This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: h1541c.COM
DATE: 2/23/2024
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: CS/HB 1541 Transparency In Social Media
SPONSOR(S): Regulatory Reform & Economic Development Subcommittee, Fine
TIED BILLS: IDEN./SIM. BILLS: SB 1448
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Regulatory Reform & Economic Development
Subcommittee
12 Y, 0 N, As CS Wright Anstead
2) Commerce Committee 17 Y, 0 N Wright Hamon
SUMMARY ANALYSIS
Social media includes forms of electronic communication, such as websites for social networking and
microblogging, through which users create online communities to share information, ideas, videos, personal
messages, and other content. In 2023, an estimated 4.9 billion people worldwide used social media. Recently,
there has been growing concerns of influence over social media platforms by foreign adversaries.
The bill requires each foreign-adversary-owned entity operating a social media platform in Florida to:
Publicly disclose the core functional elements of the social media platform's content curation and
algorithms. Such disclosure must identify:
o The factors that influence content ranking and visibility.
o Measures taken to address misinformation and harmful content.
o The process of personalization and targeting of content.
Make publicly available the source code of its algorithms through an open-source license.
Implement a user verification system for each user and organization that purchases advertisements
concerning social or political issues.
o The system must verify key identifying information, including:
Citizenship,
Residency, and
Age of the user or the individuals that own the organization.
o Once verified, the identity of the purchaser of each social or political advertisement must be
disclosed with the advertisement.
The bill defines the following terms:
"Foreign-adversary-owned entity" means a social media company that is 15 percent owned or
controlled by nationals, governments, or corporations domiciled, incorporated, or otherwise holding
residence in a country designated as a foreign adversary.
"Social media platform" means a public online service that allows users to create and share or
participate in social networking.
"Social or political advertising" means any advertisement on a social media platform that discusses
social or political issues or is intended to influence public opinion or electoral outcomes.
The bill provides that a foreign-adversary-owned entity that violates the requirements of the bill is liable up to
$10,000 for each discrete violation, and requires the Department of Legal Affairs to enforce the bill.
The bill will have an indeterminate, negative fiscal impact on state government, and no impact on local
government.
The bill provides an effective date of July 1, 2024. STORAGE NAME: h1541c.COM PAGE: 2
DATE: 2/23/2024
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Current Situation
Internet and Social Media Platforms
There are many ways in which individuals access computer systems and interact with systems and
other individuals on the Internet. Examples include:
Social media sites, which are websites and applications that allow users to communicate
informally with others, find people, and share similar interests;
1
Internet platforms, which are servers used by an Internet provider to support Internet access by
their customers;
2
Internet search engines, which are computer software used to search data (such as text or a
database) for specified information;
3
and
Access software providers, which are providers of software (including client or server software)
or enabling tools for content processing.
4
Such platforms earn revenue through various modes and models. Examples include:
Data monetization.
5
This uses data that is gathered and stored on the millions of users that
spend time on free content sites, including specific user location, browsing habits, buying
behavior, and unique interests. This data can be used to help e-commerce companies tailor
their marketing campaigns to a specific set of online consumers. Platforms that use this model
are typically free for users to use.
6
Subscription or membership fees. This model requires users pay for a particular or unlimited
use of the platform infrastructure.
7
Transaction fees. This model allows platforms to benefit from every transaction that is enabled
between two or more actors. An example is AirBnB, where users transacting on the site are
charged a fee.
8
Trade Secrets
Generally, trade secrets are intellectual property rights on confidential information that are used by a
business and provide an economic advantage to that business.
9
Section 812.081, F.S., defines a “trade secret” as information
10
used in the operation of a business,
which provides the business an advantage or an opportunity to obtain an advantage, over those who
1
DelValle Institute Learning Center, Social Media Platforms, available at https://delvalle.bphc.org/mod/wiki/view.php?pageid=65 (last
visited Jan. 29, 2024).
2
IGI Global, Internet Platform, available at https://www.igi-global.com/dictionary/internet-platform/15441 (last visited Jan. 29, 2024).
3
Merriam Webster, Search Engine, available at https://www.merriam-webster.com/dictionary/search%20engine (last visited Jan. 29,
2024).
4
47 U.S.C. § 230(f)(4) defining “access software provider to mean a provider of software (including client or server software), or
enabling tools that do any one or more of the following: (i) filter, screen, allow, or disallow content; (ii) pick, choose, analyze, or digest
content; or (iii) transmit, receive, display, forward, cache, search, subset, organize, reorganize, or translate content.
5
The Alexander von Humboldt Institute for Internet and Society, How do digital platforms make their money?, July 29, 2019, available
at https://www.hiig.de/en/how-do-digital-platforms-make-their-money/ (last visited Jan. 29, 2024).
6
Investopedia, How Do Internet Companies Profit with Free Services?, available at
https://www.investopedia.com/ask/answers/040215/how-do-internet-companies-profit-if-they-give-away-their-services-
free.asp#:~:text=Profit%20Through%20Advertising,content%20is%20through%20advertising%20revenue.&text=Each%20of%20these
%20users%20represents,and%20services%20via%20the%20Internet (last visited Jan. 29, 2024).
7
HIIS, supra note 5.
8
Id.
9
See The Florida Bar, Trade Secret (Dec. 14, 2022) https://www.floridabar.org/practice-areas/trade-secrets/ (last visited Jan. 29, 2024).
10
A trade secret may manifest as any scientific, technical, or commercial information, including any design, process, procedure, list of
suppliers, list of customers, business code, or improvement thereof. Section 812.081, F.S. STORAGE NAME: h1541c.COM PAGE: 3
DATE: 2/23/2024
do not know or use it. The test provided for in statute, and adopted by Florida courts,
11
requires that a
trade secret be actively protected from loss or public availability to any person not selected by the
secret’s owner to have access thereto, and be:
Secret;
Of value;
For use or in use by the business; and
Of advantage to the business, or providing an opportunity to obtain an advantage, over those
who do not know or use it.
12
Florida law criminalizes the disclosure or theft of trade secrets. For example:
Section 815.04, F.S., makes it a third degree felony
13
for a person to willfully, knowingly, and
without authorization disclose or take data, programs, or supporting documentation that are
trade secrets that reside or exist internal or external to a computer, computer system, computer
network, or electronic device.
14
Section 812.081, F.S., makes it a third degree felony for a person to steal, embezzle, or copy
without authorization an article that represents a trade secret, when done with an intent to:
o Deprive or withhold from the trade secret’s owner the control of a trade secret, or
o Appropriate a trade secret to his or her own use or to the use of another.
Florida SB 7072 (2021)
In 2021, the Florida Legislature passed SB 7072, which addressed concerns related to social media
platforms. SB 7072 was signed by the Governor on May 24, 2021.
15
Section 501.2041, F.S., was
created, which provides that a social media platform must:
Publish standards used for determining how to censor, deplatform, and shadow ban users, and
apply such standards in a consistent manner;
Inform each user about any changes to its user rules, terms, and agreements before
implementing the changes and not make changes more than once every 30 days;
Notify a user in a specified manner censoring or deplatforming the user;
Allow a user to request the number of other individuals who were shown the user's content or
posts, and provide such information upon such request by the user;
Provide users with an option to opt out of post-prioritization and shadow banning algorithms to
allow sequential or chronological posts and content;
Provide users with an annual notice on the use of algorithms for post-prioritization and shadow
banning and reoffer annual notice on the use of algorithms for post-prioritization and shadow
banning;
Ensure that posts by or about candidates for office in Florida are not shadow banned;
Allow a user who has been deplatformed to access or retrieve all of the user’s information,
content, material, and data for at least 60 days after the user receives the required notice; and
Ensure that journalistic enterprises are not censored, deplatformed, or shadow banned.
In s. 501.2041, F.S., “Social media platform” is defined as any information service, system, Internet
search engine, or access software that:
Provides or enables computer access by multiple users to a computer server, including an
Internet platform and/or a social media site;
Operates as a sole proprietorship, partnership, limited liability company, corporation,
association, or other legal entity;
Does business in Florida; and
Satisfies at least one of the following thresholds:
11
See, e.g., Sepro Corp. v. Dep’t. of Envt’l. Prot., 839 So. 2d 781 (Fla. 1
st
DCA 2003).
12
Section 812.081(1)(c), F.S.
13
A third degree felony is punishable by up to 5 years imprisonment and a $5,000 fine. See ss. 775.082 and 775.083, F.S.
14
The offense is a second degree felony if committed for the purpose of creating or executing any scheme or artifice to defraud or to
obtain property.
15
Ch. 2021-32, L.O.F. STORAGE NAME: h1541c.COM PAGE: 4
DATE: 2/23/2024
Annual gross revenues in excess of $100,000,000, as adjusted in January of each odd
numbered year to reflect any increase in the Consumer Price Index; or
At least 100,000,000 monthly individual platform participants globally.
Section 501.2041, F.S., also provides for enforcement by permitting the Department of Legal Affairs
(DLA) to find a social media platform who fails to comply with the requirements stated above to be in
violation of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). Additionally, a user may
bring a private cause of action against a social media platform for failing to consistently apply certain
standards for censoring or deplatforming without proper notice.
Litigation History
Immediately after the bill was signed by the Governor, but prior to the bill’s effective date of July 1,
2021, the plaintiff filed a complaint in the U.S. District Court for the Northern District of Florida
challenging the constitutionality of many of the bill’s provisions and exceptions, and immediately moved
the Court for a preliminary injunction. The District Court granted the preliminary injunction on June 30,
2021.
16
The filed complaint alleges the following:
Count 1 of the complaint alleges the Act “violates the First Amendment's free-speech clause by
interfering with the providers’ editorial judgment, compelling speech, and prohibiting speech.”
Count 2 alleges the Act “is vague in violation of the Fourteenth Amendment.”
Count 3 alleges the Act “violates the Fourteenth Amendment's equal protection clause by
impermissibly discriminating between providers that are or are not under common ownership
with a large theme park and by discriminating between providers that do or do not meet the
Act's size requirements.”
Count 4 alleges the Act “violates the Constitution's dormant commerce clause.”
Count 5 alleges the Act “is preempted by 47 U.S.C. § 230(e)(3), which, together with §
230(c)(2)(A), expressly prohibits imposition of liability on an interactive computer service—this
includes a social-media provider—for action taken in good faith to restrict access to material the
service finds objectionable.”
17
The District Court indicated that the law was not clearly settled related to issues about First
Amendment treatment of social-media providers: “The plaintiffs say, in effect, that they should be
treated like any other speaker. The State says, in contrast, that social-media providers are more like
common carriers, transporting information from one person to another much as a train transports
people or products from one city to another. The truth is in the middle.”
18
The District Court determined that strict scrutiny applied as the standard to be used:
“Viewpoint- and content-based restrictions on speech are subject to strict scrutiny. A law restricting
speech is content-based if it “applies to particular speech because of the topic discussed or the idea or
message expressed.” Laws that are facially content-neutral, but that cannot be justified without
reference to the content of the regulated speech, or that were adopted because of disagreement with
the speaker's message, also must satisfy strict scrutiny.”
19
The District Court enjoined the State from enforcing any provision of s. 501.2041, F.S., on preemption
and First Amendment grounds.
The State filed an appeal of the District Court’s decision in the U.S. Court of Appeals for the Eleventh
Circuit.
16
NetChoice, LLC v. Moody, 546 F. Supp. 3d 1082 (N.D. Fla. 2021) (NetChoice, LLC, and the Computer & Communications Industry
Association are trade associations whose members include social media providers).
17
NetChoice, LLC, 546 F. Supp. 3d at 1085.
18
NetChoice, LLC, 546 F. Supp. 3d at 1091.
19
NetChoice, LLC, 546 F. Supp. 3d at 1093. STORAGE NAME: h1541c.COM PAGE: 5
DATE: 2/23/2024
On May 23, 2022, the U.S. Court of Appeals for the Eleventh Circuit affirmed the district court’s
preliminary injunction in part, and vacated and remanded it in part.
20
The Eleventh Circuit found the following provisions of SB 7072, to likely violate the First Amendment:
Section 106.072(2), F.S., which pertains to candidate deplatforming;
Section 501.2041(2)(h), F.S., which pertains to the use of algorithms for the purpose of post-
prioritization or shadow banning candidates;
Section 501.2041(2)(j), F.S., which pertains to journalistic enterprises;
Section 501.2041(2)(b), F.S., which pertains to the consistent application of censorship,
deplatforming, and shadow banning standards;
Section 501.2041(2)(c), F.S., which limits the number of changes that can be made to once
every 30 days;
Sections 501.2041(2)(f) and 501.2041(2)(g), F.S., which pertain to categorizing algorithms used
for post-prioritization and shadow banning, as well as allowing for user opt-outs; and
Section 501.2041(2)(d), F.S., which pertains to notifying a user when their content is censored
or shadow banned.
However, the Eleventh Circuit found the following provisions of SB 7072, to likely not violate the First
Amendment:
Section 501.2041(2)(a), F.S., which pertains to the publication of standards used for
determining how to censor, deplatform, and shadow ban;
Section 501.2041(2)(c), F.S., which pertains to informing users to any changes to its user rules,
terms, and agreements before implementing the changes;
Section 501.2041(2)(e), F.S., which pertains to user view counts;
Section 501.2041(2)(i), F.S., which pertains to user data access; and
Section 106.072(4), F.S., which pertains to free advertising for a candidate.
21
The United States Supreme Court is set to hear oral arguments on February 26, 2024.
Florida Data Privacy Regulations
In 2023, the Florida Legislature passed SB 262, which created a unified scheme to allow Florida’s
consumers to control the digital flow of their personal information. SB 262 was signed by the Governor
on June 6, 2023.
22
Among other things, SB 262 created ch. 501, part V, F.S., which takes effect on July
1, 2024, and gives Florida consumers the right to:
Confirm and access their personal data;
Delete, correct, or obtain a copy of that personal data;
Opt out of the processing of personal data for the purposes of targeted advertising, the sale of
personal data, or profiling in furtherance of a decision that produces a legal or similarly
significant effect concerning a consumer;
Opt out of the collection or processing of sensitive data, including precise geolocation data; and
Opt out of the collection of personal data collected through the operation of a voice recognition
or facial recognition feature.
The data privacy provisions of ch. 501, part V, F.S., generally apply to “controllers,” businesses that
collect Florida consumers’ personal data, make in excess of $1 billion in global gross annual revenues,
and meet one of the following thresholds:
Derives 50 percent or more if its global gross annual revenues from the online sale of
advertisements, including from providing targeted advertising or the sale of ads online;
Operates a consumer smart speaker and voice command component service with an integrated
virtual assistant connected to a cloud computing service that uses hands-free verbal activation;
or
Operates an app store or digital distribution platform that offers at least 250,000 different
software applications for consumers to download and install.
20
Moody v. NetChoice, LLC, 34 F.4th 1196 (11th Cir. 2022).
21
Moody, 34 F.4th 1196.
22
See ch. 2023-201, Laws of Fla. STORAGE NAME: h1541c.COM PAGE: 6
DATE: 2/23/2024
A controller who operates an online search engine is required to make available an up-to date plain
language description of the main parameters that are most significant in determining ranking and the
relative importance of those main parameters, including the prioritization or deprioritization of political
partisanship or political ideology in search results. A controller must also conduct and document a data
protection assessment of certain processing activities involving personal data. Additionally, a controller
is required to provide consumers with a reasonably accessible and clear privacy notice, updated at
least annually.
A violation of ch. 501, part V, F.S is an unfair and deceptive trade practice actionable under FDUTPA,
to be enforced by DLA. The DLA may provide a right to cure a violation of ch. 501, part V, F.S., by
providing written notice of the violation and then allowing a 45-day period to cure the alleged violation.
The DLA is required to make a report publicly available by February 1 each year on the DLA’s website
that describes any actions it has undertaken to enforce ch. 501, part V, F.S.
SB 262 also created s. 112.23, F.S., which prohibits employees of a governmental entity from using
their position or any state resources to communicate with a social media platform to request that it
remove content or accounts. Additionally, a governmental entity cannot initiate or maintain any
agreements with a social media platform for the purpose of content moderation. These prohibitions do
not apply to routine account maintenance, attempts to remove accounts or content pertaining to the
commission of a crime, or efforts to prevent imminent bodily harm, loss of life, or property damage.
Montana TikTok Law
On May 17, 2023, SB 419 was signed into law in Montana, which specifically banned TikTok in the
state.
23
However, on November 30, 2023, the law was preliminarily enjoined, based on several
constitutional concerns, including those related to bills of attainder, the Commerce Clause, the First
Amendment, and the Supremacy Clause, therefore preventing Montana from enforcing the ban on
TikTok’s operations.
24
The law lists concerns, including the People’s Republic of China’s (PRC’s) status as “an adversary,” as
well as TikTok’s status as a “subsidiary of . . . a Chinese corporation” over which “the [PRC] exercises
control and oversight,” improper procurement and sharing of user data, and promotion of “dangerous
content.”
25
SB 419 would ban TikTok in Montana by:
Prohibiting mobile application stores from making the TikTok app available to users in Montana;
Prohibiting TikTok’s operation in all places subject to Montana’s criminal jurisdiction; and
Including penalties and enforcement provisions.
26
According to the Congressional Research Service, to date, no other states have enacted a ban this
broad against TikTok or any other social media platform. Instead, more than half of U.S. states prohibit
the use of TikTok on at least some state-issued devices, and a number of public postsecondary
institutions have followed suit, enacting policies that prevent university Wi-Fi or university-issued
devices from being used to access the app.
27
Freedom of Speech and Internet Platforms
Section 230
23
Montana.gov, Governor Gianforte Bans TikTok in Montana, May 17, 2023, https://news.mt.gov/Governors-
Office/Governor_Gianforte_Bans_TikTok_in_Montana (last visitedFeb. 2, 2024).
24
Congressional Research Service, Montana’s TikTok Ban, an Injunction, and Pending Legal Actions (December 8, 2023), available at
https://crsreports.congress.gov/product/pdf/LSB/LSB10972#:~:text=Commerce%20Clause%3A%20The%20court%20found,concept%2
0Montana%20did%20not%20contest. (last visited Feb. 2, 2024).
25
Id.
26
Id.
27
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DATE: 2/23/2024
The federal Communications Decency Act (CDA) was passed in 1996 “to protect children from sexually
explicit Internet content.”
28
47 U.S. Code § 230 (Section 230) was added as an amendment to the CDA
to maintain the robust nature of Internet communication and, accordingly, to keep government
interference in the medium to a minimum.”
29
Congress stated in Section 230 that “[i]t is the policy of the United States—(1) to promote the continued
development of the Internet and other interactive computer services and other interactive media; [and]
(2) to preserve the vibrant and competitive free market that presently exists for the Internet and other
interactive computer services, unfettered by Federal or State regulation.”
30
Specifically, Section 230 states that no provider or user of an interactive computer service may be held
liable on account of:
31
Any action voluntarily taken in good faith to restrict access to or availability of material that the
provider or user considers to be obscene, lewd, lascivious, filthy, excessively violent, harassing,
or otherwise objectionable, whether or not such material is constitutionally protected; or
Any action taken to enable or make available to information content providers or others the
technical means to restrict access to material from any person or entity that is responsible for
the creation or development of information provided through any interactive computer service.
Section 230 eased Congressional concern regarding the outcome of two inconsistent judicial
decisions,
32
both of which applied traditional defamation law to internet providers.
33
The first decision
held that an interactive computer service provider could not be liable for a third party's defamatory
statement, however the second decision imposed liability where a service provider filtered content in an
effort to block obscene material.
34
To provide clarity, Section 230 provides that “[n]o provider ... of an
interactive computer service shall be treated as the publisher or speaker of any information provided by
another information content provider.”
35
In light of the objectives of Congress, the Circuits are in general
agreement that the text of Section 230(c)(1) should be construed broadly in favor of immunity.
36
Section 230 specifically addresses how the federal law affects other laws. Section 230 prohibits all
inconsistent causes of action and prohibits liability imposed under any state or local law.
37
However,
Section 230 does not affect federal criminal law, intellectual property law, the Electronic
Communications Privacy Act of 1986, or sex trafficking law.
There have been criticisms of the broad immunity provisions or liability shields which force individuals
unhappy with third-party content to sue the user who posted it. While this immunity has fostered the
free flow of ideas on the Internet, critics have argued that Section 230 shields publishers from liability
for allowing harmful content.
38
Congressional and executive proposals to limit immunity for claims
relating to platforms purposefully hosting content from those engaging in child exploitation, terrorism,
and cyber-stalking have been introduced.
39
Bills have been filed that would require internet platforms to
have clear content moderation policies, submit detailed transparency reports, and remove immunity for
28
See 1 Force v. Facebook, Inc., 934 F.3d 53, 63 (2d Cir. 2019) (citing FTC v. LeadClick Media, LLC, 838 F.3d 158, 173 (2d Cir. 2016)
(citing 141 Cong. Rec. S1953 (daily ed. Feb. 1, 1995) (statement of Sen. Exon)).
29
Force, 934 F.3d at 63 (quoting Ricci v. Teamsters Union Local 456, 781 F.3d 25, 28 (2d Cir. 2015) (quoting Zeran v. Am. Online, Inc.,
129 F.3d 327, 330 (4th Cir. 1997)).
30
47 U.S.C. § 230(b)(1)–(2).
31
47 U.S.C. § 230(c).
32
Cubby, Inc. v. CompuServe, Inc., 776 F. Supp. 135 (S.D.N.Y. 1991) and Stratton Oakmont, Inc. v. Prodigy Servs. Co., No. 31063/94,
1995 WL 323710 (N.Y. Sup. Ct. May 24, 1995).
33
Force, 934 F.3d at 63 (quoting LeadClick, 838 F.3d at 173).
34
Force, 934 F.3d at 63 (quoting LeadClick, 838 F.3d at 173 (citing 141 Cong. Rec. H8469-70 (daily ed. Aug. 4, 1995)
(statement of Rep. Cox))).
35
47 U.S.C. § 230(c)(1).
36
Force, 934 F.3d at 63.
37
47 U.S.C. § 230(e).
38
Zoe Bedell and John Major, What’s Next for Section 230? A Roundup of Proposals Lawfare, (July 29, 2020)
https://www.lawfareblog.com/whats-next-section-230-roundup-proposals (last visited Feb. 2, 2024).
39
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DATE: 2/23/2024
platforms that engage in certain behavioral advertising practices.
40
Proposals have also been offered to
limit the liability shield for internet providers who restrict speech based on political viewpoints.
41
Recently, the United States Supreme Court heard Twitter, Inc. v. Taamneh and Gonzalez v. Google;
these cases alleged that Twitter and Google aided and abetted terrorists who posted content to their
platforms, and a key issue in both cases was whether social media companies can be held liable for
their targeted recommendation algorithms.
42
However, the court decided both cases on alternative
grounds, which leaves the question unanswered.
Freedom of Speech
The First Amendment of the United States Constitution protects the right to freedom of expression from
government interference. The First Amendment is applicable to the states through the Due Process
Clause of the Fourteenth Amendment.
43
“The First Amendment assures the broadest tolerable exercise
of free speech, free press, and free assembly, not merely for religious purposes, but for political,
economic, scientific, news, or informational ends as well.”
44
“Online speech is equally protected under
the First Amendment as there is ‘no basis for qualifying the level of First Amendment scrutiny that
should be applied’ to online speech.”
45
It is well established that a government regulation based on the content of speech is presumptively
invalid and will be upheld only if it is necessary to advance a compelling governmental interest,
precisely tailored to serve that interest, and is the least restrictive means available for establishing that
interest.
46
The government bears the burden of demonstrating the constitutionality of any such content-
based regulation.
47
The United States Supreme Court has recognized that First Amendment protection extends to
corporations.
48
“This protection has been extended by explicit holdings to the context of political
speech.”
49
Under these precedents, it is well settled that political speech does not lose First
Amendment protection “simply because its source is a corporation.”
50
Generally, the government may
not require a corporation to host another’s speech absent a showing of a compelling state interest.
51
Supremacy Clause, Commerce Clause, and Bills of Attainder
The U.S. Constitution’s Supremacy Clause establishes that federal statutes, treaties, and the U.S.
Constitution are the “supreme Law of the Land.”
52
Federal law may preempt state action that thwarts federal law in three ways:
By an express statement of its intent to occupy a field. Express preemption need not be total,
however—it can preempt all state laws or only certain state laws.
40
Id.; PACT Act, S.4066, 116th Cong. (2020); BAD ADS Act, S.4337, 116th Cong. (2020).
41
Bedell, supra note 38; Limiting Section 230 Immunity to Good Samaritans Act, S.3983, 116th Cong. (2020).
42
See Twitter, Inc. v. Taamneh, 143 S. Ct. 1206 (2023) and Gonzalez v. Google LLC, 143 S. Ct. 1191 (2023).
43
See De Jonge v. Oregon, 299 U.S. 353, 364–65(1937)(incorporating right of assembly);(incorporating right of freedom of speech).
44
Douglas v. City of Jeannette (Pennsylvania), 319 U.S. 157, 179, (1943) (Jackson, J., concurring in result).
45
Reno v. Am. Civil Liberties Union, 521 U.S. 844, 870 (1997).
46
Ashcroft v. Am. Civil Liberties Union, 542 U.S. 656, 665-66 (2004).
47
Ashcroft, 542 U.S. 656, at 660.
48
Citizens United v. Federal Election Commission, 558 U.S. 310, 342 (2010).
49
Id. (citing NAACP v. Button v. 371 U.S.415, 428-429 (1963); Grosjean v. American Press Co., 297 U.S. 233, 244 (1936)).
50
Id. (citing First Nat. Bank of Boston v. Bellotti, 435 U.S. at 784 (1978); Pacific Gas & Elec. Co. v. Public Util. Comm'n of Cal., 475
U.S. 1, 8, 106 S.Ct. 903, 89 L.Ed.2d 1 (1986) (plurality opinion) (“The identity of the speaker is not decisive in determining whether
speech is protected. Corporations and other associations, like individuals, contribute to the ‘discussion, debate, and the dissemination
of information and ideas' that the First Amendment seeks to foster” (quoting Bellotti, 435 U.S., at 783)).
51
Consolidated Edison Co. v. Public Service Commission, 447 U.S. 530 (1980); First National Bank of Boston v. Belliotti, 438 U.S.
(1978); Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241 (1974); Pacific Gas & Electric Co. v. Public Utilities Commission of
California, 475 U.S. 1 (1986).
52
U.S. CONST., Art. VI, cl. 2. STORAGE NAME: h1541c.COM PAGE: 9
DATE: 2/23/2024
With “a framework of regulation so pervasive that Congress left no room for the States to
supplement it or where the federal interest is so dominant that the federal system will be
assumed to preclude enforcement of state laws on the same subject.”
53
Where state law conflicts, leaving an actor to choose whether to adhere to state or federal law.
54
The state law may also be subject to conflict preemption where it “stands as an obstacle to the
accomplishment and execution of the full purposes and objectives of Congress.”
55
The federal government’s authority to act in the realm of foreign affairs is vested by the U.S.
Constitution.
56
State laws that intrude into this field of foreign affairs, even where not preempted by
prior federal action, improperly impact foreign affairs and are therefore invalid.
57
Courts have generally
held, however, that the state’s intrusion must have more than an “incidental effect” on foreign affairs in
order to be considered an encroachment onto the federal government’s powers.
58
Article I, section 8, clause 3 of the U.S. Constitution grants Congress the power to “regulate commerce
with foreign nations ....” Conversely, this provision serves as a limitation on states’ authority to
encroach onto the realm of foreign commerce where such action creates a risk of conflicts with foreign
governments or impedes the federal government’s ability to speak with one voice in regulating industry
affairs with foreign states.
59
The “dormant foreign commerce power”
60
voids state acts upon foreign
commerce because of the Constitution's overriding concern for national uniformity in foreign
commerce—even in instances when Congress has not affirmatively acted.
61
Courts also generally
subject state action to a heightened scrutiny that assumes the supremacy of federal action in the realm
of foreign relations.
62
Additionally, Congress has the power to regulate commerce among the states.
63
Though phrased as a
grant of regulatory power to Congress, the Commerce Clause has long been understood to have a
negative or dormant aspect that denies the states the power to unjustifiably discriminate against or
burden the interstate flow of articles of commerce.
64
Article I, section 9, of the U.S. Constitution provides that Congress shall pass “No Bill of Attainder or ex
post facto Law.” Similarly, Article I, section 10, of the U.S. Constitution prohibits the states from
enacting bills of attainder. The Supreme Court has described a bill of attainder as “a law that
legislatively determines guilt and inflicts punishment upon an identifiable individual without provision of
the protections of judicial trial.”
65
The International Emergency Economic Powers Act
The International Emergency Economic Powers Act (IEEPA) gives the President of the United States
regulatory authority over a variety of economic transactions in the event of a national emergency that
constitutes an unusual and extraordinary threat.
66
The IEEPA, like the Trading with the Enemy Act from
53
Arizona v. U.S., 567 U.S. 387, 399 (2012).
54
Crosby v. Nat’l. Foreign Trade Council, 530 U.S. at 372 (2000).
55
Nat’l Foreign Trade Council, Inc. v. Giannoulias, 523 F. Supp. 2d 731 (N.D. Ill. Feb. 23, 2007), quoting Hines v. Davidowitz, 312 U.S.
52, 67 (1941).
56
See, e.g., U.S. CONST., Art. I, s. 8 (power to declare war, maintain a military, and regulate foreign commerce); U.S. CONST., Art. II, s. 2
(power to enter into treaties); U.S. CONST., Art. III, s. 2 (power to hear case involving foreign states and citizens).
57
Zschernig v. Miller, 389 U.S. 429 (1968); American Ins. Ass’n. v. Garamendi, 539 U.S. 396 (2003) (finding that the President’s
powers in foreign policy were so great as to outweigh any need for a direct expression of preemption.)
58
Hines v. Davidowitz, 312 U.S. 52, 67 (1941).
59
Japan Line v. County of Los Angeles, 441 U.S. 434, 446 (1979).
60
See generally, Stephen Mulligan, Congressional Research Service, Constitutional Limits on States’ Power over Foreign Affairs, 3-4
(Aug. 15, 2022), available at https://crsreports.congress.gov/product/pdf/LSB/LSB10808 (last visited Feb. 2, 2024).
61
United States v. Davila-Mendoza, 972 F.3d 1264 (11th Cir. 2020).
62
“The premise […] is that the Commerce Clause analysis is identical, regardless of whether interstate or foreign commerce is involved.
This premise […] must be rejected. When construing Congress’ power to ‘regulate Commerce with foreign Nations,’ a more extensive
constitutional inquiry is required.” Japan Line at 446.
63
U.S. CONST., Art. I, s. 8
64
Or. Waste Sys., Inc. v. Dep’t of Envtl. Quality of Or., 511 U.S. 93, 98 (1994).
65
See Nixon v. Administrator of General Services, 433 U.S. 425 (1977).
66
See CRS, supra note 24. See also 50 U.S.C. § 1701. STORAGE NAME: h1541c.COM PAGE: 10
DATE: 2/23/2024
which it branched, sits at the center of the modern U.S. sanctions regime. As of September 1, 2023,
Presidents had declared 69 national emergencies invoking IEEPA, 39 of which are ongoing.
67
Executive Orders 13,873,
68
which prevents certain transactions with foreign adversaries, and 14,034,
which imposed a restriction on TikTok, invoked IEEPA authority in response to concerns about foreign
adversaries’ access to American digital data.
69
However, the executive branch withdrew Executive
Order 14,034 with specific IEEPA-based restrictions on TikTok.
70
Executive Order 13,873, references risks posed by foreign adversaries, which the order defines as any
foreign government or foreign person “engaged in a long-term pattern or serious instances of conduct
significantly adverse” to U.S. security or the safety of U.S. persons.
71
Subsequently, the Department of Commerce identified China (including Hong Kong), Cuba, Iran, North
Korea, Russia, and the Nicolás Maduro regime in Venezuela as foreign adversaries.
72
Effect of the Bill
The bill defines the following terms:
"Algorithm" has the same meaning as in s. 501.2041(1), F.S.
73
"Foreign-adversary-owned entity" or "entity" means a social media company that is more than
15 percent owned or controlled by nationals, governments, or corporations domiciled,
incorporated, or otherwise holding residence in a country designated as a foreign adversary.
74
The term "owned or controlled" means that a national, government, or corporation designated
as a foreign adversary has power:
o Over the election of the directors, or of individuals exercising similar functions, for the
entity; or
o To exercise influence over the management of the entity.
"Social or political advertising" means any advertisement on a social media platform that
discusses social or political issues or is intended to influence public opinion or electoral
outcomes.
The bill requires each foreign-adversary-owned entity operating a social media platform in Florida to:
Publicly disclose the core functional elements of the social media platform's content curation
and algorithms. Such disclosure must identify:
67
See Congressional Research Service, The International Emergency Economic Powers Act: Origins, Evolution, and Use (September
28, 2023), available at https://crsreports.congress.gov/product/pdf/R/R45618 (last visited Feb. 2, 2024).
68
The Supply Chain Rule implements Executive Orders 13873 and 14034, titled Securing the Information and Communications
Technology and Services Supply Chain (ICTS). Invoking National Emergencies Act (50 U.S.C. § 1601) and citing the International
Emergency Economic Powers Act (50 U.S.C. §1701), then-President Trump declared a national emergency because of the threat of
foreign adversaries exploiting vulnerabilities in ICTS. In response to this threat, Executive Order 13873 prohibits transactions involving
foreign-owned ICTS that present (1) an undue risk of sabotage or subversion to ICTS in the United States, (2) an undue risk of
catastrophic effects on the security or resiliency of critical infrastructure or the digital economy in the United States, or (3) an
unacceptable risk to U.S. national security or the security and safety of U.S. persons. The order delegates implementation to the
Department of Commerce. In June 2021, President Biden issued Executive Order 14034, which directed the Secretary of Commerce to
evaluate the risks posed by connected software applications, commonly called “apps.” The order identified additional criteria for
Commerce to consider when evaluating transactions involving apps under the Supply Chain Rule. Factors include the app’s capacity to
enable espionage and the sensitivity of data collected. In June 2023, Commerce published a final rule (88 FR 39353), effective July 17,
2023, that expressly includes apps in the definition of ICTS and adds app-specific risk factors to the Supply Chain Rule. See
Congressional Research Service, The Information and Communications Technology and Services (ICTS) Rule and Review Process
(June 22, 2023), available at https://crsreports.congress.gov/product/pdf/IF/IF11760 (last visited Feb. 2, 2024).
69
See Congressional Research Service, Montana’s TikTok Ban, an Injunction, and Pending Legal Actions (December 8, 2023),
available at
https://crsreports.congress.gov/product/pdf/LSB/LSB10972#:~:text=Commerce%20Clause%3A%20The%20court%20found,concept%2
0Montana%20did%20not%20co ntest (last visited Feb. 2, 2024).
70
Id.
71
Id.
72
15 CFR § 7.4.
73
Section 501.2041(1)(a), F.S. defines “algorithm” as a mathematical set of rules that specifies how a group of data behaves and that
will assist in ranking search results and maintaining order or that is used in sorting or ranking content or material based on relevancy or
other factors instead of using published time or chronological order of such content or material.
74
As defined in 15 C.F.R. s. 7.4. STORAGE NAME: h1541c.COM PAGE: 11
DATE: 2/23/2024
o The factors that influence content ranking and visibility.
o Measures taken to address misinformation and harmful content.
o The process of personalization and targeting of content.
Make publicly available the source code of its algorithms through an open-source license.
Implement a user verification system for each user and organization that purchases
advertisements concerning social or political issues.
o The system must verify key identifying information, including:
Citizenship,
Residency, and
Age of the user or the individuals that own the organization.
o Once verified, the identity of the purchaser of each social or political advertisement must
be disclosed with the advertisement.
The bill provides that a foreign-adversary-owned entity operating a social media platform that violates
the requirements of the bill is liable up to $10,000 for each discrete violation.
The bill requires DLA to enforce the bill.
The bill, titled the "Transparency in Social Media Act," makes the following findings:
Social media platforms play a significant role in shaping public discourse and opinion.
Algorithms used by social media platforms can influence user behavior and content visibility.
Transparency in the functioning of such algorithms and in political and social advertising is vital
for safeguarding democratic values and user privacy.
Ownership of social media platforms by foreign entities can raise concerns regarding foreign
influence and data security.
The bill provides an effective date of July 1, 2024.
B. SECTION DIRECTORY:
Section 1: Creates s. 501.20411, F.S.; related to requirements for certain social media companies.
Section 2: Provides an effective date.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
There may be an increase in civil penalties collected by DLA.
2. Expenditures:
There may be an increase of regulatory costs to DLA from enforcing the bill.
B. FISCAL IMPACT ON LOCAL GOVER NMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
Certain social media entities will need to implement new procedures for sharing certain algorithm
information, user verification, and advertisement disclosures. STORAGE NAME: h1541c.COM PAGE: 12
DATE: 2/23/2024
D. FISCAL COMMENTS:
None.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. The bill does not appear to affect county or municipal governments.
2. Other:
Freedom of Speech
It is well established that a government regulation based on the content of speech is presumptively
invalid and will be upheld only if it is necessary to advance a compelling governmental interest,
precisely tailored to serve that interest, and is the least restrictive means available for establishing
that interest.
75
The government bears the burden of demonstrating the constitutionality of any such
content-based regulation.
76
The United States Supreme Court has recognized that First Amendment protection extends to
corporations.
77
“This protection has been extended by explicit holdings to the context of political
speech.”
78
Under these precedents, it is well settled that political speech does not lose First
Amendment protection “simply because its source is a corporation.”
79
Generally, the government
may not require a corporation to host another’s speech absent a showing of a compelling state
interest.
80
Supremacy Clause
The U.S. Constitution’s Supremacy Clause establishes that federal statutes, treaties, and the U.S.
Constitution are the “supreme Law of the Land.”
81
Federal law may preempt state action that thwarts federal law in three ways:
By an express statement of its intent to occupy a field. Express preemption need not be total,
however—it can preempt all state laws or only certain state laws.
With “a framework of regulation so pervasive that Congress left no room for the States to
supplement it or where the federal interest is so dominant that the federal system will be
assumed to preclude enforcement of state laws on the same subject.”
82
Where state law conflicts, leaving an actor to choose whether to adhere to state or federal
law.
83
The state law may also be subject to conflict preemption where it “stands as an
obstacle to the accomplishment and execution of the full purposes and objectives of
Congress.”
84
75
Ashcroft 542 U.S. 656, at 665-66.
76
Ashcroft, 542 U.S. 656, at 660.
77
Citizens United, 558 U.S. 310, at 342.
78
Id.
79
Id.
80
Consolidated Edison Co., 447 U.S. 530; First National Bank of Boston, 438 U.S. 1978; Miami Herald Publishing Co., 418 U.S. 241;
Pacific Gas & Electric Co, 475 U.S.1.
81
U.S. CONST., Art. VI, cl. 2.
82
Arizona v. U.S., 567 U.S. 387, 399.
83
Crosby, 530 U.S. at 372.
84
Nat’l Foreign Trade Council, Inc., 523 F. Supp. 2d 731. STORAGE NAME: h1541c.COM PAGE: 13
DATE: 2/23/2024
The federal government’s authority to act in the realm of foreign affairs is vested by the U.S.
Constitution.
85
State laws that intrude into this field of foreign affairs, even where not preempted by
prior federal action, improperly impact foreign affairs and are therefore invalid.
86
Courts have
generally held, however, that the state’s intrusion must have more than an “incidental effect” on
foreign affairs in order to be considered an encroachment onto the federal government’s powers.
87
Article I, section 8, clause 3 of the U.S. Constitution grants Congress the power to “regulate
commerce with foreign nations ....” Conversely, this provision serves as a limitation on states’
authority to encroach onto the realm of foreign commerce where such action creates a risk of
conflicts with foreign governments or impedes the federal government’s ability to speak with one
voice in regulating industry affairs with foreign states.
88
The “dormant foreign commerce power”
89
voids state acts upon foreign commerce because of the Constitution's overriding concern for national
uniformity in foreign commerce—even in instances when Congress has not affirmatively acted.
90
Courts also generally subject state action to a heightened scrutiny that assumes the supremacy of
federal action in the realm of foreign relations.
91
Additionally, Section 230 of the federal Communications Decency Act (CDA),
92
in part, specifies that
“[n]o provider ... of an interactive computer service shall be treated as the publisher or speaker of
any information provided by another information content provider”
93
and specifically prohibits all
inconsistent causes of action and liability imposed under any State or local law.
94
Contracts
Article I, Section 10 of the United States Constitution prohibits a state from passing any law impairing
the obligation of contracts. Article I, Section 10 of the Florida Constitution also prohibits the passage
of laws impairing the obligation of contracts.
B. RULE-MAKING AUTHORITY:
There is no allowance for DLA to adopt rule pursuant to the bill.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES
On February 6, 2024, the Regulatory Reform & Economic Development Subcommittee adopted an
amendment and reported the bill favorably as a committee substitute. The committee substitute:
Provides a definition for “control” and “own,” to mean that a foreign adversary has power:
o Over the election of the directors, or of individuals exercising similar functions, for the entity;
or
o To exercise influence over the management of the entity.
Provides that a foreign adversary must have 15 percent ownership or control over the social media
company to be a foreign-adversary-owned entity.
85
See, e.g., U.S. CONST., Art. I, s. 8; U.S. CONST., Art. II, s. 2; U.S. CONST., Art. III, s. 2.
86
Zschernig, 389 U.S. 429; American Ins. Ass’n., 539 U.S. 396.
87
Hines, 312 U.S. 52, at 67.
88
Japan Line, 441 U.S. 434, at 446.
89
See generally, Stephen Mulligan, Congressional Research Service, Constitutional Limits on States’ Power over Foreign Affairs, 3-4
(Aug. 15, 2022), available at https://crsreports.congress.gov/product/pdf/LSB/LSB10808 (last visited Feb. 2, 2024).
90
United States v. Davila-Mendoza, 972 F.3d 1264.
91
“The premise […] is that the Commerce Clause analysis is identical, regardless of whether interstate or foreign commerce is involved.
This premise […] must be rejected. When construing Congress’ power to ‘regulate Commerce with foreign Nations,’ a more extensive
constitutional inquiry is required.” Japan Line, 441 U.S. 434,at 446.
92
Force, 934 F.3d at 63.
93
47 U.S.C. § 230(c)(1).
94
47 U.S.C. § 230(e). STORAGE NAME: h1541c.COM PAGE: 14
DATE: 2/23/2024
This analysis is drafted to the committee substitute as passed by the Regulatory Reform & Economic
Development Subcommittee.