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AN ACT relating to consumer data privacy. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 3
READ AS FOLLOWS: 4
As used in Sections 1 to 10 of this Act: 5
(1) "Affiliate" means a legal entity that controls, is controlled by, or is under 6
common control with another legal entity or shares common branding with 7
another legal entity. For the purposes of this definition, "control" or 8
"controlled" means: 9
(a) Ownership of, or the power to vote, more than fifty percent (50%) of the 10
outstanding shares of any class of voting security of a company; 11
(b) Control in any manner over the election of a majority of the directors or of 12
individuals exercising similar functions; or 13
(c) The power to exercise controlling influence over the management of a 14
company; 15
(2) "Authenticate" means verifying through reasonable means that the consumer 16
entitled to exercise his or her consumer rights in Section 3 of this Act is the same 17
consumer exercising such consumer rights with respect to the personal data at 18
issue; 19
(3) "Biometric data" means data generated by automatic measurements of an 20
individual's biological characteristics, such as a fingerprint, voiceprint, eye 21
retinas, irises, or other unique biological patterns or characteristics that are used 22
to identify a specific individual but does not include a physical or digital 23
photograph, a video or audio recording or data generated therefrom, or 24
information collected, used, or stored for health care treatment, payment, or 25
operations under HIPAA; 26
(4) "Business associate" has the same meaning as established in 45 C.F.R. sec. 27 UNOFFICIAL COPY 23 RS BR 1402
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160.103 pursuant to HIPPA; 1
(5) "Child" means any natural person eighteen (18) years of age or younger; 2
(6) "Consent" means a clear affirmative act signifying a consumer's freely given, 3
specific, informed, and unambiguous agreement to process personal data relating 4
to the consumer and may include a written statement, including a statement 5
written by electronic means, or any other unambiguous affirmative action; 6
(7) "Consumer" means a natural person who is a resident of Kentucky acting only in 7
an individual or household context but does not include a natural person acting 8
in a commercial or employment context; 9
(8) "Controller" means a natural or legal person that, alone or jointly with others, 10
determines the purpose and means of processing personal data; 11
(9) "Covered entity" has the same meaning as established in 45 C.F.R. sec. 160.103 12
pursuant to HIPPA; 13
(10) "De-identified data" means data that cannot be reasonably linked to an identified 14
or identifiable natural person, provided that a controller that possesses de-15
identified data takes reasonable measures to ensure that the data cannot be 16
associated with a natural person; 17
(11) "Fund" means the consumer privacy fund established in Section 9 of this Act; 18
(12) "Health record" means a record, other than for financial or billing purposes, 19
relating to an individual, kept by a health care provider as a result of the 20
professional relationship established between the health care provider and the 21
individual; 22
(13) "Health care provider" means: 23
(a) Any health facility as defined in KRS 216B.015; 24
(b) Any person or entity providing health care or health services, including 25
those licensed, certified, or registered under, or subject to, KRS 194A.700 to 26
194A.729 or KRS Chapter 310, 311, 311A, 311B, 312, 313, 314, 314A, 315, 27 UNOFFICIAL COPY 23 RS BR 1402
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319, 319A, 319B, 319C, 320, 327, 333, 334A, or 335; 1
(c) The current and former employers, officers, directors, administrators, 2
agents, or employees of those entities listed in paragraphs (a) and (b) of this 3
subsection; or 4
(d) Any person acting within the course and scope of his or her office, 5
employment, or agency relating to a health care provider; 6
(14) "HIPAA" means the federal Health Insurance Portability and Accountability Act 7
of 1996, Pub. L. No. 104-191; 8
(15) "Identified or identifiable natural person" means a person who can be readily 9
identified directly or indirectly; 10
(16) "Institution of higher education" means an educational institution which: 11
(a) Admits as regular students only individuals having a certificate of 12
graduation from a high school, or the recognized equivalent of such a 13
certificate; 14
(b) Is legally authorized in this state to provide a program of education beyond 15
high school; 16
(c) Provides an educational program for which it awards a bachelor's or higher 17
degree, or provides a program which is acceptable for full credit toward 18
such a degree, a program of postgraduate or postdoctoral studies, or a 19
program of training to prepare students for gainful employment in a 20
recognized occupation; and 21
(d) Is a public or other nonprofit institution; 22
(17) "Nonprofit organization" means an incorporated or unincorporated entity that: 23
(a) Is operating for religious, charitable, or educational purposes; and 24
(b) Does not provide net earnings to, or operate in any manner that inures to 25
the benefit of, any officer, employee, or shareholder of the entity; 26
(18) "Personal data" means information that is linked or reasonably linkable to an 27 UNOFFICIAL COPY 23 RS BR 1402
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identified or identifiable natural person but does not include de-identified data or 1
publicly available information; 2
(19) "Precise geolocation data" means information derived from technology, 3
including but not limited to global positioning system level latitude and longitude 4
coordinates or other mechanisms, that directly identifies the specific location of a 5
natural person with precision and accuracy within a radius of one thousand 6
seven hundred fifty (1,750) feet but does not include the content of 7
communications or any data generated by or connected to advanced utility 8
metering infrastructure systems or equipment for use by a utility; 9
(20) "Process" or "processing" means any operation or set of operations performed, 10
whether by manual or automated means, on personal data or on sets of personal 11
data, such as the collection, use, storage, disclosure, analysis, deletion, or 12
modification of personal data; 13
(21) "Processor" means a natural or legal entity that processes personal data on 14
behalf of a controller; 15
(22) "Protected health information" means the same as established in 45 C.F.R. sec. 16
160.103 pursuant to HIPPA; 17
(23) "Pseudonymous data" means personal data that cannot be attributed to a specific 18
natural person without the use of additional information, provided that such 19
additional information is kept separately and is subject to appropriate technical 20
and organizational measures to ensure that the personal data is not attributed to 21
an identified or identifiable natural person; 22
(24) "Publicly available information" means information that is lawfully made 23
available through federal, state, or local government records, or information that 24
a business has a reasonable basis to believe is lawfully made available to the 25
general public through widely distributed media, by the consumer, or by a person 26
to whom the consumer has disclosed the information, unless the consumer has 27 UNOFFICIAL COPY 23 RS BR 1402
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restricted the information to a specific audience; 1
(25) "Sale of personal data" means the exchange of personal data for monetary 2
consideration by the controller to a third party, but does not include: 3
(a) The disclosure of personal data to a processor that processes the personal 4
data on behalf of the controller; 5
(b) The disclosure of personal data to a third party for purposes of providing a 6
product or service requested by the consumer; 7
(c) The disclosure or transfer of personal data to an affiliate of the controller; 8
(d) The disclosure of information that the consumer intentionally made 9
available to the general public via a channel of mass media and did not 10
restrict to a specific audience; 11
(e) The disclosure or transfer of personal data when a consumer uses or directs 12
a controller to intentionally disclose personal data or intentionally interact 13
with one (1) or more third parties; or 14
(f) The disclosure or transfer of personal data to a third party as an asset that 15
is part of a proposed or actual merger, acquisition, bankruptcy, or other 16
transaction in which the third party assumes control of all or part of the 17
controller's assets; 18
(26) "Sensitive data" means a category of personal data that includes: 19
(a) Racial or ethnic origin, religious beliefs, mental or physical health 20
diagnosis, sexual orientation, or citizenship or immigration status, except to 21
the extent such data is used in order to avoid discrimination on the basis of 22
a protected class that would violate a federal or state antidiscrimination law; 23
(b) Genetic or biometric data that is processed for the purpose of uniquely 24
identifying a specific natural person; 25
(c) The personal data collected from a known child; or 26
(d) Precise geolocation data; 27 UNOFFICIAL COPY 23 RS BR 1402
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(27) "State agency" means all departments, offices, commissions, boards, institutions, 1
and political and corporate bodies of the state, including the offices of the clerk of 2
the Supreme Court, clerks of the appellate courts, the several courts of the state, 3
and the legislature, its committees, or commissions; 4
(28) "Targeted advertising" means displaying advertisements to a consumer where the 5
advertisement is selected based on personal data obtained from that consumer's 6
activities over time and across nonaffiliated websites or online applications to 7
predict that consumer's preferences or interests. "Targeted advertising" does not 8
include: 9
(a) Advertisements based on activities within a controller's own or affiliated 10
websites or online applications; 11
(b) Advertisements based on the context of a consumer's current search query, 12
visit to a website, or online application; 13
(c) Advertisements directed to a consumer in response to the consumer's 14
request for information or feedback; or 15
(d) Processing personal data solely for measuring or reporting advertising 16
performance, reach, or frequency; 17
(29) "Third party" means a natural or legal person, public authority, agency, or body 18
other than the consumer, controller, processor, or an affiliate of the processor or 19
the controller; and 20
(30) "Trade secret" means information, including but not limited to a formula, 21
pattern, compilation, program, device, method, technique, or process, that: 22
(a) Derives independent economic value, actual or potential, from not being 23
generally known to, and not being readily ascertainable by proper means by, 24
other persons who can obtain economic value from its disclosure or use; 25
and 26
(b) Is the subject of efforts that are reasonable under the circumstances to 27 UNOFFICIAL COPY 23 RS BR 1402
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maintain its secrecy. 1
SECTION 2. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 2
READ AS FOLLOWS: 3
(1) Sections 1 to 10 of this Act apply to persons that conduct business in this state or 4
produce products or services that are targeted to residents of this state and that 5
during a calendar year control or process personal data of at least: 6
(a) One hundred thousand (100,000) consumers; or 7
(b) Twenty-five thousand (25,000) consumers and derive over fifty percent 8
(50%) of gross revenue from the sale of personal data. 9
(2) Sections 1 to 10 of this Act shall not apply to any: 10
(a) State agency or any political subdivision of the state; 11
(b) Financial institutions or data subject to Title V of the federal Gramm-12
Leach-Bliley Act, 15 U.S.C. sec. 6801 et seq.; 13
(c) Covered entity or business associate governed by the privacy, security, and 14
breach notification rules issued by the United States Department of Health 15
and Human Services, 45 C.F.R. pts. 160 and 164 established pursuant to 16
HIPAA; 17
(d) Nonprofit organization; or 18
(e) Institution of higher education. 19
(3) The following information and data are exempt from Sections 1 to 10 of this Act: 20
(a) Protected health information under HIPPA; 21
(b) Health records; 22
(c) Patient identifying information for purposes of 42 C.F.R. sec. 2.11; 23
(d) Identifiable private information for purposes of the federal policy for the 24
protection of human subjects under 45 C.F.R. pt. 46; identifiable private 25
information that is otherwise information collected as part of human 26
subjects research pursuant to the good clinical practice guidelines issued by 27 UNOFFICIAL COPY 23 RS BR 1402
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the International Council for Harmonisation of Technical Requirements 1
for Pharmaceuticals for Human Use; the protection of human subjects 2
under 21 C.F.R. pts. 50 and 56, or personal data used or shared in research 3
conducted in accordance with the requirements set forth in Sections 1 to 10 4
of this Act, or other research conducted in accordance with applicable law; 5
(e) Information and documents created for purposes of the federal Health Care 6
Quality Improvement Act of 1986, 42 U.S.C. sec. 11101 et seq.; 7
(f) Patient safety work product for purposes of the federal Patient Safety and 8
Quality Improvement Act, 42 U.S.C. sec. 299b-21 et seq.; 9
(g) Information derived from any of the health care-related information listed 10
in this subsection that is de-identified in accordance with the requirements 11
for de-identification pursuant to HIPAA; 12
(h) Information originating from, and intermingled to be indistinguishable 13
from, or information treated in the same manner as information exempt 14
under this subsection that is maintained by a covered entity or business 15
associate, or a program or qualified service organization as defined by 42 16
C.F.R. sec. 2.11; 17
(i) Information used only for public health activities and purposes as 18
authorized by HIPAA; 19
(j) The collection, maintenance, disclosure, sale, communication, or use of any 20
personal information bearing on a consumer's creditworthiness, credit 21
standing, credit capacity, character, general reputation, personal 22
characteristics, or mode of living by a consumer reporting agency, 23
furnisher, or user that provides information for use in a consumer report, 24
and by a user of a consumer report, but only to the extent that such activity 25
is regulated by and authorized under the federal Fair Credit Reporting Act, 26
15 U.S.C. sec. 1681 et seq.; 27 UNOFFICIAL COPY 23 RS BR 1402
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(k) Personal data collected, processed, sold, or disclosed in compliance with the 1
federal Driver's Privacy Protection Act of 1994, 18 U.S.C. sec. 2721 et seq.; 2
(l) Personal data regulated by the federal Family Educational Rights and 3
Privacy Act, 20 U.S.C. sec. 1232g et seq.; 4
(m) Personal data collected, processed, sold, or disclosed in compliance with the 5
federal Farm Credit Act, 12 U.S.C. sec. 2001 et seq.; and 6
(n) Data processed or maintained: 7
1. In the course of an individual applying to, employed by, or acting as 8
an agent or independent contractor of a controller, processor, or third 9
party, to the extent that the data is collected and used within the 10
context of that role; 11
2. As the emergency contact information of an individual used for 12
emergency contact purposes; or 13
3. That is necessary to retain to administer benefits for another 14
individual relating to the individual under subparagraph 1. of this 15
paragraph and used for the purposes of administering those benefits. 16
(4) Controllers and processors that comply with the verifiable parental consent 17
requirements of the Children's Online Privacy Protection Act, 15 U.S.C. sec. 18
6501 et seq., shall be deemed compliant with any obligation to obtain parental 19
consent under Sections 1 to 10 of this Act. 20
SECTION 3. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 21
READ AS FOLLOWS: 22
(1) A consumer may invoke the consumer rights authorized pursuant to this section 23
at any time by submitting a request to a controller, via the means specified by the 24
controller pursuant to Section 4 of this Act, specifying the consumer rights the 25
consumer wishes to invoke. A known child's parent or legal guardian may invoke 26
such consumer rights on behalf of the child regarding processing personal data 27 UNOFFICIAL COPY 23 RS BR 1402
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belonging to the known child. 1
(2) A controller shall comply with an authenticated consumer request to exercise the 2
right to: 3
(a) Confirm whether or not a controller is processing the consumer's personal 4
data and to access such personal data; 5
(b) Delete personal data provided by the consumer; 6
(c) Obtain a copy of the consumer's personal data that the consumer previously 7
provided to the controller in a portable and, to the extent technically 8
practicable, readily usable format that allows the consumer to transmit the 9
data to another controller without hindrance, where the processing is 10
carried out by automated means; and 11
(d) To opt out of targeted advertising and the sale of personal data. 12
(3) Except as otherwise provided in Sections 1 to 10 of this Act, a controller shall 13
comply with a request by a consumer to exercise the consumer rights pursuant to 14
this section as follows: 15
(a) A controller shall respond to the consumer without undue delay, but in all 16
cases within forty-five (45) days of receipt of the request submitted pursuant 17
to the methods described in this section. The response period may be 18
extended once by forty-five (45) additional days when reasonably necessary, 19
taking into account the complexity and number of the consumer's requests, 20
so long as the controller informs the consumer of any such extension within 21
the initial forty-five (45) day response period, together with the reason for 22
the extension; 23
(b) If a controller declines to take action regarding the consumer's request, the 24
controller shall inform the consumer without undue delay, but in all cases 25
within forty-five (45) days of receipt of the request, of the justification for 26
declining to take action; 27 UNOFFICIAL COPY 23 RS BR 1402
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(c) Information provided in response to a consumer request shall be provided 1
by a controller free of charge, up to twice annually per consumer. If 2
requests from a consumer are excessive, repetitive, technically infeasible, or 3
manifestly unfounded, such as when the controller reasonably believes that 4
the primary purpose of the request is not to exercise a consumer right, the 5
controller may charge the consumer a reasonable fee to cover the 6
administrative costs of complying with the request or decline to act on the 7
request. The controller bears the burden of demonstrating the excessive, 8
repetitive, technically infeasible, or manifestly unfounded nature of the 9
request; and 10
(d) If a controller is unable to authenticate the request using commercially 11
reasonable efforts, the controller shall not be required to comply with a 12
request to initiate an action under subsection (1) of this section and may 13
request that the consumer provide additional information reasonably 14
necessary to authenticate the consumer and the consumer's request. 15
SECTION 4. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 16
READ AS FOLLOWS: 17
(1) A controller shall: 18
(a) Establish, implement, and maintain reasonable administrative, technical, 19
and physical data security practices to protect the confidentiality, integrity, 20
and accessibility of personal data. Such data security practices shall be 21
appropriate to the volume and nature of the personal data at issue; 22
(b) Not process personal data in violation of state and federal laws that prohibit 23
unlawful discrimination against consumers. A controller shall not 24
discriminate against a consumer for exercising any of the consumer rights 25
contained in Section 3 of this Act, including denying goods or services, 26
charging different prices or rates for goods or services, or providing a 27 UNOFFICIAL COPY 23 RS BR 1402
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different level of quality of goods and services to the consumer. However, 1
nothing in this paragraph shall be construed to require a controller to 2
provide a product or service that requires the personal data of a consumer 3
that the controller does not collect or maintain or to prohibit a controller 4
from offering a different price, rate, level, quality, or selection of goods or 5
services to a consumer, including offering goods or services for no fee, if 6
the consumer has exercised his right to opt out pursuant to Section 3 of this 7
Act or the offer is related to a consumer's voluntary participation in a bona 8
fide loyalty, rewards, premium features, discounts, or club card program; 9
and 10
(c) Not process sensitive data concerning a consumer for a nonexempt purpose 11
without the consumer having been presented with clear notice and an 12
opportunity to opt out of such processing, or, in the case of the processing 13
of sensitive data collected from a known child, for purposes of delivering a 14
product or service requested by the parent of such child, without processing 15
the data in accordance with the federal Children's Online Privacy 16
Protection Act 15 U.S.C. sec. 6501 et seq. 17
(2) Any provision of a contract or agreement of any kind that purports to waive or 18
limit in any way consumer rights pursuant to Section 3 of this Act shall be 19
deemed contrary to public policy and shall be void and unenforceable. 20
(3) Controllers shall provide consumers with a reasonably accessible, clear, and 21
meaningful privacy notice that includes: 22
(a) The categories of personal data processed by the controller; 23
(b) The purpose for processing personal data; 24
(c) How consumers may exercise their consumer rights pursuant to Section 3 25
of this Act; 26
(d) The categories of personal data that the controller shares with third parties, 27 UNOFFICIAL COPY 23 RS BR 1402
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if any; and 1
(e) The categories of third parties, if any, with whom the controller shares 2
personal data. 3
(4) If a controller sells personal data to third parties or engages in targeted 4
advertising, the controller shall clearly and conspicuously disclose such activity, 5
as well as the manner in which a consumer may exercise the right to opt out of 6
such processing. 7
(5) A controller shall establish, and shall describe in a privacy notice, one (1) or 8
more secure and reliable means for consumers to submit a request to exercise 9
their consumer rights under Section 3 of this Act. Such means shall take into 10
account the ways in which consumers normally interact with the controller, the 11
need for secure and reliable communication of such requests, and the ability of 12
the controller to authenticate the identity of the consumer making the request. 13
Controllers shall not require a consumer to create a new account in order to 14
exercise consumer rights pursuant to Section 3 of this Act but may require a 15
consumer to use an existing account. 16
SECTION 5. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 17
READ AS FOLLOWS: 18
(1) A processor shall adhere to the instructions of a controller and shall assist the 19
controller in meeting its obligations under Section 1 to 10 of this Act. Such 20
assistance shall include: 21
(a) Taking into account the nature of processing and the information available 22
to the processor, by appropriate technical and organizational measures, 23
insofar as this is reasonably practicable, to fulfill the controller's obligation 24
to respond to consumer rights requests pursuant to Section 3 of this Act; 25
and 26
(b) Taking into account the nature of processing and the information available 27 UNOFFICIAL COPY 23 RS BR 1402
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to the processor, by assisting the controller in meeting the controller's 1
obligations in relation to the security of processing the personal data and in 2
relation to the notification of a breach of the security of the system of the 3
processor pursuant to KRS 365.732 or any other applicable state and 4
federal law in order to meet the controller's obligations. 5
(2) A contract between a controller and a processor shall govern the processor's data 6
processing procedures with respect to processing performed on behalf of the 7
controller. The contract shall be binding and shall clearly set forth instructions 8
for processing personal data, the nature and purpose of processing, the type of 9
data subject to processing, the duration of processing, and the rights and 10
obligations of both parties. The contract shall also include requirements that the 11
processor shall: 12
(a) Ensure that each person processing personal data is subject to a duty of 13
confidentiality with respect to the data; 14
(b) At the controller's direction, delete or return all personal data to the 15
controller as requested at the end of the provision of services, unless 16
retention of the personal data is required by law; 17
(c) Upon the reasonable request of the controller, make available to the 18
controller information in its possession necessary to demonstrate the 19
processor's compliance with the obligations prescribed in Sections 1 to 10 of 20
this Act; and 21
(d) Engage any subcontractor pursuant to a written contract in accordance 22
with this section that requires the subcontractor to meet the obligations of 23
the processor with respect to the personal data. 24
(3) Determining whether a person is acting as a controller or processor with respect 25
to a specific processing of data is a fact-based determination that depends upon 26
the context in which personal data is to be processed. A processor that continues 27 UNOFFICIAL COPY 23 RS BR 1402
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to adhere to a controller's instructions with respect to a specific processing of 1
personal data remains a processor. 2
SECTION 6. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 3
READ AS FOLLOWS: 4
(1) Nothing in Sections 1 to 10 of this Act shall be construed to require a controller 5
or processor to: 6
(a) Re-identify de-identified data or pseudonymous data; or 7
(b) Maintain data in identifiable form, or collect, obtain, retain, or access any 8
data or technology, in order to be capable of associating an authenticated 9
consumer request with personal data. 10
(2) Nothing in Sections 1 to 10 of this Act shall be construed to require a controller 11
or processor to comply with an authenticated consumer rights request pursuant to 12
Section 3 of this Act if all of the following are met: 13
(a) The controller is not reasonably capable of associating the request with the 14
personal data or it would be unreasonably burdensome for the controller to 15
associate the request with the personal data; 16
(b) The controller does not use the personal data to recognize or respond to the 17
specific consumer who is the subject of the personal data, or associate the 18
personal data with other personal data about the same specific consumer; 19
and 20
(c) The controller does not sell the personal data to any third party or otherwise 21
voluntarily disclose the personal data to any third party other than a 22
processor, except as otherwise permitted in this section. 23
(3) The consumer rights contained in subsection (2) of Section 3 of this Act and 24
Section 4 of this Act shall not apply to pseudonymous data in cases where the 25
controller is able to demonstrate any information necessary to identify the 26
consumer is kept separately and is subject to appropriate technical and 27 UNOFFICIAL COPY 23 RS BR 1402
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organizational measures to ensure that the personal data is not attributed to an 1
identified or identifiable natural person. 2
(4) A controller that discloses pseudonymous data or de-identified data shall exercise 3
reasonable oversight to monitor compliance with any contractual commitments to 4
which the pseudonymous data or de-identified data is subject and shall take 5
appropriate steps to address any breaches of those contractual commitments. 6
SECTION 7. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 7
READ AS FOLLOWS: 8
(1) Nothing Sections 1 to 10 of this Act shall be construed to restrict a controller's or 9
processor's ability to: 10
(a) Comply with federal, state, or local laws or regulations; 11
(b) Comply with a civil, criminal, or regulatory inquiry, investigation, 12
subpoena, or summons by federal, state, local, or other governmental 13
authorities; 14
(c) Cooperate with law enforcement agencies concerning conduct or activity 15
that the controller or processor reasonably and in good faith believes may 16
violate federal, state, or local laws, rules, or regulations; 17
(d) Investigate, establish, exercise, prepare for, or defend legal claims; 18
(e) Provide a product or service specifically requested by a consumer or a 19
parent or guardian of a child, perform a contract to which the consumer or 20
parent or guardian of a child is a party, including fulfilling the terms of a 21
written warranty, or take steps at the request of the consumer or parent or 22
guardian of a child prior to entering into a contract; 23
(f) Take immediate steps to protect an interest that is essential for the life or 24
physical safety of the consumer or of another natural person, and where the 25
processing cannot be manifestly based on another legal basis; 26
(g) Prevent, detect, protect against, or respond to security incidents, identity 27 UNOFFICIAL COPY 23 RS BR 1402
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theft, fraud, harassment, malicious or deceptive activities, or any illegal 1
activity; preserve the integrity or security of systems; or investigate, report, 2
or prosecute those responsible for any such action; 3
(h) Engage in public or peer-reviewed scientific or statistical research in the 4
public interest that adheres to all other applicable ethics and privacy laws 5
and is approved, monitored, and governed by an institutional review board, 6
or similar independent oversight entities that determine: 7
1. If the information is likely to provide substantial benefits that do not 8
exclusively accrue to the controller; 9
2. The expected benefits of the research outweigh the privacy risks; and 10
3. If the controller has implemented reasonable safeguards to mitigate 11
privacy risks associated with research, including any risks associated 12
with re-identification; or 13
(i) Assist another controller, processor, or third party with any of the 14
obligations under this subsection. 15
(2) The obligations imposed on controllers or processors under Sections 1 to 10 of 16
this Act shall not restrict a controller's or processor's ability to collect, use, or 17
retain data to: 18
(a) Conduct internal research to develop, improve, or repair products, services, 19
or technology; 20
(b) Effectuate a product recall; 21
(c) Identify and repair technical errors that impair existing or intended 22
functionality; or 23
(d) Perform internal operations that are reasonably aligned with the 24
expectations of the consumer or reasonably anticipated based on the 25
consumer's existing relationship with the controller or are otherwise 26
compatible with processing data in furtherance of the provision of a product 27 UNOFFICIAL COPY 23 RS BR 1402
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or service specifically requested by a consumer or a parent or guardian of 1
child or the performance of a contract to which the consumer or a parent or 2
guardian of a child is a party. 3
(3) The obligations imposed on controllers or processors under Sections 1 to 10 of 4
this Act shall not apply if compliance by the controller or processor with Sections 5
1 to 10 of this Act would violate an evidentiary privilege under the laws of this 6
Commonwealth. Nothing in Sections 1 to 10 of this Act shall be construed to 7
prevent a controller or processor from providing personal data concerning a 8
consumer to a person covered by an evidentiary privilege under the laws of this 9
Commonwealth as part of a privileged communication. 10
(4) A controller or processor that discloses personal data to a third-party controller 11
or processor in compliance with the requirements of Sections 1 to 10 of this Act is 12
not in violation of Sections 1 to 10 of this Act if the third-party controller or 13
processor that receives and processes such personal data is in violation of 14
Sections 1 to 10 of this Act, provided that, at the time of disclosing the personal 15
data, the disclosing controller or processor did not have actual knowledge that the 16
recipient intended to commit a violation. A third-party controller or processor 17
receiving personal data from a controller or processor in compliance with the 18
requirements of Sections 1 to 10 of this Act is likewise not in violation of Sections 19
1 to 10 of this Act for the transgressions of the controller or processor from which 20
it receives such personal data. 21
(5) Nothing in Sections 1 to 10 of this Act shall be construed as an obligation 22
imposed on controllers and processors that adversely affects the privacy or other 23
rights or freedoms of any persons, such as exercising the right of free speech 24
pursuant to the First Amendment to the United States Constitution, or applies to 25
personal data by a person in the course of a purely personal or household 26
activity. 27 UNOFFICIAL COPY 23 RS BR 1402
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(6) Personal data processed by a controller pursuant to this section shall not be 1
processed for any purpose other than those expressly listed in this section unless 2
otherwise allowed by Sections 1 to 10 of this Act. Personal data processed by a 3
controller pursuant to this section may be processed to the extent that such 4
processing is: 5
(a) Reasonably necessary and proportionate to the purposes listed in this 6
section; and 7
(b) Adequate, relevant, and limited to what is necessary in relation to the 8
specific purposes listed in this section. Personal data collected, used, or 9
retained pursuant to subsection (2) of this section shall, where applicable, 10
take into account the nature and purpose or purposes of such collection, 11
use, or retention. Such data shall be subject to reasonable administrative, 12
technical, and physical measures to protect the confidentiality, integrity, 13
and accessibility of the personal data. 14
(7) If a controller processes personal data pursuant to an exemption in this section, 15
the controller bears the burden of demonstrating that such processing qualifies 16
for the exemption and complies with the requirements in this section. 17
(8) Processing personal data for the purposes expressly identified in subsection (1) of 18
this section shall not by itself make an entity a controller with respect to such 19
processing. 20
(9) Nothing in Sections 1 to 10 of this Act shall require a controller, processor, third 21
party, or consumer to disclose trade secrets. 22
SECTION 8. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 23
READ AS FOLLOWS: 24
(1) The Attorney General shall have exclusive authority to enforce violations of 25
Sections 1 to 10 of this Act. The Attorney General may enforce Sections 1 to 10 of 26
this Act by bringing an action in the name of the Commonwealth of Kentucky or 27 UNOFFICIAL COPY 23 RS BR 1402
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on behalf of persons residing in this Commonwealth. The Attorney General may 1
issue a civil investigative demand to any controller or processor believed to be 2
engaged in, or about to engage in, any violation of Sections 1 to 10 of this Act. 3
(2) Prior to initiating any action under Sections 1 to 10 of this Act, the Attorney 4
General shall provide a controller or processor thirty (30) days' written notice 5
identifying the specific provisions of Sections 1 to 10 of this Act the Attorney 6
General, on behalf of a consumer, alleges have been or are being violated. If 7
within the thirty (30) days the controller or processor cures the noticed violation 8
and provides the Attorney General an express written statement that the alleged 9
violations have been cured and that no further violations shall occur, no action 10
for statutory damages shall be initiated against the controller or processor. 11
(3) If a controller or processor continues to violate Sections 1 to 10 of this Act in 12
breach of an express written statement provided to the consumer under this 13
section, the Attorney General may initiate an action and seek damages for up to 14
seven thousand five hundred dollars ($7,500) for each such continued violation 15
under Sections 1 to 10 of this Act. 16
(4) Nothing in Sections 1 to 10 of this Act or under any other law, regulation, or the 17
equivalent shall be construed as providing the basis for, or be subject to, a private 18
right of action for violations of Sections 1 to 10 of this Act. 19
(5) The Attorney General may recover reasonable expenses incurred in investigating 20
and preparing the case, including attorney's fees, of any action initiated under 21
Sections 1 to 10 of this Act. 22
SECTION 9. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 23
READ AS FOLLOWS: 24
There is hereby created a trust and agency account to be known as the consumer 25
privacy fund. The fund shall be administered by the Office of the Attorney General. All 26
civil penalties collected pursuant to Sections 1 to 10 of this Act shall be deposited into 27 UNOFFICIAL COPY 23 RS BR 1402
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the fund. Interest earned on moneys in the fund shall accrue to the fund. Moneys in 1
the fund shall be used by the Office of the Attorney General to enforce Sections 1 to 10 2
of this Act. Notwithstanding KRS 45.229, any moneys remaining in the fund at the 3
close of the fiscal year shall not lapse but shall be carried forward into the succeeding 4
fiscal year to be used by the Office of the Attorney General for the purposes set forth in 5
Sections 1 to 10 of this Act. 6
SECTION 10. A NEW SECTION OF KRS CHAPTER 367 IS CREATED TO 7
READ AS FOLLOWS: 8
(1) The provisions of Sections 1 to 10 of this Act are a matter of statewide concern 9
and supersede and preempt all rules, regulations, codes, ordinances, and other 10
laws adopted by a city, county, city and county, municipality, or local agency 11
regarding the processing of personal data by controllers or processors. 12
(2) Any reference to federal, state, or local law or statute in Sections 1 to 10 of this 13
Act shall be deemed to include any accompanying rules or regulations or 14
exemptions thereto. Further, this enactment is declaratory of existing law. 15
Section 11. KRS 367.240 is amended to read as follows: 16
(1) When the Attorney General has reason to believe that a person has engaged in, is 17
engaging in, or is about to engage in any act or practice declared to be unlawful by 18
KRS 367.110 to 367.300 or Sections 1 to 10 of this Act, or when he believes it to 19
be in the public interest that an investigation should be made to ascertain whether a 20
person in fact has engaged in, is engaging in or is about to engage in, any act or 21
practice declared to be unlawful by KRS 367.110 to 367.300 or Sections 1 to 10 of 22
this Act, he may execute in writing and cause to be served upon any person who is 23
believed to have information, documentary material or physical evidence relevant 24
to the alleged or suspected violation, an investigative demand requiring such person 25
to furnish, under oath or otherwise, a report in writing setting forth the relevant 26
facts and circumstances of which he has knowledge, or to appear and testify or to 27 UNOFFICIAL COPY 23 RS BR 1402
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produce relevant documentary material or physical evidence for examination, at 1
such reasonable time and place as may be stated in the investigative demand, 2
concerning the advertisement, sale or offering for sale of any goods or services or 3
the conduct of any trade or commerce that is the subject matter of the investigation. 4
Provided however, that no person who has a place of business in Kentucky shall be 5
required to appear or present documentary material or physical evidence outside of 6
the county where he has his principal place of business within the Commonwealth. 7
(2) At any time before the return date specified in an investigative demand, or within 8
twenty (20) days after the demand has been served, whichever period is shorter, a 9
petition to extend the return date, or to modify or set aside the demand, stating good 10
cause, may be filed in the Circuit Court where the person served with the demand 11
resides or has his principal place of business or in the Franklin Circuit Court. 12
Section 12. This Act takes effect January 1, 2025. 13