Supreme Court Won't Review US Government Getting To Steal All Of Kim Dotcom's Stuff

from the that's-unfortunate dept

While the "main event" in the never-ending case of the US Justice Department against Kim Dotcom continues to grind its way ever so slowly through the wheels of justice, one element has basically concluded. And this was the part that should concern you even if you think that Kim Dotcom was completely guilty of criminal copyright infringement. The issue here is that as part of the arrest of Dotcom and his colleagues, the US "seized" many of his assets. Now, when the government seizes assets, it's a temporary thing. They have a certain period of time to hold onto it. Afterwards, they either need to give those assets back or file a separate case to attempt to "forfeit" those items (i.e., keep them forever). Here's where things get a little bizarre. Because Dotcom was fighting extradition in New Zealand, the "deadline" for the US to continue holding the seized assets was approaching -- so they filed the separate case against his stuff. Because it's a civil asset forfeiture case, the case is literally against his stuff, and not against Kim Dotcom (and, yes, this is as weird and nonsensical as it sounds). But there was a twist: because Dotcom was still in New Zealand, the Justice Department said that he was a "fugitive" and thus couldn't even protest the forfeiture of his stuff. Unfortunately, both the district court and the appeals court agreed.

Again, let's be totally clear here -- because sometimes people get so focused on their belief that because Megaupload enabled copyright infringement that this is somehow okay. But here we have a situation where before anyone has been found guilty of anything, the US government was given permission to take and keep all of Kim Dotcom's stuff. This should concern you even if you think Dotcom deserves to rot in prison, because there's a clear absence of due process here. If Dotcom is eventually found to be not guilty -- that won't have any impact on this. The US government still gets to keep his stuff (or, well, whatever it can get its hands on).

So the issue here is not whether or not Kim Dotcom is guilty of copyright infringement. It's whether or not the US government can just take his stuff before that other process has played out. That's a problem.

And, unfortunately, it's a problem that the Supreme Court will not be reviewing at this time. Even as some of the Justices have expressed concerns about civil asset forfeiture, apparently they didn't want to take on this particular case. And, maybe that's okay, because maybe, as with many people, they wouldn't have been able to separate out the copyright question from the civil asset forfeiture question from the fugitive disentitlement question -- all of which are separate but important.

Filed Under: civil asset forfeiture, copyright, fugitive disentitlement, kim dotcom, scotus, supreme court
Companies: megaupload

How The Supreme Court's Continued Misunderstanding Of Copyright Ruined Halloween

from the costume-copyrights dept

Earlier this year we wrote about a truly awful Supreme Court ruling concerning whether or not the design of cheerleader costumes could be covered by copyright. As we had explained earlier, this ruling could have a major impact on a variety of industries. The key issue is that "useful articles" are not supposed to be subject to copyright. Historically, that's always meant that the actual design of clothing or costumes is not protected by copyright law. And that's been a really good thing. It's inspired much more competition and innovation over the years in the clothing world.

As we noted when the ruling came out, allowing the copyright on cheerleader uniforms to stand, with a weird "new test" (basically whether you can "separate" the design from the useful article, and if the separated design is copyright-eligible), would lead to a lot of lawsuits pushing the boundaries of that test. And that's exactly what's happening. And it may ruin Halloween this year. Because suddenly, Halloween costume designers are starting to sue. Specifically, a costume maker named (no joke) "Rasta Imposta" is suing K-mart for having the audacity to sell someone else's banana costume. Really. This is straight out of the complaint:

Incredibly, Rasta Imposta argues that basic features of a banana are its "distinct visual elements."

The appearance and trade dress of Rasta Imposta’s distinctive Banana Design is identified by a combination of arbitrary and distinct visual elements which make up its overall appearance, design, and trade dress, including, but not limited to the Banana Design’s bright yellow color with dark tips at the ends, the lines running down the sides, the Banana Design’s placement of the banana ends, and the cutout holes in the Banana Design.

I don't see how Rasta Imposta can legitimately argue that its copyright covers the yellow color of a banana, the dark tips or lines running down the side. That's kinda common to all bananas. But, still, it insists another banana is infringing.

The Kmart Totally Ghoul Costume has the same shape as the Banana Design, the ends of the banana are placed similarly, the vertical lines running down the middle of the banana are placed similarly, the one-piece costume is worn on the body the same way as the Banana Design, and the cut out holes are similar to the Banana Design.

And, no, I have no idea why Kmart has named its Banana costume "Totally Ghoul."

This whole thing seems particularly pointless. It's a freaking costume of a banana. But, alas, with the Supreme Court flinging open the door to pulling out elements of costumes and making them copyrightable, expect more of these lawsuits.

Filed Under: banana, copyright, costumes, halloween, scotus
Companies: kmart, rasta imposta

Patent Trolls' Favorite Judge Comes Up With Test To Keep Patent Cases In East Texas, No Matter What SCOTUS Said

from the take-that-scotus dept

We've written a few times about Judge Rodney Gilstrap, an East Texas federal district court judge, whom patent trolls seem to love. For well over a decade, we've discussed how patent trolls absolutely love to file cases in East Texas, and in the past few years, Gilstrap has basically been the judge for patent cases in East Texas. Incredibly, in 2016, Gilstrap alone handled 20% of all patent cases in the country (that was true in earlier years as well). Not 20% of the patent cases filed in East Texas -- but in the whole country. And if you read that link, you see that Gilstrap seems (a) proud of this and (b) insists that people are upset about all the patent cases going to East Texas because they don't like small-town America -- and not because the court makes it that much easier for trolls to shake down everyone.

Now, as you may recall, the Supreme Court, just a few months ago, appeared to slam the door shut on patent troll venue shopping with its ruling in the TC Heartland case. In that case, the Supreme Court ruled that patent law is pretty clear, that you need to sue where the supposed infringer "resides." For years, the courts had ignored this -- despite it being plainly stated in the law -- and said that you could file a lawsuit wherever a company did any business (and with many companies, that means anywhere at all).

Many folks suggested that the SCOTUS TC Heartland ruling should put a real damper on patent trolls running to Judge Gilstrap and East Texas.

However, it appears that Gilstrap may have other ideas. Ryley Bennett, from the Washington Legal Foundation, recently wrote up a depressing article about how Gilstrap appears to have come up with a new "test" for patent venue that more or less wipes out the Supreme Court's ruling. The case was a patent infringement case where Raytheon sued Cray in East Texas. Cray argued for a change of venue, which Gilstrap denied (just a month before the SCOTUS ruling on TC Heartland), pointing to a sale Cray had made in East Texas. So after TC Heartland, Cray asked Gilstrap to reconsider with that new precedent. And here, Gilstrap single-handedly created a new "test" about what is meant by "resides" in, making it possible to keep many cases in East Texas. The key here was that Cray had a single sales person who worked from home in the Eastern District of Texas. And, to Gilstrap, that's enough to establish "residence."

Bennett explains why this is so problematic:

According to Judge Gilstrap, to demonstrate that a defendant maintains a regular and established place of business, there does not have to be a physical presence or place at all—that’s just a persuasive factor for the court to consider. Inventory, under this analysis, is persuasive in finding a regular and established place of business. Thus, under Judge Gilstrap’s interpretation, a plaintiff can secure its venue of choice by using downstream targets. Even when a corporation does not have property in the EDTX, under this test, if the corporation has remote (work-from-home) employees—who are reimbursed for business expenses such as cell phone and internet use, along with travel reimbursement—it can be subject to venue in a district where any of its remote employees resides.

Further, under Judge Gilstrap’s second factor, a defendant’s “representations” can be a mere advertisement about what the company does or where it is located, even if the company is located in a different state. Ironically, although Judge Gilstrap repeatedly stated that the business world has changed since the adoption of § 1400 and it should be adjusted accordingly, he cited a 1910 decision when stating that customer inquiries directed at an agent who happens to be in the EDTX should be considered persuasive when determining if there is a regular and established place of business there.

Judge Gilstrap’s third factor—benefits received—is not limited to sales revenues; rather, any benefit that the defendant derives from presence in the EDTX should be considered. Does this mean that a happenstance conversation in a restaurant with a person who then becomes a customer outweighs other factors and gives rise to a regular and established place of business? Under Judge Gilstrap’s third factor of his test, it does.

In explaining the final factor—targeted interactions—Judge Gilstrap cited a Sixth Circuit personal jurisdiction case as support that existing or potential customers, customer support, or targeted marketing efforts give rise to a regular and established place of business—the same type of personal jurisdiction considerations that the Supreme Court in TC Heartland said did not apply to venue determinations.

Because of all of this, Bennett notes that the new "test" feels an awful lot like the old rules that the Supreme Court just threw out. Not surprisingly, Cray immediately asked the appeals court to weigh in on the issue, while Raytheon has asked to leave Gilstrap's ruling in place. As it stands, CAFC is still reviewing the issue, and various parties are lining up filing amicus briefs urging the court one way or the other.

However, it does at least give the appearance of a highly criticized East Texas court judge effectively stacking the deck with this test in a manner that will allow him to ignore the clear spirit and substance of a Supreme Court ruling, in an effort to keep the patent troll case train to keep dumping cases at his courtroom doorstep.

Filed Under: east texas, patent trolls, patents, rodney gilstrap, scotus, supreme court, venue, venue shopping
Companies: cray, raytheon, tc heartland

Supreme Court Has Another Chance To Help Take Down The Patent Trolls

from the help-us-scotus dept

The Supreme Court has a chance to help banish patent trolls back under the bridge where they belong. In the fall session, the Court will hear Oil States Energy Service v. Greene's Energy Group – a case that has massive implications for the future of patent law and U.S. innovation.

Patent trolls (sometimes called non-practicing entities, or NPEs) don't actively create any goods or provide any services. Instead, they go after those who do, filing bogus patent infringement lawsuits. Ultimately, their goal is to frighten businesses into settling outside of court, collecting as much money as they can.

More than 80 percent of trolls' victims are small and medium-sized businesses, and the cost to defendants to fight a patent-infringement lawsuit can easily reach $1 million. That's why it's often more cost-effective to simply pay off the trolls.

"Trolls often aggressively push for extortionate settlements that far surpass the value of the [intellectual property] because they know many companies will choose to settle, rather than get embroiled in an expensive and drawn-out lawsuit," Ira Blumberg, a former patent-troll lawyer, explained: "Their actions can wreak havoc on tech companies of all sizes."

Patent trolls cost the U.S. economy $80 billion each year, or about $1.5 billion a week. The billions of dollars wasted in this way are funds that can't be invested in research and development or in hiring the innovative talent needed to develop new products and grow the U.S. economy. In fact, a Harvard Business School study found that companies that settle with or lose to trolls lower the amount of money they invest in R&D by 25 percent on average.

Fortunately, there's a way to help thwart the trolls, provided the Supreme Court upholds the ruling of the Federal Circuit Court in Oil States Energy Service v. Greene's Energy Group. The case involves inter-partes review (or IPR) – the process used by the U.S. Patent and Trade Office to determine whether a patent under question was issued based on merit. If not, the patent can be rescinded. The process is similar to a trial: Lawyers make their case to the Patent Trials and Appeals Board (PTAB), and three highly qualified administrative patent judges hear their case and come to a decision.

This process is expensive, but it's considerably less costly than going to court. Startups and small businesses cannot afford the millions that a patent lawsuit costs, but some of them can afford to challenge a bad patent via an IPR proceeding. If the Supreme Court fails to uphold the Federal Circuit Court's ruling, American small businesses would no longer have an accessible avenue to challenge dubious patents.

The PTAB has a solid track record of fair rulings. A troll might take the case to the Federal Circuit after not getting the result they hoped for in an IPR, but the court rarely reverses the PTAB's ruling. A study from Law360 looked at Federal Circuit appeals in 2016, and found that the court affirmed 75 percent of the decisions made by the PTAB and overturned just three percent. (The other 22 percent were remanded back to the PTAB).

Oil States Energy Service, a multinational oil and gas company, however, wants to end IPR and hand decisions about patents back to the courts, arguing that IPR is unconstitutional and that these cases should only be heard in a court of law with a citizen jury. If the Supreme Court decides in Oil States' favor, trolls will be able to continue extorting small businesses and those businesses will have no realistic way to fight back. That means that American entrepreneurs will be forced to waste money on frivolous troll lawsuits rather than investing in R&D and creating jobs.

Earlier this year, the Supreme Court cut off one avenue that trolls use to shake down innovators by requiring that patent cases be brought in the court where the defendant is located. This should discourage trolls from concentrating cases in favorable venues like the Eastern District of Texas. The decision was a significant step in the right direction. The Supreme Court should again rule in favor of entrepreneurs in the Oil States case.

Despite the court's focus on patent issues, however, Congress must ultimately take a stand and act to strengthen our patent system to stop trolls for good. The House passed legislation in 2013 that would help prevent patent trolls from continuing to harass companies, but the bill died in the Senate. Since then, the problem, already bad, has only worsened: Patent troll suits have spiked 500 percent over the last ten years, and 2015 was the second-highest year on record for patent lawsuits, with trolls making up 66.9 percent of suits. Every delay allows the problem to grow and prevents tech companies from investing their money in creating jobs and innovation.

The tech industry accounts for seven percent of the U.S. GDP and supports 6.7 million U.S. jobs, but trolls continue to slow innovation with frivolous lawsuits. The Supreme Court should take advantage of this remarkable opportunity to challenge the trolls and defend American ingenuity by upholding IPRs. Our innovation economy depends on it.

Gary Shapiro is president and CEO of the Consumer Technology Association (CTA), the U.S. trade association representing more than 2,200 consumer technology companies, and author of the New York Times best-selling books, Ninja Innovation: The Ten Killer Strategies of the World's Most Successful Businesses and The Comeback: How Innovation Will Restore the American Dream. His views are his own. Connect with him on Twitter: @GaryShapiro

Filed Under: inter partes review, ipr, patent trolls, patents, scotus, supreme court
Companies: greene's energy group, oil states energy

As Predicted, Cox's Latest Appeal Points To SCOTUS' Refusal To Disconnect Sex Offenders From Social Media

from the which-is-worse? dept

Last week the Supreme Court managed to hold its nose long enough to properly assert that banning convicted sex offenders from social media was plainly an infringement on their First Amendment rights. While much of the media coverage focused on the question of sex offenders having access to these well-trafficked websites, the real implications of the ruling were always likely to be far more reaching. We specifically pointed to the reasonable question: if sex offenders can't be blocked from internet sites due to their First Amendment rights, how can we possibly require ISPs to disconnect those accused of piracy from the internet under even the most tortured reading of 512(i) of the DMCA? In that original post, Mike wrote:

I expect that to be quoted in many other cases -- and a big one may be the ongoing attempts right now by the legacy entertainment industry to force ISPs to kick people off of their service based on accusations (not convictions) of infringement. Those cases, like this Packingham case, involve using a law to claim that people should be blocked from using the internet. And based on the quotes above, it seems quite likely that parts of the DMCA are clearly unconstitutional. The lawsuits -- mainly the BMG v. Cox ruling which is currently on appeal, and the more recent UMG v. Grande Communications (which follows the same basic outlines of the Cox case) -- involve arguing that 512(i) of the DMCA requires ISPs to kick users off their service entirely based on accusations of infringement. As we've explained, this already appears to be a twisted interpretation of 512(i), but now it appears there's a very reasonable chance that the Supreme Court could find 512(i) outright unconstitutional under the First Amendment for broadly blocking internet access in a way that harms free speech rights.

It appears we're starting down the road of finding out exactly what the court's answer to this question will be, as Cox recently filed an appeal and has now referenced the SCOTUS decision in its written arguments.

Packingham is directly relevant to what constitute ‘appropriate circumstances’ to terminate Internet access to Cox’s customers. The decision emphatically establishes the centrality of Internet access to protected First Amendment activity.

As the Court recognized, Internet sources are often ‘the principal sources for knowing current events, checking ads for employment, speaking and listening in the modern public square, and otherwise exploring the vast realms of human thought and knowledge’.

The filing goes on to note that the government is not allowed to infringe on free speech in order to prohibit unlawful speech. If ever there were an example of that very thing, it certainly would be accused pirates being disconnected from what has now been cited as a speech medium in the internet. I'm genuinely looking forward to hearing oral arguments from the legal staff of the movie and record labels that those accused of piracy, typically on flimsy at best evidence, ought to be afforded less rights than convicted sex offenders. We've seen much demonizing of the internet in general and piracy in particular, but I'm having a hard time conjuring up the images of those lawyers managing to go that far. That's an argument that's going to need to be made, however, given the contention of Cox's latest filing.

And if it offends the Constitution to cut off a portion of Internet access to convicted criminals, then the district court’s erroneous interpretation of Section 512(i) of the DMCA — which effectively invokes the state’s coercive power to require ISPs to terminate all Internet access to merely accused infringers — cannot stand.

A win for Cox would mean much for the free speech rights of everyone in regards to internet access. A loss would mean this country's court system has some seriously skewed priorities for who should and should not be allowed access to the web.

Filed Under: copyright, disconnection, dmca, first amendment, free speech, internet access, packingham, rights, scotus
Companies: bmg, cox, rightscorp

Supreme Court Says You Can't Ban People From The Internet, No Matter What They've Done

from the good-to-see dept

Going all the way back to 2002 (and many times after that), we've talked about courts struggling with whether or not it's okay to ban people from the internet after they've committed a crime. The question comes up in many different cases, but most prevalently in cases involving child predators. While courts have struggled with this issue for so long, it's only now that the Supreme Court has weighed in and said you cannot ban someone from the internet, even if they're convicted of horrific crimes -- in this case, sex crimes against a minor. The case is Packingham v. North Carolina, and the Supreme Court had to determine if it violated the First Amendment's free speech clause and the Fourteenth Amendment's due process clause, to make it a felony for convicted sex offenders to visit social media sites like Facebook and Twitter, as was the case under a North Carolina law.

In this case, Lester Packingham is a convicted sex offender for an event that happened back in 2002. In 2010, he went on Facebook to brag about getting a traffic ticket dismissed -- using his middle name as his last name. A local police officer saw the post and connected the dots to figure out that the poster "J.R. Gerard" was actually Lester Gerard Packingham and charged him with violating that NC law on using social media as a sex offender. Various state courts went back and forth with the NC Supreme Court eventually saying that the law was "constitutional in all respects." The Supreme Court of the United States, however, did not agree.

The ruling is interesting on a number of levels. It cites, pretty directly, EFF's amicus brief, noting just how important and central to our lives sites like Facebook have become.

While in the past there may have been difficulty in identifying the most important places (in a spatial sense) for the exchange of views, today the answer is clear. It is cyberspace—the “vast democratic forums of the Internet” in general, Reno v. American Civil Liberties Union, 521 U. S. 844, 868 (1997), and social media in particular. Seven in ten American adults use at least one Internet social networking service. Brief for Electronic Frontier Foundation et al. as Amici Curiae 5–6. One of the most popular of these sites is Facebook, the site used by petitioner leading to his conviction in this case. According to sources cited to the Court in this case, Facebook has 1.79 billion active users. Id., at 6. This is about three times the population of North America.

Social media offers “relatively unlimited, low-cost capacity for communication of all kinds.” Reno, supra, at 870. On Facebook, for example, users can debate religion and politics with their friends and neighbors or share vacation photos. On LinkedIn, users can look for work, advertise for employees, or review tips on entrepreneurship. And on Twitter, users can petition their elected representatives and otherwise engage with them in a direct manner. Indeed, Governors in all 50 States and almost every Member of Congress have set up accounts for this purpose. See Brief for Electronic Frontier Foundation 15–16. In short, social media users employ these websites to engage in a wide array of protected First Amendment activity on topics “as diverse as human thought.”

The opinion, written by Justice Kennedy, notes that the internet is a vast and changing place, and notes that the court does need to proceed with caution -- but that caution must be in the direction of protecting Constitutional rights:

This case is one of the first this Court has taken to address the relationship between the First Amendmentand the modern Internet. As a result, the Court must exercise extreme caution before suggesting that the FirstAmendment provides scant protection for access to vast networks in that medium.

And then, the opinion dives right in and says that the law is obviously a violation of the First Amendment for not being "narrowly tailored." Again, while there are a few limited exceptions to the First Amendment, they are very narrowly tailored and the Supreme Court has shown little to no interest in expanding them:

Even making the assumption that the statute is content neutral and thus subject to intermediate scrutiny, the provision cannot stand. In order to survive intermediate scrutiny, a law must be “narrowly tailored to serve a significant governmental interest.” ... In other words, the law must not “burden substantially more speech than is necessary to further the government’s legitimate interests.” ...

And this law is not, at all, narrowly tailored. Once again, SCOTUS leans heavily on EFF's amicus brief to point out how overly broad this NC law is:

It is necessary to make two assumptions to resolve this case. First, given the broad wording of the North Carolina statute at issue, it might well bar access not only to commonplace social media websites but also to websites as varied as Amazon.com, Washingtonpost.com, and Webmd.com. See post, at 6–9; see also Brief for Electronic Frontier Foundation 24–27; Brief for Cato Institute et al. as Amici Curiae 10–12, and n. 6. The Court need not decide the precise scope of the statute. It is enough to assume that the law applies (as the State concedes it does) to social networking sites “as commonly understood”—that is, websites like Facebook, LinkedIn, and Twitter....

From there, it notes that clearly a state could bar more specific and narrowly tailored actions that are not broadly targeting speech:

Second, this opinion should not be interpreted as barring a State from enacting more specific laws than the one at issue. Specific criminal acts are not protected speech even if speech is the means for their commission.... Though the issue is not before the Court, it can be assumed that the First Amendment permits a State to enact specific, narrowly tailored laws that prohibit a sex offender from engaging in conduct that often presages a sexual crime, like contacting a minor or using a website to gather information about a minor.

But this law obviously goes way beyond that, and the Court is troubled by this, calling it "unprecedented in the scope of First Amendment speech it burdens."

Even with these assumptions about the scope of the law and the State’s interest, the statute here enacts a prohibition unprecedented in the scope of First Amendment speech it burdens. Social media allows users to gain access to information and communicate with one another about it on any subject that might come to mind.... By prohibiting sex offenders from using those websites, North Carolina with one broad stroke bars access to what for many are the principal sources for knowing current events, checking ads for employment, speaking and listening in the modern public square, and otherwise exploring the vast realms of human thought and knowledge. These websites can provide perhaps the most powerful mechanisms available to a private citizen to make his or her voice heard. They allow a person with anInternet connection to “become a town crier with a voice that resonates farther than it could from any soapbox."...

In sum, to foreclose access to social media altogether is to prevent the user from engaging in the legitimate exercise of First Amendment rights. It is unsettling to suggest that only a limited set of websites can be used even by persons who have completed their sentences. Even convicted criminals—and in some instances especially convicted criminals—might receive legitimate benefits from these means for access to the world of ideas, in particular if they seek to reform and to pursue lawful and rewarding lives.

The above part is the key part of this ruling, and I fully expect it to be cited repeatedly in future cases. It's the Supreme Court declaring, quite clearly, that the ability to use the internet is vital to being a part of society today, and thus there's a fundamental First Amendment right to be able to do so.

Three Justices -- Alito, Roberts and Thomas -- concur with the overall opinion, but do take some issue with the expansive nature of Kennedy's opinion, suggesting it goes too far. In the concurrence, written by Alito, they note:

I cannot join the opinion of the Court, however, because of its undisciplined dicta. The Court is unable to resist musings that seem to equate the entirety of the internet with public streets and parks.... And this language is bound to be interpreted by some to mean that the States are largely powerless to restrict even the most dangerous sexual predators from visiting any internet sites, including, for example, teenage dating sites and sites designed to permit minors to discuss personal problems with their peers. I am troubled by the implications of the Court’s unnecessary rhetoric.

I don't see how they can read the majority opinion to say that. Kennedy's opinion makes it quite clear that such things can be restricted where it's clear that these actions are narrowly targeted at situations that "often presages a sexual crime." Either way, I get the feeling that, despite these concerns, this case will be cited in useful ways to protect free speech in the future...

Filed Under: first amendment, free speech, internet, lester packingham, north carolina, packingham, public square, scotus, supreme court

Supreme Court Makes It Even More Difficult To Sue Federal Officials Over Rights Violations

from the BUILD-THAT-WALL dept

If you wanted even more leeway for government officials to bypass accountability, you've got it. Courtesy of the US Supreme Court, the immunity for federal officials has just been expanded. On a day when the court handed down two significant First Amendment victories, the court has dialed back an avenue of redress for people whose rights have been violated by federal employees.

This case has its origins in the 2001 Twin Towers attack. In the wake of the attack, the government engaged in some questionable behavior (not unlike some of its World War II actions), rounding up undocumented Arab immigrants and detaining them under harsh conditions.

When they were finally released, they sued the US government for violating their rights. Unfortunately, options for directly suing federal officers are severely limited. Up until the Supreme Court's 1971 Bivens decision, plaintiffs had almost no way to seek redress for rights violated by federal employees. Bivens produced a new option, but its limited scope still made it very difficult for plaintiffs to secure a ruling in their favor. It's especially useless in cases like the one before the Supreme Court -- a case where the plaintiffs have no other way to bring a suit against the government other than going the Bivens route, thanks to their status as undocumented aliens at the time the rights violations allegedly occurred.

This new decision limits Bivens even further by adding national security concerns to the mix. In cases like these -- prompted by federal government reactions to a domestic terrorist attack -- the Supreme Court comes down on the side of the US government. But it's not just national security playing a limiting factor in seeking justice for violated rights. It's pretty much any case where the government hasn't seen this particular sort of violation before.

Cornell law prof Michael Dorf points out how severely restricting this ruling is for plaintiffs who have a single recourse option available to them:

The key move in the majority opinion is one of characterization. The Court says that it is not enough for a Bivens action to be available that there are precedents in the same general area holding that no "special factors" warrant denial of a Bivens action; the "special factors" must be evaluated by reference to a highly particularized description of the case at hand. How particularlized? The Court says:

Without endeavoring to create an exhaustive list of differences that are meaningful enough to make a given context a new one, some examples might prove instructive. A case might differ in a meaningful way because of the rank of the officers involved; the constitutional right at issue; the generality or specificity of the official action; the extent of judicial guidance as to how an officer should respond to the problem or emergency to be confronted; the statutory or other legal mandate under which the officer was operating; the risk of disruptive intrusion by the Judiciary into the functioning of other branches; or the presence of potential special factors that previous Bivens cases did not consider.

The shorthand version is the same excuse used in tons of normal, non-Bivens civil rights cases: if the court hasn't previously ruled on this specific set of circumstances before (and judged them to be a violation of rights), qualified immunity for government employees will be upheld. The problem is violations must be "clearly established" by a court decision to bypass immunity -- which is an extreme rarity in a system that heavily relies on precedent, frequently punts on tough legal questions, and often tells plaintiffs their redress is tied to legislation Congress has yet to write, much less pass.

Mix in national security concerns, "special considerations," and expansive immunity protections for government employees and this decision demands future Bivens petitioners do the impossible:

That means that it is now possible for a federal officer to violate clearly established rights--i.e., to commit rights violations that are established as clear in virtue of being very similar to rights violations that were adjudicated in prior cases--but still not be subject to a Bivens action because the case is nonetheless too different from prior Bivens cases to overcome the "special factors" limitation.

To bring a successful Bivens action a civil rights plaintiff must now pass through the eye of a tiny needle inside the eye of another tiny needle.

The decision [PDF] also suggests plaintiffs just wait around with their rights violated until Congress does something about it:

The proper balance in situations like this, between deterring constitutional violations and freeing high officials to make the lawful decisions necessary to protect the Nation in times of great peril, is one for the Congress to undertake, not the Judiciary.

What remains after this decision is almost nothing for plaintiffs -- like the Muslims and Arabs rounded up in a legally-unsound reaction to a terrorist attack -- and another expansion of immunity protections for federal officers and officials. As Steve Vladeck pointed out on Twitter, future Bivens cases will be limited to a small subset of prior Bivens decisions. The chances of previous decisions being perfectly applicable to the facts at hand in future cases hovers right around 0%. In the context of this case, it means the government can again engage in such a roundup of Muslims and Arabs without worrying about future lawsuits. None of the courts involved declared this roundup to be a violation of rights, so as far as the judiciary is concerned, similar actions won't violate any established precedent.

Plaintiffs bringing these complaints -- plaintiffs who often have no other options under the law -- will have to be willing to spend lots of time and money pursuing miracles. The Supreme Court has ruled that if it walks like a duck, acts like a duck, but quacks a bit more like a Canvasback than a Mallard, federal immunity will be upheld..

Filed Under: bivens, civil liberties, civil rights, rights violations, scotus, sue government officials, supreme court

Supreme Court Won't Hear Dancing Baby Case... Despite Gov't Admitting 'Serious Legal Error'

from the dancing-without-end dept

Sometimes I think purgatory must be filing a lawsuit over a wrongful DMCA takedown notice. I'm pretty sure that's how Stephanie Lenz feels. After all, she's been fighting against Universal Music issuing a bogus DMCA takedown against her dancing baby, and I'm pretty sure that "baby" will be graduating high school before too long. Last we'd checked in, the Supreme Court was debating hearing the appeal in the case, and had asked the White House to weigh in. The White House responded last month with a truly bizarre argument, agreeing that the 9th Circuit's ruling contained a "significant legal error" but said that this case was "not a suitable vehicle for correcting that mistake."

Whether it was for that reason or for no reason at all, the Supreme Court has now decided not to hear the appeal, meaning that the case is back (once again) in District Court, where it may actually go to trial to determine if Universal Music knew that the video was fair use when it issued the initial takedown.

As we've discussed time and time again, this particular case is an important one, if Section 512(f) of the DMCA -- the part that says you cannot file bogus DMCA takedowns -- is to have any teeth. The problem, right now is that there are piles upon piles of abusive DMCA takedowns, targeting all sorts of content that is perfectly legitimate and non-infringing. Yet, because there is basically no punishment for issuing such takedowns, they continue. Unfortunately, this particular case keeps coming out with "mixed bag" rulings that probably won't help very much in the long term. While we may have hoped that the Supreme Court would clear things up and make sure 512(f) actually does its job, it appears that's unlikely to happen any time soon.

Filed Under: 512(f), copyright, dancing baby, dmca 512, fair use, scotus, stephanie lenz, supreme court
Companies: umg

Supreme Court Reminds US Government That Hate Speech Is, In Fact, Free Speech

from the you-may-not-like-it,-but... dept

We've written a few times now about the case involving the band "The Slants" and their fight against the US Patent and Trademark Office concerning whether or not the band could trademark its own name (and, yes, this case is indirectly tied to the fight over whether or not the Washington Redskins can keep its team name trademarked). The key issue is a part of trademark law -- §1052(a) -- that says that the USPTO can deny trademarks if they "disparage... or bring into contempt or disrepute... persons, living or dead." When we first came across this case, a few years back, I argued that this clause did not violate the First Amendment. My argument, originally, was that a failure to grant a trademark was not restricting speech in any way (in fact, it was the opposite -- it was allowing more speech, since the registered trademark could no longer be used to block the speech of others).

But the issue is a tricky one, and after thinking about it more, reading much more and talking to a number of lawyers, my position shifted. And the hinge on which it shifted was this: the problem with 1052(a) was that it involved the government determining whether it "blessed" something with a trademark based on the content. And that, right there, has always been seen as a problem for the First Amendment. The government should not be making any subjective decisions based on expression -- and, yet, under 1052(a) it was. And now... the Supreme Court has agreed with that view and has struck down 15 USC 1052(a) as unconstitutional under the First Amendment, which makes this a big win for the First Amendment. And, on top of that, the Court went so far as to state upfront that a favorite claim of lots of angry people (on all sides of the political spectrum) these days -- that "hate speech" is somehow not "free speech" -- is simply untrue. The full ruling is 39 pages, which includes different Justices agreeing on some parts and not others, and writing separate concurring opinions -- but the overall point is clear. The court notes that the government, itself, is protected by the First Amendment and can take its own viewpoint on things, but this is different, because it's not content created by the government:

At issue here is the content of trademarks that are registered by the PTO, an arm of the Federal Government. The Federal Government does not dream up these marks, and it does not edit marks submitted for registration. Except as required by the statute involved here, 15 U. S. C. §1052(a), an examiner may not reject a mark based on the viewpoint that it appears to express. Thus, unless that section is thought to apply, an examiner does not inquire whether any viewpoint conveyed by a mark is consistent with Government policy or whether any such viewpoint is consistent with that expressed by other marks already on the principal register. Instead, if the mark meets the Lanham Act’s viewpoint-neutral requirements, registration is mandatory.

Thus, there is no legitimate argument that barring the government from rejecting trademarks for disparagement violates the government's own First Amendment rights.

Then, there's the question of whether this is denying someone a benefit based on their constitutionally protected expression. The PTO pointed to a few other cases involving government subsidies, which has said the government can deny subsidies over activities it does not wish to promote. However, the Court rejects the PTO's argument here fairly simply, saying that registering a trademark is quite different than getting a subsidy.

The PTO also argues that this issue deserves less First Amendment scrutiny because -- by definition -- trademarks involve commercial speech. But the Court rejects that and makes its most forceful statement in support of free speech -- even when hateful. It's this part of the ruling that seems likely to be quoted in many free speech cases in the future concerning hateful speech:

But no matter how the point is phrased, its unmistakable thrust is this: The Government has an interest in preventing speech expressing ideas that offend. And, as we have explained, that idea strikes at the heart of the First Amendment. Speech that demeans on the basis of race, ethnicity, gender, religion, age, disability, or any other similar ground is hateful; but the proudest boast of our free speech jurisprudence is that we protect the freedom to express “the thought that we hate.”

Yes. Demeaning speech is hateful. Yes, hateful speech is generally a bad thing. But, no, we don't block it because the First Amendment strongly protects all such speech, out of a fear that opening up that door will allow in censorship of merely controversial ideas.

And the Supreme Court then also makes another important point, that if you allow the First Amendment to be chipped away on "commercial speech" like this, you create all sorts of other problems:

There is also a deeper problem with the argument that commercial speech may be cleansed of any expression likely to cause offense. The commercial market is well stocked with merchandise that disparages prominent figures and groups, and the line between commercial and non-commercial speech is not always clear, as this case illustrates. If affixing the commercial label permits the suppression of any speech that may lead to political or social “volatility,” free speech would be endangered.

You need to protect the speech you dislike because the speech you may like may be disliked by others.

In the end, this is a good win for the First Amendment and for free speech.

Filed Under: 1st amendment, disparagement, first amendment, free speech, hate speech, scotus, supreme court, the slants, trademark, uspto

Supreme Court Sees Criminal Asset Forfeiture Can Be Abused Too; Almost Does Something About It

from the have-a-bandaid dept

Recently, the Supreme Court passed on a case that could have seen it address the highly-problematic civil asset forfeiture issue head on. In that case, cops seized $201,000 (and a bill of sale for a home) from two people during a traffic stop. Despite having no evidence of criminal activity, the cops kept the $201,000 and claimed it was the result of narcotics trafficking. And, despite this claim, law enforcement never arrested the couple it took the money from and charges were never brought.

The Supreme Court refused to touch the appeal, choosing to let the lower courts' rulings stand (and the officers keep the $201,000). Justice Clarence Thomas had a problem with the Supreme Court letting this case slide, writing that the civil asset forfeiture system is easily-abused and provides the worst of incentives.

I am skeptical that this historical practice is capable of sustaining, as a constitutional matter, the contours of modern practice, for two reasons.

First, historical forfeiture laws were narrower in most respects than modern ones.... Most obviously, they were limited to a few specific subject matters, such as customs and piracy. Proceeding in rem in those cases was often justified by necessity, because the party responsible for the crime was frequently located overseas and thus beyond the personal jurisdiction of United States courts.... These laws were also narrower with respect to the type of property they encompassed. For example, they typically covered only the instrumentalities of the crime (such as the vessel used to transport the goods), not the derivative proceeds of the crime (such as property purchased with money from the sale of the illegal goods)....

Second, it is unclear whether courts historically permitted forfeiture actions to proceed civilly in all respects. Some of this Court’s early cases suggested that forfeiture actions were in the nature of criminal proceedings... Whether forfeiture is characterized as civil or criminal carries important implications for a variety of procedural protections, including the right to a jury trial and the proper standard of proof. Indeed, as relevant in this case, there is some evidence that the government was historically required to prove its case beyond a reasonable doubt....

This alone doesn't do anything useful, other than signal at least one justice wants to take a swing at civil asset forfeiture. The Supreme Court, however, did choose to examine another form of forfeiture, this one related to actual criminal charges and convictions.

The question before the court was this: is is legally-acceptable to attempt to recover illicitly-obtained profits from someone who didn't directly profit from the illicit activity? The government (of course) argued "yes." The court isn't so sure. Here's the background, from the Court's synopsis of its opinion [PDF]:

Terry Honeycutt managed sales and inventory for a Tennessee hardware store owned by his brother, Tony Honeycutt. After they were indicted for federal drug crimes including conspiracy to distribute a product used in methamphetamine production, the Government sought judgments against each brother in the amount of $269,751.98 pursuant to the Comprehensive Forfeiture Act of 1984, which mandates forfeiture of “any property constituting, or derived from, any proceeds the person obtained, directly or indirectly, as the result of” certain drug crimes, 21 U. S. C. §853(a)(1). Tony pleaded guilty and agreed to forfeit $200,000. Terry went to trial and was convicted. Despite conceding that Terry had no controlling interest in the store and did not stand to benefit personally from the sales of the product, the Government asked the District Court to hold him jointly and severally liable for the profits from the illegal sales and sought a judgment of $69,751.98, the outstanding conspiracy profits.

The district court said Terry was just a salaried employee who did not directly benefit from the profits of the sale of an item used in crystal meth manufacturing. The appeals court decided Terry was just as culpable as the store's owner. The Supreme Court sides with the district court.

Because forfeiture pursuant to §853(a)(1) is limited to property the defendant himself actually acquired as the result of the crime, that provision does not permit forfeiture with regard to Terry Honeycutt, who had no ownership interest in his brother’s store and did not personally benefit from the illegal sales.

This is a solid determination, as far as it goes. This only deals with criminal asset forfeiture, which isn't abused nearly as much as the civil side, thanks to the government actually having to build a solid criminal case before it can permanently acquire other people's property.

But it's also a question of semantics. As Scott Greenfield points out in this post, the opinion focuses on the wording of the statute as applied to this particular case, which doesn't exactly make this blanket coverage for all similar cases. The Court presents a hypothetical situation that makes it appear it's headed down the blanket coverage path…

An example is instructive. Suppose a farmer masterminds a scheme to grow, harvest, and distribute marijuana on local college campuses. The mastermind recruits a college student to deliver packages and pays the student $300 each month from the distribution proceeds for his services. In one year, the mastermind earns $3 million.The student, meanwhile, earns $3,600. If joint and several liability applied, the student would face a forfeiture judgment for the entire amount of the conspiracy’s proceeds: $3 million. The student would be bound by that judgment even though he never personally acquired any proceeds beyond the $3,600. This case requires determination whether this form of liability is permitted under§853(a)(1). The Court holds that it is not.

As Greenfield points out, this would shift jurisprudence to substantially alter the way the government seeks restitution through criminal asset forfeiture. But the Court doesn't limit itself to the contours of its own hypothetical. Instead, it spends too much time circling the semantic drain.

Despite the example given, which has broad if not universal application limiting the culpability and liability to the actual conduct, the actual profit, perhaps even the actual knowledge of that college student who got $300 per month to play the mule, the holding relies primarily on the word “obtained.” Change the word and the limiting concept disappears, even though the example of its unfairness, its inapplicability, remains every bit as accurate.

The problem is the government still wants to use "joint and several liability" in criminal prosecutions, even if the facts don't show any reason to do this. The opinion here focuses on the word "obtained," pointing out there's not a dictionary out there that supports the government's definition in the context of criminal forfeiture. And yet, the practice will go on the way it has for years because of the lack of a blanket interpretation by the Supreme Court. This leaves it up to lower courts to determine the extent of shared liability on a case-by-case basis. And when things are handled this way, it forces the hypothetical college student with $300 to expend far more than that simply to try to avoid being saddled with millions of dollars of restitution as the result of a criminal conspiracy.

Where the court could have clarified, it chose not to. It will hopefully serve as a deterrent to such forfeiture abuse in the future, but its application is narrow, limited, and subject to multiple interpretations. Here's Greenfield to sum it up:

So is it the concept of banging the kid for the boss’ conduct and profit the problem, or is it the word “obtained” in the statute? Is joint and several liability a wrong in itself, or is it only wrong this time? Or is it a misbegotten concept entirely, which should never apply to hold a defendant to greater culpability and liability then the facts, the conduct, warrant? The questions need answers, but the opinion fails to say.

Terry Honeycutt will emerge from his 60-month sentence without a future burden of paying off the forfeited sum. Whether anyone else will be relieved of the joint and several burden remains to be seen.

So, in two cases, the Court has failed to budge the needle on forfeiture. Civil asset forfeiture received nothing more than some judicial tongue-lashing in lieu of certification and criminal asset forfeiture can continue to be used to hold those who don't profit directly from criminal activity responsible for any dollar amount the government can show is likely ill-gotten gains.

Filed Under: asset forfeiture, criminal asset forfeiture, scotus, supreme court