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Privacy bill markup canceled amid multi-front opposition

Updated version of data privacy bill draws fire from tech industry, civil rights groups

House Energy and Commerce Chair Cathy McMorris Rodgers, R-Wash., center, and ranking member Rep. Frank Pallone Jr., D-N.J., right, are shown at a hearing on the social media platform TikTok in March 2023.
House Energy and Commerce Chair Cathy McMorris Rodgers, R-Wash., center, and ranking member Rep. Frank Pallone Jr., D-N.J., right, are shown at a hearing on the social media platform TikTok in March 2023. (Tom Williams/CQ Roll Call)

The House Energy and Commerce Committee on Thursday abruptly canceled the scheduled markup of a federal data privacy bill along with several other measures in the face of a torrent of opposition to the privacy measure from the tech industry and civil rights organizations.

Opponents of the measure have called on committee Chair Cathy McMorris Rodgers, R-Wash., and the top Democrat, New Jersey Rep. Frank Pallone Jr., to postpone the markup since the two lawmakers unveiled a modified version of an earlier draft legislation that was advanced by a subcommittee in May.

The updated version released on June 21 struck key provisions that would have prohibited companies from collecting, processing or retaining data on users that results in discrimination on the basis of race, sex, religion and other categories. It also cut a section on consumers’ right to opt out of algorithmic decisions, including for housing, health care and credit. Companies would’ve been required to offer users the opportunity to opt out under the earlier draft.

Close to 50 civil rights groups led by the Leadership Conference on Civil and Human Rights called on Rodgers and Pallone to postpone the markup because the latest version removed “key civil rights protections and algorithmic auditing provisions” that were included in the previous version.

Provisions that were retained, however, have been strongly opposed by the tech industry. Those include allowing individuals to sue tech companies for privacy violations and allowing stricter state privacy laws to remain in effect. TechNet, a trade industry group whose members include Amazon, Apple, Google, Etsy and others, wrote to Rodgers and Pallone on Wednesday, urging them to cut those provisions. On the other side, a group of state attorneys general led by California Attorney General Rob Bonta have pressed lawmakers to allow states to set standards over and above federal law.

Rodgers, who’s retiring from Congress at the end of her term, issued a statement that didn’t explain why the markup was canceled but noted that the “American people are exhausted, anxious, and losing hope with the status quo.”

Pallone blamed House Republican leadership for the cancellation.

“It’s outrageous that Republican Leadership would interfere with the Committee’s bipartisan regular order process,” he said in a statement.

One tech industry lobbyist, who spoke anonymously, said House Speaker Mike Johnson and Majority Leader Steve Scalise, R-La., opposed the data privacy measure because it doesn’t supersede state laws and retains provisions allowing private lawsuits.

Spokespersons for Rodgers and Pallone declined to offer any additional details.

The cancellation lessens the likelihood that Congress will enact a federal privacy law in the current session. The latest attempt at a bipartisan privacy bill emerged in April after Rodgers and Senate Commerce Chair Maria Cantwell, D-Wash., announced they had reached agreement on the broad outlines of legislation.

In the absence of a federal privacy law, 18 states have enacted privacy laws and more state legislatures are considering legislation.

The committee also canceled the markup of a kids online privacy bill, a measure relating to the transplanting of human cell and tissue, a telehealth modernization bill and resolutions relating to greenhouse gas emissions and pollutants.

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