll-free telephone numbers and addresses of the major
8credit reporting agencies if the breach exposed a social security
9number or a driver’s license or California identification card
10number.

11(G) If the person or business providing the notification was the
12source of the breach, an offer to provide appropriate identity theft
13prevention and mitigation services, if any, shall be provided at no
14cost to the affected person for not less than 12 months, along with
15all information necessary to take advantage of the offer to any
16person whose information was or may have been breached if the
17breach exposed or may have exposed personal information defined
18in subparagraphs (A) and (B) of paragraph (1) of subdivision (h).

19(3) At the discretion of the person or business, the security
20breach notification may also include any of the following:

21(A) Information about what the person or business has done to
22protect individuals whose information has been breached.

23(B) Advice on steps that the person whose information has been
24breached may take to protect himself or herself.

25(4) In the case of a breach of the security of the system involving
26personal information defined in paragraph (2) of subdivision (h)
27for an online account, and no other personal information defined
28in paragraph (1) of subdivision (h), the person or business may
29comply with this section by providing the security breach
30notification in electronic or other form that directs the person whose
31personal information has been breached promptly to change his
32or her password and security question or answer, as applicable, or
33to take other steps appropriate to protect the online account with
34the person or business and all other online accounts for which the
35 person whose personal information has been breached uses the
36same user name or email address and password or security question
37or answer.

38(5) In the case of a breach of the security of the system involving
39personal information defined in paragraph (2) of subdivision (h)
40for login credentials of an email account furnished by the person
P4    1or business, the person or business shall not comply with this
2section by providing the security breach notification to that email
3address, but may, instead, comply with this section by providing
4notice by another method described in subdivision (j) or by clear
5and conspicuous notice delivered to the resident online when the
6resident is connected to the online account from an Internet
7Protocol address or online location from which the person or
8business knows the resident customarily accesses the account.

9(e) A covered entity under the federal Health Insurance
10Portability and Accountability Act of 1996 (42 U.S.C. Sec. 1320d
11et seq.) will be deemed to have complied with the notice
12requirements in subdivision (d) if it has complied completely with
13Section 13402(f) of the federal Health Information Technology
14for Economic and Clinical Health Act (Public Law 111-5).
15However, nothing in this subdivision shall be construed to exempt
16a covered entity from any other provision of this section.

17(f) A person or business that is required to issue a security breach
18notification pursuant to this section to more than 500 California
19residents as a result of a single breach of the security system shall
20electronically submit a single sample copy of that security breach
21notification, excluding any personally identifiable information, to
22the Attorney General. A single sample copy of a security breach
23notification shall not be deemed to be within subdivision (f) of
24Section 6254 of the Government Code.

25(g) For purposes of this section, “breach of the security of the
26system” means unauthorized acquisition of computerized data that
27compromises the security, confidentiality, or integrity of personal
28information maintained by the person or business. Good faith
29acquisition of personal information by an employee or agent of
30the person or business for the purposes of the person or business
31is not a breach of the security of the system, provided that the
32personal information is not used or subject to further unauthorized
33disclosure.

34(h) For purposes of this section, “personal information” means
35either of the following:

36(1) An individual’s first name or first initial and last name in
37combination with any one or more of the following data elements,
38when either the name or the data elements are not encrypted:

39(A) Social security number.

P5    1(B) Driver’s license number or California identification card
2number.

3(C) Account number, credit or debit card number, in
4 combination with any required security code, access code, or
5password that would permit access to an individual’s financial
6account.

7(D) Medical information.

8(E) Health insurance information.

9(2) A user name or email address, in combination with a
10password or security question and answer that would permit access
11to an online account.

12(i) (1) For purposes of this section, “personal information” does
13not include publicly available information that is lawfully made
14available to the general public from federal, state, or local
15government records.

16(2) For purposes of this section, “medical information” means
17any information regarding an individual’s medical history, mental
18or physical condition, or medical treatment or diagnosis by a health
19care professional.

20(3) For purposes of this section, “health insurance information”
21 means an individual’s health insurance policy number or subscriber
22identification number, any unique identifier used by a health insurer
23to identify the individual, or any information in an individual’s
24application and claims history, including any appeals records.

25(j) For purposes of this section, “notice” may be provided by
26one of the following methods:

27(1) Written notice.

28(2) Electronic notice, if the notice provided is consistent with
29the provisions regarding electronic records and signatures set forth
30in Section 7001 of Title 15 of the United States Code.

31(3) Substitute notice, if the person or business demonstrates that
32the cost of providing notice would exceed two hundred fifty
33thousand dollars ($250,000), or that the affected class of subject
34persons to be notified exceeds 500,000, or the person or business
35does not have sufficient contact information. Substitute notice
36shall consist of all of the following:

37(A) Email notice when the person or business has an email
38address for the subject persons.

P6    1(B) Conspicuous posting of the notice on the Internet Web site
2page of the person or business, if the person or business maintains
3one.

4(C) Notification to major statewide media.

5(k) Notwithstanding subdivision (j), a person or business that
6maintains its own notification procedures as part of an information
7security policy for the treatment of personal information and is
8otherwise consistent with the timing requirements of this part, shall
9be deemed to be in compliance with the notification requirements
10of this section if the person or business notifies subject persons in
11accordance with its policies in the event of a breach of security of
12the system.



O

    99