Oddly enough, the name of the bill wasn’t even Protecting Children from Internet Predators at the onset. It was originally titled the Lawful Access Act. The bill would have basically enabled law enforcement agencies, such as the Canadian Secret Intelligence Service, the Royal Canadian Mounted Police, and the Competition Bureau, access to private subscriber information from service providers without needing a warrant. The original title made more sense in regards to the content because after all, there was no mention of Internet predators in the actual bill.

There are three parts to the bill. Part 1 enacts the Investigating and Preventing Criminal Electronic Communications Act. This requires service providers to develop and maintain methods that would enable the lawful interception. Part 2 aims to amend certain sections of the Criminal Code so that it is perfectly legal to intercept and attain said information. And of course, the details of the specific circumstances are covered in this part. Although, hate propaganda makes an appearance, predators have yet to be mentioned. There is talk of ‘indecent communication’ and ‘commit[ting] mischief’, so maybe Toews thought the significant focus on child predators warranting a title change was implied? And lastly, the third part simply focused on the actual implementation.

Right before submitting, the bill underwent a quick last minute adjustment. The content remained the same but the name became Protecting Children from Internet Predators instead of Lawful Access. This change might have been a political strategy rather than based on any significant changes to the bill, especially since critics were repeatedly stating that the bill was simply about providing the government lawful access to citizens’ private information. There was also talk of infringing on Canadians’ constitutional rights. As such, the political nature of the change could be reasonably inferred that by using the new name, the aim was to shift the focus from these concerns unto the protection of children from Internet predators.

Sadly, it seems like Canadians were able to see through the attempt. The critics criticized and the opposition opposed. The resulting consequence was the consensus among the conservative party that the bill would be referred to a committee. But while, the conservatives had the whole summer to get the ball rolling, not much debate has occurred regarding the referral. Now, the new year, and still no movement. So now, the million-dollar question seems to be: is the bill still alive? While the conservative are stating that they’re working on it, opposition members are saying that they’re not really getting a proper answer. As such, it seems that the bill has disappeared for all practical intents and purposes. This will mostly likely induce a sigh of relief among those who value their privacy in this digital age. However, only time will truly determine whether Bill c-30 will make a reappearance.

It seems an obvious substitution: Silicon is right under carbon in the periodic table; It has no “element-specific” toxicity associated with it; It forms four tetrahedral bonds just like carbon.

However, it won’t readily form a double bond. And this is precisely why you might actually want to make the substitution. Haloperidol (1) is an antipsychotic drug known to metabolize into a neurotoxin in the body (3). Replace a carbon with silicon (See figure), however, and the neurotoxin can’t be generated. The Si=C bond needed to form the silicon analogue of the neurotoxin is too reactive and thermodynamically unstable under physiological conditions.

Another significant difference between haloperidol and its silicon analogue is that the analogue does not undergo glucuronidation, a process that makes a compound more water-soluble and can lead to high excretion levels (so that the drug cannot reach its target). The fact that the SiOH group was not glucuronidated could mean something important. A molecule that is too lipophilic is a common problem in drug design. A way to decrease lipophilicity while retaining major structural properties of a compound is to add OH groups. This addition, however, commonly leads to high excretion levels from glucuronidation (glucuronic acid adds to the OH).  If SiOH groups cannot be glucuronidated, adding SiOH to a compound could possibly decrease lipophilicity without giving high clearance.

Patents

So could replacing a carbon with silicon in a drug give you a new patent?  Even if you were to get a patent by making the substitution, with a case such as haloperidol it would be hard to rebutt “obviousness” if the patent was challenged. At the time the substitution was made the mechanism by which the neurotoxic metabolite is generated was well known. It would be easy to argue that A Person Having Ordinary Skills in the Art (PHOSITA) would think it “obvious to try” a silicon to block the elimination step in the mechanism.

However, a known metabolic profile does not mean all modifications made to change metabolism are obvious. Unanticipated results substantiate non-obviousness. In an investigation of torcetrapib, for example, 12 analogs likely to inhibit unwanted metabolism were made through substituting different combinations of hydrogens with deuterium, which is known to slow metabolism. While six showed surprising metabolic stability, the other half had torcetrapib-like metabolic profiles. Similarly, a compound with various potential C to Si switches does not necessarily predict which compounds will be successful. So the obvious substitution can be non-obvious.

* The closest we’ve ever been to a drug containing silicon is Karenitecin which went into phase III clinical trials in 2008

Sources

Franz, Annaliese K.; Wilson, O. Organosilicon Molecules with Medicinal Applications. Journal of Medicinal Chemistry 2012 <http://pubs.acs.org/doi/abs/10.1021/jm3010114>. Not in print yet.

Tacke, R.; Nguyen, B.; Burschka, C.; Lippert, W. P.; Hamacher, A.; Urban, C.; Kassack, M. U. Sila-trifluperidol, a silicon analogue of the dopamine (D2) receptor antagonist trifluperidol: synthesis and pharmacological characterization. Organometallics 2010, 29, 1652−1660.

I won’t go through the case here, as the links above will do the job much better, but essentially the legal issue is whether a U.S. copyright owner can use copyright law to prevent parallel import of copyrighted works purchased from another country. In the particular case at hand, the U.S. Supreme Court is being asked to decide whether a person can buy textbooks from Thailand and resell them in the United States. Naturally, due to differential pricing, the textbooks cost far less in Asia than they do in the U.S., creating the potential for market arbitrage. The question is whether copyright law can be used to prevent parallel import of goods.

Canadian copyright observers will note that the facts are very similar to a Supreme Court of Canada case, Euro-Excellence Inc. v. Kraft Canada Inc., 2007 SCC 37, that involved the import of Toblerone and Côte d’Or chocolate bars from Europe into Canada. In that case, Kraft claimed that Euro-Excellence infringed their copyright on the logos attached to each wrapper of the chocolate bars, and attempted to prevent Euro-Excellence from importing the chocolate bars for resale in Canada (presumably at a lower price).

The SCC decision spawned some confusion. Kraft’s two main legal arguments carried the day, each winning over a majority of the court’s justices, but because of the peculiar way the votes split, and also because they needed to win both issues together to succeed, they actually lost in the outcome by a 7-2 majority. In essence, a majority of the court (Rothstein, Binnie, Deschamps, Abella, and McLachlin) agreed that the logo as part of the chocolate bar was subject to copyright law, and a different majority of the court (Bastarache, LeBel, Charron, Abella, and McLachlin) agreed that Kraft Canada was within their rights to sue for hypothetical infringement based on their exclusive license.

The bittersweet decision for Kraft had two consequences: first, the court appears to have decided that copyright law can be used to block parallel imports if the two contested conditions were met (the plaintiff was an assignee of the copyright, and there was an actual sale of a copyrighted work). Indeed, Kraft Canada obtained the copyrights in question by assignment following the case, and began a second lawsuit against Euro-Excellence, which was settled in 2009 with a promise by Euro-Excellence not to distribute the chocolate bars in Canada without authorization (and a separate agreement for exclusive distribution in Quebec).

Second, the lack of clarity caused by the four judgments may have left open the broader question of whether copyright law can and should be used to regulate grey market goods. Academic commentators have noted that Canadian courts have largely ignored or avoided the issue of parallel importation in copyright law (see, for example, Rose Ann MacGillivray, “Parallel Importation: A framework for a Canadian position on exhaustion of intellectual property”).

More worryingly, a majority of the Supreme Court of Canada seems to have assumed, in Euro-Excellence, that copyright law could be used to regulate parallel imports. Rothstein’s judgment disposes of Kraft Canada’s claim based on a licensing issue, but states that assignees of the copyright would have a right to sue the assignor for hypothetical infringement (which was the basis of this parallel importation claim). Bastarache, meanwhile, narrows his judgment to an interpretation of the Copyright Act which precludes “merely incidental” works from being protected by copyright, but seems to suggest, if the good being sold had its “legitimate economic interests” based in copyright (such as, say, a textbook), then it would indeed be protected. Abella’s judgment also failed to discuss the pertinent issue of parallel importation, finding that a logo on the wrapper was enough to invoke copyright law against imports of chocolate bars. Only Fish appeared to address the issue directly, expressing “grave doubt whether the law governing the protection of intellectual property rights in Canada can be transformed in this way into an instrument of trade control not contemplated by the Copyright Act” (Euro-Excellence at para 56).

This brings us to Kirtsaeng v. John Wiley & Sons. The Supreme Court of the United States is revisiting the issue because of an unusual 4-4 tie in a very similar case, Omega S.A. v. Omega Corp., 541 F.3d 982 (9th Cir. 2008).

The textbooks in question were not counterfeit per se, as they were genuine copies sold in Thailand by a subsidiary of Wiley. However, due to differential pricing, the same books in Thailand were sold at a significant discount compared to those in the U.S. The question is whether, given that under American copyright law works imported without the consent of the copyright owner is a violation of their “distribution right”, the claim can be defended based on the first sale doctrine.

While it is unclear which party the court will side with (arguments were made today), what is certain is that the copyright world is closely watching the case, as it may determine the the boundaries of the first sale doctrine and has implications for the jurisdictional reach of American copyright law.

In Canada, the case may become influential just as Bill C-11 is about to come into force. As mentioned above, the first sale / exhaustion doctrine has not been well developed in Canadian jurisprudence. Unlike the U.S., the doctrine has not been codified in the Copyright Act – that was, until Bill C-11. Particular provisions of the new copyright bill, in particular amendments to s. 3(1)(j) and s. 1.1(b), appear to recognize the doctrine of exhaustion:

3.(1) For the purposes of this Act, “copyright”, in relation to a work, means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever, to perform the work or any substantial part thereof in public or, if the work is unpublished, to publish the work or any substantial part thereof, and includes the sole right…

(j) in the case of a work that is in the form of a tangible object, to sell or otherwise transfer ownership of the tangible object, as long as that ownership has never previously been transferred in or outside Canada with the authorization of the copyright owner (emphasis added)

With a dearth of previous decisions squarely addressing the doctrine of exhaustion, Canadian courts may be tempted to draw inspiration from their American counterparts.

If the U.S. Supreme Court decides the case in favour of Wiley, meaning that the first sale doctrine would not apply to goods made in a foreign jurisdiction, then   it could be possible that Canadian courts will follow suit. This scenario is made more plausible by the court’s decision in Euro-Excellence, which did not address the parallel import issue directly, and at least by a slim majority, leaves open the possibility of copyright law being used to regulate the grey market. With trade between US and Canada so prevalent, the explicit acknowledgement that American copyright laws can stop free market arbitrage could have a very noticeable impact across the border. Of course, at least with respect to books, Canadians are used to seeing higher prices than their American cousins.

PROCEDURE

EMI has sued RDigi’s for copyright infringement. EMI’s demands ReDigi to pay a penalty of $150,000 for each song in EMI’s catalogue that was sold via the service since its launch. In February 2012 EMI failed to get summary judgment. Therefore the case has proceeded to a full court hearing, which started on October 5, 2012. A judge at the district court in Manhattan, New York, heard last Friday opening arguments of both parties in the present case.

Plaintiff Claim (EMI)

Inapplicability of the first sales doctrine to digital files

EMI claims that the first sale doctrine does not apply to digital files as the only way to move those files is to make duplicates, and there is no guarantee that the original file has been deleted on resale.

EMI says that it owns the “exclusive rights” to manufacture, reproduce, distribute and sell digital versions of the copyright protected works of its artists, and refers to agreements signed with authorized services such as Apple’s iTunes and Amazon’s MP3 in support of its argument.

EMI also contends that given the widespread piracy of sound recordings it is questionable whether ReDigi can effectively determine that digital files have been legally obtained in the first place.

Finally, EMI notes that ReDigi has acknowledged that there is no way to ensure that users do not retain copies of the files they upload. Even though ReDigi’s software is designed to run “continuously” in the background to detect songs on any device attached to the user’s computers at a later date, users could presumably back content up on an external hard drive or other device.

 Preview songs constitutes another act of copyright infringement

A secondary claim by EMI is that 30 second clips/preview of songs offered by ReDigi and stored on users’ hard drives constitute another act of unauthorized copying.

ReDigi defense

First sale doctrine authorizes resales of digital content

ReDigi says that its software is designed to comply with existing United States copyright laws, claiming that EMI’s distribution rights are limited to material objects, and if digital files are judged to be material objects it can invoke the first sale doctrine which authorizes resales.

No copy involved

ReDigi argues that there is no copy involved, i.e. that it makes no unauthorized copies of songs but instead provides digital music storage and a marketplace for tracks legitimately bought from Apple’s iTunes store.”

IMPACT OF CAPITOL RECORDS LLC v. ReDIGI INC. CASE ON THE MEDIA INDUSTRY

US digital music sales are set to surpass CD and vinyl sales for the first time ever this year, according to research firm Strategy Analytics. It estimates that digital sales will rise to $3.4bn (£2.1bn), compared to $3.38bn for physical sales.”Most lawful users of music and books have hundreds of dollars of lawfully obtained things on their computers and right now the value of that is zero dollars,” said ReDigi’s chief executive John Ossenmacher.” Legal experts note that the financial impact of ReDigi’s business model could be larger if it is judged to be legal.”What this case points out is that the copyright statutes were written in an era when works of authorship were only available in tangible form,” said Jonathan Handel, an entertainment attorney at TroyGould lawfirm.

The EMI v. ReDigi lawsuit will in fact be closely watched by the media industry as it could set a precedent. For instance, Google has written a letter to the judge arguing that the company had a “specific and vital interest” in the outcome.

ADAPTABILITY OF THE FIRST USE DOCTRINE TO THE DIGITAL WORD

As Billy Barnes points out, the durability of the first sale doctrine is increasingly being tested in a world where entertainment products (such as books and movies) are delivered not as a physical product but as a digital stream.  I used to be able to take my CDs to any CD store and sell them once I was no longer interested in listening to them – to what extent, if any, do or should I have the same right if what I purchased was not a physical disc but a downloaded track (or book, or movie, etc.)?

COMPARATIVE LAW: EUROPE & CANADA

Europe:

Europe has already issued a ruling on a related case. Indeed, in July 2012, the Court of Justice of the European Union sided in favour of UsedSoft, a German company that resold Oracle software (Case C-128/11 Press and Information UsedSoft GmbH v Oracle International Corp.), arguing that “an author of a software cannot oppose the resale of his ‘used’ licences”.

Canada

Concerning the 1^st claim, the ability to apply the first sales doctrine to digital sales are even more relevant in Canada because, unlike in the United States, Canadian copyright law does not have a clearly defined “first sale” doctrine, particularly with respect to copyright law.  in Canada and in most of the commonwealth countries, the “first sale” doctrine is referred to as the concept of “exhaustion” (for the sale of the relevant product has “exhausted” the owner’s rights in it). This doctrine of exhaustion is fundamental to the balance between author’s rights and users’ rights. Indeed, the Supreme Court of Canada in Théberge v. Galerie d’Art du Petit Champlain inc., 2002 SCC 34 stated the following at paras. 31-32,

The proper balance among these and other public policy objectives lies not only in recognizing the creator’s rights but in giving due weight to their limited nature. In crassly economic terms it would be as inefficient to overcompensate artists and authors for the right of reproduction as it would be self-defeating to undercompensate them. Once an authorized copy of a work is sold to a member of the public, it is generally for the purchaser, not the author, to determine what happens to it.

Some years ago, Macklin and Leger wrote a report for the International Association for the Protection of Intellectual Property which observes the lack of an exhaustion doctrine in Canada.  More recently, Jeremy de Beer and Robert Tomkowicz have written “Exhaustion of Intellectual Property Rights in Canada“.  De Beer and Tomkowicz examine recent Supreme Court of Canada cases to tease out the contours of Canada’s “exhaustion” doctrine, and encourage the courts to more precisely define its limits.

In light of the ill-defined doctrine of exhaustion, one may wonder what would be the outcome of EMI v. ReDigi case in Canada?

Concerning the second claim i.e. that that 30 second clips/preview of songs offered by ReDigi and stored on users’ hard drives constitute another act of unauthorized copying, it could be interesting to see what impact the Supreme Court of Canada’s ruling in Society of Composers, Authors and Music Publishers of Canada v. Bell Canada, 2012 SCC 36 will have on this claim. One may remember that in this case the Canadian Supreme Court ruled that 30 to 90 second music clips offered by online music stores such as Apple constituted fair dealing.

A POTENTIAL JUDICIAL BATTLE BETWEEN ReDIGI & THE DIGITAL BOOK INDUSTRY?

Redigi has already announced plans to expand its business into the ebook market. This decision may ipso facto have tremendous repercussions on the digital book industry. This could lead to another judicial battle between ReDigi and digital book companies (such as Amazon) over whether digital book can be resold after it has been lawfully purchased.

This post is about licensing partly autonomous cars. Not legally speaking, autonomous cars are those which can drive themselves without any human input, and partly (or mostly) autonomous cars have reduced human input. They use sensors to provide electronic input to a rapidly interpreting computer, and the computer controls some or all of the car’s control mechanisms. There is a spectrum of automation: some commercially available cars offer semiautonomous parallel parking, others can keep a deemed safe distance behind the car in front, and the most advanced research and development (R&D) cars can drive across vast systems of roads without any notable human intervention. However, driving in “critical” situations, such as in extremely busy downtown streets with very high numbers of dynamic objects (bikers, pedestrians, other vehicles), has overwhelmed even the leading R&D autonomous cars’ computational systems, requiring human intervention. Power steering and anti-lock braking systems are early forms of automation.

Before diving into the the discussion, I will mention that most of the information in this article is from personal conversation with a scholar on the subject, Bryant Walker Smith, a fellow at the Center for Internet and Society at Stanford Law School and the Center for Automotive Research at Stanford, who also teaches a course on the subject: Legal Aspects of Autonomous Driving. He has been very kind in elucidating this undeveloped yet exciting field. He also has a blog on the subject.

The organization of this post is as follows. First, I will probe some of the legal and moral questions about autonomous cars and comment on the legislation. Second, I will present business opportunities in this emerging industry, and ensuing legal privacy issues.

LAW AND MORALITY

Here are some facts: Three states currently have laws for autonomous cars, though many others are currently considering legislation. In March 2011, the Nevada Legislature enacted a law authorizing the use of these cars on Nevada roads, and that same June, the Nevada DMV set standards and regulations governing such vehicles. This April, Florida clarified that individuals holding drivers licenses may operate an autonomous car, and that those cars are not banned from roads. Most recently, on September 25 the California legislature similarly enacted that autonomous cars are not banned from roads, and that manufacturers must disclose to consumers what information is collected while driving. They also define “operator” as the human who sits behind the wheel of the car or, if there is no human in the driver’s seat, engages the autonomous technology. The laws also set basic safety standards and requirements for testing and direct agencies to take subsequent steps for licensing, notably California requiring additional oversight when there is no driver in the driver seat during research runs. See more here, if interested.

For the purposes of this post, the term “driver” means the person who sits behind the wheel, and can disengage the relevant automation by turning the wheel or pressing the brake. The “automator” is the person or company who modified a traditional car to make it autonomous, for example Google. The “original manufacturer” is the car manufacturer of the traditional automobile before any automation takes place. A “manual” car is a traditional car operated by a human, i.e. having nothing to do with the transmission mechanism of the car.

I will now open up some legal questions arising from these cars.

From a pedestrian perspective, does it seem safe that some cars should be able to drive themselves? Who is liable, morally or legally speaking, if an autonomous car has an accident? Is anything wrong with a computer whiz strapping camcorders on his old Honda and feeding the input into a self-coded computer to automate his car? What do the old laws say about having these cars on the roads?

Google has been testing autonomous cars on Californian roads since 2010, two years before the California legislation was enacted. At that time Californian law did not ban autonomous cars from roads explicitly. There are anecdotes of police stopping the cars, befuddled at how or whether to issue a ticket, and usually ending up just taking a picture with the car for a neat keepsake.

Some individuals may not feel safe knowing there are autonomous cars on the roads. After all, driving is a very elaborate and dangerous process only made easy because of the extraordinary evolutionary faculties of the human complex. The inevitability of accidents attests to the chancy nature of driving, not to mention in extreme weather or emergency situations. Still, human error causes some ninety percent of crashes.

Products liability has been well established through legislation and the common law for manual vehicles. But, changing to automated cars, is the driver or the automator legally liable for an accident? This question is far from settled.

Traditionally, a sudden malfunction of a manual car (such as the steering wheel not working) makes the manufacturer liable under products liability. By parallel reasoning, one may argue that an automator is now responsible for the effectiveness for the autonomous car’s function (of driving) in the same way that a manual car manufacturer is responsible for the effectiveness of the manual car’s function (of providing reliable control mechanisms). Thereby, the automator should be legally liable.

On the other hand, the driver can be argued to have legal liability of an autonomous car. If an autonomous car is manned with a driver, then the driver can overtake the automation in critical situations, theoretically being able to stop accidents from occurring in the same way she could if she was driving manually. Even if the autonomous car does not have a driver, then perhaps the person who starts the car driving is liable, or the owner is. After all, the starter put this object out on the streets at her will, and it shall be at her peril if anyone or anything is damaged.

Actually, I would intuitively propose that the automator is morally liable for these cars. They build these autonomous cars for a specific purpose and if they fail at it then it is the automator’s failure. By virtue of the law punishing to the just proportion of moral culpability, I would tentatively propose that the automator should be legally liable in most cases.

The current state laws do not comment on liability in this sense. It is further undecided wheter the cause of action should be criminal and/or civil.

Is a driver of an autonomous car permitted to be inattentive while “driving”? Can bans on texting and calling while driving be lifted for these types of cars? Perhaps surprisingly, Nevada’s law allows the driver to use handheld communication devices while operating autonomous cars. Florida’s and California’s do not, but as the autonomous car technology becomes more trusted, I suspect most laws will address these questions in the affirmative.

Legal liability is probably one of the most important issues in legislating autonomous cars, yet it is not commented on in the current autonomous car laws. So what do the laws do, exactly?

These laws effectively only say that the driverless cars are not illegal for use on roads. They further define some jargon.

Nevada’s law sets a fairly high standard of what qualifies as an autonomous car: that the artificial intelligence “duplicate or mimic” human driving behaviour, and that the autonomous car drive itself “without active intervention of a human driver”. I take this to mean that novice attempts to create an autonomous car would not be acceptable, whereas one professionally tried and tested would be. If the cars failed these standards, they may not qualify under the law. Florida and California followed these definitions.

Florida also stated that the original manufacturer is to be dismissed from legal action in the case that an automator modifies the car and it causes injury. California’s law also requires that the automator disclose to the consumer what information is collected by the car. This issue is better discussed in section two.

BUSINESS OPPORTUNITIES AND PRIVACY

Google is the most publicly prominent autonomous car tester in the world, but certainly not the only one. Many car manufacturers like Lexus, Audi, Volvo, Mercedes-Benz, and Cadillac, and universities such as Stanford and Carnegie Mellon have also been exploring the technology. There are over one billion road vehicles in the world and about 250 million passenger cars in the United States. About 7 to 8 million combined national and imported cars are sold each year in the United States. The competitive advantage of automation has an obvious incentive in gaining market share. Indeed, the market itself will probably play a large role in persuading how to legislate autonomous cars.

But there are less obvious business opportunities. Autonomous cars have the potential to communicate with one another, indeed some fleets already do. On a broader scale, these fleets could synchronize traffic flow and ease jams. As well, high-tech cars open up high-tech roads, called vehicle-to-infrastructure technology, the seeds of which already exist, yet the full force of which we cannot expect for several decades, if ever. Knowing the conditions on roads can help direct autonomous cars to take more efficient routes. If every car is autonomous, there is, in theory, no need for traffic lights or traffic signs whatsoever.

Furthermore, cars can transmit data to both government and corporations in a very reliable manner, providing precious location and road use data. Could this mean personalized location-based advertising or other tracking?

Any privacy buff should be concerned at this. Informational privacy is becoming increasingly important in this technological age, and places visited while driving could arguably be part of the “biographical core” that has influenced so much s. 8 Charter jurisprudence. Anonymous tagging is all that is needed to facilitate much of the future technology already noted, yet digital information has historically been prone to corruption. The involved privacy issues alone are as dubious as they are lengthy, so I will leave this issue by saying that privacy law will be important in this industry.

What about parking? In theory, an autonomous car may drop off the driver, and go off to find a decent parking spot, or just drive around in a loop until it picks up its driver again. They can also park much more efficiently than humans. These are possibilities to explore.

The car-sharing industry has burgeoned recently with Zipcar and car2go. Autonomous cars may further reform this industry by delivering cars to individual’s locations. Hello, taxis. Goodbye, taxi drivers.

If individuals who commute for significant periods of time in cars each day no longer have to be attentive while driving, can they then begin to make their transportation time productive? Why not set up a veritable office inside of the car?

The possibilities of road and car digitization and automation are remarkable. Of course, it would be imprudent to expect such immense reform in the next few generations.

I look forward to seeing whether the Canadian provinces will legislate or regulate autonomous cars in the coming years, and whether the upcoming technological feats will be enough to win over consumers. I will be delivering more blog posts throughout the year as this law and jurisprudence develops.

–

Sources:

• Mashable and CBS SF
• Byrant Walker Smith, notably these two blog posts (1) (2)

The 10 patents in question touch on Facebook’s social networking concept, privacy controls, messaging function, advertising model and user customization capabilities. Indeed, nearly every aspect of Facebook as an online service is being challenged. This patent infringement lawsuit is so broad in scope that Yahoo claims that “Facebook’s entire social network model, which allows users to create profiles for and connect with, among other things, persons and businesses, is based on Yahoo!’s patented social networking technology.”

This lawsuit highlights some of the criticisms of software patent that have emerged in recent years. Software patents are often defined very vaguely, capable of very broad interpretations, such that they may cover general broad concepts that multiple software developers can easily think of on their own. For example, Patent #5,983,227 “Dynamic page generator”, one of the 10 patents in this lawsuit, describes a process to dynamically generate web pages based on user preferences. According to the patent filing, this patent was intended to generate news web pages that display custom selections of stock quotes, news headlines, sports scores, weather, and the like. Yahoo alleges that Facebook’s News Feed and Wall infringes this patent. Given its breadth, almost every web service that allow users to customize web pages may be considered infringements of this patent. Software patents have been criticized on this ground that innovation in the software industry can be easily stifled if holders of such broad patents are to enforce them aggressively.

Some companies acquire patents, enforce them against alleged infringers and collect settlements and damages as their main revenue source. This has given rise to defensive patents. Companies attempt to accumulate large patent portfolios, by patenting their own works and acquiring additional patents, as a way to defend against patent infringement litigations. Even internet giant Google, while advocating for patent reform, admits that it has no choice but to join in.

With large patent portfolios, an infringement lawsuit can be dealt with by reaching cross-licensing agreements with the suing company. That is to say, the parties involved can agree to grant each other the right to use their own patented technologies. A defendant company that has a small patent portfolio would be at a great disadvantage. Facebook has merely 21 patents, according to the US Patent Office website. This week, Facebook has begun its effort to remedy this disadvantage with its purpose of 750 patents from IBM.

It remains to be seen how this clash between two internet giants will play out. In any case, this is one more illustration that the US patent system is in need of significant reform.

The webcast of Prof Darnton’s lecture can be found here.

In North America, web companies have resisted government intervention and moved towards self-regulation. In late February, the Digital Advertising Alliance – representing over 90% of US online advertising – announced an industry-wide self-regulatory program for online behavioural advertising. Under the program, participating companies like Google and Yahoo have committed to implementing the Do Not Track option in web browsers. By year end, Google Chrome will become one of the last major browsers to support Do Not Track. Microsoft Internet Explorer 9, Mozilla Firefox, and Apple Safari already provide the option to send a Do Not Track header with each page request.

The latest move by the DAA coincided with the White House’s unveiling of voluntary privacy guidelines in the form of a Consumer Privacy Bill of Rights. These guidelines are intended to address sectors not already subject to federal privacy legislation. Seven key principles were outlined: individual control, transparency, respect for context, security, access and accuracy, focused collection, and accountability. While it does not specify Do Not Track as a solution, the Bill of Rights calls for more choice and control over the tracking of consumers’ online data. Both the White House and the Federal Trade Commission (FTC) have lauded the DAA’s announcement as a positive step forward in the direction of implementing concrete privacy protection measures. In fact, the FTC had recommended the Do Not Track concept in 2010 as part of its “privacy by design” approach. Nevertheless, the White House has asked legislators to enact proposed consumer privacy legislations to backstop the self-regulated regime.

In substance, the DAA’s recent initiative falls short of addressing key concerns regarding user tracking. The browser based opt-out function would block targeted behavioural advertising, but does not ensure that underlying user data will not be collected and stored in the first place. Furthermore, the proposal applies to third party companies, such as advertisers that track users via cookies, but not to first party service providers. User tracking for broad purposes like market research and product development will also be exempt from the program.

The European Union’s Article 29 Data Protection Working Party has pointed out that the DAA-style self-regulatory rules do not satisfy the applicable European privacy standards. In a recent letter, the working party chair stated:

DNT should imply that no user data are collected, retained, processed and shared anymore, with the exception of information strictly necessary to provide the service explicitly requested by the subscriber or user. It must be clear that data from a user with an active DNT-setting cannot be used for purposes such as “market research” and “product development”

The World Wide Web Consortium (W3C) – an international body that develops web standards – also welcomed the DAA program, and is pushing head with the development of international e-privacy guidelines. Its member company Mozilla was the first to implement browser-based Do Not Track. In response to the DAA proposal, Mozilla reiterated its commitment to working with W3C and the three underlying principles of giving user real choices, minimizing data collection, and letting users control their online experiences.

Some view the DAA’s Do Not Track mechanism as an attempt to preempt W3C’s standard development. It is not clear, however, that self-regulation will remain the industry’s modus operandi for long. Government regulators and international bodies are paying increasingly closer attention to the privacy policies and practices of web service providers and online advertisers. For instance, the National Association of Attorneys General (NAAG) recently sent a letter to Google CEO Larry Page expressing concern over Google’s new privacy policies and asking for an opt-out option to be provided. As privacy breaches continue to make news headlines, the popular demand for meaningful choice and control over the tracking of user data would likely go unsatisfied by the industry’s self-proposed rules. Depending on the pace and scope of implementation of measures like DAA’s Do Not Track, it may be a matter of time before industry self-regulation gives way to legislative enactments and government regulation.

Google’s policy has been criticized by some for collecting far too much information on users, as well as being inflexible. A quick examination of the policy notes that Google ‘may’ collect information as diverse as your phone number, your phone’s hardware model, unique application numbers about installation of Google products, and your actual location when using GPS signals among other types of information. Google plans to use this information to ‘tailor’ its services to individual users and provide better ‘targeted advertising’. Where previously, one’s search terms on Youtube would not affect advertising or search recommendations while using any different Google service, this will not be the case anymore. However, the new model has been criticized for a number of reasons. Firstly, there is no real opt-out procedure here. An individual can delete their previous Google browsing history, but other than that they only really have one option. A user can either accept the new policy, or they can stop using Google services. There is no middle ground, something that has been criticized by the FTC. As any Google user will tell you, the new policy changes were presented to users by virtue of a small pop-up message when one opened their Gmail account for example. Of course, this is probably not the best way to have presented these important changes, because individuals have become accustomed to ignoring pop-ups, treating them the same way they treat End-User License Agreements. Google should have probably found a better way to disseminate this information. However, there are other important concerns around this policy.

The European Union’s Justice Commissioner stated that the new policy violates European law, suggesting they had major doubts about the combination of all of this personal data across services. CNIL, a French watchdog group, noted that the new policy would allow ads related to activity on an individual’s phone, including date and time of calls, and other party calling numbers. Many people, this writer included, don’t like sharing this type of information with people they know, let alone with Google and essentially with advertisers. Google has responded by saying that they believe their policy is in fact consistent with European law and are worried that the European rules and suggestions would “break the internet”.

American regulators have also had concerns. Some questions have arisen as to whether Google would change or manipulate search results in a manner to promote Google and Google products. American lawmakers have also asked the question about why there is no opt-out procedure.

On the other side of the debate is Canada’s privacy commissioner, who called it “a step in the right direction”. However, even that comment came with some questions and concerns about the opt-out procedure.

While it’s unclear what direction Google should be going in, the one thing that is abundantly clear from the reactions around the globe is that Google’s roll-out of this new policy was not done the right way. Though Google has stood its ground and suggested that they have not run afoul of any regulations, the concerns that the public has around this policy should not be brushed aside so blithely.

There is a concern that Google is essentially putting the interests of advertisers, and therefore their main source of revenue, ahead of the interests of its users. While this wouldn’t be an entirely surprising motive, it is of course a major concern. The fact that Google has streamlined its ‘data collection’ and where it might have previously had a number of spread out and disparate troves of consumer information to offer advertisers it now has systematic and easily categorized trove of data. Advertisers will likely be willing to pay larger amounts for the data now as they will be better able to target advertising and do more with it. Though nobody should fall for the mistaken idea that they have anonymity on the internet, Google’s motivations for this new privacy policy could certainly be questioned. The information they themselves presented about this change to users was couched in terms that suggested a streamlining to provide a better user experience, but this is clearly a double-edged sword.

Google has almost certainly put itself in a situation where they are facing litigation of some sort, and it seems as though they may have been unwise in rolling out their new policy in the manner they did. One suggestion would have been to have found a better way to inform individuals about this new policy, either by forcing users to read it and accept or deny the terms before the use of their next Google service, or through another method to ensure awareness. There is something disingenuous about forcing a change upon a user base that for its majority probably hasn’t understood or even been cognizant of the change.

This situation however does provide individuals with a chance to reconsider how they approach the internet. Many individuals are fairly passive in this regard, and perhaps a more proactive approach is what would be better. The internet is treated as a place where you can go around with anonymity, but the fact of the matter is that the internet is fairly public and is becoming increasingly public all the time. In the face of changing privacy policies, individuals need to become actively involved in how they manage their use of the internet. This change in policy from one of the most important internet companies may be the trigger that sparks change.

Sources:

Google Privacy Policy: http://www.google.ca/intl/en/policies/privacy/

1. http://www.techdirt.com/articles/20120301/10313817930/google-asking-trouble-with-its-new-privacy-policy-eu-official-questions-legality.shtml

2. http://calgary.ctv.ca/servlet/an/local/CTVNews/20120301/google-privacy-policy-takes-effect-120301/20120301/?hub=CalgaryHome

3. http://www.bbc.co.uk/news/technology-17205754

4. http://www.cnil.fr/english/news-and-events/news/article/googles-new-privacy-policy-raises-deep-concerns-about-data-protection-and-the-respect-of-the-euro/

5. http://www.theglobeandmail.com/report-on-business/international-news/us-lawmakers-press-google-on-privacy-policy-changes/article2316639/

6. http://www.theglobeandmail.com/news/technology/tech-news/google-on-eu-privacy-plan-dont-break-the-internet/article2317695/