6/29. The Supreme Court denied certiorari in Cable News Network v. CSC Holdings, a copyright infringement case involving RS-DVR systems. See, Orders List [11 pages in PDF] at page 11.

This lets stand the August 4, 2008, opinion [44 pages in PDF] of the U.S. Court of Appeals (2ndCir), which is also reported at 536 F.3d 121.

The Court of Appeals reversed the judgment of the District Court, and held that CSC's Remote Storage Digital Video Recorder (RS-DVR) system does not violate the Copyright Act by infringing plaintiffs' exclusive rights of reproduction and public performance.

See, story titled "2nd Circuit Reverses in Remote Storage DVR Copyright Case" in TLJ Daily E-Mail Alert No. 1,806, August 5, 2008. This opinion is also reported at 536 F.3d 121.

In May, the Department of Justice's (DOJ) Office of the Solicitor General (OSG) filed an amicus curiae brief with the Supreme Court urging it to deny certiorari. See, story titled "DOJ Urges SCUS to Deny Cert in RS-DVR Case" in TLJ Daily E-Mail Alert No. 1,946, June 2, 2009.

Supporters of the 2nd Circuit's opinion made much of this denial of certiorari. For example, Gary Shapiro, head of the Consumer Electronics Association (CEA), stated in a release that "the Court's decision was a slam-dunk".

Similarly, Gigi Sohn, head of the Public Knowledge, stated in a release that "the Supreme Court has struck a blow for the rights of consumers and for innovation. Consumers will benefit from lower costs and more recording options, while cable companies will see greater efficiencies in their operations".

However, there were many possible reasons for denying certiorari in this case that may not be present in another case when a similar legal question is presented.

The OSG wrote in its brief that "this case does not provide a suitable occasion" to resolve these issues. One reason is that the 2nd Circuit is the first to address the copyright implications of network based analogues to VCRs and set-top DVRs. Also, the OSG wrote that "The parties' stipulations, moreover, have removed two critical issues -- contributory infringement and fair use -- from this case. That artificial truncation of the possible grounds for decision would make this case an unsuitable vehicle for clarifying the proper application of copyright principles to technologies like the one at issue here."

There is also the matter that the Supreme Court grants certiorari when four Justices vote to grant certiorari. These decisions are not made by majority vote. In this case, two Justices (Roberts and Alito) did not participate in the certiorari vote, thus making it harder to achieve the four vote minimum. They may participate in a certiorari vote the next time this issue is presented.

There is also the matter that Thomas Perrelli, the new Associate Attorney General, was until his appointment to the DOJ the Managing Partner of the Washington DC office of the law firm of Jenner & Block, and Co-Chair of its Entertainment and New Media Practice. This firm represents CNN in this case.

Patrick Ross, head of the Copyright Alliance, stated in a release that "Like the lower court's ruling, the U.S. Supreme Court decision is unfortunate and potentially harmful to creators and creative enterprises across the spectrum of copyright industries. We will monitor the ramifications of this decision and continue pushing for policy and legal outcomes that maintain creators' incentives."

This case is Cable News Network, et al. v. CSC Holdings, Inc., et al., Supreme Court, Sup. Ct. No. 08-448, a petition for writ of certiorari to the U.S. Court of Appeals for the 2nd Circuit, App. Ct. Nos. 07-1480-cv(L) and 07-1511-cv(CON). The Court of Appeals heard appeals from the U.S. District Court for the Southern District of New York, Judge Denny Chin presiding. Judge John Walker wrote the opinion of the Court of Appeals, in which Judges Sack and Livingston joined. See, Supreme Court docket.

6/29. The U.S. Court of Appeals (10thCir) issued its opinion [39 pages in PDF] in FTC v. Accusearch, affirming the District Court's injunctive and monetary judgment against the operator of a web site that sold confidential phone records obtained by pretexting practices.

Summary. The Court of Appeals held that the Federal Trade Commission (FTC) has authority under Section 5 of the FTC Act to seek fines and injunctions against those who sell confidential personal information obtained by fraudulent means. This affirms a process that enables the FTC to protect consumer privacy. It is a victory for consumer privacy advocates.

The Court of Appeals also held that the defendants are not entitled to Section 230 immunity. While these defendants did not engage in activity immunized by Section 230, the Court's analysis may further expand the opportunities for the tort bar and activist judges to impose liability on the very sort of web sites that the Congress sought to immunize in enacting Section 230.

The Court of Appeals could have crafted an opinion that employed an analysis that excluded fraud based information brokers such as Accusearch from immunity, without imperiling the free flow of information on beneficial interactive web sites such as collaborative web sites like Wikipedia, message board sites, interactive e-commerce sites like eBay and Amazon, and social networking sites like MySpace. But, it did not.

None of the interactive web sites that fall within the meaning of Section 230, that the Congress sought to protect, and that contribute to the success of the internet as a source of useful information, participated in the case, either as parties or amici. The Court of Appeals only received the arguments of a fraud based information broker, a U.S. agency charged with protecting consumers against fraud, and an amicus curiae Canadian agency charged with protecting consumer privacy.

This opinion does not inflict the same scope of damage to the interactive web as the 9th Circuit's April 3, 2008, en banc opinion [PDF] in FHCSFV v. Roommates.com, 521 F.3d 1157, or its June 22, 2009, amended opinion [PDF] in Barnes v. Yahoo. But, it too is another opinion that incrementally chips away at the immunity provided by Section 230, and the benefits that this immunity provides.

Background. Accusearch, Inc., a Wyoming corporation, is the operator of an information brokerage web site named Abika.com. Its owner, sole officer and director is Jay Patel.

The District Court wrote that it has offered for sale personal information, including confidential phone records, GPS traces disclosing the locations of cell phones, social security number verification, utility records, Department of Motor Vehicle (DMV) records, and reverse e-mail lookups. It obtained these records by fraudulent practices known as pretexting.

The Court of Appeals wrote that "the search services offered on Abika.com were primarily services provided by third-party researchers, who were required by Accusearch to provide assurances that they would perform their work in accordance with applicable law." It added that "Acquisition of this information would almost inevitably require someone to violate the Telecommunications Act or to circumvent it by fraud or theft."

The Court of Appeals continued that "The researchers had no direct contact with Abika.com's customers". Rather, customers paid Accusearch a search fee, which "would forward the search request to a researcher who could fulfill it". The researcher would forward the information to Accusearch, which would provide it to the customer.

On July 7, 2005, the Electronic Privacy Information Center (EPIC) filed a complaint with the FTC requesting that it "initiate an industry-wide investigation into online investigation sites", including Abika.com. See, story titled "EPIC Complains to FTC About Online Information Brokers" in TLJ Daily E-Mail Alert No. 1,171, July 11, 2005.

District Court Proceedings. On May 1, 2006, the Federal Trade Commission (FTC) filed a civil complaint [7 pages in PDF] in the U.S. District Court (DWyo) alleging violation of Section 5 of the FTC Act, which is codified at 15 U.S.C. § 45(a)(1).

Section 5 is a general grant of authority to prevent unfair or deceptive practices in interstate commerce. It provides, in part, that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful."

The complaint referenced, but did not plead violation of, 47 U.S.C. § 222, which requires that telecommunications carriers must protect the confidentiality of consumer proprietary network information (CPNI), which includes calling history and activity, billing records, and unlisted telephone numbers of service subscribers.

Section 222 only regulates the conduct of carriers. It provides, in part, that "a telecommunications carrier that receives or obtains customer proprietary network information by virtue of its provision of a telecommunications service shall only use, disclose, or permit access to individually identifiable customer proprietary network information in its provision of (A) the telecommunications service from which such information is derived, or (B) services necessary to, or used in, the provision of such telecommunications service, including the publishing of directories."

On September 28, 2007, the District Court signed its order [22 pages in PDF] granting the FTC's motion for summary judgment, and denying Accusearch's motion for summary judgment.

The District Court rejected Accusearch's assertion of Section 230 immunity. Section 230 was enacted as part of the Communications Decency Act (CDA), which was a part of the Telecommunications Act of 1996.

Section 230(c)(1) provides that "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider."

The District Court held that Accusearch operates an interactive computer service, but that the FTC's complaint does not seek to treat Accusearch as a publisher. Moreover, it held that the original records were created by phone companies, and misappropriated as a result of Accusearch's efforts, and that Accusearch participated in the creation or development of the information sold to its customers. Hence, the complaint did not treat Accusearch as the "publisher or speaker of any information provided by another information content provider".

The District Court found that Accusearch violated Section 5 of the FTC Act.

On December 20, 2007, the District Court signed its Order and Judgment for Permanent Injunction and Other Equitable Relief [14 pages in PDF]. It banned defendants from selling phone records. It also awarded the FTC a monetary judgment of $l99,692.71.

Court of Appeals: FTC Act. Defendants brought the present appeal. It argued that it broke no law, that the FTC lacks authority to enforce Section 222, and that it has immunity under Section 230. It also argued that the injunction was unnecessary and unconstitutional for overbreadth.

Edward McNicholas, of the Washington DC office of the law firm of Sidley Austin, filed an amicus curiae brief for Jennifer Stoddart, Privacy Commissioner of Canada, urging affirmance of the judgment of the District Court.

This brief primarily argues for the protection of consumer privacy. However, it also argues that Section 230 immunity is inapplicable in this case. It relies upon the 9th Circuit's Roommates.com opinion.

The Court of Appeals affirmed. Judge Harris Hartz wrote the majority opinion.

The Court of Appeals wrote that "the FTCA enables the FTC to take action against
unfair practices that have not yet been contemplated by more specific laws", but that "violations of law may be relevant to the unfairness analysis".

It continued that "the FTC alleged that the substantial-injury element of an unfair practice, see 15 U.S.C. § 45(n), was met partly by the subversion of consumer privacy protections afforded by the Telecommunications Act. But the existence of that injury turns on whether the Telecommunications Act was violated (by somebody), not on whether Accusearch could itself be held liable under the Telecommunications Act." (Parentheses in original.)

Moreover, "the FTC may proceed against unfair practices even if those practices violate some other statute that the FTC lacks authority to administer". In the case of Section 222 violations, the Federal Communications Commission (FCC) is the agency with enforcement authority.

Court of Appeals: Section 230. The Court of Appeals also rejected Accusearch's Section 230 immunity argument. First, on the issue of whether Accusearch is an "interactive computer service" within the meaning of Section 230 (the District Court held that it is), the Court of Appeals declined to rule.

An unresolved issue is whether to qualify as an "interactive computer service" one must allow interaction among the users. Accusearch did not allow this interaction. The statute does not require this. Nevertheless, the FTC argued that it is necessary. The Court of Appeals wrote, "we leave it to another day".

Second, the Court of Appeals addressed whether the complaint treats Accusearch as a publisher. The District Court concluded that it does not. The Court of Appeals did not decide.

Although, Judge Tymkovich wrote in his concurring opinion that "the FTC sought and ultimately held Accusearch liable for its conduct rather than for the content of the information it was offering on the Abika.com website. Section 230 only immunizes publishers or speakers for the content of the information from other providers that they make public. ... The CDA says nothing about immunizing publishers or speakers for their own conduct in acquiring the information."

Third, the Court of Appeals addressed, and based its affirmance upon, the issue of whether the complaint treated Accusearch as the "publisher or speaker of any information provided by another information content provider".

Section 230 defines "information content provider" as "any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service."

The Court of Appeals focused on the words "responsible" and "development", neither of which are defined by the statute.

It concluded that "a service provider is ``responsible´´ for the development of offensive content only if it in some way specifically encourages development of what is offensive about the content." (Emphasis added by TLJ.)

Applying this vague standard, the Court of Appeals concluded that Accusearch was "responsible", and hence was itself an "information content provider" not entitled to immunity.

The Court of Appeals then held that the District Court's injunction was appropriate.

Court of Appeals: Concurring Opinion. Judge Timothy Tymkovich wrote a concurring opinion.

He wrote regarding the majority's "unnecessary extension of the CDA's terms ``responsible´´ and ``development,´´ thereby widening the scope of what constitutes an ``information content provider´´ with respect to particular information under the Act."

He continued that "The majority holds that by soliciting third-parties to obtain and then exposing the confidential telephone records to public view, Accusearch is responsible -- at least in part -- for developing that information. Under this definition, the line between passive posting of tortious or unlawful commentary, news articles, or other previously unpublished information and content development depends on an amorphous analysis of the motivations of the content provider in soliciting or acquiring that information. In the majority’s view, a content provider seeking out the information in good faith may be able to obtain CDA immunity for any subsequent liability, as it would not have been “responsible, in whole or in part, for the . . . development of [that] information.” § 230(f)(3). If the provider’s motivations are not in good faith, however, the majority’s approach transforms the provider into a developer of that information."

He argued that "the FTC’s allegations of FTCA violations stemmed not from the content of the information Accusearch was disclosing (or developing), but from Accusearch’s own conduct in (1) offering the information for sale, (2) soliciting and encouraging third-parties to violate the law in obtaining the information, and (3) ultimately paying these third parties and selling the information to consumers. Accusearch’s duty to refrain from engaging in these unfair business practices does not derive from its status or conduct as an Internet website that publishes content." (Footnote omitted.)

Rather, Tymkovich, cited the 9th Circuit's Barnes opinion, wrote that "the duty the FTC alleged Accusearch violated derives from the expectations that a business would not engage in unlawful or unfair business practices in general (whether the business is a conventional bricks-and-mortar operation or exists entirely on the World Wide Web)." (Parentheses in original.)

That is, "While Internet publication of the confidential phone data, by itself, may very well be protected by the CDA, the CDA does not immunize, expressly or implicitly, the manner in which Accusearch conducted its business. In sum, the CDA does not extend to immunize a party’s conduct outside the realm of the Internet just because it relates to the publishing of information on the Internet.

Thus, Tymkovich argued that "I would limit the analysis to whether the CDA even applies in the first place. I would conclude that it does not, and that Accusearch therefore was liable for its unfair business practices in violation of the FTCA."

TLJ Commentary. This case is victory for consumer privacy advocates. It confirms that the FTC can use its broad Section 5 authority to pursue information brokers.

However, it should be recalled that this case was commenced in May of 2006. It followed the EPIC's disclosures regarding the activities of information brokers. Also, shortly after the filing of the complaint, the Congress began its investigation of Hewlett Packard pretexting scandal, and the activities of information brokers generally.

The Congress followed through by enacting a pretexting specific criminal statute -- HR 4709, the "Telephone Records and Privacy Act of 2006". It was signed into law on January 12, 2007. It is now Public Law No. 109-476. It is codified at 18 U.S.C. § 1039(a)(3).

The Department of Justice (DOJ) is enforcing it. See, story titled "District Court Imposes 21 Month Prison Sentence for Phone Record Pretexting" in TLJ Daily E-Mail Alert No. 1,954, June 12, 2009. This criminal statute, along with heightened security practices by carriers, has lessened the importance of an FTC process.

This opinion also holds that Accusearch is not entitled to Section 230 immunity. This too is a victory for consumer protection advocates. However, the Court of Appeals analysis may also create increased potential for imposition of liability upon the very sort of interactive web sites that Section 230 was enacted to prevent.

First, it should be noted that the majority opinion, like the Canadian amicus brief, relies upon the 9th Circuit's opinion in Roommates.com. The concurrence relies upon the 9th Circuit's opinion in Barnes v. Yahoo. In these opinions the Judges of the 9th Circuit did not apply the statute. Rather, they have a fundamental difference of policy objectives with the Congress, and are engaging in incremental judicial slight of hand to limit the immunity provided by the statute. It is not encouraging for the future of an open and interactive web unhindered by tort litigation that another circuit is relying upon these 9th Circuit opinions.

For more information on Roommates.com, see stories titled "9th Circuit Holds Roommates.com May be Liable for Speech of Users" in TLJ Daily E-Mail Alert No. 1,581, May 15, 2007; "9th Circuit to Rehear Section 230 Case En Banc" in TLJ Daily E-Mail Alert No. 1,657, September 18, 2007; and "En Banc 9th Circuit Panel Rejects Section 230 Immunity in Roommates.com Case" in TLJ Daily E-Mail Alert No. 1,741, April 2, 2008. For more information on Barnes v. Yahoo, see story titled "9th Circuit Again Rejects Section 230 Defense" in TLJ Daily E-Mail Alert No. 1,962, June 29, 2009.

Second, the majority opinion in the present case provides an analysis that tort lawyers, and like minded members of the judiciary, will cite in future cases to limit or deny Section 230 immunity.

The majority's standard, that a web site has no immunity "if it in some way specifically encourages development of what is offensive about the content", is both vague and far reaching. Encouragement and offensiveness are amorphous concepts. Moreover, the sort of web sites that make the web dynamic and informative encourage, rather than discourage, users to post comments and other content. Also, when plaintiffs file suits, they allege the occurrence of something offensive. Plaintiffs' lawyers will always be able to allege encouragement and offensiveness.

This standard provides less certainty and less predictability as to whether Section 230 will be afforded. It also creates a higher expectation that immunity will be denied. All this will disincent web site operators from providing interactive features, or lead them to charge higher prices for them to cover anticipated liabilities.

This case is FTC v. Accusearch, Inc., dba Abika.com, and Jay Patel, U.S. Court of Appeals for the 10th Circuit, App. Ct. No. 08-8003, an appeal from the U.S. District Court for the District of Wyoming, D.C. No. 2:06-CV-00105-WFD. Judge Hartz wrote the opinion of the Court of Appeals, in which Judge Holmes joined. Tymkovich wrote a concurring opinion.

The House will not meet the week of June 29 through July 3. It will next meet on July 7, 2009, at 2:00 PM.

The Senate will not meet the week of June 29 through July 3. It will next meet on July 6, 2009, at 2:00 PM. See, Senate calendar.

10:00 AM. The Center for Democracy and Technology (CDT) will host a news briefing titled "The Emerging Privacy Landscape: Will Congress Enact Broad-based Consumer Privacy Legislation This Year?". The speakers will include Leslie Harris, Ari Schwartz, and Alissa Cooper of the CDT. To participate by phone, call 800-377-8846; the participant code is 92874158#. Breakfast will be served. Location: CDT, 1634 I St., NW.

12:15 - 1:30 PM. The Federal Communications Commission (FCC) will host a brown bag lunch titled "Bridging the Gap: Transactions 101 -- An Introduction to Communications Transactions and Related FCC Oversight". The speakers will be Neil Dellar (FCC Office of the General Counsel) and Mark Brennan (Hogan & Hartson). For more information, contact Sarah Reisert at spreisert at hhlaw dot com. The Federal Communications Bar Association (FCBA) states that this is a FCBA event. Location: Hogan & Hartson, 555 13th St., NW.

Target date for the Office of the U.S. Trade Representative's (OUSTR) to announce modifications to the list of articles eligible for duty free treatment under the GSP resulting from the OUSTR's 2008 Generalized System of Preferences (GSP) Annual Review. See, notice in the Federal Register, September 12, 2008, Vol. 73, No 178, at Pages 53054-53056.

Deadline to submit comments to the Office of the U.S. Trade Representative (OUSTR) regarding the complaints filed with the World Trade Organization (WTO) by Canada and Mexico regarding U.S. country of origin labeling requirements. See, notice in the Federal Register, May 22, 2009, Vol. 74, No. 98, at Pages 24059-24061.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Notice of Inquiry (NOI) regarding commercial use of a radio audience measurement device developed by Arbitron named the portable people meter (PPM). The FCC adopted this NOI on May 15, 2009, and released the text on May 18, 2009. It is FCC 09-43 in MB Docket No. 08-187. See, public notice DA 09-1231, and notice in the Federal Register, June 1, 2009, Vol. 74, No. 103, at Pages 26235-26241.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding its SP 800-53 Rev. 3 [220 pages in PDF] titled "Recommended Security Controls for Federal Information Systems and Organizations".

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Technology Innovation Program Advisory Board in advance of its July 7, 2009, meeting "regarding general policy for the Technology Innovation Program, its organization, its budget, and its programs within the framework of applicable national policies as set forth by the President and the Congress". See, notice in the Federal Register, June 23, 2009, Vol. 74, No. 119, at Pages 29675-29676.

10:00 AM. The Federal Communications Commission (FCC) may hold an event titled "Open Meeting". See, agenda. Location: FCC, Room TW-C305, 445 12th St., NW.

Federal Holiday. See, OPM list of holidays.

Independence Day.

The House will not meet.

10:00 AM. The U.S. Court of Appeals (FedCir) will consider on the briefs Orenshteyn v. Citrix Systems, App. Ct. No. 2003-1427. Location: Courtroom 201.

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding the March 12, 2009, petition filed by Denali Spectrum License Sub, LLC asking the FCC to forbear from applying the unjust enrichment provisions of the FCC's competitive bidding rules. See, notice in the Federal Register, June 9, 2009, Vol. 74, No.109, at Pages 27318-27319.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its public notice regarding technical specifications for FM digital audio broadcasting (DAB). This public notice is DA 09-1127 in MM Docket No. 99-325. See, notice in the Federal Register, June 12, 2009, Vol. 74, No. 112, at Pages 27985-27988.

The House will return from its Independence Day District Work Period.

8:30 AM - 3:00 PM. The National Institute of Standards and Technology's (NIST) Technology Innovation Program Advisory Board will meet. See, notice in the Federal Register, June 23, 2009, Vol. 74, No. 119, at Pages 29675-29676. Location: NIST, Administration Building, Employees' Lounge, Gaithersburg, MD.

TIME? The Department of State's (DOS) International Telecommunication Advisory Committee (ITAC) will meet to discuss the International Telecommunication Union's (ITU) Regional Preparatory Meeting for the World Telecommunication Development Conference on August 13-25, 2009 in Lima, Peru. See, notice in the Federal Register, June 22, 2009, Vol. 74, No. 118, at Pages 29529-29530. Location: AT&T, 10th floor, 1120 20th St., NW.

Effective date of the Federal Communications Commission's (FCC) final rule regarding the reconfigured 800 MHz band plan established for the U.S.-Canada border contained in the Fourth Memorandum Opinion and Order released on February 25, 2009. This 4thMO&O is DA 09-442 in WT Docket No. 02-55. See, notice in the Federal Register, May 5, 2009, Vol. 74, No. 85, at Pages 20602-20605.

6/26. The U.S. Court of Appeals (9thCir) issued its opinion [14 pages in PDF] in Cadkin v. Loose, holding that a defendant is not entitled to attorney's fees as a prevailing party under 17 U.S.C. § 505 when a plaintiff voluntarily dismisses without prejudice a lawsuit containing copyright claims.

This is a case involving claims of copyright infringement. The plaintiffs voluntarily dismissed. The defendants sought attorneys fees as the prevailing party, which the District Court awarded. This appeal followed.

Section 505 of the Copyright Act provides that "In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney’s fee to the prevailing party as part of the costs."

The Court of Appeals reversed. It held that the 9th Circuit's 1941 opinion in Corcoran v. CBS, 121 F.2d 575, a copyright case on point, is "no longer good law" in light of the Supreme Court's 2001 opinion in Buckhannon v. West Virginia Department of Health and Human Resources, 532 U.S. 598.

Buckhannon was a Fair Housing Amendments Act (FHAA) case in which the Supreme Court held that prevailing party status turns on whether there has been a material alteration of the legal relationship of the parties.

The Court of Appeals wrote that "Because the plaintiffs in this lawsuit remained free to refile their copyright claims against the defendants in federal court following their voluntary dismissal of the complaint, we hold the defendants are not prevailing parties and thus not entitled to the attorney's fees the district court awarded them."

This case is Emil Cadkin, et al. v. Erma Loose, et al., U.S. Court of Appeals for the 9th Circuit, App. Ct. No. 08-55311, an appeal from the U.S. District Court for the Central District of California, D.C. No. CV-03-01591-JVS, Judge James Selna presiding. Judge Raymond Fisher wrote the opinion of the Court of Appeals, in which Judges Betty Fletcher and Ronald Gould joined.

6/26. John Joseph Rendzia, Jr., pled guilty in, and was sentenced by, the U.S. District Court (EDVa) for embezzlement and conversion of a laptop computer.

Rendzia was at the relevant time a Department of Homeland Security (DHS) Customs and Border Patrol (CBP) supervisor at the Philadelphia International Airport. He embezzled the laptop from an airline passenger, and converted it to his own use. See, Department of Justice (DOJ) release.

Numerous bills were introduced in the 110th Congress to limit DHS/CBP laptop searches. Several have already been introduced in the 111th Congress. See, story titled "Summary of Bills Regarding DHS/CBP Laptop Searches" in TLJ Daily E-Mail Alert No. 1,953, June 11, 2009.

On January 7, 2009, Rep. Eliot Engel (D-NY) and Rep. Ron Paul (R-TX), introduced HR 239 [LOC | WW], the "Securing our Borders and our Data Act of 2009". Also, on March 26, 2009, Rep. Loretta Sanchez, and others, introduced HR 1726 [LOC | WW], the "Border Security Search Accountability Act of 2009". She also introduced a bill in the last Congress. See, story titled "Rep. Sanchez Introduces Bill Regarding Customs Searches of Laptops" in TLJ Daily E-Mail Alert No. 1,825, September 15, 2008.

Also in the 110th Congress, on September 26, 2008, Sen. Russ Feingold (D-WI), introduced S 3612 [LOC | WW], the "Travelers' Privacy Protection Act of 2008". The companion bill in the House was HR 7118 [LOC | WW], introduced by Rep. Adam Smith (D-WA). Also, on July 23, 2008, Rep. Zoe Lofgren (D-CA) introduced HR 6588 [LOC | WW], the "Electronic Device Privacy Act of 2008".

See also, stories titled "Summary of Cases Regarding DHS/CBP Laptop Searches" and "ACLU Seeks DHS Records Regarding Unwarranted Laptop Searches" in TLJ Daily E-Mail Alert No. 1,953, June 11, 2009.

6/26. The U.S. Court of Appeals (6thCir) issued its opinion in Keweenah Bay Indian Community v. Rising, a declaratory judgment action regarding Indian immunity from state taxation under the federal Constitution's commerce clause. The Court of Appeals remanded the case to the District Court to develop the factual record.

State legislatures and tax collectors seek to increase tax collections, particularly from people and entities that lack influence in the state legislature. This frequently involves out of state businesses and consumers, as well as in state discrete and insular minorities who lack the normal protections of the political process.

This case involves in state Indians, and the out of state businesses with which they do business online.

The extent of state authority to tax out of state businesses, such as Amazon.com, that have no presence in the taxing state, but which sell over the internet, is the subject of other disputes. The Supreme Court's 1992 opinion in Quill v. North Dakota, 504 U.S. 298, seemingly precludes such taxation, but states nevertheless seek to collect taxes through these online retailers.

The Quill opinion is based in large part upon the commerce clause. The commerce clause is also the main line of defense for internet businesses against state regulation of e-commerce.

For the present case, it must be recalled that the commerce clause contains a further limitation upon state authority in the context of Indians.

The commerce clause provides that "The Congress shall have Power ... To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes".

The Keweenaw Bay Indian Community is a federally recognized Indian tribe located in the state of Michigan. Despite the commerce clause, Michigan is taxing it and its members.

The Court of Appeals wrote that "Michigan has apparently adopted a policy of taxing transactions involving the Community or its members, while permitting them to apply to the Treasury for an exemption or refund on a case-by-case basis".

The Community and its members have claimed exemptions. The state has retaliated by withholding federal funds, held by the state, and owed to the Community.

The Community filed a complaint in the U.S. District Court (WDMich) against Jay Rising and other Michigan officials, seeking declaratory and injunctive relief from Michigan's collection of sales and use taxes on transactions involving the Community or its members. It also sought damages under 42 U.S.C. § 1983. The District Court granted summary judgment to Michigan on all claims. This appeal followed.

The Court or Appeals ruled that the factual record developed by the District Court in this case is too thin . "Because the questions presented cover a myriad of hypothetical
transactions and are too broad, too abstract, and unsupported by specific facts, the relief requested cannot be granted at this time. Lacking a specific factual context, the questions are not justiciable."

It held that the Community is not entitled to the declaratory and injunctive relief it requests at this time. It remanded to the District Court. It added that "it is possible that such relief may ultimately be attained through appropriately fact-specific litigation."

The Court of Appeals also commented specifically about the lack of a factual record on the subject of internet transactions.

It wrote that "it may be that there are a large number of sales in which there is a legitimate dispute over whether the sale takes place within Indian country or not. For example, what happens when an Indian orders a product or service online -- say a magazine, book, educational service, or any one of hundreds of similar items -- pays for it using a debit card that draws from a bank outside of Indian country, and the product is delivered within Indian country? That question, and similar variations thereof, have not been resolved and are not properly before us."

This case may return to the Court of Appeals.

This case is Keweenah Bay Indian Community v. Jay Rising, et al., U.S. Court of Appeals for the 6th Circuit, App. Ct. No. 08-1585, an appeal from the U.S. District Court for the Western District of Michigan, at Marquette, D.C. No. 05-00224, Judge Gordon Quist presiding. Judge Merritt wrote the opinion of the Court of Appeals, in which Judges Griffin and Kethledge joined.

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