87R9480 MLH/JG-D
By: Toth H.B. No. 3105
A BILL TO BE ENTITLED
AN ACT
relating to unlawful acts and practices of social media platforms;
providing a civil penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 15, Business & Commerce Code, is amended
by adding Subchapter F to read as follows:
SUBCHAPTER F. ANTITRUST VIOLATOR LIST
Sec. 15.60. DEFINITIONS; ANTITRUST VIOLATOR LIST. (a) The
definitions provided under Section 113.001 apply to this
subchapter.
(b) The division shall create and maintain an antitrust
violator vendor list that contains the names and addresses of
persons who have violated state or federal antitrust laws. The
division shall publish the initial list on January 1, 2022, and
shall update and electronically republish the list quarterly.
Sec. 15.61. PLACEMENT ON ANTITRUST VIOLATOR LIST. (a) On
receiving reasonable information from any source that a person has
been convicted of or held liable for a state or federal antitrust
violation, the division shall conduct an investigation to determine
whether good cause exists to place that person or an affiliate of
that person on the antitrust violator vendor list.
(b) If the investigation by the division is for an antitrust
violation related to shadow banning by a social media platform
under Chapter 113, the division may subpoena the social media
platform for any algorithm related to its shadow banning and any
related documentation used within the previous 24 months related to
shadow banning.
(c) If the division finds good cause, the division shall
notify the person or affiliate in writing of:
(1) the intent to place the name of that person or
affiliate on the antitrust violator vendor list;
(2) the person's or affiliate's right to a hearing
under Section 15.63;
(3) the procedure that must be followed to obtain a
hearing; and
(4) the applicable time requirements.
(d) If the person or affiliate does not request a hearing
before the 21st day after the date of receiving notice under this
section, the division shall enter a final order placing the name of
the person or affiliate on the antitrust violator vendor list.
(e) A person or affiliate may not be placed on the antitrust
violator vendor list without receiving an individual notice of
intent from the division.
(f) Notwithstanding the publication dates of the antitrust
violator vendor list, a person or affiliate placed on the list is
disqualified from the public contracting and purchasing process
under this subchapter as of the date the final order is entered.
Sec. 15.62. TEMPORARY PLACEMENT ON ANTITRUST VIOLATOR LIST.
(a) If a person has been charged or accused of a violation of state
or federal antitrust laws in a civil or criminal proceeding brought
by the attorney general, a state attorney, or the United States
Department of Justice after September 1, 2021, the attorney general
may, on a finding of probable cause that a person has likely
violated the underlying antitrust laws, temporarily place the
person on the antitrust violator vendor list until formal
proceedings have concluded.
(b) If probable cause exists, the attorney general shall
notify the person in writing of:
(1) the intent to temporarily place the person on the
antitrust violator vendor list;
(2) the person's right to a hearing under Section
15.63;
(3) the procedure that must be followed to obtain a
hearing; and
(4) the applicable time requirements.
(c) If the person does not request a hearing before the 21st
day after the date of receiving notice under this section, the
attorney general shall enter a final order temporarily placing the
name of the person on the antitrust violator vendor list.
(d) A person may not be placed on the antitrust violator
vendor list without receiving an individual notice of intent from
the attorney general.
(e) If the person is found not guilty of or not liable for
violating state or federal antitrust laws, the attorney general
shall remove the person from the antitrust violator vendor list.
Sec. 15.63. HEARING. (a) Not later than the 21st day after
the date of receipt of the notice of intent, the person or affiliate
may file a petition for a formal hearing under Chapter 2003,
Government Code, to determine whether it is in the public interest
for that person or affiliate to be placed on the antitrust violator
vendor list.
(b) Notwithstanding the procedures adopted under Section
2003.050, Government Code, the administrative law judge shall enter
a final order not later than the 30th day after the date of the
formal hearing.
(c) The final order shall contain:
(1) findings of fact;
(2) conclusions of law;
(3) interpretation of agency rules; and
(4) any other information required by law or rule to be
contained in the final order.
(d) The final order shall direct the division to place or
not place the person or affiliate on the antitrust violator vendor
list.
(e) In determining whether it is in the public interest to
place a person or affiliate on the antitrust violator vendor list,
the administrative law judge shall consider the following factors:
(1) whether the person or affiliate committed an
antitrust violation;
(2) the nature and details of the antitrust violation;
(3) the degree of culpability of the person or
affiliate;
(4) whether the person or affiliate has been
reinstated or received clemency in any jurisdiction for the
antitrust violation at issue in the proceeding; and
(5) the needs of public entities for additional
competition in procuring goods and services in their respective
markets.
(f) In any proceeding under this section, the division must
prove that it is in the public interest for the person or affiliate
to be placed on the antitrust violator vendor list. Proof that a
person has been convicted, has been held liable, or is an affiliate
of a convicted or liable person constitutes prima facie evidence
that it is in the public interest for the person or affiliate to be
put on the antitrust violator vendor list. Status as an affiliate
must be proven by clear and convincing evidence. If the
administrative law judge determines that the person was not
convicted, was not held liable, or is not an affiliate of a
convicted or liable person, the administrative law judge may not
direct the person to be placed on the antitrust violator vendor
list.
(g) A person or affiliate who has petitioned for a hearing
under this section may offer evidence on any relevant issue. An
affidavit alone is not sufficient evidence that the person has not
been convicted, has not been held liable, or is not an affiliate of
a convicted or liable person. On establishment of a prima facie case
that it is in the public interest for the person or affiliate to be
put on the antitrust violator vendor list, that person or affiliate
may prove by a preponderance of the evidence that it would not be in
the public interest to put the person or affiliate on the antitrust
violator vendor list, based on the factors in Subsection (e).
(h) The final order of the administrative law judge is a
final agency determination.
Sec. 15.64. EFFECT OF PLACEMENT ON ANTITRUST VIOLATOR LIST.
(a) A person or affiliate who has been placed on the antitrust
violator vendor list after being convicted of or held liable for an
antitrust violation may not:
(1) submit a bid, proposal, or reply for a new contract
to provide goods or services to a public entity;
(2) submit a bid, proposal, or reply for a new contract
with a public entity for the construction or repair of a public
building or public work;
(3) submit a bid, proposal, or reply for a new lease
of real property to a public entity;
(4) be awarded or perform work as a contractor,
supplier, subcontractor, or consultant under a new contract with a
public entity; and
(5) transact any new business with a public entity.
(b) A public entity may not accept any bid, proposal, or
reply from, award any new contract to, or transact any new business
with a person or affiliate on the antitrust violator vendor list.
(c) This section does not apply to contracts that were
awarded or business transactions that began before the person or
affiliate was placed on the antitrust violator vendor list.
(d) All invitations to bid, requests for proposals, and
invitations to negotiate must contain a statement informing persons
of the restriction under Subsection (b).
(e) A person on the antitrust violator vendor list is not
qualified to receive any economic incentives from the state,
including state grants, cash grants, tax exemptions, tax refunds,
tax credits, state funds, or other state incentives.
(f) The conviction or liability of a person for an antitrust
violation, or placement on the antitrust violator vendor list, may
not affect any rights or obligations under any contract, franchise,
or other binding agreement that predates the conviction, holding of
liability, or placement on the antitrust violator vendor list.
Sec. 15.65. REMOVAL FROM ANTITRUST VIOLATOR LIST. (a) A
person may be removed from the antitrust violator vendor list
subject to terms and conditions that may be prescribed by the
administrative law judge on a determination that removal is in the
public interest.
(b) In determining whether removal is in the public
interest, the administrative law judge shall consider any relevant
factors, including the factors in Section 15.63(e).
(c) The administrative law judge shall determine that
removal of the person or affiliate from the antitrust violator
vendor list is in the public interest on a showing that:
(1) the person was found not guilty or not liable;
(2) the antitrust case was dismissed;
(3) the court entered a finding in the person's favor;
(4) the person's conviction or determination of
liability was reversed on appeal; or
(5) the person was pardoned.
(d) A person on the antitrust violator vendor list may not
petition for removal from the list before six months after the date
a final order is entered under this subchapter, unless the petition
is based on a reversal of or pardon for the conviction or holding of
liability, in which case the person may petition at any time.
(e) The petition must be filed with the division, and the
proceeding shall be conducted under the procedures and requirements
of this subchapter.
(f) If a petition is denied, the person or affiliate may not
petition for another hearing before nine months after the date of
denial, unless the petition is based on a reversal of or pardon for
the conviction or holding of liability.
(g) The division may petition for removal prior to the
expiration of the period under Subsection (f) if, in its
discretion, it determines that removal would be in the public
interest.
SECTION 2. Subtitle C, Title 5, Business & Commerce Code, is
amended by adding Chapter 113 to read as follows:
CHAPTER 113. UNLAWFUL ACTS AND PRACTICES OF SOCIAL MEDIA PLATFORMS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 113.001. DEFINITIONS. In this chapter:
(1) "Affiliate" means:
(A) a person who controls, is controlled by, or
is under common control with another person; or
(B) a predecessor or successor of a person
described by Paragraph (A).
(2) "Algorithm" means a mathematical set of rules that
specify how a group of data behaves or is organized.
(3) "Antitrust violation" includes violations of both
state and federal antitrust law.
(4) "Candidate" has the meaning assigned by Section
251.001, Election Code.
(5) "Censor" includes action by a social media
platform to delete, regulate, restrict, edit, alter, remove,
inhibit publication of, or post an addendum to any content posted by
a user.
(6) "Deplatform" means the permanent removal or ban of
a user or suspension of the user's ability to post by a social media
platform, or a temporary removal, ban, or suspension of not less
than 60 days.
(7) "Division" means the antitrust division of the
Office of Attorney General.
(8) "Post-prioritization" means the placement or
ordering of content to feature some content over others, and does
not include prioritization based on monetary payments.
(9) "Shadow ban" means action by a social media
platform to limit or eliminate the exposure of a user or content
posted by a user to other users, and includes action that is not
apparent to a user.
(10) "Social media platform" means an information
service, system, internet search engine, or access software
provider that provides or enables computer access to a computer
server by multiple users, and includes a platform operated by a
for-profit entity that:
(A) has annual gross revenues in excess of $100
million; or
(B) has at least 100 million monthly users
globally.
(11) "User" means a person who has an account on a
social media platform, regardless of whether the person posts or
has posted content.
Sec. 113.002. APPLICABILITY. (a) This chapter does not
apply to the purchase of goods or services made by any public entity
from the Texas Department of Criminal Justice.
(b) A provision of this chapter may be enforced
notwithstanding any state or local law and only to the extent not
inconsistent with federal law, including 47 U.S.C. Section
230(e)(3).
SUBCHAPTER B. SOCIAL MEDIA PLATFORMS DUTIES
Sec. 113.051. GENERAL DUTIES. (a) A social media platform
shall publish the standards it uses for determining how to censor,
deplatform, and shadow ban users, including definitions of any
necessary terms.
(b) A social media platform shall apply censorship,
deplatforming, and shadow banning standards in a consistent manner
among all users of the platform.
(c) A social media platform must inform users of the
platform of any changes to the platform's user rules, terms, and
agreements before implementing the changes.
(d) A social media platform shall provide:
(1) a mechanism to allow a user of the platform to
request the number of other users who viewed the user's content; and
(2) a user of the platform with the number of other
users who viewed the user's content when a request is made using the
mechanism described by Subdivision (1).
(e) A social media platform shall:
(1) categorize algorithms used for
post-prioritization and shadow banning based on the type of content
and user distinctions made by the algorithms; and
(2) allow a user to elect to not use
post-prioritization and shadow banning algorithm categories and
instead view all content in chronological order based on when
content was posted.
(f) A social media platform shall annually provide users
with notice on the use of algorithms for post-prioritization and
shadow banning and provide users with an opportunity to make the
election under Subsection (e)(2).
(g) A social media platform shall allow a deplatformed user
to access or retrieve all of the user's information, content, and
data for a period of not less than 60 days after the date the user is
deplatformed.
Sec. 113.052. JOURNALISTIC ENTERPRISE DUTIES. (a) In this
section, "journalistic enterprise" means an entity that:
(1) publishes not less than 100,000 words available
online with not less than 50,000 paid subscribers or 100,000
monthly active users;
(2) publishes not less than 100 hours of audio or video
online with not less than 100 million yearly viewers;
(3) operates a cable channel providing not less than
40 hours of content each week to not less than 100,000 cable
television subscribers; or
(4) operates under a broadcast license issued by the
Federal Communications Commission.
(b) A social media platform may not knowingly take action to
censor, deplatform, or shadow ban a user who is a journalistic
enterprise based on the content of a publication or broadcast of the
journalistic enterprise. Each social media platform shall develop a
method for users of the platform to identify themselves as a
journalistic enterprise.
(c) The prohibition described by Subsection (b) does not
apply to the post-prioritization of a journalistic enterprise's
content based on payments to a platform by the journalistic
enterprise for the post-prioritization.
Sec. 113.053. NOTIFICATION OF CENSORSHIP OR DEPLATFORMING.
(a) A social media platform may not censor or deplatform a user
without providing notification to the user who posted or attempted
to post the content.
(b) Notice under this section must:
(1) be in writing;
(2) be delivered by electronic mail or direct
electronic notification to the user not more than 30 days after the
censoring or deplatforming action;
(3) include a thorough explanation of why the social
media platform censored or deplatformed the user; and
(4) include a precise and thorough explanation of how
the social media platform became aware of the content, including an
explanation of any algorithm used to identify the user's content as
objectionable.
(c) Notwithstanding this section, a social media platform
is not required to notify a user if the censored content is obscene,
as that term is defined in Section 43.21, Penal Code.
SUBCHAPTER C. CERTAIN RESTRICTIONS RELATED TO CANDIDATES
Sec. 113.101. POST-PRIORITIZATION AND SHADOW BANNING OF
CERTAIN CONTENT PROHIBITED; EXCEPTION. (a) A social media platform
may not apply or use a post-prioritization or shadow banning
algorithm on content posted by or about a user of the social media
platform who is a state or local candidate. Each social media
platform shall develop a method for users of the platform to
identify themselves as a state or local candidate in an election and
protocols to confirm the user's candidacy in that election.
(b) The prohibition described by Subsection (a) applies
only during the period beginning on the date an individual's
candidacy in an election begins and ending on the date of the
election or the date the individual's candidacy in that election
ends.
(c) The prohibition described by Subsection (a) does not
apply to a social media platform's post-prioritization of content
based on a user's payment to the social media platform for the
post-prioritization.
Sec. 113.102. DEPLATFORMING PROHIBITED; CIVIL PENALTY. (a)
Notwithstanding any state or local law and only to the extent
permitted under federal law, a social media platform may not
knowingly deplatform a state or local candidate.
(b) A social media platform that violates this section is
liable for a civil penalty of not more than $100,000 for the
deplatforming of a state candidate and not more than $10,000 for the
deplatforming of a local candidate. Each day of a continuing
violation constitutes a separate ground for recovery.
(c) On request of a deplatformed state or local candidate,
the attorney general may bring an action in a district court to
collect a civil penalty under this section. The attorney general
and the candidate may recover reasonable expenses incurred in
obtaining relief under this section, including court costs,
attorney's fees, investigation costs, witness fees, and deposition
expenses.
Sec. 113.103. REPORTING REQUIREMENTS. (a) Notwithstanding
any state or local law and only to the extent permitted under
federal law, a social media platform that provides free advertising
to a state or local candidate shall submit to the Texas Ethics
Commission, on a form prescribed by the commission, a report that
lists the estimated cash value of the free advertising as an in-kind
contribution to the candidate.
(b) For purposes of Subsection (a), a post, comment, or
other content posted by or about a state or local candidate on the
social media platform that is shown in the same or a similar manner
to other posts, comments, or content is not considered free
advertising.
SUBCHAPTER D. GENERAL ENFORCEMENT
Sec. 113.151. DECEPTIVE TRADE PRACTICE. A violation of
this chapter is a deceptive trade practice under Subchapter E,
Chapter 17, and is actionable under that subchapter.
Sec. 113.152. PRIVATE ENFORCEMENT. A user may bring a
private cause of action against a social media platform for a
violation of Section 113.051(b) or 113.053. In an action brought
under this section, the court may award to the user:
(1) not more than $100,000 in statutory damages for
each claim;
(2) actual damages;
(3) punitive damages, if there are aggravating factors
present;
(4) other forms of equitable relief; and
(5) if the user was deplatformed in violation of
Section 113.051(b), costs and reasonable attorney's fees.
SECTION 3. Chapter 113, Business & Commerce Code, as added
by this Act, applies only to an action taken by a social media
platform on and after the effective date of this Act.
SECTION 4. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2021.