Consumer Law & Policy Blog

DC Court of Appeals Allows Interlocutory Appeals of Denials of Special Motions to Quash Under SLAPP Law

by Paul Alan Levy

The DC Court of Appeals has reversed the denial of a special motion to quash a subpoena seeking to identify the anonymous defendant in a defamation action.  The suit, Burke v. Doe, was brought by  lawyer Susan Burke, who complained that her Wikipedia entry had been modified to include false statements relating to a prominent civil action that she had brought seeking damages from Blackwater for actions arising from its federal contracts in Iraq.  Although the panel was at pains to say that it was not addressing the appealability of special motions to dismiss under the statute, much of its reasoning would apply equally to appeals from those motions.

The FDA is ramping up its regulation of indoor tanning because of melanoma risks and risks to minors

Read about it here. For more information, click on this link to an ABC news report or on the embedded video below. Under the new FDA regs, tanning beds must have a black-box warning about cancer risks and saying that minors should not use them. (A black-box warning is the most serious FDA warning, usually reserved for use on drug-package inserts to warn of particularly serious side-effects or other drug-related hazards.)

ABC US News | ABC International News 

Nevada Trial Judge Limits Default Judgment Against Host of Critical Comments – Was the Relief Awarded Still Too Much?

by Paul Alan Levy

In an intriguing ruling last week granting relief by consequence of a default judgment, a federal judge in Nevada engaged in a fair amount of sua sponte analysis in paring down the relief sought against the operator of a web site that hosts reviews of colleges and universities.  The opinion included an excellent discussion of the reasons to be wary of granting injunctive relief against criticism contained on consumer review web sites.  The court appears, however, to have missed one significant issue: the impact of Section 230 on the available relief.

Can recent Federal Arbitration Act jurisprudence help the union movement?

That's the question asked by law professor Ann Hodges in Trilogy Redux: Using Arbitration to Rebuild the Labor Movement. Here is the abstract:

The Supreme Court is in the midst of a revolution in arbitration jurisprudence comparable to that reflected in the Steelworkers Trilogy in 1960. While the Trilogy was hailed as a major accomplishment in labor relations, the current revolution is devastating the rights of nonunion workers and consumers. The Court’s evisceration of the class action through approval of waivers in unilaterally imposed arbitration agreements has forced employees and consumers to individually arbitrate legal claims. While plaintiffs’ attorneys are quick to file class actions in court, they are far less interested in individual arbitration cases. This development may provide an opportunity for labor unions to step in and offer assistance to workers with these claims. This paper discusses several ways that unions might capitalize on this development to grow the labor movement, considering the advantages and disadvantages of possible options. Whichever is chosen, however, it is crucial that providing representation to workers with legal claims is only one piece of a larger strategy. The strategy must be designed to build a worker-driven movement capable of meeting the needs of 21st century workers and providing balance to the power of 21st century wealth. To achieve this objective, unions cannot be merely service organizations for members. Instead, they must be part of a broader movement for workplace equality.

FTC Raises Concerns About Data Brokers and Consumer Privacy

The Federal Trade Commission yesterday issued a report on the “fundamental lack of transparency” in the data broker industry. The FTC’s press release provides a good summary:

The report, “Data Brokers: A Call for Transparency and Accountability” is the result of a study of nine data brokers, representing a cross-section of the industry, undertaken by the FTC to shed light on the data broker industry. Data brokers obtain and share vast amounts of consumer information, typically behind the scenes, without consumer knowledge. Data brokers sell this information for marketing campaigns and fraud prevention, among other purposes. Although consumers benefit from data broker practices which, for example, help enable consumers to find and enjoy the products and services they prefer, data broker practices also raise privacy concerns.

“The extent of consumer profiling today means that data brokers often know as much – or even more – about us than our family and friends, including our online and in-store purchases, our political and religious affiliations, our income and socioeconomic status, and more,” said FTC Chairwoman Edith Ramirez. “It’s time to bring transparency and accountability to bear on this industry on behalf of consumers, many of whom are unaware that data brokers even exist.”

The report finds that data brokers collect and store billions of pieces of data covering nearly every U.S. consumer. One data broker studied by the FTC holds information on more than 1.4 billion consumer transactions. Another adds more than 3 billion new data points to its database each month.

Among the report’s findings:

Data brokers collect consumer data from extensive online and offline sources, largely without consumers’ knowledge, ranging from consumer purchase data, social media activity, warranty registrations, magazine subscriptions, religious and political affiliations, and other details of consumers’ everyday lives.

Consumer data is often shared among many data brokers.

Data brokers combine and analyze data about consumers to make inferences about them, including potentially sensitive inferences such as those related to ethnicity, income, religion, political leanings, age, and health conditions.

Many of the purposes for which data brokers collect and use data pose risks to consumers, such as unanticipated uses of the data.

To address its concerns, the FTC recommends that Congress enact legislation to make data broker practices more transparent to consumers and to give consumers greater control over the immense amounts of personal information collected and shared by data brokers.

 

Affordable Care Act increasingly seen as a good business opportunity for health insurers

Health insurers that were originally wary of participating in the Affordable Care Act's "exchanges" now are changing their tune, seeing the Act as an opportunity for new business, as explained in this article by Reed Abelson.

An additional tidbit on tribal sovereign immunity and payday lending

Scott noted earlier today that the California Supreme Court will hear a case posing the following question: Is a payday lender that is formally owned by a Native American tribe but run by a third-party who keeps most of the proceeds protected by tribal sovereign immunity?

So, the U.S. Supreme Court just this morning issued a decision about tribal immunity. In Michigan v. Bay Mills Indian Community, the Court considered, among other things, whether one of the Court's earlier decisions (Kiowa) broadly interpreting the scope of tribal sovereign immunity should be overruled. The Court reaffirmed Kiowa in a 5-4 ruling, with Justice Thomas authoring the principal dissent. His dissent notes (in footnote 4) that lower courts have broadly interpreted tribal sovereign immunity to include not only tribes but also "arms of tribes" like tribal casino development authorities. He also addressed (on page 12) the payday lending issue:

In the wake of Kiowa, tribal immunity has also been exploited in new areas that are often heavily regulated by States. For instance, payday lenders (companies that lend consumers short-term advances on paychecks at interest rates that can reach upwards of 1,000 percent per annum) often arrange to share fees or profits with tribes so they can use tribal immunity as a shield for conduct of questionable legality. Martin & Schwartz, The Alliance Between Payday Lenders and Tribes: Are Both Tribal Sovereignty and Consumer Protection at Risk? 69 Wash. & Lee L.Rev. 751, 758–759, 777 (2012).

California Supreme Court to review "rent-a-tribe" arrangement for payday lenders

Last week the California Supreme Court granted review in People v. Miami Nation Enterprises, which presents the issue of when a payday lending operation that is formally owned by a Native American tribe but run by a third-party who keeps most of the proceeds is protected by tribal sovereign immunity. The practice of payday lenders evading state regulation by affiliating with tribes has become a significant problem, so hopefully the Court will take this opportunity to cut back on broad assertions of tribal sovereign immunity by exploitative businesses.

DC Circuit Vacates Decision Allowing Serial Mass Copyright Litigant Access to Users' Identifying Information

by Paul Alan Levy

In an opinion issued this morning, the D.C. Circuit unanimously reversed a trial court ruling that compelled several ISP's to provide identifying information for more than a thousand anonymous users who were sued a maker of pornographic movies for allegedly using the BitTorrent protocol to provide access to copies of an adult film.  Although not mentioning the First Amendment right to speak anonymously, the panel endorsed two of the key objections that a coalition of civil liberties groups has been urging for the past decade as a reason to limit subpoenas to identify alleged copyright infringers in mass litigation filed against hundreds or even thousands of users of popular filing-sharing protocols.

Excecutive pay

Check out this report on the relationship between corporate executive pay and worker pay, and then read this article on the topic by David Lazarus, who points out that the salary of the CEO of CVS Caremark last year was 422 times the median wage of a CVS employee.