Author: JOLT Page 9 of 50

By: Joey Rugari

Image Source: https://pixabay.com/illustrations/business-word-cloud-bitcoin-3325386/

In 2009, Bitcoin was first introduced to the world.[1] It began a never before seen form of currency, called cryptocurrency.[2] This new system of currency did not require a centralized institution, or intermediaries to handle transactions.[3] Encrypted transactions kept buyers and sellers secret, but a decentralized public ledger meant that anyone who used the currency could see that the currency had been used – the Bitcoin network kept track of every transaction, so everyone in the network could see that whether the transaction was legitimate.[4] On top of all of this, Bitcoin introduced the concept of the blockchain, and peer-to-peer systems of transactions in general, to the world as an alternative to the traditional systems.[5] So why, then, are the traditional systems so much more enticing, even today?

Establishing a peer-to-peer system of laws or currency will inevitably have to face its greatest challenge in the simplest principle – innovation for innovation’s sake is pointless. Why would one seek to develop a governing framework that is confusing and complex when the traditional alternative is just as, if not more, capable of achieving those same goals?[6] It would seem that the place that such systems would be most valuable are those areas where the traditional systems are at their weakest.[7] Of particular interest are those areas of law and governance with endemic corruption or where agency costs are particularly high.[8] Like high-level corporate decision-making[9], or general currency transactions.[10]

Naturally, that’s where the principles behind blockchain currencies are being strained.[11] If the notion is that transparency of a distributed ledger will protect from predatory practices, then examples of the technology being used to contravene those principles would need to be definitively addressed. Which is why it is of particular note that North Korea has recently started flirting with the notion of cryptocurrency as a method of circumventing international trade sanctions, in the vein of the “petro coin” stunt of Venezuela.[12] While these sorts of claims seem ludicrous, the reasoning in which they are based[13] should be of concern to anyone watching the evolution of blockchain tech, in particular with regard to the current regulatory regimes surrounding currency and security transactions.

And they are. The IRS has taken notice of cryptocurrency as a problem area in modern transactions.[14] Cryptocurrency is an asset like any other and plays a role in the total value of a person’s finances.[15] The problem lies in the dual nature of cryptocurrency, containing aspects of both currency and of securities.[16] While it doesn’t make asset valuation impossible, it does create complications with determining that one actually has cryptocurrency on hand.[17] The peer-to-peer system makes it entirely possible to keep the value of the assets from being included in a complete financial valuation without specific audit due to the fact that, since cryptocurrency is not truly legal tender, it will generally not be readily regulable without there being some form of cryptocurrency sale in which legal tender is received.[18]

An answer to the question posed at the beginning is not likely to be available in a mere six hundred or so words. However, it’s not like this is all just some small issue that will eventually disappear into the void. The great experiment of blockchain technology is still in flux. Theoretical expansion of peer-to-peer systems extends into more and more areas where centralized institutions traditionally stand. Bitcoin lit the spark, and the flame has been burning low and slow ever since. But it’s clear that cryptocurrency is going nowhere, and that blockchain is likely to remain in some form or another as the experiments continue.[19] It’s simply a question of whether regulatory systems can properly integrate the technology into their frameworks as its reach grows. The matters above are but a smattering of the possibilities. It may even never truly take hold. Honestly, the whole thing’s pretty exciting.

[1] See Joshua Davis, The Crypto-Currency: Bitcoin and its Mysterious Inventor, New Yorker, Oct. 10, 2011, at 62.

[2] See Id.

[3] See Id. at 65.

[4] See Id.

[5] See Id.

[6] See Michael Abramowicz, Cryptocurrency-Based Law, 58 Ariz. L. Rev. 359, 371 (2016).

[7] See Id. at 365-66.

[8] See Id. at 365.

[9] See Id. at 361.

[10]See Neil Tiwari, The Commodification of Cryptocurrency, 117 Mich. L. Rev. 611, 618-619 (2018).

[11] See David Gilbert, North Korea is Building Its Own Bitcoin, Vice News (Sept. 18, 2019), https://www.vice.com/en_us/article/9ke3ae/north-korea-is-building-its-own-bitcoin.

[12] See Id.

[13] See Id.

[14] Michael Cohn, IRS Small Business Unit Pivots to Cryptocurrency Enforcement, Accounting Today (Sept. 19, 2019, 4:54 PM EDT), https://www.accountingtoday.com/news/irs-small-business-unit-pivots-to-cryptocurrency-enforcement.

[15] See Id.

[16] See Tiwari, supra note 10, at 614.

[17] See Id.

[18] See Id. at 623-24.

[19] See, e.g., Gilbert, supra note 11.

By: Jacob Newton

Image Source:https://www.apple.com/newsroom/2019/08/apple-card-launches-today-for-all-us-customers/

Apple, in partnership with Goldman Sachs, recently released its new Apple Card to the United States on August 20, 2019.[1] The card is aesthetically pleasing, heavy duty, and works in sync with Apple products.[2] The motto for Apple’s card is “a new kind of credit card . . . [c]reated by Apple, not a bank.”[3] The company claims the card stands for “simplicity, transparency, and privacy.”[4] However, Apple’s new credit card comes with an old credit card trick. Credit card companies have long been aware of the average consumers failure to read terms and conditions of anything before agreeing to them. These credit card companies, now including Apple, take full advantage of the lacking consumer diligence in the form of pre-dispute arbitration clauses.[5] The terms and conditions of the Apple Card customer agreement specifically state the cardholder agrees to arbitration in all matter brought by and against Apple or its affiliate and precludes class action suits.[6] Pre-dispute arbitration clauses, like the one in Apple Card’s terms and conditions, have a colorful and controversial history.

Arbitration clauses are governed by the Federal Arbitration Act (FAA).[7] Under the FAA, an arbitration agreement is no different from any other contract,[8] which means courts have to apply basic contract law to decide whether a valid agreement to arbitrate exists.[9] At the time, these clauses seemed to limit class action suits through mandatory enforcement of arbitration agreements. This was confirmed in a 2013 Supreme Court decision, which gave pre-dispute clauses more teeth in holding the FAA does not allow courts to invalidate class-action waivers just because the cost of individual arbitrations exceeds the plaintiff’s potential recovery.[10] The New York Times and the Consumer Finance Protection Bureau (CFPB) brought the general public’s attention to pre-dispute arbitration clauses in 2015 when the Times ran a series detailing the effects of these clauses found in a study conducted by the CFPB.[11] The article highlighted how pre-dispute arbitration clauses allow corporations to circumvent the courts and bar people from joining together in class-action lawsuits.[12]

In response to public outrage, the CFPB issued a rule to regulate arbitration agreements in contracts for specified consumer financial product and services in July 2017.[13] The rule would not have allowed companies to force consumers into arbitration and bar class action suits.[14] Following a corporate uproar, four months after the rule came into effect, the President signed a joint resolution passed by Congress disapproving the Arbitration Agreements Rule under the Congressional Review Act (CRA).[15] The future looked bleak for consumers when the CFPB removed the arbitration agreement rule from the Code of Federal regulation,[16] but all was not lost for consumers. In many jurisdictions, a consumer could still go after the unconscionability of the arbitration clause in Court, even though the arbitration clause contractually binds the consumer to handle all claims through arbitration, because the validity of the contract is severable from the rest of the agreement.[17] Many Corporations, such as Uber for example, have successfully circumvented the unconscionability argument by including an “opt out” provision.[18] These provisions allow consumers to opt out of the pre-dispute arbitration clause within a certain time frame.  A new problem then arises, due to the lack of consumer knowledge of their ability to opt out.

What does all of this confusing pre-dispute arbitration clause law mean for new Apple Card owners? Simple, it means read the terms and conditions of the customer agreement before agreeing to them. The Apple Card arbitration clause, located in the terms and conditions, have an opt out provision.[19] It requires the consumer to notify Apple by message, phone, or letter; within 90 days of opening the account, to express they are exercising their right to reject the arbitration provision.[20]

In accordance with today’s reality, most people do not read the terms and conditions   of anything anymore. For the majority of people who check the “I Agree” box and move on with their lives, a potential for hope still looms in the form of “The Forced Arbitration Injustice Repeal Act” (“FAIR Act”).[21] On February 28, 2019, U.S. Representative Hank Johnson and U.S. Senator Richard Blumenthal introduced the FAIR Act “which seeks to (1) prohibit pre-dispute arbitration agreements that force arbitration of future employment, consumer, antitrust, or civil rights disputes, and (2) prohibit agreements and practices that interfere with the rights of individuals, workers, and small businesses to participate in a joint, class, or collective action related to an employment, consumer, antitrust, or civil rights dispute.”[22] The Bill has an uphill battle, but has the potential to make a major impact on pre-dispute arbitration agreements.

[1] See Apple, Apple Card launches today for all US customers, Apple Newsroom. (Aug. 20, 2019), https://www.apple.com/newsroom/2019/08/apple-card-launches-today-for-all-us-customers/.

[2] See Apple, https://www.apple.com/apple-card/?rid=287-cid%3Dapy-311-100000070000-100000000000025-301100000000066 (last visited Sept. 18, 2019).

[3] See id.

[4] See id. (stating “[i]t represents all the things Apple stands for. Like simplicity, transparency, and privacy.”)

[5] See CFPB Study Finds that Arbitration Agreements Limit Relief for Consumers, Consumer Fin. Protection Bureau (Mar. 10, 2015), www.consumerfinance.gov/about-us/newsroom/cfpb-study-finds-that-arbitration-agreements-limit-relief-for-consumers (“The CFPB’s research indicates that tens of millions of consumers are covered by arbitration clauses in the consumer finance markets studied. For example, in the credit card market, card issuers representing more than half of all credit card debt have arbitration clauses – impacting as many as 80 million consumers. “).

[6] See Apple Card Customer Agreement 14, Goldman Sachs, https://www.goldmansachs.com/terms-and-conditions/Apple-Card-Customer-Agreement.pdf (last visited Sept. 18, 2019).

[7] See Federal Arbitration Act, 9 U.S.C. §§ 1-16 (2012).

[8] See id. at § 2.

[9] See Brann & Isaacson, Optional Arbitration Programs: Opting In vs. Opting Out, 24 No. 7 Me. Emp. L. Letter 1 (2019).

[10] See Am. Express Co. v. Italian Colors Rest., 570 U.S. 228 (2013).

[11] See Jessica Silver-Greenberg & Robert Gebeloff, Arbitration Everywhere, Stacking the Deck of Justice, N.Y. Times (Oct. 31, 2015), http://www.nytimes.com/2015/11/01/business/dealbook/arbitration-everywhere-stacking-the-deck-of-justice.html?_r=1. (involving the negative effects of American Express and other companies’ mandatory arbitration clauses to consumers); Liz Kramer, Beyond the Headlines Part II: What the New CFPB Report Teaches Us About Arbitration v. Litigation, Arb. Nation (Mar. 12, 2015), http://arbitrationnation.com/beyond-the-headlines-part-ii-what-the-new-cfpb-report-teaches-us-about-arbitration-v-litigation (stating that the CFPB’s study in 2015 found that Of the 158 cases in which the consumer had an affirmative claim, arbitrators provided consumers with relief in 20% of them and of the 244 affirmative claims by companies that resulted in an award, arbitrators provided the companies relief in 93% of those disputes).

[12] See id.

[13] See 82 FR 55500 (Nov. 22, 2017) (to be codified at 12 C.F.R. pt. 1040).

[14] See id.

[15] See Act of Nov. 1, 2017, Pub. L. No. 115-74, 131 Stat. 1243.

[16] See 82 Fed. Reg. 33210 (Sept. 18, 2017) (to be codified at 12 C.F.R. pt. 1040) (giving notice of invalidation of 82 FR 55500 (Nov. 22, 2017) (to be codified at 12 C.F.R. pt. 1040)).

[17] See Rent-A-Center, W., Inc. v. Jackson, 561 U.S. 63, 70-71 (2010) (holding held that the agreement’s delegation of authority to the arbitrator to decide whether the agreement was valid was severable from the rest of the agreement, such that a challenge to the validity of the delegation provision itself was required before a court could intervene).

[18] See Suarez v. Uber Techs., Inc., 2016 U.S. Dist. LEXIS 59241, at *14 (M.D. Fla. May 4, 2016) (giving considerable weight against unconscionability to the “op-out” provision and the fact the driver did not opt out).

[19] See Goldman Sachs, supra note 6, at 15.

[20] See id.

[21]See H.R. 1423, 116th Cong. (2019).

[22] Garen Dodge & David Alvarez, New Federal Legislation Seeks to Eliminate Mandatory Arbitration Agreements, Labor & Employment L. Blog (March 21, 2019), https://www.laboremploymentlawblog.com/2019/03/articles/arbit ration-agreements/mandatory-arbitration-agreements/.

By: Rachel Whalen

Image source: https://memory-alpha.fandom.com/wiki/Star_Trek:_The_Animated_Series

 

Space, the final frontier. Star Trek explores the universe and the potential consequences of a post-scarcity society. This fictional world has “eliminated hunger, want, [and] the need for possessions”[1] and developed a society that does not rely on money.[2] People in this sci-fi world have access to any resources that they need through the use of replicators.[3] This unlimited supply of resources removes much of the incentive for people to work and create, and the lack of scarcity would require a whole new approach to economics.[4]

 

Intellectual property (IP) rights already create artificial scarcity where scarcity would not normally exist.[5] The ideas and creations protected under IP rights would otherwise be freely available.[6] IP law restricts the proliferation and copying of information in order to provide an incentive for creativity.[7] Historically, developing an idea or creation has required resources such as raw materials and human labor. Creators and innovators relied on IP law to recoup their costs and protect their creations. “It is cheaper to be an imitator than an inventor,” so an incentive is needed to encourage innovation.[8]

 

However, in the case of a post-scarcity world, the costs to innovate would be very small if any. Without the scarcity of raw materials and time, people in Star Trek’s utopia can focus on creation and individual fulfillment.[9] The costs to create and distribute content would be almost nonexistent, so IP law would not be as necessary to recoup costs of creation when creation is free.

 

Furthermore, the foundation that monetary enticement is required to promote innovation has been placed into question. People may not be as motivated to create by external rewards as internal or problem driven gratification.[10] For example, the development of the internet has revealed an astonishing amount of people creating content, at their own cost, for free distribution. These people simply want to share their creations with the world,[11] and with a low cost of creation, they would have even greater access to innovate. In this case, the protections provided under IP law would be less important as the incentive to innovate is no longer as necessary.

 

On the other hand, content creators may still desire IP protections for them to control the use and distribution of their content. As economists Michele Boldrin and David K. Levine pointed out, “[I]ntellectual property law is really about . . . your right to control my copy of your idea.”[12] Creators may want to protect the reputation of their work and be acknowledged as the creator.

 

Star Trek represents a world without scarcity and without the related costs for creation and distribution of ideas. IP law has traditionally helped creators recoup the costs of creation in order to promote innovation over replication. In a post-scarcity world, the costs for creation are almost nonexistent as materials are freely available. IP law has also stood on the presumption that creators want monetary rewards for their work, but the plethora of people creating and freely distributing content on the internet suggests a different motivation. Content creators want to share their creations and be acknowledged. Still, without the initial costs of creation and distribution, the incentive provided by IP protections drops in importance as more people have access to innovate. While IP law has a place in a post-scarcity world, it is not likely to rely as heavily on IP protections.

 

 

 

 

[1] See Jonathan Newman, Star Trek Is Wrong: There Will Always Be Scarcity, Mises Wire, Oct. 20, 2015, https://mises.org/library/star-trek-wrong-there-will-always-be-scarcity.

[2] See Rick Webb, The Economics of Star Trek, Medium, Nov. 6, 2013, https://medium.com/@RickWebb/the-economics-of-star-trek-29bab88d50.

[3] See Peter Frase, Anti-Star Trek: A Theory of Posterity, Dec. 14, 2010, http://www.peterfrase.com/2010/12/anti-star-trek-a-theory-of-posterity/.

[4] See Mark A. Lemley, IP in a World Without Scarcity, 90 N.Y.U.L.R. 460 (2015).

[5] See id.

[6] See id.

[7] See id.

[8] Id.

[9] See Webb, supra at 2.

[10] See Lemley, supra 4.

[11] Id.

[12] Frase, supra at 3.

By: Will Garnett

Image source: https://medium.com/themap/how-to-work-with-government-open-data-77a8bee35ea1

Is your private information safe in the hands of the government? Only 12% of adult tech users polled in 2016 said that they were very confident in the ability of the federal government to protect their data, while 28% said they were not at all confident in that ability.[1] With recent news stories of data breaches, it is no surprise that people fear that their private information is unsafe.[2]

 

This month, Vice reported on state DMVs selling the private information of drivers to third parties.[3] This practice is permitted by law under the Drivers Privacy Protection Act, which allows personal information collected by the DMV to be disclosed for certain permissible uses.[4] These permissible uses range from employer verification of personal information to prevent fraud, to use by private investigative agencies.[5] The former is benign, and likely very useful to those seeking employment, eliminating tedious paperwork in the hiring process.[6] The latter could be a cause for concern, as private investigative agencies can be manipulated into aiding criminals, as was the case in Rebecca Scheffer’s murder.[7] A stalker may contact a private investigator to obtain DMV records containing the home address of his victim. While the benefits and dangers are known to state DMVs, they continue to sell DMV data to businesses and private investigators; Virginia DMV records show that it sold driver’s personal information to 109 investigative firms.[8]

 

Some state DMVs are collecting a significant amount of revenue from the sale of drivers’ data; Wisconsin made $17 million from the sale of drivers’ data in 2018 alone.[9] Access to a single record from the DMV has been sold for as little as $0.01.[10] Citizens of states that continue this practice have a choice to make. Will they allow the sale of their information to continue, even when it means depriving their agencies of significant revenue? Will it take another tragedy to cause new legislation to be written for this digital age? It remains to be seen whether there will be legal challenges to this newly uncovered practice on privacy grounds, but the truth is out.

 

[1] See Pew Research Center, Share of adults tech users in the United States who are confident in the ability of selected institutions to protect their data as of May 2016, Statista, https://www.statista.com/statistics/270062/legal-protection-of-us-internet-users-online-privacy (last visited September 08, 2019).

[2] See Chris Grundy, All Data Breaches in 2019 – An Alarming Timeline, Self Key (June 12, 2019), https://selfkey.org/data-breaches-in-2019.

[3] See Joseph Cox, DMVs Are Selling Your Data to Private Investigators, VICE (Sep. 6, 2019), https://tinyurl.com/y5ce5sx5.

[4] See 18 U.S.C. §2721 (2018).

[5] See 18 U.S.C §2721(b)(3-8) (2018).

[6] See Andrea Collatz, Using MVR Reports to Screen Potential Employees, TransUnion For Hires (Sep. 5, 2019) (explaining how employers can use DMV records to vet applicants), https://hires.shareable.com/blog/mvr-reports-screen-employees.

[7] See Natalie Flynn, The Still Terrifying Details of the Murder of Rebecca Schaeffer: A Star on the Rise and an Obsession Turned Deadly, E News (July 18, 2019) (detailing how a stalker found and killed a young actress by hiring a private investigator to obtain DMV records and the actress’ home address), https://tinyurl.com/y42wasoy.

[8] See Stephanie Pagones, Some state DMVs made millions selling drivers’ personal data for next to nothing, Fox Business (Sep. 9, 2019), https://www.foxbusiness.com/features/state-dmvs-drivers-personal-info.

[9] Id.

[10] Id.

By: Eric Richard

Image source: https://roselawgroupreporter.com/2019/09/ninth-circuit-strikes-down-montana-ban-on-political-robocalls/

We’ve all been the victim of robocalls. Everybody knows what it’s like to see an unknown number appear on their device, answer it for fear of missing an important message, only to be met with a voice on the other side that sounds like it was cobbled together from a bad sci-fi movie. Just this week, the 9^th U.S. Circuit Court of Appeals (the “Court”) leveled a decision to ensure these calls will keep coming.[1]

This past Tuesday, September 10, 2019, the Court reversed a district court decision condoning Montana’s Robocall Statute, thereby invalidating the law.[2] Montana passed this robocall law in 1991, the same year the federal Telephone Consumer Protection Act became effective.[3] The federal law bars political robocalls to mobile devices without prior consent, but it does allow robocalls to contact individuals via landlines.[4] By contrast, Montana’s law comes with a $2,500 fine for robocalls to any landline or cellular device that are related to a political campaign, as well as robocalls that aim to sell a good or service, solicit information or gather data.[5]

In past decisions, the Court has actually upheld laws that restrict robocalls based on consumer protection regulations and for those that restricted the time, place, and manner of the robocalls.[6] However, this most recent decision marks the limit as to how far the Court will go to regulate these types of calls.[7] In striking down the statute, the Court explained that regulating robocalls based on their content presented a more severe threat to First Amendment freedoms than regulating their time, place, and manner.[8] The Court also went on to say that prohibiting political robocalls strikes at the heart of the First Amendment…as well as disproportionately disadvantages political candidates with fewer resources.”[9]

Despite the past decisions advocating for regulating robocalls in accordance with specific parameters, the Court’s decision this month is actually in line with other recent trends across jurisdictions.[10] Specifically, the Court noted a 2015 decision by the 4^th Circuit.[11] There, a ban on all consumer and political robocalls was struck down in South Carolina because it was not narrowly tailored enough to protect the state’s interest in protecting privacy.[12] District courts in Wyoming and Arkansas have also held bans on political robocalls unconstitutional.[13] The 7^th Circuit did uphold an Indiana law regulating robocalls, but only because the statute did not discriminate by content and merely regulated who may be called.[14]

For those of us wanting increased protection from the incessant phone calls we receive almost daily, the Court’s decision this month, along with the trend it represents, isn’t encouraging. Some believe that the issue is primed for a Supreme Court decision, but the highest court in the land hasn’t taken it up yet.[15] Until then, we’ll have to look jurisdiction by jurisdiction to see which states do and don’t offer protection from robocalls, political or otherwise.

 

 

 

[1] See Debra Weiss, Ban on political robocalls violates First Amendment, 9^th Circuit rule, A.B.A. J. (Sept. 11, 2019, 12:51 AM), http://www.abajournal.com/news/article/ban-on-political-robocalls-violates-first-amendment-9th-circuit-rules.

[2] See Victory Processing, LLC v. Fox, No. 18-35163, 2019 U.S. App. LEXIS 27230 (9th Cir. Sep. 10, 2019)

[3] See Matt Volz, Court strikes down Montana law barring political robocall, AP News (Sept. 10, 2019), https://www.apnews.com/0cb788df7fe149f2847ab79ec7e3130b

[4] See id.

[5] See id.

[6] See Karina Brown, Ninth Circuit Strikes Down Montana Ban on Political Robocalls, Courthouse New Service (Sept. 10, 2019), https://www.courthousenews.com/ninth-circuit-strikes-down-montana-ban-on-political-robocalls/

[7] See id.

[8] See Victory Processing, LLC v. Fox, No. 18-35163 at *4.

[9] See id at *5.

[10] See Weiss, supra note 1.

[11] See id.

[12] See id.

[13] See Volz, supra note 3.

[14] See id.

[15] See id.

By: Monica Molouf

Image source: https://junkee.com/pokemon-go-still-thriving/196317

Pokémon Go experienced a recent financial setback[1] due to a class action settlement in California federal court.  In settling trespass and nuisance charges, the court ordered the company behind Pokémon Go to pay four million dollars in attorney’s fees and one thousand dollars to each individual plaintiff. [2]  Additionally, the court ordered the company to urge individuals to refrain from acts of trespass while using the app.[3]

This comes after numerous complaints that the app encourages trespass on private property.[4]  In their complaint for In re Pokémon Go, plaintiffs claimed Pokémon Go should be held responsible for “profiting from a game that encourages users to illegally wander onto private property.”[5]  Defendants argued that they were not responsible for individual user’s actions, but the federal court disagreed.

The sell for downloading the smartphone app is that “the world of Pokémon is all around you.”[6]  Meaning if you look through the proper lens—say, an app on my smartphone—you, too, could be Ash[7] and capture Pokémon as a trainer.

There’s something exciting about integrating a fantasy world into everyday life via virtual reality.  As the world’s “leading augmented reality” software company,[8] Niantic Inc. has capitalized on this excitement through Pokémon Go.  The app combines the fictional world originally experienced through trading cards and television shows with the real world, creating a quasi-virtual reality where Pokémon wander the earth.[9]  As pointed out in a response filed by plaintiffs, “[t]his innovative blending of physical and virtual worlds is the defining feature of Pokémon Go and the key to its popularity. Niantic emphasizes this heavily in its advertising, encouraging players to search far and wide to capture Pokémon and advance in the game.”[10]

The promotional video for Pokémon Go depicts 3D cartoons of the famous creatures roaming real cities, forests, and other exciting terrains.[11]  These are ambiguous spaces—never a distinct place in a familiar city, a backyard, or even a local park.  The video portrays beautiful scenery to match the fantastical virtual reality.  While moving through these frames, a disclaimer subtly flashes across the screen,[12]  urging users to be careful and remain aware of their surroundings.[13]  And while it promotes players to see Pokémon wherever they go, the app fails to show the full scope of where these creatures roam, and where users should not.  This is particularly interesting after the aforementioned settlement reached in August of this year.

Neither the video nor the Apple App Store description of includes any disclaimer or clause to encourage users against trespassing private property.  While the settlement is still fresh, it would behoove Pokémon Go to include such a disclaimer. And fast.  Clearly, Niantic, Inc. is not forcing users to enter onto personal property.  Those who download the app seem to use at their own initiative…and their own risk.  But there is something to be said about creating an app that entices strangers to trespass on private property in pursuit of a virtual creature.

As a child of the 90s, I understand the temptation to open an app on my smartphone and tramps around my neighborhood in search of Pikachu.  The temptation to become a Pokémon trainer for a short while.  However, inspiring individuals to intrude on private property brings up real public policy concerns.

Despite the settlement litigation, Pokémon Go seems to be increasing in popularity.  Just this month I’ve seen packs of individuals zig-zagging the streets in my neighborhood, trying to catch them all.  And while the settlement struck the company financially, it seems Niantic, Inc. will continue to push the seal as an augmented reality pioneer and millennials will continue to revel in nostalgia.  Public policy and privacy rights may be of substantial  social interest, but so it seems is reliving one’s childhood.

[1] See generally, Paul Tassi, ‘Pokémon GO’ Has Made $1.8 Billion As It Turns Two Years Old, Forbes (Jul. 9, 2018, 9:38 AM) https://www.forbes.com/sites/insertcoin/2018/07/09/pokemon-go-has-made-1-8-billion-as-it-turns-two-years-old/#283e74094655 (illustrating that the company racked in almost two billion dollars in revenue in its first two years).

[2] Hannah Albarazi, Pokémon Go Nuisance Deal Netz Pomerantz $4M In Atty Fees, Law360 (Aug. 22, 2019, 5:51 PM) https://www.law360.com/articles/1191631.

[3] See id.

[4] See Allison Grande, Pokémon Go Responsible for Individual Players’ Actions and Had Done Nothing Wrong, Law360 (Jan. 30, 2017, 7:57 PM) https://www.law360.com/articles/886257?copied=1.

[5] See id.; see also Allison Grande, ‘Pokémon Go’ Maker Encouraged Trespassing, Court Told, Law360 (Mar. 3, 2017, 8:06 PM) https://www.law360.com/articles/898098 (referencing the previous article and summarizing the case).

[6] Amazing Creatures Have Been Discovered Across the Planet!, YouTube (Feb. 1, 2018) https://www.youtube.com/watch?v=eMobkagZu64.

[7] Ash is the main character and trainer in the anime television series, Pokémon.  Ash Ketchum, Bulbapedia (last visited Sept. 12, 2019) https://bulbapedia.bulbagarden.net/wiki/Ash_Ketchum.

[8] About: A History of Viewing the World Differently, Niantic (last visited Sept. 12, 2019) https://nianticlabs.com/about/.

[9] Explained: What is Pokémon Go?, WebWise (last visited Sept. 12, 2019) https://www.webwise.ie/parents/pokemon-go/.

[10] Plaintiff’s Opposition to Defendant’s Motion to Dismiss, at 21–23, In Re Pokémon Go Nuisance Litigation (N.D. Cal. 2017) (No. 3:16-cv-04300-JD).

[11] Supra, note 5.

[12] Id.

[13] Pokémon Go Safety Tips, PokémonGo (last visited Sept. 12, 2019) https://www.pokemongo.com/en-us/.  The website itself provides a list of safety tips discussing the use of care while using the app.  While it mentions inaccessible places, it uses construction cites rather than private property as an example.  And nowhere does the term “trespass” appear.

By: Stephanie Seibert

Image source: https://www.bbc.com/news/technology-49670849

 

On September 11, 2019 California lawmakers passed employment legislation that would change “gig- companies” business models[1]. “Gig- companies” are businesses that offer a subset of jobs where entrepreneurs get work through an internet – based platform which matches them to customers seeking their service[2]. “Gig companies” include platforms such as Uber and Lyft[3].

Gig workers are not necessarily considered employees under federal and state employment law[4]. Since they are not classified as employees, they are classified as independent contractors[5]. Under the current labor standards, independent contractors do not qualify for protections such as The Fair Labor Standards Act or Americans with Disabilities Act[6]. Independent contractors also are not guaranteed other rights offered to employees, such as minimum wage, overtime pay, disability insurance, medical insurance, among much more[7].

The legislation passed in the California State Assembly intends to force gig-companies to reclassify independent contractors as employees. This legislation will require companies such as Uber and Lyft to completely restructure their business model[8].

The new legislation applies a strict “ABC test” to determine workers’ employment status:

(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work

(B) that the worker performs work that is outside the usual course of the hiring entity’s business

(C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity[9]

In order for a worker to be considered an independent contractor, rather than an employee, the employer must prove that each element of the “ABC test” is satisfied[10].

Uber and Lyft are working together to try to exempt themselves from the bill, recognizing that this legislation could subdue their businesses[11]. Lyft said that if this legislation were to pass, drivers “may soon be required to drive specific shifts, stick to specific areas, and drive for only a single platform[12].” Uber is taking a more optimistic approach, arguing that the new legislation does not automatically reclassify drivers as employees[13]. Uber’s Chief Legal Officer stated, “[The legislation] does not provide drivers with benefits, nor does it give drivers the right to organize. In fact, the bill currently says nothing about ride-share drivers[14].” The ride-sharing platforms will argue that because workers can determine when they work, where they work and for how long, they are not under control or direction of their employers[15].

The ride-sharing companies are trying to propose alternative legislation in an effort to compromise. The proposed legislation would guarantee a minimum wage of $21/hr and allow for sectoral bargaining[16]. Sectoral collective bargaining allows workers in rideshare industry to band together in negotiations[17].  This is unlikely to persuade California legislation to change the already introduced legislation[18].

A large consequence of this legislation is that the riders that use the ride-sharing platforms are going to be the ones who bear most of the expenses[19]. Analysts predict that ride-sharing platforms will increase their rates in an effort to offset the costs associated with making their drivers employees[20]. The raise in price could increases as much as 30% per ride[21].  The legislation is still in its early stages and will take a while to be enacted. Consumers and workers should not expect to see enactment of the legislation until sometime next year[22]. However, California Gov. Newsom made it clear that he is expecting to sign legislation if it makes it to his desk[23].

[1] Gabrielle Canon, California’s controversial labor bill has passed the Senate. Experts forecast more worker rights, higher prices for services, USA Today (Sept. 11, 2019, 12:37 AM), https://www.usatoday.com/story/news/politics/2019/09/10/what-californias-ab-5-means-apps-like-uber-lyft/2278936001/.

[2] Jaclyn Kurin, A Third Way for Applying U.S. Labor Laws to the Online Gig Economy: Using the Franchise Business Model to Regulate Gig Workers, 12 J. Bus. & Tech. L. 193 (2017).

[3] Id.

[4] Emily C. Atmore, Killing the Goose That Laid the Golden Egg: Outdated Employment Laws Are Destroying the Gig Economy, 102 Minn. L. Rev. 887 (2017)

[5] Id.

[6] See Canon, supra note 1.

[7] See Id; Canon, supra 2 at 888

[8] Canon, supra note 1.

[9] Id.

[10] Id.

[11] Alejandro Lazo & Sebastian Herrera, Uber Vows to Fight California Legislation on Gig Economy, Wall Street Journal (Sept. 11, 2019, 7:36 PM), https://www.wsj.com/articles/california-governor-still-in-talks-with-uber-lyft-over-gig-workers-law-11568212014.

[12] Id.

[13] See Id.

[14] Id.

[15] Dave Lee, Uber says ‘gig economy’ law will not hurt business, BBC (Sept. 11, 2019), https://www.bbc.com/news/technology-49670849.

[16] Id.

[17] Id.

[18] Id.

[19] See Lazo, supra note 11.

[20] Id.

[21] Id.

[22] Cannon, supra note 1.

[23] Lazo, supra note 11.

By: Jonathan H. Walter

https://thisweekinstartups.com/thisweekin-startups/ziprecruiter-logo/

Employment is a priority for the class of 2020 right now, and today more applicants than ever are look for jobs online. In 2015, the Pew Research Center found 79 percent of applicants used online resources in their most recent job search, and over one third said those online resources were the most important tool available to them.[1] This same report found more than half of U.S. adults looked for job information online and 45 percent applied online.[2] However, when segmenting for Americans under the age of 49, 75 percent of applicants looked for jobs online and 68 percent applied online.[3] This shows that the trend for younger Americans, and as such the future of job applications will be in the digital space.

 

 

While there is more known about issues of discrimination in employment advertising, little in known about internal recruiting tools or internal promotion tools utilized by companies. These internal recruiting algorithms make it more difficult to enforce current anti-discrimination laws within companies. Recently, Amazon shut down its internal recruitment AI after discovering it was discriminating against women.[11] These algorithmic systems, if not audited or corrected for bias, are susceptible to producing self-perpetuating and arbitrary bias, and, if left unfettered, these algorithms could filter out many qualified individuals belonging to these marginalized groups.[12]

 

Recent studies have found that over half of human resource managers said AI would be a regular part of their work within the next five years.[13] The use of algorithms in the tracking, ranking and matching of candidates to positions will not be going anywhere any time soon. As the hiring process becomes more digitized, a need for oversight of these platforms has become abundantly clear.

*University of Richmond Journal of Law and Technology is not endorsed by, directly affiliated with, maintained, authorized, or sponsored by ZipRecruiter.com. All product and company names are the registered trademarks of their original owners.

[1] Aaron Smith, Searching for Work in the Digital Era, Pew Research Center (2015) http://www.pewinternet.org/2015/11/19/searching-for-work-in-the-digital-era/.

[2] Id.

[3] Id.

[4] Examples of job websites that use these kinds of tools are ZipRecruiter, LinkedIn, Indeed, and Monster.com.

[5] Figuring out how exactly these algorithms work can be incredibly difficult as algorithms are protected by trade secret. See Taylor Moore, Trade Secrets & Algorithms as Barriers to Social Justice, Center for Democracy and Technology (2017) https://cdt.org/files/2017/08/2017-07-31-Trade-Secret-Algorithms-as-Barriers-to-Social-Justice.pdf.

[6] 23 Surprising Stats on Candidate Expereince – Infographic, Career Arc (2016) http://www.careerarc.com/blog/2016/06/candidate-experience-study-infographic/.

[7] See Department of Justice Statement of Interest, National Fair Housing Alliance et al., v. Facebook, Inc., Case 1:18-cv-02689-JGK (S.D.N.Y. 2018); Department of Justice Statement of Interest, Onuoha, et al., v. Facebook, 5:16-cv-06440 (N.D.C.A. 2018); Bradley et al., v. T-Mobile US, INC. et al., 5:17-cv-07232 (N.D.Cal. 2017); Jeffrey Dastin, Amazon Scraps AI Recruiting Tool That Showed Bias Against Women, Reuters (Oct. 9, 2018) https://www.reuters.com/article/us-amazon-com-jobs-automation-insight/amazon-scraps-secret-ai-recruiting-tool-that-showed-bias-against-women-idUSKCN1MK08G/; Julia Angwin and Terry Parris Jr., Facebook Lets Advertisers Exclude Users By Race, ProPublica (Oct. 28, 2016) https://www.propublica.org/article/facebook-lets-advertisers-exclude-users-by-race; Julia Angwin et al., Facebook (Still) Letting Housing Advertisers Exclude Users by Race, ProPublica (Nov. 21, 2017) https://www.propublica.org/article/facebook-advertising-discrimination-housing-race-sex-national-origin.

[8] See ACLU et al. Charge of Discrimination Against Facebook, https://www.aclu.org/sites/default/files/field_document/facebook_bill.pdf (citation omitted).

[9] AJ Wilcox, LinkedIn’s new Matched Audiences feature just blew Facebook Custom Audiences out of the water for B2B, Marketing Land (Apr. 24, 2017) https://marketingland.com/linkedins-new-matched-audiences-feature-just-blew-facebook-custom-audiences-water-b2b-212213; Matched Audiences, LinkedIn https://business.linkedin.com/marketing-solutions/ad-targeting/matched-audiences; About similar audiences on the Display Network, Google Ads Help https://support.google.com/google-ads/answer/2676774?hl=en.

[10] Jeff Kauflin, 12 Websites To Jump-Start Your Career In 2018, Forbes (Oct. 19, 2017) https://www.forbes.com/sites/jeffkauflin/2017/10/19/12-websites-to-jump-start-your-career-in-2018/#46b95fa919d8.

[11] Jeffrey Dastin, Amazon Scraps AI Recruiting Tool That Showed Bias Against Women, Reuters (Oct. 9, 2018) https://www.reuters.com/article/us-amazon-com-jobs-automation-insight/amazon-scraps-secret-ai-recruiting-tool-that-showed-bias-against-women-idUSKCN1MK08G/.

[12] Supra note 29 at 89; see also Solon Barocas and Anderw Selbst, Losing Out on Employment Because of Big Data Mining, New York Times (August 6, 2014) https://www.nytimes.com/roomfordebate/2014/08/06/is-big-data-spreading-inequality/losing-out-on-employment-because-of-big-data-mining.

[13] Supra note 42.

By: Dylan Phillips

Image Source: http://pixelvulture.com/2019/07/stolen-phone/

 

In modern times, cell phones have moved from being mere communication devices to integral parts of our lives.[1] We use them for everything from buying Starbucks to creating memes with pictures we have taken. With each usage of a phone, there is a vast amount of valuable data being stored on the device itself and in the cloud.[2] News stories have recently focused a significant amount of time on the value of this data when it is stolen,[3] but an aspect that has had little, if any prior consideration, is whether an individual retains a property interest or right to the data he or she produces on a device after he or she steals a digital device. Thus, the question presented is whether an individual who steals and adds data to a phone, has the right to avoid the data added to the phone from being searched by law enforcement without a warrant.[4]

 

Generally, a warrantless search of a cell phone is not a permissible act by law enforcement.[5] The United States Supreme Court has held that “Our answer to the question of what police must do before searching a cell phone seized incident to an arrest is accordingly simple—get a warrant.”[6] However, the question may not be so simple in all circumstances.[7] As of now, the Court has not definitively established whether there is an exception to this rule for data added to stolen property. Should a situation, such as a challenge to one’s constitutional right to not have a phone’s data searched without a warrant,[8] come before the Court, it is most likely that the Court will find that one does not have standing to establish prejudice of a search, when the evidence gathered as a consequence of a search and seizure is directed at someone else and he or she cannot prove that the invasion is of his or her own privacy through his or her property.

 

When considering the constitutionality of a search, “reasonableness is always the touchstone of Fourth Amendment analysis.”[9] In the absence of a warrant, a search is reasonable only if it falls within a specific exception to the warrant requirement.[10] The Court has held that the search incident to arrest exception does not apply to cell phones to avoid the warrant requirement.[11] However, the Court has also held that the continued availability of the exigent circumstances exception may give law enforcement a justification for a warrantless search in particular cases.[12] Regardless of whether exigent circumstances apply to this matter, the Court has declined standing to petitioners by holding that “Fourth Amendment rights are personal rights, which, like some other constitutional rights, may not be vicariously asserted.”[13] “A general rule has developed, stating that a person’s interest in his or her possession of stolen property is not a legitimate expectation of privacy society is willing to recognize as reasonable.”[14]

 

For example, the Court found that Petitioners had no legitimate expectation of privacy in areas of a car in which they claimed no property or possessory interest.[15] Moreover, in Hicks v. State, the court found no reasonable expectation of privacy concerns when the police looked at the contents of a stolen laptop in the defendant’s possession.[16] Additionally, a thief may not claim that the property is now abandoned by the actual owner of the phone because of the requirement of voluntary relinquishment; a bad act preceding the relinquishment, like theft or police misconduct, can render the abandonment involuntary.[17]

 

Here, however, the question is not whether there is an exception of privacy regarding the device’s data in general, but rather of the data added to the device after the theft. Should the Court ever directly address the issue of who maintains property rights to the data added by a thief to a stolen phone, the Court would most likely find that the public policy goals of discouraging theft and hacking far outweigh the idea of providing a transgressor a benefit for his or her bad act. However, because the Court has found that these transgressors lack standing to challenge such a search, the Court has yet to rule whether one’s potential property rights have been infringed upon, after a warrantless search when cellular phones are used by a thief. Thus, because no one has yet been ruled to have standing to challenge the warrantless search of stolen property, the question of whether a thief of a phone still has the right to privacy in the data the thief inputted in the phone remains unanswered by the Court.

 

[1] See generally Riley v. California, 573 U.S. 373, 385 (2014) (“[M]odern cell phones . . . are now such a pervasive and insistent part of daily life that the proverbial visitor from Mars might conclude they were an important feature of human anatomy”).

[2] See generally Future Mobile Data Usage and Traffic Growth, Ericsson, https://www.ericsson.com/en/mobility-report/future-mobile-data-usage-and-traffic-growth (last visited Sept. 5, 2019) (displaying current and predicted future data usage).

 

[3]See, e.g., Robert McMillan, How the Accused Capital One Hacker Stole Reams of Data From the Cloud, Wall St. J. (Aug. 4, 2019),https://www.wsj.com/articles/how-the-accused-capital-one-hacker-stole-reams-of-data-from-the-cloud-11564911001; Rachel Siegel, Florida City Will Pay Hackers $600,000 to Get Its Computer Systems Back, Wash. Post (June 20, 2019), https://www.washingtonpost.com/business/2019/06/20/florida-city-will-pay-hackers-get-its-computer-systems-back/.

 

[4] The right referred to in this post is the right granted by the Fourth Amendment. See U.S. Const. amend. IV (“The right of the people to be secure in their persons, . . . and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, . . . and particularly describing the place to be searched, and the persons or things to be seized”).

 

[5] See Riley, 573 U.S. at 376 (noting that the danger of destruction of evidence through remote wiping or hurting an officer are not concerns sufficient to surpass the warrantless search rule and so cell phones cannot be constitutionally searched without a warrant); see also id. at 382 (stating “warrantless searches incident to arrest occur with far greater frequency than searches conducted pursuant to a warrant) (citing 3 W. LaFave, Search and Seizure §5.2(b), p. 132, and n. 15 (5th ed. 2012)).

 

[6] Riley, 573 U.S. at 403.

[7] See generally Timbs v. Indiana, 139 S. Ct. 682, 690-91 (2019) (stating, “without separately considering incorporation, that States’ warrantless search of digital information stored on cell phones ordinarily violates the Fourth Amendment”) (citing Riley, 573 U.S. 373). By mentioning the word “ordinarily,” it is implied that there are exceptions to this rule, just as with all legal rules, thus, the rule may not be so “simple.”

[8] U.S. Const. amend. IV.

[9] Birchfield v. North Dakota, 136 S. Ct. 2160, 2186 (2016); Brigham City v. Stuart, 547 U.S. 398, 403 (2006).

[10] See Kentucky v. King, 563 U.S. 452, 459-460 (2011).

[11] See Riley, 573 U.S. at 376.

[12] See id.

[13] Rakas v. Illinois, 439 U.S. 128, 133-34 (1978) (citations omitted).

A person who is aggrieved by an illegal search and seizure only through the introduction of damaging evidence secured by a search of a third person’s premises or property has not had any of his Fourth Amendment rights infringed. And since the exclusionary rule is an attempt to effectuate the guarantees of the Fourth Amendment, it is proper to permit only defendants whose Fourth Amendment rights have been violated to benefit from the rule’s protections. There is no reason to think that a party whose rights have been infringed will not, if evidence is used against him, have ample motivation to move to suppress it.

 

See also Brown v. United States, 411 U.S. 223, 230 (1973); Simmons v. United States, 390 U.S. 377, 389 (1968); Wong Sun v. United States, 371 U.S. 471, 492 (1963); cf. Silverman v. United States, 365 U.S. 505, 511 (1961); Gouled v. United States, 255 U.S. 298, 304 (1921).

 

[14] Shaver v. Commonwealth, 30 Va. App. 789, 798 (1999); see Brown, 411 U.S. at 230 n.4; see also United States v. Hensel, 672 F.2d 578 (6th Cir. 1982); United States v. Hargrove, 647 F.2d 411 (4th Cir. 1981); Smith v. Garrett, 586 F. Supp. 517 (N.D.W.Va. 1984); McMillian v. State, 65 Md. App. 21 (Md. App. 1985); People v. Mercado, 114 A.D.2d 377 (N.Y.S.2d 1985); Sanborn v. State, 251 Ga. 169 (Ga. 1983); State v. Hamm, 348 A.2d 268 (Me. 1975)).

 

[15] See Rakas, 439 U.S. at 128.

 

[16] See Hicks v. State, 929 So. 2d 13, 14 (2006); see generally Shaver, 30 Va. App. at 799 (1999) (providing examples of a lack of standing to argue privileges under the Fourth Amendment); see e.g., United States v. McCambridge, 551 F.2d 865, 870 n.2 (1st Cir. 1977) (finding that a defendant had no standing to challenge the search of a stolen suitcase because he did not have an ownership interest or other rights to it); Josephs v. Commonwealth, 10 Va. App. 87, 98 (1990) (en banc) (finding that a passenger in a stolen vehicle had no expectation of privacy in that vehicle); Commonwealth v. Strickland, 707 A.2d 531, 534 (Pa. Super. 1998) (finding the search of the vehicle that the defendant was driving was permissible because the defendant could not establish a legally cognizable expectation of privacy in that which was stolen); State v. Hamm, 348 A.2d 268, 273 (stating that society is unwilling to recognize as reasonable a thief’s expectation of privacy in stolen property); Graham v. State, 47 Md. App. 287, 295 (Md. App. 1980) (holding that the court will not recognize a thief’s expectation of privacy in a stolen backpack and moped)).

 

[17] See State v. Dixon, No. 13-09-00445-CR, 2010 WL 3419231, at *18-19 (Tex. App. Aug. 27, 2010) (holding that a cell phone could not be abandoned because the phone was stolen and the owner accordingly did not intentionally relinquish ownership of the device even though he did not try to reclaim his phone for weeks after the theft). But see, People v. Schutter, 249 P.3d 1123, 1126 (Colo. 2011) (en banc) (holding that an iPhone accidentally locked in a public restroom that the defendant could not retrieve without a store employee was not abandoned, and, therefore, “[a]ssuming, without deciding, that the Fourth Amendment could tolerate, under some set of circumstances, some kind of warrantless examination of a cell phone to ascertain how it might be returned to its owner, this case cannot present that set of circumstances”).