Two customers shopping for the same product on the same website at the same time may see two different prices.  This scenario is a growing reality in today’s data-driven marketplace, and California regulators are paying attention.  On Data Privacy Day 2026, California Attorney General Rob Bonta announced a new investigative sweep targeting “surveillance pricing”—a practice in which businesses use personal information to set individualized prices for consumers.  For online retailers and service providers, this probe raises important questions about how customer data is collected, used, and disclosed.

The California Consumer Privacy Act secures several key privacy rights for California consumers, including:

  • The right to know about the personal information a business collects about them and how it is used and shared;
  • The right to delete personal information collected from them (with some exceptions);
  • The right to opt-out of the sale or sharing of their personal information, including via the Global Privacy Control (GPC); and
  • The right to non-discrimination for exercising their CCPA rights.

Of particular relevance to pricing practices, the CCPA includes a “purpose limitation” that restricts how businesses can use personal information.  Under this principle, businesses are limited in their use of personal information to purposes that are consistent with the reasonable expectations of consumers.  Businesses must disclose in their privacy policies how they collect, use, share, and sell consumers’ personal information, and these policies must include information on consumers’ privacy rights and how to exercise them.

A Track Record of Active Enforcement Under the CCPA

      This enforcement of CCPA actions is not new to Attorney General Bonta.  He has consistently demonstrated commitment to robust enforcement of California’s privacy law and has targeted a range of data practices.  In July 2025, the Attorney General announced the largest CCPA settlement to date resolving allegations that a company’s use of online tracking technology on its website violated the CCPA.  In 2024, the CCPA investigative sweep focused on compliance by streaming services and connected TVs.  In August 2022, the Attorney General announced a settlement resolving a sweep of companies that were allegedly out of compliance with the user-enabled privacy control (GPC) signal to stop the sale of personal information.  Other sweeps have addressed the location data industry, employee information, opt-out requests on mobile apps, and business loyalty programs.

      What Is Surveillance Pricing?

      In plain terms, “surveillance pricing” is the use of consumers’ personal information to set targeted, individualized prices for products and services.  

      This can result in different consumers being offered different prices for the same product at the same time, often without any disclosure to the consumer.  Unless a business discloses that it uses a consumer’s personal information to set prices, surveillance pricing may be invisible to the consumer.

      What Businesses Are Being Asked to Disclose

      The California AG’s inquiry letters seek detailed information on businesses’ data-driven pricing practices, including:

      • Companies’ use of consumer personal information to set prices;
      • Policies and public disclosures regarding personalized pricing;
      • Any pricing experiments undertaken by companies;
      • Measures companies are taking to comply with algorithmic pricing, competition, and civil rights laws.

      Attorney General Bonta emphasized that practices like surveillance pricing “may undermine consumer trust, unfairly raise prices, and when conducted without proper disclosure or beyond reasonable expectations, may violate California law.”  Similar enforcement has been implemented by the Federal Trade Commission and New York.  

      Although the current sweep is centered on surveillance pricing in retail, grocery, and hospitality, the California AG’s public statements make clear that enforcement is driven by the nature of the data use, not the sector.  The CCPA’s purpose-limitation and reasonable-expectations principles have been construed to apply broadly, and other uses of personal information that significantly influence economic terms for consumers could come under scrutiny.

      Legal Risks Under the CCPA Key Considerations for Businesses

      Businesses that may use data to set individualized prices, directly or indirectly, should consider the following:

      • Review data use practices: Assess whether consumer personal information is used for pricing decisions and whether such use is disclosed in a manner consistent with CCPA requirements.
      • Update privacy disclosures: Ensure privacy policies accurately reflect pricing practices and purposes for data collection.
      • Assess reasonable expectations: Consider whether targeted pricing strategies align with what consumers would reasonably expect based on the business’s relationship with them.
      • Prepare for enforcement: If contacted by the California AG’s office, respond promptly and ensure records, data mapping, and compliance documentation are up to date.

      The California AG’s surveillance pricing probe marks a significant development in privacy enforcement.  Privacy enforcement is no longer just about data collection and sharing; it is now about how businesses use consumer data to influence prices.  As Attorney General Bonta stated, “Consumers have the right to understand how their personal information is being used, including whether companies are using their data to set the prices that Californians pay.”  Businesses would be well advised to review their data practices now and ensure that privacy disclosures and pricing strategies are aligned with California’s evolving regulatory expectations.

      A sharp contrast in the speed of obtaining appellate review is emerging between two key privacy statutes. While the U.S. Supreme Court is set to resolve a circuit split over the Video Privacy Protection Act (VPPA), litigants grappling with the California Invasion of Privacy Act (CIPA)—a statute one federal judge recently described as a “total mess”—still await interpretative guidance from even a single appellate court.

      Some predicted that appellate review of CIPA might be coming soon, based on a motion for interlocutory appeal that was recently filed in Fregosa v. Mashable, Inc. However, on January 23, 2026, the district court denied the request. At issue in that case was the interpretation of CIPA’s “pen register” provision and whether it applied to website tracking technologies. Citing a handful of federal district courts that had adopted similar interpretations of CIPA, the court found there were no “substantial grounds for difference of opinion” to justify an appeal—despite the growing number of state courts that have adopted a conflicting interpretation of CIPA.

      By contrast, trial courts in VPPA cases have seemed more open to allowing appellate review of ambiguities within the statute. The United States Supreme Court will hear Salazar v. Paramount Global to decide who qualifies as a “consumer” after federal circuits split 2-2 on the issue. At stake in Salazar is whether the VPPA applies narrowly to subscribers of “audiovisual materials” or broadly to all of a company’s subscribers.

      With CIPA’s interpretation in flux and a landmark VPPA decision pending, the legal landscape for website tracking is volatile. Businesses must stay informed and proactively manage compliance risk. Follow for updates on these critical developments.

      #PrivacyLaw #VPPA #CIPA #SCOTUS

      On February 5, 2026, Florida Attorney General James Uthmeier announced the creation of a first-of-its-kind specialized civil and criminal unit, named Consumer Harm from International and Nefarious Actors or “CHINA” for short. The unit will be dedicated to investigating and prosecuting foreign corporations, particularly those with Chinese ownership, that collect consumer data from Florida residents.

      The new division, housed within the Florida Attorney General’s Office will leverage state consumer protection laws to pursue subpoenas, investigations, and lawsuits against companies whose data practices may expose Floridians to foreign adversaries. The AG’s office made clear that health care companies, especially those collecting biometric and demographic data, will be a top enforcement priority.

      For companies operating in the health tech, biometrics, or consumer data space, Florida’s new enforcement unit warrants close attention. Businesses with any foreign ownership, particularly ties to China, should review their data collection, transmission, and disclosure practices. Transparency with consumers about international data flows may become not just a best practice but an enforcement flashpoint. If other states follow Florida’s lead, companies could soon face a patchwork of aggressive state-level scrutiny layered on top of existing federal oversight.

      China’s internet regulatory authority and top prosecutors have recently released a series of enforcement actions and cases, aimed at highlighting enforcement priorities in the data security realm over the last year. In 2025, enforcements under the Chinese Cybersecurity Law, the Data Security Law, the Personal Information Protection Law, and the Regulations on the Security Management of Network Data, focused primary on data security compliance, illegal cross-border transfers, and violations of personal information rights.

      Companies were cited for violations related to over-collection of data, noncompliance with network data security rules, improper storage, allowing unrestricted access to sensitive information, and violating consent requirements.

      Chinese authorities have stated that enforcement priorities in 2026 will include increased oversight in the “digital sphere” including activities of illegal collection and misuse of personal data. Enforcement actions in 2026 are also expected to focus on data leaks and improper network governance and increased penalties for data breaches.

      To prevent being the focus of China’s regulatory authority, companies should focus on:

      • Ensuring adequate safeguards are in place to protect data in transit and at rest;
      • Completing required cybersecurity classification and grading, where required;
      • Implementing effective security management policies and access policies, including strong password requirements;
      • Completing necessary assessments or certifications where required for cross-border transfers; and
      • Publishing adequate notices disclosing personal information collection and processing practices, and do not exceed those disclosed practices.

      While specific compliance requirements will vary depending on the business, any data collection, storage, or processing occurring in China will be subject to increased scrutiny in 2026, requiring businesses to take a closer look to ensure proper data security is in place.

      Importantly, although the safeguards may have overlap across different international laws and standards, cross-border transfer and localization principles are causing harder operational issues for businesses. With enforcement ramping up, businesses should carefully consider their global compliance strategy.

      Navigating the 2026 CCPA Updates

      As forecasted, effective January 1, 2026, businesses that are subject to the California Consumer Privacy Act (CCPA) must comply with newly-updated regulations. For some businesses, complying with these updates will require the implementation of or updates to policies and procedures related to, among other things, risk assessments, cybersecurity audits, and the use of Automated Decision-Making Technologies. Businesses should review the updated regulations to determine if they might be affected and, if so, implement a plan to promptly ensure compliance.

      Outlined below are just a few of the most notable CCPA updates businesses should be aware of:

      1. Risk Assessments
        • Businesses who engage in certain processing activities, including selling or sharing personal information, will need to conduct risk assessments. For new processing activities (beginning after January 1, 2026), risk assessments must be conducted prior to commencement of the new activity. Businesses that conduct a risk assessment in the prior calendar year must submit an attestation of the risk assessment to the California Privacy Protection Agency (“Agency”) by April 1 of the following year.
        • For activity that occurred prior to January 1, 2026, and continued thereafter, businesses must conduct a risk assessment by December 31, 2027, and provide attestation on or before April 1, 2028.
        • Risk assessments completed for other state laws can demonstrate compliance if they check the boxes of CCPA’s regulations as well.
      2. Automated Decision-Making Technology (ADMT) Rules
        • The updated regulations impose new requirements for businesses that use ADMT to make “significant decisions” about consumers. Those requirements will take effect in 2027. “Significant decisions” include granting or denying services like financial or lending products, housing, educational admissions or opportunities, job or contracting opportunities and compensation, or healthcare services.
        • Obligations associated with ADMT use include:
          • Providing consumers with pre-use notice of and access to information describing the manner in which ADMT is used and informing them of their associated opt-out and access rights;
          • Offering consumers ADMT opt-out, unless an exception applies;
          • Conducting risk assessments, as applicable; and
          • Updating privacy notices, as applicable.
      3. Cybersecurity Audits
        • The CCPA regulations will require certain businesses to conduct mandatory cybersecurity audits. The scope of the audits contains a long list of specifics, which generally tracks established audit standards such as the NIST Cybersecurity Framework. Businesses will also have to submit annual certifications of completion to the Agency.
        • While the deadlines for submitting certifications begin in 2028, businesses should be aware that implementing compliant cybersecurity programs—which often must include, among other things, incident response management, access controls, data inventory, retention and disposal procedures, and vendor oversight—often requires collaboration across businesses and can be very time consuming.
      4. Broadened Definition of “Sensitive Personal Information”
        • The updates also imported the statutory definition of “sensitive personal information,” with the addition of “personal information collected and analyzed concerning a consumer’s health, sex life, or sexual orientation,” and “personal information of consumers that the business has actual knowledge [or willfully disregards] are less than 16 years of age.”
        • With the broadened definition, businesses should reassess their need for notices, opt-outs, and back-end procedures related to the Right to Limit.
      5. Other Notable Updates
        • Stricter requirements relating to the use of dark patterns, highlighting the need for careful consideration relating to cookie banners and opt-out menus;
        • Additional notice requirements for businesses that disclose personal information collected through augmented or virtual reality devices;
        • Updates to data subject rights procedures; and
        • New transparency requirements, including in-app privacy policy posting requirement.

      Although many of the deadlines outlined above seem distant, businesses should be auditing their current processing activities for compliance now rather than discovering potential issues right before the applicable deadlines expire.

      The past year set up a clear clash between federal deregulatory efforts and state-level AI rulemaking, and 2026 is poised to be the year that conflict materializes in earnest.  The Trump Administration signaled a strong preference for scaling back AI-specific rules while exploring avenues to preempt state and local measures, even as a growing number of states moved forward with their own frameworks. In short, 2025 laid the groundwork, and 2026 is likely to deliver the confrontation.

      On the federal side, the Administration’s posture included both legislative and policy initiatives aimed at limiting state restrictions on AI.  Although a proposed 10-year moratorium on enforcing state AI laws was removed during negotiations over the One Big Beautiful Bill Act, the America’s AI Action Plan soon followed, instructing agencies to consider using preemption to curb “burdensome” state AI regulations. In the final weeks of 2025, the White House issued an executive order, Ensuring a National Policy Framework for Artificial Intelligence (the “Executive Oder”). The Executive Orderdirects the U.S. Attorney General to establish an AI Litigation Task to challenge state AI laws deemed unconstitutional or preempted and tasks the Administration with developing a national AI legislative framework that would preempt conflicting state rules.

      States, however, did not stand still.  California’s SB 53 established a first-in-the-nation set of standardized safety disclosure and governance obligations for developers of frontier AI systems, underscoring state willingness to regulate despite federal headwinds. Colorado’s Anti-Discrimination in AI Law remained intact through the 2025 session and is scheduled to take effect in June 2026, setting a near-term compliance deadline that will shape risk assessments and product planning.  Even traditionally deregulatory states like Texas pursued aggressive enforcement under existing biometric laws against alleged AI-driven facial recognition practices.

      Looking ahead, expect 2026 to feature litigation over the scope of preemption, increased enforcement actions from federal agencies, and a push toward a federal legislative framework, alongside continued state innovation in AI governance.  Despite the uncertainty, companies should continue to comply with applicable state AI laws because the Executive Order itself cannot overturn state law. Only Congress and the courts have the power to do so, and until then, state laws remain enforceable. For companies, that means preparing for a two-track reality: monitor and implement state obligations while tracking federal moves that could reshape, narrow, or delay those obligations. The result is likely to be a dynamic, contested compliance environment throughout 2026, rather than quick regulatory convergence.

      Over the last few years, businesses, nonprofits, and other website operators have seen thousands of lawsuits and arbitrations filed under the California Invasion of Privacy Act (CIPA) alleging that the use of ubiquitous cookies and pixels on websites violates CIPA’s wiretap and pen register provisions. The California legislature considered curbing that explosion of litigation with SB 690, which was introduced in the 2025 session with some enthusiasm but ultimately stalled.

      Thus, although there is some hope of relief as the legislative session picks back up in 2026, organizations are left in the same situation as before—balancing business needs and value with risk mitigation.

      SB 690 at a Glance

      CIPA was originally enacted in 1967 to address traditional wiretapping and eavesdropping concerns which, at the time, primarily involved telephonic communications. It therefore did not address digital technologies or adtech now used for website marketing. Nonetheless, in recent years, several thousands of lawsuits and arbitrations have sought to apply CIPA in precisely that context.  

      In 2025, California lawmakers advanced SB 690 to modernize CIPA for the internet era. The amendment aims to tamp down lawsuits targeting routine website technologies by adding a broad “commercial business purpose” exemption to CIPA’s wiretap and pen-register provisions and, thus, clarify that use of these technologies for business purposes would not trigger CIPA liability. Early versions of the bill included a retroactivity provision that would have applied to all pending cases as of January 1, 2026, but that provision was removed in the Senate amid criticism from consumer advocate groups.

      Why SB 690 Stalled in 2025

      Despite unanimous passage in the Senate, SB 690 did not clear the Assembly before the 2025 legislative session adjourned, and it was thus designated a two-year bill. Reports indicate the bill stalled in the Assembly Judiciary process, with lawmakers citing the need for further stakeholder dialogue and competing policy priorities, leaving businesses to face continued litigation through at least 2026.

      The primary resistance to the bill came from privacy and consumer groups who argued that SB 690’s proposed exemption was too broad and would shield opaque tracking practices that CCPA enforcement has not yet addressed. Removal of the bill’s retroactivity provision would reduce immediate litigation relief, and plaintiffs’ filings continued apace through the close of the year amid split trial court decisions on CIPA’s scope.

      What’s Next for SB 690 in 2026

      Notably, it was SB 690’s author and primary sponsor that paused the bill in the Assembly in 2025, citing opposition from consumer privacy advocates and attorneys’ groups. So, it remains to be seen whether SB 690 will advance at all, at least in its current form, in 2026.

      SB 690 is eligible for reconsideration as a two-year bill in the 2026 session, which reconvenes January 5. The last day to introduce bills is February 20, and the final day to pass bills August 31. Expect policy committee activity in spring, fiscal deadlines in May, and floor-only periods late May and in the final August push. If revived, SB 690 is likely to remain prospective only, reinforcing the importance of near-term compliance and risk mitigation for existing site technologies.

      What Businesses and Organizations Should Do Now

      Until reform is enacted, CIPA suits over pixels, analytics, chatbots, search bar functions, and replay tools will continue, complete with statutory damages of $5,000 per alleged violation and inconsistent early-dismissal outcomes. Further, even if SB 690 eventually passes in its current form, relief would not be coming until at least 2027, if not longer. Organizations therefore need to take steps now to assess their risk.

      Risk mitigation for each specific organization will necessarily vary, but it will generally involve assessing practices, identifying any higher risk processing activities, and updating disclosures, consents, and vendor governance as appropriate.

      On December 19, 2025, New York Governor Kathy Hochul vetoed the New York Health Information Privacy Act (NY HIPA), a health data privacy bill that would have afforded consumer protections to non-HIPAA health data.

      Although NY HIPA resembled existing laws, like Washington’s My Health My Data Act, it had several important differences that would have greatly expanded its impact—including by applying to employee data, data held by financial institutions subject to the Gramm-Leach-Bliley Act, and data that had been de-identified in accordance with HIPAA. NY HIPA would have also required regulated entities to maintain a publicly available retention schedule and dispose of an individual’s regulated health information pursuant to that schedule subject to certain regulatory requirements.

      Unsurprisingly, NY HIPA was the subject of intense lobbying on both sides of the debate. Ultimately, Governor Hochul stated in her veto memo that the legislation, as written, is too broad, “creating potentially significant uncertainty about the information subject to regulation and compliance challenges.”

      NY HIPA could still technically pass into law if two-thirds of the members of each house vote to override the Governor’s veto. While NY HIPA did originally pass with that level of support, the likelihood of overriding a veto is very slim from a historical standpoint.

      In many ways, 2025 was a relatively tame year for privacy legislation, and the NY HIPA veto is a fitting conclusion. As we move into 2026, companies should carefully monitor whether states push more aggressively, as well as the emerging fight between the states and federal government over the authority to regulate AI and privacy issues.

      On October 13, 2025, California Governor Gavin Newsom vetoed S.B. 7, which would have required human oversight in certain types of employment decisions made solely by automated decision systems (“ADS”).  If Gov. Newsom signed the bill, it would have required California employers using automated systems for actions such as hiring, firing, and discipling to implement human oversight and explain certain decisions made by AI. The bill would have also required robust notices and granted employees and contractors access rights to data used by ADS.

      In his letter notifying the California State Senate of the veto Gov. Newsom cited concerns that S.B. 7 would have imposed “overly broad restrictions” on employer deployment of ADS. For example, the requirements could be interpreted to extend to “innocuous” technology such as scheduling and workflow management tools. Industry groups opposing the bill argued it would have also carried massive costs for compliance, particularly to small businesses.

      Gov. Newsom shared concerns with the bill’s author of unregulated use of ADS and affording employees protection as it relates to ADS, but wrote that legislatures “should assess the efficacy of [such] regulations to address these concerns.” Still, California employers face restrictions with respect to certain uses of ADS under the regulations recently finalized by the California Privacy Protection Agency.

      On September 30, 2025, the California Privacy Protection Agency (CPPA) issued a $1.35 million fine, the largest in the CPPA’s history, against Tractor Supply Company, the nation’s largest rural lifestyle retailer. The fine was issued based on allegations that the company violated its obligations under the California Consumer Privacy Act (CCPA). The CPPA coined its decision against Tractor Supply as “the first to address the importance of CCPA privacy notices and privacy rights of job applicants.”

      Below, we have provided additional information on the CPPA’s decision and the key takeaways for businesses subject to the CCPA in light of the decision.

      Background

      The CPPA first opened an investigation into the Tractor Supply after it received a complaint from a consumer in Placerville, California. Based on its investigation, the CPPA alleged Tractor Supply:

      • Failed to maintain an adequate privacy policy notifying consumers of their rights;
      • Failed to notify California job applicants of their privacy rights and how to exercise them;
      • Failed to provide consumers with an effective mechanism to opt-out of the selling and sharing of their personal information, including through opt-out preference signals such as the Global Privacy Control; and
      • Disclosed personal information to other companies without the entering into contracts that contain the requisite privacy protections.

      In addition to issuing the record $1.35 million penalty for these violations, the CPPA has also required Tractor Supply to implement broad remedial measures, which include, but are not limited to, the following:

      • Updating its privacy notices and notifying employees and job applicants of the updated notices;
      • Modifying the methods it provides consumers to submit requests to opt-out of targeted advertising;
      • Ensuring all required contractual terms are in place with all external recipients of personal information;
      • Recognizing opt-out preferences signals like the Global Privacy Control;
      • Regularly auditing its tracking technologies; and
      • Designating a compliance officer to certify adherence to its compliance for the next four (4) years.

      Key Takeaways

      This decision underscores several practical points for businesses subject to the CCPA:

      • Employees and job applicants are treated like consumers under the CCPA, so businesses should ensure their CCPA compliance programs adequately cover California workforce members and applicants;
      • A single consumer complaint can trigger a broad investigation; and
      • Investigations from the CPPA may not only result in remediation, but also significant monetary penalties.