August 24, 2022, marked a milestone for the California Consumer Privacy Act (CCPA), the California Attorney General announced the first enforcement and settlement against beauty retailer Sephora.

Since July 2022, the California Attorney General’s (AG) office conducted an investigative sweep of online retailers to check compliance with the CCPA and sent out over 100 notices of alleged CCPA violations. The notices provided a 30-day period for businesses to correct alleged violations before an enforcement measure is taken. Attorney General Rob Bonta stated that after the notices, the “vast majority” of businesses changed their practices to comply with the CCPA.

The State alleged that Sephora violated the CCPA by failing to disclose to consumers it was selling their personal information, failed to process user requests to opt out of sale via user-enabled global privacy controls, and that the company did not cure these violations within the 30-day period of notice. Specifically, the State alleged that Sephora failed to notify its consumers that it had arrangements with third-parties (such as market research firms) where Sephora allowed them to install tracking software on its website and app so that third-parties could monitor consumers as they shopped. Under the terms of the settlement, “sale” included “sale using online tracking technology” which was broadly defined as where a business discloses or makes available consumers’ personal information to third parties through the use of online tracking technologies such as pixels, web beacons, software developer kits, third party library, and cookies in exchange for monetary or other valuable consideration, including personal information or other information such as analytics or free or discounted services. Meaning the idea of “sale” was broader than simply selling information to a third party in exchange for money.

The State considered Sephora’s arrangement with these third-parties a “sale” of consumer information under the CCPA. In short, the State alleged that: “Sephora did not tell consumers that it sold their personal information; instead, Sephora did the opposite, telling California consumers on its website that ‘we do not sell personal information.’”

The State and Sephora have reached a settlement that includes $1.2 million in penalties and as well as injunctive terms including:

  • Allow for consumers to opt-out of the sale of personal info, including via Global Privacy Control
  • Clarify its online disclosures and privacy policy
  • Conform its service provider agreements to the CCPA
  • Provide reports to the Attorney General relating to its sale of personal information

On January 1, 2023, the California Privacy Rights Act (CPRA) takes effect and amends the CCPA to eliminate the cure period and instead only allow the California Privacy Protection Agency (CPPA) discretion to provide time to cure.

In light of the State’s push toward enforcement and the rapidly approaching effective date of the CPRA, businesses must review their compliance efforts with the CCPA and CPRA. If you need assistance with compliance contact a Jackson Lewis attorney or the CCPA Team.

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Photo of Joseph J. Lazzarotti Joseph J. Lazzarotti

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP)…

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP) with the International Association of Privacy Professionals. Trained as an employee benefits lawyer, focused on compliance, Joe also is a member of the firm’s Employee Benefits practice group.

In short, his practice focuses on the matrix of laws governing the privacy, security, and management of data, as well as the impact and regulation of social media. He also counsels companies on compliance, fiduciary, taxation, and administrative matters with respect to employee benefit plans.

Privacy and cybersecurity experience – Joe counsels multinational, national and regional companies in all industries on the broad array of laws, regulations, best practices, and preventive safeguards. The following are examples of areas of focus in his practice:

  • Advising health care providers, business associates, and group health plan sponsors concerning HIPAA/HITECH compliance, including risk assessments, policies and procedures, incident response plan development, vendor assessment and management programs, and training.
  • Coached hundreds of companies through the investigation, remediation, notification, and overall response to data breaches of all kinds – PHI, PII, payment card, etc.
  • Helping organizations address questions about the application, implementation, and overall compliance with European Union’s General Data Protection Regulation (GDPR) and, in particular, its implications in the U.S., together with preparing for the California Consumer Privacy Act.
  • Working with organizations to develop and implement video, audio, and data-driven monitoring and surveillance programs. For instance, in the transportation and related industries, Joe has worked with numerous clients on fleet management programs involving the use of telematics, dash-cams, event data recorders (EDR), and related technologies. He also has advised many clients in the use of biometrics including with regard to consent, data security, and retention issues under BIPA and other laws.
  • Assisting clients with growing state data security mandates to safeguard personal information, including steering clients through detailed risk assessments and converting those assessments into practical “best practice” risk management solutions, including written information security programs (WISPs). Related work includes compliance advice concerning FTC Act, Regulation S-P, GLBA, and New York Reg. 500.
  • Advising clients about best practices for electronic communications, including in social media, as well as when communicating under a “bring your own device” (BYOD) or “company owned personally enabled device” (COPE) environment.
  • Conducting various levels of privacy and data security training for executives and employees
  • Supports organizations through mergers, acquisitions, and reorganizations with regard to the handling of employee and customer data, and the safeguarding of that data during the transaction.
  • Representing organizations in matters involving inquiries into privacy and data security compliance before federal and state agencies including the HHS Office of Civil Rights, Federal Trade Commission, and various state Attorneys General.

Benefits counseling experience – Joe’s work in the benefits counseling area covers many areas of employee benefits law. Below are some examples of that work:

  • As part of the Firm’s Health Care Reform Team, he advises employers and plan sponsors regarding the establishment, administration and operation of fully insured and self-funded health and welfare plans to comply with ERISA, IRC, ACA/PPACA, HIPAA, COBRA, ADA, GINA, and other related laws.
  • Guiding clients through the selection of plan service providers, along with negotiating service agreements with vendors to address plan compliance and operations, while leveraging data security experience to ensure plan data is safeguarded.
  • Counsels plan sponsors on day-to-day compliance and administrative issues affecting plans.
  • Assists in the design and drafting of benefit plan documents, including severance and fringe benefit plans.
  • Advises plan sponsors concerning employee benefit plan operation, administration and correcting errors in operation.

Joe speaks and writes regularly on current employee benefits and data privacy and cybersecurity topics and his work has been published in leading business and legal journals and media outlets, such as The Washington Post, Inside Counsel, Bloomberg, The National Law Journal, Financial Times, Business Insurance, HR Magazine and NPR, as well as the ABA Journal, The American Lawyer, Law360, Bender’s Labor and Employment Bulletin, the Australian Privacy Law Bulletin and the Privacy, and Data Security Law Journal.

Joe served as a judicial law clerk for the Honorable Laura Denvir Stith on the Missouri Court of Appeals.