Online businesses always collect data: user signups, newsletter subscribers, payment information, analytics, and more. However, many startups don’t realize that this data is protected by law. California and New York have rules defining how companies can collect, use, and share personal information. Ignoring those rules can lead to expensive fines and public trust issues.
This article explains what new and growing businesses need to know about data law in these two key states.
What Counts as Personal Data?
Personal data is any information that identifies a person. This includes names, email addresses, IP addresses, geolocation, and browsing behavior. Sometimes, it also includes device identifiers or user profiles created by third-party tools.
If your website tracks users or collects email addresses, you’re handling personal data. This means you must comply with state and federal privacy laws.
Why California and New York Matter
California and New York are two of the most active states regarding data privacy. California introduced the California Consumer Privacy Act (CCPA), which gives residents the right to know what data companies collect about them and how they are used. The law also allows users to opt out of the sale of their data.
While New York has not yet enforced a law as broad as CCPA, it is closing the gap with proposed legislation like the New York Privacy Act. The state has also stepped up enforcement through the Department of Financial Services, focusing on cybersecurity and consumer protection.
If you do business in either state or collect data from residents there, these laws apply to you. A data law firm in California or a data privacy lawyer in New York can help assess your exposure and build a compliance plan.
What Startups Often Miss
Startups move fast. It’s easy to focus on growth and leave legal steps for later. But ignoring privacy regulations can lead to serious trouble.
Here are some common mistakes:
- Using cookie trackers without disclosing it
- Collecting emails without explaining how they’ll be used
- Forgetting to add a privacy policy to the website
- Sharing data with vendors or platforms without checking compliance
Many of these seem small, but regulators take them seriously. California, in particular, has already fined businesses for failing to follow basic CCPA rules.
Key Requirements in California
If you serve California residents, your business might need to:
- Provide a clear and accessible privacy policy
- Let users know what personal data you collect and why
- Allow users to request access to or the deletion of their data
- Give users a way to opt out of having their data sold
Even small startups can be subject to these rules if they collect enough data or work with third parties that do.
A data law firm in California can help you determine which parts of the law apply to your setup and what steps to take next. These could include revising your privacy policy, creating opt-out buttons, or updating cookie banners.
What About New York?
New York hasn’t passed a CCPA-style law yet, but that doesn’t mean you’re off the hook. You still have legal obligations if your business handles sensitive customer data like email addresses, health info, or financial details.
New York regulators expect businesses to take “reasonable safeguards” when storing or transferring data. That could mean using encryption, creating internal security policies, or limiting who has access to personal data.
Hiring a data privacy lawyer in New York helps ensure you’re not overlooking gaps in your privacy practices. They can help draft terms of service, review vendor contracts, and guide you through compliance requirements that may come from industry-specific rules.
Tips to Start Off Right
Here’s how early-stage companies can build a solid foundation for data privacy:
- Write a plain-language privacy policy and make it easy to find on your website
- Use cookie banners that let users accept or decline non-essential cookies
- Avoid collecting more data than you need
- Review your tools and platforms to see how they handle user data
- Talk to a privacy lawyer if you’re unsure about state requirements
Most of these steps don’t require significant tech changes. They just need some time and a plan. Getting things right from the beginning will save you money and protect your company’s reputation later.
