Federal Government

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The Senate is one step closer to a floor vote on cybersecurity legislation that would address information sharing between the private sector and the government. On July 8, the Senate Select Committee on Intelligence approved a contentious cybersecurity bill known as the Cyber Information Sharing Act (CISA).

The proposed legislation would remove legal barriers to allow private companies to share information regarding cyber-attacks “in real time” with other private companies and the government. Companies sharing information for cybersecurity purposes would be shielded from lawsuits by individuals against the company for sharing that data, regardless of terms of service contracts that may prevent such actions without a customer’s consent. In order to receive the liability protection, private entities would be required to submit information directly to the Department of Homeland Security, which could then share the information with other federal agencies as necessary to address the threat. Additionally, CISA would direct the federal government to share classified and unclassified information with the private sector.

CISA also includes several provisions to protect privacy, such as requiring that companies sharing information remove all personally identifiable data (e.g. names, addresses, and Social Security numbers). The Attorney General would be directed to write procedures to limit government use of cyber information received to “appropriate cyber purposes” and ensure that privacy protections are in place. A full synopsis from the Senate Committee Chair and co-sponsor of CISA, Dianne Feinstein (D-CA), is available here.

Adequate privacy protections have been a continuing sticking point for successful cybersecurity information sharing legislation. The Cyber Intelligence Sharing and Protection Act (CISPA) – the information sharing bill counterpart in the House of Representatives – faced strong privacy objections from civil liberties and public interest groups. When CISPA passed the House in 2013, the White House threated to veto the bill unless it included additional privacy protections.

Even with CISA’s added protections, many privacy groups oppose the bill. Similar to CISPA, these groups remain anxious that the legislation could encourage a company, such as Google, to turn over huge amounts of emails or other private data to the government in the name of cybersecurity. The groups fear that the National Security Agency and other government agencies could gain access to even more personal information through this legislation. Moreover, because CISA provides liability protections to companies sharing information, individuals would have little recourse in the event of abuse.

Whether CISA becomes law in 2014 will depend not only on how quickly it can pass a floor vote but also how easily the Senate bill can be reconciled with CISPA, the House counterpart passed last year. Though CISA passed the Senate committee with bi-partisan support, Senate Democrats are already wavering on support due to concerns of insufficient privacy protections. If CISA manages to pass the Senate, there is a chance the House and Senate can agree to a reconciled bill. Representative Mike Rogers (R., Mich.), chairman of the House Intelligence Committee and co-sponsor of CISPA, stated publicly that the committees were close to agreement on harmonizing their respective cyber threat information-sharing bills, and had narrowed down their difference to a few, discrete issues. However, with less than 15 legislative days before the August recess and all eyes focused on the upcoming mid-term elections in November, if this cybersecurity legislation has any hope of moving forward Congress will need to do something it rarely does: act quickly.

There are (many) legitimate criticisms of President Obama to be made, from both the right and the left. But reasonable people can agree that there are also many ridiculous ones.

He’s a Communist! He’s not a U.S. citizen! He’s a closet Muslim who wants to institute sharia law in the United States!

How about: he’s a plagiarist!

It’s true of Vice President Joe Biden. Is it true of President Obama?

(Please note the UPDATE added below.)

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Judge Emmet Sullivan

* Judge Emmet Sullivan (D.D.C.) wants the IRS to explain, in a sworn declaration, how exactly it lost Lois Lerner’s emails. [WSJ Law Blog]

* And the fun for the IRS continues today in the courtroom of Judge Reggie Walton (D.D.C.), as reported by Sidney Powell, author of Licensed To Lie (affiliate link). [New York Observer]

* Speaker John Boehner wants to take the Republicans’ crusade against Obamacare to the courts. [New York Times]

* Andrew Calder, the young M&A partner that Kirkland & Ellis snagged from Simpson Thacher for a reported $5 million a year, is already bringing in big deals. [American Lawyer]

How the cupcake crumbles: the once-successful venture of an NYLS grad and her husband needs a rescue.

* “Duke University is not and never has been in the business of producing, marketing, distributing, or selling alcohol.” Some bros down in Durham disagree. [ABA Journal]

* If you see something… sue someone? The ACLU and Asian American civil rights groups, together with some help from Bingham McCutchen, have filed a legal challenge to the Suspicious Activity Reporting database. [New York Times]

* Congrats to David Hashmall, the incoming chair of Goodwin Procter — and congrats to outgoing chair Regina Pisa, the first woman ever to lead an Am Law 100 firm, on her long and successful leadership. [American Lawyer]

* A group of investors might end up devouring Crumbs, the cupcake-store chain founded by New York Law School grad Mia Bauer that suddenly shut down this week amid talk of a bankruptcy filing. [Wall Street Journal (sub. req.)]

This year to date has not brought much happy news for Dickstein Shapiro. In April, we covered associate and staff reductions at the firm. In May, the Am Law 200 rankings revealed a 20 percent drop in revenue at Dickstein. In June, the firm fell out of the Vault 100.

In 2013, Dickstein Shapiro experienced the most partner departures of any Am Law 200 firm. And this week brings word of additional partner defections.

Who are the lawyers in question, where are they going, and how big a deal is their departure?

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Ed note: This piece is from the official blog for the telecom practice of Kelley Drye & Warren LLP.

In the wake of a number of high-profile cybersecurity events — from the Heartbleed bug to the Target breach — cybersecurity has become a red-hot issue in Washington, D.C. Earlier this month, in a major address delivered at the American Enterprise Institute, Federal Communications Commission Chairman Tom Wheeler announced a new cybersecurity initiative to create a “new paradigm for cyber readiness” in the communications sector.

As described by Wheeler, the FCC’s cybersecurity initiative will be led by the private sector, with the Commission serving as a monitor and backstop in the event that the market-led approach fails. In particular, the FCC will “identify public goals, work with the affected stakeholders in the communications industry to achieve those goals, and let that experience inform whether there is any need for next steps.” Chairman Wheeler stressed that the new paradigm must be dynamic, more than simply new rules, and the Commission will rely on innovation by the private sector.

The Commission’s efforts will be guided by four principles, including commitments to:

1. preserving the qualities that have made the Internet an unprecedented platform for innovation and free expression, so that Internet freedom and openness is not sacrificed in the name of enhanced security;
2. privacy, i.e., enabling personal control of one’s own data and networks;
3. cross-sector coordination, e.g., among regulatory agencies; and
4. the multi-stakeholder approach to global Internet governance and an opposition to any efforts by international groups to impose Internet regulations that could restrict the free flow of information in the name of security.

Expect FCC staff actions to be organized around the following elements:

(1) Information Sharing and Situational Awareness. The Commission is looking into legal and practical barriers to effective sharing of information about cyber threats and vulnerabilities in the communications space. Specifically, the Chairman noted that “companies large and small within the Communications communications sector must implement privacy-protective mechanisms to report cyber threats to each other, and, where necessary, to government authorities.” Moreover, where a cyberattack causes degradations of service or outages, the Chairman stated that “the FCC and communications providers must develop efficient methods to communicate and address th[e] risks.” To that end, the Chairman noted that the FCC is actively engaged with private sector Information Sharing and Analysis Organizations, and with other federal agencies, to improve threat information sharing and situational awareness.

(2) Cybersecurity Risk Management and Best Practices. Noting the work of the Communications Security, Reliability and Interoperability Council (CSRIC) in developing voluntary cybersecurity standards, Chairman Wheeler called upon communications providers to work with the Commission to set the course for years to come regarding how companies in that sector communicate and manage risk internally, with their customers and business partners, and with the government. In addition, the Commission will be seeking information to measure the implementation and impact of the CSRIC standards.

(3) Investment in Innovation and Professional Development. Chairman Wheeler has asked the FCC Technological Advisory Council (“TAC”) to explore specific opportunities where “R&D activity beyond a single company might result in positive cybersecurity benefit for the entire industry.” Specifically, the FCC will “identify incentives, impediments, and opportunities for security innovations in the market for communications hardware, firmware and software.” Further, the FCC will work with NIST and academia to “understand the current state of professional standard and accountability,” as well as “where the FCC might positively contribute toward further professionalization of the workforce.”

This initiative could have significant impact on telecommunications and technology companies. Cybersecurity already is a top priority for CSRIC. A new working group was established within CSRIC and work is underway to update the industry’s cybersecurity best practices. The primary goal is to align the industry’s cybersecurity activities with the National Institute of Standards and Technology’s (NIST) Cybersecurity Framework Version 1.0 released in February 2014. Industry members are encouraged to participate in the process. Based on the current timeline, CSRIC will vote to approve the new best practices in March 2015.

Kelley Drye & Warren’s attorneys recently presented a webinar discussing cybersecurity updates and considerations for the telecommunications and technology industries. To listen to a recording of The Cybersecurity Review webinar, please click here.

As Lincoln said, “Nearly all men can stand adversity, but if you want to test a man’s character, give him power.”

It’s a familiar enough idea. You see it in both Macbeth and the genesis story of just about every Marvel supervillan. It’s true, I think, not just of people but also of institutions. Like governments.

Just about every time I go to federal court for a sentencing hearing — where it seems the AUSA is fighting for each additional month in prison like it will take a point off his mortgage — I think about this quote from Nietzsche:

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This should be a no-brainer.

– President Barack Obama, who once profited from ridiculous tuition rates, after signing a memorandum expanding a program to cap student loan repayments at no more than 10 percent of what borrowers actually earn in the workplace. The President’s comment was directed at a related bill in Congress to allow student borrowers to refinance their loans at lower rates.

Justice Stephen Breyer

On Friday, the National Archives unsealed a fifth batch of Clinton Administration presidential papers. The documents were originally released by the William J. Clinton Presidential Library in Little Rock. Let’s get these pesky papers out of the way before Hillary Clinton, author of a new memoir (affiliate link), launches her presidential bid.

The latest papers contain some juicy tidbits for legal nerds. For example, as noted in Morning Docket, then-Judge Stephen Breyer got dissed as a “rather cold fish” while being considered for a Supreme Court seat (the seat that ultimately went to Justice Ruth Bader Ginsburg).

The papers contain candid assessments of Justices Breyer and Ginsburg, as well as other fun nuggets. Here are some highlights:

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The Friday before the long Memorial Day weekend is either a desert of regulatory activity or – as last week – a cornucopia in need of distillation. Three highlights warrant note, though many rules were published, placed on inspection, or otherwise released. The United States Court of Appeals for the District of Columbia Circuit vacated a Federal Energy Regulatory Commission (FERC) electric distribution pricing rule while the United States District Court for the District of Columbia vacated a Department of Health and Human Services (HHS) orphan drug pricing rule. Look now for the next round of economic mischief by regulation in the Office of Management and Budget (OMB) under-the-radar release of the Spring 2014 Unified Agenda. And lest we forget ….

Electric Power Sales: The D.C. Circuit vacated as ultra vires a FERC final rule incentivizing retail customers to reduce electricity consumption when economically efficient because the rule exceeded FERC’s statutory authority to regulate wholesale and interstate electricity distribution by regulating intra-state retail sales – the province of state public utility commissions (PUCs) – in Electric Power Supply Assoc. v. FERC.

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Do you know where your data is? According to the Federal Trade Commission, the answer is “no.”

The agency wants Congress to intervene against data brokers – companies that collect personal information and resell it, mainly for marketing purposes. The FTC released a report on Tuesday of the top nine data brokers in the US and how most Americans don’t know that their personal information is being collected.

According to the Chronicle of Data Protection,

the FTC states that consumers may benefit from increased transparency into the operations of data brokers. It notes that data brokers collect and store billions of data elements covering nearly every U.S. consumer, in many cases without consumers’ knowledge. The FTC recommends that Congress consider enacting legislation to make data broker practices more visible to consumers and to give consumers greater control over the handling of their information by data brokers.

The data collected by firms like Acxiom, Datalogix and Corelogic range from the innocent (what sports you follow) to the personal (health and financial information) and everything in between (what kind of car you drive and general shopping habits).

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