When a 1960s Privacy Law Becomes a Weapon Against Small Businesses

May 2, 2026 - 17:22

A law written in the 1960s, long before the internet existed, is now being twisted into a tool for extorting small business owners across California. The California Invasion of Privacy Act, originally designed to stop wiretapping and eavesdropping, is increasingly used to file lawsuits against businesses that use common website chat tools or analytics software.

The problem centers on session replay software and chatbots. These tools record how visitors interact with a site, helping businesses improve customer service. But plaintiff lawyers argue that any third-party software capturing keystrokes or mouse movements without explicit consent violates the old wiretapping statute. The result is a flood of class-action lawsuits, often demanding thousands of dollars per website visitor.

Small businesses, from bakeries to auto repair shops, are the primary targets. They cannot afford the legal fees to fight these cases, so many settle for thousands of dollars they do not have. The law was never meant for this. It was written to stop people from tapping phone lines, not to punish a florist for using a live chat plugin.

Sacramento needs to step in. Lawmakers should clarify that standard website tools are not wiretapping devices. Until they do, small business owners are left paying the price for technology the 1960s never imagined.