At the Ecommerce Innovation Alliance (EIA), we believe that business owners should be able to use standard, modern technology to serve their customers without living in fear of predatory lawsuits. Unfortunately, in California, a 1960s-era privacy law is being twisted into a tool for legal “shakedowns” that target legitimate ecommerce brands.

That is why we are proud to announce that EIA is continuing its work on this important issue by joining with a broad and growing coalition of advocates and industry leaders that have stepped forward to urge final passage of  Senate Bill 690 (SB 690). Authored by Senator Anna Caballero, SB 690 aims to reduce legal ambiguity and clarify how CIPA applies in today’s digital environment. Our support for this effort builds directly on the work we began last year to advance common-sense reform to the California Invasion of Privacy Act (CIPA).”

The CIPA Crisis: Why Your Website is a Target

Originally designed to prevent physical wiretapping in 1967, CIPA is now being exploited by opportunistic plaintiffs’ attorneys to target online businesses. Under their theory, common tools that every modern ecommerce site uses such as cookies, website analytics, chat features, and IP address tracking are considered “illegal wiretapping.”

The impact on small and medium-sized ecommerce businesses is staggering:

• The “Per Visitor” Threat:
  Lawsuits often claim $5,000 in damages per visitor. For a site with even modest traffic, these claims can quickly reach millions of dollars.
• The Shakedown:
  Most businesses receive “demand letters” asking for settlements between $20,000 and $50,000. Because defending these cases in court is so expensive, many brands feel forced to pay just to stay in business.
• Compliance Isn’t a Shield:
  Even if your brand is fully compliant with the California Consumer Privacy Act (CCPA), you can still be sued under CIPA.

SB 690 aims to provide the “Safe Harbor” that ecommerce owners desperately need. Essentially, if a business is operating in good faith and complying with modern privacy standards like the CCPA, SB 690 would protect them from these outdated “wiretapping” claims.

Strength in Numbers: The Stop CIPA Shakedowns Coalition

To fight back against this predatory litigation, our partners at Alliance for Legal Fairness have launched the website StopCIPAShakedowns.com. The site serves as a resource for business owners to learn more about the issue, explore data on how companies are being impacted, and find ways to get involved in the growing coalition supporting SB 690.

The EIA is proud to stand alongside a diverse group of businesses, non-profits and advocacy associations supporting SB 690, including:

By joining forces, we are sending a clear message to the California Assembly: it is time to protect legitimate businesses from legal exploitation.

SB 690 Gains Momentum in the Legislative Process

Since its introduction, SB 690 has steadily gained momentum, advancing through key Senate committees before passing the Senate with strong bipartisan support. The bill now moves to the Assembly, where lawmakers will continue to evaluate its impact as coalition support grows. 

In the coming months, advocacy efforts will focus on maintaining that momentum and ensuring the bill reaches the Governor’s desk, bringing much-needed clarity and balance to how CIPA is applied in today’s digital economy.

EIA’s Continued Leadership in CIPA Reform

Our involvement in this coalition is part of our long-term commitment to CIPA reform. From our initial analysis of the CIPA challenge to celebrating the bill’s advancement through the Senate Public Safety Committee, we have been there every step of the way.

We will continue to work closely with Alliance for Legal Fairness and the coalition of industry partners behind Stop CIPA Shakedowns to advocate for your right to grow your business without the threat of a legal shakedown. 

The EIA will continue providing updates as SB 690 moves through the Assembly.

How You Can Help

The best way to protect your business is to stay informed and to take action where you can.

1. Visit StopCIPAShakedowns.com to learn more about SB 690 and how these lawsuits are impacting businesses across California.
2. Follow Stop CIPA Shakedowns on LinkedIn, X, Facebook and Instagram to stay up to date and help amplify awareness.
3. Share your story. If your business has been impacted by a CIPA demand letter or lawsuit, your experience can make a real difference. Lawmakers are actively looking to understand how these cases affect real businesses. Your voice helps shape that conversation.

There are several ways to get involved:

• Participate in a direct conversation with policymakers
• Share your experience through a confidential voicemail or written submission
• Submit a letter of support or add your company’s name to advocacy efforts
• Join a meeting with your State Assembly member
• Speak with media to help raise awareness

Even if your case was settled – or covered by an NDA – you may still be able to share your experience in general terms.

If you’re interested in participating or learning more, visit StopCIPAShakedowns.com or reach out directly at info@stopcipashakedowns.com.

The Ecommerce Innovation Alliance (EIA) provides members with analysis of litigation and regulatory developments affecting online commerce and digital marketing. This post is for informational purposes only and does not constitute legal advice.