1. WHAT IS IT?

Aereo, the service, allows people to watch re-transmitted television programming (live, or recorded by the customer as individualized copies) over the internet on compatible devices, and at their own time-shifted leisure.[1] This is accomplished through technical wizardry that allocates miniature antennae to each subscriber to link with Aereo’s cloud-based data servers, thereby serving every customer separately, but at once.[2]

 

  1. WHY IS THERE A PROBLEM?

The problem starts with the International Law of Copyright, which grants a bundle of exclusive rights[3] to the creators of certain artistic and literary works.[4] These include the rights to reproduction and public performance, and that is why creators of content get royalties, and broadcasters are paid for their signals (out of which they, in turn, also pay royalties). Most simply put, Aereo contends that:

(i) the recording of this formerly licensed content (an exception to Copyright when done for private usage) is the function that it facilitates; and

(ii) the later viewing of that content as recorded or time-shifted, as well as the original viewing of that content if not recorded or time-shifted, is (due to the antenna usage and individualized copies) a private performance for each customer so viewing it, being another exception to Copyright. As a result, they should not need to pay anyone for anything, and neither should their customers.

The broadcast networks as producers, creators, licensors and purveyors of copyrighted content disagreed (and still do) most vehemently with this, and characterized the Aereo business model in much of their verbal arguments and submissions to the courts at various levels, as nothing more than theft.

 

  1. WHERE DID THIS ALL GO?

So far, the broadcasters tried to stop Aereo before it launched in 2012, suing for an injunction in Federal District Court for the Southern District of New York (as copyright is a matter of federal law). The Judge denied their injunction request.

“Because the Court concludes that it cannot accept Plaintiffs’ novel attempt to distinguish Cablevision, Plaintiffs have not shown a likelihood of success on the merits. And although they have demonstrated that they face irreparable harm, they have not demonstrated that the balance of hardships decidedly tips in their favor. As such, the Court DENIES Plaintiffs motion for a preliminary injunction.”[5]

Then, the broadcasters appealed to a panel of three judges at the United States Court of Appeals for the Second Circuit (2d. Cir.). Two of those judges affirmed the ruling below in denying the injunction, but one of them dissented and took the side of the broadcasters.[6] In their opinion that favoured Aereo, the 2nd Circuit majority cited to their decision in Cartoon Network,[7] an earlier case, and focused-in on the “transmission” element of exclusive public performance rights.[8] As the Second Circuit majority wrote in finding there was no infringing public performance, there had been no intervening United States Supreme Court (U.S.S.C.) decision since Cablevision that would warrant ruling against an established and much relied-upon (especially by the Cloud industry) Appellate decision, and the Appellants could not provide sufficient reasons to depart from that Cablevision ruling in the Aereo case.[9]

 

CARTOON NETWORK/CABLEVISION

In Cartoon Network, Cablevision Systems Corporation (CSC) proposed to start providing its customers with a remote storage, digital video recorder (RS-DVR) device, to which the plaintiffs took deep offence. As the plaintiffs complained:

On information and belief, Cablevision will provide the Service as follows: Cablevision will give Service subscribers the opportunity to request that Cablevision make a copy of programming. The request can be made either as the programming is airing or in advance of the airing time. Upon receiving such a request, Cablevision will make an unauthorized digital copy of that programming on one of its own servers, at the time the programming airs. (…) Cablevision will store the unauthorized copy on its servers for an indefinite period of time. On demand from a Service subscriber, Cablevision will transmit this stored programming to the subscriber in the same way as it transmits its On Demand service.”[10]

At this first instance, the federal District Court in the Southern District of New York agreed that the proposed service would cause a direct infringement of plaintiffs’ exclusive reproduction rights (17 U.S.C. §106(1), and the plaintiffs’ exclusive public performance rights (17 U.S.C. §106(4)).[11] Hence, the Federal District Court for the Southern District of New York (S.D.N.Y.) entered summary judgment for the plaintiffs and granted an injunction barring any unlicensed copying or public performance of plaintiffs’ copyrighted materials, and essentially, banning the service.[12] CSC promptly appealed, and the United States Court of Appeals for the Second Circuit (2d Cir.) reversed and remanded, vacating the injunction with a summary judgment, finding that the S.D.N.Y. had erred in reaching that conclusion.[13] However, the window for potential liability was not totally closed, as the Second Circuit wrote:

This holding, we must emphasize, does not generally permit content delivery networks to avoid all copyright liability by making copies of each item of content and associating one unique copy with each subscriber to the network, or by giving their subscribers the capacity to make their own individual copies. We do not address whether such a network operator would be able to escape any other form of copyright liability, such as liability for unauthorized reproductions or liability for contributory infringement.”[14] (emphasis added).

The plaintiffs appealed to the United States Supreme Court (U.S.S.C.), but the Court denied Certiorari (which meant that it declined to hear the case). The fact that the U.S.S.C. has now decided to hear the Aereo case, which must be decided on a similar matter, shows that something may be changing in its thinking on Copyright, and/or the public interest in light of fast-moving technological developments.

 

  1. WHEN WILL WE KNOW?

The United States Supreme Court is expected to render a decision in or about June, 2014. After that, there is no higher court and nothing can be changed other than by an amendment of law by Congress. It is possible that Congress might act to change something before the Court rules. However, due to high demonstrated partisanship and a desire amongst the parties to see how the Supreme Court Judges think on the issues as they analyze the cases and facts, this is unlikely to happen within the next few months.

 

  1. WHO (as in which side) “SHOULD” WIN?

This is the kicker, because there are other prongs to consider if one performs a fuller horizon scan and “TOP” Analysis,[15] to look at the bigger picture. Let me focus on just three of these other prongs:

First, there is the public interest; second, there is technical pushback; and third, there is related law. I will address these in reverse order.

 

RELATED LAW (net neutrality) –

On this third prong, the United States Federal Communications Commission (FCC) has just announced a pending potential end to the doctrine of “Net Neutrality”. This doctrine, encompassed by 3 principles,[16] is the FCC commitment to “ensuring that every American has access to open and robust high-speed Internet service- or broadband”.[17] Ushering-in a new paradigm, the FCC has recently announced that it will circulate proposed rules to modify those rules. Before anyone had seen the proposed legislation, speculation began to spread that a two-tiered internet would result – one for the haves, and one for the have-nots. The FCC moved swiftly to correct the record, and FCC Chairman Tom Wheeler, stated inter alia, that: “[t]he allegation that it will result in anti-competitive price increases for consumers is also unfounded. That is exactly what the “commercially unreasonable” test will protect against: harm to competition and consumers stemming from abusive market activity.”[18]

If these proposed rules come into force, then marketing of faster internet services and service speeds for a fee, may become the order of the day. Aereo service (if sustainable under the law) could be marketed as a faster or slower alternative, as applicable, or it could still be slowed down and throttled into obscurity in its journey to those consumer Form Factors (phones, tablets, and computers) by ISPs who are weary of running afoul of that still potentially available “contributory infringement” liability left open by the Cablevision court.

 

THE GLOBAL STORM (more related law) –

The above are just some of the many possible results that may still come on the domestic scene. Then, of course, there is also the international dimension. Brazil has recently passed, in the lower house, an internet law the “Marco Civil” championing equal access (net neutrality), multiparty governance (no more U.S. hegemony), and certain other privacy protections for Brazilian citizens.[19] Consider also, that:

(i) On September 12, 2011, China, Russia, Tajikistan, and Uzbekistan proposed an Internet Code of Conduct to the United Nations;[20]

(ii) On February 12, 2014, the European Commission put forth a proposal for democratizing the internet and ostensibly reducing the dominance of certain parties and practices, stating that: “[i]n the wake of large-scale Internet surveillance and reduced trust in the internet, the European Commission today proposes a key reform to the way the Internet is managed and run. The proposal calls for more transparent, accountable and inclusive governance”;[21]

(iii) The United States National Telecommunications and Information Administration (NTIA), a federal government entity, announced on March 14, 2014, that it will withdraw from its leadership role in the Internet Corporation for Assigned Names and Numbers (ICANN), as originally envisaged, but now also (and with certain caveats) “[t]o support and enhance the multistakeholder model of Internet policymaking and governance;”[22] and

(iv) Going back to Brazil, the nation also recently hosted Net Mundial, an April 23-24, 2014 conference on the preferred future of the internet.[23]

Many of us have read or seen various “works of fiction” depicting alternative realities in a future where different jurisdictions and groups of jurisdictions have wildly different laws in the technology field, but all still manage to somehow, “almost” get along with the words “Free”, or “Neutral” in their names. Electronic conduct that is completely illegal in one, may be more permissible or even empowered by law in the other – consider mass surveillance as against mass and effective encryption; copyright infringement as against fair usage; differential download speeds (for a fee) as against one speed for all; and so forth. Any platform provider doing business in multiple such “Zones” may be moved to have, and provide, and support multiple devices for multiple such locations; or may in the alternative, be encouraged or compelled to have a single device with different functionalities either enabled or disabled by insertion of a chip-type device that is specific to each Zone, and the laws and mores of each Zone.

The seed for this is already here in phone “sim” cards. However and at the same time, we have seen how one person’s internet programming and/or oversight mistake can apparently endanger the entire system;[24] how some cybersecurity vulnerabilities may allegedly come pre-installed;[25] and how export restrictions and sanctions can starve persons and places of critical technologies.[26] As a result, once you take technology made by someone else, somewhere else, subject to the will of some other government(s) … you “are” in their debt for updates and support, and you “may also be” in their pocket!

Whatever the case and whichever way you look at it, something is building-up and the world is going somewhere that looks like that general “work of fiction” direction.

Will this be:

DOOR NUMBER ONE – A single internet with a unified governance system;

DOOR NUMBER TWO – Multiple internets with disparate rules and eBusinesses juggling to retain compliance due to their many governments and government groups “seeing RED” in arguing for:

(i) “R”egulatory sovereignty and “R”eal sovereignty (rules and regulations, and the right to react and redact in the face of social media free? speech created by foreign governments,[27] economically enabled from other jurisdictions, or owned by opaque/operated by irresponsible foreign entities,[28] as well as the right and capability to detect, detour-about, defuse, debunk and delete information warfare, manipulated media, and ruinous requisitioned reporting – a.k.a. censorship);

(ii) “E”lectronic sovereignty (payment systems, virtual currencies, financial transparency, and autonomy to engage in cybercrime countermeasures, and to develop and deploy (offensive), and detect and defend against (defensive) electronic warfare operations in, from, or to any one or any place in any way, and at any time); and

(iii) “D”ata sovereignty (data and personal privacy and the way and means in which it may be curtailed or canceled outright, data residence including the extraterritorial treatment of the data of its own Citizens, and assorted solo and coalition national security operations in the data domain); or –

DOOR NUMBER THREE …….??

 

TECHNICAL PUSHBACK (digi-tagging)

On this second prong, content owners are already quite adept at Region Coding[29] on DVDs, to ensure that the content on them can only be accessed in those regions for which they have been specifically pre-programmed to work. It may now be technically possible to have:

(i) sub-codes for timed release (to prevent unfavourable time-shifting);

(ii) sub-codes for specific ISPs and phone telecommunications entities (to prevent cross-portability of content – although this may well defeat the purpose of “broadcast” by turning it into “limi-cast”, or run so afoul of some analogy on free number portability between carriers, or other laws and regulations, that it is unfeasible); or

(iii) some other digi-tag countermeasure.

 

PUBLIC INTEREST (sometimes subjective) –

On this first prong, we have a wildcard that nobody can predict. Is it more in the public interest to have content widely available, than it is to uphold a rigid reading of the law? Is it better to read the law loosely and protect fledgling domestic businesses like Aereo as well as U.S. global Cloud industry giants (based in the United States but under foreign and domestic suspicion after the Snowden revelations[30]), while allowing a perceived weakening of copyright protections? Will any of these three prongs be considered in a determination of whether the proposed merger of Comcast and Time Warner[31] will be in the public interest, or whether that proposed merger has any bearing on the Aereo case? Who can say?

I think that the public interest “should” win, but only the Court can decide what that public interest is, and on which side of the litigation it will finally fall. All of us, including the litigants, can only wait and see what and where that will be ………. and then Congress as a group can say yea or nay, or just let it be.

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Author:

Ekundayo George is a sociologist and a lawyer. He has also taken courses in organizational and micro-organizational behavior, and has significant experienced in business law and counseling (incorporations, business plans, contracts and non-disclosure agreements, teaming and joint venture agreements), diverse litigation, and regulatory compliance practice. He is licensed to practice law in Ontario, Canada, as well as in New York, New Jersey, and Washington, D.C., in the United States of America (U.S. business advising, outsourcing and cross-border trade, technology contracts, and U.S. financing). See, for example: http://www.ogalaws.com. A writer, blogger, and avid reader, Mr. George has sector experience in Technology (Telecommunications, eCommerce, Outsourcing, Cloud), Financial Services, Healthcare, Entertainment, Real Estate and Zoning, International/cross-border trade, other Services, and Environmental Law and Policy. He is a published author on the National Security aspects of Environmental Law, has represented clients in courts and before regulatory bodies in both Canada and the United States, and he enjoys complex systems analysis in legal, technological, and societal milieux.

Mr. George is also an experienced negotiator, facilitator, team leader, and strategic consultant- sourcing, managing, and delivering on large, strategic projects with multiple stakeholders and multidisciplinary teams. Our competencies include program investigation, sub-contracted procurement of personnel and materiel, and such diverse project deliverables as business process re-engineering, devising and delivering tailored training, and other targeted engagements through a highly-credentialed resource pool with several hundred years of combined expertise, in: Healthcare; Education & Training; Law & Regulation; Policy & Plans; Statistics, Economics, & Evaluations including feasibility studies; Infrastructure; and Information Technology/Information Systems (IT/IS) – sometimes also termed Information Communications Technologies, or ICT). See, for example: http://www.simprime-ca.com.

Hyperlinks to external sites are provided to readers of this blog as a courtesy and convenience, only, and no warranty is made or responsibility assumed by either or both of George Law Offices and Strategic IMPRIME Consulting & Advisory, Inc. (“S’imprime-ça”) including employees, agents, directors, officers, successors & assigns, in whole or in part for their content, accuracy, or availability.

This article creates no lawyer-client relationship, and is not intended or deemed legal advice, business advice, the rendering any professional service, or attorney advertising where restricted or barred. The author and affiliated entities specifically disclaim and reject any and all loss claimed, no matter howsoever resulting as alleged, due to any action or inaction done in reliance on the contents herein.

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[1] See Aereo. What is Aereo?   Visited April 24, 2014. Online: >http://support.aereo.com/customer/portal/articles/359733-what-is-aereo< For details on further proceedings in this case, see also Ekundayo George.  WNET THIRTEEN v. Aereo, Inc. – the United States Supreme Court (U.S.S.C.) Verdict.  Posted on ogalaws.wordpress.com, June 26, 2014.
Online: >https://ogalaws.wordpress.com/2014/06/26/wnet-thirteen-v-aereo-inc-the-united-states-supreme-court-u-s-s-c-verdict/<

[2] See Aereo. About. Visited April 24, 2014. Online: >https://aereo.com/about<

[3] Cornell Legal Information Institute (LII). U.S. Code: Title 17 – Copyrights. Online: >http://www.law.cornell.edu/uscode/text/17<

17 U.S.C. §106 – Exclusive rights in copyrighted works.

Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following:

(1) to reproduce the copyrighted work in copies or phonorecords;

(2) to prepare derivative works based upon the copyrighted work;

(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;

(4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly;

(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly; and

(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.

 

Government of Canada, Justice Laws Website. Copyright Act. Online: >http://laws-lois.justice.gc.ca/eng/acts/C-42/FullText.html<

Copyright Act (R.S.C., 1985, c. C-42) – Canada.

PART I COPYRIGHT AND MORAL RIGHTS IN WORKS

Copyright in works.

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

(a) to produce, reproduce, perform or publish any translation of the work,

(b) in the case of a dramatic work, to convert it into a novel or other non-dramatic work,

(c) in the case of a novel or other non-dramatic work, or of an artistic work, to convert it into a dramatic work, by way of performance in public or otherwise,

(d) in the case of a literary, dramatic or musical work, to make any sound recording, cinematograph film or other contrivance by means of which the work may be mechanically reproduced or performed,

(e) in the case of any literary, dramatic, musical or artistic work, to reproduce, adapt and publicly present the work as a cinematographic work,

(f) in the case of any literary, dramatic, musical or artistic work, to communicate the work to the public by telecommunication,

(g) to present at a public exhibition, for a purpose other than sale or hire, an artistic work created after June 7, 1988, other than a map, chart or plan,

(h) in the case of a computer program that can be reproduced in the ordinary course of its use, other than by a reproduction during its execution in conjunction with a machine, device or computer, to rent out the computer program,

(i) in the case of a musical work, to rent out a sound recording in which the work is embodied, and

(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,

and to authorize any such acts.

[4] Copyright law is codified in the United States at 17 U.S.C. § 101 et seq. With a few distinctions, such as the definitions of works protected in different countries (e.g. “original works of authorship fixed in any tangible medium of expression” in the United States and “literary, dramatic, musical, and artistic works (…) computer programs” in Canada), the law is quite uniformly applied through a number of treaties and conventions beyond the limited scope of this blog post. See also note 3, supra.

17 U.S.C. §102 – Subject matter of copyright: In general.

(a) Copyright protection subsists, in accordance with this title, in original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device. Works of authorship include the following categories:

(1) literary works;

(2) musical works, including any accompanying words;

(3) dramatic works, including any accompanying music;

(4) pantomimes and choreographic works;

(5) pictorial, graphic, and sculptural works;

(6) motion pictures and other audiovisual works;

(7) sound recordings; and

(8) architectural works.

[5] See judgment of July 11, 2012, issued by the Honourable Alison J. Nathan, U.S.D.J., in WNET Thirteen et al. v. Aereo Inc.; American Broadcasting Companies, Inc., et al v. Aereo, Inc.,874 F. Supp. 2d 373 (S.D.N.Y. Jul. 11, 2012), at page 52. Online: >https://www.eff.org/files/filenode/Denial%20of%20PI.pdf< In saying and citing “Cablevision”, the judge was referring to the 2nd Circuit’s 2008 “Cartoon Network” decision, infra at note 7 of this blog post.

[6] See WNET, Thirteen v. Aereo, Inc.; Am. Broad. Cos., Inc. v. Aereo, Inc., 12-2786-cv; 12-2807-cv (2d Cir. 2012), decided April 1, 2013. Dissenting opinion of The Honorable Denny Chin, Circuit Judge. Online:  >http://docs.justia.com/cases/federal/appellate-courts/ca2/12-2807/202356377/0.pdf< For substantially the same reasons, Judge Chin was also joined by Judge Richard C. Wesley, Circuit Judge, in dissenting to the denial of an en banc hearing on the appeal (by the entire United States Court of Appeals for the Second Circuit). Online: > http://www.ca2.uscourts.gov/decisions/isysquery/2dcd67b0-2b31-42d4-a190-1f09b735f5d2/2/doc/12-2786_12-2807_enbanc_complete.pdf#xml=http://www.ca2.uscourts.gov/decisions/isysquery/2dcd67b0-2b31-42d4-a190-1f09b735f5d2/2/hilite/<

[7] The Cartoon Network LP, LLLP v. CSC Holdings, Inc., 07-1480-cv(L) & 07-1511-cv(CON), 536 F. 3d 121 (2d Cir. 2008), decided August 4, 2008. Online: >https://www.eff.org/files/filenode/studios_v_cablevision/cablevision-decision.pdf<

[8] See Cornell Legal Information Institute (LII), supra note 3.

17 U.S.C. §101 – Definitions.

To perform or display a work “publicly” means-

(1) to perform or display it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered; or

(2) to transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times.

See also supra note 1 and accompanying text. Aereo’s individual antennae (apparently) make the performances and re-performances private, thus technologically avoiding a “public” element needed for copyright infringement.

[9] WNET, Thirteen v. Aereo, Inc.; Am. Broad. Cos., Inc. v. Aereo, Inc., 12-2786-cv; 12-2807-cv (2d Cir. 2012), decided April 1, 2013, at note 19 of the ruling and accompanying text. Online: >https://www.eff.org/files/filenode/aereo_opinion.pdf< Cartoon Network and Cablevision are used interchangeably in this blog post.

[10] See ¶20 of original Complaint of The Cartoon Network LP. LLLP and Cable News Network LP, LLLP, filed May 26, 2006, in the United States District Court for the Southern District of New York, as 06-cv-4092. Online: >http://tipp.ucla.edu/documents/case50/Cartoon_Network%27s_Complaint.pdf

[11] See judgment of April 4, 2007, issued by The Honorable Denny Chin, U.S.D.J., in The Cartoon Network LP. LLLP et al v. CSC Holdings, Inc. et al, 06-cv-4092 and 06-cv-3990 (S.D.N.Y. Apr. 4, 2007), at paragraphs 4-5. Online: >http://docs.justia.com/cases/federal/district-courts/new-york/nysdce/1:2006cv04092/285045/62<

[12] Id. at paragraph 6. The full reasoning and opinion behind that S.D.N.Y. judgement, can also be found here: Online: >http://docs.justia.com/cases/federal/district-courts/new-york/nysdce/1:2006cv04092/285045/61<

[13] Supra note 6, Cartoon Network, at 44.

[14] Supra note 6, Cartoon Network, at 43-44.

[15] See Ekundayo George. “TOP” analysis: a timely successor to SWOT analysis? Published on ogalaws.wordpress.com, May 6, 2012. Online: >https://ogalaws.wordpress.com/2012/05/06/top-analysis-a-timely-successor-to-swot-analysis/<

[16] See United States Federal Communications Commission (FCC). Guide: The Open Internet. Online: >http://www.fcc.gov/guides/open-internet<

The FCC and Open Internet Rules.

“There are three basic Open Internet rules:

1. Transparency: Broadband providers must disclose information regarding their network management practices, performance, and the commercial terms of their broadband services;

2. No Blocking: Fixed broadband providers (such as DSL, cable modem or fixed wireless providers) may not block lawful content, applications, services or non-harmful devices. Mobile broadband providers may not block lawful websites, or applications that compete with their voice or video telephony services;

3. No Unreasonable Discrimination: Fixed broadband providers may not unreasonably discriminate in transmitting lawful network traffic over a consumer’s broadband Internet access service. The no blocking and no unreasonable discrimination rules are subject to limited exceptions for “reasonable network management.””

[17] Id.

[18] Commissioner Tom Wheeler, Chairman of the Federal Communications Commission. Setting the Record Straight on the FCC’s Open Internet Rules. Published on fcc.gov, April 24, 2014. Online: >http://www.fcc.gov/blog/setting-record-straight-fcc-s-open-internet-rules<

[19] See Mike Palmedo. English Translation of the New Version of Brazil’s Marco Civil (courtesy of Carolina Rossini).  Posted on infojustice.org, November 18, 2013. Online: >http://infojustice.org/archives/31272< Please note that this early version shown is not exactly the same as the actual version recently passed.

[20] United Nations Organization (UN). Letter dated 12 September 2011 from the Permanent Representatives of China, the Russian Federation, Tajikistan and Uzbekistan to the United Nations addressed to the Secretary-General.  Sixty-sixth session Item 93 of the provisional agenda* Developments in the field of information and telecommunications in the context of international security. A/66/359.  Dated September 14, 2011. Online: >http://content.netmundial.br/files/67.pdf<

[21] European Commission. Commission to pursue role as honest broker in future global negotiations on Internet Governance. Press Release published on europa.eu, February 14, 2014. Online: >http://europa.eu/rapid/press-release_IP-14-142_en.htm<

[22] National Telecommunications and Information Administration (NTIA). NTIA Announces Intent to Transition Key Internet Domain Name Functions. Press Release posted on ntia.org, March 14, 2014. Online: >http://www.ntia.doc.gov/press-release/2014/ntia-announces-intent-transition-key-internet-domain-name-functions<

[23] RT. Brazil passes ‘internet constitution’ ahead of global conference on web future. Posted on rt.com, April 23, 2014.   Online: >http://rt.com/news/154168-brazil-internet-freedom-law-conference/<  See also >http://netmundial.org/<

[24] Robert Merkel. How the Heartbleed bug reveals a flaw in online security. Posted on theconversation.com, April 11, 2014. Online: >http://theconversation.com/how-the-heartbleed-bug-reveals-a-flaw-in-online-security-25536<

[25] Danielle Walker. Pre-installed security software leaves computers vulnerable to remote hijack, experts reveal.

Posted on scmagazine.com, February 12, 2014. Online: >http://www.scmagazine.com/pre-installed-security-software-leaves-computers-vulnerable-to-remote-hijack-experts-reveal/article/333808/< See also Lily Hay Newman. One More Reason to Stop Using Internet Explorer. Posted on slate.com, April 28, 2014. Online: >http://www.slate.com/blogs/future_tense/2014/04/28/internet_explorer_has_a_vulnerability_that_microsoft_admits_is_being_exploited.html<

[26] Staff Report. Iran sanctions main hurdle in gas pipeline. Published on dailytimes.com.pk, April 28, 2014. Online: >http://www.dailytimes.com.pk/business/11-Apr-2014/iran-sanctions-main-hurdle-in-gas-pipeline<  But see Srinivas Laxman. India overcame US sanctions to develop cryogenic engine. Posted on indiatimes.com, January 6, 2014. Online: >http://timesofindia.indiatimes.com/india/India-overcame-US-sanctions-to-develop-cryogenic-engine/articleshow/28449360.cms<

[27] Desmond Butler, Jack Gillum, and Alberto Arce. US secretly created ‘Cuban Twitter’ to stir unrest. Posted on ap.org, April 4, 2014. Online: >http://bigstory.ap.org/article/us-secretly-created-cuban-twitter-stir-unrest<

[28] Sometimes, the dealings of odd entities, nondescript government agencies, and extremely wealthy families and individuals, can be found to have occurred in well-known, but un-named and highly opaque (if not regulatorily impenetrable) “tax-advantaged” jurisdictions.

[29] Sony Corporation. What are DVD region codes? Available on us.en.kb.sony.com, last Updated: 01/07/2014. Online: >https://us.en.kb.sony.com/app/answers/detail/a_id/38063/~/what-are-the-dvd-region-codes%3F<

[30] Stephen Shankland. Snowden revelations spook Hightail’s cloud-computing customers. Published on cnet.com, December 11, 2013. Online: >http://www.cnet.com/news/snowden-revelations-spook-hightails-cloud-computing-customers/<

[31] Comcast. Time Warner Cable to Merge with Comcast Corporation to Create a World-Class Technology and Media Company. Press Release posted on comcast.com, February 13, 2014. Online: >http://corporate.comcast.com/news-information/news-feed/time-warner-cable-to-merge-with-comcast-corporation<

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According to the United States’ National Labor Relations Board (NLRB) – it depends. On April 1, 2014, the NLRB ruled on the appeal of (and made even murkier),[1] an initial decision before a single Administrative Law Judge (ALJ) of February 17, 2012,[2] in which the answer to that question was first and thoroughly muddied.

 

INSTRUCTIONS: Hills and Dales General Hospital of Cass City, Michigan (hereinafter the hospital), had as do most employers, an interest in maintaining the discipline and well-being of its employees; in protecting and improving the goodwill and community reputation of its business; the continuation of its business operations as a going concern; and its full and good faith compliance with applicable law. Hence, it structured and issued a `Good Conduct` policy for its staff that provided, in relevant part:[3]

With regard to Teamwork –

11. We will not make negative comments about our fellow team members and we will take every opportunity to speak well of each other.

16. We will represent Hills & Dales in the community in a positive and professional manner in every opportunity.

With regard to Attitude –

21. We will not engage in or listen to negativity or gossip. We will recognize that listening without acting to stop it is the same as participating.

Oddly enough, it was to remedy what the hospital itself, had described as a poor work environment riddled with back-biting and back stabbing as far back as 2005, that the company instituted its new Values and Standards of Behaviour Policy (hereinafter the Policy”).[4] The policy, once implemented after several rounds of employee reviews and edits, was: (i) voluntarily signed by some of the hospital`s employees then framed in public posters within the workplace; (ii) included in the hospital`s human resources policy manual, with employee acknowledgements of the receipt of same signed, and placed in their personnel files; and (iii) used as a basis for employee discipline by the hospital on at least one occasion.[5]

 

NUANCES: In failing to give specific definitions or examples of what constituted negative, or positive and professionalconduct,[6] the hospital was charged with a violation of Section 7 of the National Labor Relations Act (NLRA) for knowingly maintaining such a vague and overbroad Policy of employee conduct.

 

RIGHTS OF EMPLOYEES –

Sec. 7. [§ 157.] Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a)(3) [section 158(a)(3) of this title].[7] (emphasis added).

The specific unfair labor practice alleged as in, and impacting interstate commerce, was described under Section 8(a)(1):

 

UNFAIR LABOR PRACTICES –

Sec. 8. [§ 158.] (a) [Unfair labor practices by employer] It shall be an unfair labor practice for an employer–

(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7 [section 157 of this title];

 

FINDINGS BELOW: ALJ Carter upheld the bulk of the allegations that the statements or conduct of the hospital did indeed have a reasonable tendency to interfere with, restrain or coerce union or protected activities as interpreted by a reasonable employee,[8] in light of relevant tests for the application of Section 7 of the NLRA.[9] As the ALJ ruled: paragraph 11 implicitly includes protected activities because it prohibits negative comments about managers,[10] paragraph 16’s call for employees to represent the hospital in a positive and professional manner is a lawful call for employees to maintain a high standard of professionalism with potential (or actual) customers at every opportunity,[11] and the Hospital’s (paragraph 21) prohibition of ’negativity’ is so patently ambiguous, imprecise and overbroad that a reasonable employee would construe it as prohibiting protected discussions about working conditions and the terms and conditions of employment.[12]

Hence, ALJ Carter decided and Ordered that the hospital act within 14 days to revise or rescind paragraphs 11 and 21 of its Values and Standards of Behaviour Policy (but he dismissed the allegation with regard to paragraph 16 of that same Policy); with a further Order for workplace posting and electronic delivery to hospital employees, of an Appendix undertaking that was structured and worded on the substance of his decision and Order.[13]

That first decision by ALJ Carter was then appealed to the NLRB, with the parties filing exceptions, cross-exceptions and supporting briefs, answering briefs, and reply briefs, and the matter was subsequently heard and recently decided by a panel of three Members of the same National Labor Relations Board.

 

RULING ON APPEAL: The NLRB panel adopted ALJ Carter`s findings and decision with regard to paragraphs 11 and 21 of the Policy, but reversed them with regard to paragraph 16 in a 2:1 ruling – concluding that the language therein did indeed constitute an additional violation of the NLRA, after all.[14]

The requirement that employees “represent [the Respondent] in the community in a positive and professional manner” is just as overbroad and ambiguous as the proscription of “negative comments” and “negativity” in paragraphs 11 and 21. (…) This would, for example, discourage employees from engaging in protected public protests of unfair labor practices, or from making statements to third parties protesting their terms and conditions of employment—activity that may not be “positive” towards the Respondent but is clearly protected by Section 7. [15]

Accordingly, the panel issued a revised decision and Order of April 1, 2014, that included an additional requirement (again to be acted upon within 14 days thence), that the hospital also revise or rescind paragraph 16 of its Values and Standards of Behaviour Policy, along with paragraphs 11 and 21 as earlier ordered by ALJ Carter in his 2012 decision and Order.[16]

 

AFTER-EFFECTS: This decision on appeal, shows that any attempt by employers to impose (or suggest or recommend) a certain standard of conduct should be very narrowly-tailored, otherwise it may well run afoul of the National Labor Relations Act, the NLRB policy, and applicable caselaw. Although it would be highly advisable to delineate examples of what would (or might) be considered impermissible conduct under the employer standard, the potential for a catch 22 remains – (a) over-inclusiveness may lead to serious enforceability issues and credible challenges of overbreadth; whilst (b) under-inclusion due to at times glaring omissions, may leave some otherwise objectionable conduct non-sanctionable, for claimed lack of notice that it was a “no-go area” on the part of an aggrieved current or former employee.

In short, employers should tread very carefully, seek legal counsel, and not necessarily assume, as did the hospital, apparently, that a standard of conduct template already in use elsewhere with no apparent issues, is a good one to follow; or that employee input and consultation in the creation of the standard – even if that participation is significant and sustained in the process, will somehow prevent or preclude the standard as finally made, from clearly or potentially infringing upon or prohibiting outright, some protected activity under the NLRA, or being otherwise objectionable in the eyes of an ALJ on the decision below (as with paragraphs 11 and 21 of the Policy), of an NLRB panel on appeal (as with paragraph 16 of the Policy), or perhaps both.

 

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Author:

Ekundayo George is a sociologist and a lawyer. He has also taken courses in organizational and micro-organizational behavior, and has significant experienced in business law and counseling (incorporations, business plans, contracts and non-disclosure agreements, teaming and joint venture agreements), diverse litigation, and regulatory compliance practice. He is licensed to practice law in Ontario, Canada, as well as in New York, New Jersey, and Washington, D.C., in the United States of America (U.S. business advising, outsourcing and cross-border trade, technology contracts, and U.S. financing).  See, for example: http://www.ogalaws.com.  A writer, blogger, and avid reader, Mr. George has sector experience in Technology (Telecommunications, eCommerce, Outsourcing, Cloud), Financial Services, Healthcare, Entertainment, Real Estate and Zoning, International/cross-border trade, other Services, and Environmental Law and Policy. He is a published author on the National Security aspects of Environmental Law, has represented clients in courts and before regulatory bodies in both Canada and the United States, and he enjoys complex systems analysis in legal, technological, and societal milieux.

Mr. George is also an experienced negotiator, facilitator, team leader, and strategic consultant- sourcing, managing, and delivering on large, strategic projects with multiple stakeholders and multidisciplinary teams. Our competencies include program investigation, sub-contracted procurement of personnel and materiel, and such diverse project deliverables as business process re-engineering, devising and delivering tailored training, and other targeted engagements through a highly-credentialed resource pool with several hundred years of combined expertise, in: Healthcare; Education & Training; Law & Regulation; Policy & Plans; Statistics, Economics, & Evaluations including feasibility studies; Infrastructure; and Information Technology/Information Systems (IT/IS) – sometimes also termed Information Communications Technologies, or ICT). See, for example: http://www.simprime-ca.com.

Hyperlinks to external sites are provided to readers of this blog as a courtesy and convenience, only, and no warranty is made or responsibility assumed by either or both of George Law Offices and Strategic IMPRIME Consulting & Advisory, Inc. (“S’imprime-ça”) including employees, agents, directors, officers, successors & assigns, in whole or in part for their content, accuracy, or availability.

This article creates no lawyer-client relationship, and is not intended or deemed legal advice, business advice, the rendering any professional service, or attorney advertising where restricted or barred. The author and affiliated entities specifically disclaim and reject any and all loss claimed, no matter howsoever resulting as alleged, due to any action or inaction done in reliance on the contents herein.

 

[1] Hills and Dales General Hospital and Danielle Corlis, Case 07-CA-053556 (Apr. 1, 2014), 360 NLRB No. 70 (2014), before Mark Gaston Pearce, Chairman, and members Harry I. Johnson, III, and Nancy Schiffer.

[2] Hills and Dales General Hospital and Danielle Corlis, Case 07-CA-053556 (Feb. 17, 2012), before Geofffey Carter, ALJ.

[3] Id. at 2-3.

[4] Id. at 2. “As a result, employee satisfaction was low, employees were looking for other job opportunities (outside of the Hospital), and patients were seeking health care in other hospitals”.

[5] Id. at 3.

[6] Id.

[7] National Labor Relations Board. The National Labor Relations Act of 1935,29 U.S.C. §§ 151-169 [Title 29, Chapter 7, Subchapter II, United States Code]. Online: http://www.nlrb.gov/resources/national-labor-relations-act

[8] Hills and Dales General Hospital and Danielle Corlis, Case 07-CA-053556 (Feb. 17, 2012), before Geofffey Carter, ALJ, at 6. “In the Acting General Counsel’s view, those work rules are overbroad because a reasonable employee would conclude that the rules prohibit protected activity such as employee discussions about the terms and conditions of their employment”.

[9] Id. at 5. “If the rule explicitly restricts Section 7 activity, it is unlawful. If the rule does not explicitly restrict Section 7 activity, it is nonetheless unlawful if (1) employees would reasonably construe the language of the rule to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights. In applying these principles, the Board refrains from reading particular phrases in isolation, and it does not presume improper interference with employee rights”. NLS Group, 352 NLRB 744, 745 (2008) (citing Lutheran Heritage Village-Livonia, 343 NLRB 646, 646–647 (2004)), adopted in 355 NLRB No. 169 (2010), enfd. 645 F.3d 475 (1st Cir. 2011).

[10] Id. at 6.

[11] Id. at 7-8.

[12] Id. at 9, emphasis added.

[13] Id. at 10.

[14] Hills and Dales General Hospital and Danielle Corlis, Case 07-CA-053556 (Apr. 1, 2014), 360 NLRB No. 70, slip op. at 1 (2014), before Mark Gaston Pearce, Chairman, and members Harry I. Johnson, III, and Nancy Schiffer.

[15] Id. slip op at 2.

[16] Id. slip op at 3; see also footnote 6 of this decision and Order.

PREAMBLE:

So far in this study, we have introduced the complexities of 3 of the 5 Domains or “faces” of Data as a complex system: Form Factors,[1] Applications,[2] and Categories.[3] Now, in Part 4, we consider End-Users.

 

ANALYSIS:

End-Users.

These are the different users and user-groups who can and do, make various uses of the data.

 

Level 2 (provenance): As the ultimate consumer, that end-user can be any or all of an individual or a group, a business or business group, or a government or government agency, or government collective. Hence, at this level, we have placed just two options: (i) Insiders, who are the known and permitted users of the data, and (ii) Outsiders, who are the not permitted but sometimes known users of the data, if and when a breach can be tracked-back to its point of origin,[4] or when the user without permission can be found.

 

Level 3 (management): Here, the end-users can be categorized into three separate groups for management purposes. (i) Vetted, are those end-users who have been cleared and properly credentialed for data access. (ii) Unknown users are those with spoofed or un-trusted credentials – whether it is hacked passwords, expired security certificates, or other sharp workarounds of security protocols that allow data access. (iii) CMC, are those criminal, malicious, or compromised users who may appear to be vetted or unknown, but who have ulterior motives. The essential and constant challenge for all IT security and IT governance professionals is to ensure that the vetted remain vetted; the unknown do not become or appear to be vetted; and that the CMC remain on the outside of the trusted data-user community. [5]

 

Level 4 (security): As with earlier installments, there are on this level, categories for: (i) identity and access management (IAM); (ii) management “controls for risk, encryption, and security technique” (CREST); and two categories for regulatory compliance, being (iii) Regulatory Compliance (generic) which includes privacy and Intellectual Property Rights (IPR); and (iv) Regulatory Compliance (specific), which includes subnational, national, and transnational rules, and any industry-specific codes of compliance.

 

Level 5 (attack vectors): Here, we will specify the attack vectors as targeted at or emanating from, one or more of these five distinct groups. These are: (i) individual; (ii) family; (iii) group or network; (iv) business or business group; and (v) government, or government agency or collective. The individual might be a hacktivist, or someone with a form factor that has been unknowingly compromised. The family, again, might just be the innocent victim of a botnetted[6] machine within the household that identifies their IP address as the attack’s malicious source. The group or network may have third-party packet sniffer software installed that its Sys-admin does not catch, or chooses to ignore and/or not disclose to others. And then, the business or business group may be compromised directly, or through a third-party vendor.[7] Recent revelations about alleged government cooperation with internet and technology companies,[8] show how this fifth attack vector might stand alone; might combine with the third in a complicit Sys-admin (who does or does not see a lawful warrant); or might even combine with a targeted intelligence operation by a government agency that sees a keylogger, for example, installed on a business or household form factor known or suspected to be used by, some person of interest.[9]

 

Level 6 (aggregation): Finally, data end-users can also be found and aggregated across 6 spaces. There are two, under each of: (a) being at the individual’s option (such as for biometrics and geolocation, or other consumer-friendly applications – as opted-into or “not” opted-out of); (b) the commercial need and machine-driven (such as for SCADA/Supervisory Control and Data Acquisition, RFID/Radiofrequency Identification, or other business-inspired or business enhancing applications; and (c) the Government-aggregation (for various overt matters including health, morals and welfare, on one hand; or for covert matters, such as law enforcement and intelligence-driven surveillance operations, on the other hand).

 

CONCLUSION:

The depth and breadth of Data as a complex system continue to be enhanced by the interactions of its five Domains, and of the many faces therein. Having now considered Form Factors, Applications, Categories, and End-Users, our next and final installment will consider the “Scale” Data Domain.[10]

*********************************************************************

Author:

Ekundayo George is a sociologist and a lawyer. He has also taken courses in organizational and micro-organizational behavior, and has significant experienced in business law and counseling (incorporations, business plans, contracts and non-disclosure agreements, teaming and joint venture agreements), diverse litigation, and regulatory practice. He is licensed to practice law in Ontario, Canada, as well as in New York, New Jersey, and Washington, D.C., in the United States of America (U.S. business advising, outsourcing and cross-border trade, technology contracts, and U.S. financing). See, for example: http://www.ogalaws.com. A writer, blogger, and avid reader, Mr. George has sector experience in Technology (Telecommunications, eCommerce, Outsourcing, Cloud), Financial Services, Healthcare, Entertainment, Real Estate and Zoning, International/cross-border trade, other Services, and Environmental Law and Policy. He is a published author on the National Security aspects of Environmental Law, and enjoys complex systems analysis in legal, technological, and societal milieux.

 

Mr. George is also an experienced strategic consultant; sourcing, managing, and delivering on large, strategic projects (investigations, procurements, and diverse consulting engagements) with multiple stakeholders and multidisciplinary project teams. See, for example: http://www.simprime-ca.com.

 

Hyperlinks to external sites are provided to readers of this blog as a courtesy and convenience, only, and no warranty is made or responsibility assumed by either or both of George Law Offices and Strategic IMPRIME Consulting & Advisory, Inc. (“S’imprime-ça”) including employees, agents, directors, officers, successors & assigns, in whole or in part for their content, accuracy, or availability.

 

This article creates no lawyer-client relationship, and is not intended or deemed legal advice, business advice, the rendering any professional service, or attorney advertising where restricted or barred. The author and affiliated entities specifically disclaim and reject any and all loss claimed, no matter howsoever resulting as alleged, due to any action or inaction done in reliance on the contents herein.

____________________________________________________

[1] Ekundayo George. The 100 “FACES” of Data: a 5-part Complex Systems Study (Part 1 – Form Factors). Published on ogalaws.wordpress.com, November 1, 2013. Online: >https://ogalaws.wordpress.com/2013/11/01/the-100-faces-of-data-a-5-part-complex-systems-study-part-1/<

[2] Ekundayo George. The 100 “FACES” of Data: a 5-part Complex Systems Study (Part 2 – Applications). Published on ogalaws.wordpress.com, December 27, 2013. Online: >https://ogalaws.wordpress.com/2013/12/27/the-100-faces-of-data-a-5-part-complex-systems-study-part-2-applications/<

[3] Ekundayo George. The 100 “FACES” of Data: a 5-part Complex Systems Study (Part 3 – Categories). Published on ogalaws.wordpress.com, February 4, 2014. Online: >https://ogalaws.wordpress.com/2014/02/04/the-100-faces-of-data-a-5-part-complex-systems-study-part-3-categories/<

[4] Both insiders and outsiders can be sources of significant threat to any business, or other data producer or data consumer. However, some research shows that the most significant threat comes from the outsider. See e.g. Ericka Chickowski. Should Insiders Really Be Your Biggest Concern? Published on darkreading.com, April 23, 2013.   Online: > http://www.darkreading.com/insider-threat/should-insiders-really-be-your-biggest-c/240153455 <. See contra. Ponemon Institute. Fourth Annual Benchmark Study on Patient Privacy and Data Security. Published on ponemon.org, March 12, 2014. Online: >http://www.ponemon.org/blog/fourth-annual-benchmark-study-on-patient-privacy-and-data-security< In the medical field with regard to patient data security, insider risk is greater.

[5] There is a technical, definitional difference between unauthorized and non-credentialed. Credentials, such as passwords, pass keys, and biometric inputs all grant access, and so a properly credentialed user may be vetted and therefore authorized to access data on system A, but although vetted, “not” unauthorized to access data on system B. That user on system A may nevertheless try to gain access to data on system B, as a CMC (criminal, malicious, or compromised) user. On the other hand, if one gains access or attempts to gain access to data on system A or system B with stolen or spoofed credentials (apparently vetted), or through a credentials workaround (clearly non-credentialed), then this is essentially a non-credentialed access by an unknown user (absent the availability of more information), and it is unauthorized.

[6] Jeremy Reimer. FBI: Over one million computers working for botnets. Posted on arstechnica.com, June 14, 2007. >http://arstechnica.com/security/2007/06/fbi-over-one-million-computers-working-for-botnets/<

[7] Brian Krebs. Email Attack on Vendor Set Up Breach at Target. Published on krebsonsecurity.com, February 12, 2014. Online: >http://krebsonsecurity.com/2014/02/email-attack-on-vendor-set-up-breach-at-target/<

[8] Anthony Wing Kosner. All Major Tech Companies Say NSA Actions Put Public Trust In Internet At Risk. Published on forbes.com, December 9, 2013. Online: >http://www.forbes.com/sites/anthonykosner/2013/12/09/all-major-tech-companies-say-nsa-actions-puts-public-trust-in-internet-at-risk/<

[9] Declan McCullagh. Feds use keylogger to thwart PGP, Hushmail. Published on cnet.com, July 10, 2007. Online: >http://www.cnet.com/news/feds-use-keylogger-to-thwart-pgp-hushmail/<

[10] See Ekundayo George.  The 100 “FACES” of Data: a 5-part Complex Systems Study (Part 5 – Scale).  Published on ogalaws.wordpress.com, May 15, 2014.  Online: >http://www.ogalaws.wordpress.com/2014/05/15/the-100-faces-of-data-a-5-part-complex-systems-study-part-5-scale/<

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