California disclosure law has national reach

Thursday, 9 January 2003, 1:36 AM EST

A new California law requiring companies to notify their customers of computer security breaches applies to any online business that counts Californians as customers, even if the company isn't based in the Golden State.

So warned Scott Pink, deputy chair of the American Bar Association's Cybersecurity Task Force, in a conference call Monday organized by an industry trade group and attended by approximately 50 representatives of technology companies and law firms concerned about the scope of the new law, which will take effect on July 1st of this year.

"If you are selling products or providing services to residents of California, it would probably be determined that you're conducting business in California under this law," said Pink. "This is something that has captured the attention of many corporate counsel and many IT managers around the United States, as they try to understand what the law requires and how it impacts them."

The law, called "SB 1386," is intended to combat identity theft. It passed last September in the wake of a high-profile computer intrusion into a California state government system that housed payroll information on 200,000 state workers, in which the victim employees were not warned that their personal information was stolen until weeks after the incident. The law passed over strong objections from industry groups.

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