Tag: legal

European commission reforms data protection

European flagThe European Parliament and the Council have agreed on laws to sort out data projection rights across the EU.

The Reform package will put an end to the patchwork of data protection rules that currently exists in the EU.

Andrus Ansip, Vice-President for the Digital Single Market, said: “Today’s agreement is a major step towards a Digital Single Market. It will remove barriers and unlock opportunities.”

He said that privacy and data protection should not hold back economic activities, but should be seen as an essential competitive advantage.

The EU’s next step is now to remove “unjustified barriers” which limit cross-border data flow. This is when local practice and sometimes national law, limits storage and processing of certain data outside national territory.

Věra Jourová, Commissioner for Justice, Consumers and Gender Equality said the new pan-European rules are good for citizens and good for businesses.

“Citizens and businesses will profit from clear rules that are fit for the digital age, that give strong protection and at the same time create opportunities and encourage innovation in a European Digital Single Market. And harmonised data protection rules for police and criminal justice authorities will ease law enforcement cooperation between Member States based on mutual trust, contributing to the European Agenda for Security.”

Basically the reform will allow people to regain control of their personal data. Two-thirds of Europeans (67 per cent), according to a recent Eurobarometer survey, stated they are concerned about not having complete control over the information they provide online.

They will make it easier access to your own data so that they can say how their data is processed. They will be able to transfer personnal data between service providers.

There will be improvements to the “right to be forgotten” when you no longer want your data to be processed, and provided that there are no legitimate grounds for retaining it, the data will be deleted.

The EU will enshrine the right to know when your data has been hacked so that companies and organisations must notify the national supervisory authority of serious data breaches as soon as possible so that users can take appropriate measures.

The regulation will establish one single set of rules which will make it simpler and cheaper for companies to do business in the EU and there will be one single supervisory authority. This is estimated to save €2.3 billion per year.

One interesting rule change is that SMEs are exempt from the obligation to appoint a data protection officer insofar as data processing is not their core business activity. This removes the current requirement in the UK for small clubs and businesses to treat their membership lists in the same way as big multinationals.
Following political agreement, the final texts will be formally adopted by the European Parliament and Council at the beginning 2016. The new rules will become applicable two years afterwards.

Dell saves bomb thanks to legal ruling

Dell logoA legal ruling about who is actually a Dell investor will save the company a bomb.

The legal question decides who the record holder of a stock was and it might seem a simple question, but it was vital to Dell’s privatisation of his company.

A Delaware Court of Chancery judge removed several large investors from a consolidated lawsuit stemming from the $24.9 billion buyout of Dell in 2013 by founder Michael Dell and his private equity partner, Silver Lake.

Investors who opposed the deal, at $13.75 per share, asked a Delaware judge in 2013 to determine the fair price for the stock, a process known as appraisal.

To seek appraisal, shareholders cannot have voted in favour of the proposed buyout, and they have to be a continuous holder of record through the date of the deal.

Vice Chancellor Travis Laster ruled that three funds and two retirement plans, which held a combined 922,975 Dell shares, failed to meet the continuous ownership requirement.

The investors had not sold their Dell stock after seeking appraisal. Rather, the funds lost their appraisal rights due to a series of administrative moves by back-office firms that carry out share transfers.

Affiliates of North-western Mutual Life Insurance, Manulife Financial, T. Rowe Price, Milliken Retirement Plan and Curtiss-Wright Corp Retirement Plan, held Dell stock through custodial banks. The investors were beneficial owners, but the legal owner was Cede & Co, a share aggregator that owns the majority of publicly traded shares.

When the investors sought appraisal, Cede issued a paper stock certificate and sent it to the custodial banks to hold. The custodial bank placed the stock in the name of their own nominee, and then notified Dell’s agent to record the nominee on the corporate ledger.

Laster said that there needed to be a different system that would have recognized the funds rights to appraisal, but as it lies Dell was in the right.

“Were it up to me, I would hold that the concept of a ‘stockholder of record’ includes the custodial banks and brokers,” he wrote.

Dell is not saying anything, but the move will have saved it a fortune.

Apple fails to get Samsung injunction

Apple’s attempts to get its rival banned from the US have failed.

After it convinced a jury that Samsung had nicked its glorious rounded rectangle, Apple had expected that Judge Lucy Koh would award it a permanent injunction against Samsung products in the US.

This is particularly since the jury ordered Samsung to write a cheque for a billion dollars.

However Koh, said no and killed off any chance that Apple has of winning the mobile patent wars.

Apple had convinced Koh to impose two pretrial sales bans against Samsung, one against the Galaxy Tab 10.1, and the other against the Galaxy Nexus phone.

After the trail it asked Koh to impose a permanent sales ban against 26 mostly older Samsung phones. The injunction could have been extended to Samsung’s newer Galaxy products.

But, according to Reuters,  one of the problems was that the jury cleared Samsung on the patent used to ban Galaxy Tab 10.1 sales, so Koh rescinded that injunction.

But what was more crucial was that a federal appeals court reversed Koh’s ban against the Nexus phone.

Koh cited the ruling as a binding legal precedent and said that Apple had not presented enough evidence that its patented features drove consumer demand for the entire iPhone.

She pointed out that the phones contain a range of features, only a small fraction of which are covered by Apple’s patents.

While Apple did have some interest in retaining certain features as exclusive to Apple, entire products can’t be banned from the market because they incorporate a few narrow protected functions.

However on the plus side for Apple, Koh rejected a bid by Samsung for a new trial based on an allegation that the jury foreman was improperly biased in favour of Apple.

The ruling leaves Apple’s cunning plan to patent troll its rivals from business rather than offering better products in a mess. To succeed in this plan it has to have products banned from the shelves to force Samsung either to pay ridiculous patent fees, or give up. 

US gears up for Huawei and ZTE ban

For a while now the US has been working out how to deal with the two Chinese telecommunications outfits that have been flogging their gear in the Land of the Fee.

There have been rumours that hardware made by Huawei and ZTE shipped with back doors which would enable Chinese spooks to listen in to the communications of decent American citizens as they order their Apple pies.

Apparently it is in the constitution as spying on US citizens is the preserve of American companies and anyway so far no back door has actually been found.

Now it seems that the US spooks have come up with another novel way of getting the cheap as chips Huawei and ZTE from winning contracts which would have gone to US companies.

The head of the US House of Representatives’ Intelligence Committee claims that the  companies are subsidised by the Chinese government.

Panel chairman Mike Rogers did repeat the line that there was a concern is whether any of their equipment or its software is designed to steal information or “establish the ability to do cyber attacks”.

But what seems to have really got his goat was that the gear is subsidised “so it can be multiple times cheaper than any local competitor.”

This could mean that the US could act to place tariffs on the imports of the products and thus make them less competitive.  This is exactly what the big US telecommunications industry lobby groups want, because it means that they have to do something like compete. 

Both companies deny getting Chinese subsidies and deny any suggestion that they are involved in espionage.

Rogers told Reuters that  ZTE and Huawei were a huge problem which will have to get a handle on it very quickly. He said that it might need legislation or new rules to guard US networks from possibly booby-trapped hardware or software.

He claimed that his committee’s coming report would help US companies considering buying equipment “to make the right decision and allow us to go forward with appropriate legislation as required”. The right decision, of course, would be to buy American.

Williams Plummer, a Huawei spokesman in Washington, said that Huawei has publicly and repeatedly and in a detailed fashion debunked this type of misinformation with solid facts. He could not understand why the US government continued to base its decisions on unsubstantiated and unclearly motivated statements. Clearly he has never read anything about the US approach to issues like evolution and stem cell research.

ZTE spokesman David Dai Shu said his company “receives no illegal or hidden subsidies, nor does it dump products in any markets where it operates”.

US government demands money from Megaupload users

The US government, which possibly illegally seized the data of millions of Megaupload customers, is now demanding that they pay to get it back.

US federal prosecutors say that they are fine with Megaupload users recovering their data as long as they pay for it.

According to a recent court filing, prosecutors have responded to an Electronic Frontier Foundation request in late March on behalf of Kyle Goodwin. Goodwin used Megaupload legitimately for storing videos.

US law allows for third parties who have an interest in forfeited property to make a claim. But the government argues that it only copied part of the Megaupload data and the physical servers were never taken.

Megaupload’s 1,103 servers are held by Carpathia Hosting, the government said.

But the government said that identifying, copying, and returning Goodwin’s data will be expensive, and Goodwin wants the government, or Megaupload, or Carpathia, or anyone other than himself, to bear the cost.

So what the government is saying is that while it is wrong for Megaupload to make money storing user data, it is ok for either it or Carpathia to do so.  While Kim Dotcom can be arrested for selling data storage to people, the US government can seize that data and sell it back to its victims at a high cost. 

What appears to be happening is that while the case against Megaupload is starting to unravel on procedural problems, the US government seems to want to continue to punish the company’s users, who will suffer even if Megaupload is never convicted. 

Facebook co-founder gives up US citizenship

Facebook co-founder Eduardo Saverin has renounced his US citizenship, according to an Internal Revenue Service report.

The announcement, days before the company’s initial public offering, is somewhat fishy.

According to Reutershis name appeared on an IRS notice that named people “who have chosen to expatriate.”

Facebook expects to make $10.6 billion in an IPO that is expected to value the company at as much as $96 billion.

If Saverin stayed in the Land of the Free he could be hit by a huge capital gains tax bill.

He has sold shedloads of his putative Facebook shares so that he does not appear in IPO filing documents. He is thought to have loads of putative shares, though.

Saverin has moved to Singapore, an Asian city state that has no capital gains tax. If he stayed in the US he would have faced a minimum 15 percent rate for long-term capital gains.

He is pretty multinational. Saverin was born in Brazil, and was educated in the United States at Harvard.

This whole US citizenship thing has become amusing in the Land of the Free lately. Former Republican Presidential candidate Michele Bachmann revealed she had become a dual US-Swiss citizen, then quickly tried to return her new Swiss passport.

It is not as easy as you think to give up US citizenship. It is a bit like one of those cults that does not let you go that easily. You have to signed oath an oath before a US diplomatic official and they will never let you back.  This means you have to suffer the same amount of abuse from Immigration officials when you enter the country as the rest of humanity.  As it is the only people that the US wants in their country are UK criminals.

On the other hand, you can easily give up your UK citizenship. At a price.

US House passes corporate-backed 'cyber security' bill

Attempts by the US House of Representatives to allow their big corporate friends to use the nation’s spooks to do their dirty work could get spiked by the president.

The House passed a cybersecurity bill that it thinks would allow the government and companies to share information about hacking.

The politicians claim that it means that economic cyber spies will have a harder time stealing American business plans and research and development.

In actual fact it allows federal agencies such as the National Security Agency to share secret cyber threat information with American companies to help the private sector protect its networks.

But the law is so broad that it will allow the NSA to effectively collect data on American communications by just asking corporates to hand it over.  We guess it also means that any data which spooks pick up in their spying efforts can be handed over the corporates.

House intelligence committee chairman Mike Rogers said that Facebook, the US Chamber of Commerce, Boeing, AT&T and others had supported it.

The legislation allows for information from private companies to be used for intelligence and national security purposes, not just cyber security.  After all Facebook is a champion for its users’ privacy.

But the White House is not happy with the law – saying that it would override “important provisions of electronic surveillance law without instituting corresponding privacy, confidentiality, and civil liberties safeguards”.

In a move which suggests that President Obama will veto the bill, the White House said that the bill would allow broad sharing of information with governmental entities without establishing requirements for both industry and the government to minimise and protect personally identifiable information.

The bill also gives big corporates immunity from privacy and antitrust lawsuits if they share threat information with the government and with corporate competitors.  As we said the law is so wide that it could be used to cover companies if it embarks on illegal wiretapping operations with US spooks.

But there are some aspects which the White House likes. It has provisions that would allow the Department of Homeland Security to direct companies maintaining critical infrastructure, such as water and power utilities, to meet new security standards.

The American Civil Liberties Union told Reuters that the bad out weighs the good in the bill. A spokesperson said that it would allow companies to share private information with the government without a warrant. 

US government wants to deny Megaupload a fair trial

The chances of Megaupload founder Kim DotCom getting a fair trial in the US appears remote.

The United States government is making it as difficult as possible for Megaupload to obtain legal advice in the Land of the Fee.

While the top law firm of Quinn Emanuel Urquhart and Sullivan has sought permission to represent Megaupload in the case, the government has refused.

The government’s argument is that DotCom should not be allowed to use money he has “stolen” from Big Content to pay for a fancy lawyer to get him off.

As Quinn Emanuel told the court that the government’s objections are so broad that they would effectively prevent Megaupload from hiring any lawyer with experience litigating major copyright cases and would make it impossible to hire any lawyer at all.

According to Ars Technica, the New Zealand courts have seen the sense of allowing Kim Dotcom to withdraw tens of thousands of dollars to cover his living expenses while they decide on his extradition case. But the US government is moaning that these funds give Kim Dotcom and Megaupload plenty of money to pay for legal representation.

It is fairly clear that the argument is that Kim Dotcom is guilty and will be forbidden to argue his case in the US.

Quinn Emanuel said that the New Zealand court specifically earmarked the money for living expenses, not legal fees. Dotcom’s case will require a lot of computer forensics, expert witnesses, and attorneys with in-depth copyright expertise.

But the government has other reasons for not wanting Quinn Emanuel. The firm has extensive experience handling copyright cases for some of the top names in Big Content. The government claims that this is a conflict of interest because its other customers are Megaupload’s victims.

In other words it is arguing before a Kiwi court that it is better for Dotcom to have no laywer than one which also has connections to the “victims”.

Quinn Emanuel points out this broad interpretation of conflict-of-interest rules would prevent Megaupload from retaining almost any law firm with experience in copyright matters, because all firms that specialise in copyright law regularly accept major content companies as clients.

The legal eagles say that Dotcom and Megaupload are willing to have Quinn Emanuel represent them so it is none of the US Government’s business.

However the US government has gone further. It says that because Dotcom is fighting his extradition, he counts as being a “fugitive from justice” and not entitled to be represented in US courts until the extradition fight is over.

Dotcom’s laywers point out that the US has that little thing called the constitution, yet, if the Government is to have its way in this case, the only lawyers before the Court will be those representing the Government and any evidence available to the Court would be that cherry-picked by the Government, for the Government. Other servers which show that Megaupload had a kosher business will be wiped by the government.

We would have thought that the New Zealand legal system would be interested to hear of how Dotcom will be treated in the US. After all the extradition process is supposed to only be allowed if the person is going to get a fair trial. It looks like the US government is doing its best to make sure Dotcom faces a Stalinist show trial. 

US plans to prosecute Julian Assange

The US government wants to arrest Julian Assange and has drawn up a secret charge sheet in the hope it can extradite him to face one of its finest kangaroo courts.

The email has been found in a confidential internal email obtained from private US intelligence company, Stratfor. Wikileaks recently began publishing leaked Stratfor emails, of which it claims it has 5 million.

In it, the company’s vice-president for intelligence, Fred Burton, was chatting about a media report concerning US investigations targeting WikiLeaks. He wrote: “We have a sealed indictment on Assange.”

The email was marked not for publication.

Burton is an expert on security and counter-terrorism with close ties to US intelligence and law enforcement agencies. He is a former chief of counterterrorism in the US State Department diplomatic security service.

WikiLeaks is releasing more than 5 million leaked Stratfor emails which it says show “how a private intelligence agency works, and how they target individuals for their corporate and government clients”.

The email shows that US prosecutors drew up a secret indictment against Mr Assange more than a year ago. At the moment he is awaiting a British Supreme Court decision on his appeal against extradition to Sweden to be questioned in relation to sexual assault allegations.

Assange claims that extradition to Stockholm will open the way for his extradition to the US on possible espionage or conspiracy charges. Cynics would suggest that getting Assange discredited by having him banged up on a sex charge in Sweden would be a lot easier to organise than a more politically damaging trial in the US.

US army private Bradley Manning was last week committed to face court martial for 22 alleged offences including ”aiding the enemy” by leaking classified US documents to WikiLeaks.  During that hearing, the comment was made that investigators had found a link between Assange and Manning.

What it looks like is a secret grand jury had been convened in Alexandria, Virginia. If he is charged under US law, it will most likely be the 1917 Espionage Act.

According to the Age,  Stratfor “senior watch officer” Chris Farnham, an Australian, advocated revoking Mr Assange’s Australian citizenship and made the sage comment: ”If I thought I could switch this dickhead off without getting done, I don’t think I’d have too much of a problem,” he said. 

Pirate Bay founders to be "jailed"

The Swedish Supreme Court has decided that it is not interested in hearing the appeal of the three founders of The Pirate Bay.

This means that the jail sentences and fines handed out to Peter Sunde, Fredrik Neij, Gottfrid Svartholm and Carl Lundström will stand.

In November 2010, the Swedish Court of Appeal found the three guilty of criminal copyright infringement offenses, although they did get their prison sentences decreased from the levels ordered at their original 2009 trial.

They were ordered to pay millions of dollars to the entertainment company plaintiffs.

Sunde will go to jail for eight months in prison. Neij will get 10 months and Lundström will be inside for four months. All will have to pay $6.8 million in damages.

A fourth defendant, Pirate Bay co-founder Gottfrid Svartholm, who was absent from the appeal hearings due to medical circumstances, missed the appeal hearing and will get a year in prison.

Lundström’s lawyer Per E Samuelsson told Torrent Freak he was disappointed that the court is so uninterested in dissecting and analysing the legal twists and turns of “one of the world’s most high-profile legal cases of all time”.

One of the defendants will appeal the case in the European Court of Justice. But this, however, won’t prevent the sentences from being carried out.

However, it does not mean that the Pirate Bay founders will be eating porridge and have to watch out bending over in the showers. It is common in the Swedish justice system to deduct 12 months from any prison sentence on cases over five years old. Since the case in question meets that criteria the Pirate Bay defendants would qualify.That is up to the court.

Ironically, The Pirate Bay remains online as it was not part of the legal proceedings. Apparently a few hours after the Supreme Court decision was made public, The Pirate Bay started redirecting to a .se domain, fearing a possible seizure from US cops.

Big Content is unlikely to get any cash, the founders are unlikely to be jailed, and the Pirate Bay still runs.  It does not look like anyone is a winner.