Tennessee Information Protection Act

What you need to know about the TIPA:

To Whom Does TIPA Apply?

TIPA applies to for-profit entities that:

  1. Conduct business or provide products or services to residents of Tennessee (consumers), and 
  2. Exceed $25 million in annual revenue, and
  3. Annually controls or processes the PI of either:
    • 175,000 residents; or
    • 25,000 residents and derives more than 50% of gross revenue from the sale of PI.
Where Does TIPA NOT Apply?

Exempt Entities: Exempt entities include:

  • Non-profits;
  • State government entities;
  • Higher education Institutions;
  • Insurers;
  • HIPAA-covered entities; and
  • GLBA-covered entities.

Exempt Data:  TIPA exempts a long list of personal information, including but not limited to:

  • Protected Health Information (PHI) under HIPAA;
  • GLBA covered data;
  • Various federally and internationally protected health and patient information, including that protected by the Common Rule, human subject data, and more;
  • Various forms of credit data regulated by the Fair Credit Reporting Act; and
  • Data covered by a wide variety of other federal laws including the Family Educational Rights and Privacy Act, Farm Credit Act, and Driver’s Privacy Protection Act.

Exempt Use Cases: TIPA is not applicable in some circumstances, such as: processing PI in an employment or commercial (B2B) context;

  • Conducting internal research for development, improvement, and repair of products, services, and technology (R&D);
  • Product recalls;
  • Identifying and repairing technical errors that impair existing or intended functionality; and
  • Performing internal operations.

Key Components of TIPA

What Constitutes Personal Information in TN?

TIPA covers “personal information” (PI), which Tennessee defines as any information that is linked or reasonably linkable to an identified or identifiable natural person.

The definition exempts de-identified and information made publicly available by government records, the media or the consumer.

What Constitutes Sensitive PI?

Sensitive PI in TIPA consists of:

  • Racial or ethnic origin;
  • Religious beliefs;
  • Mental or physical condition or diagnosis;
  • sexual orientation;
  • Citizenship or immigration status;
  • PI about a known child;
  • Precise geolocation data (identifies the specific location within a radius of 1750 feet); and
  • Genetic or biometric data for the purpose of identification.
Any Other Categories of Data I Should Think About?

Where a controller processes de-identified data, Tennessee requires it to take reasonable measures to ensure the data cannot be associated with an individual; publicly commit to maintaining such data without an attempt to re-identify it; and contractually obligate any recipients of the data to comply with TIPA.

TIPA also exempts pseudonymous data from all privacy rights requests where the controller can show it keeps information that would allow the data to be re-identified separate and subject to technical and organizational controls that prevent its use for re-identification.

Is Consent Needed To Process Sensitive PI?

In a word: Yes!

Is Consent Needed for Any Other Processing?

Parental consent is required to process PI about a known child (younger than 13) in accordance with COPPA.

Consent is also required prior to processing PI for purposes that are not reasonably necessary to or compatible with the business purpose for which the information was collected and notified to the consumer.

What Needs To Be Included in the Privacy Notice?

Under TIPA, a privacy notice must include:

  • The categories of PI processed;
  • The purpose for processing PI;
  • The categories of third parties to which PI is sold, if any;
  • The categories of PI that are sold to third parties, if any;
  • Privacy rights; and
  • The methods for a consumer to exercise their privacy rights (see below) and appeal a rights decision.
What Constitutes “Sale” of PI?

Tennessee defines “sale” as an exchange for valuable monetary consideration, more limited than many state privacy laws that also include “other” valuable consideration. This requires that the monetary consideration be valuable (not nominal) for any exchange of PI to be a sale.

There are limits on the definition of “sale” to ensure that certain business functions are not unintentionally impeded by this law. Examples of activities deemed not to be a sale include: the disclosure of PI to provide a product or service requested by the consumer, the disclosure of PI that the consumer intentionally made available to the public, and the disclosure of PI as part of a merger or bankruptcy.

How Will TIPA Be Enforced?

The state Attorney General (AG) has sole enforcement authority under TIPA. Under the law, the AG may bring an enforcement action after providing 60 days’ notice and an opportunity for the business to cure the alleged violation(s). This cure period does not sunset. Penalties may include injunctive relief (the company must immediately stop certain behaviors) and/or fines of up to $7,500 per violation, plus attorney’s fees, investigative costs, and any other relief the court determines appropriate. For willing or knowing violations, the court can award triple damages.

Uniquely, TIPA offers a safe harbor for entities that voluntarily implement and maintain a privacy policy compliant with the NIST Privacy Framework. Importantly, this is not an exemption from TIPA. With this statute, if an entity maintains a voluntary privacy program that meets the safe harbor conditions and if a cause of action for an alleged violation of TIPA is brought against the business, that voluntary program can serve as protection against monetary fines.

Data Privacy is Just Good Business