Apple-Samsung Case Muddies the Future of Innovation

The following is an excerpt from an article in 

The New York Times
Monday, August 27, 2012

Apple-Samsung Case Muddies the Future of Innovation

By NICK WINGFIELD

Apple’s victory on Friday in a patent lawsuit against Samsung could, if upheld, give its rivals a kick in the pants to create more original products.

Whether consumers respond by buying the more distinctive devices is another question entirely.

Consider the case of Windows Phone, Microsoft’s operating system for smartphones, which looks almost nothing like the Apple software for iPhones and iPads. Reviewers have praised Windows Phone for its fresh, distinctive design, with bold typography and a tile system for using phone functions.

But the phones, including the Lumia 900 from Nokia, have not sold well.

Microsoft’s product has not gained traction for a number of possible reasons, among them the big lead its rivals had in the marketplace and the relatively weak distribution of its main partner, Nokia. But the experience shows that any flourishing of innovative products prompted by the Samsung verdict may not translate into success for Apple’s rivals.

People across the technology industry have expressed concerns about the future of innovation after a nine-person jury ruled in Apple’s favor last week in Federal District Court in San Jose, Calif. The jury said Samsung smartphone and tablet products violated a series of Apple patents protecting a number of designs and functions — including the rectangular shape and rounded edges of the iPhone and the pinch-to-zoom gesture that magnifies an image on Apple devices.

For more, visit www.nytimes.com.

Google Faces Class-Action Lawsuits Over New Privacy Policy

Google faces consumer complaints in federal courts in New York and California that claim that its new privacy policy violates the company's earlier policies which promised that information provided by a user for one service would not be used by another service without the consumer's consent.

The Internet company is being charged in both lawsuits for violation of the Federal Wiretap Act, for wilful interception of communications and aggregation of personal information of its consumers for financial benefit, and the Stored Electronic Communications Act for exceeding its authorized access to consumer communications stored on its systems. Google is also charged with violation of the Computer Fraud Abuse Act, and other counts including state laws.

The plaintiffs in both suits seek to bring nationwide class action on behalf of holders of Google accounts and owners of Android devices from Aug. 19, 2004 to Feb. 29, 2012, who continued to maintain the Google accounts and own the devices after the new privacy policy came into effect on March 1 this year.

For more, click the link below:

http://www.pcworld.com/article/252332/google_faces_classaction_lawsuits_over_new_privacy_policy.html#tk.nl_bdx_h_crawl

Facebook: Risk & Riches

Excerpt from an article in

The New York Times

Monday, February 27, 2012

For Facebook, Risk and Riches in User Data

By SOMINI SENGUPTA

SAN FRANCISCO — It is Facebook’s biggest conundrum. As the world’s largest social network, it faces intense scrutiny from consumers, courts and regulators worldwide over how it handles the data it collects from its 845 million users. But as a company preparing to go public, it is under pressure to find new ways to turn that data into profit.

The scrutiny is at its most intense in Europe. Regulators in Ireland, where Facebook has its European headquarters, have already demanded that it give users greater control over their information. A proposed Europe-wide law goes much further by requiring Facebook, along with every other online business, to expunge every bit of personal data at a consumer’s request.

In the United States, Facebook faces government audits for the next 20 years about how it collects and shares data, along with an assortment of lawsuits that accuse the company of tracking users across the Web. Even the White House stepped into the fray last week, demanding that Web companies give users more say in how their personal data is used.

Facebook is not the only company dealing with these issues, but it is especially vulnerable because its very business model relies on the fire hose of information that its users willingly share. “We are in very turbulent and unpredictable times when it comes to privacy regulations,” said J. Trevor Hughes, a lawyer who leads the International Association of Privacy Professionals. “We see regulators with a sense that something needs to be managed better, but without the tools.”

The result is a cloud of uncertainty for Facebook, which is expected to go public this spring. Among the risk factors listed in Facebook’s filing for a public offering is the prospect of “adverse changes in our products that are mandated by legislation, regulatory authorities, or litigation, including settlements or consent decrees.”

Neither Admit Nor Deny

Excerpt from an article in The New York Times
Saturday, February 25, 2012

‘Neither Admit Nor Deny’ Settlements Draw Judges’ Scrutiny 

By EDWARD WYATT

WASHINGTON — The entrenched practice of allowing companies and individuals to settle federal regulatory charges without admitting that they actually did anything wrong is coming under growing scrutiny by the courts.

Two federal judges have questioned such settlements proposed by the Securities and Exchange Commission and this week a third judge held up a settlement offered by the Federal Trade Commission.

Judge Renee Marie Bumb of United States District Court in Camden, N.J., blocked a proposed settlement on Wednesday between the Federal Trade Commission and a marketing company based in New Jersey on charges that the company and its chief executive made false and unsubstantiated claims that the use of açaí berry-based products, which they promoted, would result in rapid and substantial weight loss.

Judge Bumb ordered both the commission and the company to justify why she should approve the proposed $11.5 million settlement when the lack of an admission by the company and the executive of any wrongdoing left her with no facts with which to judge whether the negotiated deal was fair, adequate and in the public interest.

In doing so, she cited a much-discussed case involving the S.E.C. and Citigroup. Last November, Judge Jed S. Rakoff of Federal District Court in New York rejected a proposed $285 million settlement of securities fraud charges for the same reason: without an admission of guilt or agreed-upon facts there was no basis for an approval.

And on Friday, an S.E.C. commissioner, Luis A. Aguilar, told a group of securities lawyers that a recent attempt to tighten the agency’s policy of allowing a company to settle a fraud case while neither admitting nor denying any wrongdoing “applies in so few situations, it needs to be revised to be more useful and effective.”

While another S.E.C. case in Wisconsin, where a federal district judge in December challenged an S.E.C. settlement, was subsequently approved, the cases demonstrate that Judge Rakoff’s challenge of the “neither admit nor deny” settlement is reverberating beyond Wall Street and New York.

That is not what securities law experts expected last November, when Judge Rakoff issued the ruling.

At the time, the consensus was that the decision was unlikely to affect cases involving other regulatory agencies or in other jurisdictions.

Because the proposed settlements included a permanent injunction against further wrongdoing by the defendants, they are subject to approval from a federal judge. But Judge Rakoff argued that the judiciary should not be considered a rubber stamp to approve executive-branch enforcement cases.

Lawyers both inside and outside the S.E.C. argued that the “neither admit nor deny” settlements were perhaps the only way to get companies to settle fraud cases, because to admit wrongdoing would open them to civil damages. (Emphasis added by me.)

An appeal of Judge Rakoff’s decision by the S.E.C. is pending at the Second Circuit Court of Appeals in New York.