Archive for November 2012

When can police search a cell phone?

leave a comment

How does the Fourth Amendment apply to the contents of technological devices, particularly in the context of inventory searches pursuant to a lawful arrest? In March 2012, headlines such as "Police can now search cell phones without warrant" warned Americans of the possibility of police committing severe violations of privacy by searching our cell phones, which contain troves of personal information, without a warrant. However, famed 7th Circuit Judge Richard Posner wrote the opinion referenced in that headline, which only went so far as to hold that searching a cell phone seized at the time of arrest for that cell phone’s number in order to subpoena the phone records for that particular phone does not violate current Fourth Amendment jurisprudence as a valid warrantless search incident to arrest. The Supreme Court upheld inventory searches incident to arrest in Illinois v. Lafayette. Although these were initially meant as administrative searches to take inventory of physical articles on a person at the time of incarceration pursuant to arrest, technological advances now allow people to store various forms of important information in their phones and other personal technological devices, many times in the form of messages and “apps.” Further, these devices are likely to be on the person at the time of arrest. Therefore, the physical technological devices are subject to inventory searches. But what about the content and data contained on the devices and the apps? As technology advances, what is the constitutionality of an inventory search of the contents of a phone or other personal technological device, such as a tablet, at the time of incarceration, pursuant to a lawful arrest? While this type of inventory search would serve to protect the police and government from civil suits if a criminal defendant claimed an app or message was missing after he was incarcerated, it would also deeply infringe on the privacy of that incarcerated individual. Apps and messages would give the police broad insight into the interests, activities, locations, and acquaintances of the criminal defendant. This is a major violation of privacy, and the incarcerated individual’s interest in maintaining that privacy and Fourth Amendment protection against that type of search would probably outweigh the benefits of protecting the police from a claim arising out of a missing app or message. Further, searching the apps and messages of a personal device would also consume tremendous resources that most police stations and government budgets could not accommodate. Although it seems that the disadvantages of allowing police to conduct an inventory search of the contents of a personal technological device such as a phone or a tablet would outweigh the advantages, this warrantless search pursuant to a lawful arrest would provide police with important evidence of criminal activity of the defendant and his accomplices. As people, including criminal defendants, continue to store more of their personal information on personal technological devices that are likely to be on their person at the time of arrest and incarceration, legal issues relating to the content of those devices will continue to arise, and courts will need to balance the Constitutional liberties of individual defendants against the government's interest in investigating crimes and protecting public safety.  

Written by

November 26th, 2012 at 10:59 am

Posted in Commentary

Old Regulations, New Technology

leave a comment

California’s Bay Area is moving towards a new means of transportation, but not if the state government can have its way. SideCar is a San Francisco-based startup that offers real-time ridesharing to a community of smartphone users who need transportation throughout the city. The obvious goal of the business is to transport users around the city quickly and at a lower rate than alternatives, but it also has added social benefits. The SideCar community is comprised of independent drivers who use their own vehicles to give rides to unknown users who place requests using an iOS or Android app. Extensive background checks are performed on each driver and SideCar ensures that each driver has a good driving history, a license, and is insured. SideCar also handles payments to the drivers, which are optional donations: a practice the startup thought would help avoid legal issues. To many this seems like an innovative way to travel locally in a community that increasingly relies on technology, but the California government thinks differently. The California Public Utilities Commission (CPUC), backed by taxi driver lobbyists, characterizes SideCar as a car service and claims it does not have the proper permits or authority to operate such a service. CPUC served the company (and other ride-share startups) with a cease-and-desist letter and a $20k fine for operating a car service illegally. However, Sidecar maintains that it is not a car service. The company only provides the communication resources to permit community members to arrange their own car service and therefore does not need the permits and authority necessary to operate a car service. SideCar compares categorizing the service it provides as a car service to labeling Airbnb as a hotel chain, Travelocity as an airline, or Ebay as a store. Despite threats from CPUC, eager investors have not been deterred from providing more than $10 million in funding to the startup. SideCar plans to use the capital to expand outside the Bay Area and double the size of its staff (currently, SideCar has 20 employees). The California government faces the common challenge of trying to fit new technology (ride-share startups like SideCar) into existing regulations. CPUC traditionally regulates privately owned electric, telecommunications, water, transit, and passenger transportation companies. Do ride-share startups fit into this class or do they require new regulations? California has an interest in regulating new businesses, but must do so without sacrificing innovation. Legislatures and courts across the country have struggled to extend existing law to cover new developments in technology over the last few decades. Just as the taxi drivers in San Francisco feel threatened by ride-share startups, telephone companies once unsuccessfully tried to ward off Internet telephony in its infancy. Sometimes it is necessary to create new regulations since the old ones simply were not designed with such drastic changes in technology in mind. • http://blog.side.cr/

Written by

November 21st, 2012 at 10:42 am

Posted in Commentary

YouTube Updates its Content ID Dispute Process, but is it Enough?

leave a comment

On October 3, 2012, YouTube announced a change in its content ID dispute process, as updated on its blog. What does this update really mean and why does it matter? A short story might help clarify the situation. Last spring, long before I enrolled to take Copyright, I received a panicked phone call from my mother, who had in turn received an e-mail from YouTube notifying her that she had violated the copyright policy of the website.  Turns out that my mom uploaded a video of my dogs dancing and playing to some music on the radio. The video had approximately three viewers (myself included), yet somehow, someone, somewhere claimed that the music playing on the radio in the background was copyright protected and that my mother was infringing on that right.  Who was policing the matter? What could my mom do in response? Was she really in trouble? I had no idea what the answers to any of these questions were, and needless to say, neither did my mom. So the video went away. This semester, I am taking Copyright and when the topic came up in class I was eager to tell my mom’s story and find out what on earth was going on. It just so happens that the day I decided to ask about my mom’s unfortunate YouTube experience in class was the same day YouTube reformed its content ID dispute process. As it turns out, YouTube’s content ID dispute process had been causing problems for quite some time, prompting many users to call for a change in YouTube’s policy. The old process worked as follows: a user posted a video, a copyright owner filed a claim, the user could then dispute the claim, but it went immediately back to the party claiming copyright infringement. The party claiming copyright can then either reinstate the claim, or release it. If the copyright claimant did not release the claim then the user had no further recourse. This process resulted in numerous false copyright claims, clearly abusing the system and harming users. Some recent examples include YouTube taking down the Democratic National Convention live stream in September and blocking the NASA recording of the Mars landing in August because of improper copyright claims. So what did YouTube change on October 3rd? YouTube’s blog states, “Content owners have uploaded more than ten million reference files to the Content ID system. At that scale, mistakes can and do happen. To address this, we’ve improved the algorithms that identify potentially invalid claims. We stop these claims from automatically affecting user videos and place them in a queue to be manually reviewed. This process prevents disputes that arise when content not owned by a partner inadvertently turns up in a reference file.” Further, YouTube introduced a new appeals process, which now gives users a new choice when handling a dispute. Now, when a user appeals, the content owner can either release the claim or file a formal DMCA copyright notification. This is significant because there are actual legal consequences for filing false DMCA takedown requests. There appears to be significant support for YouTube’s policy change, but there is still some skepticism. Timothy Lee from Ars Technica states that the change is “clearly an improvement,” but “still leave[s] a lot to be desired.” Patrick McKay from Fairusetube.org told Ars Technica that he is “cautiously optimistic” about the improvements. He elaborates: “it looks like they have finally made the exact change I and other critics of the content ID dispute process have been calling for them to make.” McKay adds, however, that he regrets that it took YouTube so long to realize that “allowing copyright claimants to reinstate their own claims was a problem.” Whether or not the policy change will make a true difference is yet to be seen, but in the very least YouTube is addressing the content ID dispute problem and taking steps in the right direction to correct it.

Written by

November 14th, 2012 at 9:28 am

Posted in Commentary

Tagged with ,

Are Your E-mail Communications Protected by the Stored Communications Act?

leave a comment

Last month, the Supreme Court of South Carolina ruled that the Stored Communications Act (“SCA”) did not protect e-mails contained in a user’s webmail account. Jennings v. Jennings, No. 27177 2012 WL 4808545 (S.C. Oct. 10, 2012). The e-mail user sued his wife and her relative for violating the SCA by accessing his Yahoo! account to obtain e-mails he exchanged with another woman. The SCA was enacted in 1986 as part of the Electronic Communications Privacy Act and provides protection to electronic communication service providers and users by limiting when the government can compel disclosure of certain communications, limiting when service providers can voluntarily disclose information, and providing a cause of action against a person that intentionally obtains an “electronic communication while in electronic storage” without authorization. 18 U.S.C. § 2701(a)(2) (2000). Due to outdated definitions, the SCA affords little protection to internet communications exchanged today. An electronic communication service is a service providing “electronic storage,” which is defined as “(A) any temporary intermediate storage of a wire or electronic communication incidental to the electronic transmission thereof; and (B) any storage of such communication by an electronic communication service for purposes of backup protection of such communication.” 18 U.S.C. § 2510(17) (2000). This definition of electronic storage tracked the way e-mail was used at the time the SCA was enacted; mail was temporarily copied and stored before being downloaded to the recipient’s computer. Today, webmail services allow the user to access mail on the web through any computer rather than require the user to download the mail onto their personal computer, which raises the question of whether webmail is ever in temporary intermediate storage or stored solely for backup protection. The Department of Justice (“DOJ”) has adopted a narrow interpretation of “electronic storage.” According to the DOJ, a communication is not electronic storage under §2510(17)(A) unless it is stored in the course of transmission, and communications stored as backup protection under § 2510(17)(B) are those that are stored by the service provider as a backup copy prior to delivery to the recipient. CCIPS, U.S. Dep’t of Justice, Searching and Seizing Computers and Obtaining Electronic Evidence in Criminal Investigations, 123 (3d ed. 2009). Conversely, in Theofel v. Farey-Jones, the Ninth Circuit found that e-mail read by the recipient but still available on the server was stored for the purpose of “backup protection” and thus protected by the SCA under § 2510(17)(B). 359 F.3d 1066 (9th Cir. 2004). In Jennings, a lower court relied on Theofel in determining that the e-mails were in electronic storage “for purposes of backup protection.” The Supreme Court reversed, holding that the “passive inaction” involved in opening e-mail and leaving the single copy on the server cannot constitute storage for backup protection. Based on this holding, it is unclear whether any web-based e-mail communication would be protected under the SCA. Although the question of whether the e-mail could be protected under §2510(A) (“temporary intermediate storage of a wire or electronic communication”) was not raised in Jennings, it is unlikely that any opened e-mail could be said to be “intermediate storage.” The SCA’s outdated definitions are difficult to apply to electronic communications as they are used today and therefore do not adequately protect web-based communications.

Written by

November 12th, 2012 at 8:24 am

Posted in Commentary

Tagged with , ,

Equity-based Crowd-funding

leave a comment

While the internet may have developed uses beyond its singular purpose described in Avenue Q, using it to fund new ideas and start-up companies remains a difficult process. With the recent passage of the Jumpstart Our Business Start-ups (JOBS) Act in April, obtaining funding from the internet may soon become a little easier for companies, and potentially more profitable for investors. As any individual with a mind towards entrepreneurship quickly realizes, one of the biggest hurdles for new companies is successfully obtaining funds for their endeavors. Obtaining investment from venture capital, the traditional wellspring for new technology companies, is competitive and difficult. Moreover, many start-up companies are not suitable for venture capital investment, which tend to gravitate towards high impact and growth companies. In recent years, crowd-funding has often been proposed as a solution for this problem. Taking the opposite approach to venture capital, crowd-funding essentially gathers small amounts of money from a large number of people, usually through internet crowd-funding portals such as KickStarter. Proponents of crowd-funding argue that it will significantly increase capital availability for start-up companies, and provide a source of investment for low-profit social entrepreneurs who cannot attract venture financing. Not surprisingly, like most proposals to solicit money over the internet, federal laws step in to limit the utility of crowd-funding. Prior to the JOBS Act, the Securities and Exchange Commission required any issuer of securities with 500 or more equity security holders who are not accredited investors to register its securities with the SEC. Most start-up companies do not have the resources or sophistication to comply with SEC requirements, and as such, crowd-funding investors are generally not given equity in the start-up companies. Rather, the rewards for those who invest through sites such as Kickstarter are limited to small perks, such as receiving products as tokens of appreciation. The regulatory landscape for crowd-funding changed dramatically with the passage of the JOBS act. While the act deregulates many aspects of security law with the aim of reducing compliance costs for start-up companies, its treatment of crowd-funding deserves special attention. Under the JOBS Act, Crowd-funding investors no longer count toward the threshold number of investors that triggers compliance with disclosure requirements, provided that the aggregate amount raised through crowed-funding is no more than 1 million dollars, and the amount contributed by any investor in one year does not exceed thresholds based on the investor's annual income. Additionally, only companies listed on registered crowd-funding portals are permitted to issue equity. The SEC has yet to promulgate regulations on this portion of the law, so stay tuned for details. Criticisms of equity-based crowd-funding generally center on investor protection. Mandatory disclosures, despite being prohibitively expensive, are designed to give investors the facts they need to make informed decisions. In a study cited by the New York Times, Ethan Mollick of Wharton School of Business found that 75% of products launched through crowd-funding were delivered later than expected, with many projects never getting off the ground. Without mandatory disclosures, the information asymmetry between investors and managers makes it difficult, if not impossible, for crowd-fund investors to accurately assess investment quality. Moreover, many individual investors do not appreciate potential tax consequences of their investments or the length of time that their equity stake will remain illiquid. While crowd-fund investors will almost certainly experience a higher risk of financial loss, the potential for harm is likely mitigated by the limits on individual investments. A more salient point is that, to the extent the JOBS Act was designed to boost IPOs and business growth, the focus on crowd-funding may be misguided. By contributing their experience and expertise, traditional venture capital firms bring significant non-monetary value to the companies they fund. While crowd-funded companies may successfully raise capital, a large pool of small investors cannot offer the business acumen and connections provided by traditional investors. Nonetheless, some companies, especially low-profit social ventures, may find that crowd-funding is a viable means to raise capital while maintaining the independence they need to pursue social goals. The impact of de-regulating crowd-funding remains to be seen, and it is still unclear how many crowd-funding sites are actually prepared to jump through regulatory hoops to meet registration requirements under the act. Regardless, investors and entrepreneurs alike should keep their eyes trained on the potential of an equity-based crowd-funding model, and be vary of its pitfalls for both investors and entrepreneurs.

Written by

November 12th, 2012 at 8:09 am

Gaming Mods and Copyright

leave a comment

As computer and video gaming has grown from a niche market into a multi-billion dollar industry, gaming modifications, or "mods," have grown in scope and use as well. Mods have become as communal and omnipresent as the increasingly networked and social games upon which they are based. While mods once limited themselves to peripheral or purely aesthetic ends (such as Aliens TC, a mod which reworked the first person shooter Doom into a world based on the Aliens franchise), today's mods are involved and extensive. Some recreate and revamp old games in newer, flashier graphics engines (as in the Black Mesa mod, recreating the 1998 game Half-Life in painstaking detail), while others add impressively detailed functionality to pre-existing game and physics systems (like Industrial-Craft, a mod for the construction and exploration game Minecraft, which allows for development of industries as varied as oil refining to nuclear engineering). By and large the modding community has met with acceptance, if not outright approval, from the game developers whose intellectual property and products are altered. Some modifications have enjoyed such popularity that they have earned their developers jobs within the gaming industry (as in Counter-strike, a Half-Life mod which became an immensely popular game in its own right, and Defense of the Ancients, once a Warcraft III mod, now one of the most-played multiplayer games in existence.). However, as mods become more extensive, involved, and lucrative, they are increasingly running into legal issues, revolving mostly around violations of End User License Agreements (which by and large everyone accepts, but no one ever reads), and copyright infringement. Copyright infringement is obvious where mods substantially copy other intellectual properties, as in the Aliens TC mod, or alter or add to gameplay elements or stories. See Micro Star v. FormGen Inc., 154 F.3d 1107 (9th Cir. 1998) which ruled that sale of user-created map mods for Duke Nukem 3d constituted copyright infringement. While there are arguments to be made for fair use defenses or definitions of mods as derivative works, mods exist in a consistently shifting legal grey area, subject to the vagaries of developer whimsy. Early litigation involving modifications to online gaming treated copyright infringement as something to be assumed, not proved. MDY Industries, LLC v. Blizzard Entertainment, Inc., 616 F.Supp.2d 958, 970 (D. Ariz. Loc. R. 2009) found that a modification allowing automated actions by player characters in Blizzard's multiplayer online role-playing game World of Warcraft infringed Blizzard's copyright in the game. The court based its finding of infringement largely on the holding of MAI Systems Corp. v. Peak Computer, Inc., 911 F.2d 511 (9th Cir. 1993) which that the copying of a computer program into RAM constituted infringement. The application of MAI Systems to modification litigation essentially makes all modifications infringements of copyright, as they are code-based adjustments to an existing computer program that are stored both in RAM and in a fixed form (the programming language itself). This means that mods are "legal" only insofar as game developers suffer them to be so; the moment a developer finds a mod distasteful, it can be found to infringe copyright. Mods, no matter how well-respected or validated by developers, can also be found to infringe copyright through statute.  Blizzard Entertainment, Inc., v. Reeves, 2010 WL 4054095 (C.D. Cal. 2010) originated as an action against the defendant for infringement of Blizzard's copyright through violation of  World of Warcraft's monthly fee structure. Reeves and her compatriots reverse engineered the code for the world from their legally purchased copies of the game, and made it available on private servers to people looking to play without paying Blizzard's monthly fees. While the action never produced a judicial decision (as Reeves never answered or appeared in court, resulting in a default judgment for $88 million in damages), in calculating damages, the court noted that Reeves' website "enable[s] . . . users to access Plaintiff's copyrighted works and circumvent Plaintiff's protective measures." Blizzard at  3. This has the practical effect of invoking Section 1201 of the Digital Millennium Copyright Act, which makes illegal circumvention of technological copyright protection systems. The Blizzard court notes, however, that Reeves never actually sold products that circumvented such measures. Rather, Reeves sold products that "enhanced users' gaming experiences while infringing Plaintiff's copyrights." Id. at 2. This does not violate the DMCA, yet the court almost assumes that it does. Online games almost always involve some kind of protocol for signing in to the game servers, and some games require such a log in to play the game at all (either with others or by oneself). It becomes apparent quite quickly that any use of the game that does not correspond exactly to the developer's vision could become actionable under the Blizzard court's logic, should a case that actually reaches trial adopt the same approach. Mods, by their very nature, are meant to "enhance users' gaming experiences," and very often infringe copyright, albeit with the tacit approval of many developers. This is mostly speculation, of course. But gaming mods find themselves in a precarious state. On the one hand, they have never been more successful. On the other, they are increasingly finding themselves on the wrong end of legislation and judicial rulings. Despite a dedicated and vocal community peopled by game players and developers, mods will continue to be created only at the whim of game publishers and copyright owners. The law, as it currently stands, is not well-equipped to deal with community-generated media based on existing copyright. And as such, ambitious, incredible, and dedicated projects such as Tamriel Rebuilt (an attempt to recreate the worlds of six different games by Bethesda Softworks and synthesize them into one cohesive whole) may face extinction before they have even been completed.

Written by

November 6th, 2012 at 10:02 am

Posted in Commentary

Search the Blog