throbber

`
`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 1 of 40
`
`
`AMBIKA KUMAR (pro hac vice application forthcoming)
` ambikakumar@dwt.com
`DAVIS WRIGHT TREMAINE LLP
`920 Fifth Avenue, Suite 3300
`Seattle, Washington 98104
`Telephone: (206) 757-8030
`
`ADAM S. SIEFF (CA Bar No. 302030)
` adamsieff@dwt.com
`DAVIS WRIGHT TREMAINE LLP
`865 South Figueroa Street, 24th Floor
`Los Angeles, California 90017-2566
`Telephone: (213) 633-6800
`ROBERT CORN-REVERE (pro hac vice application forthcoming)
` bobcornrevere@dwt.com
`DAVID M. GOSSETT (pro hac vice application forthcoming)
` davidgossett@dwt.com
`MEENAKSHI KRISHNAN (pro hac vice application forthcoming)
` meenakshikrishnan@dwt.com
`DAVIS WRIGHT TREMAINE LLP
`1301 K Street NW, Suite 500 East
`Washington, D.C. 20005
`Telephone: (202) 973-4200
`
`Attorneys for Plaintiff
`NETCHOICE, LLC d/b/a NetChoice
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`
`THE NORTHERN DISTRICT OF CALIFORNIA
`
`SAN JOSE DIVISION
`
`
`
`NETCHOICE, LLC d/b/a NetChoice,
`
`
`Plaintiff,
`
`v.
`
`
`ROB BONTA, ATTORNEY GENERAL
`OF THE STATE OF CALIFORNIA,
`in his official capacity,
`
`
`Defendant.
`
`
`
`
` Case No.
`
`
`
`COMPLAINT FOR DECLARATORY
`AND INJUNCTIVE RELIEF
`
`
`
`
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
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`5:22-cv-8861
`
`

`

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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 2 of 40
`
`I. PRELIMINARY STATEMENT
`1.
`Although styled as a privacy regulation to protect minors, the California Age-
`Appropriate Design Code Act (AB 2273)1 is a content-based restriction on speech that will subject
`a global communications medium to state supervision and hobble a free and open resource for
`“exploring the vast realms of human thought and knowledge.” Packingham v. N. Carolina, 137
`S. Ct. 1730, 1737 (2017).
`2.
`Among its many infirmities, AB 2273 presses companies to serve as roving censors
`of speech on the Internet. The law imposes on private firms, big and small, the obligation to
`identify and “mitigate” speech that is “harmful or potentially harmful” to users under 18 years old,
`and to “prioritize” speech that promotes such users’ “well-being” and “best interests.” If firms
`guess the meaning of these inherently subjective terms wrong—or simply reach different
`conclusions than do government regulators—the State is empowered to impose crushing financial
`penalties. The State can also impose such penalties if companies fail to enforce their content
`moderation standards to the Attorney General’s satisfaction. AB 2273 does this without so much
`as a nod to whether the law’s restrictions are necessary to serve a compelling state interest.
`3.
`Rather than protect minors, AB 2273 will harm them, along with the Internet as a
`whole. Faced with arbitrary application of AB 2273’s draconian penalties, online businesses will
`face overwhelming pressure to over-moderate content to avoid the law’s penalties for content the
`State deems harmful. Such over-moderation will restrict the availability of information for users
`of all ages and stifle important resources, particularly for vulnerable youth who rely on the Internet
`for life-saving information.2 Separately, AB 2273 will require businesses to verify the ages of
`their users, which—to the extent it can even be done to the State’s satisfaction—will frustrate
`anonymous and casual browsing, magnify privacy concerns, and wrest control over minors’ online
`activities from parents and their children.
`
`1 AB 2273 as enacted is attached as Exhibit A and will be codified in relevant part beginning at Section 1798.99.28 to
`Part 4 of Division 3 of the California Civil Code.
`2 See “Coalition Letter on Privacy and Free Expression Threats in Kids Online Safety Act” Regarding Opposition to
`S. 3663 (Nov. 28, 2022) (“Online services would face substantial pressure to over-moderate, including from state
`Attorneys General seeking to make political points about what kind of information is appropriate for young people.”),
`available at https://cdt.org/wp-content/uploads/2022/11/Coalition-letter-opposing-Kids-Online-Safety-Act-28-Nov-
`PM.pdf.
`
`1
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
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`4.
`For these and other reasons, AB 2273 is facially unconstitutional on at least four
`grounds and is preempted by two federal statutes: The Act on its face violates the First
`Amendment, Fourth Amendment, and the Due Process and Commerce Clauses of the United States
`Constitution; violates Article I, Sections 2(a) and 7(a) of the California Constitution; and is
`preempted by the Children’s Online Privacy Protection Act (COPPA), 15 U.S.C. §§ 6501 et seq.,
`and the COPPA Rule, 16 C.F.R. § 312.1 et seq., as well as Section 230 of the Communications
`Decency Act, 47 U.S.C. § 230. Plaintiff NetChoice, LLC accordingly seeks an order declaring
`AB 2273 invalid and enjoining its enforcement.
`II. PARTIES AND STANDING
`5.
`NetChoice is a non-profit entity organized under Section 501(c)(6) of the Internal
`Revenue Code created in and existing under the laws of the District of Columbia. NetChoice is a
`national trade association of online businesses that share the goal of promoting free speech and
`free enterprise on the Internet. A list of NetChoice’s members is available at https://netchoice.org/
`about/. For more than two decades, NetChoice has worked to promote online commerce and
`speech and to increase consumer access and options through the Internet. NetChoice’s members
`devote significant attention, time, and money to safeguard children online.
`6.
`Most of NetChoice’s members are directly subject to and regulated by AB 2273
`and could face serious legal consequences if they fail to comply with the Act’s directives. And
`NetChoice itself anticipates having to divert resources to address these consequences and support
`its members in connection with AB 2273’s demands.
`7.
`NetChoice and its members will suffer irreparable harm—including infringement
`of their constitutional rights—if AB 2273 is not declared invalid and enjoined before it takes effect.
`8.
`Defendant Rob Bonta is the Attorney General of the State of California. Defendant
`is responsible for enforcing the provisions of AB 2273 challenged by this action, including because
`the Act authorizes the Attorney General to bring a “civil action … in the name of the people of the
`State of California.” § 1798.99.35(a).
`III. JURISDICTION
`This action arises under the United States Constitution, particularly the Commerce
`
`9.
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
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`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 4 of 40
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`Clause, art. I, § 8, cl. 3, and Supremacy Clause, art. VI, and the First, Fourth, and Fourteenth
`Amendments, as well as the California Constitution, art. I, §§ 2(a) and 7(a). It also arises under
`the Civil Rights Act, 42 U.S.C. §§ 1983 and 1988, the Communications Decency Act, 47 U.S.C.
`§ 230, and COPPA, 15 U.S.C. §§ 6501 et seq.
`10.
`This Court has subject-matter jurisdiction over this action under 28 U.S.C. §§ 1331,
`1343(a), and 1367(a) because NetChoice’s claims either arise under federal law or else share a
`common nucleus of operative fact with claims that arise under federal law.
`11.
`This Court has authority under the Declaratory Judgment Act, 28 U.S.C. § 2201(a),
`to decide this dispute and award relief because it presents an actual case or controversy within the
`Court’s jurisdiction.
`
`IV. VENUE
`12.
`Venue is proper in this District under 28 U.S.C. § 1391(b)(1) & (2) because
`Defendant performs his duties and thus resides in this District, and because the injuries giving rise
`to this action have been and will continue to be suffered by NetChoice and its members in Santa
`Clara County, California.
`
`V. DIVISIONAL ASSIGNMENT
`13.
`Assignment to the San Jose Division is proper under Local Civil Rule 3-2(c) & (e)
`because the injuries giving rise to this action have been and will continue to be suffered by
`NetChoice and its members in Santa Clara County, California.
`VI. FACTUAL ALLEGATIONS
`A.
`Online Businesses and Website Architecture
`14.
`Online businesses interact with users in different ways. Most have universally
`accessible areas, in which a user can view product listings, preview services, and read reviews
`without creating or logging into an account. Many online businesses also have features that are
`optimized and available only for individuals who create an account or sign up for membership.
`Some social media services, for example, permit non-members to view public portions of a user’s
`profile, but not to view each post in detail. Similarly, many online businesses require users to
`create accounts before they can use or purchase an online service.
`
`3
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
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`15.
`Some businesses opt for a free account-based model, where access to online
`services is provided without charge, but users must provide certain information and create accounts
`to access those services. Other businesses use a subscription-based model requiring users to create
`accounts and pay fees to use the online service. Irrespective of model, many online businesses
`rely on advertisements to earn a significant share of—and in some cases, all of—the revenue that
`supports the content and services they provide.
`16. Many online businesses that are principally ad-supported publish and deliver
`content to users, who engage with particular content by, for example, writing a review, reading a
`news article, downloading a movie, streaming an album, “liking” a post, or purchasing books based
`on author or genre. This engagement, in turn, enables online businesses to serve users with
`advertisements or marketing targeted to their expressed interests.3 Ads can appear alongside
`hosted content, in promoted search results, or in email marketing or newsletters. At its core,
`targeted advertising leverages technology to improve commercial speech and makes possible a
`wide range of protected non-commercial speech. Advertisers pay a premium for the ability to
`reach a more specific audience; users benefit from subsidized access to content and more relevant
`advertisements; and online business operators—including smaller niche bloggers and individual
`“influencers” who use larger services—are able earn a living by monetizing their talents for
`creating, curating, and publishing popular and interesting content.4
`17.
`Even independently of advertising, content promotion is a key service that online
`businesses offer—and often a key source of revenue. An online service’s ability to suggest a new
`release based on the user’s browsing history, for example, creates value for the user, generates
`business for the service, and connects content creators with an audience. This is true across
`industry—music, movies, television shows, social media posts, and anything else an Internet user
`might be interested in purchasing, reading, hearing, or viewing.
`
`
`3 See generally David S. Evans, “The Economics of the Online Advertising Industry,” 7 REV. OF NETWORK ECON. 3
`(2008), available at https://doi.org/10.2202/1446-9022.1154.
`4 See, e.g., Joel Matthew, “Understanding Influencer Marketing And Why It Is So Effective,” FORBES (July 30, 2018),
`available at https://tinyurl.com/3fr7zban; Jacob Goldenberg et al., “The Research Behind Influencer Marketing,” J.
`OF MARKETING RESEARCH (Feb. 2021), available at https://tinyurl.com/2j2863m5.
`
`4
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 6 of 40
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`B.
`AB 2273
`18.
`On September 15, 2022, California Governor Gavin Newsom signed AB 2273.
`19.
`According to the Assembly bill analysis, one of the Act’s overarching purposes is
`to favor certain types of online speech by “elevat[ing] child-centered design in online products and
`services that are likely to be accessed by children.”5 AB 2273 includes legislative findings that
`“the design of online products and services on children’s well-being has become a focus of
`significant concern,” and that “children should be afforded protections not only by online products
`and services specifically directed at them, but by all online products and services they are likely to
`access.” AB 2273 § 1(a)(2), (a)(5).
`1.
`The breadth of businesses affected by AB 2273
`20.
`AB 2273 applies to any “business that provides an online service, product, or
`feature likely to be accessed by children.” § 1798.99.31(a)-(b). The law defines “children” as any
`“consumer or consumers who are under 18 years of age.” § 1798.99.30(b)(1). This definition
`encompasses “children” old enough to drive and who might be just days shy of the right to vote,
`the right to buy and sell property, the right to marry without parental consent, and the obligation
`to serve on a jury.
`21.
`The law incorporates the definition of “business” set forth in California Civil Code
`Section 1798.140(c), which, pursuant to a recent amendment effective January 1, 2023, reaches
`major enterprises that earn more than $25,000,000 in gross annual revenues, as well as small
`websites that buy, sell, or merely share information from as few as 100,000 visitors annually, or
`that obtain more than half their revenue from data monetization. Not-for-profit and governmental
`entities are excluded.
`22.
`Although AB 2273 purports to regulate “online service[s], product[s], or
`feature[s],” the statute in fact regulates speech. AB 2273’s references to “system design features,”
`“algorithms,” and “targeted advertising systems” all refer to the methods used to disseminate or
`circulate speech on the Internet. This fact is underscored by Section 1798.99.30(b)(5)(C), which
`
`
`5 AB 2273 California Assembly Floor Analysis (Aug. 22, 2022), available at https://leginfo.legislature.ca.gov/faces/
`billAnalysisClient.xhtml?bill_id=202120220AB2273#.
`
`5
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 7 of 40
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`clarifies that AB 2273’s reach excludes “the delivery or use of a physical product.”
`23.
`AB 2273 defines “likely to be accessed by children” to “mean[] it is reasonable to
`expect, based on the following indicators, that the online service, product, or feature would be
`accessed by children”:
`
`
`(A)
`
`The online service, product, or feature is directed to children as defined by
`the Children’s Online Privacy Protection Act (15 U.S.C. Sec. 6501 et seq.).
`The online service, product, or feature is determined, based on competent
`and reliable evidence regarding audience composition, to be routinely
`accessed by a significant number of children.
`(C) An online service, product, or feature with advertisements marketed to
`children.
`(D) An online service, product, or feature that is substantially similar or the
`same as an online service, product, or feature subject to subparagraph (B).
`An online service, product, or feature that has design elements that are
`known to be of interest to children, including, but not limited to, games,
`cartoons, music, and celebrities who appeal to children.
`A significant amount of the audience of the online service, product, or
`feature is determined, based on internal company research, to be children.
`§ 1798.99.30(b)(4).
`24.
`This definition is vague and potentially limitless, given that AB 2273 defines
`“children” as all individuals under 18. It is also content-based, as companies must look to the
`subject matter of their speech—for example, whether they host “advertisements marketed to
`children” or “cartoons, music and celebrities who appeal to children”—to understand whether they
`are within the scope of the law.
`25.
`As a practical matter, the law extends so widely as to sweep in the vast majority of
`companies operating online. The following services, for example, would likely qualify:
`
`
`(B)
`
`(E)
`
`(F)
`
`a.
`
`b.
`
`c.
`d.
`
`All major news outlets, including The New York Times, Wall Street
`Journal, and Washington Post; ABC, CBS, and NBC; CNN, Fox News, and
`MSNBC; as well as a significant number of local news services.
`The websites of every major sports league, including MLB, MLS, NBA,
`NFL, and NHL, and sports outlets serving the United States, including
`ESPN, FiveThirtyEight, the Golf Channel, NBC Sports, Sports Illustrated,
`Telemundo, and Yahoo Sports.
`Most online magazines and podcast channels.
`E-books and e-reader apps, as well as book forums.
`
`6
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
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`e.
`f.
`g.
`h.
`i.
`
`j.
`
`Online education and credential programs.
`Social media services.
`Video and music streaming services.
`Online video games.
`Individual blogs and discussion forums, such as those focused on news,
`economics, political science, ballet, fashion, cooking, chronic illness,
`physical fitness, mental health, sexuality, religion, history, video games,
`and countless other topics.
`Online self-help and suicide-prevention services that treat both adult and
`child populations.
`
`26.
`If the law is allowed to take effect, AB 2273 would impose impermissible burdens
`on an extraordinary range of covered businesses and could result in a fundamentally changed
`Internet.
`
`2.
`The law’s Data Protection Impact Assessments
`27.
`Section 1798.99.31(a)(1) of AB 2273 mandates that “[b]efore any new online
`services, products, or features are offered to the public,” a covered business must (i) complete a
`“Data Protection Impact Assessment” (DPIA) for “any online service, product, or feature likely to
`be accessed by children”; (ii) maintain documentation of the DPIA for as long as that service,
`product, or feature is likely to be accessed by children; and (iii) biennially review all its DPIAs. A
`service must complete a DPIA “on or before July 1, 2024, for any online service, product, or
`feature likely to be accessed by children offered to the public before July 1, 2024,” § 1798.99.33(a)
`(emphasis added)—that is, for all existing covered services, products, and features. Accordingly,
`online businesses must take significant steps now to plan for and implement eventual compliance
`with AB 2273, long before AB 2273’s purported effective date.
`28.
`Each DPIA must describe “the risks of material detriment to children that arise from
`the data management practices” related to that online product, service, or feature. It must also
`state whether the service, product, or feature “could” “harm” minors in various ways, such as by
`exposing them to “potentially harmful” content, contacts, and conduct; whether algorithms or
`“targeted advertising” “could harm children”; and whether and how the product, service, or feature
`“uses system design features to increase, sustain, or extend use of the online product, service, or
`feature by children, including the automatic playing of media, rewards for time spent, and
`
`7
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
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`notifications.” § 1798.99.31(a)(1)(B). In conjunction with the DPIA, the business must also
`“create a timed plan to mitigate or eliminate” any risks identified in the DPIA “before the online
`service, product, or feature is accessed by children.” § 1798.99.31(a)(2).
`29.
`The Act does not define the terms “material detriment,” “harm,” or “harmful.”
`Thus, the Attorney General apparently has discretion to deem any type of asserted harm—however
`the Attorney General defines “harm,” and notwithstanding that others might disagree—as
`constituting a “risk of material detriment” that must be documented. A business could be expected
`to document the risks, for example, that photographs and videos depicting the global effects of
`climate change, the war in Ukraine, school shootings, or atrocities in Syria could cause minors
`anxiety; or that a content recommendation for the next episode of a cartoon TV series could “harm”
`a minor who is struggling to focus on homework or to get more exercise.
`30.
`The possibility that the State might consider a particular piece of content or feature
`“harmful” to some or all minors, combined with the risk of having been found to violate the law
`due to an inadequate DPIA, will pressure businesses to identify distant or unlikely harms—and to
`self-censor accordingly.
`31.
`Under the Act, the California Attorney General may at any time order a covered
`entity to provide him with any DPIA that it has completed, or with a list of all DPIAs it has
`completed. §1798.99.31(a)(3)-(4).
`32.
`The DPIA requirement applies equally to large global services and single-person
`blogs, so long as they meet California’s definition of a “business.” As one independent journalist
`explained about his own publication: “Our comment system? DPIA. Our comment voting? DPIA.
`Our comment promotion? DPIA. The ability to listen to our podcast? DPIA. The ability to share
`our posts? DPIA. The ability to join our insider chat? DPIA. The ability to buy a t-shirt? DPIA.
`The ability to post our stories to Reddit, Twitter, Facebook, or LinkedIn? DPIA (for each of those,
`or can we combine them? I dunno). Our feature that recommends similar articles? DPIA. Search?
`DPIA. Subscribe to RSS? DPIA.”6
`
`6 Mike Masnick, “Dear California Law Makers: How The Hell Can I Comply With Your New Age-Appropriate
`Design Code,” TechDirt (Aug. 24, 2022), available at https://www.techdirt.com/2022/08/24/dear-california-law-
`makers-how-the-hell-can-i-comply-with-your-new-age-appropriate-design-code/.
`
`8
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`
`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
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`3.
`The statute’s age verification requirements
`33.
`Section 1798.99.31(a)(5) requires regulated businesses to “[e]stimate the age of
`child users with a reasonable level of certainty appropriate to the risks that arise from the data
`management practices of the business or apply the privacy and data protections afforded to children
`to all consumers.”
`34.
`The Act does not define “reasonable level of certainty appropriate to the risks.”
`Left in the dark, covered businesses must either configure the privacy settings for each of their
`offerings to their most speech- and content-restrictive levels for all users regardless of age, or
`attempt to verify the age of users with near certainty.
`35.
`But age certainty is not realistic. Age verification technologies are inherently
`unreliable.7 Most methods rely on users either to attest to their ages or to submit official documents
`verifying their ages.8 For users determined to bypass the rules, there are “straightforward
`workarounds” to both of these methods, which businesses often cannot avert.9 And any method
`that involves submitting official documents increases the risk that those documents could be stolen
`or leaked.10 More invasive age-verification methods—such as artificial intelligence, facial
`analysis, or facial recognition technologies—are far from foolproof and pose their own
`transparency, security, and privacy concerns.11 To the extent AB 2273’s “reasonable … certainty”
`standard effectively requires companies to adopt such invasive age-verification methods, the law
`likely conflicts with other states’ privacy laws—such as laws that regulate the collection of
`biometric data—and subjects online businesses to a patchwork of inconsistent obligations.
`Perversely, AB 2273 contradicts the consumer-data-minimization mandates of the State’s own
`privacy law, the California Privacy Rights Act (CPRA), and might well result in a net loss of
`
`7 French National Commission on Information and Liberties, “Online Age Verification: Balancing Privacy and the
`Protection of Minors” (Sept. 22, 2022) (concluding that age verification mandates are “inevitably imperfect” because
`they “can easily be circumvented,” noting that “23% of minors say they can bypass blocking measures”), available at
`https://tinyurl.com/yzv7ynem.
`8 Jackie Snow, “Why Age Verification Is So Difficult for Websites,” WALL ST. J. (Feb. 27, 2022), available at https://
`on.wsj.com/3R0ORMT.
`9 Id.
`10 Id.
`11 See David McCabe, “Anonymity No More? Age Checks Come to the Web,” N.Y. TIMES (Oct. 27, 2021), available
`at https://nyti.ms/3S6U2ME.
`
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 11 of 40
`
`privacy for California minors and adults alike.
`36.
`In practice, many online businesses are likely to respond to the law by offering to
`the public only what they predict the Attorney General will deem suitable for the youngest
`children. The resulting system of self-censorship will dramatically change the vibrant and
`egalitarian “modern public square” online. Packingham, 137 S. Ct. at 1737.
`
`4.
`
`The statute’s requirements for the display and enforcement of policies,
`terms, and standards
`37.
`Section 1798.99.31(a)(9) requires businesses to “[e]nforce published terms,
`policies, and community standards established by the business, including, but not limited to,
`privacy policies and those concerning children.”
`38.
`This far-reaching provision empowers the government to oversee and second-guess
`whether an online publisher has correctly enforced its own discretionary content moderation
`standards. Content moderation requires discretionary judgment about what speech to permit and
`whether content is, for example, racist, sexist, inflammatory, spiteful, threatening, or otherwise out
`of step with an online publisher’s values. Different businesses might reach different conclusions
`depending on the type of community they are trying to create. Federal law explicitly recognizes
`that such editorial judgment is both discretionary and cannot be regulated by the government. 47
`U.S.C. § 230(c)(2).
`39.
`Section 1798.99.31(a)(9) eliminates both this discretion as well as the element of
`private action by empowering the State to penalize any covered business that fails to adequately
`enforce its own editorial standards and policies. Permitting the State to monitor an online
`publisher’s content moderation decisions intrudes into the publisher’s right to make editorial
`decisions about the types of content to host or exclude in pursuit of its mission, and incentivizes
`publishers to forgo content moderation altogether—a dire prospect for content-sharing services,
`for which content moderation is the product they provide.12
`5.
`The statute’s prohibitions on use of information
`AB 2273 prohibits covered services from taking actions that are otherwise protected
`
`12 See, e.g., Caitlin Vogus, “Chilling Effects on Content Moderation Threaten Freedom of Expression for Everyone,”
`Center for Democracy & Technology (July 26, 2021), available at https://tinyurl.com/2p87nvv9.
`
`40.
`
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
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`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 12 of 40
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`by the Constitution or federal law.
`41.
`First, Section 1798.99.31(b)(1) forbids an online service from using “the personal
`information of any child in a way that the business knows, or has reason to know, is materially
`detrimental to the physical health, mental health, or well-being of a child.” Under this rule, an
`online business must guess what constitutes a use that is “materially detrimental” to the mental or
`physical health—or to the even more amorphous concept of the “well-being”—of a child or teen.
`42.
`Second, Section 1798.99.31(b)(3) bars a business from collecting, selling, sharing,
`or retaining “any personal information that is not necessary to provide an online service, product,
`or feature with which a child is actively and knowingly engaged,” unless “the business can
`demonstrate a compelling reason that the collecting, selling, sharing, or retaining of the personal
`information is in the best interests of children likely to access the online service, product, or
`feature.” The law does not define or delimit what might constitute “the best interests of children”
`or what might constitute a “compelling reason” for the use of information.
`43.
`Third, if the “end user is a child,” Section 1798.99.31(b)(4) precludes a business
`from using “personal information for any reason other than a reason for which that personal
`information was collected, unless the business can demonstrate a compelling reason that use of the
`personal information is in the best interests of children.” This requirement too is plagued by
`generalities and undefined terms.
`44.
`Beyond vague mandates and undefined purposes, these provisions on their face
`disallow a range of commonplace online speech, including engaging with users to learn their
`preferences; using collected
`information for personalized advertising; providing users
`recommendations about books, movies, newspaper articles and other content; or even sending
`automated email updates to users.
`45.
`Guessing wrong about what these provisions proscribe is prohibitively expensive—
`penalties for even negligent errors could exceed $20 billion. Many services will not or cannot risk
`it. Instead, they will self-censor by banning users whose age they cannot verify; refrain from
`publishing content to certain users; disable editorial features that control the publication, curation,
`and promotion of content on their services; forego efforts to connect their customers with
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`11
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`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`
`DAVIS WRIGHT TREMAINE LLP
`865 S. FIGUEROA ST, SUITE 2400
`LOS ANGELES, CALIFORNIA 90017-2566
`(213) 633-6800
`Fax: (213) 633-6899
`
`
`
`

`

`
`
`Case 5:22-cv-08861-VKD Document 1 Filed 12/14/22 Page 13 of 40
`
`suggested content or other users; or shut down altogether. The law poses an existential risk in
`particular to websites that rely on advertising to support dissemination of speech to and among
`users.
`
`6.
`The statute’s ban on using “dark patterns”
`46.
`Section 1798.99.31(b)(7) prevents a business from “us[ing] dark patterns to lead or
`encourage children to,” among other things, “take any action that the business knows, or has rea

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