Appeal 'Forthcoming' of Calif. Age Appropriate Design Code Injunction, Says Co-Sponsor

Monday's decision of U.S. District Judge Beth Labson Freeman for Northern California granting NetChoice’s motion for a preliminary injunction to block California Attorney General Rob Bonta (D) from enforcing the state’s Age Appropriate Design Code (AB-2273) (see 2309180063) “lets Big Tech off the hook, and gives them a free pass to continue profiting off harm to our kids,” emailed California Assemblymember Buffy Wicks (D-Oakland), co-sponsor of AB-2273, through a spokesperson Tuesday.

The government "regulates scores of items our kids access daily -- from their carseats, to their toys, to their pajamas -- and it’s essential that we hold social media to a set of safety standards” said Wicks. She stands behind “the guardrails” included in the statute, and she supports the appeal “that will be forthcoming,” she said.

Bonta's office is “disappointed" with Freeman's decision, emailed a spokesperson Monday. Bonta “will respond in court as appropriate,” said the spokesperson, “Beyond that, we have no additional comment," including about whether the AG plans to appeal, said the spokesperson.

Freeman said NetChoice is likely to succeed in showing AB-2273's prohibitions limit the availability and use of information by certain speakers and for certain purposes and “thus regulate protected speech,” in violation of the First Amendment, in her order Monday (docket 5:22-cv-08861). The statute’s prohibitions restrict covered online businesses from collecting, selling, sharing or retaining any personal information for most purposes, said her order. She also said AB-2273 is federally preempted by the Children’s Online Privacy Protection Act and Section 230 of the Communications Decency Act.

The state argues AB-2273's regulation of the collection and use of children’s personal information “is akin to laws that courts have upheld as regulating economic activity, business practices, or other conduct without a significant expressive element,” said Freeman's order. But “there are two problems” with the state’s argument, it said. First, none of the decisions that the state cites for its “proposition” involved laws that, like AB-2273, “restricted the collection and sharing of information,” it said.

Second, in the U.S. Supreme Court’s 2011 decision in Sorrell v. IMS Health, evaluating a Vermont law restricting the sale, disclosure and use of information about the prescribing practices of individual doctors, the court said the law is “an unconstitutional regulation of speech, rather than conduct,” said the order. The state argues Sorrell doesn’t necessitate the conclusion that AB-2273's prohibitions “regulate speech,” it said. It argued Sorrell doesn’t say a business has a right to collect data from individuals, it said. It also argues the Vermont law “is generally distinguishable on the facts” from AB-2273, because the physicians involved “were willing participants in the data generation who had the power to restrict the use of their information,” it said.

But the state’s attempt to distinguish Sorrell based on the physicians’ ability to prevent their information from being collected isn’t “persuasive,” said the order. The Supreme Court said the law at issue “regulated speech based on its restrictions on the use of the information after it was collected, without including any reasoning about the nature of the source of the information,” it said.

'Keenly Aware' of 'Myriad Harms'

The court “is keenly aware of the myriad harms that may befall children on the internet,” said the order. It doesn’t seek to “undermine the government’s efforts” to resolve internet-based issues involving personal privacy and dignity, it said. But the court is troubled by AB-2273's “clear targeting of certain speakers,” including a segment of for-profit entities, but not governmental or nonprofit entities, that the statute “would prevent from collecting and using the information at issue,” it said.

As the Supreme Court noted in its 2011 decision in Sorrell, the state’s arguments about the broad protections engendered by a challenged law “are weakened by the law’s application to a narrow set of speakers,” said the order. The court said NetChoice is likely to succeed in showing that AB-2273's prohibitions and mandates regulate speech, so the statute “triggers First Amendment scrutiny.”

For AB-2273 “to survive commercial speech scrutiny,” the state must show the statute’s challenged provisions “directly advance a substantial government interest by materially alleviating real harms,” said the order. But based on evidence before the court, the statute’s age estimation provision appears “unlikely to materially alleviate the harm of insufficient data and privacy protections for children,” it said.

The court rather said the provision actually is “likely to exacerbate the problem by inducing covered businesses to require consumers, including children, to divulge additional personal information,” in the order. “NetChoice is likely to succeed in showing that the provision’s clause applying the same process to all users fails commercial speech scrutiny,” it said. The court said the state “failed to satisfy its burden to justify the age estimation provision” as directly advancing the state’s “substantial interest in protecting the physical, mental, and emotional health and well-being of minors.”

The state cites the Supreme Court’s 2013 decision in Maryland v. King to support its “proposition” that any time a state is enjoined by a court from "effectuating statutes enacted by representatives of its people," it suffers a form of irreparable injury, said the order. King didn’t involve a motion for preliminary injunction but rather Maryland’s application for a stay of a state appellate court’s decision overturning Alonzo King’s rape conviction, pending disposition of Maryland’s cert petition, it said. SCOTUS said a stay was warranted based on its determination there was “a reasonable probability” it would grant cert, it said.

Md. Case 'Has No Application Here

It was in that context that SCOTUS discussed the harm to Maryland flowing from its inability “to effectuate its DNA collection statute,” it said. The quoted language in King “has no application here,” where, unlike Maryland, California hasn’t made a showing “that the challenged statute passes constitutional muster,” it said.

NetChoice supporters roundly hailed Freeman's injunction order in a series of tweets, blog posts and prepared statements Monday and Tuesday. The Computer & Communications Industry Association is pleased that the court “has recognized the core First Amendment principles at stake” in AB-2273, and has put “this harmful statute” on hold until NetChoice’s challenges “can be fully reviewed,” Senior Vice President-Chief of Staff Stephanie Joyce said in a statement Monday. “Though on its face this statute appears to protect personal data, it contains many more problematic provisions, including compelled speech, that conflict with federal law and the vision our founders had for communications by and among private entities.”

The Chamber of Progress is "very proud" its amicus brief in support of NetChoice was cited in the court’s injunction order, CEO Adam Kovacevich said on the X platform, formerly known as Twitter. He retweeted Jess Miers, the chamber's legal advocacy counsel, who highlighted two excerpts from the order. One referenced children who may benefit from access to reproductive health information online, the other an amici brief from the LGBT Tech Am in which the group said: "What is ‘in the best interest of children’ is not an objective standard but rather a contentious topic of political debate.”

NetChoice's teams “are fighting for the First Amendment and winning all over the country,” Wiley attorney Megan Brown tweeted. She filed an amicus brief for the U.S. Chamber of Commerce in February in support of NetChoice. The ruling was a “huge win for online” and for “all internet users,” tweeted Michael Petricone, CTA senior vice president-government affairs.

The American Enterprise Institute thinks AB-2273’s requirement that social media platforms report on their hate moderation efforts might well be "a First Amendment overstep,” tweeted Clay Calvert, nonresident senior fellow. Lawmakers across blue and red states are adopting statutes that compel social media companies to disclose information about their platforms’ content-moderation policies, “all ostensibly in the benign interest of transparency," blogged Calvert Tuesday.