Richmond Journal of Law and Technology

By: Kathleen Hugo,

In today’s world, people frequently conduct financial transactions through mobile payments. A person can pay her roommate for utilities, split the dinner bill, or chip in for a round of drinks all with the click of a button. A popular platform to conduct such transactions is the peer-to-peer payment service mobile app called Venmo, which acts as a “digital wallet.”[1] While Venmo is known for its user-friendly interface, many users overlook the possibility of potential fraud and the limited legal actions they can take in that event.

Background on Venmo:

Venmo was created in 2009 when one of the cofounders, Iqram Magdon-Ismail, forgot his wallet on a trip to Philadelphia to visit friends.[2] When Magdon-Ismail owed Andrew Kortina two hundred dollars, the two agreed that the situation would be easier solved through a mobile payment system rather than traditional cash or checks.[3] In 2012, Magdon-Ismail and Kortina’s startup, “Venmo,” was purchased by Braintree, which operates the payment systems for companies such as Dropbox, Airbnb, StubHub, and Uber.[4] The following year, Ebay’s PayPal acquired Braintree, making Venmo a subsidiary of PayPal.[5]

How Venmo Works:

To use Venmo, a consumer simply links a credit card, debit card, or checking account to the mobile app, and can immediately send or receive payments from friends in their network.[6] The payments are then retained in a “Venmo Balance” account, which can be used for future transactions or cashed out and deposited into the consumer’s bank account.[7]

The Problem:

Many users incorrectly assume that when sending a payment, Venmo immediately transfers the funds from Consumer A to Consumer B.[8] In reality, Venmo floats the money to Consumer B until the funds have cleared from Consumer A’s bank account.[9] This common misunderstanding of Venmo’s technology is being utilized by scammers to commit fraudulent transactions, with little to no protection for the consumer on the other end.[10] One type of Venmo fraud occurs when Consumer A uses a fraudulent credit card to pay Consumer B.[11] The money immediately appears in Consumer B’s Venmo balance, but when he or she attempts to cash out, the transaction has been reversed for failure to clear Consumer A’s bank account.[12] Another common scam occurs when strangers A and B conduct a transaction via Craigslist.[13] Consumer A, the buyer, deliberately cancels the transaction before Consumer B, the seller, has had time to transfer the money into his or her bank account.[14] In this case, the seller may have already sent the goods to the buyer, but the buyer has now evaded payment, and the seller has no opportunity to recover.[15] For this reason, Venmo does not condone stranger-to-stranger transactions on Craigslist and event sites, instead encouraging users to only engage in “payments between friends and people who trust each other.”[16]

Venmo has limited options for users who fall victim to fraudulent transactions, especially when the consumer is in violation of the User Agreement. Venmo’s user agreement clearly prohibits personal accounts from “receiv[ing] business, commercial, or merchant transactions.”[17] So if Consumer A purchased concert tickets from Consumer B on Craigslist, this could be considered a “merchant transaction” on a personal account, therefore breaching the User Agreement.[18] Venmo does offer the option to create a business account, but this requires “an application and explicit authorization.”[19]

Section (i) of the user agreement, entitled “no buyer or purchase protection,” says just that. In the event of any “unsatisfactory” transactions, the customer will have no option for remedy from Venmo.[20] The only available recourse for consumers is described in section (D)(11), which describes the consumer’s options in case of an “unauthorized transaction,” or an “error that occurs when money is sent from your account that you did not authorize and did not benefit you.”[21] Aside from this limited circumstance, Venmo’s terms and conditions are clear on the fact that “Venmo does not offer buyer or seller protection,” so use at your own risk.[22]

Venmo is a free service designed for convenience, but with that benefit comes the potential burdens of conducting transactions. While Venmo is a widely accessible and easy-to-use option for mobile payments, each consumer must understand its limits in order to protect his or her money.

 

[1] See Venmo, http://www.venmo.com.

[2] See Felix Gillette, Cash is for Losers!, Bloomberg (Nov. 21, 2014, 6:32 AM), http://www.bloomberg.com/news/articles/2014-11-20/mobile-payment-startup-venmo-is-killing-cash; See also Carolyn Lowry, Note: What’s In Your Mobile Wallet? An Analysis of Trends in Mobile Payments and Regulation, 68 Fed. Comm. L.J. 353 (2016).

[3] See Gillette, supra note 2.

[4] Trevir Nath, How Safe is Venmo and Why is it Free?, Investopedia (Mar. 24, 2015, 6:50 PM), http://www.investopedia.com/articles/personal-finance/032415/how-safe-venmo-and-why-it-free.asp; see generally Braintree, https://www.braintreepayments.com (last visited Oct. 3, 2016).

[5] See Gillette, supra note 2. See also Alison Griswold, Venmo Scammers Know Something You Don’t, Slate (Sept. 15, 2015, 9:32 PM), http://www.slate.com/articles/business/moneybox/2015/09/venmo_scam_and_fraud_why_it_s_easy_to_get_ripped_off_through_the_mobile.html.

[6] See Nath, supra note 4.

[7] Id.

[8] See Griswold, supra note 5 (“Contrary to many users’ assumptions, sending money on Venmo does not instantaneously transmit funds from Person A to Person B.”).

[9] See id.

[10] See id.

[11] See Justin Pritchard, Venmo Scams: Can You Get Ripped off on Venmo?, The Balance (July 5, 2016), https://www.thebalance.com/venmo-scams-315823 (“[T]he person might use a stolen, credit card number to fund the payment . . .”).

[12] See Griswold, supra note 5 (“He handed off the devices once he got Venmo’s payment notifications, then later attempted to withdraw funds into his bank account. They never showed up.”).

[13] See id.

[14] See Ethan Wolff-Mann, The Scary Thing You Don’t Understand About Venmo, Time (Sept. 21, 2015), http://time.com/money/4036511/venmo-more-check-than-cash/.

[15] See id.

[16] See Venmo, https://www.venmo.com/about/security (“Avoid payments to people you don’t know, especially if it involves a sale for goods and services (like event tickets and Craigslist items).”).

[17] See User Agreement § B, Venmo, https://venmo.com/legal/us-user-agreement (valid as of Sept. 13, 2016).

[18] Id. at § I.

[19] See Venmo, https://venmo.com/about/security.

[20] See User Agreement § I, Venmo, https://venmo.com/legal/us-user-agreement (valid as of Sept. 13, 2016) (“Company does not currently offer a buyer or purchase protection program in connection with App Payments or any other payments made using a Venmo account. This means that should your purchase turn out to be unsatisfactory for any reason, you will not have recourse with Company, and instead should contact the App provider directly.”).

[21] See id. at § (D)(11).

[22] See Venmo, https://venmo.com/about/security.

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By: Kaley Duncan,

Cyber-security is a growing concern worldwide.[1] Continued increase in information sharing via the internet has left this information susceptible to hacker exploitation.[2] The motive for many cyber-attacks is to sell information gained to sites that use that information for identity theft. [3] If you are like me, your passwords are not only less than creative, but are also likely used for multiple accounts. As such, if your security information has been compromised, the effects can be far-reaching; it could affect not only information from your recent email correspondences, but possibly more important information, such as your bank account number and social security number.[4] Big companies, and even the government, have been looking for ways to combat these hacks.[5] So far in 2016, nineteen companies including Target, Walmart, Snapchat, and the IRS have been targeted by hacking schemes. [6] Recently, another prominent name has been added to the list.

On Thursday, September 22^nd, the email platform Yahoo confirmed that 500 million of its user accounts had been hacked.[7] This is the largest security breach on record.[8] Stolen information included emails, passwords, birth dates, telephone numbers, and, in some cases, even security questions.[9] To make matters worse, Yahoo informed the public that these hacks started in 2012 and were just recently discovered by the company’s security team.[10]

Multiple lawsuits have been filed including a class action alleging gross negligence.[11] The suit, filed by New York resident Ronald Shwartz, contends Yahoo’s security team knew of the breach long before they disclosed it to the public.[12] Thus far, it is unclear when exactly Yahoo personnel were made aware of the 2012 security breach, but many sources state the company was alerted to the security issues in the Summer of 2016.[13] Yahoo claims to have conducted security sweeps since 2012, including one on September 9th, 2016, that led it to believe there was no reason for concern.[14]

Yahoo CEO Marissa Mayor, has released little information regarding the controversy. However, from what little she has commented, the company seems to believe this was a state-sponsored hack.[15] A state-sponsored hack is a cyber-security attack conducted by a foreign government.[16] “Yahoo has been stingy with the facts, but that may be at the request of U.S. law enforcement or the intelligence community,” said Leo Taddeo, a former special agent in charge of the FBI’s New York cyber-crime office, in an interview with The Washington Post.[17] “If, in fact there are signs of a state actor, the authorities would definitely prefer to keep the details out of public domain. Otherwise, the hackers may get tipped off to the U.S. government’s sources and capabilities.”[18]

Others wonder if the new merger with Verizon had something to do with Yahoo’s reluctance to release information on the breaches to the public. Verizon is currently on track to acquire Yahoo for $4.8 billion, a figure that may be affected by the hack.[19] In fact, a study done by Ponemon Institute found that the average cost to remediate data per user is approximately $158.[20] According to those statistics, upwards of $70 billion would be required to mitigate the cost of this size cyber-security breach. Not surprisingly, this will likely affect the company’s worth.[21]

Senator Mark Warner, a Democrat from Virginia and cofounder of the Senate Cyber-Security Caucus, is suspicious of Yahoo’s failure to disclose information that is of such “vital importance” “to keep the public and investors informed” and voiced his concerns in a letter to the U.S. Securities and Exchange Commission.[22] Currently there is no federal law requiring the prompt disclosure of security breaches of this nature.[23] “[The] seriousness of this breach at Yahoo is huge,” said Warner in a statement made Thursday afternoon.[24] Recent security breaches, namely those affecting Target and Yahoo, have compelled Warner to promote legislation protecting consumers.[25] In fact, Warner is “working on bipartisan legislation to create a comprehensive, nationwide, and uniform data breach standard requiring timely consumer notification for breaches of financial data and other sensitive information.” [26] Most states have already enacted statutes requiring disclosure to consumers.[27]

For example, pursuant to Virginia Code §18.2-186.6(B):

If unencrypted or unredacted personal information was or is reasonably believed to have been accessed and acquired by an unauthorized person and causes, or the individual or entity reasonably believes has caused or will cause, identity theft or another fraud to any resident of the Commonwealth, an individual or entity that owns or licenses computerized data that includes personal information shall disclose any breach of the security of the system following discovery or notification of the breach of the security of the system to the Office of the Attorney General and any affected resident of the Commonwealth without unreasonable delay.[28]

While the phrase “without unreasonable delay” is largely left up to interpretation, according to the Ponemon Institute report, the average amount of time required to discover a malicious security breach is roughly 229 days. [29] If Yahoo personnel have been forthcoming with their investigation, it took them nearly two years to discover this major security breach, three times the suggested average. [30] One cannot help but speculate, was this really a reasonable delay in disclosure or a calculated cover-up? As new facts emerge the motive may be revealed, but until then the public is left with concerns about Yahoo’s transparency.

 

[1] See generally Phenom Institute, 2016 Cost of Data Breach Study: Global Analysis, at 1 (2016), http://www-01.ibm.com/common/ssi/cgi-bin/ssialias?htmlfid=SEL03094WWEN (analyzing statistics of cyber data breaches worldwide).

[2] See Ali Hedayati, An Analysis of Identity Theft: Motives, Related Frauds, Techniques, and Prevention, 4 J. of L. & Conflict Resol. 1, 2–3 (2012), http://www.academicjournals.org/article/article1379859409_Hedayati.pdf

[3] See id at 10.

[4] See id at 4.

[5] See Riley Walters, Cyber Attacks on U.S. Companies Since November 2014, Heritage.org, http://www.heritage.org/research/reports/2015/11/cyber-attacks-on-us-companies-since-november-2014 (last visited October 3, 2016).

[6] See Judy Leary, The Biggest Data Breaches in 2016, So Far, Identity Force Blog, https://www.identityforce.com/blog/2016-data-breaches

[7] See Kif Leswing, Yahoo Confirms Major Breach – and it Could be the Largest Hack of All Time, Business Insider (Sept. 22, 2016), http://www.businessinsider.com/yahoo-hack-by-state-sponsored-actor-biggest-of-all-time-2016-9

[8] http://www.mercurynews.com/2016/09/23/yahoo-hit-with-class-action-lawsuit-over-massive-data-breach/

[9] See Nicole Perlroth, Yahoo Says Hackers Stole Data on 500 Million Users in 2014, N.Y. Times (Sept. 22, 2016), http://www.nytimes.com/2016/09/23/technology/yahoo-hackers.html?_r=0

[10] See id.

[11] See Reuters, Yahoo is Sued for Gross Negligence Over Huge Hacking, Fortune (Sept. 23, 2016), http://fortune.com/2016/09/23/yahoo-is-sued-for-gross-negligence-over-huge-hacking/

[12] See id.

[13] See Hayley Tsukayama, Data Breach: What Yahoo Knew When Could Cause it Trouble, Union-Bulletin.com, http://www.union-bulletin.com/news/business/data-breach-what-yahoo-knew-when-could-cause-it-trouble/article_0e099de4-880a-11e6-ba24-cff074054d7e.html (last visited October 3, 2016).

[14] See Paul Szoldra, Yahoo Won’t Answer the Most Important Question About its Massive Hack, Business Insider (Sept. 28, 2016), http://www.businessinsider.com/yahoo-massive-hack-2016-9

[15] See Account Security Issue FAQs, Yahoo.com, https://help.yahoo.com/kb/account/SLN27925.html?impressions=true (last visited October 1, 2016).

[16] See Timour Rashed, State Sponsored Hacking and Cyber Security Policy, Tim Tech Support Blog (Apr. 18, 2012), http://timourrashed.com/state-sponsored-hacking-and-cyber-security-policy/

[17] See Hayley Tsukayama, Could Yahoo be in Trouble with the SEC?, The Washington Post (Sept. 28, 2016), https://www.washingtonpost.com/news/the-switch/wp/2016/09/28/could-yahoo-be-in-trouble-with-the-sec/

[18] Id.

[19] See Perlroth, supra note 9.

[20] See Phenom Institute Report, supra note 1 at 1.

[21] See Leswing, supra note 7.

[22] See Senator Warner Calls on SEC to Investigate Disclosure of Yahoo Breach, Mark R. Warner Blog (Sept. 26, 2016, 12:15 PM), http://www.warner.senate.gov/public/index.cfm/bloghome; See also Letter from Mark R. Warner, U.S. Senator, to The Honorable Mary Jo White, U.S. SEC Chair (Sept. 26, 2016) (https://www.scribd.com/document/325367178/20160926-Letter-to-SEC-on-Yahoo-Breach).

[23] See Perlroth, supra note 9.

[24] See Mark R. Warner Blog, supra note 22.

[25] See id.

[26] Id.

[27] Nat’l Conf. of State Legislatures: Security Breach Notification Laws, (Jan. 4, 2016), http://www.ncsl.org/research/telecommunications-and-information-technology/security-breach-notification-laws.aspx

[28] Va. Code Ann. § 18.2-186.6 (2016).

[29] See Ponemon Institute Report, supra note 1 at 3.

[30] See Perlroth supra note 9.

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By: Hannah Newman,

As an industry, healthcare is quickly changing. When considering the latest technology in the realm of healthcare, many might point to the advances in surgical techniques or the creation of artificial organs. In reality, some of the technological transformations that affect the greater public go much more unnoticed. Electronic health information systems have created a drastic revolution in the way health records are collected, maintained, and disseminated.[1] An electronic health record (EHR) is a “collection of electronic health information about individual patients and populations.” [2] These systems integrate health care information that is currently collected and maintained in multiple different mediums such as paper, electronic record, and film.[3] The purpose of this integration of records is to improve quality of care.

The U.S. health care system has always been fragmented, consisting of multiple providers and separate systems of record keeping.[4] As health care operation costs have skyrocketed and payment methods have shifted, the U.S. health system has responded with organizational consolidation and managed care.[5] In order to facilitate this consolidation, increase efficiency in delivery of care, and decrease costs, health systems have turned to the broad adoption of electronic medical record (EMR) systems.[6]

The Health Information Technology for Economic and Clinical Health (HITECH) Act of 2009 created a shift in the use of health records by providing financial incentives to promote “meaningful use” of electronic health records by medical providers.[7] According to the Centers for Disease Control and Prevention, the percentage of physicians who adopted the basic electronic medical records increased from 17-34 percent from 2008 to 2011.[8]

Health information systems operate to deliver a seamless continuity of care to patients. These electronic systems help integrate primary care, specialists, hospitals, laboratories, pharmacies, and physical therapy.[9] These systems “facilitate electronic access to clinical information such as demographic characteristics, patient encounters, and laboratory and imaging results, with some systems permitting clinicians’ notes.” [10] While sophisticated systems show promise to improve patient safety and coordination of care, initial stages of implementation can produce the opposite results.[11]

During the period known as the “implementation chasm,” where providers move from one familiar system to a new one, they should be aware of three main areas of medical malpractice liability.[12]

Liability in medical treatment: Greater access to a patient’s medical histories and treatments comes with greater risk of liability.[13] Providers “are responsible for medical information they can access—and there is increased access to e-health data from outside the practice that can be accessed” from the patient’s EHR.[14] Failure to fully review a patient’s medication list, lab results, or radiology reports can greatly alter a course of treatment and can cause serious injury to a patient.[15] If the doctor has access to a patient’s essential health information, but does not review it, he or she could be liable.[16]

Human Error: Like any complex software program, these electronic record systems require practice to successfully operate. Mistakes can result from insufficient education and training, or simple human error.[17] Providers might document the wrong information into the system, incorrectly copy and paste from old visit notes, or order the wrong test.[18] Effective training of the new system, used in conjunction with the existing technology, can help to minimize these errors.[19] Even beyond human error, these software systems can malfunction or crash, potentially causing provider liability as well.[20]

Availability of Records: EMR systems are meant to collect and consolidate a patient’s records for improvement of quality and continuity of care. However, in the event of a medical malpractice suit, providers must often produce any and all patient records as either defense or proof of the claim.[21] EMRs include a more detailed record than what is generally required in a traditional paper record, which can either help or hurt the provider.[22] There is still great debate over what constitutes the “legal medical record,” which should be provided upon patient request.[23] “Under federal law, EMR metadata –which consists of all electronic transactions such as time stamps of clinical activity and the input of orders—is discoverable in civil trials.”[24] Other, more specific, medical malpractice laws tend to vary on a state-by-state basis. [25]

Electronic health record systems are truly transforming the way healthcare serves patients each and every day. They provide for the circulation of information, continuity of care, and convenience for patients and providers. However, broad and effective adoption of these complex systems is still several years away. Until that time, providers face a higher risk of medical malpractice liability.

 

[1] See Richard Hillestad et. al., Can Electronic Medical Record Systems Transform Health Care? Potential Health Benefits, Savings, and Costs, HealthAffairs, Sept. 2005, 1103, 1103, http://content.healthaffairs.org/content/24/5/1103.full.pdf+html.

[2] Tracy D. Gunter, Nicholas P. Terry, The Emergence of National Electronic Health Record Architectures in the United States and Australia: Models, Costs, and Questions, JMIR Publications, 2005, https://www.jmir.org/2005/1/e3/?xml.

[3] Id.

[4] See James C. Robinson & Lawrence P. Casalino, Vertical Integration and Organizational Networks in Healthcare, HealthAffairs, 1996, 7, 8, http://content.healthaffairs.org/content/15/1/7.full.pdf+html.

[5] Id. at 9.

[6] See supra note 1.

[7] See Sandeep S. Mangalmurti et. al., Medical Malpractice Liability in the Age of Health Records, New Eng. J. Med., 2060, 2060 (Nov. 18, 2010) http://www.nejm.org/doi/pdf/10.1056/NEJMhle1005210.

[8] See Molly Gamble, 5 Legal Issues Surrounding Electronic Medical Records, Becker’s Hospital Review (Jan. 19, 2012) http://www.beckershospitalreview.com/legal-regulatory-issues/5-legal-issues-surrounding-electronic-medical-records.html.

[9] See supra note 2.

[10] Id.

[11] Id.

[12] See supra note 7 at 2061.

[13] See David B. Troxel, Electronic Health Record Malpractice Risks, The Doctors Company, (Sept. 2016) http://www.thedoctors.com/KnowledgeCenter/PatientSafety/articles/Electronic-Health-Record-Malpractice-Risks.

[14] Id.

[15] See id.

[16] See id.

[17] See Deirdre Fulton, EHR Mess-Ups Put Doctors at Risk for Malpractice Lawsuits, HIMSS16 Speaker Says, HealthCare IT News, (Jan. 26, 2016, 9:57 AM), http://www.healthcareitnews.com/news/ehr-mess-ups-put-doctors-risk-malpractice-lawsuits-himss16-speaker-says.

[18] See supra note 7 at 2061.

[19] See id.

[20] See id.

[21] See supra note 8.

[22] See id.

[23] See id.

[24] Id.

[25] See id.

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By: Lindsey McLeod,

Supposed threats to cyber security once seemed to be nothing more than rhetoric meant to frighten American constituents. Recently, however, these threats have proven to be legitimate, as cyber security has impacted the American political arena.[1] As the American people heard from presidential candidates Donald Trump and Hillary Clinton in the first presidential debate, the cyber-security threat from both domestic and foreign hackers is a very real danger to American national security.[2] The reality of the cyber-security threat from domestic and foreign entities has had an especially strong effect on these candidates. The very votes we cast for them may be vulnerable to such breaches.[3]

As electronic voting methods become the norm in dozens of districts across the country, the effort to protect the security and validity of ballots introduces a noticeably different challenge. A system that once presented us with issues such as the “hanging chad” that tarnished the image of the 2000 Presidential election is now primed for an entirely different ballot security problem.[4]

With Election Day nearly a month away, awareness and uncertainty surrounding potential cyber-security threats in the United States is growing. In fact, hacks have already been reported in both Illinois and Arizona. [5] Though election results in these states have not been impacted, the fact that the systems were hacked, coupled with the recent hack of the Democratic National Convention presents an unsettling narrative regarding electoral security here in the United States.[6] The hacks that have already occurred resulted in the release of voter identifiable information, including social security, address and name information.[7] Though officials concede that these electronic voting methods evidently do not adequately protect voter information, they contend that the systems do not risk the validity of election results because they are not connected to the Internet.[8] Specialists on both sides of the issue, however, disagree on whether the lack of Internet capability is protection enough.[9] Despite the fact that specialist agree that a hack affecting the results of an election is unlikely, the fear among American voters regarding the security and validity of our election process remains high.[10]

The question still remains whether an electronic ballot presents the same security that a paper ballot does, considering both the absence of a paper trail and the possibility of pre-programmed results.[11] As was evidenced 16 years ago in Bush v. Gore, the paper trail can become a valuable tool when challenging vote tabulation.[12] Should this year’s electoral process be challenged after the November 8 election, the different methods of voting would create a problem in that there would not be a uniform paper trail. Proponents of the paper ballot look to this as one of our largest security problems: how can we insure the validity of our votes if we cannot be sure that all votes can be tabulated manually in the event of a hack, or even in the event of a mere computer error?[13]

The issue of how to fix such a process brings to light some unique challenges that the structure of our electoral system pose. Proponents of uniform ballot initiatives claim that the current system “result[s] in a patchwork collection of federal, state and local laws: all separate and all unequal”.[14] The structure of the American electoral system also presents a unique challenge in terms of implementing a uniform voting method. In a country run on a system that promotes state-run elections, the reality is that a uniform federal system would likely bring a challenge on federalism grounds. The Help America Vote Act of 2002 attempted to move towards a more uniform approach to elections, in which federal funds were authorized for election administration and thus facilitating minimum standards for voting systems.[15] These required minimum standards, however, fall far from the requirements that proponents of new voter security measures are calling for.[16]

Should the United States fall victim to a hack affecting election outcomes, Congress could likely prescribe a uniform voting method for federal elections, but integrating a federal election standard in conjunction with state elections would present a problem. In Oregon v. Mitchell the court found that Congress had the right to impose an age related voting restriction in federal elections but that this restriction could not mandatorily extend to state elections.[17] This precedent would facilitate the implementation of uniform voting methods for federal elections, but the same could not be said for state elections.[18] Thus, if a state objected to a federally mandated uniform voting method, they could conduct the state elections on their own terms while simultaneously conducting the federal elections as prescribed. Further investigation into whether the federal government may call for the uniform voting method as a means of making our elections less vulnerable to cyber-security threats presents an interesting angle that proponents may consider in an attempt to distinguish Mitchell.

This November, American citizens and politicians alike will cast their vote and hope that the security and validity of that choice is protected by the security measures in place. It is possible that a debate regarding the security of the 2016 election may begin after the results are tallied, and this could prompt further discussion on fortifying the security of our electoral system.[19] Thank goodness that come January 20, 2017 we will have Donald Trump, who is uniquely adept at navigating foreign relations (or relationships) with arguably one of America’s largest cyber-security threats, or Hillary Clinton, who has had her cyber-security knowledge put to the test in her evaluation of the pros and cons of private email servers, at the helm to further guide us on this topic.[20]

 

[1] See generally Harriet Taylor, Fears of a hacked election may keep 1 out of every 5 voters home, says report, CNBC (Sept. 29, 2016) http://www.cnbc.com/2016/09/29/fears-of-a-hacked-elction-may-keep-1-out-of-every-5-voters-home-says-report.html (explaining the implications of a study determining that one in five registered U.S. voters may stay home on election day because of fears about cyber-security and vote tampering).

[2] See Eyragon Eidam, Presidential Debate 2016: Cybersecurity Highlights Significant Differences in Policy, Understanding Between Candidates, Government Technology (Sept. 27, 2016) http://www.govtech.com/security/Presidential-Debate-2016-Cybersecurity-Highlights-Significant-Differences-in-Policy-Understanding-Between-Candidates.html.

[3] See Wesley Bruer & Evan Perez, Officials: Hackers Breach Election Systems In Illinois, Arizona, CNN (Aug. 30, 2016) http://www.cnn.com/2016/08/29/politics/hackers-breach-illinois-arizona-election-systems (describing the amount of voter information compromised in Illinois and Arizona).

[4] Guy-Uriel E. Charles et al., Election Law Stories, 547-49 (Joshua A. Douglas & Eugene D. Mazo eds., 1st ed. 2016) (describing the 2000 Presidential Election in Florida in which “hanging chads”, a term used to describe a punch-hole vote that was not entirely punched through, were a contentious issue that played a large role in the the Bush v. Gore litigation and ultimately the 2000 Presidential Election results).

[5] See supra note 3.

[6] See Id. (“Investigators believe the hackers are likely based overseas, according to a law enforcement official”).

[7] Id.

[8] See Richard Clark, Yes, It’s Possible To Hack The Election, ABC News (Aug. 19, 2016), http://abcnews.go.com/Politics/hack-election/story?id=41489017 (“if sophisticated hackers want to get into any computer or electronic device, even one that is not connected to the internet, they can do so”).

[9] See Id (explaining that a hacker would not necessarily need an internet connection to hack an election device).

[10] See John F. Banzhaf III, Warning – This Presidential Election Could Be Hacked, Perhaps By A Foreign Power, Breitbart (Aug. 23, 2016) http://www.breitbart.com/2016-presidential-race/2016/08/23/warning-presidential-election-hacked-perhaps-foreign-power/.

[11] See supra note 7.

[12] See supra note 4.

[13] See Craig Timberg & Andrea Peterson, Here’s How Russian Hackers Could Actually Tip An American Election, Washington Post (Aug. 30, 2016) https://www.washingtonpost.com/news/the-switch/wp/2016/08/30/could-hackers-tip-an-american-election-you-bet/ (describing how the most vulnerable voting methods are those without paper records of the electronic tabulation of votes).

[14] Uniform Election Standards and Real Accountability, FairVote.org (Last visited: Oct. 1, 2016) http://archive.fairvote.org/?page=64.

[15] See Help America Vote Act, 107 Pub. L. No. 252 (creating the U.S. Election Assistance Commission and setting minimum standards for voting systems as well as requirements for adopting uniform standards on what constitutes a vote).

[16] See Id.

[17] See Oregon v. Mitchell 400 U.S. 112, 134 (holding that under Art I, § 2, the States have the power to set qualifications to vote in state and local elections, and the whole Constitution reserves that power to the States except as it has been curtailed by specific constitutional amendments).

[18] See Id.

[19] See Dara Lind, Donald Trump: “the only way we can lose…is if cheating goes on”, Vox.com (Aug. 13, 2016) http://www.vox.com/2016/8/2/12342600/trump-rigged-clinton-steal-election (describing the remarks made by Donald Trump the potential for rigged election results).

[20] See Jonathan Martin & Amy Chozic, Donald Trump’s Campaign Stands By Embrace of Putin, N.Y. Times (Sept. 8, 2016) http://www.nytimes.com/2016/09/09/us/politics/hillary-clinton-donald-trump-putin.html (describing that Trump is embracing his reputation for his appreciation for Vladimir Putin as a strong and effective leader); see also Garrett Graff, What the FBI Files Reveal About Hillary Clinton’s Email Server, Politico (Sept. 30, 2016) http://www.politico.com/magazine/story/2016/09/hillary-clinton-emails-2016-server-state-department-fbi-214307 (explaining the recently released emails that were sent on Hillary Clinton’s private email server).

Photo Source:

http://uwf.edu/media/cybersecurity/Cyber-Security-(2).jpg

By: Sarah Wenrich,

EpiPen, a product produced by Mylan Pharmaceutical, has become a household word in the last decade thanks to its reliable, life-saving technology that can be used to easily and safely administer epinephrine to someone experiencing anaphylaxis.[1] However, as EpiPens have become more well known, their prices have also increased over 500% within the last ten years,[2] even though the only noticeable difference was the addition of a flip-top cap on the case. [3] While the EpiPen’s widespread distribution is crucial in case of emergency, this extraordinary increase in price has caused patients who are in need of the product to refrain from filling their prescriptions because they cannot afford the cost.[4] The FDA has said that they will speed up the approval process for competitors or generic versions of the EpiPen[5], but the technology behind the EpiPen makes that much easier said than done. [6]

Most recently, Teva Pharmaceuticals submitted a product to the FDA that would directly compete with the EpiPen, but it was rejected in March of 2016. [7] While the reasons behind the rejection have not been made public, it has been speculated that it had to do with the design of the cap. Teva’s model had a cap that had to be unscrewed before use, whereas Mylan’s EpiPen does not.[8] This is an aspect of the design that Mylan actively lobbied against while Teva was awaiting approval. [9] Mylan reasoned that having to screw off the cap in an emergency could be confusing[10], but their own product has not been foolproof. There have been instances of patients confusing the needle end in emergencies and stabbing their thumbs instead of their thighs. [11]

Other companies have created competing products, but insurance companies refused to cover them, forcing the pharmaceutical companies to discontinue their production. [12] Adrenaclick was one of the products originally pulled from the market for this reason, but it has since returned.[13] Even with Adrenaclick back in the market, Mylan continues to hold 90% of the market share on epinephrine auto-injectors.[14] Contributing to this near monopoly is the fact that unlike most medical prescriptions where the pharmacist can swap out a name brand drug for a generic, the FDA has made it illegal for pharmacies to substitute alternatives, such as Adrenaclick, for the EpiPen.[15]

Perhaps most concerning aspect of the outrageous price increase of the EpiPen is the fact that people have begun to create their own DIY versions of the life-saving product, as they cannot afford to fill their prescriptions. [16] A group of men have created a YouTube video on how to build your own “EpiPencil” with items that you can purchase at the store, with the exception of the liquid epinephrine, which requires a doctor’s prescription.[17] Its design is bulky, but the video shows that it will adequately administer the drug in an emergency for less than $35.[18] However, patients and doctors alike are aware of the dangers that this could present in an emergency[19]. The “Epipencil” faces the hurdle of being unable to accurately administer the correct dosage of the drug, in addition to presenting other concerns associated with creating your own medical device, such as issues with sterilization.[20]

This potentially dangerous alternative to which people have turned showcases just how imperative the drug is to people with allergies that cause anaphylaxis. The patent for EpiPen’s design expires in 2025,[21]but it is clear that something must be done to combat EpiPen’s price hike before then. Right now, people with allergies that result in anaphylaxis have three choices: they can shell out $608 annually for an EpiPen, create their own EpiPencil for under $35 and face a slew of health risks, or hope that they do not come into contact with whatever it is that causes their anaphylaxis. For people who have insurance that covers the cost of the EpiPen or are financially able to foot the bill, the choice is an easy one. For others, it is a difficult choice that they should not have to make.

 

[1] See About EpiPen Auto-Injector, EpiPen, http://www.epipen.com/en/about-en/about-epipen (last visited Oct. 1, 2016).

[2] See Beth Mole, EpiPen maker CEO to seething lawmakers: We’re doing the world a favor, Ars Technica (Sept. 22, 2016, 2:25 PM), http://arstechnica.com/science/2016/09/epipen-maker-ceo-to-seething-lawmakers-were-doing-the-world-a-favor/.

[3] See Meghana Keshavan, 5 reasons why no one has built a better EpiPen, STAT (Sept. 9, 2016), https://www.statnews.com/2016/09/09/epipen-lack-of-innovation/.

[4] See Rising cost of potentially life-saving EpiPen puts pinch on families, CBS News (Aug. 16, 2016, 7:02 AM), http://www.cbsnews.com/news/allergy-medication-epipen-epinephrine-rising-costs-impact-on-families/.

[5] See Mole, supra note 2.

[6] See Keshavan, supra note 3.

[7] See Jonathan Newman, The Lack of EpiPen Competitors is the FDA’s Fault, Mises Institute (Aug. 24, 2016), https://mises.org/blog/lack-epipen-competitors-fdas-fault.

[8] See Michael Gibney, Could EpiPen’s plastic cap be Mylan’s secret weapon?, FiercePharma (Sept. 1, 2016, 4:21 AM), http://www.fiercepharma.com/drug-delivery/could-a-plastic-cap-epipen-have-given-mylan-its-market-dominance.

[9] See id.

[10] See id.

[11] See Keshavan, supra note 3.

[12] See Newman, supra note 7.

[13] See id.

[14] See Mole, supra note 2.

[15] See Brett Trout, Government is to blame for the skyrocketing price of EpiPens, not patents, IPWatchdog (August 29, 2016), http://www.ipwatchdog.com/2016/08/29/government-blame-price-epipens-patents/id=72412/.

[16] See Larson, supra note 16.

[17] See id.

[18] See id.

[19] See id.

[20] See id.

[21] See Gibney, supra note 8.

Photo Source:

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By: Nick Mirra,

When Google released its Google Glass platform in April of 2012 , the market was shaken by such a new and exciting innovation.[1] The glasses were touted to be innovative and invaluable to its users through features including: weather forecasting, reminders, GPS, taking photos, and recording video, among many others.[2] Ultimately, Google Glass fizzled out due to its expensive pricing structure and low sales.[3] Because Google vacated the market segment, (with the exception of a few less-publicized offerings in development) the opportunity to develop glasses-based tech was once again wide open.[4]

With the introduction of Spectacles, Snap Inc. (formerly known as SnapChat) is attempting to capture what Google and its competitors were never able to do.[5] Snap Inc.’s new product has streamlined the functionality of their smart eyewear product into something simple: glasses with an easy-to-use camera that photographs what you see.[6] Snap Inc. began their company as Snapchat, a photo sharing app which displayed photos for up to 10 seconds before the pictures vanished forever.[7] The brand’s Spectacles will be the first time the software company has ventured into the realm of hardware.[8]

Spectacles are set to retail for $130 which will make them accessible to most consumers who have a legitimate interest in them.[9] While it is impossible to forecast exactly how many units will sell, it is almost certain that more units of Spectacles will be sold than of Google Glass because of the significantly lower retail price.[10] With the potential to sell to the masses, familiar concerns of privacy that were raised by Google Glass are resurfacing at a rapid pace.

Snap Inc. has taken at least one step to safeguard against the privacy concerns. In anticipation of the discomfort that a wearable camera may cause the public, the company decided to place a ring of led lights on the front frame of the glasses that illuminate when the glasses are recording.[11] Even though the light ring is present, what is stopping someone from disabling it or covering it with a piece of tape? While that is a measure which may put some at ease, many members of the public may remain uncomfortable knowing that people are walking around with cameras pointing at them.

In response to various technological advancements, the expectation of privacy has evolved more frequently in the past decades than in any other period in history.[12] Prior to the digital age, the right to privacy was a more straightforward – albeit still complex – concept.[13] Now that the market is becoming saturated with wearable technologies such as Snap Inc.’s Spectacles, questions of privacy are popping up more than ever.[14] What are the consequences of constantly pointing a camera at everyone you see?

Google Glass faced a similar issue by having a camera mounted on the platform.[15] Glass was met with immense social opposition, including the product being banned from certain restaurants, movie theaters and other public venues.[16] The root of the issue stems from social discomfort with having a camera pointing everywhere you are looking.[17] Courts may soon be confronted with the issue of someone wearing the glasses in a setting which has legitimate expectations of privacy. What are the implications of someone wearing a head mounted camera in a bathroom or locker room? Why would it be okay to wear glasses that have a camera, but not walk in brandishing a standard handheld digital camera and pointing it at people?

While the concept of wearable technology is gaining traction and popularity, it is evident that the legal system needs to adapt to respond to the new issues. Perhaps it will require a lawsuit to bring these specific issues to light, but if Spectacles are wildly popular, a lawsuit is likely in the near future. Snap Inc. is basing their entire product on the one aspect of Google Glass that made the public uncomfortable. It is a head mounted camera that can be discreetly actuated. If someone walked into a bathroom with these glasses on, would you be comfortable?

 

[1] See The History of Google Glass, Glass Almanac, http://glassalmanac.com/history-google-glass/ (last visited 9/26/2016).

[2] See Evan Dashevsky & Mark Hachman, 16 Cool Things you can do with Google Glass, PC Mag, http://www.pcmag.com/slideshow/story/308711/16-cool-things-you-can-do-with-google-glass (last visited Sep. 26, 2016).

[3] See Jim Edwards, Google Ends Sale of Google Glass, Business Insider, http://www.businessinsider.com/google-ends-sales-of-google-glass-2015-1 (last visited Sep. 26, 2016).

[4] See Paul Lamkin, The Best Smartglasses 2016, Wareable, http://www.wareable.com/headgear/the-best-smartglasses-google-glass-and-the-rest (last visited Sep. 26, 2016).

[5] See Josh Constine, The Hopes and Headaches of Snapchat’s Glasses, Tech Crunch https://techcrunch.com/2016/09/24/more-than-just-specs/ (last visited Sep. 25, 2016).

[6] See Id.

[7] See Margaret Rouse, Snapchat, Search Mobile Computing, http://searchmobilecomputing.techtarget.com/definition/Snapchat (last visited Sep. 27, 2016).

[8] See Supra note 5.

[9] See Id.

[10] See Supra note 3. (Stating it is speculated that Google only sold around 10,000 units of Google Glass).

[11] See Supra note 5.

[12] See e.g., Heather B. Repicky, Reasonable Expectations of Privacy in the Digital Age, Nutter, http://www.nutter.com/Reasonable-Expectations-of-Privacy-in-the-Digital-Age-07-09-2012/ (last visited Sep. 27, 2016) (Discussing the concerns at the “increasingly complex intersection of privacy and technology).

[13]The Evolution of the Concept of Privacy, EDRi, https://edri.org/evolution-concept-privacy/ (last visited 9/27/2016).

[14] See id.

[15] See Jake Swearingen, How the Camera Doomed Google Glass, The Atlantic, http://www.theatlantic.com/technology/archive/2015/01/how-the-camera-doomed-google-glass/384570/ (last visited Sep. 26, 2016).

[16] See Alyssa Newcomb, From ‘Glassholes” to Privacy Issue: The Troubled Run of the First Edition of Google Glass, ABC News, http://www.consumerwatchdog.org/story/glassholes-privacy-issues-troubled-run-first-edition-google-glass (last visited Sep. 26, 2016).

[17] See id.

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By: Andrew Toney,

The Internet grows every second. Companies collect data from clients and store it on vast online databases, online shoppers trade their credit card numbers for groceries, and grandparents upload embarrassing pictures of their grandchildren on their MySpace pages. Some browsers create accounts on various websites that they may never visit again, leaving sensitive data behind a password less creative than my first-grade niece’s art projects. The Internet is meant for fun right? Much of the information that we share online is relatively meaningless, but, when we do provide sensitive data, we expect the web designers to keep that information a secret, right? So what are we, the consumer, supposed to do when covert criminals smuggle our data into their own hard drives? This blog post explores the expanding cyber-security industry, the protection of our privacy, and the new challenges emerging from our reliance on the Web.

Yahoo Inc. recently reported that 500 million of its user accounts were stolen in 2014, in what may be the largest data breach in the history of the Internet.[1] News has also broken on the Democratic Party’s recent frustration with hackers, who they believe have intercepted Party correspondence for over a year.[2] The most recent instance of online sabotage has come from the largest target of all – the White House. Government officials reported that they were currently “looking into” a cyber breach after a scan of Michelle Obama’s passport was posted online.[3] It would appear that the frequency of cyber attacks has not changed; indeed, cyber attacks are as old as the Internet itself. Rather, the sophistication and devastation of recent attacks has the US government and major companies sounding a call for action.

Many solutions offered by the government thus far have created a game of give-and-take between server security and rights to privacy. A highly contentious bill, the Cyber Intelligence Sharing and Protection Act (CISPA), is currently being debated in Congress.[4] CISPA is aimed at curbing cyber attacks by creating a data-sharing system between private companies and the federal government.[5] CISPA would allow major companies to share sensitive data with the government in order to identify and exterminate potential cyber-threats. Companies who agree to share client data would be free from any legal ramifications stemming from the release of sensitive client data.[6] Opponents of the bill point to the broad language defining a “cyber threat,” contending that an event as small as a spam email could warrant the release of personal information from local to federal authorities.[7] The original form of this bill was shot down in 2012 amid obvious concerns regarding Internet privacy. However, CISPA is making headway in the legislature as cyber attacks continue to threaten sensitive data held by major companies.

Private companies specializing in cyber-security technologies have taken a different route that may reduce such an impact on Internet privacy. An Israeli-based firm, Illusive Networks, is currently developing a system designed to misdirect hackers while simultaneously tracking their movements.[8] The design creates a series of false “doors” that hackers may choose to exploit in an attempt to reach a data payload in a valuable company server. If a hacker chooses the wrong door, then the company can detect the mistake and begin tracking movements on a simulated computer system.[9] The system is ultimately designed to frustrate hackers away from big business databases, but it also allows trackers to understand new methods used by hackers in order to prepare for future attacks. Of course, there is also a possibility that experienced hackers can avoid simulated systems in their infancy, further exposing sensitive company data.

The cyber security industry is experiencing rapid growth and for good reason. Huge companies are being exposed to legal action from their clients due to a lack of data protection, while classified documents held by the federal government are being leaked to the average Joe. The climate of fear surrounding this issue will certainly lead to some change in the near future. Will we allow our legislators to solve this issue for us, or will power ultimately fall to the engineers and programmers in the private sphere?

 

[1] Dustin Volz, Yahoo Says at Least 500 Million Accounts Hacked in 2014, Huffington Post (Sept. 22, 2015, 2:52 PM), http://www.huffingtonpost.com/entry/yahoo-hack-500-million-accounts_us_57e4278ce4b0e28b2b52da7f?section=us_technology.

[2] Ruth Sherlock, Russia Hacked Democratic National Committee Computer Network and Obtained All of its Trump Research, Telegraph (June 14, 2016, 7:45 PM), http://www.telegraph.co.uk/news/2016/06/14/russia-hacked-democrat-national-committee-computer-network-and-o/.

[3] Michelle Obama’s Passport Scan Posted Online in Apparent Hack, Telegraph (Sept. 23, 2016, 12:16 AM), http://www.telegraph.co.uk/news/2016/09/22/michelle-obamas-passport-scan-posted-online-in-apparent-hack/.

[4] H.R. 234 – Cyber Intelligence Sharing and Protection Act, Congress.gov, https://www.congress.gov/bill/114th-congress/house-bill/234/text.

[5] Jordan Pearson, America’s NewCybersecurity Agency Can’t Function Without CISPA, Vice (Feb. 10, 2015, 4:49 PM), http://motherboard.vice.com/read/americas-new-cybersecurity-agency-cant-function-without-cispa.

[6] Id.

[7] Jason Koebler, The New CISPA is Identical to the Old One, but the Political Climate is Scarier, Vice (Jan. 9, 2015, 11:44 AM), http://motherboard.vice.com/read/the-new-cispa-is-identical-to-the-old-one-but-the-political-climate-is-scarier.

[8] Lance Higdon, Cybersecurity Professionals are Using Misdirection to Combat Hacking, Vice (May 2, 2016, 11:33 AM), http://motherboard.vice.com/blog/cybersecurity-professionals-are-using-misdirection-to-combat-hacking.

[9] Id.

Photo Source:

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By: Cambridge Lestienne,

Paid brand endorsements are on the rise, and the trend seems to be causing a quite a stir for celebrities and marketers alike. Some social media and celebrity personalities, such as the Kardashian sisters, now find themselves at the center of an ethical debate over the nature of this form of advertising.[1] The issue at hand is whether these types of endorsements made by celebrities and public figures are deceptive because the individuals posting them are being paid for their posts. While celebrity Instagram and Snapchat accounts may be a visual example of such potentially deceptive advertising, the practice is also taking place in another booming media market that is not visual at all: podcasting.

As media transitions to more mobile consumption, podcasts continue to surge in popularity. Reports from both Edison Research and Wondery found that about 20% of adults in the U.S. listen to at least one podcast a month, which is an increase of 17% from last year.[2] This boom is likely due in part to the success of podcasts such as Serial, which had 75 million episode downloads within the first six months of its debut.[3] As the popularity of podcasts increases, so does their money-generating potential. Podcast advertising is up 48% over last year and projected to grow another 25% a year through 2020.[4] ZenithOptimedia estimates that advertisers will spend approximately $35.1 million on podcasts in 2016, up roughly 2% from 2015.[5]

While podcasters may not be posting visual advertisements like celebrities do on Instagram and Snapchat, they are still advertising on behalf of their sponsors. These advertisements are most often conducted through “host-read” ads.[6] According to Mark DiCristina, marketing director at MailChimp, one of the largest podcast advertisers, “When the host is personally reading the ad and telling a story about the product in her own words, it lands with the audience in a different and more authentic way than a traditional ad spot.”[7] But what happens when listeners are unaware that the podcast hosts are being paid to tell these personal stories? Are podcasters not falling into the same rabbit hole as celebrities like the Kardashians? And where does the law draw the line between paid endorsements and deceptive advertisements?

The Federal Trade Commission (“FTC”) has been grappling with this issue for years in light of developments in the social media space.[8] In its Guides Concerning the Use of Endorsements and Testimonials in Advertising, the FTC stated, “Advertisers are advised that using unrepresentative testimonials may be misleading if they are not accompanied by information describing what consumers can generally expect from use of the product or service.”[9] The FTC also stated that endorsers should avoid describing experiences with a product they have never used.[10] Endorsers should further disclose any connection between themselves and the marketer of a product that could affect how consumers evaluate the endorsement.[11]

Though the FTC has issued guidelines for advertising through endorsements, they have stopped short of enacting regulations on the practice.[12] This has led podcasters, like those from Gimlet Media, to question how they advertise on behalf of their sponsors.[13] In an effort to make the distinction between content and advertisements clear to listeners, Gimlet Media uses special musical backgrounds and disclaimers to notify listeners of when an ad has begun.[14] Additionally, while the hosts of Gimlet Media podcasts talk about their personal experiences using products, they have opted to stop explicitly endorsing the products of their sponsors.[15]

It seems that for the time being, podcasters, like celebrities on Instagram and Snapchat, should proceed with caution when advertising on behalf of their sponsors. A director of the FTC’s Bureau of Consumer Protection said, in relation to a settlement with Warner Bros. regarding paid endorsements, “Consumers have the right to know if reviewers are providing their own opinions or paid sales pitches.”[16] As media advertising continues to grow, specifically in the context of podcasts, it likely will not be long before firm regulations are put into place to constrain these potentially deceptive practices.

 

[1] See Sapna Maheshwari, Endorsed on Instagram by a Kardashian, But Is It Love or Just an Ad?, N.Y. Times (Aug. 30, 2016), http://www.nytimes.com/2016/08/30/business/media/instagram-ads-marketing-kardashian.html.

[2] See Andrew Meola, Podcasts are Becoming More Popular Among Listeners and Advertisers, Bus. Insider (Jun. 6, 2016, 11:07 AM), http://www.businessinsider.com/podcasts-are-becoming-more-popular-among-listeners-and-advertisers-2016-6.

[3] See Id.

[4] See Ken Doctor, An Island No More: Inside the Business of the Podcasting Boom, NeimanLab (Sept. 12, 2016), http://www.niemanlab.org/2016/09/an-island-no-more-inside-the-business-of-the-podcasting-boom/.

[5] See Steven Perlberg, Podcasts Face Advertising Hurtles, Wall St. J. (Feb. 18, 2016), http://www.wsj.com/articles/podcasts-face-advertising-hurdles-1455745492

[6] Ken Doctor, And Now a Word From Our Sponsor: Host-read Ads and the Play Between Nice and Scale, NeimanLab (Sept. 13, 2016,), http://www.niemanlab.org/2016/09/and-now-a-word-from-our-sponsor-host-read-ads-and-the-play-between-niche-and-scale/.

[7] Dino Grandoni, Ads for Podcasts Test the Line Betweem Story and Sponsor, N.Y. Times (Jul. 26, 2015), http://www.nytimes.com/2015/07/27/business/media/ads-for-podcasts-test-the-line-between-story-and-sponsor.html.

[8] See Manatt, Phelps & Phillips, LLP, Advertising Law – September 2016 #3, JD Supra (Sept. 22, 2016), http://www.jdsupra.com/legalnews/advertising-law-september-2016-3-88862/

[9] Fed. Trade Comm’n, The FTC’s Endorsement Guides: Being Up-Front with Consumers, https://www.ftc.gov/news-events/media-resources/truth-advertising/advertisement-endorsements.

[10] See id.

[11] See id.

[12] See Grandoni, supra note 7.

[13] See id.

[14] See id.

[15] See id.

[16] See Fed. Trade Comm’n, Warner Bros. Settles FTC Charges It Failed to Adequately Disclose It Paid Online Influencers to Post Gameplay Videos (Jul. 11, 2016), http://www.mediapost.com/publications/article/280028/ftc-warner-bros-paid-influencers-to-promote-vid.html?edition=94532.

Photo Source:

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By: Madison Jennings,

On July 6, 2016, North America experienced the beginning of a Pokémon craze the likes of which our nation had not seen since the nineties.

The release of Pokémon Go, an augmented reality video game designed to be played on a smart phone, had young and old alike dreaming of becoming Pokémon Masters. In true lawyerly fashion, however, the legal community immediately began to do all it could to ruin the fun. It adjusted its glasses, cleared its throat, and said, “Well, there are a lot of potential issues here, is this really such a good idea?”[1]

To which, of course, the world responded, “Please be quiet—I’m trying to catch a Charizard!”

Augmented Reality (or “AR”) is a gaming feature that inserts digital characters and checkpoints into the physical world, visible only via gaming device.[2] This is a not entirely new, if severely underused, gaming model. Pokémon Go creator Niantic has previously employed AR in its 2012 release titled ‘Ingress’.[3] In Ingress, players join factions and visit real-life monuments, cultural hubs, and other similar public areas which act as in-game ‘portals’ to win points, defeat their enemies, or whatever it is video game nerds do to feel a sense of accomplishment.[4] Pokémon Go follows much the same model.

You begin by downloading the game and creating an avatar, which you can design to look exactly (or nothing at all) like you. Once your character is ready, it will appear on a map and your phone will buzz as three familiar characters pop into view. Players can choose to tap on and attempt to capture either Charmander, Squirtle, or Bulbasaur. Once tapped, the Pokémon will appear on the screen as the app uses the phone’s camera to fill the background will real time images of your surroundings, giving the impression that Squirtle really is in your living room, your bathtub, or wherever else it is you were when you decided to give this Pokémon Go thing a try.

Once you’ve captured your first Pokémon, you’re encouraged to walk around to find more. In the bottom right of your screen, a small box offers silhouettes of nearby critters, enticing you to venture forth and find them.

Of course, to catch Pokémon, you need Pokéballs. To get Pokéballs, you need to find a Pokéstop. Pokéstops are real-world locations given digital properties by the game. Niantic uses the same ‘portals’ from its previous game (Ingress) as Pokéstops.[5] These locations were originally submitted by Ingress players, and can be anything from fountains and memorial benches to historical landmarks and restaurants.[6] You visit Pokéstops to get Pokéballs, you get Pokéballs to catch Pokémon, you catch Pokémon to, well, catch them all! The format is pleasantly simplistic, and imbued with just enough nostalgia for a remarkably popular childhood game for it to be instantly and infinitely more successful than any other mobile game in existence. Pokémon Go shattered the record for downloads in its first week from the Apple App Store.

That’s all very well and good, but where do the legal issues arise? What’s the problem, lawyers?

The problem is that newly developed technology dispersing into the population in such a rapid, uncontrolled way inevitably gives rise to previously unimagined legal issues. Not long after the game’s release, reports starting surfacing of players being lured into secluded areas by in-game treats (Lure Modules designed to attract digital Pokémon and real life trainers) and robbed, car accidents as a result of playing Pokémon Go while driving, and distracted players literally walking off of a cliff while hunting Pokémon.[7] Then, of course, there was the body camera footage of a player distractedly plowing into the rear of a parked police vehicle—he steps out of the car with the game still open on his phone screen, telling officers, “That’s what I get for playing this dumba— game.”[8]

Then, of course, the fascinating question: what are your rights, if there’s a Pokémon, a Pokéstop, or even a Pokémon Gym on your private property?

(Pokémon Gyms, like Pokéstops, are real world locations given digital significance by the game. At gyms, players can battle their Pokémon for a chance to earn some in-game currency.)

Often, gyms are located at churches, which proved to be a problem for a Massachusetts man living in a renovated church.[9]

When Boon Sheridan, of Holyoke, Massachusetts, moved into the former Victorian-style church with his wife, they did not anticipate that at some point dozens of individuals would begin showing up to loiter outside their front door, staring at their phone screens.[10]

Pokémon Go doesn’t typically place in-game locations onto private homes, and it’s fairly obvious that the inclusion of the Sheridan’s house was a mistake—a holdover from the home’s previous time spent as a church. Luckily, the couple play the game themselves, and don’t mind the visitors.[11] But if they did, would they have legal recourse to remove them?

Against the players—probably. Trespassing is likely to still be considered trespassing, whether the individual is there for a physical or digital purpose. But what about Niantic? Would the Sheridans have a cause of action against the company for giving his private property a digital attribute they hadn’t approved of, thus enticing strangers to trespass?

And what of the liabilities a homeowner could have for strangers wandering onto their property in pursuit of Pokémon? Generally speaking, property owners aren’t liable for injuries suffered by trespassers, but anyone who owns a pool is familiar with the doctrine of attractive nuisance.[12] The idea behind attractive nuisance is that some things are just too enticing, particularly to children, and as a result property owners are liable regardless of whether a person is a trespasser.[13] Is a Pokémon Gym an attractive nuisance? Does it depend upon whether a child is playing the game? What about a trespasser tracking down a Pokémon, which are generated in a somewhat random manner, and appear on private property regularly? Does it matter whether the property owner is aware of the digital features given to their real property by a third party?

Does the fact that their home is a Pokéstop increase or decrease the Sheridans’ property value? Are they obligated to disclose the status to potential buyers, in the event they decide to sell their house?

In the context of Pokémon, all of these questions seem a tad silly, but the fact is that at this moment, none of these questions have actual answers. When it comes to AR, the legal field is brand new, and any cases brought because of Pokémon Go will end up shaping the playing field and establishing the rules for future augmented reality endeavors. Keep a close eye on these issues as they develop; I promise it isn’t just lawyers trying to ruin everybody’s fun.

 

 

[1] See Ed Beeson, Pokémon No Go: How Lawyers Are Spoiling The Fun With The World’s Latest Craze, Law360, July 22, 2016, http://www.law360.com/articles/820143/pokemon-no-go-how-lawyers-are-spoiling-the-fun-with-the-world-s-latest-craze-.

[2] See Dave Thier, What Is Pokémon Go And Why Is Everyone Talking About It?, Forbes, July 11, 2016, http://www.forbes.com/sites/davidthier/2016/07/11/facebook-twitter-social-what-is-pokemon-go-and-why-is-everybody-talking-about-it/#6e0813b21c7b.

[3] See Alan Henry, How Ingress, Google’s Real-World Smartphone Game, Got Me Out of My Shell, Lifehacker, June 10, 2015, http://lifehacker.com/how-ingress-googles-real-world-smartphone-game-got-me-1710320867.

[4] See id.

[5] See Andrew Hayward, Why Pokémon Go Fans Should (Or Shouldn’t) Play Ingress, Greenbot, July 26, 2016, http://www.greenbot.com/article/3097573/android/why-pokemon-go-fans-should-or-shouldnt-play-ingress.html.

[6] See id.

[7] See Eric Lindfield, Pokémon Go’s Product Liability Woes, Law360, Aug. 3, 2016, http://www.law360.com/articles/824588/pokemon-go-s-product-liability-woes.

[8] PoliceActivity, Bodycam Shows Driver Playing Pokémon Go Crashes Into Police Car, YouTube (Jul. 19, 2016), https://www.youtube.com/watch?v=KvA9ZgC73vc.

[9] Madeline Billis, This Church-Turned-House Is Also An Unwilling Pokémon Gym, Boston Magazine, July 11, 2016, http://www.bostonmagazine.com/property/blog/2016/07/11/church-house-pokemon-go-gym/.

[10] See id.

[11] See id.

[12] See supra note 1.

[13] See id.

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