The EU-U.S. safe harbor agreement for transfer of personal data is invalid and should be suspended, European Court of Justice (ECJ) Advocate General (AG) Yves Bot said Wednesday in an advisory opinion. The European Commission, which is scurrying to renegotiate safe harbor with U.S. officials, said it's "confident" of a "positive conclusion" soon. Industry lawyers warned that the opinion, if adopted by the ECJ, could spell trouble for American companies seeking to do business in Europe. Privacy advocates, however, said it could signal the beginning of a better data protection system. The ECJ isn't bound by its advocates' opinions but generally follows them.
Court of International Trade activity
Former FTC Commissioner Josh Wright shared during a Federalist Society teleforum Tuesday that the highlight of his tenure at the FTC was the issuance of the commission’s FTC Act Section 5 statement. Wright, who left the commission in late August, suggested his replacement come in with an agenda so he or she could focus his or her efforts, and pushed back against those who said he had a negative view of the agency, saying he agreed with the majority of commissioners 99 percent of the time.
Sen. Orrin Hatch, R-Utah, pressed for passage of his Law Enforcement Access to Data Stored (LEADS) Abroad Act (S-512) Wednesday during a speech hosted by the Media Institute. The legislation is “one approach” to what he sees as a problem, Hatch told attendees. “I could use your help.” Alternative approaches could include a focus on nationality of users, he said. “Without an appropriate legal framework, the current state of affairs regarding extraterritorial use of warrants puts the privacy of American citizens at risk,” Hatch said. “That is why I introduced the LEADS Act: to promote international comity and law enforcement cooperation. To date, the bill has received broad bipartisan support in both the Senate and the House of Representatives and from trade associations and the business community.” The bill is backed by six other Republicans and six Democrats. Hatch urged an update of the Electronic Communications Privacy Act (ECPA), the topic of a Judiciary Committee hearing earlier Wednesday. Hatch urged an overhaul of that act, saying “virtually everyone agrees” that privacy protections should be the same both online and offline. “Lest you think there are no reciprocal or far-reaching consequences, imagine a scenario where China wants to access emails stored in the United States,” he said. “Instead of going through established diplomatic channels or international treaties to obtain those emails, Chinese officials could go to a China-based company, like Alibaba, and demand that it retrieve emails from its U.S. servers and turn them over. This disturbing hypothetical could well become a reality because of our government’s position on the extraterritorial reach of U.S. warrants. In fact, the lawyer who is litigating the Microsoft case on behalf of the government acknowledged last week that the ability for a foreign government to require disclosures of a U.S. provider ‘should be of some concern.’” Hatch made many references to the recent oral argument that Microsoft participated in before the 2nd U.S. Circuit Court of Appeals in New York (see 1509080052). He said Wednesday's Senate hearing was "helpful" in the broader ECPA overhaul efforts: "We're making some headway."
After the main part of a summer FCC administrative law judge hearing ended over whether a cable operator discriminated against an independent programmer by moving the indie to a less-popular channel tier, both sides traded filings on who is at fault. That came Friday in docket 12-122. That Cablevision never considered moving an affiliated network, rather than Game Show Network, from basic cable to a sports tier, and dangled the option of its return to basic only if GSN affiliate DirecTV gave good carriage to Cablevision-affiliated Wedding Central, makes it indisputable that GSN was discriminated against, said the indie. The operator countered that GSN's assertions lack any proof: "GSN has not introduced a single piece of direct evidence that Cablevision discriminated ... to favor its affiliated programming networks, WE tv and Wedding Central."
Trade associations and groups representing both sides in a federal appeals case that hinges on whether the International Trade Commission has jurisdiction to block transmission of digital information into the country think the outcome could have lasting implications on digital trade and international data transmission, representatives of those factions told us.
The International Trade Commission and ClearCorrect, maker of corrective orthodontic devices, during oral argument Tuesday in the U.S. Court of Appeals for the Federal Circuit mainly debated the scope of ITC jurisdiction and whether it's able to block importation of digital information. The case, heard by Judges Kathleen O'Malley, Sharon Prost and Pauline Newman, was brought to the court by ClearCorrect. It claims the ITC overreached its abilities to regulate goods when it released an order prohibiting the firm's Pakistan branch from sending alleged patent-infringing digital data to the company's headquarters in Houston. The ITC ruled ClearCorrect infringed on patents encompassing the plastic orthodontic molds used as an alternative to braces held by industry leader Align Technology. Many tech companies backed ClearCorrect.
A New York Times editorial urged the U.S. Court of Appeals for the Federal Circuit to reverse an International Trade Commission ruling preventing the transmission into the country of data found to be infringing on existing patents. The appeals court case, to be heard Tuesday at 10 a.m. in courtroom 201, pits dental braces alternative manufacturer ClearCorrect against the ITC in its appeal of the commission's decision to prohibit the company from receiving electronic information from its branch in Pakistan. The ITC said the company infringed patents held by industry leader Align Technology, and ruled last year to block data used to determine molds for a patient's orthodontic device being sent electronically from Pakistan to the company's headquarters in Houston. "Because it defines the limits of the commission's authority, Congress should decide whether the changing nature of international trade requires the government to apply the same rules to data that it does to physical goods," the Monday editorial said. "History suggests that it might not be sympathetic to the commission's position." The editorial also said the commission's ruling, if not struck down, "is bound to hamper the exchange of ideas and information on the Internet."
A federal court accepted the requests of parties to file amicus briefs supporting petitioners challenging the FCC net neutrality and broadband reclassification order. An order Tuesday of the U.S. Court of Appeals for the D.C. Circuit in USTelecom v. FCC, No. 15-1063, granted the motions of: (A) Richard Bennett, (B) the Business Roundtable, National Association of Manufacturers and U.S. Chamber of Commerce, (C) Center for Boundless Innovation in Technology, (D) Georgetown Center for Business and Public Policy, Georgetown University, (E) International Center for Law and Economics and Affiliated Scholars, (F) former FCC employee William Kirsch, (G) Mobile Future, (H) Multicultural Media, Telecom and Internet Council, (I) Phoenix Center, (J) Telecommunications Industry Association and (K) Christopher Yoo, a law professor at the University of Pennsylvania. The Competitive Enterprise Institute, ex-FCC Commissioner Harold Furchtgott-Roth and Washington Legal Foundation had filed notices of their intent to file amicus briefs; lawyers for the three said they didn't have to file motions because they received the consent of all the parties to the case. (For more on the arguments the parties plan to make in their briefs, see 1507130064, 1507140035, 1507150012, 1507210054 and 1507270045). The briefs of the amici and intervenors supporting petitioners are due Thursday. Tuesday's order also directed the court's clerk to file Kirsch's brief, which he submitted early to protect petitioner due process rights. Kirsch said the FCC arbitrarily and capriciously failed to address his comments in the net neutrality proceeding on international telecom. "The FCC is entitled to deference for a Title II Court-guided classification, but should be subject to a de novo review for a quasi-judicial standard in place of the rules based approach that should be required of a so-called expert agency," Kirsch's brief said. It addressed intervenors' standing to address harm from "gatekeepers" and petitioners' standing to address harm from the U.S. Trade Representative's decision ceding the country's telecom advantage in the World Trade Organization agreement on basic telecom to trading partners, including China.
Three companies are challenging in court the July 10 FCC declaratory ruling to clarify the Telephone Consumer Protection Act (TCPA) (see 1507130039). The Association of Credit and Collection Professionals (ACA) International said the ruling is “at odds” with the original act. The Professional Association for Customer Engagement (PACE) and Sirius XM Radio also filed petitions for review. ACA said the ruling created "tremendous new TCPA risks for businesses that contact consumers by telephone." Considering the number of petitioners that sought relief, ACA said the "battle against the FCC’s interpretation of the TCPA is far from over."
Entercom is trading four Denver-area radio stations to Bonneville International in exchange for one in Los Angeles and $5 million, to satisfy Department of Justice conditions on Entercom's purchase of Lincoln Financial Media. Being traded to Bonneville are Entercom's KOSI(FM) Denver and Lincoln Financial's KYGO(FM) Denver, KKFN(FM) Longmont and KEPN(AM) Lakewood. Entercom will pick up KSWD(FM) Los Angeles from Bonneville. The stations will change hands once the Lincoln Financial acquisition closes, Entercom said in a Tuesday news release. That swap will end DOJ Hart-Scott-Rodino Act review of the acquisition -- a review that had focused on how the deal would affect the Denver radio market. The stations currently owned there by Entercom and Lincoln have among the highest ratings in the market, and the Lincoln sale would have meant higher radio advertising prices and lower quality service there, DOJ said. Its Antitrust Division sued Entercom Tuesday in U.S. District Court in Washington to block the Lincoln sale, while simultaneously filing a proposed settlement. The $105 million Lincoln acquisition and the Entercom/Bonneville trades are expected to take place within days, Entercom said.