Richmond Journal of Law and Technology

By Alyssa Thompson

 

Introduction

Since 1997, select states have been collecting DNA samples from particular arrestees.[1] Between 2006 and 2011, twenty-three states passed legislation authorizing this practice.[2] As of 2013, thirty states and the federal government take part in DNA collection of certain arrestees.[3] Around half of the states collecting DNA collect for any felony, while the other half limits collecting from violent felonies or sex crimes.[4] As of 2013, eight states collect for select misdemeanors.[5] Additionally, eight states and the federal government collect from juveniles.[6]

Samples are taken via a buccal swab.[7] This has become a popular method as it is seen as a minimally invasive method of DNA collection.[8] The swab is placed inside the check and obtains DNA in the form of buccal epithelial cells.[9] If an inmate refuses, the federal government instructs testers to use force to obtain the sample.[10] If carried out correctly, buccal swabs are just as accurate as blood tests.[11]

Processed samples are entered into the Combined DNA Index System (“CODIS”), a national database containing samples contributed by federal, state, and local forensic laboratories.[12] According to the FBI, these DNA samples identify offenders, exclude innocent persons, solve past and future crimes and combat recidivism.[13] Further, DNA samples in this context have solved a number of cold cases.[14]

States differ on how they destroy the samples if the charges brought do not lead to conviction.[15] The majority of states only destroy the sample upon request, meaning the individual, against whom charges were brought and subsequently dropped or lead to acquittal or dismissal, must bear the burden of getting the sample expunged.[16] It can cost anywhere from $50 to $500 to expunge a record.[17] In states that require the individual to initiate the expungement process, very few expungements occur.[18] This is likely due to a lack of informing individuals of their right to have their record expunged coupled with the costs of expungement.

Fourth Amendment Concerns

DNA collection is undoubtedly a search. Under the Fourth Amendment there are two contexts in which a search can take place. First there is the investigatory context. Under this context, if there is an objective justification for the action, a law enforcement officer’s subjective intent is not relevant to a court’s inquiry of the matter.[19] The second context is the special needs context. Subjective intent does matter when there is no objective justification for the search. This includes inventory searches and administrative searches. Law enforcement may not use the special needs context as a way to get around the 4^th amendment – the search must be for the reason law enforcement purports it to be (i.e., inventory or identification). Until 2013, the question was under which context did DNA collection of arrestees reside?

In Maryland v. King the Supreme Court indicated that DNA testing of felony arrestees resided in in the special needs context.[20] This means that the subjective intent of law enforcement should matter. Yet, the majority held that the DNA collection was for identification and that identification was the subjective intent of law enforcement.[21] Thus, the practice was held Constitutional under the 4^th amendment.[22]

Personally, it’s hard to imagine that the actual subjective intent of law enforcement for collecting DNA is to identify the arrestee. As the dissent in King points out, the average response time for identification based on fingerprints is about 27 minutes.[23] However, DNA samples can take months to come back with identification.[24] Further, the fingerprint database includes “detailed identification information, including ‘criminal histories; mug shots; scars and tattoo photos; [and] physical characteristics like height, weight, and hair and eye color.’”[25] CODIS contains none of this, not even a name.[26] The only identification happening with CODIS is the matching of an already known individual to an unknown sample of DNA.

The dissent in King argued that the DNA was being used under an investigatory purpose, therefore the government should need probable cause before collecting the DNA.[27] However, probable cause for cold cases will rarely exist as the police did not have the probable cause needed to arrest the person for the initial crime in the first place.

Despite these arguments, DNA collection of an arrestee has been deemed Constitutional under the 4^th amendment.

Conclusion

There is no dispute that DNA collection of arrestees aids in the accuracy of the criminal justice system. The results can exclude innocent persons and solve past and future crimes.[28] While the states and federal government hail the buccal swab as minimally invasive, it may be argued that the information of which it is capable of obtaining makes it signicantly invasive, not the procedure itself.

I hold serious doubts as to whether DNA collection from arrestees is a Constitutional practice under the 4^th amendment. I agree with the dissent in Maryland v. King. Under their reasoning, the police must at least have probable cause to swab for DNA. In the context of decades old cold cases, the police surely do not have the probable cause needed to search the arrestee for the cold case because if they had it, they would’ve already searched and arrested the arrestee. In that sense, law enforcement is taking a dragnet approach to investigating crime. That sort of approach is not supported by the particularity requirement of the 4^th amendment.

 

[1] Julie Samuels et al., Collecting DNA From Arrestees: Implementation Lessons, 270 NIJ J. 18, 19 (2012) (citing Louisiana as the first state to authorize DNA collection from arrestees).

[2] See id.

[3] Nat’l Conf. of State Legis., DNA Arrestee Laws (2013) [hereinafter “DNA Arrestee Laws”].

[4] Samuels et al., supra note 1, at 21.

[5] DNA Arrestee Laws, supra note 3.

[6] Id.; Samuel et al., supra note 1.

[7] DNA Arrestee Laws, supra note 3.

[8] See What Is a Buccal Swab?, Dynamic DNA Laboratories (Mar. 18, 2019), https://dynamicdnalabs.com/blogs/news/what-is-a-buccal-swab.

[9] Id.

[10] Fed. Bureau of Prisons, Inmate DNA Sample Collection Procedures (2010) [hereinafter “Inmate DNA Sample Collection Procedures”].

[11] What is a Buccal Swab?, supra note 8.

[12] Rebecca Beitsch, DNA Upon Arrest: Solving Cold Cases or Presuming Guilt?, PEW (Jan. 12, 2017), https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2017/01/12/dna-upon-arrest-solving-cold-cases-or-presuming-guilt; Frequently Asked Questions on CODIS and NDIS, FBI, https://www.fbi.gov/services/laboratory/biometric-analysis/codis/codis-and-ndis-fact-sheet.

[13] Inmate DNA Sample Collection Procedures, supra note 10.

[14] Samuels et al., supra note 1, at 18 (noting the CODIS match that solved a rape case from a decade earlier); Maryland v. King, 549 U.S. 435 (2013) (solving a 6-year-old unsolved rape case); see also Michelle Taylor, Texas: Arrestee DNA Collection Solved Over 250 Cases in One Year, Forensic Mag (Nov. 20, 2020), https://www.forensicmag.com/570491-Texas-Arrestee-DNA-Collection-Solved-Over-250-Cases-in-One-Year/.

[15] Samuels et al., supra note 1, at 23.

[16] See id.

[17] Beitsch, supra note 12.

[18] Samuels et al., supra note 1, at 23.

[19] See Whren v. United States, 517 U.S. 806 (1996).

[20] King, 549 U.S. (2013).

[21] Id. at 465-66.

[22] Id.

[23] Id. at 478.

[24] Id.

[25] Id.

[26] Id.

[27] Id. at 466.

[28] See Inmate DNA Sample Collection Procedures, supra note 10.

Image Source: https://dynamicdnalabs.com/blogs/news/what-is-a-buccal-swab

By Nate Gilmore

 

The Fourth Amendment reads in part that “[t]he right of the people to be secure in their persons, houses, and effects, against unreasonable searches and seizures, shall not be violated. . . .”[1] This has been the bedrock of privacy protection since 1791. Nevertheless, as technology advances, debates have broken out over whether drone surveillance will “outflank” this Fourth Amendment right to privacy.[2] Last March, however, the Michigan Court of Appeals ruled in Long Lake Township. v. Maxon that drone footage of private property did constitute a search, and therefore a warrantless application violated the Fourth Amendment.[3]

In the landmark case of Katz v. United States, the Supreme Court held that a reasonable expectation of privacy (both subjective and objective) is required to constitute a search under the fourth amendment.[4] The Supreme Court has subsequently made it clear that, in the world of aerial surveillance, the police need not obtain a warrant when observing what is visible with the naked eye.[5] Faced with yet another decision possibly shrinking privacy rights, the Court took a promising turn in Kyllo v. United States. Law enforcement officers used a heat-sensing device to scan an apartment complex to determine if the heat coming from the building was consistent with the high-temperature lamps used for marijuana growing.[6] Justice Scalia, writing for the majority, held that when the government uses technology not in general public use to “explore details of the home that would previously have been unknowable without physical intrusion. . . .” then it constitutes a search.[7] Justice Scalia voiced his concern with the power of technology shrinking the right to privacy, stating that “[r]eversing this approach would leave the homeowner at the mercy of advancing technology-including imaging technology that could discern all human activity in the home.”[8] These concerns over technology more capable than the naked eye might have just saved the right to privacy in drone surveillance.

In Long Lake Township. v. Maxon, Long Lake Township used a drone to fly over the Maxon family residence after a growing suspicion that the family was violating a zoning ordinance by operating an illegal “junkyard.”[9] The Maxon family moved to suppress the drone footage as part of an illegal “search.”[10] The trial court initially denied the defendant’s motion to suppress, finding that the defendants lacked a reasonable expectation of privacy under Ciraolo and Riley.[11] The Michigan Court of Appeals relied heavily on Kyllo in its reversal, comparing how both heat-sensing technology and “low altitude, specifically targeted drone surveillance” of private property are distinct from the human-operated aircraft in both Ciraolo and Riley.[12] The speed and stealth of a drone makes it “capable of drastically exceeding the kind of human limitations that would have been expected by the framers not just in degree, but in kind.”[13]

The powerful holding presented will hopefully be the catalyst for courts across the country in the fight for privacy against drone use: “[W]e conclude that persons have a reasonable expectation of privacy in their property against drone surveillance, and therefore a government entity seeking to conduct drone surveillance must obtain a warrant. . . .”[14]

 

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

[2] John Villasenor, Will Drones Outflank the Fourth Amendment?, Bookings (Sept. 20, 2012), https://www.brookings.edu/opinions/will-drones-outflank-the-fourth-amendment/.

[3] Long Lake Twp. v. Maxon, No. 349230, 2021 WL 1047366 (Mich. Ct. App. Mar. 18, 2021).

[4] 389 U.S. 347 (1967).

[5] See California v. Ciraolo, 476 U.S. 207 (1986) (finding that police flying in public airspace 1000 feet over the property is not a search under the Fourth Amendment even though privacy fences surrounded the yard from ground level); see also Florida v. Riley, 488 U.S. 455 (1989) (finding that police observation of a partially exposed greenhouse from a helicopter 400 feet in the air did not constitute a “search” under the Fourth Amendment).

[6] Kyllo v. United States, 533 U.S. 27, 29 (2001).

[7] Id. at 40.

[8] Id. at 28.

[9] Long Lake Twp., 2021 WL 1047366 at *1.

[10] Id.

[11] Id. at *2.

[12] Id. at *6.

[13] Id.

[14] Id. at *7.

Image source: https://www.publicradiotulsa.org/local-regional/2019-02-11/measure-aims-to-regulate-drone-use-over-private-property

By Troy Fowler

 

It seems like every day we see another public figure elect to take some or all of their compensation in Bitcoin. I consider their incentive for doing so, and how such compensation is treated from an income tax standpoint.

Bitcoin is Insulated From the Causes of Inflation

The US Dollar lacks the purchasing power it had a year ago. Inflation has soared to its highest levels since 1990.[1] The average price of non-volatile consumer goods (consumer price index) rose 6.2 percent for the 12 months ending in October 2021.[2] The energy index rose 30 percent over that same period as the food index increased 5.3 percent.[3] While private industry workers have seen an average pay raise of 4.2 percent over the past year, the raise that many have received does not fully account for increases in the price of goods.[4]

Multiple federal “stimulus” packages amounting to a staggering $6 trillion in new spending purported to put more money into Americans’ pockets,[5] but the combination of artificially increased demand and reduced supply has led to shortages which have caused consumer prices to skyrocket.[6] To preserve the otherwise shrinking value of their hard-earned dollars, many Americans have looked to Bitcoin as a hedge against inflation. In October, JPMorgan published a research note to its clients stating that “Institutional Investors appear to be returning to bitcoin perhaps seeing it as a better inflation hedge than gold.”[7]

As opposed to the dollar which is a “fiat” currency backed by government rather than a physical commodity or financial instrument,[8] and which can be printed infinitely as the Federal Reserve sees fit, new Bitcoins are introduced into circulation in a manner analogous to gold miners expending resources to add gold to circulation.[9] In the case of Bitcoin, it is CPU time and electricity that is expended.[10] The “hard cap” on the supply of Bitcoin is a fundamental driver behind Bitcoin’s value proposition such that, although a (theoretically possible) change in the hard cap “would increase miner revenue in bitcoin terms, the loss of faith in the Bitcoin network would result in a catastrophic and irreversible price collapse, leading to a net loss of miner revenue in fiat terms.”[11] The finite number of Bitcoins that can ever come into existence ensures that once the hard cap is reached, Bitcoin can exist inflation-free.[12]

Many public figures have begun to request payment in Bitcoin as an alternative to the inflated US Dollar.[13] The newly elected Mayor of New York, Eric Adams, announced that he will receive his first three paychecks in Bitcoin.[14] Various professional athletes have also begun to take their salaries, signing bonuses, and endorsement earnings in the world’s number one cryptocurrency.[15] On 12/29/2020, when NFL offensive lineman Russell Okung tweeted that $6.5M—half of his $13M salary—had been “paid in Bitcoin,”[16] the price of the cryptocurrency was around $26,000 per coin.[17] Mr. Okung’s $6.5M investment at $26,000 per coin has increased to a value of $15M at the current price just north of $60,000—a 130% gain.

Tax Treatment of Bitcoin

Typically, compensation for services constitutes gross income which is taxable at “ordinary” rates.[18] However, the IRS treats cryptocurrencies like Bitcoin as property for federal tax purposes.[19] Property is a capital asset,[20] and capital assets are taxable at much lower rates.[21] Capital assets tend to be investment property upon which gains are only supposed to occur in the relatively unusual event that such property is sold. In tax law, no dollar can be taxed until its value has been “realized,” which requires an undeniable accession to wealth.[22]

All income is taxed at ordinary rates unless there is a net capital gain.[23] If a capital asset held for more than one year is sold at a gain (long-term capital gain) and said gain is greater than the amount lost from the sale or exchange of other capital assets held for less than a year (short-term capital loss), the taxpayer has a net capital gain which should be taxed according to capital, as opposed to ordinary, rates.[24] While the highest marginal tax rate (rate at which the last dollar of income is taxed) for ordinary income is 37%, the highest marginal tax rate for capital gains is just 20%.[25] If a taxpayer can hold off on liquidating a capital asset for more than a year, they can take advantage of substantial tax savings.[26]

Let’s assume a taxpayer is able to hold onto their Bitcoin for longer than a year. It is no secret that the price of Bitcoin is volatile, but on an upward trajectory.[27] To determine whether the taxpayer has realized a gain or loss upon their sale of Bitcoin, the tax code considers the original cost to the taxpayer.[28] This cost (called “basis”) is subtracted from any amount realized from a sale to determine whether there is gain or loss.[29] When an employee is paid in Bitcoin, they receive basis of the Fair Market Value (“FMV”) of Bitcoin at the time of the transfer.[30]

When compensation is paid on a fixed schedule, the taxpayer’s basis for each receipt of Bitcoin is different, since its FMV was different each time they received payment. Because they will be taxed on the difference between the FMV at liquidation and their basis in that particular receipt,[31] it follows that they should sell the highest basis portions of Bitcoin first. This would result in the lowest possible tax liability. Portions with lower basis should either be held until the price drops, or until the price increases so much that the tax hit is negligible compared to the substantial gain.

Popular investing apps like Robinhood do not allow users to determine which specific unit they want to sell.[32] Rather, Robinhood sells your funds in first-in-first-out (“FIFO”) order.[33] Assuming the asset has increased in value, the lowest basis holdings will be sold first, resulting in a higher tax liability since (taxable) gain equals amount realized minus basis. A person receiving compensation in Bitcoin should make sure their broker of choice does not impose this limitation.

The IRS has stated that a taxpayer may choose which units they wish to sell if they can specifically identify which unit or units are involved in the transaction and substantiate their basis in those units.[34] The taxpayer must provide records detailing the transaction information for all units of Bitcoin they hold in a single account, wallet, or address.[35] These records must include: (1) the date and time each unit was acquired, (2) the basis and the fair market value of each unit at the time it was acquired, (3) the date and time each unit was sold, exchanged, or disposed of, and (4), the fair market value of each unit when sold, exchanged, or disposed of, and the amount of money or the value of property received for each unit.[36] If a taxpayer fails to specify or is otherwise unable to do so, the units will be deemed to be sold in chronological (FIFO) order.[37]

Conclusion

Capital treatment is reserved for assets that are held for more than one year, the disposal of which constitutes an uncommon occurrence. The IRS treats Bitcoin as property, which is a capital asset taxed at capital rates, so long as it is held for more than one year and the taxpayer’s net long-term capital gains exceed their net short-term capital losses. Because the code taxes capital income at a rate much lower than ordinary income, it is in the taxpayer’s best interest to hold onto Bitcoin for more than one year before selling.

When Bitcoin held for less than one year is liquidated, it is subject to the same tax rate as if the taxpayer had simply received compensation in cash. Therefore, a taxpayer should ensure they can cover their normal expenses with other funds before committing to receiving compensation in Bitcoin. Implicit in the choice to receive compensation in Bitcoin is the hope that its value appreciates. Regardless, the volatility of the market makes short-term investing a risky decision. Additionally, the IRS’ determination that Bitcoin is property, and thus a capital asset, indicates that it believes Bitcoin should be held for investment purposes rather than used as a cash equivalent for compensation. Because Bitcoin is viewed as a store of value, immune from inflationary weakening, it makes sense to hold the asset for as long as possible while the price increases. This cannot be achieved if the taxpayer is forced to liquidate their holdings to cover their expenses.

At this point in time, it might make sense for high income earners like professional athletes to receive compensation in Bitcoin. However, for the majority of Americans who depend on their paychecks to cover any expenses they might incur in a given taxable year, Bitcoin is better suited for investment of discretionary income that the taxpayer wishes to protect from the pressures of inflation.

 

[1] Bureau of Labor Statistics, News Release USDL-21-1973, Consumer Price Index – October 2021 (Nov. 10, 2021).

[2] Id.

[3] Id.

[4] Bureau of Labor Statistics, News Release USDL-21-1907, Employment Cost Index – September 2021 (Oct. 29, 2021).

[5] Staff of the J. Econ. Comm., 117th Cong., The Economics of Inflation and the Risks of Ballooning Government Spending (Oct. 6, 2021), https://www.jec.senate.gov/public/index.cfm/republicans/2021/10/the-economics-of-inflation-and-the-risks-of-ballooning-government-spending (Rep. of Jackie Benson).

[6] Id.

[7] Kevin Helms, JPMorgan: Institutional Investors Dump Gold for Bitcoin Seeing It as Better Inflation Hedge, Bitcoin.com (Oct. 7, 2021), https://news.bitcoin.com/jpmorgan-institutional-investors-dump-gold-for-bitcoin-better-inflation-hedge/.

[8] Fiat vs. Representative Money: What’s the Difference?, Investopedia (Sept. 14, 2021), https://www.investopedia.com/ask/answers/041615/what-difference-between-fiat-money-and-representative-money.asp#:~:text=Fiat%20money%20is%20a%20form,physical%20commodity%20or%20financial%20instrument.

[9] Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System, Bitcoin.org 4 (Oct. 31, 2008), https://bitcoin.org/bitcoin.pdf.

[10] Id.

[11] Can Bitcoin’s Hard Cap of 21 Million Be Changed?, River Financial, https://river.com/learn/can-bitcoins-hard-cap-of-21-million-be-changed (last visited Nov. 19, 2021).

[12] See Nakamoto, supra note 9 (explaining the various economic incentives for miners to support the blockchain).

[13] Jazmin Goodwin, Forget cash. Pay me in bitcoin, CNN Business (Nov. 13, 2021), https://www.cnn.com/2021/11/13/business/money/cryptocurrency-bitcoin-salary-feseries/index.html.

[14] Id.

[15] Id.

[16] Jonathan Warner, Former Seattle Seahawk Russell Okung puts half of salary in Bitcoin, considered highest paid in the league now, NBC Sports (Feb. 22, 2021, 5:54PM ET), https://www.nbcsports.com/northwest/seahawks/former-seattle-seahawk-russell-okung-puts-half-salary-bitcoin-considered-highest.

[17] Bitcoin USD Historical Data, Yahoo Finance, https://finance.yahoo.com/quote/BTC-USD/history (last visited Nov. 19, 2021).

[18] I.R.C. §§ 1(j), 61(a)(1).

[19] I.R.S. Notice 2014-21, IRB 2014-16.

[20] I.R.C. § 1221(a).

[21] I.R.C. § 1(h).

[22] Comm’r v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955).

[23] I.R.C. §§ 1(h), 1222(11).

[24] I.R.C. §§ 1(h), 1222(2), (7), & (11).

[25] I.R.C. § 1(h), (j).

[26] See id.

[27] See Bitcoin USD Historical Data, supra note 17.

[28] I.R.C. §§ 1001(a), (b), 1011, 1012.

[29] Id.

[30] Int’l Freighting Corp. v. Comm’r, 45 B.T.A. 716, 720–21 (1941).

[31] I.R.C. § 1001(a), (b).

[32] Popular Investing Apps Might Hold a Tax Surprise, WSJ Noted (Apr. 16, 2021), https://www.wsj.com/articles/popular-investing-apps-might-hold-a-tax-surprise-11618610064?mod=hp_noted_tophat.

[33] Id.

[34] Frequently Asked Questions on Virtual Currency Transactions at A39, Internal Revenue Service (June 4, 2021), https://www.irs.gov/individuals/international-taxpayers/frequently-asked-questions-on-virtual-currency-transactions.

[35] Id. at A40.

[36] Id.

[37] Id. at A41.

Image Source: https://financeillustrated.com/wp-content/uploads/2021/05/44-768×494

By Ben L. Culpepper

 

After January 6, 2020, big tech took unprecedented measures to prevent the spread of misinformation on their platforms.[1] These measures included banning then-president Trump from using their websites, along with Amazon entirely dispensing of Parlor, a right-wing social media alternative to Twitter.[2] However, the role of big tech companies such as Twitter and the policing of information raises new legal questions.[3] Those being censored or flagged as spreading misinformation argue their first amendment right to free speech is being breached.[4] On the other hand, advocates of monitoring what information can be posted to Twitter argue Twitter is not doing enough to censor misinformation.[5] And, behind the scenes of it all, the federal government looms in the background pressuring big tech to cut out misinformation or face federal legislation punishing big tech.[6]

The journey to the censorship levels of January 6, 2020, started from a very different place. In 2011, relatively early in Twitter’s existence, a reporter named Anita Sarkeesian was the subject of terrible threats on the company’s platform.[7] These threats included specific threats of rape, physical violence, and outright racism in general.[8] The online trolls even made a video game depicting Sarkeesian and giving players the option to punch her in the face.[9] According to Sarkeesian, when she reported the threats to Twitter, all Twitter mustered was “The account [reported] is not currently in violation of the Twitter Rules.”[10] Only when Sarkeesian publicly tweeted Twitter’s nonchalant response did Twitter step in and take action.[11]

Today, Twitter has three specific types of misinformation labels that the company attaches to tweets that it deems are “false and misleading.”[12] Twitter has rapidly increased its speech monitoring policies in the wake of public and federal criticism, almost instantly flagging potentially false or misleading information on its platform.[13] This is a drastic change from where the company began in 2011 during Sarkeesian’s story.[14] Nadine Strossen, professor of law at New York Law School, argues that the first amendment of our Constitution only protects against free speech violations that come from the government.[15] Accordingly, Strossen asserts that there is no first amendment violation in Twitter monitoring free speech.[16] Thus, Twitter, as a private sector entity, has no obligation to protect any freedom of speech.[17] In fact, quite the opposite, she argues. Twitter can freely remove those who violate its terms of use whenever Twitter pleases.[18]

On the other hand, those being censored and advocates of total free speech on social media platforms argue that Twitter engages in selective enforcement, suggesting political motives.[19] Free speech proponents assert that big tech companies have a Constitutional obligation to allow for the free flow of information on their platforms.[20] Otherwise, Congress, through regulatory threats and statutory inducements, is merely using big tech to accomplish what it itself is unable to do: cut out speech it deems false or misleading.[21] To support this claim, free speech advocates point to threats Democratic lawmakers in Congress have issued at Twitter.[22] Furthermore, Section 230 of the Communications Decency Act allows tech companies to censor what may otherwise be Constitutionally protected speech without facing legal consequences.[23] Free speech advocates assert that Section 230, paired with Democratic threats, amounts to state action via private entities which infringes on the rights guaranteed in our Constitution.[24]

As Twitter and other big tech companies continue to ramp up their speech monitoring policies, the big question looming in the background grows in size and shape: is big tech acting as a medium for state action, or is it merely trying to enforce policies against false and misleading information? This is a fine line big tech has been treading carefully, and if Congress decides big tech isn’t doing enough, federal statutory regulations are just around the corner.

 

[1] Jessica Guynn, President Trump Permanently Banned from Twitter over Risk He Could Incite Violence, USA Today (Jan. 8, 2021), https://www.usatoday.com/story/tech/2021/01/08/twitter-permanently-bans-president-trump/6603578002/.

[2] Glenn Greenwald, Congress Escalates Pressure on Tech Giants to Censor More, Threatening First Amendment (Feb. 20, 2021), https://greenwald.substack.com/p/congress-escalates-pressure-on-tech.

[3] Id.

[4] Vivek Ramaswamy & Jed Rubenfield, Save the Constitution from Big Tech, Wall St. J. (Jan. 11, 2021), https://www.wsj.com/articles/save-the-constitution-from-big-tech-11610387105.

[5] Greenwald, supra note 2.

[6] Id.

[7] Emily Greenhouse, Twitter’s Free-Speech Problem, Science and Tech (Aug. 1, 2013), https://www.newyorker.com/tech/annals-of-technology/twitters-free-speech-problem.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Barbara Ortutay, Twitter Rolls Out Redesigned Misinformation Warning Labels, ABC News (Nov. 16, 2021), https://abcnews.go.com/Technology/wireStory/twitter-rolls-redesigned-misinformation-warning-labels-81212172.

[13] Id.; see Greenwald, supra note 2.

[14] See Greenhouse, supra note 7.

[15] Nadine Strossen, Does the First Amendment Apply to Social Media Companies?, Talks on Law (Mar. 21, 2020), https://www.talksonlaw.com/briefs/does-the-first-amendment-require-social-media-platforms-to-grant-access-to-all-users.

[16] Id.

[17] Id.

[18] Id.

[19] Ramaswamy, supra note 4.

[20] Id.

[21] Id.

[22] Id. (quoting Louisiana Representative Cedric Richmond “We’re going to make it swift, we’re going to make it strong, and we’re going to hold them very accountable,” and New York Representative Jerry Nadler “Let’s see what happens by just pressuring them.”).

[23] Id.

[24] Id.

Image Source: https://unsplash.com/s/photos/twitter

 

By Walker Upchurch

 

The United States is embroiled in an opioid crisis, and throughout the Covid-19 pandemic, it has only gotten worse. According to the Center for Disease Control, during a 12-month long study, the provisional data showed that during COVID, opioid-related deaths rose by over 28%.^[1] The states that have been hit the hardest are Louisiana, Mississippi, Tennessee, Kentucky, West Virginia, and Vermont.^[2] Likewise, only South Dakota, New Hampshire, New Jersey, and Delaware were the states that had a lower opioid-related 12-month death count.^[3] In response to this study, USA Today spoke with Dr. Paul Christo, an associate professor of anesthesiology and critical care at Johns Hopkins University School of Medicine, who stated: “Two forces here are the negative economic impact of the pandemic as well as the emotional impact… That led to a lot of people to use drugs … to cope.”^[4] Thus, the downturn in the economy naturally led individuals to illegal street drugs such as heroin and fentanyl.^[5] Fentanyl had initially been developed as a pain management drug to treat terrible diseases such as cancer and help patients after open surgery.^[6] Its effectiveness in pain management has been well noted, and it has since developed a reputation as an additive to other street drugs for a powerful impact. Currently, the United States has seized so much illegal fentanyl on the street that it would be enough to deliver lethal doses to every Citizen, according to the DEA Administrator Anne Milgram.^[7]

To combat the rising opioid problem, the state of California had attempted to hold the pharmaceutical companies accountable in court as they brought suit against a plethora of drug companies citing a public nuisance in their case California V. Purdue Pharma L.P. e.t al.^[8] The state of California argued that the pharmaceutical industry had advertised opioid drugs, which subsequently led to pain pills overtaking their communities.^[9] The state of California was seeking $50,000,000,000 in this lawsuit against numerous pharmaceutical companies such as Johnson & Johnson, Purdue Pharma, and Actavis.^[10] However, for the first time in more than 3,300 lawsuits, the pharmaceutical industry won.^[11] Judge Peter Wilson stated that “There is simply no evidence to show that the rise in prescriptions was not the result of the medically appropriate provision of pain medications to patients in need.^[12] Additionally, he stated that “even if the drug makers’ marketing contained any misleading statements, the counties put forward no evidence to show that their promotional activities caused any medically inappropriate prescriptions to be written. The Court went on to say that the Plaintiff failed to prove an actionable public nuisance claim against the defendants.^[13] Likewise, they found that none of the marketing materials’ identified statements were false or misleading. ^[14]

This is an interesting case as it could foreseeably embolden the pharmaceutical industry in their lawsuits and advertising of opioid drugs as their actions did not rise to or constitute an actionable public nuisance. Likewise, it may make state governments warrier in investing the time, resources, and energy required to take on such a massive case. While it is by no means a get out of jail free for the pharmaceutical industry as Johnson & Johnson, McKesson, Cardinal Health Inc., and AmerisourceBergen will all be paying out up to $26 Billion to settle other cases, it does create the precedent that the pharmaceutical companies will continue to rely on going forward.^[15]

 

^[1] Ahmad FB, Rossen LM, & Sutton P., Provisional drug overdose death counts, NATIONAL CENTER FOR HEALTH STATISTICS, CDC (2021), https://www.cdc.gov/nchs/nvss/vsrr/drug-overdose-data.htm.

^[2] Id.

^[3] Id.

^[4] Ken Alltucker Drug overdoses surged amid COVID lockdowns; more deaths in one year than ever before, USA TODAY (Nov. 17, 2021), https://www.usatoday.com/story/news/health/2021/11/17/overdose-deaths-soar-record-level-amid-pandemic-rise-fentanyl/8629870002.

^[5] Id.

^[6] Id.

^[7] Id.

^[8] People v. Purdue Pharma L.P., 2014 Cal. Super. LEXIS 24730 (Nov. 1. 2021).

^[9] Nate Raymond, California judge delivers drugmakers 1st trial win in opioid litigation, REUTERS (Nov. 2, 2021), https://www.reuters.com/world/us/california-judge-rules-drugmakers-major-opioid-lawsuit-2021-11-02.

^[10] Purdue Pharma L.P., 2014 Cal. Super. LEXIS 24730.

^[11] Raymond, supra note 9.

^[12] Id.

^[13] Purdue Pharma L.P., 2014 Cal. Super. LEXIS 24730.

^[14] Id.

^[15] Raymond, supra note 9.

Image Source: https://unsplash.com/s/photos/pill

By Drew Apperson

 

On June 14, 2021, the Commonwealth of Virginia’s State Corporation Commission (“SCC”) approved Phase IB of Dominion Energy’s (also known as Virginia Electric and Power Company, or VEPCO) plan for electric distribution grid transformation projects pursuant to § 56-585.1 A 6 of the Code of Virginia.[1] This is but one part of a grid overhaul plan by the Virginia-based utility company.[2] “The electric grid was originally designed for one-way flow of electricity to meet customers’ demand.”[3] In the traditional electric grid system, electricity is produced by a generator, such as a hydroelectric dam or nuclear power plant. Electricity then feeds through the transmission system to the distribution system, and finally, is made available to the end-use customer – the outlets in your home.[4] On the other hand, “smart grid” designs, like that of Dominion’s being considered by the SCC, allow for bidirectional electrical flows and alternative routes for the electricity to reach the consumers. [5]

With the growing number of not just personal electric cars, trucks, and SUVs, but also commercial fleets of electric vehicles, traditional grids are inadequate to utilize what are essentially drivable batteries. For example, when an area loses power from a downed electrical line during a storm, anything down-stream of the issue is isolated from the generator and is thus without power – a so called “voltage island.”[6] In a two-way electric grid, however, the batteries powering electric vehicles can serve as the generators. An electric vehicle can plug into the grid and provide temporary power to the isolated area until the electrical lines are repaired. [7]

Another added benefit of smart grids comes when there is no power outage. Transmitting electricity hundreds of miles from the generator incurs noticeable loss and loses efficiency as the distance to the consumer increases.[8] To overcome the issue in a traditional grid could require monumental investments, such as replacing the typical steel-aluminum construction of common transmission lines with precious metals, such as silver, gold, or copper.[9] However, plugging an electric vehicle back into the grid has the potential to reduce this inefficiency because the electrical source is closer to the end-user. Furthermore, this puts less demand on the infrastructure, especially during times of high overall power consumption.[10]

Understandably, consumers may not want to exploit their car’s battery packs given that discharges directly lower the effective life of a battery. Dominion is also in the process of addressing this with a solution that has its own independent benefits. “In 2019, [Dominion] announced an innovative electric school bus initiative to replace diesel school buses with electric school buses, and then leverage the batteries using vehicle-to-grid technology. Fifty electric school buses have been delivered to school districts throughout Virginia. The Company plan[ned] to begin evaluation and vehicle-to-grid testing this year.”[11]

Virginia’s “General Assembly accelerated its transition to a cleaner energy future with the passage of the VCEA in 2020. The VCEA calls for the development of a significant amounts . . . of small-scale [generation] resources that will interconnect to the distribution grid.”[12] The implementation of Dominion’s grid transformation plan is well underway to meet these developments, and Virginia’s SCC continues to keep a watchful eye over it.[13]

 

[1] Petition of Virginia Electric and Power Company, For approval of a plan for electric distribution grid transformation projects pursuant to § 56-585.1 A 6 of the Code of Virginia, and for approval of an addition to the terms and conditions applicable to electric service, Case No. PUR-2019-00154, Doc. Con. Cen. No. 218630055, Order Granting Motion (June 14, 2020), https://scc.virginia.gov/docketsearch/DOCS/532v01!.PDF.

[2] Grid Transformation Plan Phase II, Dominion Energy, Inc. (last visited Nov. 9, 2021), https://cdn-dominionenergy-prd-001.azureedge.net/-/media/pdfs/global/projects-and-facilities/electric-projects/grid/gt-plan-phase-ii.pdf?la=en&rev=0cd40dd1b5674ebf813de4f10d5e440d.

[3] Petition of Virginia Electric and Power Company, For approval of a plan for electric distribution grid transformation projects pursuant to § 56-585.1 A 6 of the Code of Virginia, Part 1 of 7 at 4, Case No. PUR-2021-00127, Doc. Con. Cen. No. 210640058, (June 21, 2021), https://scc.virginia.gov/docketsearch/DOCS/53v901!.PDF [hereinafter 2021 Petition].

[4] See id.

[5] Id at 35.

[6] Id at 22.

[7] See What is the Smart Grid, Department of Energy Office of Electricity (last visited Nov. 9, 2021), https://www.smartgrid.gov/the_smart_grid/index.html (defining “smart grids”).

[8] Jacques Schonek, How Big are Power Line Losses, Schneider Electric (Mar. 25, 2013), https://blog.se.com/energy-management-energy-efficiency/2013/03/25/how-big-are-power-line-losses/.

[9] See Kashyap Vyas, Electrical Energy and the Importance of Conductors, Interesting Engineering (Dec. 7, 2019), https://interestingengineering.com/electrical-energy-and-the-importance-of-conductors; Jennifer Sutton, How Do Electricity Transmission Lines Withstand a Lifetime of Exposure to the Elements?, MIT School of Engineering (Apr. 26, 2010), https://engineering.mit.edu/engage/ask-an-engineer/how-do-electricity-transmission-lines-withstand-a-lifetime-of-exposure-to-the-elements/.

[10] 2021 Petition, supra note 3, at 9–10.

[11] Id at 37.

[12] Id at 6.

[13] See Case Summary for Case Number: PUR-2021-00127, Virginia State Corporation Commission: Docket Search (last visited Nov. 10, 2021), https://www.scc.virginia.gov/docketsearch#caseDetails/142210.

Image Source: https://search.creativecommons.org/photos/9b52b449-2ea2-47d7-839f-96d9f8a61147

By Sebastian Estrada

 

Cryptocurrency has undoubtedly taken our world by storm. Notwithstanding its relatively new existence, “crypto” has surpassed a mere trend or fad. Many of us remember when Bitcoin was simply an urban legend, known as a “get rich quick” investment for a lucky few. Today, however, crypto is equivalent to any conventional currency, if not viewed as a more valuable alternative. Consequently, public interest in cryptocurrencies like Bitcoin or Ethereum continuously increases as major industries endeavor capitalize off the new tech.[1]

For years countries have attempted to regulate and mitigate cryptocurrencies. Nevertheless, one intrinsic feature of this new monetary power—often touted as its main benefit—is its regulatory impermeability.[2] In essence, blockchain technology has provided “the means to cut out the middlemen (banks and governments) in peer-to peer transactions.”[3] As such, cryptocurrencies have attracted intense attention from international coalitions, central banks, and economic regulators at the transnational level.[4] Today, the global legal and regulatory response could be characterized as fragmented with a patchwork of uncoordinated initiatives arising in varying jurisdictions.[5] In the US and Asian markets, legislative action is continuously developed. The EU, Australia, and Canada have shown potential to act as gateways between conventional currencies and cryptocurrencies, such as exchange platforms, to be declared subject to anti-money laundering and counter-terrorist financing requirements.[6] Other countries and regions of the world, however, either prohibit or heavily restrict cryptocurrency altogether.[7] The question becomes: how has cryptocurrency affected international trade and the globalized economy, and how has international law accounted for these changes?

The vague and muddled crypto regulations, policies, and enforcement jurisdictions throughout the world have forced governments to find ways to cooperate.[8] Specifically, world governments have been forced to establish mutually agreeable regulations that govern the use of cryptocurrency and give international jurisdiction for illicit activities.[9] For instance, the U.S., Australia, Canada, the United Kingdom, and the Netherlands, have come together to form the Joint Chiefs of Global Tax Enforcement.[10] Through this coalition, countries can share information to reduce the likelihood of organized criminals and tax evaders using new technology to manipulate the system and exploit vulnerable persons for their illegal gain.[11] Likewise, the European Parliament established the GDPR in 2018. It set forth regulations which addressed individual privacy concerns, and repealed and replaced the European Commission’s Data Protection Directive.[12] Under this framework, data-processors within blockchain related service providers would be affected by regulations due to the transnational nature of blockchains and cryptocurrency engagements.[13] However, it soon became clear that cryptocurrency was not compatible with the GDPR. Specifically, because decentralized blockchains do not rely on a central authority to process data, their third-party nature prevents cryptocurrencies from adhering to GDPR regulations.[14]

Cryptocurrencies non-compliance with the GDPR is only one of many obstacles faced by international regulation. Other obstacles stem from differing ideological principles regarding individual rights to privacy. The EU places emphasis on the individual rights to privacy because it is considered a fundamental right;[15] while the U.S., on the other hand, looks at personal data as property of the entity holding said data—making data transfer between different countries and their entities much more complex.[16] Accordingly, the inherent issues associated with cryptocurrency only intensify the need for international cohesion. Although the benefits associated with cryptocurrency may be significant, the downsides of crypto are likewise vast. These issues include using cryptocurrency to (i) illicit crimes, such as financing terrorism, and money laundering; (2) promote tax evasion; (iii) engage in market manipulation through fraud; etc. [17]

It is clear that the presence cryptocurrency is only continuing to expand. More and more cryptocurrencies are being generated, and more trading platforms are allowing for everyday investing into the crypto market. Consequently, the need for international collaboration on regulatory measures will only intensify. Cryptocurrency transcends boarders, and domestic regulators. Therefore, countries must look beyond their domestic laws and their varying ideological differences on data rights. These steps are crucial in order to catalyze a global coordination and harmonization of uniformed regulations in response to the proliferate expansion of cryptocurrency.

 

[1] Freeman Law, https://freemanlaw.com/legal-issues-surrounding-cryptocurrency (last visited Nov. 12, 2021).

[2] Michael Miglio, The Current And Future Implications Of Cryptocurrency For The Legal Industry, Forbes, (last updated Apr. 8, 2019), https://www.forbes.com/sites/theyec/2019/04/08/the-current-and-future-implications-of-cryptocurrency-for-the-legal-industry/?sh=22a9db4368f9.

[3] Id.

[4] Regulation of cryptocurrencies, Norton Rose Fulbright, https://www.nortonrosefulbright.com/en/knowledge/publications/b0264cac/a-global-legal-and-regulatory-guide-to-cryptocurrencies (last visited Nov. 12, 2021).

[5] Id.

[6] Id.

[7] Id.

[8] D. T. Morton, The Future of Cryptocurrency: An Unregulated Instrument in an Increasingly Regulated Clobal Economy, 16 Loy. U. Chi. Int’l L. Rev. 129, 131 (2020).

[9] Id. at 131.

[10] Id. at 141.

[11] Id. at 142.

[12] Id. at 139.

[13] Id.

[14] Id. at 140.

[15] Id. at 142.

[16] Id.

[17] Id. at 143.

By Jeffrey Phaup

 

In a scramble to survive the COVID-19 pandemic companies around the world embraced remote working, but this new arrangement blurred lines between working and personal hours.[1] However, newly remote employees suffered ‘availability creep’, a condition where workers feel obligated to be available at all times to respond to work requests from their employers.[2]

To promote a healthy work-life balance for workers and to prevent companies from overworking employees Portugal has passed a set of laws under which employers could face penalties for contacting workers outside of office hours.[3]

Under these laws, which apply to any company with 10 or more employees, an employer will face fines for contacting workers beyond their normal working hours.[4] Companies will also have to bear certain expenses incurred due to remote working, such as an employee’s increased internet and electricity bills. Employers cannot monitor their employees while they work remotely but that superiors and employees should meet in person every two months to avoid isolation.[5] Additionally, in jobs where remote work is possible, parents may choose to work remotely until their child is eight years old without making prior arrangements.[6]

Ana Mendes Godinho, Portugal’s minister of labor, said that this is a “crucial moment” to establish new rules and that the pandemic “accelerated the need to regulate what needs to be regulated.”[7] “The pandemic has accelerated the need to regulate what needs to be regulated,” she said. “Telework can be a ‘game changer’ if we profit from the advantages and reduce the disadvantages”.[8] Additionally, Minister Godinho asserted that building a healthy remote working culture could also bring other benefits to Portugal in the form of foreign remote workers who are seeking a change of scenery, “We consider Portugal one of the best places in the world for these digital nomads and remote workers to choose to live in, we want to attract them to Portugal.”[9]

 

[1] See generally Suzanne Elliott, Could it soon become illegal in the UK for your boss to contact you outside work hours?, ITV News (Nov. 12, 2021), https://www.itv.com/news/2021-11-12/could-your-boss-be-banned-from-contacting-you-outside-work-hours [https://perma.cc/82PY-ZKT2].

[2] Id.

[3] See generally Maite Fernández Simon, Portugal adopts strict pandemic-era labor protections for remote work, Washington Post (Nov. 11, 2021), https://www.washingtonpost.com/world/2021/11/11/portugal-working-from-home-law/ [https://perma.cc/3VB8-9N4V].

[4] Id.

[5] Id.

[6] Id.

[7] See generally Tom Bateman, Portugal makes it illegal for your boss to text you after work in ‘game changer’ remote work law, euronews (Nov. 11, 2021), https://www.euronews.com/next/2021/11/08/portugal-makes-it-illegal-for-your-boss-to-text-you-after-work [https://perma.cc/N9MH-R8HD].

[8] Id.

[9] Id.