• California Assembly Weighs Nation’s Broadest AI-Driven Workplace Surveillance Bill: AB 1221 Raises the Bar, and the Stakes, for Employers

    By Mari Clifford and Scott Hall 

    In a move that could reshape day-to-day people-management practices across the state, the California Legislature is advancing Assembly Bill 1221 (“AB 1221”), a sweeping proposal that would regulate how employers deploy artificial intelligence-enabled monitoring tools and how they handle the torrents of data those tools generate. After clearing two policy committees, the measure was placed on the Assembly Appropriations Committee’s “suspense” file on May 14, 2025: a key fiscal hurdle to a possible floor vote. AB 1221’s fiscal impact will be scrutinized in the Appropriations Committee, and the bill could still be amended; perhaps to narrow its scope or clarify open questions such as what constitutes a “significant update” to an existing tool. Nonetheless, the measure enjoys strong labor support and dovetails with California’s broader push to regulate AI. Even if AB 1221 stalls, its core concepts are likely to resurface.

    What AB 1221 Would Require

    The bill defines a “workplace surveillance tool” broadly to include virtually any technology that actively or passively captures worker data, from innocuous time-tracking widgets to sophisticated photo-optical systems. It would obligate employers (public and private, large and small, as well as their labor-contractor intermediaries) to furnish plain-language written notice at least thirty days before launching any such tool. That notice must spell out the categories of data collected, the business purpose, the frequency and duration of monitoring, retention periods, vendor identities, the extent to which the data informs employment decisions, and the process by which workers may access or correct that data.

    Once a surveillance system is up and running, it may collect, use, and retain information that is “reasonably necessary and proportionate” to the purpose identified in the notice, and employers bear joint liability for security breaches involving worker data. Contracts with analytics providers therefore must incorporate robust cybersecurity safeguards, cooperation duties and deletion obligations. Vendors must return worker data “in a user-friendly format” at contract end and delete remaining copies.

    AB 1221 would prohibit facial recognition, gait analysis, emotion detection and neural-data collection, but with one narrow carve-out: facial recognition may still be used solely to unlock a device or grant access to a locked or secured area. The bill also bars employers from using surveillance to infer protected traits such as immigration status, health or reproductive history, religion, sexual orientation, disability, criminal record or credit history.

    Employers may not rely primarily on monitoring data when disciplining or terminating a worker. If they choose to factor that data into such a decision, a human reviewer must corroborate it. The employer must notify the worker of the decision, provide a simple request form, and give the worker five business days to ask for the surveillance and corroborating records. Any valid correction must be made, and the personnel action adjusted, within twenty-four hours. Records that play any role in discipline must be retained for five years.

    Enforcement Mechanisms and Civil Exposure

    AB 1221 would vest enforcement authority in the Labor Commissioner, impose civil penalties of $500 per violation, and create a private right of action that includes actual and punitive damages as well as attorneys’ fees and punitive damages. Public prosecutors could also bring suit, and plaintiffs could seek injunctive relief, heightening litigation leverage for worker-side counsel.

    Points of Contention and Legislative Headwinds

    Industry groups, including the California chapter of SHRM, have criticized the proposal’s breadth, warning that it could hamper legitimate safety and operational uses of technology and saddle businesses with ambiguous compliance obligations. Labor advocates counter that AB 1221 supplies essential guardrails against what they describe as an exploding “digital Taylorism” that erodes privacy and exacerbates bias.

    Practical Implications for Employers

    If enacted, the bill would force employers to inventory every monitoring technology—no matter how routine—and to recalibrate vendor contracts, internal policies and disciplinary protocols. Multistate employers that already comply with New York City’s automated-employment-decision rules or the EU’s AI Act would confront new obligations around thirty-day advance notice, categorical technology bans and accelerated employee-data-access timelines. Because the measure’s private right of action is untethered to data-breach harm, plaintiffs’ lawyers would gain a fresh litigation hook wherever monitoring intersects with hiring, promotion or termination decisions.

    Takeaways

    Employers should begin mapping every data stream generated by workplace technologies, updating privacy notices and embedding human review into any algorithmically informed employment decision. Whether AB 1221 becomes law this session or next, the legislative trajectory is clear: AI-powered surveillance is migrating from operational convenience to regulated activity, and businesses that fail to get ahead of these requirements risk both regulatory penalties and private lawsuits.

     

  • There’s Always This Year? 2025 Legislature Considers CEQA Reforms to Spur Housing

    California’s 2025 legislative cycle includes another ambitious package of housing bills as the state continues to look for ways to ease the housing crisis amidst continued political and economic uncertainty. Reforming the California Environmental Quality Act (“CEQA”) is a perennial focus among developers and housing advocates, although the state has enacted only narrowly targeted measures in recent years to streamline certain types of projects. Two pieces of pending legislation—Senate Bill 607 and Assembly Bill 609—take a bigger swing at CEQA in ways that could have a meaningful impact on the long-stated goal of reducing redundant environmental review for infill housing and other projects, largely by expanding exemptions and making negative declarations and mitigated negative declarations (“MNDs”) more defensible.

    Overview of SB 607

    Senator Scott Wiener introduced this bill, the “Fast and Focused CEQA Act,” as a good government measure that would create opportunities for more streamlined environmental review through common sense amendments. Although these provisions are not limited to housing projects, none would apply to projects involving distribution centers, oil and gas infrastructure, or those located on “natural and protected lands.” Key provisions include:

    • Targeted Review for “Nearly” Exempt Projects: For projects that fail to qualify for a categorical or statutory exemption due to a single “condition,” the bill creates a new CEQA review process that limits CEQA review to the environmental effects caused by that single condition. It is not unusual for a project to barely miss qualifying for an exemption, so this creates a new, narrowly tailored CEQA process. This option is not available if a project does not qualify due to two “conditions.”
    • Replacement of the “Fair Argument” Standard: Courts have interpreted CEQA in a way that favors preparation of a full Environmental Impact Report (“EIR”) by applying what is called the “fair argument” standard of review to negative declarations and MNDs. This standard of review sets a relatively low bar to challenge MNDs in court, often causing lead agencies to prepare EIRs even for projects that meet the criteria for MNDs. SB 607 would alter the status quo by applying the more deferential “substantial evidence” standard to MNDs. The bill also provides that an EIR would be required if the lead agency determines that it is “more likely than not” that the project will have a significant effect on the environment—raising the threshold for preparing an EIR from the current “may have a significant effect” standard. These changes will make lead agencies more confident in preparing MNDs for projects that qualify, and make them more widely available as a result.
    • Infill Project Provisions: Directs the Governor’s Office of Land Use and Climate Innovation (formerly known as the Office of Planning and Research) to expand means of compliance with the urban infill categorical exemption (Class 32), and to map urban infill sites that are eligible for the exemption.
    • Housing Element Rezoning Exemption: Exempts any rezoning that implements an approved housing element, except for rezonings that would allow distribution centers, oil and gas infrastructure, or development on natural and protected lands.
    • Record of Proceedings: Narrows the scope of the administrative record for CEQA litigation by excluding certain internal agency communications that were not presented to the final decision-making body. Currently, internal communications are included, which can make preparation of the administrative record a lengthy and expensive process, resulting in protracted litigation timelines.
    • Judicial Remedies: If a court finds a CEQA exemption was improperly issued, the court’s remedy is limited to addressing only the condition(s) that made the project ineligible for the exemption.

    Overview of AB 609

    Assemblymember Buffy Wicks’ bill, the “Environmentally Beneficial Housing Exemption,” is designed to exempt additional urban multi-family housing projects from CEQA review. The qualifying criteria expand on the existing Class 32 categorical exemption, which is only available for smaller infill projects. The Class 32 exemption is currently one of the more widely used exemptions for infill projects, so AB 609 would expand the types of infill housing projects that are exempt. And by making it a statutory exemption, projects would not be subject to the “exceptions” that apply to categorical exemptions. Key criteria include:

    • Project Size and Location: The project site must be no larger than 20 acres, located either within the boundaries of an incorporated municipality or within a census-designated urban area. The existing infill exemption is limited to sites no larger than 5 acres and within city limits, so is not available to sites that are “urban” but unincorporated.
    • Urban Development Criteria: The project site must either have been previously developed with an urban use or at least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses.
    • Consistency with Local Plans: Projects must be consistent with the applicable general plan, zoning ordinance, and local coastal program. If the general plan and zoning are inconsistent, consistency with either is sufficient.
    • Density Requirements: The project must provide at least half the minimum density specified for housing element sites under state law.
    • Tribal Cultural Resource Protections: For sites not previously developed with urban uses, the project must not create an impact to tribal cultural resources that cannot be mitigated.
    • Historical Resources: The project does not require the demolition of a historic structure that has been placed on a national, state, or local historic register.
    • Environmental Assessment: As a condition of approval, the local government must require a Phase I environmental site assessment. If contamination is found, further assessment and remediation are required before occupancy.
    • Additional Requirements for Sites Adjacent to a Freeway: Housing projects within 500 feet of a freeway must contain certain design features that address air quality impacts, including (1) centralized HVAC, (2) outdoor air intakes that face away from the freeway, (3) air filtration that provides a minimum efficiency reporting value of 16, and (4) no balconies that face the freeway.

    CEQA reform elicits strong reactions, as evidenced by the lengthy list of supporters and opponents who have already weighed in, so the fate of these two bills is uncertain at this time.

    • SB 607 is co-sponsored by the Bay Area Council, Housing Action Coalition, Prosperity California, and Rural County Representatives of California, with additional supporters including California YIMBY, SPUR, and other pro-housing and business groups. The bill is opposed by a number of environmental and interest groups, such as the Sierra Club California, Center for Biological Diversity, and Natural Resources Defense Council.
    • AB 609 is also co-sponsored by the Bay Area Council along with California YIMBY, with additional support from a range of business and trade groups, the City of San Diego, and a few local elected officials. AB 609 is opposed by Livable California, the State Building & Construction Trades Council of California, and other environmental and environmental justice groups.

    The specifics of each bill will likely change as they work their way through the Legislature, but both promise meaningful improvement for infill projects if passed in their current, or substantially similar, form. We will be monitoring both bills, as well as other efforts to streamline and incentivize housing production in this legislative session.

    Posted on: May 19, 2025 Tags: Categories: Blogs

  • Legal Strategies for Wineries Facing Challenges, Including Tariffs

    Coblentz partners Brandi Brown and Michael Maher addressed questions regarding legal avenues available to mitigate shifting policies on tariffs, trade, and import-export regulations and steps vintners and growers can take to address labor shortages while staying compliant with immigration and wage laws in the North Bay Business Journal article “Wine Law Experts Discuss Legal Strategies for Wineries Facing Challenges, Including Tariffs.” The article is linked here.

  • City Arts & Lectures: Upcoming Conversation with Jonathan Bass and Ron Chernow on May 21

    On May 21, 2025, Coblentz partner Jonathan Bass will be at City Arts & Lectures in conversation with Ron Chernow, a celebrated American biographer and historian known for his deeply researched portrayals of key American figures. Chernow earned acclaim with biographies like The House of Morgan, which won the National Book Award, and Alexander Hamilton, the inspiration behind Lin-Manuel Miranda’s hit musical Hamilton. His biography Washington: A Life earned him the Pulitzer Prize, and his nuanced portrayal of Ulysses S. Grant further cemented his reputation.

    This isn’t the first time Jon has been in discussion with notable figures at City Arts & Lectures. In 2011, he was in conversation with Ian Frazier, a humorist, author, and contributor to The New Yorker; in 2013 he spoke with Daniel Kahneman, a psychologist credited with founding the study of behavioral economics and winner of a Nobel Prize in Economic Sciences; and in 2014 he sat with American political consultants James Carville and Mary Matalin.

    Additional details and tickets are available here.

    Posted on: Tags: Categories: Events

  • Second Circuit Limits VPPA Claims Regarding Meta Pixel Data Collection in Solomon v. Flipps Media: A Win for Companies Using Website Analytics Tools

    By Scott Hall

    In a significant development for companies targeted by (or vulnerable to) litigation over website data collection practices, the U.S. Court of Appeals for the Second Circuit affirmed the dismissal of a Video Privacy Protection Act (VPPA) claim based on Meta Pixel data collection in Solomon v. Flipps Media, Inc., 2025 WL 1234567 (2d Cir. May 1, 2025). The court held that the Meta Pixel’s transmission of a Facebook user’s ID combined with a video title embedded in a URL string does not constitute “personally identifiable information” (PII) under the VPPA. The decision provides welcome clarity for companies using standard web analytics tools—particularly those offering video content—and pushes back against the increasingly expansive interpretations of the VPPA seen in some recent district court decisions.

    Background and Holding

    Plaintiff Detrina Solomon, a subscriber to FITE TV, alleged that the platform violated the VPPA by disclosing her Facebook ID and the titles of videos she viewed to Meta via the Meta Pixel. She argued that this combination of data constituted PII that could allegedly identify her as having watched specific videos.

    The Second Circuit disagreed. Aligning with the Third and Ninth Circuits, the court adopted the “ordinary person” test for assessing whether information qualifies as PII. Under this standard, VPPA liability attaches only where the disclosed information would allow an average person—without access to specialized tools or insider knowledge—to identify a specific individual as having viewed specific video content.

    The court found that neither a Facebook ID nor a video title embedded in a URL, alone or in combination, would enable an ordinary person to make that connection. As a result, the court concluded that Solomon’s allegations failed to state a plausible VPPA claim.

    Implications for Businesses

    The decision offers meaningful relief for companies that rely on standard website tracking tools, including those that offer video content or embed videos on their platforms. A wave of VPPA class actions has recently targeted businesses simply for using the Meta Pixel or similar technologies that transmit data like video page URLs and user identifiers. Solomon holds that such passive disclosures do not satisfy the VPPA’s PII standard in the Second Circuit.

    However, companies should not take this as a green light to ignore potential risks. Data collection practices involving video content remain a focal point for privacy litigation, particularly where health, financial, or sensitive consumer data is involved.

    Ongoing Litigation Risks

    Additionally, while Solomon narrows the scope of VPPA claims, plaintiffs’ attorneys continue to pursue alternative theories under other federal and state laws, including wiretap statutes and pen register and trap and trace laws. These laws focus on the interception or disclosure of electronic communications (distinct from viewed video content)—an area where use of third-party analytics scripts like the Meta Pixel can still create risk exposure.

    Companies using marketing pixels, event tracking scripts, or other analytics tools—especially on video-enabled pages—should continue to consult with counsel to evaluate their risk posture, ensure appropriate user disclosures are in place, and adopt reasonable technical safeguards.

    Conclusion

    Solomon represents a key victory for businesses, particularly in the Second Circuit, and is likely to reduce the viability (and number) of VPPA claims based on website data collection. Still, companies must remain vigilant. The regulatory and litigation landscape surrounding online tracking technologies remains dynamic, and legal risks extend beyond the VPPA. Companies must continue to be alert in the ever-evolving landscape of data privacy.