In 2013, the US Treasury Department announced that Bitcoin exchanges would have to follow the same rules as established financial institutions and implement anti-money laundering programs. As we discussed in a previous blog post, two weeks ago Bitcoin entrepreneur Charlie Shrem was arrested and charged with conspiracy to commit money laundering, based on the use of his Bitcoin exchange business, BitInstant, to sell over US$1 million in Bitcoin to users of the Silk Road, a now-defunct website that allowed its users to buy and sell illegal drugs on the Internet. Representatives from the US Attorney’s office recently discussed how Bitcoin could be more prone to money laundering than current forms of money transfer. With all the concern surrounding Bitcoin and its potential for money laundering, in addition to more recent reports of theft of bitcoins, there is one baseline question that requires closer scrutiny from the legal community—does Congress have the same constitutional power to apply anti-money laundering laws to users of “private” currency like Bitcoin as to users of “public” currency like US dollars? Continue Reading
For a decade, technology companies have been prepared to unleash a wave of innovation related to how people consume cable television. The cable TV industry has generally blocked such efforts, and the FCC to date has largely sidestepped the issue.
The competition authorities at the FCC and the DOJ will shortly begin reviewing the proposed Comcast-Time Warner Cable merger. It seems unlikely, however, that either will take action to promote new technologies for consuming cable TV.
The Cable Television Set-top Box Prevents Innovation
The cable TV set-top box, or “STB,” is the implacable foe to technological innovation. Years ago, Congress passed a law directing the FCC to create rules that would allow consumers to buy whatever STBs they wanted to use from whomever they wanted and plug them into their cable wire. For years, the FCC has sidestepped this obligation. Continue Reading
Recently, Charlie Shrem, a well-known Bitcoin advocate and entrepreneur, was arrested and charged with conspiracy to commit money laundering and operating an unlicensed money transmitting business. Shrem was the vice-president of the Bitcoin Foundation, a non-profit organization dedicated to advocating for the legitimacy of Bitcoin (although he has now stepped down from this position), and the CEO of BitInstant, a Bitcoin currency exchange. According to the criminal complaint, from December 2011 to October 2013, Shrem and his co-defendant Robert Faiella used BitInstant to sell over US$1 million in Bitcoin to users of Silk Road, the now-defunct website that allowed its users to buy and sell illegal drugs on the Internet. Continue Reading
New FCC Chairman Tom Wheeler has spent three decades immersed in the business and policy concerns of two of the most significant communications industries – cable and wireless – under the Commission’s jurisdiction. Thus, there is no doubt that he has the knowledge and experience to lead the agency. However, Chairman Wheeler’s stance on many key issues – including Net neutrality – remains unclear. One of the most important questions at the outset of his tenure is: in the face of increasing market consolidation, how will he cause the FCC to evaluate transactions among industry giants in the industries he used to lead? In Karlee Weinmann’s recent article for Law360, I share some thoughts on how Chairman Wheeler might view these transactions, and how the parties to these deals will need to approach the FCC on his watch if they hope to obtain the required regulatory approvals.
In this series, we conduct a thought experiment on Internet privacy law inspired by a law review article written by Professor Orin S. Kerr, titled “The Next Generation Communications Privacy Act.” The article was Kerr’s thought experiment, discussing how the Electronic Communications Privacy Act, adopted in 1986, could be rewritten from scratch to better reflect the realities of the Internet today. In our series, we laid out the most important facets of today’s Internet: access to information on the Internet is worth to each person one half of that person’s net worth; a vast amount of capital investment is required to store and analyze the big data that makes access to the Internet so valuable; the investment will occur only if a reasonable profit is earned, which is achieved by selling advertising, charging a subscription fee, or some combination thereof; and that Internet users also derive value from their ability to broadcast information on the Internet, not simply to access information.
Assuming we have an adequate picture of today’s Internet, we can proceed with our thought experiment about what Internet privacy law might look like without the Electronic Communications Privacy Act as we know it. Kerr’s article postulated rewriting the Act by applying the stricter wiretap standard to both live communications and stored data. However, he noted that the Act was adopted because Fourth Amendment privacy rights had not been applied to the Internet in case law at the time. We would like to accept Kerr’s premise that privacy law starts with the Fourth Amendment. In this post we explore what an Internet privacy law regime would look like based on the Fourth Amendment. Continue Reading
It can be said that necessity makes for strange bedfellows. In the case of Lamar Advertising Company, this may be the only way to explain how an obscure provision from the Tax Reform Act of 1976 is now having an effect on its bid for REIT status.
A few months ago, we wrote about Iron Mountain’s uncertain path toward REIT status. We discussed the critical question facing a company considering REIT status — whether the bulk of its assets are “real property” as the term is defined in the REIT part of the tax code — as well as the common practice of companies to preemptively seek IRS private letter rulings blessing an asset’s status as real property, and the specific difficulties that Iron Mountain appears to be having obtaining such a ruling declaring its storage racks to be real property.
Like Iron Mountain, Lamar Advertising Company is also seeking REIT status. Lamar is a Louisiana-based outdoor advertising company that owns billboards, digital signs, highway signs, and advertising on buses, bus stops, and benches. Unlike Iron Mountain, most observers assumed that Lamar would be successful in getting a private letter ruling from the IRS declaring its assets to be real property. This optimism was based on the fact that the IRS previously issued two private letter rulings blessing signs as good REIT property; there is also no REIT guidance that states that signs do not qualify as REIT property.
Recent events, however, raise the question of whether a supportive private letter ruling is in the cards for Lamar. Continue Reading
AT&T recently announced a new mobile service offering called “Sponsored Data.” Sponsored Data is a program where a mobile phone user will not be charged for data used if the company that supplies the data pays AT&T for that data. Some questioned whether the sponsored data program would be challenged under the FCC’s so-called “Net Neutrality” (or “Open Internet”) rules.
A few days later, on January 14, the DC Circuit struck down the Net Neutrality rules. These new developments have sparked many questions, some of which I attempt to answer in the following interview.
Bitcoin is the world’s largest digital currency. Introduced in 2009, it is controlled by a software program that was designed by a person or group operating under the pseudonym Satoshi Nakamoto, which had the goal of creating a currency that could run independently from banks and governments. New bitcoins are “mined” via code-breaking computers, and currently there are about 12 million in circulation. Built into the software is a limitation that only 21 million bitcoins can ever exist.
Bitcoin fans are attracted to the finite nature of the currency and its independence from the control of any government, because this means that a central banking authority cannot dilute its value by issuing more. (Of course, the counterpoint to this is the fear that the currency will be subject to deflation in the future, with each unit becoming comparatively more valuable over time.) They are also attracted to the relative ease and minimal expense of Bitcoin transactions—a Bitcoin transaction involves much lower fees than a credit card transaction, and a cross-border transaction can be made easily and without bothering with exchange rates. Bitcoin also offers an unprecedented amount of privacy for its transactions.
Recently, there has been a great deal of speculation about the long-term viability of Bitcoin and what role it and other digital currencies might play in the future. Continue Reading
Today, the United States Court of Appeals for the Federal Circuit announced that the principles of prosecution history estoppel apply to design patents. While this may not come as a surprise to many, since treatises and district court decisions going back to the 1880s have recognized that the concept of prosecution history estoppel applies to design patents as well as utility patents, this issue was one of first impression for the Federal Circuit.
For those that need a quick refresher on prosecution history estoppel, it is a doctrine that limits the bounds of what a patentee can claim as equivalent to his invention by requiring that the claims of the patent be interpreted in light of arguments the patentee made before the United States Patent and Trademark Office. In other words, where subject matter is surrendered during prosecution of the patent in the patent office by the patentee, prosecution history estoppel prevents the patentee from recapturing in an infringement action the very subject matter surrendered as a condition of receiving the patent. The doctrine is founded on the public notice function of patents.
In this case (Pacific Coast Marine v. Malibu Boats LLC), the Federal Circuit held that the same principle of public notice that underlies prosecution history estoppel applies to design patents as well as utility patents. The Court stated that “refusing to apply the principles of prosecution history estoppel to design patents would undermine the definitional and public-notice functions of the statutory claiming requirement” and “the fact that in design patents, unlike utility patents, the claimed scope is defined by drawings rather than language does not argue against application of prosecution history estoppel principles here.” The decision and more details about the case can be found here.
Airbnb has settled a lawsuit filed against it by HomeAway, Law360 reports. Airbnb, like HomeAway, is an Internet purveyor of travel accommodations. HomeAway is the owner of various federal trademark registrations for its birdhouse design mark, and has allegedly used its birdhouse design mark in connection with its business for a number of years. Airbnb’s recently-hatched $2 million “Home to You” ad campaign did not create a birdhouse trademark, but featured prevalent birdhouse imagery, including a mini-movie showing the construction of 50 artist-built birdhouses and artfully drawn birdhouse doodles. HomeAway filed suit against Airbnb on December 23, 2013 in the Western District of Texas, claiming trademark infringement, dilution and unjust enrichment. While the full terms of the settlement are undisclosed, Airbnb has now removed the ad campaign from its website and the mini-movie cannot be viewed on third-party websites that linked to it previously. Apparently, the chickens have come home to roost for Airbnb . . . just not in a birdhouse.