Updated Monday July 25, 2023:

With the powerful Committee on Energy and Commerce having approved a comprehensive, bipartisan privacy bill by a vote of 53-2, the US House of Representatives is one step closer to approving historic privacy legislation after over a decade of debate. Before formally reporting the legislation to the full House, the Committee adopted a substitute amendment that addressed concerns that had been raised in Subcommittee a few weeks ago. Among other provisions, the substitute amendment included the following changes:

• The amended ADPPA provides an explicit right for the California Privacy Protection Agency (“CPPA”) to enforce the law. This is likely in response to calls by California Governor Newsom and the CPPA itself this week to eliminate the bill’s would-be preemption of the California Consumer Privacy Act (including as amended by the California Privacy Rights Act) (“CCPA”). Notably, however, preemption of the CCPA remains.
• The definition of “third party” has been amended to provide that affiliated companies are considered a single covered entity if consumers reasonably expect them to share information with one another.
• The substitute amendment provides a number of additional changes with respect to targeted advertising, including :
  • The FTC has the authority to establish global privacy control or “unified opt-out mechanisms” to allow individuals to opt out from targeted advertising.
  • The ADPPA retains its ban on targeted ads to an individual under 17, and also still considers information relating to such individuals as sensitive covered data, but has introduced a tiered knowledge approach with respect to an individual’s age
  • Internet browsing history over time and across third party websites or online services is now considered sensitive data.
• Sensitive covered data has been further expanded to include race, color, ethnicity, religion, and union membership, and video data as a category of sensitive covered data has been clarified to include information showing the video content requested or selected by users of consumer generated media.

The leadership of the Committee appears to have found the sweet spot on the two major issues that have bedeviled legislators for years—how and to what extent to preempt state law and the extent to which consumers can vindicate their rights through a private right of action. The substitute amendment, for example, shortened from four year to two years after the date of enactment the date by which consumers can sue over alleged privacy violations. In addition, the substitute amendment limited forced arbitration agreements with respect to claims made by individuals facing domestic violence. With preemption and the private right of action now largely resolved, only a few additional minor issues, plus further changes to the arbitration provision, appear to stand in the way of likely House passage of the bill in September, if not before the August recess begins, on a bipartisan basis.

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Today the House Committee on Energy & Commerce met to markup the ADPPA in its second session riddled with heavy discussion and numerous amendments. The session began with Congresswoman Jan Shakowsky saying, “While this is not a perfect bill, I will support it as we have an imperative to protect consumers’ privacy.”

Bipartisan support, while apparent, could be tempered as core items in the ADPPA are eliciting strong reactions amongst both sides. Some issues came to light when it comes to arbitration, private right of action including class action, preemption, and enforcement, but Congresswoman Shakowsky hoped it would be a historic vote to move it forward. “If we don’t pass it now, I don’t think we’ll have the chance to pass it for a good long time,” said Congressman Jerry McNerney.

Many Democrats voiced support and desire to see the bill pass and expressed meaningful thanks for the bipartisan and bicameral nature. While no republicans made an opening statement, they made their positions heard through proposed amendments and concern for small businesses.

Among the bipartisan agreements expressed were many mentions of the following:

• Comprehensive federal legislation has been a long time coming.
• It still needs some work with almost everyone at the hearing referencing the AINS.
• There was a lot of discussion around preemption.
  • Schakowsky says it’s imperative to make a compromise in order to keep this legislation alive for consumers, but concern still remains about the patchwork of state requirements. Congresswoman Shakowsky reiterated that the goal is to get a “very strong bill passed” and with bipartisan support and as it stands today the proposed bill is “a product that we can really be proud of and I hope we pass it.”
  • Some expressed support of the preemption while some worried civilians in states like California are losing protection
• A large emphasis was placed on not overburdening small businesses with regulations that require things like Data Processing Officers for companies that don’t have a large digital footprint.
• Both sides stressed the importance of children’s data protection, but many are seeking a more expansive approach, especially in relation to social media.
• There is much concern about the enforcement of the ADPPA, both that CPPA would enforce federal legislation or that it would fall on the “underfunded FTC.”

All in all, it was a very harmonious session that will lead to further discussion and amendment of the proposed bill. Prior to today’s vote many said they will vote yes to keep momentum, but as the bill stands they will vote no on the floor when the time comes. Today’s final vote was 53-2 in support, with only Congresswomen Anna Eshoo and Nanette Barragan voting against.

Further sessions will seek to address the numerous amendments proposed on both sides of the House and Truyo will report the outcome of those sessions as they occur.