Karl Herchenroeder

The FTC should continue presuming viewers of youth-directed online content are children, despite efforts from YouTube and the tech industry seeking carve-outs for adults watching it. It’s a central issue in the agency’s review of the Children’s Online Privacy Protection Act rule (see 1912090061), based on comments in docket 2019-0054 collected through Thursday.

Senate Republicans are eager to pass the U.S.-Mexico-Canada Agreement, despite reservations about including language shielding the tech industry from content liability. House Speaker Nancy Pelosi, D-Calif., announced an agreement with the White House on USMCA Tuesday (see 1912100012). Senate Majority Leader Mitch McConnell, R-Ky., said that chamber will consider the trade pact in 2020 (see 1912100015).

Apple and Google need to voluntarily provide better device access, or Congress will force them to alter encryption standards and accommodate lawful police searches, Senate Judiciary Committee members from both parties said Tuesday. The panel and representatives from Apple and Facebook debated end-to-encryption during a Tuesday hearing, at which law enforcement slammed Apple’s decision in 2014 to engineer devices in a way that effectively blocks police access.

The Copyright Office is 95 percent complete with GAO 2015 IT modernization recommendations, Librarian of Congress Carla Hayden told the Senate Intellectual Property Subcommittee Tuesday. Copyright Office Director Karyn Temple, who leaves the CO after eight years for the Motion Picture Association (see personals section, Dec. 10), didn’t testify. Hayden detailed IT initiatives as the CO looks to reach 100 percent “very soon.” The online recordation system will allow users to record information on copyright ownership using a digital platform. The office is launching a new public records system to allow the public to search all copyright records. She said a limited recording pilot is expected in spring 2020, a proof of concept for the public records system in late 2020 and a next-generation registration system is expected to be in “full-scale” development later that year. Congress’ initial investment in copyright modernization was about $12 million for five years, and the CO is entering year two. Monday, Chairman Thom Tillis, R-N.C., and ranking member Chris Coons, D-Del., issued a CO modernization bill draft based on subcommittee roundtables (see 1907300069). Key conclusions from the roundtables, Tillis said, are the need for improved communication and transparency for those who use the copyright system daily. It’s essential there isn’t another prolonged period without a Register of Copyrights, he added. The office is working to reduce registration pendency times, modernize IT systems and implement the Music Modernization Act, he noted. CO acting Chief Financial Officer Jody Harry testified it could staff up quickly to implement the Copyright Alternative in Small-Claims Enforcement Act, if passed (see 1910250047), and associated IT needs are “minimal.” Tillis asked about the pros and cons of potentially updating Title 17, through the legislation, to make the CO statutory and essentially align it with the Congressional Research Service at the Patent and Trademark Office. CO centralization and management is analogous to CRS independence and autonomy, Hayden said. Having the ability to interact directly with Congress is a benefit, she said.

Rep. Suzan DelBene, D-Wash., urged support for her privacy legislation, which she said would allow state attorneys general to obtain injunctive relief. During an interview with The Communicators, online Friday and to have been televised on C-SPAN over the weekend, she repeatedly cited her Information Transparency and Personal Data Control Act (HR-2013) (see 1903040054). Asked about including a private right of action, a sticking point in the privacy legislation debate, DelBene cited the need for strong enforcement from the FTC and state attorneys general. EU’s general data protection regulation and states moving forward with their own laws are major reasons for the U.S. to pass federal privacy legislation, she said: Without a federal law, the U.S. isn’t at the international table setting the standard. On slow progress in passing privacy legislation, she said it’s a complicated issue that not everyone is comfortable discussing. It would be “wonderful” to move faster, but Congress is making progress, she said. Congress can protect both consumers and innovation, but consumers need clarity on how data is collected, shared and used, she argued. The FTC needs authority to make privacy rules and inflict penalties through enforcement that has teeth, said DelBene. On antitrust, the tech industry isn’t in a unique position and is subject to competition law like any other sector, she said.

The FTC “effectively removed” Facebook’s independent privacy assessor (see 1912050065), Chairman Joe Simons wrote recently in a congressional letter. We obtained the document in response to a Freedom of Information Act request. Senators reached Thursday were skeptical that the FTC's $5 billion settlement resulted in meaningful structural change at Facebook.

Privacy proposals from Senate Commerce Committee Republicans and Democrats both provide stronger consumer protections than California’s privacy law, said Chairman Roger Wicker, R-Miss., Wednesday. During a long-awaited hearing, ranking member Maria Cantwell, D-Wash., raised concerns about third-party data sharing. Lawmakers gave varying views on a private right of action.

The FTC “effectively removed” Facebook’s independent privacy assessor, Chairman Joe Simons wrote a legislator in a letter we obtained.

Senate Commerce Committee Chairman Roger Wicker, R-Miss. is “open to discussing” a narrowly tailored private right of action provision in a compromise data privacy bill. He told reporters Monday any discussion of such a provision would be part of broader negotiations “in good faith" to try to win Democrats' support. The committee plans a hearing 10 a.m. Wednesday (see 1911250058).

Qualcomm has monopoly power in two key chip markets, maintained by refusing licenses to rival chipmakers, the FTC argued to the 9th U.S. Circuit Court of Appeals (see 1910100017). Oral argument is set for 9:30 a.m. Feb. 13 in San Francisco. Qualcomm and DOJ said previously that the lawsuit and lower court’s injunction threaten national security, given Qualcomm’s role in leading 5G advancement against Chinese rivals. The FTC called those claims “purely speculative.” Intel supported the commission in the case, also announcing it agrees with the district court’s finding “Qualcomm’s licensing practices have strangled competition in the CDMA and premium LTE modem chip markets for years, and harmed rivals, OEMs and end consumers.” Intel claims it “suffered the brunt of Qualcomm’s anticompetitive behavior, was denied opportunities in the modem market, was prevented from making sales to customers and was forced to sell at prices artificially skewed by Qualcomm.” Ericsson and Samsung previously argued in favor of Qualcomm, with Samsung saying contract and patent law are “better suited” for settling disputes about fair, reasonable and nondiscriminatory (FRAND) terms. American, Japanese and German automaker groups said prices of cars with 5G will likely increase if Qualcomm wins. The Alliance of Automobile Manufacturers and Denso with Continental Automotive Systems filed briefs. “Automakers have been forced into unnecessary and inefficient [standard-essential patent] licensing negotiations ... even though chip sales that exhaust patent rights ... would negate the need for such negotiations while allowing the patentee to be compensated for its inventions based on the price charged for a chip,” the alliance argued. That will worsen if Qualcomm practices are ratified, it said. The Computer & Communications Industry Association supports the agency, saying Qualcomm has an “antitrust duty” to license competing chip manufacturers on FRAND terms. Open Markets also supported the FTC, saying in a release that Qualcomm practices compel “smartphone and tablet producers to pay exorbitantly high amounts for their chips.” The company didn’t comment Monday. The 9th U.S. Circuit Court of Appeals scheduled Feb. 10 oral argument on challenges of FCC wireless infrastructure orders (see 1912020018).