Posts with «company legal & law matters» label

Dbrand stops selling PS5 faceplates after Sony issues legal threats

It's not just small companies facing Sony's wrath over aftermarket PlayStation 5 faceplates. Dbrand told The Verge it stopped selling its PS5 "Darkplates" after Sony issued a cease-and-desist letter earlier in the year threatening legal action over alleged design and trademark violations. Visit Dbrand's product page now and you'll only see links to news stories and testimonials.

Dbrand isn't going down quietly. In a Reddit thread, the company claimed it was submitting to the "terrorists' demands... for now." It believed customers had the right to modify hardware with third-party components, and speculated that Sony might be clamping down so that it can either sell its own covers or charge licensing fees. The company didn't definitively say it planned to resume sales, but did say it would "talk soon."

Whatever Dbrand's intentions, this takes away a major option (though not your only option) for customizing the PS5. The question is whether or not Sony can completely halt third-party faceplate sales. After all, the faceplates are designed to be easily removable and aren't much more than plastic sheets. Dbrand likened this to replacing a broken F-150 truck bumper with an aftermarket part — you have the right to choose the parts you use for fixes or cosmetic upgrades, and Ford can't sue simply because you're using an unofficial bumper. It won't be surprising if there's an eventual court battle over Sony's policy.

Google countersues Epic Games for sidestepping fees on in-app purchases

Google has countersued Epic Games over in-app purchases on Fortnite, saying it "willfully breached" its Play Store developer agreement, ZDNet has reported. Epic originally sued Google in August, shortly after it filed a complaint against, and was countersued by, Apple. "Epic has alternatively been unjustly enriched at Google's expense," the company said in its complaint. 

As a reminder, Epic sued Google for removing Fortnite from its Play Store after a "Mega Drop" update gave players a way to bypass Play and get discounted items. Google later forced OnePlus to break off a deal that would have seen the Fortnite launcher pre-installed on its OnePlus 8 smartphone, bypassing the Play Store and eliminating Google's commission on in-app purchases. 

Google stated that unlike with Apple's App Store, Android developers aren't forced to use Google Play. "They choose to use it when given a choice among Android app stores and distribution channels," according to the complaint. "Google supports that choice through Android itself, Google Play's policies and Google's agreements with developers and device manufacturers."

Unlike competitors like Apple, Google does not require Android users or developers to use Google Play in order to download, install, or distribute apps on Android.

That argument is complicated by documents unsealed in Epic's original lawsuit against Google, however. They showed that Google paid other game developers and phone makers like LG and Motorola to exclusively use the Play Store rather than offering other store options. That's one reason cited by the 38 US states and territories that filed an antitrust suit against Google, in the same California federal court where Epic filed its own claim. 

In 2018, Google reportedly offered Epic up to $208 million to bring Fortnite to the Play Store — effectively cutting its usual 30 percent take by around five percent. According to the same court documents, Google was so concerned by a potential loss of Play Store revenue that it even considered acquiring Epic.

Epic received a mixed ruling in its lawsuit battle with Apple. On the one hand, judge Yvonne Gonzalez Rogers ordered Apple to eliminate App Store rules that prevent developers from adding in-app links to payment sites. On the other, she ruled that Apple was not anticompetitive based on California law and ordered Epic to pay Apple $3.6 million. Both parties have appealed that ruling, and Apple has said it won't letFortnite back on the store until all appeals are resolved. 

US Justice Department forms a cryptocurrency enforcement team

The United States Department of Justice has formed a team of investigators to look into the use of cryptocurrency for criminal purposes. To be specific, the group, called National Cryptocurrency Enforcement Team (NCET), will tackle cases committed by virtual currency exchanges and groups and individuals involved in money laundering. Members will also investigate mixing and tumbling services, which charge customers a fee to send cryptocurrency to an address while also concealing the source of the funds. In addition, they'll work on tracing and recovering assets lost to fraud or ransomware extortion demands. 

According to the DOJ's announcement, the team will combine the expertise of its money laundering and asset recovery section with its computer crime and intellectual property section. It will also include experts from US Attorneys' Offices. The group will be under the supervision of Assistant Attorney General Kenneth A. Polite Jr., though the Justice Department is still looking for an individual to lead it. DOJ is looking for someone "with experience with complex criminal investigations and prosecutions, as well as the technology underpinning cryptocurrencies and the blockchain," in particular. 

The hope is that NCET can provide the whole department and other government agencies with the expertise in cryptocurrency and blockchain needed to investigate and prosecute the growing number of cases related to the technology today. There's been a rise in cybercrime cases these past years, including ransomware attacks wherein bad actors target companies across industries to hold their networks hostage in exchange for payment via cryptocurrency. 

Some of them have had real-world consequences. The attack on Colonial Pipeline caused fuel shortage in the East Coast, for instance, while the various attacks on hospitals around the world put people's lives in danger. The Biden administration is even hosting a meeting with 30 countries later this month to discuss the threat of ransomware attacks to global economy and national security.

Deputy Attorney General Lisa O. Monaco said in a statement:

"Today we are launching the National Cryptocurrency Enforcement Team to draw on the Department’s cyber and money laundering expertise to strengthen our capacity to dismantle the financial entities that enable criminal actors to flourish — and quite frankly to profit — from abusing cryptocurrency platforms. As the technology advances, so too must the Department evolve with it so that we’re poised to root out abuse on these platforms and ensure user confidence in these systems."

Tesla must pay $137 million in discrimination lawsuit

Tesla has been ordered to pay $137 million in damages to a former Black worker who accused the company of turning a blind eye to discrimination and racial abuse at the company's EV plant in Fremont California, the Washington Post has reported. A San Francisco federal court jury awarded the judgement — reportedly one of the largest in an individual race discrimination employment case — to Owen Diaz, an elevator operator who worked as a contract employee in 2015 and 2016.

In the lawsuit, Diaz alleged that he faced discrimination "straight from the Jim Crow era," in which he was subjected to racial slurs. He alleged that Tesla employees left drawings of swastikas, racist graffiti and offensive cartoons around the plant, while supervisors neglected to halt the abuse. "Tesla's progressive image was a façade papering over its regressive, demeaning treatment of African-American employees," according to the lawsuit. 

The jury awarded Diaz $6.9 million for emotional distress, but the majority, $130 million, was punitive damages against Tesla. "It's a great thing when one of the richest corporations in America has to have a reckoning of the abhorrent conditions at its factory for Black people," said the lawyer for Diaz, Lawrence Organ. 

"It took four long years to get to this point,” Diaz told the New York Times. “It’s like a big weight has been pulled off my shoulders.”

In response to the verdict, Tesla downplayed the allegations in a blog post written by human resources VP Valerie Capers Workman. "In addition to Mr. Diaz, three other witnesses (all non-Tesla contract employees) testified at trial that they regularly heard racial slurs (including the N-word) on the Fremont factory floor,” she wrote. “While they all agreed that the use of the N-word was not appropriate in the workplace, they also agreed that most of the time they thought the language was used in a ‘friendly’ manner and usually by African-American colleagues.”

Tesla added that it was responsive to Mr. Diaz's complaints, firing two contractors and suspending another. She said that while the facts didn't justify the verdict, the company was "not perfect" in 2015 and 2016, "but we have come a long way." The company has yet to say whether it plans to appeal.

Facebook asks judge to dismiss FTC antitrust charges... again

Facebook is once again asking a federal judge to dismiss the Federal Trade Commission’s antitrust suit against the social network. In a new filing, the company argued that the government “still has no factual basis for alleging monopoly power.”

The FTC originally filed antitrust charges against the company last December. A judge dismissed that complaint in June, saying the government’s case was “legally insufficient,” but gave the FTC a chance to refile. The FTC filed a new complaint in August. The amended complaint relied on the same arguments but was more detailed than the initial suit. In it, the government argued that Facebook used its acquisitions of WhatsApp and Instagram to quash rivals it viewed as an “existential threat.”

“The complaint alleges that after repeated failed attempts to develop innovative mobile features for its network, Facebook instead resorted to an illegal buy-or-bury scheme to maintain its dominance,” the FTC wrote in a statement at the time. “Lacking serious competition, Facebook has been able to hone a surveillance-based advertising model and impose ever-increasing burdens on its users.”

The judge has until November 17th to respond. Even if Facebook is successful in getting the new FTC suit dismissed, the company is still facing numerous other investigations into its policies and practices. European regulators have also opened an antitrust probe into the social network, and the UK’s competition watchdog is also reportedly investigating the company.Meanwhile, in the US, Facebook is still reeling from the fallout of a whistleblower who has provided thousands of documents to Congress and the Securities and Exchange Commission, which she says prove the company “chooses profit over safety.” The whistleblower, former product manager Frances Haugen, is scheduled to testify at a Senate Commerce Committee hearing Tuesday morning.

Donald Trump sues to get his Twitter account back

If you were hoping the long running Donald Trump / Twitter saga was over, I have bad news. The former president has filed suit in Florida seeking a preliminary injunction of the ban, while he works towards having his account permanently reinstated. Trump is arguing, as expected, that the ban violates his First Amendment rights, but also Florida's new social media law signed by Governor Ron DeSantis earlier this year — though courts have stopped the law from taking effect on the grounds that it likely violates free speech laws. 

The suit makes many predictable arguments that Twitter is “a major avenue of public discourse" and that it "exercises a degree of power and control over political discourse in this country that is immeasurable, historically unprecedented, and profoundly dangerous to open democratic debate.” 

This story is developing...

Disney settles Scarlett Johansson lawsuit over 'Black Widow' streaming strategy

Disney and Scarlett Johansson are no longer on the outs. The parties have reached a settlement for the lawsuit Johansson filed over the hybrid release strategy used for Black Widow. If you'll recall, the actor sued Disney over the company's decision to release her movie in theaters and on Disney+ at the same time, accusing the entertainment giant of breach of contract. 

Johansson's camp argued that Black Widow was supposed to be released in theaters exclusively under her deal with Marvel. According to the lawsuit she filed, she could lose as much as $50 million due to the hybrid release, seeing as her compensation is tied directly with the movie's box office success and doesn't include a cut from what Disney would make from streaming. People have had to pay $30 for a Premier Access pass to watch the movie on Disney+, and the company said Black Widow earned $60 million from streaming during its opening weekend. 

Her lawsuit also said that her camp tried to contact Disney and Marvel to re-negotiate their deal, but they were allegedly unresponsive. Neither party disclosed the terms of their agreement, but both issued a statement mentioning future collaborations. Alan Bergman, chairman of Walt Disney Studios, said he looks "forward to working together on a number of upcoming projects, including Disney's Tower of Terror."

Meanwhile, entertainment workers are gearing up for a strike because studios like Disney are rapidly producing content after pandemic-related restrictions had lifted. The situation led to poor working conditions with long hours and no breaks for production crew. Entertainment unions are hoping to convince studios to make changes, including ending the lower pay scale for smaller streaming services. Under the current rules, streaming services with fewer than 20 million subscribers like Apple TV+ does can pay their workers lower wages.

China's central bank says cryptocurrency transactions are illegal

China is continuing to push forward in its cryptocurrency crackdown. The People’s Bank of China says crypto transactions are illegal and called for a formal ban. It cited concerns about national security and the safety of residents' assets.

The bank claims cryptocurrencies aren’t fiat currency and can’t be circulated, as Bloomberg reports. Any transactions involving crypto are now deemed to be criminal financial activity. The bank told financial and internet companies to stop allowing crypto trades on their platforms. Foreign exchanges are banned from providing services to Chinese residents too. 

The rise of crypto has invoked an increase in “money laundering, illegal fund-raising, fraud, pyramid schemes and other illegal and criminal activities,” the bank said. It said those appearing to violate the rules will be “investigated for criminal liability.”

Several agencies in the country are working together to clamp down on crypto use. The National Development and Reform Commission is looking to put a halt to crypto mining, as TechCrunch notes. The Sichuan local government banned crypto mining in June, prompting some miners to leave the country.

The price of Bitcoin dropped from around $45,000 to approximately $41,500 following the central bank's announcement.

UK appeals court rules AI cannot be listed as a patent inventor

Add the United Kingdom to the list of countries that says an artificial intelligence can’t be legally credited as an inventor. Per the BBC, the UK Court of Appeal recently ruled against Dr Stephen Thaler in a case involving the country’s Intellectual Property Office. In 2018, Thaler filed two patent applications in which he didn’t list himself as the creator of the inventions mentioned in the documents. Instead, he put down his AI DABUS and said the patent should go to him “by ownership of the creativity machine.”

The Intellectual Property Office told Thaler he had to list a real person on the application. When he didn’t do that, the agency decided he had withdrawn from the process. Thaler took the case to the UK’s High Court. The body ruled against him, leading to the eventual appeal. "Only a person can have rights. A machine cannot," Lady Justice Elisabeth Laing of the Appeal Court wrote in her judgment. "A patent is a statutory right and it can only be granted to a person."

Thaler has filed similar legal challenges in other countries, and the results so far have been mixed. In August, a judge in Australia ruled inventions created by an AI can qualify for a patent. However, only earlier this month, US District Judge Leonie M Brinkema upheld a decision by the US Patent and Trademark Office that said “only natural persons may be named as an inventor in a patent application." Judge Brinkema said there may eventually be a time when AI becomes sophisticated enough to satisfy the accepted definitions of inventorship, but noted, “that time has not yet arrived, and, if it does, it will be up to Congress to decide how, if at all, it wants to expand the scope of patent law.”

Shareholders claim Facebook overpaid an FTC settlement to protect Zuckerberg

Facebook shareholders have filed a lawsuit alleging that board members overpaid on a $5 billion FTC fine to protect CEO Mark Zuckerberg from an individual lawsuit, Politico has reported. "Zuckerberg, Sandberg, and other Facebook directors agreed to authorize a multi-billion settlement with the FTC as an express quid pro quo to protect Zuckerberg from being named in the FTC’s complaint, made subject to personal liability, or even required to sit for a deposition," according to one of the two suits filed.

The two lawsuits, filed in a Delaware court last month, cite internal discussion among Facebook's board members. In February of 2019, the FTC named both Facebook and Zuckerberg personally as defendants in a draft complaint sent to company lawyers, according to the shareholders (the FTC has never revealed any such plans). Two Democrats voted against the settlement, saying that Zuckerberg should have been held personally responsible. 

"The FTC has never disclosed that it originally planned to name Zuckerberg personally in the lawsuit, and the agency's two Democrats at the time voted against the settlement in part because of the lack of personal liability for the CEO," one group of shareholders alleged. 

The $5 billion settlement was the result of an FTC complaint filed over Facebook's Cambridge Analytica scandal. Democratic commissioners said the settlement wouldn't have the desired outcome, which was to force Facebook to improve privacy and other issues. Since then, privacy has continued to be an issue across Facebook and its other platforms, along with areas like misinformation, harassment and double standards for elite users, according to a recent WSJ series

“The Board has never provided a serious check on Zuckerberg’s unfettered authority,” one set of shareholders said. “Instead, it has enabled him, defended him, and paid billions of dollars from Facebook’s corporate coffers to make his problems go away." Engadget has reached out to Facebook for comment.