Lawmakers Balk at Revised Model Digital Assets Bill

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By Laura Mahoney

May 9 — Concerns about whether a deceased person's choices in a social media account should outweigh instructions in a will may stall passage in California of a model law moving swiftly through at least a dozen other states to give personal representatives access to a deceased person's digital assets.

Senators who moved the Revised Uniform Fiduciary Access to Digital Assets Act (A.B. 691) out of the Senate Judiciary Committee May 3 said they felt a sense of urgency to adopt clear rules. But some said they might want to amend the bill to address their concerns before it can win passage from the full Senate.

“If we're going to end up with an instruction on the Internet trumping a testamentary statement this could create some real problems going forward, or not, but my instinct is that it would,” Sen. Hannah-Beth Jackson (D), chair of the committee, said before the 6-0 vote.

Specific Wishes

Practitioners who worked to craft the measure told Bloomberg BNA that some of the concerns raised in the California Senate have come up during debate in other states. But they haven't kept the measure from passing because the model law is consistent with other rules related to resolving a decedent's assets and will, they said.

Just as a designated beneficiary on a life insurance policy trumps a conflicting statement in a person's will, if a person uses a specific tool in an online account to designate who can have access to it after death, that designation also trumps a will, Benjamin Orzeske, chief counsel for the Uniform Law Commission, told Bloomberg BNA May 6.

“The specific designation prevails over the general,” he said.

Third Vote in Committee

The 6-0 vote May 3 was the third time since July that A.B. 691 by Assemblyman Ian Calderon (D) passed the same committee after being amended. But the latest version contains a revised uniform state law negotiated by the Uniform Law Commission rather than provisions mainly backed by the business community.

An earlier version passed the Assembly in June 2015 and the Senate Judiciary Committee in July and September (20 ECLR 1280, 9/16/15). The latest version only needs approval from the full Senate and a vote from the Assembly to concur in Senate amendments by the end of August to reach the governor's desk.

Although they still have a few months to negotiate and meet legislative deadlines, the same business groups that backed the old and new versions of A.B. 691 plan to push for passage in the next few weeks, John Doherty, vice president of state policy and politics for TechNet, told Bloomberg BNA May 5.

“The sooner it's signed the sooner we have clarity about what the law is,” Doherty said.

No More Opt In

Until it was amended in April, Calderon's bill was called the Privacy Expectation Afterlife Choices Act—a measure largely drafted by the business groups. It would have allowed digital service providers to disclose a deceased person’s online account information to an estate executor or other designated representative only if the deceased person opted in by making that choice in his or her will, or through an agreement with the service provider.

The latest version is similar but offers alternatives to a strict opt in for release of digital assets to a fiduciary. It would give first priority to a deceased user's instructions in an online tool about whether to release digital asset information to a fiduciary, for example through Facebook Inc.'s Legacy Contact tool or Google Inc.'s Inactive Account Manager tool. A user must be allowed to modify preferences using the tool at any time.

If a user left no instructions with such tools, the person's designation in a will would control. If a deceased user left no instructions either through an online tool or a will, the terms of service for individual online accounts would govern.

Sweeping the States

Since the ULC revised its proposed model law in September, it has been introduced in 30 states and enacted in 11, including Florida, Indiana, Michigan and Washington, according to the ULC (20 ECLR 1364, 9/30/15). California's proposal contains the model law's provisions related to decedents, but not provisions related to conservatorships.

TechNet and other companies and business groups, including Facebook, the Internet Association, Google and Yahoo! Inc., support the revised UFADAA provisions in A.B. 691, although they preferred Calderon's bill in its original form, Doherty said. The revised UFADAA is a compromise.

The switch to the revised UFADAA has shifted the position of other groups watching the bill. The Judicial Council of California, which represents the courts, and the California Judges Association were opposed to Calderon's earlier bill because they said it would have resulted in too many disputes heading to court. Now they are neutral on the bill, their representatives told the committee.

Opposition from Privacy Groups

Privacy and consumer groups that took a neutral position on the Calderon bill before it contained the revised UFADAA provisions, including the American Civil Liberties Union of California, Electronic Frontier Foundation and Privacy Rights Clearninghouse, now oppose it.

“Unfortunately we think this bill does very little or nothing to give technology companies the incentive to behave responsibly,” Kevin Baker, legislative director of the ACLU of California, told the committee.

Baker told Bloomberg BNA May 5 the ACLU's primary concerns are the fact that the bill would give custodians of the digital assets, such as the social media companies or financial institutions, “sole discretion” to decide whether to release the information along with immunity from liability. With such discretion, it is likely the custodians will make mistakes and release information when they shouldn't, he said.

The issue of whether a user's online tool settings take priority over a will, even if the will came after the user's online tool settings, is also a concern, Baker said.

Suzanne Brown Walsh, an attorney with Murtha Cullina LLP in Hartford, Conn. who chaired the UFADAA drafting committee, told Bloomberg BNA most lawmakers in other states haven't raised the concerns that have arisen in the California Senate. Once they understand that a user's preferences in an online tool are similar to designations in other settings such as a life insurance beneficiary, lawmakers have supported the revised UFADAA, she said.

To contact the reporter on this story: Laura Mahoney in Sacramento, Calif. at lmahoney@bna.com

To contact the editor responsible for this story: Alexis Kramer at akramer@bna.com