Written by Marc Mayer and Stacey Chuvaieva

On September 14, 2022, California Governor Gavin Newsome signed Assembly Bill 587, which imposes a set of new obligations on large social media companies. The new law is designed to encourage social media companies to take action to limit the spread of disinformation, misinformation, hate speech, racism, extremism, radicalization, harassment, and foreign political interference.

Under the new law, companies operating social media platforms that generate more than one hundred million dollars ($100,000,000) in gross revenue during the preceding calendar year must include a set of content policies in their terms of service (“TOS”). Such policies must specify what categories of user behavior or content are prohibited on the platform. The TOS also must specify what action the social media platform will take for a violation of these policies. The law will require companies to submit reports on the enforcement of the content policies to the Attorney General on an ongoing basis. 

The $100,000,000 gross revenue threshold requirement means that some smaller companies may be exempt from the new law. In addition, to be subject to the requirements of AB 587, a platform or service must:

1. have users in California;
2. have as its “substantial function” to “connect users in order to allow users to interact socially with each other”; and
3.  allow users to construct a public or semipublic profile for purposes of signing into and using the service or application; populate a list of other users with whom an individual shares a social connection within the system; and create or post content viewable by other users.

The law also contains a carve-out for internet-based services or applications where “interactions between users are limited to direct messages, commercial transactions, consumer reviews of products, sellers, services, events, or places, or any combination thereof.”

The new law introduces two main requirements: First, the affected company or platform must post social media terms of service.  The terms of service must include (i) the company’s contact information to address the questions about the terms of service; (ii) information and instructions on how to flag content, groups, or other users that violate the terms of service, as well as information on how the company will react to the flagged content and resolution time; and (iii) a list of potential actions the social media company may take against an item of content or a user, including, but not limited to, removal, demonetization, deprioritization, or banning.

Second, the company or platform must submit semiannual reports on the enforcement of the terms of service to the California Attorney General. These reports will be made public through a searchable repository on the Attorney General’s official internet website. The law contains detailed requirements regarding the content of such reports. Reports must state whether the current version of the terms of service defines hate speech or racism, extremism or radicalization, disinformation or misinformation, harassment, and foreign political interference, and if so, how these terms are defined by the platform.  In reporting on enforcement actions taken by the platform, the report must specify, inter alia, the category of content (i.e., hate speech), the type of content (i.e., posts, comments, messages), the type of media (i.e., text, images, and videos), how the content was flagged (by users, AI, content moderators, etc.), and how the content was actioned.

If a company fails to comply with these requirements, the Attorney General or a city attorney may bring an action against violators. Violators are subject to a civil penalty not to exceed $15,000 per violation per day. In assessing the amount of penalty, a court will consider whether the social media company has made a “reasonable, good faith attempt to comply” with the law.

Social media companies subject to the law must submit their first reports no later than January 1, 2024.