Understanding the Rise of Abusive CIPA Lawsuits in California
At Preovolos Lewin, ALC, we stay at the forefront of evolving legal threats impacting businesses across San Diego and beyond. A concerning trend gaining traction is the surge in abusive CIPA (California Invasion of Privacy Act) lawsuits, targeting everyday website functions. Here’s what businesses must know to stay protected.
What Is the California Invasion of Privacy Act (CIPA)?
Originally enacted to prevent eavesdropping and unauthorized recording of telephone and electronic communications, CIPA has recently been weaponized against standard website features. Plaintiffs now argue that using tools like session replay software, chat widgets, and analytics scripts—which capture mouse clicks, page views, or chat interactions—violates Penal Code § 631.
Even though multiple federal courts have ruled that such claims fall outside CIPA’s intended scope, businesses continue to face costly demand letters and litigation threats.
Who Are the Primary Targets of CIPA Lawsuits?
Small-to-mid-sized e-commerce retailers, telehealth platforms, and professional services firms are the main targets. The lawsuits allege that recording actions like:
- Keystrokes
- IP addresses
- Chat conversation snippets
without explicit consent breaches California’s one-party consent rule.
Courts have observed that analytics data typically does not constitute protected “content.” However, the threat of statutory damages and attorney’s fees often pressures businesses into costly settlements.
Best Practices to Minimize CIPA Litigation Risk
Businesses can take proactive steps to reduce exposure to abusive CIPA lawsuits:
1. Audit Your Digital Tools
Carefully review all scripts, SDKs, and plugins that collect user data. Pay special attention to third-party session replay and chatbot vendors.
2. Implement Clear Opt-In Consent Banners
Use transparent banners that require affirmative user consent for any non-essential tracking or recording features.
3. Revise Your Privacy Policy
Fully disclose the types of data collected, the vendors involved, and provide users with options to opt out or request data deletion.
4. Strengthen Third-Party Vendor Contracts
Ensure your vendor agreements include privacy-compliance warranties and indemnification provisions to shift some liability.
5. Train Your Internal Teams
Educate developers, marketers, and customer service representatives about CIPA compliance and internal privacy protocols.
Proactively adopting these strategies can substantially reduce the risk of being targeted by opportunistic lawsuits.
How Senate Bill 690 (SB 690) Could Change the Landscape
Recognizing the flood of predatory lawsuits, Senator Anna M. Caballero introduced SB 690 on February 21, 2025. This proposed bill aims to amend key CIPA statutes—Penal Code §§ 631, 632, 632.7, 637.2, and 638.50—by:
- Creating an explicit exemption for data processing performed for “commercial business purposes.”
- Excluding activities covered by California Consumer Privacy Act (CCPA) opt-out rights from CIPA liability.
If passed, SB 690 would protect businesses using standard website analytics, session replay tools, and chatbot interactions—provided these practices are properly disclosed.
What Is the Outlook for SB 690?
SB 690 is currently pending before the Senate Public Safety Committee, with a hearing scheduled for April 29, 2025.
Supporters, including the E-commerce Innovation Alliance, argue that SB 690 strikes a necessary balance between protecting consumer privacy and enabling legitimate business practices. Meanwhile, privacy advocates express concern that the bill could weaken important CIPA protections.
Given the bill’s Democratic sponsorship and strong economic backing, there is a reasonable chance SB 690 could advance—but success will depend on negotiations, amendments, and ultimate approval by both the Senate and Assembly.
If in need of additional information or clarification, please contact us for guidance
Abusive CIPA lawsuits present a growing threat to businesses of all sizes. Staying ahead of compliance standards—and monitoring legislative developments like SB 690—is crucial. If your business has received a CIPA demand letter or needs guidance on risk reduction, the experienced attorneys at Preovolos Lewin, ALC are here to help.