California continues to lead the nation in using privacy rights legislation to cut back the power of platform monopolies like Facebook, now with the California Delete Act, which was signed into law earlier this month. This sweeping new legislation takes aim at data brokers, the mysterious firms that collect—often through surreptitious “scraping” of websites—and then sell extensive amounts of data on individuals. For the first time, Californians will have the option to force brokers to purge that collected information and then to opt out of further collection going forward. To that end, the Act establishes a one-stop web portal where users can engage with every data broker registered with the state.

The bill’s designer, technology expert Tom Kemp, has long held that the data compiled by these shadowy firms has profound civil rights implications. Law enforcement and other government agencies today can easily buy data previously accessible only with a search warrant, including about a person’s online activity, family background, medical conditions, and even location history. And private actors increasingly use data from these firms to target individuals, including through hate-driven agendas, such as the well-known case of the high-ranking Catholic priest forced to resign after his brokered data revealed he was gay. Senator Elizabeth Warren and others have warned that such data could also be used to harass or prosecute women seeking abortion care.

In an interview with Open Markets, Kemp explained that the bill is modeled on the popular National Do Not Call Registry. At first, he says, “it was hard for lawmakers to envision this. But if you say it is like the Do Not Call Registry, then the light bulb goes off.” Kemp recently published a book on his work and thinking, Containing Big Tech.

But whereas the Do Not Call Registry takes a narrow view on what constitutes an unsolicited call, the Delete Act defines data brokers far more broadly. The bill also forces data brokers to disclose precisely which types of information they collect when registering with the state.

Given California’s large population, the new law will also likely have a big effect. Over 70 percent of U.S. phone numbers are enrolled in the National Do Not Call Registry. Assuming a similar percentage of Californians exercise their new rights under the Delete Act, brokers will be barred from collecting and storing the personal data of nearly a tenth of American adults.

The legislation builds on the 2018 California Privacy Protection Act, which first required data brokers operating in the state to register with the Attorney General’s office. Crucially, the new bill substantially boosts the state’s ability to enforce registration requirements. According to Kemp, California’s AG office has done little thus far to enforce compliance —which explains why only 500 of the estimated 4,000 data brokers in the state are currently registered. By transferring responsibility to the California Privacy Protection Agency and reprogramming funds for enforcement of non-registration, the California Delete Act will soon make this registry the nation’s premier source of information on data brokers.

California’s new reform comes at a moment when national efforts to bolster data privacy rights have come to a standstill, despite broad bipartisan support. The most serious bipartisan attempt to modernize American data privacy laws—the American Data Privacy and Protection Act—failed in the Senate during the last congressional session and has not been reintroduced. That failure has left Americans with far fewer data privacy rights than our European peers, who have benefited from the European Union’s recent General Data Protection Regulation and other laws. 

But this does not mean the federal government lacks tools to take on the data broker industry on behalf of the 300 million Americans who live outside California. The Federal Trade Commission (FTC) has recently taken steps toward cracking down on the industry’s abuses, such as its lawsuit against the data broker Kochava Inc. over its location history practices. The FTC’s broad rulemaking authority around unfair and deceptive business practices arguably enables them to create a tool like the Delete Act’s registry on the federal level. The results of an exploration into how to use that rulemaking power to enact new commercial surveillance regulations are pending. But as the Congressional Research Service has noted, the “intentionally flexible nature of the FTC Act” is reason to believe the commission has the authority to go big.

While Kemp expressed hesitation over the FTC taking such an aggressive view of its authority, he acknowledged the agency’s traditional enforcement tools against predatory data practices are currently underutilized. “They can use additional tools—discrimination, health care breach laws, etc.—to work data brokers… Over time, if you put enough enforcement actions together, you will create lines most of these brokers won’t cross.”

The Open Markets Institute has filed an amicus brief calling on the Supreme Court to put an end to baseball’s century-old antitrust exemption. The brief, written by Open Markets legal director Sandeep Vaheesan and antitrust attorney Jay Himes, argues that the enduring exemption has allowed Major League Baseball to exert monopoly-like control over major and minor league players and teams. In this case, the two teams that filed suit had their minor league affiliation terminated by MLB in late 2020, meaning they could no longer compete against the top minor league teams. More than a dozen states’ attorneys general have also weighed in on the case, urging the Court to end baseball’s antitrust immunity. 

“While baseball may be a national pastime, Major League Baseball’s (MLB) control over the minor leagues, unhindered by antitrust law, is a national disgrace,” the brief reads. “MLB and its clubs collude to cap minor league player salaries at poverty levels and to arbitrarily terminate the affiliation of minor league teams and rob many small towns of cherished local institutions.” Vaheesan penned an op-ed on the baseball exemption for the Boston Globe. Bloomberg Law wrote about the brief. Read the full brief here.

The Open Markets Institute and the AI Now Institute will host a conference, “AI and the Public Interest,” on November 15 to discuss the promise, threats, and practical regulatory challenges we face in managing the advent of large scale AI. The event, to be held at the JW Marriott in Washington D.C., will examine large-scale AI in relation to the already existing powers, structures, and behaviors of the corporations that control these technologies and the computing systems on which they depend. The conference will also ask whether antitrust and other competition law and policy can play a role in protecting democracy, individual health and wellbeing, the properties of creators, and open and competitive innovation from AI-related threats. The event will bring together leading policymakers, law enforcers, technologists, entrepreneurs, writers, musicians, policy experts, and academics from the United States and Europe. Follow updates here.

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