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Cyber Report: Privacy Spring from GDPR to Facebook

Bennet Kelley <bkelley@internetlawcenter.net>

Wed 3/28/2018 5:55 AM

To: siliconbeachlawcenter@gmail.com <siliconbeachlawcenter@gmail.com>;

March 28, 2018

Click to view on the web.

PRIVACY SPRING
From the EU's GDPR to the growing Facebook privacy
scandal, privacy is front and center both in the U.S. and
Europe.
 
 

TOP STORY: GDPR IS COMING

May 25th Effective Date
Since 1995, the European Union has been governed by the 1995 Data Protection Directive
(95/46/EC) that is implemented through individual national legislation. In 2016, the European
Commission adopted the EU General Data Protection Regulation that becomes effective May
25, 2018, uniformly across the EU.
 
The test for whether the GDPR applies is not whether you have operations in the EU, but
whether your business: (i) offers products and/or services to EU residents; (ii) monitors the
behavior of EU residents; or (iii) handles the personal data of an EU resident. Thus the GDPR
will ensnare many U.S. companies. See our blog for an overview of the GDPR principles and
requirements.
 
Understand that one of the principles is accountability which is driven by substantial penalties.
Breaches can yield fines up to €20 million ($23.68 million) or 4% of the total worldwide
revenue of the preceding year (whichever is higher).
 
We can assist you in developing GDPR-compliant privacy practices.
 
Related Podcast: CLBR #269: Countdown to GDPR
 

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GDPR Threatens Viability of Internet WHOIS

Database
One of the casualties of GDPR compliance appears to be
the existing ICANN WhoIs database. ICANN was unable
to obtain any consensus on how to alter the database to
comply with GDPR, so it is likely that registrars will chart
their own paths. This may result in some WhoIs information for personal domains being
obscured or limited to selected persons, which has law enforcement and cyber security officials
concerned that it will only reward cyber-criminals. Full story

The Coming Privacy Storm for Tech Giants

In light of the Facebook - Cambridge Analytica scandal,
Senate Judiciary Chairman Chuck Grassley (R-IA) has
called for the CEOs of Facebook, Twitter and Google to
testify at an April 10th hearing on the "future of data
privacy and social media" which may discuss new "rules
of the road" for social media privacy. The Senate
Commerce Committee and the House Energy &
Commerce Committee also are planning hearings in
response to what some have suggested is an "Exxon Valdez" moment.
 
Adding fuel to the fire was Apple's CEO Tim Cook, who stated that he believes that "this certain
situation is so dire and has become so large that probably some well-crafted regulation is
necessary." This follows the tech lobby's recent retreat on Capitol Hill, having reluctantly jumped
on the bandwagon of anti-Backpage legislation they once vehemently opposed.
 
The Facebook scandal also has triggered a Federal Trade Commission investigation and
investigations by 37 state Attorney Generals. It will only add fuel to European efforts to regulate
Big Tech. Full Story.
In this Issue
 
Top Story: GDPR Is Coming.
 
GDPR Threatens Viability of Internet
WHOIS Database
 
The Coming Privacy Storm for Tech
Giants
 
Congress Passes Legislation to Amend
CDA230 Immunity to Address Adult Sites
 
Congress Passes Legislation to Amend ILC NEWS: ILC Cyber Report Named a
Top 50 Internet Law Blog
CDA230 Immunity to Address Adult  
Sites Is Your Contractor an Employee and Why
  it Matters?
Last week, in a 97-2 vote the Senate sent  
legislation amending the immunity provisions of Net Neutrality's Third Act
Section 230 of the Communications Decency Act  
to carve out certain adult sites to President Congress Passes Cloud Act
 
Trump. For purposes of email filters, we must
2018 Cyber Security Threats
refer you to the web version of this newsletter.  
ILC NEWS: Internet Law Center is
representing Cannabis related clients
 
In The Courts: Data Scraping, Removal
of Defamatory Posts, Online Sales Tax,
Airbnb Restrictions
 
Cyber Harassment Courant: Toxic
Twitter, Anti-Harassment
Legislation FTC Lawsuit
Is Your Contractor an Employee and  
FTC Watch: Crackdown on "Influencers,"
Why it Matters? Venmo, Blockchain and New
Commissioners
 

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One mistake startups make, particularly in the  
tech sector, is to misclassify employees as California Employment Law Changes
independent contractors. Employees come with  
costs – tax withholding; paying Social Security, Upcoming Podcasts
 
Medicare and unemployment taxes; overtime
ABOUT THE INTERNET LAW CENTER
(where appropriate) and even benefits – that are & CYBER REPORT
absent with independent contractors.  
   
While it may not always be black or white, the
general rule is that the greater the control the  
would-be employer exercises over the individual
the more likely it is that he or she is an
employee. Getting it wrong can lead to penalties
being assessed by tax and labor authorities. Full
Story

Net Neutrality’s Third Act

In December, the Federal Communications ILC NEWS: ILC Cyber Report

Commission voted to approve Chairman Ajit Pai’s Named a Top 50 Internet Law
“Restoring Internet Freedom” Order (“RIF Order“) Blog
that not only repealed the Obama administration’s
February 2015 “Open Internet Order” that If you have not already done so,
implemented new Net Neutrality rules but for the please follow our Cyber Report blog
first time gave the green light to paid prioritization and our Twitter feed to get the latest
and throttling users so long as it is disclosed. updates on internet law.
   
The Battle now turns to the courts where multiple
lawsuits are challenging the RIF Order; the States
which are passing their own Net Neutrality
legislation; and Congress which must act by late
April. Full Story

  
 

2018 Cyber Security Threats ILC NEWS: Internet Law Center

 
The City of Atlanta is still recovering from a
ransomware attack from last week, which signals
that ransomware will continue to be a top cyber-
security threat in 2018. The Internet of Things
and Mobile Apps will continue to be major
targets. Full Story.
Related Podcast: CLBR #293: Cyber Threats 2018 with
Stan Stahl
 
 
is representing Cannabis
related clients
From corporate formation to
dispensary acquisitions, we have
been representing several clients in
the cannabis and cannabis-related
spaces. See our blog post on the
ramifications of the Justice
Department's repealing the Cole
Memorandum.

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Congress Passes Cloud Act to

Facilitate Cross-Border Sharing of
Electronic Communications
 
The CLOUD Act seeks to permit US law
enforcement authorities to access electronic
records held by US electronic communication
services regardless of where they may be held.
This ends a battle with Microsoft over whether
US authorities could subpoena data stored in
Ireland.
 
The bill also allows the President to enter into Executive Agreements to permit foreign
governments to access data on U.S. soil. The bill is a win for big tech companies who have
been resisting foreign data localization requirements because of the difficulty in gaining access
to such data. The CLOUD Act may blunt the push for data localization and save the industry
substantial sums in data storage costs.
 
Civil libertarians have opposed the bill for permitting foreign governments to access US data
without being subject to judicial oversight. Full Story
 
 

In The Courts: Data Scraping, Removal of

Defamatory Posts, Online Sales Tax, Airbnb
Restrictions
The 9th Circuit recently heard an appeal from a decision
blocking LinkedIn from blocking a company from scraping
publicly available data. Next month, the U.S. Supreme
Court will revisit the standard for applying sales tax in
interstate transactions, while the California Supreme Court
will decide whether Yelp! can be compelled to remove a
defamatory post even if it wasn't a party to the underlying
case. Full Story.
 
One recent opinion of note was a federal court ruling upholding Santa Monica's restrictions on
Airbnb rentals.

Cyber Harassment Courant: Toxic Twitter, Anti-

Harassment Legislation and FTC Lawsuit
Twitter has increasingly come under criticism for failing to
police harassment on its platform, with Amnesty
International charging that its continued failure to protect
women from abuse is a human rights violation.
 
In Congress, several bi-partisan measures to address online harassment and cyber exploitation
are pending, while the FTC has sued an RP site for only the second time. See web version for
details.
 
Related Podcast: CLBR #296: Darieth Chisolm and 50 Shades of Silence
 

FTC Watch: Crackdown on "Influencers",

Venmo, Block Chain and New Commissioners
The Federal Trade Commission has begun enforcement
efforts and is continuing to send warning letters to
influencers who fail to disclose that "they are being paid or
have any other material connection to the brands endorsed
in their posts." I will be co-presenting a Webinar on Social
Media Influencers and the FTC on April 26th.
 
The FTC also has entered into a consent decree with Venmo over deceptive practices regarding
when accounts were credited, publicly displaying user transactions and not having bank-grade

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security as claimed.
 
In addition, the FTC just announced the formation of a Blockchain Workgroup demonstrating its
growing interest in this area.
 
Finally, President Trump has nominated a slate of Commissioners to fill all existing vacancies.
They have been approved by the Senate Commerce Committee and are awaiting confirmation
by the full Senate.
 
Related Podcast: CLBR Season Premier: Bitcoin, Blockchain Hype v Reality with Angela C. Walch

California Employment Law Changes

Employers will no longer be able to ask job applicants
about their past salaries and must disclose the pay scale
for a position upon request. This is to further the state’s
Equal Pay Act which prohibits discrimination in pay for the
same work based on gender, race or ethnicity. Employers
also cannot ask if a prospective employee has a criminal
conviction but may conduct a background check once a
conditional offer has been made. Full Story
 

Upcoming Podcasts
 
Now in its eighth year, Cyber Law & Business Report airs
live Wednesdays at 10AM Pacific on WebmasterRadio.fm
("WMR") and is available to stream or download on WMR
and iTunes, Podbay, Spreaker and Stitcher podcast
channels.
 
Upcoming shows include:

April 4: The Facebook Scandal and "Fexit" with

Dan Tynan and Brenda Christensen
April 18: Prof. Adam Winkler on his new book, We the Corporations: How
American Businesses Won Their Civil Rights
May 2: The Downside of Uber, Airbnb and The Sharing Economy

ABOUT THE INTERNET LAW CENTER

& CYBER REPORT
 
The Internet Law Center is a law firm dedicated to helping businesses navigate the
evolving legal standards for today's digital economy. Today the firm serves a diverse
client base that includes startups and public companies both online and offline across
four continents on issues ranging from online marketing, e-commerce, privacy, domain
names to cyber harassment, as well as entertainment, general transactional and
litigation matters.
 
The Internet Law Center was founded by Bennet Kelley, who has been named as among
the nation's top internet lawyers by several publications including the Los Angeles
Business Journal which named him one of the Most Influential Lawyers in Digital Media
and E-Commerce. We are actively licensed in California and Washington, D.C.
 
Cyber Report is the award-winning newsletter of the Internet Law Center. It is for
information purposes only and is not meant to express any legal opinion or advice (not
even if read backward). No attorney-client or preacher-penitent relationship has been or
will be formed by any communication in connection with this newsletter. The
occasionally snarky views expressed herein do not necessarily reflect the views of the
firm nor any ILC client.
 
100 Wilshire Blvd, Suite 700, Santa Monica, CA 90401
 

   
 

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Bennet Kelley
Internet Law Center
Internet Law Center 100 Wilshire Blvd Suite 700
Santa Monica, CA 90401

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