Posts with «company legal & law matters» label

A former Rivian executive sues the automaker for gender discrimination

Electric transport startup Rivian has been sued by one of its former employees. Per The Wall Street Journal, Laura Schwab, an executive who was a vice president of sales and marketing at the automaker until last month, filed a gender discrimination complaint with the California Superior Court in Orange County on Thursday. In the lawsuit, Schwab alleges she was fired by Rivian after she complained of a “toxic ‘bro culture’” that saw other executives exclude her from meetings and ignore her advice.

“The culture at Rivian was actually the worst I’ve experienced in over 20 years in the automotive industry,” Schwab told The Journal. A veteran of the automotive industry, Schwab held executive posts at Aston Martin Lagonda and Jaguar Land Rover before she joined Rivian in November 2020.

According to the outlet, Schwab tried to push the company to address numerous concerns while she was there. In one instance, she allegedly tried to tell the other executives on Rivian’s leadership team that the company had underpriced its vehicles. In yet another situation, she tried to raise concerns about the quality of the automaker’s manufacturing process. In the former case, the company allegedly initially dismissed her advice only to later follow through on it after a male executive raised the same issue.

The suit comes ahead of Rivian’s planned IPO next week where the company will seek to raise as much as $9.6 billion in additional investment. It also recently started producing R1T trucks for customers. More broadly, the suit comes as several other companies in the tech space face scrutiny over their gender equality practices. Most notably, there’s Activision Blizzard, which was sued by California’s fair employment regulator in July for fostering what it described as a sexist “frat boy” workplace culture. The fallout from that lawsuit has been far-reaching. Following months of pressure from employees, the company ended its policy of forced arbitration in cases involving sexual harassment and discrimination and put in place a zero-tolerance stance toward harassment.

Citing the quiet period ahead of its IPO, Rivian declined to comment on the complaint.  

US bans trade with security firm NSO Group over Pegasus spyware

Surveillance software developer NSO Group may have a very tough road ahead. The US Commerce Department has added NSO to its Entity List, effectively banning trade with the firm. The move bars American companies from doing business with NSO unless they receive explicit permission. That's unlikely, too, when the rule doesn't allow license exceptions for exports and the US will default to rejecting reviews.

NSO and fellow Israeli company Candiru (also on the Entity List) face accusations of enabling hostile spying by authoritarian governments. They've allegedly supplied spyware like NSO's Pegasus to "authoritarian governments" that used the tools to track activists, journalists and other critics in a bid to crush political dissent. This is part of the Biden-Harris administration's push to make human rights "the center" of American foreign policy, the Commerce Department said.

The latest round of trade bans also affects Russian company Positive Technologies and Singapore's Computer Security Initiative Consultancy, bot of which were accused of peddling hacking tools.

We've asked NSO Group for comment, although its official media contact address produced an error. The company has strongly rejected claims of enabling abuses in the past, including denials that Pegasus was used to target murdered journalist Jamal Khashoggi. NSO said it had blocked access for previous abuses, and it even hired a libel attorney who accused investigative journalists and their partners of misinterpretation and making unfounded assumptions.

The Commerce Department claims to have evidence of NSO's actions, though. The net effect is the same. NSO isn't necessarily doomed. Like blocklist member Huawei, though, it may struggle to operate without access to any American partners it used before. 

Tesla issues recall of 11,704 EVs over braking software glitch

Tesla has issued its second recall in as many weeks, although this may be more strategic than it is urgent. As the APnoted, The new recall covers 11,704 Tesla EVs from 2017 or newer (including the Model 3, Model Y, Model S and Model X) that were prone to "false-positive braking" after a buggy Full Self-Driving beta update from October 23rd led to a communications breakdown between two chips. The company fixed the issue on October 25th. The day before, it also cancelled the flawed update and disabled emergency braking on cars still using that beta release.

There were no reports of crashes or injuries, Tesla said. The automaker decided to issue a recall on October 26th.

The recall may have been meant to prevent conflicts with the National Highway Traffic Safety Administration. The agency sent a letter to Tesla on October 12th asking why it didn't issue a recall when it fixed an Autopilot software issue that reportedly led to collisions with emergency vehicles. Tesla knows car manufacturers are required to issue recalls for any safety issues, the NHTSA said. It's not clear how Tesla responded to that inquiry before a November 1st deadline, but the company might now be in the habit of issuing recalls for software-related safety problems.

The notice highlights the changing nature of recalls. While recalls for hardware-only flaws haven't changed much (just ask Chevy and LG), software-related issues are another matter. Now that more and more cars accept over-the-air updates, it's possible for companies like Tesla to issue recalls for bugs they've already fixed. Brands may have to make it particularly clear when a recall demands real-world service, as that might not always be clear going forward.

Apple sued in China for selling the iPhone 12 without a charger

It's not just Brazil pressuring Apple to include chargers with iPhones. According to Vice and Shanghai Law Journal, university students in China have sued Apple for not including a charger with an iPhone 12 Pro Max. They claimed the included USB-C to Lightning cable wasn't compatible with other chargers, leaving one student unable to charge the phone as advertised.

The plaintiffs also didn't believe Apple's waste reduction claims. Apple was only using this as an excuse to promote MagSafe wireless chargers that waste more energy than their wired counterparts, the students argued. They want Apple to supply the charger as well as pay legal fees and 100 yuan ($16) for breach of contract.

Apple reportedly told the Beijing virtual court it was common for phone brands to sell power adapters separately, and that the government sanctioned this practice. However, the students pointed out that multiple Chinese companies offer the choice of an adapter in the box. You can buy the Xiaomi Mi 11 with or without a power brick, for example.

The case is still ongoing, and there are no guarantees it will lead to either compensation for the students or a shift in Apple's no-charger policy. Even if the case prompts change, it may only lead to Apple offering the charger as an option at checkout. Nonetheless, the lawsuit illustrates the wider backlash to Apple's position. Don't be surprised if you see more lawsuits like this.

Another former Facebook employee has filed a whistleblower complaint

Another former Facebook employee has filed a whistleblower complaint with the Securities and Exchange Commission. The latest complaint, which was first reported by The Washington Post, alleges Facebook misled its investors about “dangerous and criminal behavior on its platforms, including Instagram, WhatsApp and Messenger.”

In the complaint, the former employee described a conversation with one of Facebook’s top communication executives who, following disclosures about Russia’s use of the platform to meddle in the 2016 election, said the scandal would be a “flash in the pan” and that “we are printing money in the basement, and we are fine.”

Like Frances Haugen, the latest whistleblower is also a former member of Facebook’s integrity team, which was tasked with fighting misinformation, voting interference and other major problems facing the company. And, like Haugen, the former Facebook staffer said that the company has “routinely undermined efforts to fight misinformation, hate speech and other problematic content out of fear of angering then-President Trump and his political allies, or out of concern about potentially dampening the user growth.”

The SEC filing also describes illegal activity in secret Facebook Groups, and Facebook’s policy of allowing politicians and other high-profile users to skirt its rules. It names Mark Zuckerberg and Sheryl Sandberg as being aware of the problems and not reporting them to investors, according to The Post.

While many of the details sound similar to other complaints from former company insiders, news of another complaint adds to the pressure on Facebook, which has spent much of the last month trying to discredit Haugen and downplay the significance of its own research. Meanwhile, lawmakers have called on Zuckerberg to answer questions from Congress, and Haugen is expected to brief European officials as well.

A Facebook spokesperson didn’t immediately respond to a request for comment. Zuckerberg is expected to announce plans to rebrand the company with a new name next week.

Sen. Blumenthal says Zuckerberg needs to testify about Instagram and kids

Senator Richard Blumenthal is again calling on Mark Zuckerberg to testify about Facebook’s research into Instagram and child safety. “It is urgent and necessary for you or Mr. Adam Mosseri to testify to set the record straight and provide members of Congress and parents with a plan on how you are going to protect our kids,” the Connecticut lawmaker wrote in a letter addressed to Zuckerberg.

Blumenthal is the chair of the Senate subcommittee on Consumer Protection, Product Safety, and Data Security that’s been holding hearings on social media and child safety in recent weeks. Earlier this month, Blumenthal said that a series of whistleblower disclosures about Facebook was the company’s “big tobacco moment.”

Since then, pressure has mounted on Facebook to address internal research that shows Instagram can have a negative impact on some teens’ mental health. The company has already “paused” work on a forthcoming Instagram Kids app, but lawmakers have said the company should end the project altogether.

In his letter, Blumenthal said that Facebook’s head of safety, Antigone Davis, who testified at a previous hearing, “appears to have provided false or inaccurate testimony to me regarding attempts to internally conceal its research.” He also said that Facebook “has continued to demean impactful and independent investigative reporting” and “downplayed its own research.”

Facebook didn’t immediately respond to a request for comment.

Activision Blizzard says over 20 employees have 'exited' following harassment cases

Activision Blizzard has confirmed that more than 20 employees have "exited" the company as part of its efforts to change its internal culture following allegations of fostering a "frat boy" workplace. The video game company has published the letter Executive VP for Corporate Affairs Fran Townsend sent to employees revealing the move, in which she also said that more than 20 other individuals faced different types of disciplinary action. Back in July, the California Department of Fair Employment and Housing filed a lawsuit against the developer for allowing a work environment wherein female employees were allegedly subjected to constant sexual harassment.

The agency, which sued the company after a two-year investigation, detailed several of its findings in the lawsuit. It said female employees constantly have to fend off unwanted sexual comments, and that they have to endure being groped by male colleagues. They're also not paid as much as their male counterparts, are typically promoted more slowly and fired more quickly. At the time, Townsend told employees that the lawsuit "presented a distorted" picture of the company and that it included "factually incorrect, old and out of context stories." Hundreds of employees walked out in protest over the company's response. 

Now, in her letter, Townsend said that there's a team dedicated to investigating harassment claims, "working tirelessly to ensure that, moving forward, [the company] is a place where people are not only heard, but empowered." The team received an increasing number of reports in recent months, including concerns from years ago, and it was the members' investigation that led to the exit of more than 20 employees. Townsend declined to name those individuals, but she told Financial Times that they include several game developers and a few supervisors. None of them came from senior management or from the board. 

A Kotaku report from August named three senior designers who abruptly exited the company. Two of them — Diablo 4 lead designer Jesse McCree and World of Warcraft designer Jonathan LeCraft — were previously pictured inside the Cosby Suite. In its lawsuit, DEFH said the Cosby Suite is a room with a photo of Bill Cosby where male employees allegedly harassed women during company events.

To be able to handle more complaints, Activision Blizzard hired three full-time employees to join the investigation team. It's also adding 19 more full-time roles to its overall Ethics & Compliance Team, two of which will be dedicated to overseeing investigations for the EMEA and APAC regions. Townsend admitted that the team can't always share the details of an investigation, but she also promised more transparency "We know there’s a desire to know about the outcome when misconduct is reported. Sometimes, there are privacy reasons we can’t share. But where we can, we will be sharing more information with you. We will also be providing you regular aggregate data about investigative outcomes," she wrote in her letter.

Facebook settles with Justice Department over H-1B hiring practices

Facebook has reached separate settlements with the Department of Justice and Department of Labor over its hiring practices related to foreign workers. The settlements stem from allegations the Trump administration brought against Facebook in late 2020. At the time, the DoJ said the company had “inadequately advertised” at least 2,600 positions between 2018 and 2019 that were eventually filled by workers on H-1B visas.

The company allegedly employed a recruitment process that was intentionally designed to dissuade US workers from applying for positions it had set aside for temporary visa holders. Under the DoJ settlement, Facebook will pay $4.75 million to the federal government and up to $9.5 million to eligible victims.

The fines, while a drop in the ocean for a company like Facebook, represent the largest such penalties the Department of Justice has enforced as part of the Immigration and Nationality Act. More significantly, they're another piece of bad news for a company that has been mired in it in recent weeks. At the start of October, whistleblower Frances Haugen testified before Congress how Facebook’s algorithms have hampered its efforts to slow misinformation on its platforms. The company has also faced increasing scrutiny over its efforts to downplay internal research that shows its platforms can be harmful to some young users.

We’ve reached out to Facebook for comment.

Amazon accused of lying about its business practices to Congress

Members of Congress have accused Amazon executives of misleading or lying to an antitrust committee about its business practices, following recent reports that the company uses third-party seller data to copy products and promotes those versions in search results. The representatives, all members of the House Judiciary Committee’s antitrust subcommittee, are considering whether to ask the Department of Justice to undertake a criminal investigation.

In the letter to chief executive Andy Jassy, Reps. David Cicilline, Ken Buck, Pramila Jayapal, Jerrold Nadler and Matt Gaetz asked Amazon to provide "exculpatory evidence” to back up testimony from executives )(including former CEO Jeff Bezos) to the subcommittee in 2019 and 2020, according to The Wall Street Journal. Bezos told the committee last year that the company doesn't allow employees to use data from individual sellers to bolster its own product lines, though "couldn't guarantee" that the company hasn't misused such data. The company's associate general counsel, Nate Sutton, said in a 2019 testimony that Amazon doesn't “use individual seller data directly to compete” with third-party sellers.

An investigation published by Reuters last week suggested Amazon India "ran a systematic campaign" of copying other companies' products and manipulating search results to promote them. The Markup also reported that Amazon places its own products above competitors' goods in search results, including ones with higher customer ratings. The representatives said the reporting directly contradicts sworn testimony from Bezos, from whom Jassy took over in July, and other executives.

“We strongly encourage you to make use of this opportunity to correct the record and provide the Committee with sworn, truthful, and accurate responses to this request as we consider whether a referral of this matter to the Department of Justice for criminal investigation is appropriate,” the lawmakers wrote in the letter. "At best, this reporting confirms that Amazon's representatives misled the Committee. At worst, it demonstrates that they may have lied to Congress in possible violation of federal criminal law."

The House Judiciary Committee has been looking into this issue since 2019 as part of a broader investigation of competition in digital markets. The representatives gave Jassy until November 1st to respond to the letter. "We’re giving Amazon one last chance to come clean about how they abuse other seller’s data and unfairly advantage their own products," subcommittee chair Cicilline wrote on Twitter. "We cannot continue to allow Big Tech to destroy small businesses." 

"Like other retailers, we look at sales and store data to provide our customers with the best possible experience," Amazon told The Wall Street Journal. "However, we strictly prohibit our employees from using non-public, seller-specific data to determine which private label products to launch. While we don’t believe these claims are accurate, we take these allegations very seriously and have launched an internal investigation."

An Amazon spokesperson provided the following statement to Engadget:

Amazon and its executives did not mislead the committee, and we have denied and sought to correct the record on the inaccurate media articles in question. As we have previously stated, we have an internal policy, which goes beyond that of any other retailer’s policy that we’re aware of, that prohibits the use of individual seller data to develop Amazon private label products. We investigate any allegations that this policy may have been violated and take appropriate action. In addition, we design our search experience to feature the items customers will want to purchase, regardless of whether they are offered by Amazon or one of our selling partners.

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.