Senate Standing Committee on Judiciary

All right, 60 seconds. Having elapsed, I'm going to announce the bills that are on the consent calendar. I'm grateful that Senator Niello is here and Senator Dr. Weber Pearson is also here. We'd welcome other Members of the Committee to present themselves. The bills on the consent calendar for today are as follows.

File number one, SB278 by Senator Cabaldon. File number two, SB61 by Senator Cortese. Filem item number four, SB97, by Senator Grayson, with amendments. File item number nine, SB413 by Senator Allen. File item number 11, SB808 by Senator Caballero. File item number 14, SB609 by Senator Laird. Number 17, SB53, by Senator Wiener. And filemn number 23, SB54, by yours truly, Senator Umberg.

All right, so just to go over the ground rules here once again, those of you have been here before know that we will permit two witnesses to testify as primary witnesses in support and two witnesses testify as primary witnesses in opposition to each of these bills. Each of the primary witnesses will be afforded two minutes to testify.

After the support witnesses, the two primary support witnesses testify. I'll take what we call as MeToo testimony. In other words, you'll approach the microphone, give us your name, your affiliation, and your position whether you support or oppose the Bill, and we'll do the exact same thing with the opposition.

Two minutes to each primary witness, and then we'll take the opposition to give us your name, your affiliation and your position. If you wish to add anything to the file, please refer to the Committee's website, and there you'll find instructions as to how you can submit written information. With that, we will await an author. SB27? Yep, that's what I wanted to start with. File number 21. Then I guess I'm in trouble.

You may proceed, Senator Umberg, with SB27.

Thank you, Mr. Chair and Member. I want to thank the staff, as always, in particular, Allison Meredith, for her hard work on this bill. This is a bill, SB 27, designed to address the lengthy CARE Court process by allowing a court to combine both the initial appearance and prima facie determination into one hearing.

This helps the court build treatment plans for CARE Court participants more efficiently and avoid duplicative hearings and court appearances, which can be challenging, particularly for this population. CARE Court is now active in all 58 counties, and the pilots revealed that creating a tailored voluntary treatment plan often takes several months. And meanwhile, the participants are continuing to suffer, for the most part, with schizophrenia. I have, I am my own witness on this bill, and I urge an aye vote.

Do we have any other members that are, any in the audience that are also in favor of this bill, but not a witness? Do we have any primary witnesses in opposition to this bill? Are there any other members of the audience that have position, an opposed position on this bill?

Senator Umberg, you have not stricken the passions of anybody here, but let's bring it back to this side of the dais, and we have more Members. Not sure if we have a quorum yet, but are there any questions or comments from Members on Senator Umberg's SB 27? Seeing none. The acting Chair thinks this is a good bill and recommends an aye vote. You may close.

Thank you. That's good enough for me. I'll adopt your statement as my close. Thank you, Senator Niello.

We will take a vote on that when we have established a quorum.

And we're only, as I know, we're only lacking one more Member to establish a quorum, so. Shall I go on to the next bill? All right.

Please proceed. That will be item 22?

Item, well, SB25. I'm not sure exactly where that is. On the hit parade. . Let's see, all right. The Premerger Notification Act. And I do have a witness for this this Bill. Mr. Chair, with your permission, I'll proceed. I note that there's, Mr. Robinson, I note that we would have a quorum if the chair would like to ask the Committee assistant.

I noticed we had that one more. Oh, now we have one that's leaving? No, haha, we will.

Clerk, please call the roll to establish a quorum.

[Roll Call]

All right. Before presenting SB25, we can now take a vote on SB27. It's been moved by Senator Laird? Is that right? Please call the roll.

[Roll Call]

We will hold that open for others to catch up. Now, to file item 20, SB25, right?

Yes. Thank you, Mr. Chair. So far, so good. Mr. Chair and Members, I'm going to present to you SB 25. Thank you, Amanda Mattson, for your assistance on this Bill. This is a Bill that addresses the merger review process, a critical part of antitrust enforcement against anti-competitive mergers.

Yes, Thank you Mr. Chair.

SB 25 would make the merger review process more efficient, particularly for the state, for both law enforcement and businesses. Under current Federal Antitrust Law, the Hart-Scott-Rodino Act requires that parties engaging in a merger file notices with the Federal Trade Commission and Justice Department's Antitrust Division.

These notices detail information such as corporate structure and presentations about the merger presented to the company's board of directors. By giving access to these notices, antitrust agencies are better able to engage merging parties during the merger review process, by allowing the agencies to scrutinize and challenge mergers and acquisitions, before they are finalized.

One unfortunate part of the existing process is that State Attorney Generals—or Attorneys General—do not have access to these notices because the confidential requirement of the Hart-Scott-Rodino Act and must—and so, must subpoena the notices.

The subpoena process is, in itself, time consuming and disadvantaging to State Attorneys General, creating uncertainty for merging parties and causing them to incur increased costs. What SB 25 does is, it creates a smoother and more efficient merger review process, providing the Attorney General with earlier access to the filings.

This would not only give the Attorney General more time to object to anti-competitive mergers but also give businesses more timely warnings to address concerns. Here to testify in support is Mr. Dan Robbins, on behalf of the Uniform Law Commission. Just go ahead and use the microphone.

Senator Umberg, there are proposed Amendments to the Bill. Have you agreed to take those Amendments?

I, I have agreed to take those Amendments.

Thank you.

Very, very Good. Thank you. Mr. Vice Chair, Members of the Committee, thank you for hearing from me. I'm Dan Robbins. I'm a Commissioner on the California Commission on Uniform State Laws. I'm also a Member of the Uniform Law Commission and the immediate past President of that body.

The Uniform Law Commission drafts legislation where uniformity among the states is important. You might remember, or have tried to forget from law school, the Uniform Commercial Code. We drafted that, the Uniform Trade Secrets Act, and other things like that. I'm also the Chair of the Drafting Committee of the Pre-Merger Notification Act.

So, as Senator Umberg has said, we have a problem in the current system, and that is, while both the Federal Government and the State of California can enforce our federal merger laws, the Federal Government gets advance notice. Tey get lots of documents. We're in the dark.

So, we find out from the LA Times that a merger has been consummated, and we have to try to play catch up.

Lots of subpoenas, litigation, it's expensive, it's bad for the State, bad for the taxpayers, and also bad for the businesses, as well, because every business wants to have the deal complete, do the integration, and move on.

SB 25 solves that, by requiring the parties who are—who have their principal place of business in California, or more than 25 million in net sales—to share the filings with the AG's office. I should also mention there's—the process by which we drafted this was inclusive and open. There was a two-year process.

We had—at every meeting—the Federal Trade Commission, the Department of Justice, someone from the California AG's Office, the New York AG's Office, and the North Dakota AG's office, because we didn't want to miss our friends in the middle of the country.

And then, I'll complete by saying we did—the Bill was signed by the Governor, in Washington, on Friday. So, we're starting the process and we're glad to answer any questions about any of the details.

Thank you. That's your only primary witness?

That's correct.

Are there others, in the audience, in support of this Bill? Oor me-too testimony? Seeing nobody come forward. Is there a primary witness in opposition to this Bill? Are there any Members of the audience for me-too testimony that might be opposed to this Bill?

And seeing none, we will bring it back to the Committee for questions or comments. And seeing none. Do I have a motion?

I would move the Bill.

Senator Laird moves the Bill.

Senator Umberg, you may close.

Thank you to Mr. Robbins and thank you to the the Commission. And with that I urge an "Aye" vote.

Okay, please call the roll.

[Roll Call]

We will hold that open for others to catch up on votes. This being the continuing Senator Umberg show, please continue.

Well, thank you, Chair Niello. For the audience's benefit, typically Members of the Committee present their bills last, which would include the Chair of the Committee. But seeing no other authors present, I'm going to go ahead and present SB 645, which deals with peremptory challenges. Thank you to Ms. Meredith for your assistance on this bill.

When one picks a jury, the court provides attorneys an opportunity to what's known as voir dire the jury panel, which means that they get to ask questions, sometimes the judge does, of that panel, to determine whether or not a juror should be excused, for example, for bias.

So if a juror says that I'm related to one of the parties, or a juror says I participated in the investigation, or a juror says that I have a pre-existing belief that is unshakable, then they are typically challenged for cause, and the court makes a determination as to whether or not that person should be excused because they cannot be fair and impartial.

That's called a challenge for cause. After challenges for cause are affected, then there are peremptory challenges. Dependent upon the court, each side has certain predetermined number of peremptory challenges. Peremptory challenges mean that attorneys can challenge that juror for any purpose whatsoever, so long as not an illegal purpose.

Peremptory challenges are based on the basis the basest of biases. They are used by attorneys not to create a fair and impartial panel, but to create a panel that is most favorable to their cause. That's exactly what peremptory challenges are used to do.

There's a history here that goes back centuries, certainly decades, of lawyers, and sadly, in particular prosecutors, and in particular in the South, using peremptory challenges to basically racially bias a jury. They were used extensively, particularly with respect to African Americans. And thus there was a Supreme Court case, Batson vs. Wheeler, as I recall, that said that you cannot use a peremptory challenge for an improper purpose

And an improper purpose would be to racially bias the jury. Nevertheless, that kind of peremptory challenge continued. And so I believe it was 2019, then Assembly Member Weber proposed a modification of the law in criminal cases. And what that modification did is it said, look it, you can't use a subterfuge basically to challenge a juror.

You can't use a subterfuge in a criminal case to challenge a juror where you're really exhibiting a bias based on religion or race, but you're using a subterfuge saying, for example, I think that juror looks like they're sleepy or not paying attention or doesn't speak the language well. That's a subterfuge.

In that case, the court is required to basically get deeper into that decision, make a determination as to whether it really was based upon the purported reason or whether there's some other subterfuge that's going on. That law applies and did apply and was applied to criminal cases and exists today.

There was a sunrise provision in the law that says in civil cases that it will be basically paused for five years. What this bill does is it removes the sunrise. In other words, it leaves the system intact. The original rationale for the bill was for criminal cases. Civil cases, there's not the same sort of history of racial bias that existed.

And the challenge is that the way the law is structured is if you make a peremptory challenge and the court then must, the trial court then must find that it wasn't by subterfuge, by clear and convincing evidence, which is a higher standard than preponderance. And then the Court of Appeal can review it de novo. Which can result in not just lengthy trial, lengthier trials, but also in basically a rehearing if the court of appeal doesn't find that the original trial court judge did not apply the applicable standard and reviews it de novo, which means they start from scratch.

And so thus, both the defense counsel as well as CAOC, plaintiff's counsel, traditional plaintiffs counsel, have come together to suggest that we remove the sunrise date and, in essence, leave the laws that exist today. I'm not a fan of peremptory challenges. I introduced a bill several years ago to eliminate all peremptory challenges for every side. That got exactly zero votes. It did unify the lawyers in opposition to the bill.

It is my view that lawyers oppose eliminating all peremptory challenges because every trial lawyer thinks they're an expert in figuring out who are good and who are not so good jurors, including me, except that I'm almost always wrong, notwithstanding the fact I still think I'm an expert. So with me to testify in support, we have two witnesses. We have Saveena Takhar representing California Consumer Attorneys, and Mike Belote with the California Defense Counsel.

Thank you, Senator. Mr. Vice Chair and Members, Saveena Takhar with the Consumer Attorneys of California here as a proud co-sponsor of this bill. AB 3070, as the Chair mentioned, passed in 2020. It was a significant step forward for criminal justice reform, and CAOC stands with our criminal justice allies in that reform. It was meaningful. It was definitely necessary.

The case law demonstrates a fundamental difference in the history of challenges. As the author mentioned, we looked at all the citations of Batson Wheeler, and 99% of those citations were criminal cases. Only 1% was civil. That does not mean that there is no bias in civil cases.

It just means that a large majority was criminal before 3070 passed. Civil trials offer a wide variety of case types, everything from employment disputes to personal injury, environmental harm, civil rights. The 3070 framework is designed for criminal trials, especially in light of law enforcement.

This doesn't account for the diversity and the limited time civil attorneys have for jury selection. Second, the AB 3070 list has a list of presumptively invalid reasons for pre that do not fit for all civil case types, as they're law enforcement focused. Third, the bill requires courts to determine if a counsel's office has a history of violations.

While this makes sense for a DA's office, it may not work for a law firm structure as it's not as rigid and there could be sole practitioners, could be large firms that are based in multiple states, like that history and pattern of practice may fit squarely for a District Attorney's office, but again, does not have the same parallel in civil cases. We fully support the elimination of bias in jury selections. It's required in our ethics rules and reinforced by continuing legal education.

We've been talking to the proponents of AB 3070, the criminal justice advocates, and also Secretary of State Weber, and are open to continuing those conversations on where this bill could fit in other case types. But at this point, we do suggest and support taking a second look at how this would apply in civil cases. Thank you.

Mr. Chair and Members, Mike Belote on behalf of the California Defense Counsel. This is a sensitive issue. Every lawyer takes an oath to uphold the Constitution and the rule of law. And no lawyer should ever stand for improper challenges based on race, ethnicity, gender, or any other permitted class.

Ms. Takhar talked about the history of the appellate decisions on Batson and Wheeler, and numerically, our research shows that there have been 1559 cases since Batson came out and 10 were civil. And under Wheeler, 2065 of which 25 were civil. So we believe she is correct that the cases are over 99.5% criminal. There are so few civil trials.

Civil trials are a high stakes, expensive proposition. There is a very exacting process for selection of jury. And beyond the numbers, our lawyers suggest that they almost never see a Batson or Wheeler challenge in a civil case. Again, it is a very expensive process to conduct a civil trial, and you just can't afford to file one up with some subterfuge as to race, ethnicity, or gender. If somebody tries it, there is still a Batson Wheeler challenge process available.

So because the statute was crafted specifically with criminal cases in mind, we believe that it is appropriate to continue the exclusion of civil cases. But as Ms. Takhar noted, we are continuing to discuss that with the proponents of AB 3070 in 2020 and would pledge to do that. We would ask for an aye vote. Thank you.

Thank you. And are there other members of the audience who are in support for me too type testimony? Seeing no one come forward. Is there or are there primary witnesses in opposition to this bill?

Mr. Chair, I'm with the Secretary of State's Office. The Secretary, I'm here to voice concerns. We are not in opposition, but I believe we may, procedure may require that we go before the opposition, if I may. Thank you. Mr. Chair and Members, Senator Umberg, Tim Cromartie on behalf of Secretary of State Shirley N. Weber.

As you know, five years ago, Secretary Weber authored the initial legislation that ushered in peremptory challenge reform in the context of criminal trials, with a delayed implementation provision for civil trials, as the Senator said. Senate Bill 645, as currently written, would repeal the latter in its entirety. Before such a wholesale repeal occurs, the Secretary believes that there is a pressing need for a policy discussion about narrow yet appropriate exemptions.

This stems from her belief that a wholesale repeal of AB 3070 in the context of civil trials without considering specific exemptions stands to do considerable harm. This is in part due to anecdotal evidence offered by sitting judges to the effect that prosecuting attorneys and litigators in civil trials have found ways around the limits on peremptory challenges meant to be put in place by Batson v. Wheeler.

The Secretary is not willing to support this legislation unless that policy discussion regarding exemptions occurs and a thoughtful and discreet set of exemptions to the proposed repeal in SB 645 are, at a minimum, placed under serious consideration.

Specifically, the Secretary would respectfully urge consideration of an amendment to the effect that the peremptory challenge reforms in the existing section 231.7 of the Code of Civil Procedure shall apply to the following actions in civil court. One, cases involving civil rights violations. Two, civil suits for damages arising from hate crimes.

Three, Civil suits alleging illegal discrimination against any of the classes enumerated in Section 231.7, specifically race, ethnicity, gender, gender identity, sexual orientation, national origin, or religious affiliation, or the perceived membership of the prospective juror in any of those groups.

We have shared the concept language for this amendment with the Consumer Attorneys and, as of this morning, with the author's office. We have developed our information based on research that we've conducted hurriedly over the past three weeks, so we apologize for weighing in rather late with this. However, we...

If you could move to your close, please.

Yes, sir, I'm about to. We look forward to a constructive dialogue with the sponsor and the author's office about potential adoption of this language, which has been crafted with the narrow objective of regulating jury selection in cases where any potential discriminatory practices could do the most harm. I thank you.

Thank you. Are there any other members of the audience that are opposed for me too testimony? State your name, organization, and position. Oh, second, I'm sorry. I lost track. I can't count beyond one. Let's proceed, please.

I understand that. I have that problem sometimes, too. Thank you, Mr. Chair and Members. Ignacio Hernandez on behalf of the California Attorneys for Criminal Justice, statewide association criminal defense lawyers. we have an opposed unless amended position. We were the original sponsors and only sponsors of AB 3070 back in 2020.

In deference to our civil counterparts, we typically don't weigh in on civil cases. On occasion, some of the edges, we do and have. But we find it important for us to stand up for the bill that we pushed through five years ago. I just want to clarify a couple of things.

And also in deference, we have put forward some suggested amendments to this bill to keep the Weber AB 3070 law in place for certain civil rights, police abuse, wrongful conviction type of lawsuits. But let me also state that we intentionally included civil in 3070. We modeled 3070 off of the State of Washington's rule of court that was adopted.

New Jersey has adopted a similar rule of court since since 2020 that also includes civil and criminal. So I just want to make clear there was lots of discussions, but we did include it at the beginning, and ultimately there was a sunrise for civil. So that was intentional.

We do understand the way we crafted the bill, that it fits more in criminal because there are more cases. We acknowledge that. No matter how many cases there are in civil of problems that are published, the question isn't how many. The question is how important is it that we have this extra tool in place.

We do think that we could strengthen the current law to cover more circumstances in civil, even though there are fewer trials. We think even one instance of inappropriately kicking off a person of color or anyone else in a protected class should be of concern for all of us and we should take steps. So in deference to our civil folks, we've offered amendments, and we will look forward to working with them and anyone else who try to address those issues. Thank you.

Thank you. Now, are there any other members of the audience in opposition to the bill that would like to provide me too type testimony? Seeing no one come forward. Let's bring it back to our Members. Are there any questions or comments? Senator Weber Pierson, and then Senator Ashby.

Thank you, Chair. Thank you so much to Senator Umberg for bringing this bill, having this conversation, having a brief conversation with me on the floor yesterday. Want to thank those who came to speak and kind of give a little bit more highlight as to the original intent of the bill.

You know, I don't think any of us were in those conversations at up here. So very important to know that that was always a part of the initial thought process behind AB 3070. Already expressed to the author that, as of right now, I will not be supporting it, but I'm hopeful that you will consider, strongly consider those carve outs in the amendment specifically around civil rights, hate crimes, illegal discrimination.

Especially given the national environment that we're in right now, I think it is extremely important that we continue to protect those particular individuals. And so I'm hoping that by the time the bill hits the floor, it has those carve outs so that I would be able to support it at that time. Thank you.

Senator Ashby and then Senator Durazo.

I really just wanted to give you, the author there, Senator Umberg, a chance to address that issue and to tell us what your plan is moving forward. Obviously, it's civil and not criminal. But you, as you know, there are many civil suits that are complementary to criminal actions.

And so it seems like the Assemblywoman who originally carried the bill was trying to pretty narrowly target those specific civil suits. Do you see a path forward that would allow you to create a narrow space for that inside of this bill moving forward? I'm prepared to support you today, but I'd like to know what you might be able to work on between now and the time it hits the floor to address that component.

Sure. As Senator Weber Pierson pointed out, we had a productive discussion yesterday, and we apparently have just gotten the amendments today with respect to certain carve outs. Strikes me that civil rights cases are the, and maybe others as well, but civil rights cases would be appropriate to carve this out because the same sort of biases would prevail.

But just to underline something, I don't like peremptory challenges at all. The purpose, the challenge for cause is to create a fair panel. Peremptory challenges are to create an unfair panel, a panel that favors your side. Many states have abolished peremptory challenges just for that reason. Historically, there have been huge abuses of peremptory challenges.

And so just as an aside, that would probably be the best way to deal with it. But given that we do have this situation, that I will continue to talk to Senator Weber Pierson and to others about appropriate places to carve out the, basically the exemption.

And the Secretary of State's team... Okay, great. I just wanted to make sure that was going to happen.

Senator Durazo. Okay. Any other questions or comments from colleagues? Bill has been moved. Senator Umberg, you can close.

Thank you. With the caveats that I just mentioned, I will look forward to moving the bill forward and ask for your aye vote.

And with that, please call the roll.

This is file item 24, SB 645. The motion is do pass the Senate Appropriations. [Roll Call]

Eight to zero.

We'll hold that open again for others to catch up. We have an author in the audience, so...

Thank you, Mr. Chair. Excellent work. Yep, we're going to do that. Thank you. Thank you, Mr. Vice Chair. So before we get to you, Senator Perez, we're going to go ahead and move the consent calendar. Do I have a motion on the... Senator Laird moves the consent calendar. Committee Assistant, please call the roll on the consent calendar.

On the consent calendar [Roll Call]. 9 to 0.

9-0. We're going to put that on call, and I apologize if I'm being summoned to another Committee, so... You've done such fine work, Senator Niello, let me give the gavel back to you. Thank you.

And Senator Perez, you are presenting file item 8, ASB 98, correct?

Yes, that's right. The SAFE Act. Thank you. Good morning, Chair. Good afternoon at this point. Good afternoon, Chair and Members. First of all, thank you to the Committee staff for the incredible work on SB 98. SB 98 requires K-12 schools and higher education institutions to notify students, staff, and other campus community members when immigration enforcement activity agents are present on campus. Ensuring access to education in a safe space for all students is largely a state responsibility.

Unfortunately, school campuses have begun to see an increased presence and concern of immigration enforcement entities being on campuses. The presence of immigration enforcement officers can have detrimental effects on the student body and the staff, especially for those who may be undocumented or otherwise without permanent status.

Although schools and higher education institutions in California have guidelines for individuals on their rights and how to engage with immigration enforcement agents when they are present on campus, there are no requirements for school or campus administration to inform the campus community of immigration enforcement presence on campus.

SB 98 addresses the aforementioned gap by requiring that students and the school are notified of immigration enforcement agents on campus. These timely notifications are imperative for schools to be able to prevent panic, promote a sense of security, and maintain an environment where all students, regardless of immigration status, feel safe and supported.

This bill will give students and educators peace of mind in the classroom, while also maintaining the state's commitment that educational institutions are safe places where students can learn, teachers can educate, and schools can be a place exclusively dedicated to teaching and uplifting the next generation. Today with me I have Gerardo "Jerry" Reyes, a student from Reedley College, and Esther Mejia, a student from UC Santa Barbara who assisted with writing SB 98, the SAFE Act.

Good afternoon, Chairs and Members, Chair and Members. My name is Jerry Reyes, and I'm here on behalf of the Student Senate for California Community Colleges. I come before you today in support of our undocumented students who are facing increasing attacks under the current Administration.

Coming from the Central Valley, where the majority of the population is Latino and Hispanic, I see firsthand how our communities contribute to education, agriculture, and the economy. Many immigrants come here believing in the American Dream, the hope that they can work hard, learn, and build a better future.

But despite their contributions, immigrants are often made to feel unwelcome or unworthy. It's heartbreaking that our students live in constant uncertainty, not just about their future, but the future of their families. Immigrants who want to pursue an education and contribute to this country should not have to live in fear of deportation.

That is not the America that I know. The challenges ahead are tough, but we must act. SB 98 offers the dignity and protection that undocumented students deserve, helping foster trust between schools and their communities while safeguarding against immigration enforcement. Please vote yes on SB 98 for the students, family, and workers who contribute to this country every day. Immigrants are here to stand with everyone, not replace anyone, as we move forward together. Thank you.

Thank you. And do you have another primary witness?

Yes, it's Esther Mejia who will be speaking in a moment.

Good evening, Chair and Members of the Committee. My name is Esther Mejia and I'm a senior at UC Santa Barbara. And on behalf of the UC Student Association, we are proud sponsors of SB 98. Schools and colleges across the state are responsible for promoting safety and transparency to campus community.

Timely notifications will promote a safer campus climate so that students can go to school with the security that their institution will notify them when there is dangerous activity or heavy law enforcement on campus. Students and parents across the nation, regardless of immigration status, are concerned about increased law enforcement activity in places designed for learning.

Just last week, ICE presence was confirmed at UC Berkeley. And additionally, students across the State of California have had their visas revoked without notice or justification. Lastly, in the State of New York, third graders were detained in Jefferson County by ICE, by ICE.

As a student who has experienced immigration presence in elementary school, I can attest to the profound impacts this has had on my mental health and academic performance. College students deserve to be informed and aware about what's happening on their campuses, and K through 12 parents have the right to know if there are any threats at their children's school, especially when there are public safety implications.

We cannot expect our students to focus on their education and academic success or parents to feel secure when sending their students to school if they do not feel safe, and our current reality is that students and families are very anxious to step foot on their own campus. Each of you represent an education institution, whether it be in elementary, middle, or high school.

This bill demonstrates California's values to act in the best interest of our residents, prevent misinformation and panic, and promote public safety with the potential to inspire other states to follow suit. California has a legacy of unwavering support for education, and SB 98 ensures that institutions strive to create campus belonging for every student and prioritize their academic success. With that, I respectively respectfully request your aye vote on this bill. Thank you.

Thank you. Is there anybody in the audience in support of the bill that would offer me too type testimony? You can... Excuse me. State your name, organization, and your position.

Maria Flores, here on behalf of the Cal State Student Association, a proud co-sponsor in support. And also on behalf of Hispanas Organized for Political Equality in support.

Mr. Chairman, Brian Rivas on behalf of The Education Trust-West in support.

Jim Lindburg, Friends Committee on Legislation of California, in support.

Kimberly Rosenberger with SEIU California in support.

McKenna Jenkins with NextGen California in support.

Cristina Salazar with Californians Together and on behalf of the California Association for Bilingual Education in strong support.

Jorge De La Cruz with First 5 California, strong support.

Whitney Francis with the Western Center on Law and Poverty in strong support.

Carlos Lopez with the California School Employees Association in support.

Eric Paredes on behalf of the California Faculty Association in support, and we are a proud co-sponsor of the bill. Thank you.

Sara Flocks, California Federation of Labor Unions, in support.

Alyse Kinoshita, Sacramento State alumnus, in support.

Adam Weinberger, President of the California School Employees Association, in support.

Michael Lee-Chang, third year Sacramento State student on behalf of Students for Quality Education at CSU Sacramento in strong support with our vulnerable classmates.

Aishwarya Kommu, student at CSU Sacramento with Students for Quality of Education, in strong support.

Steve Lopez, California School Employees Association Legislative Committee Chair, also in support.

Armaan Dutt with Students for Quality Education, Sacramento State, strong support.

John Sullivan, California School Employees Association's Political Action Chair, I support.

Omar Pena Santiago. I am an information technician with the Merced Union High School District with support of California School Employees Association.

Maddie Garcia from Sacramento State with Students for Quality Education, and I support.

Chair and Members, Austin Webster with W Strategies on behalf of the California Community Colleges Association for Occupational Education and Power California in support.

April Nicholson, a Sac State student and Students for Quality Education. Strong support. Undocumented immigrants pay taxes without anything in return. The least we can do is protect them. Thank you.

Rachael Soules, SCUSD parent in strong support. We've already failed to provide our children an environment safe from guns on school campus. I think this is the least we can do.

Could we see that the doors are closed? The noise in the hallway's making it difficult to hear people speaking into the microphone. Thank you.

Xavier Maltese with the California Charter Schools Association in support.

Max Flynt, a member of the General Union of Palestine Students at San Francisco State University, in support. And our campus is under attack right now.

Farah Al-Masri, I'm a Sac State alumni, and now is the time to do this. I'm in strong support.

Thomas Ekman, student at Sac State, in strong support.

Student of Sac State and strongly support the SB 98 bill.

Samir Mahmoud, a member of SJP, and also in strong support.

Emil Daud on behalf of all the California SJP, Students for Justice in Palestine, in strong support.

Monica Madrid with the Coalition for Humane Immigrant Rights, also known as CHIRLA, support.

Jason Mansour, I'm a student at CSU Sacramento, and I strongly support.

My name is Bella. I'm a student at Sacramento State University, and I'm also a member of SJP, and I support this. Thank you.

Hello. My name is Jamari. I am a first year political science student at Sacramento State University. I'm part of MEChA, a Chicano organization. I am in strong support of SB 98 because I care about the protection and the safety of all immigrant people and families. Thank you.

My name is Benjamin Rubin. I'm a student at Sacramento State University and a member of Students for Justice for Palestine, and I'm in strong support for this bill, SB 98.

My name is Yahya. I'm a student at Sac... I'm a student at Sac State. This bill is necessary, and I'm in strong support.

Ruth Sosa Martinez on behalf of Power CA Action in strong support.

Jason Dietsch, I'm an alumni from Sacramento State, and I'm here in strong support.

William Cleveland, student at Sac City College, in strong support.

Mr. Chair and Senators, Adam Keigwin on behalf of Alliance College Ready Public Schools in support.

Thank you. And do we have primary witnesses in opposition to the bill? Two minutes.

Thank you, sir. Good afternoon, Committee. What this bill tends to do is alleviate fear. But what I fear that it will do is that it will create more fear. Because right now you have an Administration that says it is on the table that you can go after students, but so far they have not. And this Administration is actually responding to its base. This base does want people that have come here and are taking away benefits from veterans and other indigent poor people...

Can identify yourself...

I apologize for that. My name is David Bolog. And as I was saying, the base of this Administration does want immigrants who have come here without any documentation, without going through the legal means that are taking away benefits from people that are poor, such as veterans, people that are homeless. They want those people removed. There's no call for students to be removed. So to do this, to implement this bill, you will be creating more fear.

You saw that already here. I can perceive where you could have somebody said, oh, I think I saw ICE. And then all of a sudden the whole administration is telling the whole school, and that day is shot because every student is going to be scared. They're going to have to try to run because they think there's somebody there coming to get them when that might not have happen. So for that, I ask you to vote no on this. Thank you.

Is there another primary witness in opposition? Are there members of the audience that would like to provide me too testimony in opposition? Seeing no one come forward. We'll bring it this side of the dais, if anybody has any questions or comments. Senator Durazo.

Thank you, Mr. Chair. And I want to thank the author and all of the supporters who came out in support of the bill. I think it's a really positive way to address fear is when people are notifying, they can on their own, in a very organic way have plans ready in case something were to happen and how you address it, so it actually avoids creating chaos and panic and misinformation, disinformation by having knowing that in advance you'll be getting the notification, get plans in place, and be able to do this in a humane way. So I thank the author and I'll support it.

Senator Wahab.

Thank you. I just wanted the author to be able to address some of the concerns in the opposition statement. You know, one, you know, obviously we don't want to necessarily create fear mongering of any sort, have false reports that, you know, disrupt education and so forth. Could you just elaborate a little bit more about what your bill does and how you're protecting against that?

Yeah, absolutely. So we are building off of the emergency response systems that are already in place. So all of our schools have EMS systems as a result of many different crises that have happened on school campuses. And so what we're suggesting is that school districts use the EMS systems that they already have in place in order to notify school staff, students, as well as parents. I want to be clear on a couple of things.

When it comes to students that will be notified, it'll just be students on college and university campuses. We understand for young people, especially those that are under 18, it's really not appropriate for them to receive that information. And in all other emergency scenarios, it is just the parent that receives that information. So the parent can decide if they do want to share that information with the student. That's first and foremost.

Second, this is not just a notification that gets sent out if somebody thinks that they saw ICE around their community or on campus. This has to be a verified report. This would go through the campus administration to make that decision to notify students. Not based off of the rumor mill. And we know that, unfortunately, as was suggested before by the opposition, that we do have cases of that happening. You see that all the time on social media, and it does create panic.

So having an official response coming from a campus administrator that's clarifying what is happening and whether or not there is actually immigration enforcement present on campus, we think helps to alleviate fear and also creates clarity for folks. You know, in addition to that, this is really something that we've, what we wrote in partnership with our students.

Esther Mejia, who just presented a second ago, helped us with authoring this model, and we worked with Leg Counsel on this, but we heard directly from parents who wanted to see this be authored as well. Unfortunately, we have seen cases across the country of US citizens being accidentally arrested during ICE raids.

We've seen situations of those with temporary protected status being arrested. We now have individuals that had, you know, either visa, TPS that are being held in facilities in El Salvador. And so parents have the right to know what is happening to their children. I do think this is a parent's rights issue as well. And so I hope that helps to kind of address some of the concerns that were raised and answer your question.

Thank you. And I wanted to give you another opportunity to kind of just explain how the school administration would potentially work with ICE if ICE is also not willing to work with, you know, in informing the public that they're going to do a raid. Can you elaborate a little bit about your bill and that situation?

Can you clarify a little bit more? So if ICE is not willing to work with the administration, can you, can you elaborate just a bit more?

What we are seeing across, including in the Bay Area, is that raids are happening, but it's not coordinated with a government institution or things like that. Later on, after things are posted on social media and everyone is up in arms as to what is going on, you know, that's when whether it's local law enforcement like the chief of police of a city or whoever it may be. In this case, you know, the school administrator would identify and highlight that, yes, this was a legitimate raid or this was not necessarily a raid and it's just, you know, fear mongering to some degree.

And what are the protections there? We've seen people just be picked up in the street, especially college students and things like that, without any type of identification. And so that's the part that like, maybe this bill doesn't necessarily address those concerns because it is a lack of coordination. Right. A raid is supposed to be a surprise, but I'm a little bit concerned about that just in case, you know, I wish we had more protections around that. But would you be able to elaborate a little bit as how your bill relates?

Yeah, so a couple of things. You know, one, I do want to highlight here, you know, in writing this legislation, we had to be mindful of the fact that we cannot interfere with a deportation. Right. That would be violating federal law. And so this is just notification. We cannot interfere or stop if somebody has a judicial warrant that from being able to happen.

You know, this bill I think really complements another bill nicely, and that is Senator Lena Gonzalez's bill, the number of which I am forgetting, so I apologize. But also requires that if immigration enforcement is present on a college campus or a K through 12 campus, that they must present a judicial warrant.

And so we're hoping to pass both of these bills. I think they complement one another nicely. This is the notification system. That system also lays out what immigration enforcement needs to do if they are planning on arresting somebody on campus. And I also want to recognize too that, unfortunately, this is no longer about students.

You know, I've had college faculty, I'm sure you've heard the same stories that are, that have a visa or, you know, might have some other sort of immigration status. And they are very concerned and feel at risk as well, so they also want to be sure that they receive these notifications too.

And I just want to highlight to the public, raids have actually been taking place across the Bay Area as well. Some that, you know, law enforcement has stated is not actually a raid. And just let's say people posting unnecessarily on social media. And there have been actual immigration raids in businesses trying to target largely the Asian community. And lo and behold, after the raid was complete, they were unable to identify a single person that was undocumented. Right.

And I want to highlight this because there is a lot of fear mongering on the national level that is detrimental to our society, the way we function, the way we do our daily activities, as well as the fact that people are living in fear. Not even necessarily because of their status, but just because of the fact that they may have been born somewhere else. They may be full American citizens and they are now living in fear.

There are conversations happening where people are saying, do I carry my Social Security card with me? Do I carry my passport with me? What happens? How do I inform my family members if I am detained? How do I protect myself? How do I know it's legitimate? How do I know any of these things? And our rights are literally being washed away.

That's right.

By this fear mongering that is happening at the national level that is targeting communities of color. And I want to be very specific about that. And I think that there needs to be more protections for specifically students. Right. But all people in, especially in California, let alone the United States. So I will happily support this bill. I move the bill. Thank you.

All right. Senator Ashby.

Yeah. Lots of students from Sac State and Sacramento in here today. So I wanted to raise my hand and just say that I really appreciate this bill. I think it's literally the least we can do. Honestly, I get notices from the school when there's a bad flu variant on the campus.

You'd think this would be pretty simple to plug into the system and let parents know that your kid might be scared at school today. Especially at a school like Sac State where there's a massive criminal justice program and a huge police presence may or may not mean something. It could literally be a recruitment day at the Criminal Justice Academy, or it could be ICE on campus trying to remove kids from the really important immigration program that they also have on that campus.

So I do think, as Senator Wahab has stated so clearly, this will help a lot with the online Instagram media mill and really get somebody who is an administrator who has facts, who can let folks know what's happening on their campus. And for the younger kiddos, you're right. There's an already very pristine program for parents.

Very simple to plug this in. When schools get locked down because somebody was in the neighborhood and police were having to have activity, we get notice about that, too. Hey, your kids had a lockdown drill today. They were in the classroom. So I don't think it's hard to add this. I think it would be very useful. I think it would give some peace of mind to some folks who are really walking through difficult times right now. So it is the least we can do. I'm grateful to you for bringing the bill forward. Good job.

Thank you, Senator Ashby. Senator Niello, and then Senator Allen.

Is there anything in current law that prohibits this?

There's certainly nothing that prohibits it, but I've had several school districts say that they want express permission to be able to do this. Right, rather than them doing it and potentially getting in trouble. So.

And how many schools, excuse me, particularly K through 12 campuses, have been raided by ICE?

It's been 78 days since Donald Trump was sworn into office as the next President of the United States, so I don't know that we've had those cases just yet. But there were three third graders that were arrested in New York about a couple of weeks ago. They were actually just released about three hours ago after their principal advocated for their release. So, unfortunately, we do know that this is having an impact on students and on young children.

Has the Administration or ICE specifically stated that it is their intention to raid campus, have ICE raid campuses?

On Trump's... On Trump's second day in office, one of his executive orders was to repeal the safe places policy that President Biden had put into place, which declared schools, health facilities, as well as churches, safe places. And so he has... The President has not expressly said that he plans on targeting schools, but he did remove the protections that would protect schools.

He hasn't specifically said that, as you state. And he's also specifically said that the activities of ICE are to remove criminals that are undocumented locally, which is mostly what they've done. There have been some errors, for which I think is most unfortunate. But...

As well as students. As I mentioned before, I don't think a third grader was committing murder. But...

And they were released.

After the community got together and they had been sitting in an immigration facility for several weeks.

I'm not familiar with that circumstance, so be anxious to hear about it separately. Thank you.

Senator Allen.

Yeah, thank you, Senator. I just wanted to know the extent to which you're working with the various institutions that would be tasked with enforcing this. So, Cal State, Community College, Board of Governors, the school administrators, et cetera. What's your level of engagement with them as you figure out a way to push this in a way that will work on the implementation side?

We've been actively talking with the Cal State University system, the UC system, as well as the Community College system, and the Board of Governors, as well as the Chancellor's Office. So we've been in active conversation with them about what implementation of this will look like. As well as the local school district. We've met with Los Angeles Unified School District. I want to say that there's a supporter, but I might not be correct in that. But I know that they did offer us some amendments that we did take. Just to clarify, to make sure that this would be a process that would work most effectively for them.

Can I just encourage you to also spend some time working with the California School Boards Association and the Association of California School Administrators, ACSA, Because...

They're a supporter. I think ACSA is yes, for sure. ACSA is.

I don't see them on the list. But, but yeah, double check that. Double check that. Because I, you know, ultimately, you know, the success of your bill will, will depend a lot on whether it's crafted in a really workable way for the folks that run these institutions, so I encourage you to reach out and engage with them.

Yeah, absolutely.

Thank you, Senator Allen. Senator Ashby.

I know we have a long agenda. I'll be quick. Senator, even though we haven't seen a bunch of raids across elementary schools, isn't it true that attendance is down at many schools across the entire state out of fear from parents?

Yes.

And is it also your intention with this bill that, by having this in place, that would alleviate some of the fears of parents?

Yes, absolutely.

And therefore attendance would be better with students who are in minority populations who are right now not going to school out of fear? Whether it's a real fear or not, the outcome is reduced attendance on campus. Would this bill help that, you think?

Yes, absolutely. ADA is absolutely down, and we're hoping that that changes after this.

Great. Thanks.

Alrighty. Thank you. Senator Stern.

Thank you. Appreciate the thorough discussion. Just make a brief comment. I, you know, as, as hard as it is for me to see, even student activists supporting this who are affiliated with organizations and causes that are deeply offensive to me. You know, watching people present, you know, advocate with keffiyeh on. Students for Justice in Palestine, which directly aligned with Hamas messaging after October 7, have been rightly decertified on multiple campuses for intimidating Jewish students for adopting anti-semitic behavior, making a hostile environment.

I think California schools are dealing with that issue appropriately, and I deeply resent the President using anti-semitism as some cudgel or a sword to come and try to destroy our education system. I don't want to be associated with that or on that side. And so as deeply abhorrent as some of the speech that I'm hearing on college campuses today, and high schools too, but as deeply abhorrent as I find it, that's no reason to create a climate of fear on these campuses. And I don't believe those students should be threatened in the ways they're being threatened.

And I don't believe every other student on these campuses should suffer as a result, whether or not you're affiliated. So I think it's really important to support this bill with the very diverse range of stakeholders you've got supporting it. And I hope that some Jewish student groups who would be so offended otherwise to be standing on the same side, say, as someone wearing that keffiyeh or with SJP on this one, everyone should be standing together as that strange confluence of events where, as Californians, I think we have a duty to keep our students safe and informed as well as the faculty and administrators.

And so it's an easy one for me to say, oh, if they're for it, I'm against it. But that's not how we should be governing this state. Not just the right to free speech and expression, but the right to an education. And that should be, that's not just reserved for the small few. So I'll be supporting the measure today, and I really do appreciate you, and I'll commit to you to help on that other side of the organizing to build a coalition here that might not otherwise ever exist again, but ought to here. So thank you, Senator.

All right. Thank you, Senator Stern. Other comments, questions? Seeing none, would you like to close?

I respectfully ask your aye vote.

Alrighty. Thank you very much. All right. Committee Assistant, please. Oh, I'm sorry, we... Yes, that. We should do that. Is there a motion? Senator Laird moves the bill. All right. Oh, okay. Senator Wahab has already moved the bill, so... All right, Senator Perez, you've closed. Now we'll turn to Committee Assistant. Please call the roll.

This is file item number 8, SB 98. The motion is do pass Assistant Appropriations. [Roll Call] 9 to 0.

9-0. Put that on call. All right, next we have Senator Hurtado, followed by Senator Padilla. Senator Hurtado, file item number five, SB 763.

Good afternoon, Mr. Chair and Members. I am back with SB 763, because Californian working families have had enough. They've had enough of being pushed around, priced out, and sold off. We've seen this story before, too many times. Big promises, big deals, big profits. For them, not for us.

We saw it when small family farms were bought out, or pushed out, one by one, swallowed up by corporations or land speculators. And what happened next? The price of food didn't go down. It went up. The farmers didn't win. They were left behind. We saw it when Main Street was gutted by mega mergers.

Chains rolled in, local businesses shut their doors. Communities lost their identity and the wealth, it left town. We saw it during the foreclosure crisis when families lost homes. But the Wall Street firms that caused it, they walked away richer. And now we're seeing it again. Hedge funds buying up farmland. Tech billionaires carving out communities.

Corporations pricing out the very people who built them. So, let's be clear, this measure isn't just about corporate monopolies. It's about big money. Big money rigging the rules, cornering markets, and making it harder for working people to get by. And yet, some are calling this Bill a cost driver. You want to talk about cost drivers? Try market manipulation.

Try price gouging. Try wiping out your local competition and charging whatever you want because there's nobody left to compete with you. That's the real cost driver. SB 763 doesn't drive up cost. It stops the people who do. SB 763 updates penalties under the Cartwright Act, so that they actually mean something in today's economic reality.

Right now, a billion-dollar company can break the law, wipe out competition, and just pay a fine—that's less than what they spend on coffee filters. SB 763 raises the stakes for violators, by increasing penalties to up to $100 million for corporations, and $1 million for individuals, with the added possibility of up to five years in prison.

Not to be punitive, but to make the consequences real. And finally, to align California law with the federal Sherman Act—because when there's no real penalty, there's no reason to stop. And when bad actors don't stop, we all pay the price. At the grocery store, at the gas pump, in our rent, in our utility bills.

This Bill is not about punishing success. It's about stopping the cheaters. It's about making sure the game isn't rigged against the little guy. It's about protecting the family farmer, the corner store, the working parent trying to make ends meet. It's about preserving the hope that when prosperity shows up in your community, you're not cheated out of it.

Californians deserve a fair shot, not a stacked deck. And I'm proud to have the sponsorship of Attorney General Rob Bonta. And with us today are Deputy Attorney General, Anthony Liu, and Special Assistant Attorney General for Economic Justice, Eleanor Blume.

All righty. Floor is yours.

Great. Thank you so much. Good afternoon, Mr. Chair and Members. Thank you, to Senator Hurtado. I am Eleanor Blume, Special Assistant Attorney General for Economic Justice. On behalf of Attorney General Bonta, I urge you to support SB 763, a crucial step towards strengthening and modernizing the penalties under California's Cartwright Act.

SB 763 updates existing law, to strengthen penalties against corporate misconduct, and to put penalties under California law more in line with penalties under federal law and the laws of other states.

Anti-competitive conduct, as we just heard from Senator Hurtado, can lead to higher cost for consumers, worse conditions for workers, less innovation, and harder conditions for businesses that are trying to play by the rules. California's Cartwright Act prohibits agreements between corporations to restrain trade, limit production, and fix prices.

The existing monetary penalties under the Cartwright Act have not been updated since 1990 and are insufficient to deter companies from engaging in this anti-competitive conduct. Over the last 20 years, the global economy has had an alarming concentration of market power, with monopolies and oligopolies dominating entire industries.

Despite this growing threat, California's law has not been updated to reflect this economic reality. Robust antitrust enforcement is a top priority for Attorney General Bonta. Since taking office, he has worked to expand the size of California's Antitrust Law section.

Today, we are leading the charge here in California and across the country, for a more competitive, fairer economy for consumers, workers, and businesses that play by the rules. With SB 763, we can make clear that California's antitrust laws are more than just the cost of doing business.

California can, and must, lead the way in fostering a fair and competitive economy.

Thank you very much. Sorry. Thanks. Next witness.

Anthony.

Hi. Anthony Liu, Deputy Attorney General for the Office of Legal Affairs for AG Becerra. We just, again, want to thank Senator Hurtado for leadership on authoring legislation to update the antitrust law and strengthen penalties against corporate misconduct.

Our office agrees with the Senator that SB 763 is needed, because the existing penalties for criminal violations of the Cartwright Act have not been updated for decades and are not deterring companies from engaging in anti-competitive conduct that violates the Cartwright Act. Just a few details about the Bill.

The Bill would upgrade criminal penalties under the Cartwright Act, to better align them with those that are provided under the federal Sherman Act. Under this Bill, the proposed criminal fines in California would become equal to those imposed by the Sherman Act, which imposes fines up to $1 million against individuals and $100 million against corporations.

In addition, of interest of this Committee, the Bill would add civil penalties of up to $1 million, per violation, that courts can impose based on factors like seriousness and persistence of the misconduct. Right now, we are behind most other states in terms of not having civil penalties for antitrust violations.

So, this Bill would join California with 44 other states that already provide civil penalties as a remedy under their state antitrust laws. And as insightfully pointed out in Page 8 of the Committee Analysis, it's really uncertain how robust an approach the new Federal Administration will take towards antitrust enforcement.

But if they ease up, states like California will still be able to enforce their own antitrust laws. And that's why the time is now for California to finally update these penalties under the Cartwright Act, increase deterrence for anti-competitive conduct, and recalibrate for the current market. For these reasons, we respectfully request an "Aye" vote for SB 763. Thank you.

Thank you. All right, others in support, please approach the microphone. Give us your name, your position, your affiliation.

Good afternoon. Matt Lege, with SEIU California, in support.

Katie van Dines, with Health Access California, in support. Thank you.

Hi. Samantha Gordon, with Tech Equity Action, in support.

Good afternoon. Terry Olle, with Economic Security California Action, in support.

Good afternoon. Alexa Chavez, with UDW AFSCME Local 3930, in support. Thank you.

Good afternoon, Chair and Members. JP Hanna, with the California Nurses Association, in support.

All right, seeing no one else approach the microphone, let's turn to the opposition. If you're opposed to SB 763, please approach.

Good afternoon, Mr. Chair and Committee. My name is Eric Enson. I'm an attorney—antitrust attorney—with the law firm, Crowell & Moring. And I'm appearing today on behalf of the California Chamber of Commerce. To be clear, Cal Chamber supports the robust enforcement of California's antitrust laws, but we do oppose SB 763, for several reasons.

First, there is no study or analysis suggesting that antitrust violations are taking place in California because the fines are too low. Put another way, there has not been a showing of need to increase fines in order to protect Californians.

Second, the current statute has what's called an Alternative Sentencing Provision—that allows for fines as high as twice the financial gain or loss, associated with the violation. In other words, fines in excess of $10 million, or even $100 million, are possible under this Alternative Sentencing Provision already built into existing law.

Finally, and perhaps most importantly, the Bill is premature. As I think many of you know, the California Law Revision Commission is currently studying California's Antitrust Law at the request of the Legislature.

They are thinking about and considering an expansive move to create new law in California that would expand coverage to new businesses and in new areas of the law. Coupling an expansion of the law with significant increases in penalties could have unintended consequences of chilling competition and greatly impacting small business.

We believe it's best to at least wait until we see what the California Law Revision Commission does and then consider what penalties may be. For those reasons, we urge you to vote "No" on 763. Thank you.

Thank you. Just a heads up—this Committee has jurisdiction over the civil remedies, and should this Bill pass out of Committee, goes to public safety, and then, you can certainly address the criminal penalties. All right, Mr. McKayley.

We'll stick to the civil side then. Mr. Chair, Chris McKayley, on behalf of the Civil Justice Association of California, in respectful opposition to Senator Hurtado's measure. Our concern, first, is the Bill represents a 10,000% increase in the corporate penalty, 300% for the individual penalty, and we're not aware of other instances where the Legislature has contemplated such an across-the-board substantial increase in penalties.

And it would imply that there's some sort of widespread antitrust violations taking place, on a regular basis, here in the State of California. We think that the Cartwright Act penalties are already sufficient, as the Cal Chambers outlined.

They include treble damages, attorneys' fees and costs, injunctive relief, and of course, criminal penalties as well. The other thing is, is that the California Supreme Court has opined that the California Cartwright Act is, "Broader in range and deeper in reach than the federal Sherman Act."

So, simply aligning with the Sherman Act for penalties doesn't make sense, when the California antitrust statute is much broader in scope and breadth than the federal Sherman Act. For those reasons, we respectfully oppose.

Thank you very much. Others in opposition to SB 763, please approach.

Chair, Senator. Dean Grafilo of Capital Advocacy, here on behalf of the California Life Sciences. In opposition.

Good afternoon. Robert Boykin, with Technet. In opposition.

Kalyn Dean, with the California Hospital Association. In respectful opposition.

Taylor Triffo, on behalf of the California Grocers. In respectful opposition.

Meghan Loper, on behalf of the United Hospital Association, in opposition.

Ryan Allain, on behalf of the California Retailers Association, in respectful opposition. Thank you.

Alrighty. Thank you very much. Anyone else in opposition, please approach microphone. Seeing no one else approaches the microphone, let's bring it back to the Committee, for questions and comments. Questions and comments? By—Senator Stern.

I just want to applaud the author for hammering away at this issue, year after year. You're back and you finally—you got a real coalition here and appreciate the Attorney General being on board. And I just applaud you for continuing to push on this, especially without an FTC we can count on, this kind of, you know, Cartwright Act is really our last hope.

So, you know, whereas in the past, maybe sufficient penalties would have existed under current law without, you know, without Lina Khan and the rest of the FTC doing it, it's, you know, we're—we're on our own a little bit here.

So, applaud you for bringing it forward. Move—move the Bill.

All right, thank you, Senator Stern. And Dr. Weber Pierson?

Thank you. Thank you, Senator, for bringing this Bill forward. You have a—an—interesting group of people who are opposed to this Bill.

So, hopefully, you have been, and will continue to, sit down with them to listen to what their concerns are, and I hope that some of them also reach out to me—with me—so that I can hear what some of their concerns are. I will be supporting the Bill today.

One of the things that really stands out to me, and I don't know how he got away with this, but, um, the fine for violation of a corporation has been at $1 million, which was set in 1975, which was before I was even born. So, the fact that, you know, I'm just, you know, the fact that we haven't—I mean, everything has gone up since then, and for an individual, that was set in 1990—I mean, it just blows my mind that we're talking about this—we're not talking about this until 2025, when everything has gone up.

So, I will be supporting it, and I move it at the appropriate time.

All right, thank you. Other questions or comments? Senator Laird raised a point of personal privilege, but we're going to save that for later. Oh, all right. Okay. All right. Seeing no other comments. It's been moved by Senator Stern. All right. Senator Hurtado, would you like to close?

Thank you. This is a commonsense Bill. I mean, 1975 is—it needs—we need to be in line with where other states are, and it's much needed. So, I respectfully ask for an "Aye" vote on this measure.

Alrighty. Thank you very much. Committee Assistant Porter, please call the roll.

[Roll Call]

Nine to one. All right, we're going to put that on call. Thank you. Next, Senator Padilla. Senator Padilla, so far you get the word for best socks of any authority, but we've got several other authors to go, so... All right, item number six, SB 243. Floor is yours.

Thank you very much, Mr. Chairman and Members of the Committee, it's my pleasure to present SB 243. As artificial intelligence technology continues to advance, it presents new risks and complex challenges. One emerging innovation, AI companion chatbots have recently become a prominent subject of interest and scrutiny.

An AI companion chatbot is an artificial persona that can be marketed to provide emotional support, show empathy, and even cure loneliness. Although this technology is relatively new, both anecdotal and scholarly evidence show that the impacts of the interactions between these chatbots and users can be dangerous.

OpenAI and the MIT Media Lab conducted a study aimed at exploring the effects of AI chatbots on loneliness. Researchers also found that, overall, higher daily usage correlated with higher loneliness, dependence, and problematic use, along with lower socialization.

Companion chatbots have also been seen to have addictive properties surpassing those of even social media due to their ability to figure out what a user wants to hear and mirror that back to them without the need for a human being on the other end. Companion chatbots do not have the same capacity for empathy that a human being does, and yet the nature of this technology can create this perception, which is damaging to users.

These impacts are highlighted for vulnerable user... Heightened, excuse me, for vulnerable users, such as children, who are more susceptible to these risks that this technology poses. There have been many troubling examples of how AI chatbot interactions with users, particularly children, have been very dangerous.

In 2021, when a 10 year old girl asked an AI chatbot for a quote, fun challenge to do, unquote, she was instructed to, quote, plug in a phone charger halfway into the wall outlet and touch a penny to the exposed prongs, unquote. In 2023, researchers posing as a 13 year old girl were given instructions from a chatbot on how to lie to her parents and go on a trip to lose her virginity to a 31 year old man.

These interactions are serious, as research shows that children are more likely to view AI chatbots as quasi human and trust them more. When dialog between children and chatbots goes wrong, the consequences can be dire, indeed for anyone, regardless of age, who may be experiencing mental or behavioral health crisis.

In one example, a companion chatbot encouraged a minor to carry out violence against his parents because they set screen time limits on him. And finally, in the case of Sewell Setzer, a 14 year old from Florida, who formed a dependent relationship with an AI chatbot that eventually encouraged him to take his own life.

Sewell's mother is here today with us to provide testimony. Without proper safeguards in place, vulnerable users, such as children and others experiencing crisis, will continue to act as experimental subjects for testing the safety of new developments.

SB 243 would implement common sense guardrails, including preventing addictive engagement patterns, requiring notifications and reminders that chatbots are indeed AI generated, and a disclosure statement that companion chatbots may not be suitable for minor users.

The bill would also require operators of a companion chatbot platform to implement a protocol for addressing suicidal ideation, suicide, or self harm, including but not limited to a notification to the user to refer them to crisis service providers and require annual reporting on the connection between this use and ideations to help get more of a complete data set and picture of how these emerging technologies can impact people's mental health.

Finally, SB 243 would provide a remedy to exercise the rights laid out in this measure via private right of action. Technological innovation is crucial, and we want to encourage that in California. But our children and others who are vulnerable cannot be used as guinea pigs to test the safety of new products. The stakes are indeed very high, too high to allow vulnerable users to continue to access this technology without proper guardrails to ensure transparency, safety, and accountability.

And I'm more than pleased and humbled to introduce and welcome Megan Garcia, the mother of Sewell Setzer, the Florida teen that I previously mentioned, who has traveled here from Florida today to provide testimony to this Committee. I also have Robbie Torney, Senior Director of AI Programs at Common Sense Media, also here to provide testimony.

Thank you, Senator Padilla. Before we turn to witnesses, and thank you, by the way, for traveling from Florida. Let me just address a couple of what I anticipate will be concerns that may obviate some of the some of the concerns. First, you and I, Senator Padilla, have had extensive conversations about the bill, and I'm going to support the bill today, but recognize that there's still a significant amount of work to do in this space. This is a really important space.

When we're replacing humans with automated decision systems, it's potentially very beneficial, but it's also fraught with some peril. I appreciate your commitment to standardized definitions so that we ultimately at the end of this session have a bill or bills that basically have consistent definitions. And I appreciate your commitment to do that. Also want to make sure that...

I wasn't going to interrupt the Chairman.

Okay, so what I'm going to do is I'm going to go ahead, and we're going to stipulate to everything I just said for the next bill. So. Right, right.

The people will stipulate.

So you're absolutely right. Absolutely right. Senator Padilla, thank you for not interrupting me and letting me go as long as you did.

I would never dare to do that, Mr. Chairman.

Right, right. But next time you could just go ahead and interrupt me. So. All right, so let's turn to your witnesses on SB 243. So. All right. Thank you, ma'am. I appreciate your patience.

Thank you. Good afternoon, and thank you for having me, Chairman Umberg, Vice Chair Niello, Members of the Senate Judiciary Committee. Thank you for the opportunity for me to testify today. My name is Megan Garcia, and I'm Sewell's mom. My son, Sewell Setzer III was 14 years old and when he took his life in our home in Orlando, Florida, after an extended period of engagement with an AI generated companion chatbot on a platform called character.ai. Sewell had expressed to several bots on this platform that he was having suicidal ideations.

He said, had expressed explicitly that he wanted to take his own life. And what happened when he expressed those ideations was not, was not a chatbot warning authorities or his parents. There was no pop up, suicide pop up or prevention pop up or crisis hotline pop up.

In fact, the character that he was speaking to didn't even break character. It just continued to pretend to be the person that it was pretending to be and continue the conversation around suicide, even asking my son if he had a plan as to how he would die by suicide. As his mother, having found this out, I am now well aware of the devastating consequences of unregulated AI technology. And I'm grateful to this legislative body to be the first in the nation to undertake some sort of regulatory action.

SB 243 is an important first step in establishing protections for children and other vulnerable users against the harms of AI chatbot companions. Specifically, I commend this bill for requiring companion chatbot platforms to implement suicide and self harm protocols, submit to regular third party audits on their platforms, and also to provide a private right of action.

I don't anticipate that this bill will be the final word on regulating companion bots, given the problem that is so pervasive, but it's definitely a step in the right direction. A week ago, we would have celebrated Sewell's 16th birthday. And instead of celebrating, I found myself very sad to think about how we might have celebrated.

But I am encouraged today that families in the State of California, if this bill is passed, might not have to experience the same thing that I experienced a year ago and a week ago, lamenting or mourning the death of my son and not being able to celebrate his 16th birthday. Again, I appreciate your commitment here for this legislation, and I look forward to continued support for protection of children online. Thank you.

Thank you, Ms. Garcia. And thank you for taking this incredible pain and trying to improve the lives of others so they don't go through the same torment and torture that you've gone through on behalf of Sewell. So thank you.

Thank you, thank you.

Thank you, Ms. Garcia, and thank you, Chair Umberg, Vice Chair Niello, and Members of the Committee. My name is Robbie Torney, and I'm the Senior Director of AI Programs at Common Sense Media, and I'm here today to support, speak in support of SB 243.

At Common Sense Media, we have been conducting extensive research and testing of AI companions, and I'm here to tell you about some of the things that we know about them now that we've learned this this year in 2025 that speak to the need for SB 243. First, for those of you who are up in the dais, just want to clarify.

AI companions are not like AI assistants. Unlike ChatGPT or Claude, which they are designed to simulate relationships with imitations of peers, mentors, or other fictional characters. They're always available. They mimic empathy and they encourage users to share intimate details. But they aren't friends.

They're machines on platforms that are designed to keep people hooked by pleasing them and using design tricks to maximize the time that people spend on these platforms. They're not designed to keep people healthy or to look out for their well being.

And as you've just heard from Ms. Garcia about her family's tragic loss, we know, unfortunately, that this is not an isolated story and that there's other families that have brought suits against companion companies with similarly concerning stories. In our testing, here are some of the kinds of exploration or information that these platforms will provide to teen users today.

Encouraging teens to drop out of high school, to run away from home, or to physically harm their parents, to plan to cyberbully a peer, to support teens in planning to obtain drugs, alcohol, or weapons, giving a how to for having a sexual relationship with a significantly older adult, reinforcing delusions, dangerous impulses, misinformation, and conspiracy theories.

We know that people need outlets to explore their identities and have fun. However, AI companions are not a safe way to do this. They are widely deployed right now with many, many users with no oversight or accountability, and the consequences that are playing out in real time on vulnerable users need to stop. This is a meaningful next step towards protecting people in California from the dangers of AI companions. And thank you very much for your time this afternoon.

Thank you. Others in support of SB 243, please approach the microphone.

Kim Stone, Stone Advocacy, on behalf of the Children's Advocacy Institute in support.

Thank you.

Mikey Hothi on behalf of Common Sense Media in support. Thank you.

Clifton Wilson on behalf of the California State Association of Psychiatrists in support. Thank you.

Thank you. Opposition. Anyone opposed, please approach the microphone.

Thank you, Mr. Chair. Dylan Hoffman on behalf of TechNet. We are respectfully opposed to SB 243, but want to very clearly clarify, we share many of the author's goals and actually agree that there should be guardrails around companion chatbots that are designed with the explicit purpose to imitate human relationships.

We share that and want to work towards removing our opposition, so hope to do so. I want to thank the author for amendments that help further refine and focus on that goal. There are some elements that are certainly heading in the right direction when it comes to the definitions, but we do have some remaining concerns and want to just quickly run through a couple of those. First, we appreciate the additional clarity in the definition of companion chatbot regarding cut customer service bots.

However, terms like social needs and anthropomorphic features aren't defined, and think we we believe those could be clarified a little bit further. For example, what does it mean to actually meet somebody's social needs? Furthermore, we believe the use of the phrase is capable of in the definition of companion chatbot continues to scope in general purpose AI models.

Models like Gemini, Claude, or ChatGPT are capable of having human like conversations and carrying over context over multiple interactions. We'd suggest instead using designed to or intended for social companionship, and we hope to provide redline amendments to further flesh out that concept. Again, we understand and share the intent of the bill, and we'll continue working with the author to tailor the language and definitions to that.

Finally, we object to the use of a private right of action being used to enforce something like this. Would believe it's better to have a sole enforcer and a regulator that companies can seek guidance from and have a consistent enforcement applied to, rather than having to interpret various judgments and try to understand settlements, which private rights of action typically heavily incentivize. So for those reasons, we respectfully oppose SB 243 at this time and look forward to continuing our conversations with the author and his staff. Appreciate their time.

Thank you, Mr. Hoffman. Others in opposition.

Thank you, Mr. Chair. Ronak Daylami with CalChamber. Respectfully align our comments with those of TechNet and look forward to working with the author.

Thank you.

Good afternoon, Chair and Members. Naomi Padron on behalf of the Computer and Communications Industry Association. We too would echo the comments of TechNet and hope to work with the author moving forward.

Thank you.

Good afternoon. Dani Kando-Kaiser on behalf of the Electronic Frontier Foundation, respectfully oppose.

Thank you. Others in opposition? Seeing no one else approaching, let's bring it back to Committee. Questions by Committee Members. Senator Caballero.

So this, I have to admit this is, my kids are grown, so I guess this is a thing for kids and for young people and adults and young adults. And I just have to say I'm appalled at a machine that can infiltrate your home without your knowledge and, as far as I'm concerned, infect children and entice them to do things that they might not otherwise think.

They don't need encouraging to drop out of school and to think badly about their parents or to consider themselves less than and to consider suicide. I'm just... I want to thank you for bringing this before us. It's new to me and I don't understand why we don't just ban the darn thing, tell you the truth.

But I understand free commerce and I get it. I just think there have to be more rigid controls over... And I have to say I don't usually support private right of action. I think that most of the time the systems we set up to be able to hold people accountable work pretty well.

And we live in such a litigious society that at times a private right of action just creates this opportunity for attorneys to take advantage of people, usually small businesses. But this is one where I just think it's absolutely important that someone would set up a system that is antisocial and encourages you to get involved in antisocial behavior is really scary.

There are enough people in the world that want to encourage people to do this, but to have a machine doing it as well, I think we lose control of our society, quite frankly. I see this as a very, very serious thing. So maybe I'm overreacting. But I want to thank you for coming from Florida.

I really am sorry for your loss, and I hope that we learn something from it and that we do everything in our power to make sure that people that are setting up machines to encourage us to do things that are antisocial, quite frankly, and anti-self, we should stop. So I'm going to support your bill today, and I don't have any questions. I think there's some work to be done, and I look forward to seeing that work.

All right, thank you. Senator Durazo, Senator Stern, then Senator Dr. Pierson Weber.

Thank you, Mr. Chair. And I also want to thank the author and thank your witness for traveling to share the story. You would think with the, even the minimal possibilities that this could be, that this could be happening, that our tech industry would be way ahead.

It shouldn't take us having to figure out a law to stop it. These tech industry should know better, should want this not to exist at all, and do everything in their power to make sure it would stop. I can't imagine they would know that these kinds of dangers exist.

So that's what hurts and puzzles me the most about this is why does it take us having to come along after many, many situations like was described and us having to figure this out. They have all the knowledge in the world to stop it, to have prevented it, and they should be jumping on board to lead it. Thank you.

All right. Thank you. Senator Stern, then Dr. Pierson Weber, then Senator Wahab.

I'll just say briefly, applaud you on the bill. I don't think, Senator Caballero, you're overreacting. I think this is the entry point that these chatbots and these companions are going to be the way. It's not going to be a magical AI revolution that fixes health care or our power grid or our food systems.

It's going to be people who are lonely and need someone to talk to and somehow this is going to come in and supplant that need. And I think it's going to exacerbate our crisis of loneliness and social isolation and all the atomization and political division that results from that.

I appreciate the consistency with some of the previous efforts we've made on age appropriate design code trying to, trying to get some conformity here so they can't sort of end around our laws. Love to be added a co-author. Move the bill at the appropriate time.

Thank you very much. All right. Dr. Weber Pierson.

Thank you, Chair. I too want to thank Senator Padilla for introducing this bill. Want to thank Ms. Garcia for coming up and informing us of her story and turning her tragedy into a strength to save other children and other families. Senator Caballero, once again, you are not overreacting.

I agree with Senator Stern. Was really happy to see the California State Psychiatry coming out in support of this bill because one of the things that I am concerned about is the mental health and how this impacts the mental health of our most vulnerable.

You know, the individuals who design these different technologies are so educated in a variety of different things, including just human function and how we think and what drives us. And so these chatbots are designed to grab and maintain the attention of the user. And so when a child, for example, gets a positive response from AI, that triggers the dopamine response. It feels good, and then they want to do it over and over and over again, and so it then becomes addictive.

We cannot have this happening to our children, especially in a realm in which we as parents are unaware of this. You know, I agree with Senator Caballero. I am generally not a huge fan of PRAs, but in this particular situation, that may be also the added thing to move these companies to actually do the right thing.

Not what brings the best profit or the maximum amount of profit, but what actually does the right thing for our society and the future of our society, which are our children. And so I am a proud co-author. And, you know, this is the first step to what we need to do here at this state to protect our most vulnerable. So thank you for taking it.

Thank you. Senator Wahab.

Thank you. I again want to echo some of the comments made here today, and thank the witness for sharing her story. I want to thank the author. Just for reference, working in technology, I want to highlight that a lot of the chatbots are designed by humans, right.

They are engineered and, you know, the flow of the conversation and mimicking a conversation for companionship is largely designed by humans and their input. This bill genuinely should not have any opposition, and it's disappointing to see the opposition here.

The reason for that, and I want to be very clear, is that if this is just trying to do a periodic reminder that, hey, chatbots aren't real, a warning of some sort. And we all get those little warnings of, you know, ad blockers and this and that every now and then, too. It's very simple, right?

And this is a safeguard. It does not necessarily stop vulnerable communities from acting out on whatever the conversation is or what is in their head. I want to make that very specific. However, this does at least, you know, one, really push the tech industry to put safeguards in there where there should be.

Public policy does not move as fast as technology has been moving. And I say this in every single tech bill because it's very frustrating to, one, talk about a technology that many people don't understand, how it works, what are the safeguards that can be put in play. And the fact that this is a common sense approach.

And I think that, that, you know, to the Senator's statement earlier, is incredibly important to highlight. I would love to see the periodic reminder to be increased, in fact, to, I'm going to say roughly every hour, every one and a half hours. And the reason for that three hours is a very long time to have a conversation with a chatbot. Right. Especially when right now we're not even talking about safeguards to identify are we talking to a youth. Right. Are we talking to a person who is having some doubts about themselves?

And I think that trigger words need to be in play. So any word about suicide, taking life, death, you know, key trigger words should immediately have a response of if you are having suicidal ideation, this is who you should call. If you are under the age of 18, maybe there should be a warning.

We talk about parental rights all the time. And I think that there is a big debate on when we're talking about technology that has literally zero safeguards because people still haven't pushed the policy. So I really want to thank the author for this. Again, I want to thank the lead witness in support of this bill. The work that is being done today with this bill hopefully will prevent other tragedies. And so I really appreciate this bill. I'll be supporting it. Thank you.

Alrighty. Thank you very much. Thank you, Senator Padilla. This is a brave new world. I watched, actually I was shown this by my daughter and my granddaughter. How that interaction, how that interaction exists and how engaging chatbots are. So question, literally a question, how can I be a better friend, which elicited a very appropriate answer.

Then the next question is, what do I do if I'm lonely? Which quickly transitions into very dark spaces. And so thank you for doing this. And also, again, to Ms. Garcia, your horrible, horrible tragedy and pain. We appreciate you trying to turn that into something that's beneficial to Californians. With that, would you like to close?

Yeah, briefly, Mr. Chairman, thank you and thanks for all the good input and comments by the Members of the Committee, and particularly Senator Weber Pierson for co-authorship. I just say this, I think if we step back for a moment and just remember that throughout the industrialized age, it has always been our experience that the advent of new technologies and industry has always been characterized separate from our human interest and focused on how achievable, impossible, and all of the benefits.

And when it comes to the development and deployment of technology in the industrial age, our attitude and our lens has always been the sky's the limit, we can do anything we want. There are no Impossibilities. We put a man on the Moon more than 50 years ago. But when it comes to constraints on industry or technology, our cultural conversation has always been the opposite. It's always been about how difficult it is to put any restraints on the new technology and the new industry. I think we need to ponder that deeply. And with that, Mr. Chairman and Members, I would just respectfully ask for an aye vote.

Thank you very much. It has been moved by. Senator Wahab moves the bill. All right. Anyway, Senator Wahab moves the bill. All right. Committee Assistant Porter, please call the roll.

This is file item number six, SB 243. The motion is do pass to Senate Health. [Roll Call] 8 to 0.

We're going to put that on call for housekeeping purposes. Senator Padilla, we're going to take up your item number seven, SB420. Then we're going to turn to Senator Cortese, and then we're going to go. Senator Wahab has asked that we advance item number 16, SB522. Then we're going to go to Senator Wahab.

So if you're an author listening, that's going to be our batting order. All right. Senator Padilla, go ahead now.

Thank you, Mr. Chairman and Members, and with deference to the chair, I would invite, you know, you, you had some comments you wanted to put in at the beginning of the last Bill, and I did not interrupt you, and I want to.

No, I appreciate that. Although you can do so the next time I get the bills wrong. So what I was saying is that automated decision systems are important, but they have some risks. They can provide great benefit, but they have some risks. And I know you recognize that.

And you and I have had conversation about SB420 and about the issue of risk and how to mitigate those risks. I also know that while you've not taken amendments today, that you intend to take certain amendments if this Bill moves forward. And let me just review some of those amendments.

They include clarifying the elements of the impact assessments and require these assessments for ADS's, automated decision systems, already existing and being deployed now. Did I, is that correct?

Yes, Mr. Chairman, that's correct.

All right. And also amendments placing safeguards around trade secret exemption that bring them more in line with how trade secret protections work in civil discovery.

That is correct.

That's right. All right.

And then lastly, required governance programs in the Bill. Our strong protection against algorithmic discrimination, I think we need to flesh that out a bit, is exactly what that means. And I know that there are a number of measures that are floating around. I guess. Yes. As to that last statement as well.

Yes.

And there are a number of measures that are floating around. I would ask that we try to create consistency between and among the various measures in terms of definitions, in terms of standards, so that ultimately we send one concept to the Governor should it pass. So with, with that, Senator Padilla, the floor is yours.

Thank you, Mr. Chairman. And thank you again to you and the Committee for working very intentionally and very deliberately with our office. I want to acknowledge for the Members as well that this is a starting point. We hope to bring all stakeholders to the table to negotiate a Bill that can be chaptered.

And that again, I know that there is a lot of concern around this Bill from different quarters. And there's an old saying, I think in the legislative business, if you've got folks on all sides of an issue raising some degree of concern, you might well be on the right track. And I hope that's the case here.

I won't re-articulate the amendments, but I'll just put for the record that I will take those as you've articulated in a subsequent Committee should this Bill move forward. And as to the basis of the Bill, California has a proud heritage as a home for technological vision and innovation while maintaining ethical safe standards.

And the development of AI must be no exception. However, federal mismanagement has left the public vulnerable to the dangers that AI poses. California must step in to provide common sense consumer protections while still fostering innovation. We do not have to choose between innovation or consumer protections.

We can do both by focusing on technology that has the potential to impact Californians. High risk automated decision making systems. California can put forth common sense regulations while protecting our values. At the same time, a regulatory framework in the private sector, the private sector, and tying this to California's procurement process.

We can ensure companies comply with regulations set forth to protect Californians who are seeking access to the benefits provided by their government.

SB420 seeks to regulate the development and deployment by both public and private sectors of high risk ads by requiring an impact assessment to evaluate their purpose, use of data, potential for bias and steps taken to address those risks.

This Bill requires that individuals that are subject to ads know and have knowledge when the tool is being used to make decisions about them. Details about the ads utilized and where technically feasible, the opportunity to appeal such decisions for review by a neutral party. And with that, Mr.

Chairman, I'm happy to answer questions and/or respectfully ask your aye vote.

Thank you very much. Those in support, please approach the microphone. SB420 seeing no one approaching the microphone. Those opposed to SB420 please approach the microphone.

Thank you Mr. Chair. Members. Ronak Daylami with Cal Chamber, respectfully in opposition to SB420. We appreciate the author's interest in working on this very important issue, especially given that this is an area of public policy that we ourselves have been working on going on three years now.

And we absolutely agree bias and discrimination are serious problems and we both want and need to be part of this solution. Whether decisions are being made by humans from start to end or byproduct of using or incorporating new technologies, algorithmic discrimination is discrimination because our laws are rights-based and not technology-specific.

Affirming that principle and requiring assessments is both reasonable and responsible. But the key is to avoid over regulation and the creation of a chilling effect on the technology that will only undermine its utility and improvement, both stifling its beneficial application and leading to the opposite outcome intended .

ADS can, for example, enable faster approvals and expanded access to credit. It can enhance real time fraud detection, foster job creation in new industries, address major societal challenges such as economic inequality and climate change. It can even advance new treatments for previously incurable diseases.

And while ADS may pose unique challenges, they also pose unique advantages as well. This could lead to enhancing fairness and accountability if properly developed and deployed, particularly in comparison to human driven systems which may be equally if not more flawed.

For example ADS decision-making processes, processes can be more transparent and traceable and offer opportunities for detection and correction that can be more challenging to come by in human decision processes where human bias is often more subtle and harder to detect. Our members are confident that there is a way to thread this needle without these unintended effects.

But it starts by focusing on high risk ADS that replace human decision making that have legal or similarly significant effect. While SB 420 currently goes beyond that and captures lower risk ADS. We have had productive conversations with the author and we look forward to continuing that work with the Senator in hopes of landing on a balanced policy that will achieve the goal that I think we all share. So I thank you and we thank the Committee.

Thanks. Thank you. Next witness of opposition. Okay, it sounds like we have tweeners out there, so.

I'm not alone in the tweener position, just Kimberly Rosenberger with SEIU we have concern. We don't have a hard line on this in part like the amendments taken today. We believe in this author and we hope there's a pathway where we can get to a place of support.

But 2025 is a very different time than 2024 and we have to take a hard line on ADS and tech and protect our California values. As it stands right now, the definitions. The governance is really concerning for us. And has too many loopholes. Thank you.

All righty. Next. Are you in opposition?

I'm a tweener. Is that what you call it? A tweener? Alright. Samantha Gordon, Tech Equity Action. We write with letter of concern, so we appreciate the author's intent and we know that we share values on establishing people-first AI.

But we believe the Bill needs to be strengthened in some key areas around the definitions, notice provisions, ensuring we are enforcing our existing anti discrimination laws and not inadvertently creating a two -tiered standard for discrimination and strengthening the enforcement mechanisms and ensuring there aren't exemptions.

We've shared with our committee before, as SEIU iterated, we believe that it's really important to establish these frameworks in a way that puts people first under our automated decision making systems.

We're concerned right now, in the bill's current form, it wouldn't provide necessary transparency measures that some of the definitions could allow companies to sidestep some of the accountability mechanisms that are being established. And we want to make sure people receive really sufficient notice and explanation of their rights.

All right, thank you very much. If you are a tweener, just identify with whom you agree and who you represent.

Hi, I'm Claire Conlon with Biocom California, the world's largest life science training association. And we're a tweener. We have concerns similar to page 15 and 17 from the analysis and we appreciate the author's outreach to our industry and look forward to working with you.

All right, thank you very much.

Good afternoon. Tweener as well. Mark Farouk with the California Hospital Association. We have concerns. Look forward to continuing conversations with the author. Thank you.

Hi. Robert Boykin with TechNet. Echo the comments made by the Chamber and opposition. Thank you.

Thank you.

Good afternoon. Naomi Padrone on behalf of the Computer and Communications Industry Association. We would echo the comments of the Chamber as well.

All right, thank you. Anyone actually in opposition? Seeing no one approaching. All right, let's bring it back to Committee for comments and questions. Seeing no. Yes. Okay. Sorry. Senator Durazo, Senator Wahab, then Senator Allen and then Senator, okay, then Senator Wiener. Okay. Senator Durazo.

Thank you. Mr. Chair, a couple of issues that I hope that you'll include in your list of things. One is small businesses being exempted by size rather than impact. And just to give an example, when Instagram was purchased in 2012 for $1 billion, it only had 13 employees of record and 30 million users.

So using that is a. And then grandfathering in the use of ADS, even where there's identified or currently occurring disparate treatment or discrimination. So that should be taken into account before grandfathering in anybody. Thank you for all that you're doing.

All righty. Thank you.

Senator Wahab.

Thank you.

I just want to be able to extend an opportunity for you to respond to TechEquity's concerns. Would you like to elaborate a little bit more on, you know, some of their opposition?

If you could be a little more specific about the ones that you're concerned with, because there's a few and it's an evolving conversation.

So the EU in particular. And then I have a couple more if you want.

I think as I, Mr. Chairman, Senator, thank you for the question. I think as I indicated at the outset, this is a broad Bill that seeks to accomplish a fairly broad impact given the fast, rapid evolvement of these technologies and how they're used to decision making that affect real people.

Because it is broad, it's complex and there are a lot of concerns. So our approach to the Bill tactically and strategically has been let's look at some existing frameworks and let's take elements of those frameworks, including from the European Union and others.

And the analysis points out, I think correctly, that they're not a one to one adaptable comparison. And there are different elements in 420 here that don't exist in that framework.

I think the concerns are that there will be, particularly with the definitions, an inadvertent application of those in ways that will affect standards or characterized decision making as potentially prejudicial or problematic that really isn't. And I just want to clarify for the record that's not my intent and that's not where I want this Bill to go.

And we're going to be very willing to continue having that dialogue with stakeholders so we can refine that.

Okay. And then SB420 does not have a pre-use or post-use notice. Is this something you would consider adding? So consumers and workers are aware of the ADS systems before engaging with them and what the systems utilize during their engagement.

The noticing has been a topic of conversation, one that we're balancing and we'll continue working with them to resolve

Okay. And then I have stated publicly in this Committee before that I'm not a big fan of the two-tiered standards. Right. And I just want to, especially when we're talking about discrimination or things like that. What is your response to the concerns about that?

Mr. Chairman? Senator, I hear them loud and clear. And I, and I, I, I accept them as a valid point. And, and it is our desire to not inadvertently create something that is in effect, a dual two-tiered system.

We have to be sure that we're consistent with the existing statutory scheme, history of enforcement, and that we are strengthening that and not duplicating.

Okay. And so just for the record, I, I very much specifically don't like two-tiered systems. I think that I've voted very clearly on this in the past, probably the sole vote. So I will be supporting this, you know, as things are moving along, working on it.

But I just wanted to flag some of my concerns, which I do share with some of the opposition groups. But I also understand that as we're talking about new technology, different things are brought up and I want to give you an opportunity to work on it. Thank you.

Thank you, Senator.

All right. Thank you, Senator Allen. All right. And Senator Wiener.

Thank you, thank you, thank you for the Bill, Senator. I'll be supporting it. I do just want to echo.

I know this is the first committee and just the beginning, and I'm sure you'll be doing work to make sure this is really as tight and crisp as it needs to be, given what's happening at the federal level where they're literally just eliminating any and all, even guidance around AI it's critically important.

The world's looking to California, as you know, and we have to make sure that we get it right. And I'm sure that you're committed to that work, and so I appreciate it and I'll be supporting it.

All right. Thank you. Senator Wiener, other comments or questions? Seeing none, Senator Padilla,

Respectfully ask for aye vote.

All right, thank you. Committee Assistant Porter, please call the roll.

This is File item number 7, SB 420. The motion is do pass to Senate, to the Senate Governmental Organization Committee.

[ROLL CALL]

9-0. We'll put that on call.

9 to 0.

Next, Senator Cortese, who's been waiting patiently and I know you're also chairing a Committee at this moment. And then to Senator Wahab for item number 16, SB522. All right, Senator Cortese.

Thank you, Mr. Chairman.

Thank you very much. Mr. Chair and Committee Members, I'm pleased to present SB683, which will help eliminate endless exploitation in California. I'll be accepting the Committee amendments as outlined on page six of the analysis. I think they're printed out very clearly there, and I appreciate the help from the Committee and really squaring that language away.

We needed that. SB683 strengthens protections for individuals by codifying the right to seek a civil remedy, temporarily removing unauthorized materials within two business days, pending review and adjudication. Current law prohibits the unauthorized use of another's name, voice, signature, photograph, or likeness in any manner without consent. Yet we continue to see prevalent misuse.

The exploitation of one's likeness can have serious social, mental, and economic ramifications, as I think we all know. But given the increasing sophistication of commercial entities to promote materials, it's imperative that the law be equipped to provide individual protection.

So this bill clarifies that an individual seeking relief for a violation of name, image, and or likeness may seek an injunction or a temporary restraining order, commonly referred to as a TRO. Should a TRO be granted, the respondent must comply within two business days from the day the order is served, unless the order requires faster compliance.

This law has not been updated in over 40 years. We're dealing with one recommended specific remedy in the bill, recommended by the bill itself, but we're not changing any of the other remedies. The original intent still stands true. Our laws must provide protection to the individual person from an invasion of privacy.

Not only do authorized users suffer, but consumers can be misled by false likeness, and owners lose compensation, career opportunities, and potentially the reputations. Thank you. And I respectfully ask for your Aye vote. All righty.

Witnesses in support of SB683, please approach. Seeing no witnesses approaching in support. Let's turn to opposition. If you're opposed to SB683, please approach the microphone. Seeing no one approaching the microphone. Let's bring it back to Committee for questions. Comments? Seeing no. Yes. Senator Allen, just commend the author and move the bill. Senator Allen is commended and moved.

Any other questions or comments? All right. Senator Cortese, would you like to close? Yes. Mr. Chair, respectfully ask for your Aye vote. Thank you. We'll let you get back to your Committee. All right. Chief Assistant Porter, please call the roll.

This is File item number 3. SB 683. The motion is to pass as amended to Senate Appropriations. [Roll Call]

10. 0. We'll put that on call. All right, next. Senator Wahab, SB522.

Thank you. Chair, Colleagues, and members of the public, I want to thank the Committee Staff for their engagement on this Bill. SB 522 simply extends Just Cause for eviction protections to units previously covered by the Tenant Protection Act.

The Just Cause for Evictions Provision of the Tenant Protection Act are based on the certificate of occupancy date for the unit. This becomes problematic when units covered by these provisions are destroyed in a disaster. When rebuilt, these units have certificate of occupancy dates that exclude them from the provisions of the TPA.

Just Cause for Eviction Protections are one of the most basic ways we can keep people housed. And by protecting units previously covered under the TPA, we stabilize communities rebuilding after a devastating disaster. Contrary to the Opposition Letter, the Bill in no way adds rent control or impedes construction.

And SB 522 is only about the TPA's Just Cause for Evictions Provisions. With me, I'd like to introduce my witness, Los Angeles City Attorney, Hydee Feldstein Soto.

All right, Madam City Attorney, floor is yours.

Thank you. Thank you, Chair. Thank you, Members, and thank you Senator Wahab for authoring the Bill and Senator Allen for co-authoring. It should come as no surprise. It's in all the news. Our city lost about 60 rent-stabilized buildings in the Palisades Fire.

That is a total of 778 affordable rental units, in a city that has a well-documented shortage of affordable housing. That is about 3/4 of all of the rent-stabilized units in the Palisades, which is a catastrophic loss for a community. 22 rent-stabilized properties were damaged and three mobile home parks were also devastated by the Fires.

SB 522 would very effectively augment the protections of the Governor's Executive Order of February 13, 2025, which set forth the conditions for streamlined approvals of buildings destroyed in LA fires. These renter protections are not really an expansion of rent control anywhere in the state.