Hillicon Valley — Battle builds over California’s new tech law

Tech industry groups are pushing back against California’s new social media transparency law, signaling a legal challenge may be ahead following in the footsteps of cases brought against GOP-backed content moderation laws in Texas and Florida.  

We’ll also dive into how state attorneys general are leading efforts to take on the market power of the nation’s biggest technology firms as efforts to do so in Congress are stalled. 

This is Hillicon Valley, detailing all you need to know about tech and cyber news from Capitol Hill to Silicon Valley. Send tips to The Hill’s Rebecca Klar and Ines Kagubare. Someone forward you this newsletter? Subscribe here.

Tech groups prepare to take on California law

Californian Democrats appear headed for a similar legal battle facing Texas Republicans as the fight over content moderation plays out through state laws. 

California’s transparency law, signed by Gov. Gavin Newsom (D) last week, has the opposite intent as that of a law backed by Texas Republicans that is set to go into effect after an appellate court ruled Friday in favor of the state.  

But the industry groups opposing Texas’s law are tying the two together, arguing that both content moderation laws are unconstitutional and could set dangerous precedents that lead to more hate speech online.  

“Regardless of whether it’s a Democratic or Republican intent, the First Amendment applies equally. And this is exactly where these bills fail in protecting the First Amendment, and this is essentially government compelled speech,” said Carl Szabo, vice president and general counsel of the tech industry group NetChoice. 

Tech groups haven’t filed a suit against the California law yet, but signaled one may be approaching.  

• “I think there are lots of people talking to lots of attorneys about the clear constitutional failures of this legislation,” Szabo said.  
  
• Adam Kovacevich, CEO and founder of the tech group Chamber of Progress, said the group is “certainly looking at potential legal action against” California’s transparency law.  
  
• “I think one of the things worth noting is that both Texas and the Florida Republican laws had transparency requirements similar to that of the California bill. And those were written by MAGA state legislators, whereas the California bill was written by progressive Democrats. Our view is that they’re all unconstitutional,” he said. 

Read more here.  

States battle Big Tech

State attorneys general are leading efforts to crack down on the power of big technology firms, as highlighted by California’s suit filed last week against Amazon and a Texas-led coalition’s measured win in its fight against Google.  

The cases are just two in a long line of state-led efforts to rein in the power of tech giants that are showcasing the bipartisan angst at Big Tech and momentum on the state level to take on the industry’s most dominant companies while congressional efforts to do so are stalled.  

“Whether you’re Republican or Democrat, people can see what’s going on with these big companies, Big Tech companies and the power and the levers that they exert over everyday Americans, is a little bit scary,” Texas Attorney General Ken Paxton (R) told The Hill. “I think people are realizing, the attorneys general are realizing, that if we don’t address this soon it may be too late, you may never be able to stop it.” 

• Nearly every state is suing Google and Meta, Facebook’s parent company, between three cases filed against the companies in the pasttwo years. 
  
• The unified efforts help state enforcers pool their resources to give them a chance against the mammoth firms. But they’re still facing an uphill battle to take on the country’s most prosperous businesses while using a rulebook critics say is outdated to go after the new age industry titans. 

Read more here.  

REPORT SLAMS PLATFORMS’ ‘FLAWED’ POLICIES 

Social media companies have weak policies on misinformation and have failed to enforce them consistently ahead of the 2022 midterms, according to a new report released Monday. 

The report, from New York University’s Stern Center for Business and Human Rights, faults Meta, Twitter, YouTube and TikTok for not taking a proactive approach to address misinformation, including a growing trend of election denialism and false claims of fraud. 

They say the lack of a proactive approach threatens the approaching election. 

Although social media companies have pledged to tackle election misinformation, the report said the companies’ “flawed policies and inconsistent enforcement result in the continued amplification of election denialism, especially in key battleground states.” 

• The report highlights Facebook’s continued exemption of politicians from its fact-checking program as a concern for amplifying the spread of election denialism. 
  
• It also slam’s Twitter for having an “on-again/off-again enforcement” of its Civic Integrity Policy in a way that has allowed election denialism to “gain momentum since early 2021.”  
  
• The report also focuses on video content, stating that YouTube has allowed its platform to be “exploited by proponents of disinformation” and that TikTok is “increasingly plagued by political misinformation.” 

Read more about the report here.  

BITS & PIECES

An op-ed to chew on: Harshing the mellow: You’d never know legal pot’s downsides reading the features pages 

Notable links from around the web: 

Apple Flexes Muscle as Quiet Power Behind App Group (Bloomberg / Emily Birnbaum) 

Clearview AI, Used by Police to Find Criminals, Is Now in Public Defenders’ Hands (The New York Times/ Kashmir Hill) 

🐾 Lighter click: We’d hold your hand, Jefe

One more thing: Grand Theft hack 

Video game developer Rockstar Games on Monday confirmed the authenticity of a massive hack of development footage for the next entry in its popular Grand Theft Auto series, a leak that went viral on Sunday. 

Rockstar Games said in a statement the development team was “extremely disappointed” in the unprecedented leak of game footage, expressing dismay that “details of our next game [were] shared with you all in this way.” 

“Our work on the next Grand Theft Auto game will continue as planned and we remain as committed as ever to delivering an experience to you, our players, that truly exceeds your expectations,” the studio team wrote. “We will update everyone again soon and, of course, will properly introduce you to this next game when it is ready. 

Read more here. 

That’s it for today, thanks for reading. Check out The Hill’s Technology and Cybersecurity pages for the latest news and coverage. We’ll see you tomorrow.

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