Articles Posted in Government

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In the aftermath of the Snowden scandal, and an on-going concern for cyber-surveillance practices, the United States Congress and the American people are increasingly concerned that their online privacy is at risk. The government continues to wrestle with the possibility of including mandatory data retention standards for Internet Service Providers (“ISPs”). While this poses a serious threat to individual privacy, supporters of data retention argue that these standards are essential to national and personal safety.

What Is Data Retention?

Data retention is the practice of ISPs monitoring and storing information tied to an IP address, including, but not limited to, browsing history. ISPs that also provide email services may store email logs, but not the content of those emails. ISPs also have the capacity to identify which third-party email service providers are tied to an IP address. Law enforcement agencies could require ISPs to turn over this information in the course of a criminal investigation. PRISM, the National Security Agency’s avenue of access to online data, is similar to traditional data retention practices, except that PRISM targets cloud-based services. Currently, there are no mandatory data retention policies in America. However, governmental pressures and international influences may be pushing America to join Europe in its data retention practices. In March 2013, James Sensenbrenner, Republican House representative from Wisconsin and the author of the Patriot Act, argued that America should adopt ISP data retention laws similar to those in Europe. Indeed, the Justice Department has fully supported data retention policies. The Justice Department argues that the lack of data retention policies dramatically hinders law enforcement efforts. However, regardless of whether the government implements policies requiring ISPs to store personal data, ISPs currently maintain the freedom to monitor and track online activity. Indeed, Time Warner currently retains user data for six months, and Verizon retains data for eighteen months. Then, under the Stored Communications Act, which is codified under 18 U.S.C. § 2701 et seq., the government may access this data.

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In January 2012, the European Union (“EU”) introduced a draft regulation that would make it more difficult for companies within the EU to gather personal data from consumers. In the wake of recent developments that the National Security Agency has been involved in questionable surveillance practices in the United States, the European Union is certainly taking steps to provide greater individual privacy protections.

What Are the Terms of the New EU Personal Data Directive?

The right to privacy is an important component of the European Convention on Human Rights, a highly developed area of law in Europe. According to the new regulation, institutions may only access personal data if the purpose for gathering the personal data falls within three categories. First, a company or agency may collect and process personal data if the individual is first informed. For example, among other preliminary requirements, the individual must initially be aware of the purpose for gathering personal data. Germany’s chancellor, Angela Merkel, has urged the EU to adopt additional restrictions to require internet companies to reveal details about the companies they will be sharing personal data with. Next, a company or agency may collect personal data if the data is “adequate, relevant and not excessive” in relation to the purpose for the collection. Additional restrictions may apply if the data is more personal, such as when the data goes to religious beliefs, political affiliations, sexual orientation, or racial association. Finally, personal data may be gathered and processed for a “legitimate purpose.” However, this is a very narrow category and the reasoning behind the data collection must be very specific. As an added safeguard, any data collected within the EU may only be transferred to countries outside the EU if those countries provide substantial levels of personal privacy protection as well. This requirement would pose an obstacle for social media websites, such as Facebook, that exist across the world and gather information from users to share with companies that operate under different privacy-protection standards.

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In recent times, the threat of privacy invasions has spread far beyond domestic governmental agencies, but to also include foreign and international governments. Do you travel outside of the United States? Do you travel with electronic devices, such as a cellphone or laptop? Do these devices hold any sensitive information, such as passwords or confidential communications? If yes, then your electronic privacy may be compromised when you travel abroad.

What Is the Threat to Privacy Abroad?

The simple truth is that border patrol agents in countries around the world take data from cellphones, laptops, and other electronic devices as tourists cross their borders. This data can include, but is certainly not limited to, passwords, files, and emails. Although, this is a common practice around the world, most tourists have no idea that their personal information becomes increasingly more vulnerable to invasions of privacy when they leave the United States. Indeed, the threat extends to hotels that may extract information from electronic devices through their free wireless systems.

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The Federal Trade Commission proposed a revision to the federal Children’s Online Privacy Protection Act (“COPPA”), which became effective as of July 1, 2013. As the FTC and state attorneys become increasingly stricter with online child protection standards, this rule will mean that online activity will be monitored more closely for inappropriate material. Indeed, this new rule has expanded what inappropriate material entails. Do you have a child with access to the internet? Are you a business entity that collects user information over the internet for marketing purposes? In both cases, this new rule may apply to your activities.

What Does the New Rule Add to COPPA?

First, the new rule substantially expands the meaning of “personal information.” Prior to this revision, personal information applied to an online user’s name, physical address, email address, telephone number, and social security number. However, the revision expands this category to include significantly more information. Online contact information will now include identifiers for instant messaging, Voice over Internet Protocol (VoIP), and video chat users. Additionally, online screen names will now be considered “contact information” because such information may be used to locate minors on the web. To this same effect, any online information that can help locate the physical address of a minor will constitute “personal information.” This information will include photographs, videos, and audio files that contain a child’s picture or voice. It will also include information such as an Internet Protocol address (“IP address”) or mobile device identification names, since they can help locate users as well. Indeed, any information that configures with geographic locations, such as street names and cities, will constitute “personal information.” The rule also limits the extent to which companies that gather “personal information” from minors can share this information with third parties.

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Patent law reform has recently moved to the forefront of the federal legislation calendar as the country calls on Congress to protect inventors and consumers from intellectual property trolls (“IP trolls”). IP trolls may also be known as patent assertion entities. These IP trolls include individuals or entities that do not necessarily generate innovations themselves, but rather buy and hold patents, copyrights, or trademarks. Then, the IP trolls instigate infringement litigation against parties who use the otherwise idle intellectual property. Are you in litigation against an IP troll for alleged infringement? Do you have a non-active patent that may interest IP trolls? At the Law Offices of Salar Atrizadeh, an attorney with experience and knowledge in intellectual property law and infringement litigation can help you understand your legal rights and remedies.

What Are the Negative Effects of Intellectual Property Trolls?

IP trolls target idle intellectual property and file lawsuits, which the majority of consumers find to be frivolous and unjustified (i.e. lacking any merit or good-faith cause to sue). Recently, President Obama signed the America Invents Act (“AIA”) into law in an effort to protect against such frivolous litigation. The AIA is the first attempt by the federal government to curtail intellectual property claims by such IP trolls. For example, the AIA requires that IP trolls file individual actions for infringement, rather than a single action against multiple defendants. This requirement will substantially increase the cost of litigation for IP trolls, and, perhaps hinder them entirely. Indeed, some cases may reach extremely high litigation costs. For example, MPHJ Technology Investments, LLC, a Texas-based patent-licensing company, recently sued consumers for scanning any document to send by email. MPHJ sent consumers letters demanding $1,200 to cover the cost of wrongfully scanning documents, which they claim to be a patented process calling for royalties (i.e., payments to the patent holder for using the patented technology). Otherwise, MPHJ threatened the consumers with litigation. A complaint filed in a Vermont state court aims to protect consumers from such patent troll litigation in the first lawsuit of this kind.

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In April 2012, President Obama and the United States Congress signed the JOBS Act into law. The Jumpstart Our Business Startups (“JOBS”) Act goes a long way towards accelerating and promoting crowdfunding. Crowdfunding is the practice of raising capital for a project or business by seeking small amounts of money from several individuals or small groups. Do you operate a small business? Are you looking for new ways to gather revenue for your growth and development? Are you an individual investor looking for your next investment project? If you answered “yes” to any of these questions, then the 2012 JOBS Act allows you to redefine your approach to future investments and business.

How Will the JOBS Act Change How Small Businesses Operate?

Since the JOBS Act passed into law, crowdfunding has increased through platforms such as Kickstarter, Indiegogo, and Fundable. These platforms have helped launch all sorts of small businesses, including startup companies, film projects, music projects, and non-profit organizations. Crowdfunding has essentially redefined traditional notions of how small businesses gather funds to support projects and growth. As such, in order to take advantage of this new opportunity, small businesses must learn to market their operations and projects to the masses. Reaching a wide array of people helps these businesses appeal to the individual investors who participate in crowdfunded business. Successful crowdfunding requires a small business to establish and maintain supporters at all stages of a project or throughout the course of a company.

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The central provisions of the Leahy-Smith America Invents Act (the “AIA”) went into effect in March 2013, revolutionizing the United States patent system. Traditionally, the United States had maintained a “first-to-invent” patent system, which awarded patent rights to the first inventor who created a unique invention. However, as the AIA went into effect, not only did the statute change the effects of U.S. patent law, but it also affected how inventors will make the decision of whether to file patents.

How Does the AIA Change the U.S. Patent System?

Before this new provision, the United States Patent and Trademark Office (“USPTO”) awarded patents to the individual or entity that invented first, rather than the individual or entity that filed an application for a patent first. Now, an inventor could lose patent rights to another inventor who potentially created the same invention later in time, but managed to file a patent application for the same invention sooner. Essentially, regardless of who conceptualized an invention first, the first to submit a good-faith patent application secures patent rights.

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President Obama signed the Patient Protection and Affordable Care Act (“Act”), or ObamaCare, as it is more commonly known, into law on March 23, 2010. The Act intends to decrease the number of Americans who do not have medical insurance. Additionally, the Act aims to decrease the overall cost of healthcare in the nation. One of the primary provisions of the Act requires employers that have at least 50 full-time employees to provide healthcare benefits for their employees. If such employers fail to provide benefits adequate under government standards, the employers will have to pay a fine. In National Federation of Independent Business v. Sebelius, the plaintiffs questioned the constitutionality of ObamaCare, arguing that the federal government did not have the authority to require businesses to provide health care. Ultimately, the Supreme Court of the United States upheld the constitutionality of ObamaCare.

Although, ObamaCare will not go into effect until 2014, it is already starting to have an effect on small businesses in America. Indeed, the Treasury Department and the Internal Revenue Service released regulations, in December of 2012, that require companies that average 50 or more full-time employees to provide healthcare or pay a fine now.

The way small businesses structure in 2013 could determine their status under ObamaCare next year. Companies have considered limiting growth to eliminate the need for additional employees. Accordingly, employers are choosing to outsource work instead of hiring full-time employees in order to avoid the cost of providing government-approved health care. Also, employers are hiring employees only on a part-time basis to avoid meeting the standard under ObamaCare.

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The news outlets have been reporting that the Chinese have allegedly been hacking into American infrastructures. Assuming this report is accurate, the United States is not equipped to handle the consequences of such an attack. These hackers would possess the power to disable the critical infrastructure in this country, eliminating electricity, gas, water, and all major transit systems. Indeed, earlier this year, both The New York Times and The Wall Street reported that hackers had infiltrated their systems and stolen confidential employee information. The New York Times has further reported that it has been experiencing constant attacks from the Chinese in an attempt to control information that pertains to China. The Ministry of National Defense in China denies any such cyberattack on The New York Times. In light of these recent developments, it has become increasingly important for individuals and businesses to take steps to ensure their cyber protection. By serving California and Washington D.C., the skilled attorneys at the Law Offices of Salar Atrizadeh successfully work on legal matters pertaining to cybersecurity and Internet law.

The former Secretary of Defense, Leon Panetta, has described the scene that will unfold after such an attack as a “cyber Pearl Harbor.” Indeed, these hackers could possess software with the capacity to destroy infrastructure hardware. Such an attack would spread chaos throughout the country for months while the government works to restore its vital systems. Pointing to the failed Cybersecurity Act of 2012, Panetta has called upon the private citizens and businesses to act to secure their cybersecurity. Hillary Clinton, former Secretary of State, confirmed that this was a crisis that required global attention.

These instances of “cyberterrorism” threaten to cause damage far beyond the destruction of 9/11. Mandiant, a cyber-security company based in the United States, traces these cyber-attacks to the People’s Liberation Army, the Chinese military. The efforts in America to make sense of these attacks have not led to any definitive answers. The dangers of cyber-attacks are apparent in the recent attack on Aramco, the Saudi Arabian oil company. The attack consisted of a virus, which destroyed 30,000 Aramco computers, and replaced essential files within the system with an image of an American flag burning. There was also a reported cyber-attack on Telvent (now known as Schneider Electric), an international corporation that provides companies with the network and connections to remotely control power grids, oil pipelines, and gas pipelines. It remains unclear whether the hacking efforts are meant to steal confidential information, or whether the hacking is part of a larger scheme to derail vital American infrastructures. Indeed, the threat may not be limited to the Chinese, but rather part of a greater effort to launch an attack against American cybersecurity. This certainly poses a threat not only for national security, but also for individual cyber-security involving consumers and businesses that compose and participate in the crucial business and technology infrastructures.

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In light of recent news that America’s cyber-network is vulnerable to outside attack, President Obama signed an Executive Order to improve cyber-security for the nation’s “critical infrastructure.” According to the Order, “critical infrastructure” applies to the vital physical and virtual systems in the United States that are essential to the country’s economic security, public health, and safety. This definition is in line with the definition of “critical infrastructure” in the Cybersecurity Act of 2012, which the federal government failed to pass.

The Executive Order is meant to promote greater information sharing among members of the same network. This will ensure that all network providers are adequately aware of potential threats to the system in time to plan and implement an effective response. Accordingly, American companies now bear the responsibility of evaluating whether “critical infrastructure” applies to their operations. Alternatively, the Executive Order may also apply to companies that provide goods or services to other companies that the Executive Order implicates. In this case, the Executive Order would also apply to the companies that provide the goods or services. These companies would then bear the same responsibility to abide by the Executive Order and participate in the information-sharing network.

The Executive Order also requires various federal agencies to participate in this network. The Office of the Attorney General, the Department of Homeland Security, and the Office of National Intelligence, among others, are responsible for participating to create an information-sharing network. Such a network will make it easier to detect and ward off cyber-threats. Additionally, the information-sharing network will allow the participating agencies to quickly notify the President of any legislation that is necessary to further protect the nation’s cyber-network. Furthermore, a working and productive network will incentivize other agencies and companies to join the network. Increased participants will improve the breadth of the network, work to expand the reach of the network, and add to the information that is available within the network.

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