The latest privacy vs. security showdown

The FBI's demand that Apple help it unlock the San Bernardino shooter's iPhone -- and Apple's refusal to do so -- have been big news over the last few days.

The Huffington Post has a helpful guide to the arguments on each side, including everything from what it could mean for the cybersecurity of ordinary consumers to what a "skeleton key" could mean to repressive regimes abroad. Check it out, here.

Article: How Legal Rules Can Improve Search Behavior & Decision Quality

Brigitta Lurger of Graz and four co-authors have written Consumer Decisions Under High Information Load: How Can Legal Rules Improve Search Behavior and Decision Quality?.  Here's the abstract:

EU consumer protection legislation is designed to enable consumers to make "good" contract decisions in the market place. This legislation heavily relies on the model of rational homo oeconomicus: It assumes that consumers want to and can process large amounts of information in order to maximize their own outcomes, and requires businesses to provide a wealth of information to their customers. In an interdisciplinary study conducted by lawyers and psychologists, we wanted to describe the precise flaws of this strategy, based on the EU consumer protection regulation presently in force, and to formulate assumptions about promising regulatory means to overcome them.

We examined search behavior and decision strategies in a sample of 363 persons who we asked to choose a cellular service contract. Participants were presented with contract offers which reflected the demands of the law and which closely matched offers that can be found in the Austrian market. The multiple offers of 11 providers, with variation in rates and conditions, comprised each a large amount of detail and information. Hence, the choice situation was complex and information load was high. Two different user profiles were randomly assigned to the participants. Choice quality was measured on three levels (tariff quality, term quality, and subjective quality). We assessed the information processing behavior (including personal and contextual variables) with a palette of measures, identified discrete choice strategies, and examined how these related to choice quality. We found that most successful search strategies were not exhaustive, but instead involved the focused selection and processing of a medium amount of information. Successful decision behavior of that kind seems to be only partly and most imperfectly supported by present regulation. Research is now underway to explore a more "ergonomic" (i.e., psychologically realistic and effective) regulation of consumer information that may lead to a higher number ob "good" contract choices by cellular service customers.

Citron Article on State AGs and Privacy Law Development

Danielle Keats Citron of Maryland, Yale and Stanford has written Privacy Enforcement Pioneers: The Role of State Attorneys General in the Development of Privacy Law, Forthcoming in the Notre Dame Law Review,   Here's the abstract:

Accounts of privacy law have focused on legislation, federal agencies, and the self-regulation of privacy professionals. Crucial agents of regulatory change, however, have been ignored: the state attorneys general. This article is the first in-depth study of the privacy norm entrepreneurship of state attorneys general. Because so little has been written about this phenomenon, I engaged with primary sources — first interviewing state attorneys general and current and former career staff, and then examining documentary evidence received through FOIA requests submitted to AG offices around the country.

Much as Justice Louis Brandeis imagined states as laboratories of the law, offices of state attorneys general have been laboratories of privacy enforcement. State attorneys general have been nimble privacy enforcement pioneers where federal agencies have been more conservative or constrained by politics. Their local knowledge, specialization, multi-state coordination, and broad legal authority have allowed them to experiment in ways that federal agencies cannot. These characteristics have enabled them to establish baseline fair information protections; expand the frontiers of privacy law to cover sexual intimacy and youth; and pursue enforcement actions that have harmonized privacy policy.

Although certain systemic practices enhance AG privacy policy making, others blunt its impact, including an over reliance on informal agreements that lack law’s influence and a reluctance to issue closing letters identifying data practices that comply with the law. This article offers ways state attorneys general can function more effectively through informal and formal proceedings. It addresses concerns about the potential pile-up of enforcement activity, federal preemption, and the dormant Commerce Clause. It urges state enforcers to act more boldly in the face of certain shadowy data practices.

More Dramatic Times Coverage of Arbitration Clauses: This Time, It's Nursing Homes

Here. A heart-breaking story.

 

FTC Consent Decree Would Allow Dealers to Sell Certified Cars with Safety Defects

by Jeff Sovern

Some auto dealers advertise and sell "certified" used cars. The word "certified" conveys that the car has gone through a process of inspection and that any problems have been remedied. At least, that's how I understand it.  Sometimes, however, these certified cars have been recalled for safety defects which have not been repaired. The FTC has reached a consent decree with a dealer that has allegedly sold such certified cars and has put it out for public comment.  The consent decree obliges the dealer either to repair the defects or disclose that they have not been repaired, even while selling the car as certified.  In other words, the only protection consumers will get against this particular practice will be, if the dealer opts for it, a disclosure. Regular readers of this blog will know that considerable empirical research demonstrates that consumers often ignore disclosures.  A book-length treatment of the issue, with the title indicating the findings, is  Omri Ben-Shahar & Carl E. Schneider, More Than You Wanted to Know: The Failure of Mandated Disclosure 12 (2014) (“not only does the empirical evidence show that mandated disclosure regularly fails, failure is inherent in it”). I suspect many consumers will interpret the word "certified" as meaning any defects have been fixed and will not go beyond that to read carefully a disclosure, no matter how clear and conspicuous, that contradicts their understanding. That would be consistent with the findings in our arbitration study that many consumers ignore disclosures in favor of their pre-conceptions.  Accordingly, the result of the consent decree would be that consumers pay premium prices for unsafe cars that they believe to be safe and do not have repaired, endangering themselves, their families, and others on the road. Readers inclined to comment on the consent decree can do so here; the comment deadline is February 29. (HT: Rosemary Shahan)

 

Tax burden and state likeability

A new Gallup report links the tax burden in U.S. states with the desire of residents of those states to move to other states. 

Check out the following two charts. (In the second chart, "quintile 1" refers to the 10 states with the lowest tax burdens, and "quintile 2" refers to the 10 states with the next lowest tax burdens, and so forth.)

 

 

Watch Public Citizen's David Arkush discuss the relationship between climate change and national security

Here.

 

 

 

 

Liability and driverless cars

We have posted often on self-driving (or autonomous or driverless) cars.  Go, for instance, here, here, and here. We've also posted on liability questions -- that is, who pays for the costs of crashes involving driverless cars? Now, Brian Fung has written this article on the topic.

NHSTA's "Safe Cars Save Lives" campaign

Last year, the National Highway Traffic Safety Administration (NHSTA) oversaw nearly 900 vehicle safety recalls affecting 51 million U.S. cars. Many recalled cars must be fixed to eliminate or mitigate the safety concern.

So, for the recall system work, the consumer must, first, know that the vehicle is the subject of a recall. (The consumer should be sent a recall notice, but that doesn't always work as planned because the consumer cannot be found or for some other reason.) In addition, the vehicle manufacturer must have and distribute to dealers the parts needed to fix the vehicle, and the consumer must take the vehicle in for repair.

To help consumers navigate this system and optimize safety, NHTSA recommends that consumers check its recall database twice a year to see if their cars are subject to a recall and if the fix is ready to be implemented. Go here, to get all the details on NHTSA's Safe Cars Save Lives" campaign.

The role of repeat players in aggregated litigation

Law prof Elizabeth Chamblee Burch and Federal Judicial Center senior researcher Margaret Williams have written Repeat Players in Multidistrict Litigation: The Social Network. Their research found based on limited data "reason to be concerned" that plaintiffs are being shortchanged at the expense of plaintiffs' lawyers and defendants. Here is the abstract:

To promote pretrial efficiency, the Judicial Panel on Multidistrict Litigation has transferred 36 percent of the entire federal courts’ civil caseload to transferee judges for coordinated handling. Transferee judges then pick plaintiffs’ attorneys to lead and manage those cases, and the same attorneys appear in proceeding after proceeding. While past studies have considered repeat play on the plaintiffs’ side, the current study is the first comprehensive empirical investigation of repeat play on both sides. We found robust evidence of repeat play among both plaintiff and defense attorneys and, using social-network analysis, established that a cohesive multidistrict-litigation leadership network exists. That there are repeat players in multidistrict litigation matters considerably. Lead lawyers control the litigation, dominate negotiations, and design settlements. To consider repeat players’ influence, we examined the publicly available nonclass settlements these attorneys negotiated, looking for provisions that one might argue principally benefit the attorneys, and not one-shot plaintiffs. By conditioning the deal on achieving a certain claimant-participation rate and shifting the deal-making entities from plaintiffs and defendants to lead lawyers and defendants, repeat players tied all plaintiffs’ attorneys’ financial interests to defendants’ ability to achieve closure. Over a 22-year span, we were unable to find any publicly available nonclass settlement that didn’t feature at least one closure provision (which benefits the defendant), and likewise found that nearly all settlements contained some provision that increased lead lawyers’ fees. Based on the limited settlements available to us, we found reason to be concerned that when repeat players influence the practices and norms that govern multidistrict proceedings — when they “play for rules,” so to speak — the practices they develop may principally benefit them at the expense of one-shot plaintiffs.