Unconstitutionally Blocked: Southern District of N.Y. Rules President’s Twitter Practice Violates First Amendment

Written by Steven L. Foss

 

Background

On May 23, 2018, a federal district judge ruled that President Donald J. Trump’s blocking of Twitter users critical of him violates the First Amendment. Judge Naomi Reice Buchwald of the Southern District of New York, in a 75-page order on cross–motions for summary judgment, determined that the President’s Twitter handle @realDonaldTrump and the “interactive space” it generates constitutes a public forum under First Amendment jurisprudence. Consequently, when the President blocks someone from viewing and interacting with his profile, he commits unconstitutional viewpoint discrimination.

Knight Institute v. Trump

The controversy began when seven individuals who criticized President Trump on Twitter were blocked from the President’s @realDonaldTrump account. The Knight First Amendment Institute at Columbia University filed suit on behalf of the blocked individuals, claiming that the President used the blocking function to suppress political dissent in violation of their First Amendment rights. Judge Buchwald rejected the argument that the President’s personal First Amendment right of association outweighed the plaintiffs’ own First Amendment rights. And, while recognizing that there is generally no “right to be heard” by the government, Judge Buchwald distinguished that principle from the plaintiffs’ claims. She discussed the difference between Twitter’s blocking feature and its “muting” feature, whereby users can choose not to see the activity of a particular user. Unlike blocking, when user A is muted by user B, user A can still view, reply to, and retweet user B’s tweets, even though user B will not see these replies. Blocking users that the President does not wish to interact with is not functionally equivalent to muting them because the blocked users cannot reply to the President’s tweets and engage other users in dialogue concerning those tweets. The court noted that muting users that the President does not wish to engage with would serve the President’s own interests equally well while not infringing on the rights of individuals to speak to — but not necessarily be heard by — the government in a public forum.

Forum Analysis and Viewpoint Discrimination

In analyzing First Amendment claims, a preliminary question asks what type of forum the speech takes place in or is excluded from. The court in Knight Institute v. Trump determined that the President’s Twitter handle @realDonaldTrump and the “interactive space” created around it by virtue of Twitter’s features is a designated public forum for free speech purposes. Judge Buchwald rejected the argument that because the President once used the account as a private citizen, the handle is not a public forum. Rather, because the President chose to use the account in a manner similar to a traditional public forum, the handle must adhere to traditional First Amendment protections of subject matter and viewpoint neutrality.

In traditional and designated public fora, government regulations of speech must be “narrowly drawn to achieve a compelling state interest” in order to pass constitutional muster. While some subject matter and speaker restrictions can be constitutional under certain circumstances, viewpoint restrictions are generally considered to be forbidden. In the Knight Institute case, Judge Buchwald held that the blocking of users critical of President Trump was “indisputably” unconstitutional viewpoint discrimination, and went beyond merely choosing not to amplify the voices of those he disagrees with.

Declaratory or Injunctive Relief?

A more vexing problem for the court and those concerned with separation of powers was the type of remedy available to the plaintiffs. Citing multiple U.S. Supreme Court cases, Judge Buchwald rejected the government’s argument that a court “categorically lack[s]” authority to order the President to unblock Twitter users. However, the court did not grant the plaintiffs both declaratory and injunctive relief, as they had requested. It declared the President’s blocking unconstitutional and left open the possibility that if the President refused to unblock the plaintiffs, an action for injunctive relief could be brought to compel the President or his staff to unblock them. The Court held unblocking to be a purely “ministerial” action, involving little or no discretion (given the court’s ruling that blocking is unconstitutional, and the President’s general duty to comply with the law). Requiring such a ministerial action would be a “minimal” intrusion on the President’s inherent authority as chief executive. The court opined that even if it lacked the power to issue an injunction against the President, it could enjoin his social media director and co–defendant Dan Scavino, who also has access to the account.

Going Forward

In the wake of Knight Institute, it seems that government officials or entities operating social media accounts for official purposes must not restrict users from interaction based on viewpoint. There are similar lawsuits pending in other district courts, and they may take notice of Judge Buchwald’s ruling. They could also be critical of the expansion of First Amendment protections into cyberspace, heeding Justice Samuel Alito’s concurrence in Packingham v. North Carolina where he cautioned against Justice Kennedy’s broad language in striking down a law forbidding sex offenders from accessing vast swathes of the Internet. A federal district court in Kentucky denied a preliminary injunction preventing Governor Matt Bevin from blocking critics on social media, holding that the plaintiffs there were unlikely to succeed because they are simply not being heard by the government. The case is ongoing.

The Department of Justice disagrees with the Knight Institute decision and is reviewing its options, including appeal. We shall have to wait and see. In the meantime, given politicians’ increasing online presence and the growing recognition that public fora extend beyond traditional physical spaces like sidewalks and parks, public officials should exercise caution when deciding how to deal with dissent on social media.


Sources

Hargis v. Bevin, 2018 U.S. Dist. LEXIS 54428 (E.D. Ky. Mar. 30, 2018).

Issie Lapowsky & Louise Matsakis, Trump Can’t Block Critics on Twitter. What This Means For You, Wired (May 23, 2018, 6:29 P.M.).

John Herman & Charlie Savage, Trump’s Blocking of Twitter Users Is Unconstitutional, Judge Says, N.Y. Times, May 23, 2018.

Knight First Amendment Inst. at Columbia Univ. v. Trump, 2018 U.S. Dist. LEXIS 87432 (S.D.N.Y. May 23, 2018).

Packingham v. North Carolina, 137 S. Ct. 1730 (2017).

Press Release, Knight First Amendment Institute at Columbia University, Federal Court Rules that President Trump’s Blocking of Twitter Critics Violates First Amendment (May 23, 2018).

 

Photo courtesy of The Economist.

Gambling with Gamers: The Global Controversy Surrounding the Growth of Virtual Loot Boxes and Their Ties to Gambling

written by Nathan Jerauld

 

Background

In recent years, video game companies discovered a new way to generate profits: loot boxes. “Loot boxes” are randomized rewards that video game players receive in exchange for in-game points, which are earned by playing the game or by paying real-world cash. The rewards offered in loot boxes could be purely cosmetic, or could offer players powerful perks that improve their chances of winning games.

Globally, countries differ on whether loot boxes constitute gambling, and should be regulated accordingly. Earlier this year, the Netherlands outlawed loot boxes because of its association with gambling. Conversely, the United Kingdom concluded it was not gambling. Last month, however, Belgium became the second country to make loot boxes illegal, and required game publishers to remove loot boxes purchasable with cash. Despite the recent turn in Belgium, the CEO of Electronic Arts (EA), a major video game producer, stated early this month that they remain committed to including loot boxes with future game releases.

Ties to Gambling

Loot boxes bare some similarity to gambling, a practice illegal for minors in the United States. According to Black’s Law Dictionary, gambling is “[t]he act of risking something of value, especially money, for a chance to win a prize.” With regards to risking something of value, players must spend in-game currency, which requires them to invest time into gameplay, or use cash to purchase it.

Additionally, loot boxes do not guarantee good prizes. While players receive rewards for every loot box purchase, the most beneficial prizes are rare. In order to obtain the best prizes, players generally need to purchase numerous loot boxes. The hope of obtaining better loot drives players to spend more time or money to get more chances. Players report spending hundreds and thousands of dollars trying to get additional perks. In one notable case, a player spent over $13,000 USD as a minor in pursuit of in-game rewards.

Domestically, lawmakers have concerns about the relationship between loot boxes and gambling. To date, five states (California, Washington, Hawaii, Indiana, and Minnesota) have bills seeking to regulate the use of loot boxes in games marketed to minors. The Minnesota bill, for example, would prohibit the sale of video games with loot boxes to minors, and require publishers to include a clear warning to players that the game “contains a gambling-like mechanism that may promote the development of a gaming disorder . . . and may expose the user to significant financial risk.”

Despite growing concern about loot boxes and gambling, there are notable differences between the two. According to EA, loot boxes always provide the player some type of reward, and they also prohibit players from “cashing out” points for actual currency; the same cannot be said for gambling. Similarly, the Entertainment Software Association, a group representing video game publishers, compared loot boxes to popular, and legal, trading card games that require players to purchase card packs without knowing their contents.

The Way Forward

Video game publishers are unlikely to discontinue the use of loot boxes. Publishers earn about $30 billion dollars from loot box sales globally. In 2017, major video game publishers EA and Activision Blizzard earned over half of their revenues from digital sales, which include the purchase of loot boxes. In the next four years, global earnings from loot boxes are projected to increase to $50 billion dollars globally.

It is unclear if state efforts to regulate loot boxes will succeed. Traditionally, gambling is a state-level issue that falls within its police power. Yet, state bills addressing loot boxes are moving slowly, and hitting political snags. Hawaii’s bill originally attempted to impose regulations similar to Minnesota’s bill, but now would only require publication of the odds for winning loot. California’s bill has been effectively withdrawn. Indiana’s bill, introduced in January, calls for the State Attorney General to study the issue further; as of May, it is still in committee.

Adjusting U.S. policy on loot boxes could produce unintended consequences for other amusement industries. Currently, loot boxes are not regulated domestically. While the production, shipment, and use of video games with loot boxes would likely fall under interstate commerce, loot boxes seem more akin to unrestricted activities than restricted ones. Various activities marketed toward minors involve monetary risk, but do not fall under social conceptions of gambling. Consider popular trading card games like Magic: The Gathering, or other amusements like claw games, and carnival games that involve risking money for prizes. Although these activities have similarities to gambling, they are legal. If the government elects to regulate loot boxes, it is hard to see why it should not elect to regulate access to claw games, capsule vending machines, and Ring Toss.

Market factors will likely discourage predatory uses of loot boxes in the future. Boycotts have already been successful. Last year, EA made in-game payments and loot boxes an integral part of a major game, Star Wars Battlefront II. Players responded with highly negative criticism, and EA failed to meet its sales expectations for the game. Because of the response, EA altered the structure of the game. If players hold publishers accountable for loot box misuse, and refuse to pay, the industry will respond accordingly. Additionally, for younger players, increased awareness of the issue will help parents supervise their children’s use of loot boxes, and mitigate concerns of overspending.


Sources

Actions for Senate Bill 333, Ind. Gen. Assembly, https://iga.in.gov/legislative/2018/bills/senate/333#document-58bc9bc4. (last visited on May 18, 2018).

Call to Regulate Video Game Loot Boxes over Gambling Concerns, BBC (Nov. 24, 2017).

Dave Thier, EA: ‘Star Wars Battlefront 2’ Misses Sales Expectations, Forbes (Jan. 30, 2018, 5:27 PM).

Ellen McGrody, For Many Players, Lootboxes Are a Crisis That’s Already Here, Vice Waypoint (Jan. 30, 2018).

Ethan Gach, Meet the 19-Year-Old Who Spent over $17,000 on Microtransactions, Kotaku (Nov. 30, 2017).

Gambling, Black’s Law Dictionary (10th ed, 2014).

Gamers’ Anger Halts Star Wars Battlefront II’s Payments, BBC (Nov. 17, 2017).

HF 4460, 90th Leg., (Minn. 2018).

Jason M. Bailey, A Video Game Loot Box Offers Coveted Rewards, but Is It Gambling?, N.Y. Times, Apr. 24, 2018.

Matt Perez, Despite ‘Battlefront 2’ Flub, Electronic Arts Posts Record Annual Revenues of $5 Billion, Forbes (May 8, 2018, 7:20 PM).

Mike Wright, Video Gamers Will Be Spending $50 billion on ‘Gambling-Like’ Loot Box Features by 2022, According to Analysts, Telegraph, Apr. 17, 2018.

Nelson Rose & Rebecca Bolin, Game on for Internet Gambling: With Federal Approval, States Line up to Place Their Bets, 45 Conn. L. Rev. 653, 657 (2012).

Press Release, Entm’t Software Ass’n, Entertainment Software Association Commends California Assembly Member Bill Quirk (Apr. 17, 2018).

Rob Thubron, Over Half of Activision Blizzard’s $7.16 Billion Yearly Revenue Came from Microtransactions, Techspot (Feb. 12, 2018, 6:12 AM).

Tom Shea, EA Adamant Loot Boxes Aren’t Gambling, Gameindustry.biz (May 9, 2018).

Video Game Loot Boxes Declared Illegal Under Belgium Gambling Laws, BBC, Apr. 26, 2018.

A Brief Analysis of the Supreme Court’s Recent Decision on Sports Gambling

Written by Jacob Honan 

 

The United States has an undeniable attraction to betting on sports. Recent studies indicate that sports gamblers spend an astounding $105 billion annually through both legal and illegal means. On May 13, 2018, the United States Supreme Court issued their decision in Murphy v. NCAA, giving many gambling fans across the nation reason to celebrate. The primary takeaway from the Court’s 6–3 ruling is that all states are free to decide whether their citizens may gamble on professional sports, overturning prior law. As a result, some states have already implemented measures to make sports gambling widespread and accessible, while owners of professional sports teams are looking forward to seeing their revenue dramatically increase. The rationale for this decision—based on the right of states to be free from commandeering by the federal government—will likely shape other areas of constitutional law for years to come.

Background

 In 1992, Congress enacted the Professional and Amateur Sports Protection Act (“PASPA”), which forbid 46 states from authorizing any form of gambling on sports. This law was intended to protect the integrity of the professional leagues, as legislators feared that allowing such betting would “change the nature of sporting events from wholesome entertainment for all ages to devices for gambling.” Four states (most notably Nevada) were exempted from this regulation, and could allow sports gambling to varying degrees.

Controversy arose in 2012, when New Jersey Governor Chris Christie enacted a law that authorized gambling on professional sports within the state. The statute was in clear violation of PASPA and was prohibited from taking effect. The four major professional sports leagues (MLB, NFL, NHL, and NBA) and the NCAA sued New Jersey, arguing that this state law was invalid because it conflicted with PASPA. New Jersey was defeated in every lower court, but the Supreme Court granted certiorari and reviewed the case.

Murphy v. NCAA 

Surprisingly, the Court overturned every prior decision and ruled in favor of New Jersey, but the decision did not give any explicit endorsement of gambling. The majority of the Court, led by Justice Samuel Alito, relied on the anti-commandeering doctrine from the Tenth Amendment to the Constitution in making its decision. In essence, the anti-commandeering doctrine prohibits the federal government from “commandeering” state governments to implement certain laws. The Court held that PASPA violated the anti-commandeering doctrine because it prohibited states from allowing their citizens to bet on professional sports. While illustrating that PASPA imposes an unconstitutional infringement on state rights, Justice Alito stated that “[a] more direct affront to state sovereignty is not easy to imagine.”

The major sports leagues that sued the state of New Jersey argued that PASPA did not qualify as commandeering because the statute merely prohibited a state from legalizing sports wagering, and did not command any affirmative behavior. The Court rejected this claim, holding that the clear purpose of PASPA was to control activities within the states, which is a violation of the purpose of the Tenth Amendment. The Court also found no evidence that sports wagering qualifies as interstate commerce, which can generally be regulated by the federal government.

Finally, the court did not give explicit approval or disapproval to betting on professional sports, as its decision was based on constitutional concerns, not practical ones. Furthermore, the opinion allows for Congress to choose to ban or allow sports gambling altogether. However, Congress also has the option bypass the issue and let the individual states decide for themselves.

What Does the Court’s Decision Mean Going Forward?

Hypothetically, if Congress does decide to institute a nation-wide ban on betting on professional sports, it is plausible that the Supreme Court would uphold such a law. Experts have speculated that the Court would apply the strict scrutiny standard of review to this issue. A law subject to strict scrutiny will only be upheld if it is necessary to achieve a compelling government interest. If a suit challenging such a law is brought in the future, the government will likely defend a ban on sports gambling by using the same rhetoric as the enactors of PASPA—that ensuring the integrity of professional sports by prohibiting gambling qualifies as a compelling government interest. A challenger to this law would claim that there is no correlation between professional sports gambling and corruption within the leagues, and so a prohibition of gambling would not further the government’s interest. It remains to be seen whether Congress will prohibit sports wagering, but interesting lawsuits would undoubtedly result if they choose to do so.

In addition, the Court’s rationale in Murphy v. NCAA will likely impact claims brought against other laws that involve commandeering of states. For example, this decision appears to give significant ammunition to challengers of federal marijuana regulations, as they now have a credible argument that bans on the substance qualify as commandeering of state sovereignty. In addition, some cities have refused to follow recently-enacted federal immigration laws, and can use this ruling to claim that these laws pose a Tenth Amendment violation. Thus, the impact of this case could travel far beyond the casino, and will likely be relied upon in other areas of constitutional law for years to come.

Sources

Marc Edelman, Explaining the Supreme Court’s Recent Sports Betting Decision, Forbes (May 16, 2018).

Charles Star, Here’s What That Supreme Court Decision About Sports Betting Actually Does, Deadspin (May 15, 2018).

Sean Gregory, The Risks and Rewards of the Supreme Court’s Sports Gambling Decision, Time (May 18, 2018).

Amy Howe, Opinion Analysis: Justices strike down federal sports gambling law, SCOTUSBlog.com (May 14, 2018).

Michael McCann, Why New Jersey Won Its Supreme Court Battle to Legalize Sports Betting, Sports Illustrated (May 14, 2018).

Yancey Roy, What the Supreme Court’s Decision on sports betting actually means, Newsday (May 18, 2018).

Photos Courtesy of WKBW Buffalo & USA Today.

Maryland’s Effort to Control Skyrocketing Drug Prices Hits a Constitutional Snag

Written by Chris Baiamonte

 

Background

Dutch pharmaceutical giant Mylan un-serendipitously made headlines in 2016 when it raised the price of the life-saving injection device, EpiPen, to over $600.00 per unit, up from only around $50.00 per unit a few years prior. Unfortunately, this was merely one egregious example of the increasingly common phenomenon of skyrocketing drug prices. Long patent protections and inelastic demand allow pharmaceutical companies to routinely raise prices on essential medications by hundreds or thousands of percent. Examples of drugs costing hundreds per pill or tens of thousands for a course of treatment abound. The rarer the ailment, the less likely competitor generics are to enter the market and the more leverage the manufacturer has in raising prices.

A part of these eye-popping prices is a natural consequence of the ever-increasing difficulty of developing new drugs. Pharmaceutical companies spend billions of dollars developing thousands of compounds, in the hopes that a handful will lead to viable medications, of which one or two might pass the long and rigorous FDA approval process to reach the market. Nonetheless, these costs are all-but impossible for the average patient to keep up with, so most of the cost gets passed on to insurance providers, the largest of which is the U.S. taxpayer.

Attempted Solutions

Amid calls for regulation, Congress has been slow to react. Alternatively, state legislatures, motivated by the impact high drug prices have on state Medicaid budgets, have taken a more aggressive stance combating rising drug prices. New York, for instance, limits what state programs will pay out for drugs the state deems to be priced disproportionately high when compared to their medical benefit. In 2017, four states passed laws prohibiting third-party administers of prescription drug benefits from restricting pharmacists’ ability to inform customers about cheaper options for filling their prescription; an unfortunately common practice, known in the industry as a “gag rule.” California recently passed SB 17, a law requiring drug makers to disclose significant price increases ahead of time and make a public justification as to the need for the increase. Many other state measures of one kind or another have been enacted.

Maryland’s legislature passed one of the most ambitious solutions. HB 631 went into effect in October of 2017, over a veto from Governor Larry Hogan, who objected that the law was unconstitutional. HB 631 created a cause of action for the State Attorney General against generic drug makers who increased the price of any “essential” drug by 50 percent or more during a single year. However, an industry trade group representing the drug succeeded in having the law declared unconstitutional by a federal appellate court last week. In addition to setting back Maryland’s consumer protection efforts, the decision could be useful to other pharmaceutical industry groups in rolling back other state laws, including the one currently mounting a challenge to California SB 17.

Association for Accessible Medicines v. Frosh

After the District Court found in favor of Brian Frosh, Maryland’s Attorney General and the named defendant, plaintiff Association for Accessible Medicines (“AMA”) appealed to the Fourth Circuit Court of Appeals. On April 13th, a divided three-judge panel handed down its decision, agreeing with AMA that the law violated the dormant commerce clause’s extraterritoriality principle. The court described this principle as operating to prohibit state regulations which “’regulate[] the price of any out-of-state transaction, either by its express terms or by its inevitable effect.”’ The majority opinion found the broad scope of activities potentially affected by the Maryland law problematic. In relevant part, the law established a cause of action based on the price of the “initial sale” of any drug “made available for sale” in Maryland. As written, the law would implicate out of state transactions because, as Frosh’s counsel admitted at oral arguments, the ‘initial sale’ of nearly every drug sold in Maryland involves a manufacturer located outside the state, selling to a wholesaler, also located outside the state. For the majority, the regulation of these out of state transactions amounted to a regulation of out of state commerce, in violation of the dormant commerce clause.

The dissent decried the majority’s interpretation of the dormant commerce clause and questioned whether the extraterritoriality principle was even valid constitutional law. Its reasoning centered around the idea that the purpose of the dormant commerce clause is to check state laws which “discriminate against interstate commerce or favor[] in-state interests over out-of-state economic interests” and that this HB 631 accomplished neither. The dissent argued that absent these concerns, Maryland could regulate any “stream of commerce” that ends in Maryland.

What This Might Mean Going Forward

The significance of the decision, as well as the stark disagreement about the nature of the dormant commerce clause and the continuing vitality of the extraterritoriality principle, make the case a viable candidate for en banc review, where all the Fourth Circuit Court of Appeals judges would have a chance to weigh in, or potentially a grant of certiorari from the United States Supreme Court.

However, for the time being, the majority decision is law in the Fourth Circuit. If legislators in Maryland, North Carolina, South Carolina, Virginia, or West Virginia want to enact rules to counter the pernicious effects of runaway drug prices, they will have to proceed in a less zealous manner, or at least in a more circumspect one.


Sources

Ass’n. for Accessible Medicines v. Frosh, No. 17-2166, 2018 WL 1770978 (4th Cir. 2018)

Dana A. Elfin, Spiked Maryland Rx Pricing Law Could Kill Similar Efforts, Health Care on Bloomberg Law (April 16, 2018).

H.B. 631, 2017 Leg., 437th Sess. (Md. 2017).

Tara Parker-Pope & Rachel Rabkin Peachman, EpiPen Price Rise Sparks Concern for Allergy Sufferers, The New York Times (Aug. 22, 2016).

April Dembosky, California Governor Signs Law to Make Drug Pricing More Transparent, National Public Radio (Oct. 10, 2017).

Shefali Luthra, Federal Appeals Court Finds State’s Drug Price-Gouging Law Unconstitutional, National Public Radio (April 17, 2018).

Brad Kutner, Fourth Circuit Overturns Maryland Drug Pricing Law, Courthouse News Service (April 16, 2017).

Photo courtesy of The Washington Post.

 

When the Exception Swallows the Rule: The Chilling Effects of FOSTA

The views expressed in this article do not necessarily reflect those of the Legal Pulse Editor or the Syracuse Law Review.

 

Background

On April 11, 2017, President Donald J. Trump signed into law the bill known as FOSTA, the Fight Online Sex Trafficking Act. FOSTA received vast bipartisan support in both houses of Congress, and is intended to reduce illegal sex trafficking online.

FOSTA creates an exception to the “safe harbor” rule under Section 230 of the 1996 Communications Decency Act. Section 230 provides that: “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” As such, Section 230 has immunized platforms and Internet service providers (ISPs) from potential liability created by hosting user-generated content. However, FOSTA creates an exception to the “safe harbor” rule by exposing ISPs to civil and criminal liability for hosting content that enables illegal sex-trafficking.

Broad Language Could Lead to Unintended Consequences

Due to its broad and sweeping language, FOSTA poses two unintended threats: (1) the chilling of online free speech; and (2) the reduced security of sex-trafficking victims and consensual adult sex workers. As to the effect of chilling online free speech, numerous platforms have responded with attempts to proactively minimize their exposure to potential liability. In response to FOSTA, Craigslist removed its “personals” section, which allowed individuals to seek encounters with others. The closure was due to Craigslist’s fear of exposure to liability for its services being misused and, relatedly, the risk posed to its other services. This recent closure demonstrates that even where such ISPs do not themselves promote ads for prostitutes, the risk of liability in light of the burden of regulating such content necessitates the closure of such platforms. Thus, only those limited ISPs that have the requisite funds and resources would be able to implement the filters and censors necessary to be in compliance. Such compliance is not feasible for all ISPs, making it necessary to close certain platforms in whole or in part if such platforms could expose the ISP to liability. This would result in reduced competition between ISPs and, thus, threaten the vibrant online marketplace of ideas.

FOSTA may also result in reduced security and safety for both consensual adult sex workers and sex-trafficking victims. For example, Backpage.com is a website that provides an “online marketplace for sex workers.” It has provided a medium for which sex workers can communicate with each other and facilitate the provision of their services. While Backpage.com recently closed after its executives were named in a federal indictment, facing charges including money laundering and facilitating prostitution, advocates of consensual sex workers are fighting against the closure of the site and potential closure of other similar sites. These advocates argue that without a platform to communicate with one another, they are placed at a greater risk of violence. Moreover, due to the closure of Backpage.com and Craigslist’s “personals” section, sex-trafficking criminals will likely turn to encrypted or dark web forums instead in an effort to further their services while evading law enforcement review. As such, law enforcement could face greater difficulty in locating victims and prosecuting such perpetrators.

Going Forward

Although intended to combat illegal sex trafficking, FOSTA’s amendment to Section 230 results in an exception that swallows the rule. The marketplace of ideas is threatened as ISPs will either regulate or eliminate platforms that pose a risk of exposure to civil and criminal liability. Moreover, the unavailability of such platforms may force online sex trafficking further into the dark web, placing consensual adult sex workers at risk and removing victims and perpetrators from the reach of law enforcement. Thus, FOSTA may result in unintended consequences far beyond its intended effect.


Sources

47 U.S.C. § 230 (c)(1).

Amanda Arnold, Here’s What’s Wrong With the So-Called Anti-Sex Trafficking Bill, The CUT (Mar. 20, 2018).

Brian Feldman, Craigslist’s Legendary Personals Section Shuts Down, NYMAG (Mar. 23, 2018).

Charlie Savage & Timothy Williams, S. Seizes Backpage.com, a Site Accused of Enabling Prostitution, New York Times (April 7, 2018).

Elizabeth Nolan Brown, The New Law That Killed Craigslist’s Personals Could End the Web As We’ve Known It, The Daily Beast (Mar. 23, 2018).

Melissa Gira Grant, 7 Sex Workers on What it Means to Lose Backpage, The CUT (April 10, 2018).

Niraj Chokshi, Craigslist Drops Personal Ads Because of Sex Trafficking Bill, New York Times (Mar. 23, 2018).

Photo courtesy of Pexels.

The CLOUD Act’s Impact on Cross-Border Investigations

Written By Kristina Cervi

 

United States of America v. Microsoft Corporation

On December 4, 2013, in response to an application by federal law enforcement agents, Magistrate Judge James C. Francis of the Southern District of New York issued a search warrant that authorized the search and seizure of all e-mails and other information associated with an account believed to be furthering illegal drug trafficking. Under the §2703 warrant, Microsoft was compelled to disclose to the Government the contents of the specified e-mail account and all other records or information “[t]o the extent that the information . . . is within [Microsoft’s] possession, custody, or control.”

Microsoft’s Global Criminal Compliance team (“GCC”) produced the non-content information stored on servers in the United States. However, once the GCC determined that the target account’s data was hosted and stored in Dublin, Ireland, Microsoft filed a motion seeking to quash the warrant to the extent that it directed the production of information stored abroad. Microsoft cited the Stored Communications Act (“SCA”) and Rule 41 of the Federal Rules of Criminal Procedure (“Rule 41”) in their motion, claiming “[f]ederal courts are without the authority to issue warrants for the search and seizure of property outside the territorial limits of the United States.”

Judge Francis ultimately denied the motion which was later adopted by the District Court, and Microsoft was held in civil contempt for refusing to comply fully with the warrant. Microsoft appealed to a panel of the Court of Appeals for the Second Circuit contending the SCA and Rule 41 preempted the production of information stored overseas. The Government continued to argue that Microsoft had full control of the data and should be compelled to turn it over despite its overseas storage location. The Second Circuit reversed the denial of the motion to quash and vacated the civil contempt order, holding “that requiring Microsoft to disclose the electronic communications in question would be an unauthorized extraterritorial application of §2703” of the SCA as had been argued by Microsoft at the district level.

Tech Industry Takes It to The Hill

On October 16, 2017, the Supreme Court granted the United States’ Petition for Writ of Certiorari. As both parties prepared for their day before the highest court in the land, Microsoft sought creative solutions and spearheaded a lobbying effort on Capitol Hill. Joined by parties like Apple, Facebook, and Google that could also be implicated by warrants like the one at issue here, Microsoft drafted a letter to Congressional leadership on February 6, 2018. The letter encouraged members of both Houses to adopt the Clarifying Lawful Overseas Use of Data Act (“CLOUD Act”), a bipartisan bill that would amend the SCA and deliver “a logical solution for governing cross-border access to data” while also protecting customers and data holders with the law. The CLOUD Act essentially provided the legal answer to the question of law that parties argued over in front of the Court on February 27, 2018.

On March 23, 2018, Congress passed the $1.3 trillion Omnibus spending bill which included the CLOUD Act and President Trump signed the Consolidated Appropriations Act, 2018 into law. Under the CLOUD Act, companies must provide information properly requested by law enforcement, “regardless of whether such communication, record, or other information is located within or outside of the United States.” The CLOUD Act offers mechanisms for companies or the courts to reject or challenge the warrants, if the request violates the privacy rights of the foreign country storing the data, and if it does not overcome the muster of international comity which seeks to restrain the reach of domestic laws abroad.

Consequently, on April 17, 2018, the Supreme Court of the United States dismissed United States v. Microsoft Corp. on grounds of mootness, citing to the authority of the CLOUD Act. The Court explained that the Government had obtained a validly legal search warrant under the new version of §2703 and that no outstanding disputes remained.

What’s next for cross-border investigations?

The CLOUD Act ultimately provides clarity in a field of law that was in desperate need of an update. The Act preserves the common law right of cloud service providers to challenge search warrants where a conflict of laws exists and to evolve in the wake of the European Union’s new General Data Protection Regulations. Tech companies expect that Europe will consider the comity analysis requirements of the CLOUD Act and decide its own fate in terms of U.S. search warrants.

Further, the law will supplement Mutual Legal Assistance Treaties, which have become increasingly antiquated in the Digital Age. The law provides authority and a framework for the U.S. to establish international agreements. This framework only supports executive agreements with countries that protect privacy and human rights by mandating a broad and robust set of protections found enumerated in the U.S. Constitution. These include the rule of law and principles of nondiscrimination; lawful interference with privacy; fair trial rights; freedom of expression, association, and peaceful assembly; and prohibitions on arbitrary arrests and prohibitions or cruel and unusual punishment.

Overall, the CLOUD Act is a modern legislative action worthy of praise. Companies like Microsoft are able to preserve data privacy in the interest of their consumers through the outlined appellate process. Law enforcement has clarity in an area of law that was becoming increasingly vague, and the CLOUD Act will now streamline the global data exchanges commonly used in cross-border investigations of major crimes. Lastly, the international community will benefit from the enhanced privacy protections and the outlined executive agreement requirements that provide legal structure for the digital evidence gathering phases of criminal litigation.


Sources Cited

Devin Coldewey, Supreme Court dismisses warrant case against Microsoft after CLOUD Act renders it moot, TechCrunch (Apr. 17, 2018).

Taylor Hatmaker, As the CLOUD Act sneaks into the omnibus, big tech butts heads with privacy advocates, TechCrunch (Mar. 22, 2018).

In re Warrant to Search a Certain E-Mail Account Controlled and Maintained by Microsoft Corp., 15 F.Supp.3d 466 (S.D.N.Y. 2014).

In re Warrant to Search a Certain E-Mail Account Controlled and Maintained by Microsoft Corp., 829 F.3d 197 (2nd Cir. 2016).

United States v. Microsoft Corp., 584 U.S. ___ (2018).

2383, 115th Cong. (2018).

Dylan Matthews, Congress’s new $1.3 trillion omnibus spending bill, Vox (Mar. 23, 2018).

John Wagner and Mike DeBonis, Trump signs $1.3 trillion spending bill despite veto threat on Twitter, The Washington Post (Mar. 23, 2018).

Brad Smith, The CLOUD Act is an important step forward, but now more steps need to follow, Microsoft (Apr. 3, 2018).

Photo courtesy of FCW.

Taking a Gander at Partisan Gerrymander

Written By Kyle Palmore

 

Background

This term has seen a number of partisan redistricting cases come before the United States Supreme Court. So far, the Court has heard oral arguments for Gill v. Whitford and Benisek v. Lamone. Later this month, the Court will hear oral arguments for a third case concerning partisan gerrymandering: Abbott v. Perez. The decisions from these three cases have the potential to greatly impact the jurisprudence of partisan redistricting. The last time the Supreme Court spoke about partisan redistricting was in Vieth v. Jubelirer in 2004. In Vieth, the Court held that challenges to partisan gerrymanders were not in the purview of courts and were non-justiciable. As in many cases in the Supreme Court, Justice Anthony Kennedy was the swing vote. Justice Kennedy believed that a challenge to an extreme partisan map could have been justiciable if there was a clear standard for deciding when partisan redistricting becomes unconstitutional. As oral arguments for Abott near, the question remains whether Justice Kennedy will find if any of these cases present a clear standard for the Court to apply.

Gill v. Whitford

At the start of this term, the Supreme Court heard oral arguments for Gill v. Whitford, which involved challenges to Wisconsin’s voting districts under the First and Fourteenth Amendments. In 2016, the district maps made by the Republican-controlled legislature in 2011 were declared unconstitutional as partisan gerrymander. A three-judge panel in the United States District Court for the Western District of Wisconsin concluded that the maps showed “bad intent and bad effect” and that the map drawers used partisan measurements to ensure there was a Republican advantage.

During elections in 2012 and 2014, Democrats won a majority the votes in the statewide Assembly elections; however, Republicans took a majority of the seats in the state Assembly. For example, in 2012, Republicans made up only 48.6 percent of the vote, but gained 60 seats in the Assembly. Conversely, Democrats won 53 percent of the votes and only took 39 seats in the Assembly. Wisconsin Republicans argued that the maps reflected a natural geographic advantage.

When bringing this case before the Court, the plaintiffs argued that the state legislature diluted the Democratic vote by “cracking” and “packing” districts. The plaintiffs used the “efficiency gap” to make their argument. The efficiency gap shows the number of votes that are “wasted” during elections. Votes can be “wasted” in two ways. First, there can be more votes than needed in order for a candidate to win. Second, there can be too few votes to elect a candidate. The efficiency gap determines if a redistricting plan is biased against a party that “wasted” more votes than the other party. Positive values show an advantage for Democrats and negative values show an advantage for Republicans.

In the two aforementioned elections, the efficiency gaps were -13 and -10, respectively. These numbers identified a significant advantage for Republicans

Benisek v. Lamone

At the end of March, the Court heard a second case involving partisan gerrymandering, Benisek v. Lamone. In 2012, Roscoe Bartlett, a Republican, lost the congressional seat he held for 20 years by a 20 percent margin in Maryland’s 6th Congressional District. Previously, in 2010, Bartlett won that same seat by a 28 percent margin. Consequently, Republican voters in Maryland challenged the redrawing of the congressional district under the First Amendment.

Plaintiffs argued that the Democratic lawmakers in Maryland redrew the district in order to retaliate against those who supported Barlett and to dilute the Republican vote in the district. They further argued the district was redrawn to include more Democrats and to exclude Republicans. They argued that this violates the First Amendment as public officials may not retaliate against individuals for their expression. Here, lawmakers retaliated against voters that associated with a particular party when they redrew the district with the intent to dilute votes for the party not in power. Because of this intent, the Plaintiffs argued the new district map must be invalidated.

During oral arguments, Justice Kennedy expressed interest in the issue of a legislature drawing districts to favor the party currently in power. When the district in question was redrawn to accommodate for a population growth, lawmakers moved the district’s boundaries to include a very Democratic district. This change made the district more likely to vote Democrat than it had in the past. He asked whether this test would preclude legislatures from redrawing districts to account for a population shift that reduced support for a party. This question resembled one Justice Kennedy asked lawyers in Gill.

Abbott v. Perez

This month, the Supreme Court will again take on partisan redistricting via Abbott v. Texas. Abbott is the result of two Texas lawsuits, both named Abbott v. Perez, which centered around two maps—one for congressional districts and one for state legislative districts.

Starting in 2011, voters in Texas filed lawsuits alleging Texas violated both the U.S. Constitution and the Voting Rights Act. The lawsuits alleged that, between 2000 and 2010, Texas’ Republican-controlled legislature redrew congressional and legislative plans in order to dilute the vote of Latinos and African Americans, who made up 90 percent of Texas’ new population growth. Due to the growth, the state gained four new seats in the House of Representatives. In 2011, the Texas legislature redrew district maps to incorporate the new seats.

The newly redrawn district maps never went into effect. A three-judge panel in the United States District Court for the Western District of Texas blocked district maps prior to the 2012 election and created interim maps. The State appealed to the panel’s decision to the Supreme Court, which “threw out” the interim maps and told the State’s legislature to use the old district maps to draw new maps. In 2013, the Texas legislature adopted new maps, which were virtually the same to the maps it drew in 2011.

The maps, the 2011 district map and the newly adopted 2013 district maps, were once again taken to the district court. In August 2017, a three-judge panel in the United States District Court for the Western District of Texas invalidated two congressional districts. It found that one violated both the U.S. Constitution and the Voting Rights Act and that the other was drawn to minimize minority voting power and constituted impermissible racial gerrymandering. The panel also found that state legislative districts were intentionally packed and cracked districts in the Dallas-Fort Worth Area in order to dilute the minority vote. The most important holding for the panel was that the State’s districts were redrawn based on a “litigation strategy” as parts of the 2011 maps that were declared unconstitutional remained unconstitutional in the 2013 maps. The State did not redraw the maps to comply with the U.S. Constitution or the Voting Rights Act, but rather to shield the State from further legal challenges. The State was ordered, once again, to redraw the maps.

Shortly after the panel’s decision, Texas filed an appeal to the United States Supreme Court, asking for an injunction. The Court issued a temporary stay in response, and the consolidated cases will be argued on April 24, 2018.

Conclusion

Over the past six months, the Supreme Court has entertained a myriad of arguments concerning political redistricting. Of the nine Justices, only four were in the bench in 2004 when the court heard Vieth – Clarence Thomas, Ruth Bader Ginsburg, Stephen Breyer, and Kennedy. In Vieth, Justices Thomas and Kennedy voted with the majority; and Justices Breyer and Ginsburg joined the dissent. Nevertheless, the question remains: has the Court finally found a case that presents a clear standard that can be used in determining whether or not state legislatures have engaged in unconstitutional partisan gerrymandering? While the outcome of these cases is not clear, one thing is: Justice Kennedy remains the swing vote on this issue, and his vote could potentially change how partisan redistricting is viewed.

 


Sources Cited

Adam Liptak, Supreme Court, Again Weighing Map Warped by Politics, Shows no Consensus, N.Y. Times (Mar. 28, 2018).

Adam Liptak and Michael D. Shear, Kennedy’s Vote is in Play on Voting Maps Warped by Politics, N.Y. Times (Oct. 3, 2017).

Amy Howe, Argument Preview: Texas Redistricting Battles Return to the Court, SCOTUS Blog (Apr. 18, 2018).

Barry C. Burden, Everything You Need to Know About the Supreme Court’s Big Gerrymandering Case, Washington Post (Oct. 1, 2017).

Greg Stohr, U.S. Supreme Court Grapples with Partisan-Gerrymandering Lawsuits, Bloomberg (Mar. 28, 2018).

Mark Stern, Undecided Court, Slate (Mar. 28, 2018).

Robert Barnes, Even on Second Look, Supreme Court Seems Stumped on Gerrymandering Issue, Washington Post (Mar. 28, 2018).

The Supreme Court Takes on Two Redistricting Cases from Texas, Economist Blog (Jan. 15, 2018).

Photo courtesy of ExchangeWire.

There’s Something Brewing in your Coffee…But Do We All Need to Know?

Written By Amanda Cramer

 

California is relatively progressive when it comes to most issues. But has it gone too far? A judge in Los Angeles County Superior Court ruled that coffee must now carry a warning about a cancer-causing chemical simmering inside each cup. While such a decision may sound ominous, a look inside California’s mechanism for imposing such warnings proves that these cancer notices may be anything but.

Proposition 65

All over California, people cannot seem to escape warning signs in bold, capital letters of the risk of cancer, birth defects, or other reproductive harms from various products. This all began when California voters passed legislation called Proposition 65, formally known as the Safe Drinking Water and Toxic Enforcement Act of 1986. Under Proposition 65, the Office of Environmental Health Hazard Assessment compiles a list of chemicals, currently at nearly 900, that are known to cause cancer or birth defects. Businesses in California are then required to alert consumers if any of these chemicals are present on their premises. The law relies on citizen enforcement, and it allows anyone to sue. There is no injury requirement, and plaintiffs do not even need to have purchased the product that is the subject of the suit. Further, the law incentivizes private plaintiffs by allowing them, if successful, to share in any civil penalties awarded, in addition to entitling them to seek attorney’s fees.

Council for Education and Research on Toxics v. Starbucks Corp., et al.

In 2010, a not-for-profit group, the Council for Education and Research on Toxics, sued 90 coffee retailers, arguing that they were violating Proposition 65 by failing to warn consumers of a chemical in their coffee that could cause cancer. The chemical, acrylamide, forms naturally in some foods as they are cooked at high temperatures, and it has been found to cause cancer in mice in high doses. That danger has placed acrylamide on the Proposition 65 list of cancer causing chemicals.

The case was divided into phases, with the first phase of the trial covering “Defendants’ affirmative defenses of (1) ‘no significant risk level’; (2) First Amendment; and (3) federal preemption.” The court rejected the defendants’ arguments during this phase of the trial and, thus, the defendants moved on to phase two of the case, where a ruling was released on March 28, 2018.

In phase two, the defendants––who include Green Mountain Coffee Roasters Inc., the J.M. Smucker Company, Kraft Foods Global, and Starbucks, among others––argued that the levels of acrylamide in coffee should be considered safe and that the health benefits of coffee outweigh the risks of acrylamide. The defendants tried to prevail at trial by showing that, while their product may contain acrylamide, considerations of public health would support such an alternative risk level for exposure to the chemical, in addition to showing that this alternative level is supported by a quantitative risk assessment. They presented evidence from renowned experts, such as David Kessler, the former head of the U.S. Food and Drug Administration under both President Bush and President Clinton. Another expert, who performed a quantitative risk assessment of acrylamide, was also used. However, the court ultimately ruled that the “[d]efendants failed to satisfy their burden of proving by a preponderance of evidence that consumption of coffee confers a benefit to human health.”

The defendants are represented by lawyers from many of the nation’s largest law firms. The plaintiff is represented by a four-person firm. Ultimately, this was a David-and-Goliath battle, and David and his slingshot prevailed.

Burden of Proof 

The defendants’ loss might seem surprising, however, much of it may have to do with the high burden of proof they faced in this case. When a plaintiff brings suit under Proposition 65, he or she only needs to show that a chemical in a product sold by a defendant is listed as harmful under the law. The burden is then shifted to the defendant to prove that the chemical is present at such a low level that the product does not require a warning. Here, the defendants had to prove that acrylamide in coffee would not cause one or more cases of cancer for every 100,000 people exposed, over a period of 70 years.

Statistically, meeting this empirical burden was a near practical impossibility for the defendants. The lifetime risk of cancer is one in two; thus, of the theoretical 100,000 coffee drinkers exposed to acrylamide, roughly 50,000 of them would eventually develop cancer for a host of other reasons in 70 years. Therefore, proving that one of those 100,000 people would develop cancer specifically because of acrylamide, rather than family history, genetics, or any other carcinogenic exposures would require a 70-year long study carefully controlling all the exposures to everything on earth in more than 100,000 people. But experimenting with 100,000 people would still not be enough. It would require more than 85 billion participants to build up the statistical power to support a strong claim that acrylamide does not cause cancer in one or more people out of every 100,000. This would become the largest, longest, and costliest study in the history of biomedical research, by orders of magnitude.

Conclusion

While this may all seem daunting, it is important for manufacturers, distributors, and retailers outside of California to be aware. Proposition 65 allows a suit to be initiated against any company with more than 10 employees doing business in California. After a successful suit, not only would a warning be necessary for the product, but companies could also be required to pay penalties of “up to $2,500 ‘per day for each violation.’” This means that even small, New York companies, who have no similar law in their states, but that occasionally sell products to stores in California, should be aware of the listed chemicals under Proposition 65 in order to make their business decisions accordingly.

Although many businesses have been ‘steaming’ over the ruling, they are not the only ones feeling the impact. When cancer notices are brewing everywhere, from indoor garages to the Disneyland Resort to any place that serves alcohol, this may quickly diminish the purpose of the law and make customers overlook such warnings.

 

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Sources Cited

Alexander Nazaryan, Will coffee in California come with a cancer warning?, Los Angeles Times (Feb. 18, 2018).

Brendan Borrell, Are Proposition 65 warnings healthful or hurtful?, Los Angeles Times (Nov. 2, 2009).

California coffee may soon come with a cancer warning, but should consumers worry?, CBS News (Feb. 8, 2018).

Council for Educ. and Research on Toxics v. Starbucks Corp., et al., No. BC435759, (Super. Ct. Cal. Mar. 28, 2018).

David Spiegelhalter, Coffee and cancer: what Starbucks might have argued, University of Cambridge: Winton Centre for Risk and Evidence Communication (Apr. 2, 2018).

Jenna Greene, Daily Dicta: Bitter Brew: What Went Wrong in California’s Coffee Lawsuit, The American Lawyer: Litigation Daily (Apr. 2, 2018).

Nate Raymond, Starbucks coffee in California must have cancer warning, judge says, Reuters (Mar. 29, 2018).

Norman C. Hile, et al., Beware Calif.’s Proposition 65, Law 360 (Jul. 19, 2011).

State of Cal. E.P.A. Office of Envtl. Health Hazard Assessment Safe Drinking Water And Toxic Enforcement Act Of 1986, Chemicals Known to the State to Cause Cancer or Reproductive Toxicity (Dec. 29, 2017).

Photo courtesy of CNN.

Detained Immigrant Minors Guaranteed Access to Abortions


Facebook Faced with Data Breach Controversy  

Written By Amy Johnson

 

The New York Times recently revealed that Cambridge Analytica, a data analysis firm based in London, was hired by the Trump Campaign to “harvest private information from the Facebook profiles of more than 50 million users without their permission.” Facebook has faced growing backlash since the information was revealed – their stocks have been dropping, Chief Security Officer Alex Stamos has stepped down, Chief Executive Officer Mark Zuckerberg is expected to brief congressional committees, and as of March 21, 2018, both Facebook and Cambridge Analytica have been sued in the United States District Court for the Northern District of California. Mark Zuckerberg called the scandal “a major breach of trust” during a recent interview with CNN.

What did Facebook and Cambridge Analytica do?

Cambridge is a company owned by billionaire Robert Mercer. Steve Bannon, a former Trump adviser, is alleged to have presided over a project with Cambridge Analytica in which information was obtained to construct and analyze voter profiles. The company worked with the Trump Campaign team to compile millions of United States Facebook users’ profiles to build a program to predict and influence voter choices. This data was obtained through Aleksandr Kogan, a Cambridge University researcher, who created a personality quiz for users to take on Facebook. Once a user linked into the quiz, Kogan was able to access the user’s page and data. Through several hundred thousand quiz takers, Kogan was able to access more than 50 million Facebook users’ profiles, later targeting them with personally-tailored political advertisements. In other words, if a user took the quiz, he or she (and thousands of Facebook friends’ ‘likes’ and ‘dislikes’) were accessible.

Kogan’s access to this data was known to Facebook and was consistent with Facebook’s developer application program interface (“API”). The Facebook developer page shows that their application program creator allows developers of apps to not only get user’s account information, but to access information like “friends_interests” and “friends_religion_politics.” However, Facebook’s policy only allowed for the collection of friends’ data for the purpose of improving user experience in the app – not for sale or advertising uses. This “unprecedented data harvesting” of millions of Facebook users’ information by Cambridge Analytica, and more specifically, the use of that data, raises many new questions about Facebook’s role in targeting United States voters in the past election.

In the midst of the reveal of the Cambridge Analytica breach, President Donald J. Trump took to Twitter to discuss his campaign’s success in utilizing social media during his campaign. He tweeted, “Remember when they were saying, during the campaign, that Donald Trump is giving great speeches and drawing big crowds, but he is spending much less money and not using social media as well as Crooked Hillary’s large and highly sophisticated staff. Well, not saying that anymore!”

What Laws Might Apply to Facebook and Cambridge Analytica?

With one lawsuit filed, and a potential for more filings in the future, there are several ways that Facebook users and Facebook could proceed to court.

(1) Computer Fraud and Abuse Act (CFAA)

The CFAA provides criminal and civil penalties for unauthorized access to computer networks. However, the statute itself focuses on the “authorization” of the “accesser” which, technically, Kogan had. The quiz created required voluntary action on part of the user in taking the quiz, which notified the user of access to their user profiles. In a recent Ninth Circuit decision, the Court stated “a defendant can run afoul of the CFAA when he or she has no permission to access a computer” when the permission granted “has been revoked explicitly.” However, the Court did not say that ‘overstaying one’s welcome’ was a violation of the CFAA. Here, Kogan had authorization to the Facebook profiles and that authorization was not revoked during his access. He may have done more than “welcome,” but it will be up to the courts to determine whether or not this constitutes a violation.

The CFAA also punishes users who exceed authorized access, which could be where Kogan is deemed to be in violation. However, the language in the statute states that exceeding authorized access is accessing “a computer with authorization and to use such access to obtain or alter information in the computer that the accesser is not entitled to.” When Kogan created the quiz, he obtained access to information in a way allowed by Facebook’s API; yet, when that information was subsequently used beyond what Facebook allows, it lent itself to a possible violation of the CFAA.

(2) Federal Trade Commission (FTC) Rules

Bloomberg recently reported that the FTC is also investigating whether Facebook violated the terms of the 2011 consent decree between the social media site and the FTC. The decree provided that Facebook needs to be transparent about user privacy and to not deceive its users as to how their data will be used. If a court finds that Facebook violated this policy, the penalty could be up to $40,000 per day per violation. Lawmakers have also asked the FTC to look into whether Facebook should pay damages to individual users. The FTC said in a statement that “it takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook.” A group of 37 attorneys have sent a letter to Mark Zuckerberg for details on Facebook’s privacy safeguards.

(3) Securities Law

Securities law encourages companies to “disclose material information promptly, including disclosures pertaining to cybersecurity matters.” Facebook’s 2014 and 2015 reports have no mention of the Cambridge Analytica incident, and the site, as a whole, mentions data breach as a risk but never discloses if any breaches took place. Moreover, Facebook never reported this incident to investors or to the Securities Exchange Commission (SEC). It remains to be seen whether the SEC will pursue action against Facebook, along with the potential forthcoming actions of the FTC and individual users.

What’s Next?

Moving forward, users can expect to see hearings, lawsuits, potential jail time, and in general terms, what has been described by some as a regulatory nightmare. For Facebook, pinning this breach on Kogan and Cambridge may be key. If not, users may observe the downfall of the social media tycoon.

 


Sources Cited

Andrew Keane Woods, The Cambridge Analytica-Facebook Debacle: A Legal Primer, Lawfare (March 20, 2018).

Carole Cadwalladr, Emma Graham-Harrison, Revealed: 50 million Facebook profiles harvested for Cambridge Analytica in major data breach, The Guardian (March 17, 2018).

Facebook, Inc., v. Power Ventures, Inc., 844 F.3d 1058, 1067 (9th Cir. 2016).

Computer Fraud & Abuse Act, 18 U.S.C.A. § 1001, Pub. L. 99-474 (1986).

Tiffany Hsu & Cecilia Kang, Facebook Comes Under Scrutiny of Federal Trade Commission, New York Times (March 26, 2018).

Eric Auchard, Jonathan Stempel, Facebook, Cambridge Analytica sued in U.S. by users over data harvesting, Reuters (March 21, 2018).

Dustin Volz, David Shepardson, Munsif Vengattil, Facebook investors fret over costs as Zuckerberg apologizes, Reuters (March 22, 2018).

Photo courtesy of New York Post.