Consumer Law & Policy Blog

Trump Administration Backs Off on Identifying Anonymous Web Site Viewers, But Important Free Speech Issues for Some Web Viewers Remain

by Paul Alan Levy

Responding to an outpouring of popular outrage as well as legal filings (including one from Public Citizen as well as an amicus brief from Avaaz) showing that the First Amendment protects the right to read anonymously and can be used to limit the enforcement of criminal discovery demands seeking to identify innocent readers of protected speech, the Trump Administration’s Justice Department has backed down from some of the worst extremes of the search warrant that it served on DreamHost. (A cynic might wonder whether the impetus for the change might have been the fact that the ruling on its warrant was switched from a DC Superior Court judge who was a career prosecutor to the court’s chief judge, whose background was in criminal defense.) In any event, the Government’s reply brief asks Chief Judge Morin to revise the warrant to exclude the server log files that would reveal the IP addresses of all visitors to the web site.

The reply brief is more than a little disingenuous about the reasons for the changes. The government claims that it fully respects the First Amendment rights of peaceful protestors, that its singular focus is and has always been on prosecuting a small band who planned and executed a riot, not the many others who did no more than protest peacefully, and that prosecutors simply had no idea that the documents demanded would include log files that would reveal the IP addresses of web site viewers. But the original search warrant demanded production of the very same thing: “HTTP request and error files” (see the line at the top of the last page of the warrant linked above) that are now excluded from the subpoena (see the line at the top of the third-page from the end of this document, captioned as subparagraph (f).  And besides, what federal prosecutor genuinely does not know that web servers typically retain log files?

Seventh Circuit holds that unaccepted pre-litigation offer does not deprive plaintiff of standing in later-filed suit

The unanimous decision, by Chief Judge Wood, is Laurens v. Volvo Cars of N. America. Here's the beginning of the opinion, which sums things up quite nicely:

The idea of a theme and variations is a common one in music. It should be in law, too. Here we return to the familiar theme of a defense effort to pretermit a proposed class action by picking off the named plaintiff’s claim. Several variations on that theme have been tried and have failed. See Campbell‐Ewald Co. v. Gomez, 136 S. Ct. 663 (2016). (Rule 68 offers of judgment); Fulton Dental, LLC v. Bisco, Inc.,860 F.3d 541 (7th Cir. 2017) (Rule 67 payments to court registry). Undeterred, the defendant in the case now before us asserts that an unaccepted offer of relief before a putative plaintiff files a lawsuit deprives that plaintiff of standing. We see no reason why the timing of the offer has such a powerful effect. Black‐letter contract law states that offers do not bind recipients until they are accepted. See, e.g., ALI Restatement (Second) of Contracts § 17 (1981). Hence while the legal effect of every variation on the strategic‐mooting theme has not yet been explored, we are satisfied that an unaccepted pre‐litigation offer does not deprive a plaintiff of her day in court.

 

It's worth reading the whole thing.

"Under Trump Rule, Nursing Home Residents May Not Be Able To Sue After Abuse"

NPR reports on the Trump Administration proposed rule to allow nursing homes to require new residents to agree to arbitration as a condition of admission.

A rule issue under the Obama Administration barred nursing homes forced arbitration agreements for nursing homes, leaving it to the two sides to decide whether they preferred court or arbitration after a dispute arose. The Trump administration rule, NPR reports, "could make it almost impossible for nursing home residents to get their day in court."

The NPR story is here. The proposed regulation is here.

CFPB director Cordray's op-ed in the NY Times

Consumer Financial Protection Bureau Director Richard Cordray has an op-ed in the New York Times today, explaining the importance of the CFPB rule barring class-action bans in forced arbitration provisions.His conclusion: "A cherished tenet of our justice system is that nobody should escape accountability for breaking the law. Our rule restores consumers’ legal right to stand up for themselves and have their day in court without having to wait on the government to act."

The piece is here.

Do congressional partisan-balance requirements for multimember agencies matter?

That's the topic of Partisan Balance With Bite by law profs Brian Feinstein and Daniel Hemel. It struck me as timely. Here is the abstract:

Dozens of multimember agencies across the federal government are subject to partisan balance requirements, which mandate that no more than a simple majority of agency members may hail from a single party. Administrative law scholars and political scientists have questioned whether these provisions meaningfully affect the ideological composition of federal agencies. In theory, Presidents can comply with these requirements by appointing ideologically sympathetic members of the opposite party once they have filled their quota of same-party appointees (i.e., a Democratic President can appoint liberal Republicans or a Republican President can appoint conservative Democrats). No multi-agency study in the past 50 years, however, has examined whether — in practice — partisan balance requirements actually prevent Presidents from selecting likeminded individuals for cross-party appointments.

This article fills that gap. We gather data on 578 appointees to 23 agencies over the course of six presidencies and 36 years. We identify the estimated ideological preferences of those appointees based on personal campaign contributions. We then compare the ideological preferences of co-party and cross-party appointees across agencies and across presidencies. Our analysis indicates that partisan balance requirements had at most a modest impact on the ideological composition of multimember agencies from the late 1970s to the early 1990s, but a stronger effect from the mid-1990s onward. We then consider several possible explanations for these findings. Our results are consistent with a story of “partisan sort”: as ideology and party affiliation have become more tightly linked, cross-party appointees have become more likely to share the ideological preferences of their co-partisans rather than those of the appointing President. Our findings suggest that the increasing polarization of political parties is contributing to a concomitant increase in the ideological heterogeneity of multimember agencies subject to partisan balance mandates.

$417 million baby-powder jury verdict in ovarian cancer case

Does the talc in baby powder cause ovarian cancer? A California jury thinks so. And, by a vote of 9 to 3, that jury today told Johnson & Johnson to pay $417 million to a woman with ovarian cancer. Read about it here, here, here, and here. One report notes that Johnson & Johnson, "which faces 5,500 claims in U.S. courts, has lost four previous jury verdicts in St. Louis for a total of $300 million."

Here is what the American Cancer Society says on the topic:

It has been suggested that talcum powder might cause cancer in the ovaries if the powder particles (applied to the genital area or on sanitary napkins, diaphragms, or condoms) were to travel through the vagina, uterus, and fallopian tubes to the ovary. Many studies in women have looked at the possible link between talcum powder and cancer of the ovary. Findings have been mixed, with some studies reporting a slightly increased risk and some reporting no increase. Many case-control studies have found a small increase in risk. But these types of studies can be biased because they often rely on a person’s memory of talc use many years earlier. Two prospective cohort studies, which would not have the same type of potential bias, have not found an increased risk. For any individual woman, if there is an increased risk, the overall increase is likely to very be small. Still, talc is widely used in many products, so it is important to determine if the increased risk is real. Research in this area continues.

 

Blocking Prosecutors From Creating Trump’s Enemies List

by Paul Alan Levy

This morning we filed a motion for leave to intervene in the proceeding, now assigned to Chief Judge Robert Morin of the Superior Court for the District of Columbia, in which DreamHost has been opposing the implementation of a warrant for all files connected with the DisruptJ20 web site that carried information about a range of protests planned for Washington, DC and around the country against the inauguration of Donald Trump. The warrant was issued by the Superior Court trial judge who is charged with trying the cases of two hundred individuals who were arrested and charged with vandalism and assault carried out by the so-called “black bloc” during the inauguration protests.

“All files” would include the server logs that would reveal the IP addresses of each and every visit to the protest site; indeed, the search warrant  expressly demands the production of “log files” those IP addresses are the first step in the chain of discovery that would lead to the identification of the members of the public who visited the web site. For Internet users who have static IP addresses, the IP address alone could be identifying. It strikes me as quite possible that the trial judge who signed this warrant was unaware of its broad reach.

Wells Fargo, forced arbitration, and the principled conservative effort to preserve the CFPB's arbitration rule

Jeff's coverage of conservatives who support the CFPB's arbitration rule (for instance, here and here) includes his re-post of Dean Clancy's recent U.S. News piece. You might also be interested in Clancy's earlier article that looked at the Wells Fargo scandal through the lens of pre-dispute, mandatory arbitration clauses. 

May contributions to Super PACS be regulated despite Citizens United?

Read Why Limits on Contributions to Super PACS Should Survive Citizens United by Albert Alschuler, Laurence Tribe, Norman Eisen, and Richard Painter. Here is the abstract:

Soon after the Supreme Court decided Citizens United v. FEC, the D.C. Circuit held all limits on contributions to super PACs unconstitutional. Its decision in SpeechNow.org v. FEC created a regime in which contributions to candidates are limited but in which contributions to “independent expenditure committees” urging votes for these candidates are unbounded. 

No legislator ever voted in favor of this system of campaign financing, and the thought that the Constitution requires it is odd. Forty-one years ago, Buckley v. Valeo held that Congress could prohibit a $1001 contribution to a candidate because this contribution was corrupting or created an appearance of corruption. According to the D.C. Circuit, however, Congress may not prohibit a $20 million contribution to a super PAC because this contribution does not create even an appearance of corruption. 

 

Still Another Conservative Supports the CFPB Arbitration Rule

Colin Hanna, President of Let Freedom Ring USA, has penned Forced arbitration: Big banks' 'Star Chamber' in the Washington Examiner. Excerpt:

Elbridge Gerry was a colonial-era plutocrat who became a patriot, a signer of the Declaration of Independence and a champion of equal justice under the law. * * *

One of his more famous sayings was that "a tribunal without juries would be a Star Chamber in civil cases" -- "Star Chamber" being a reference to the supervisory English court known best for protecting friends of the king and persecuting his enemies.

* * *

[L]eaders like Gerry saw that without the right protections in place, civil proceedings could be used as means to oppress the powerless.

This is exactly what has happened with the ubiquity of forced arbitration.  * * *

* * *

[A]rbitration hearings, in tilting the scales of justice heavily to Big Business and rendering consumers virtually defenseless, seem indeed to be the 21st-century version of the Star Chambers. Like the clauses themselves, the hearings remain largely hidden from view, with no jury of one's peers, no real chance for appeal, and no mandate even to adhere to the law, federal or state.

* * *

The practice of forced arbitration is so offensive to any sense of justice – as envisioned by Elbridge Gerry and the other Founders – that conservatives must demand the CFPB rule be preserved until Congress itself has opportunity to revisit the issue and rid America of the Big Banks' Star Chambers.