Administrative Law

Trump’s Shortsighted Proposal Would Shatter the Patent System

November 17, 2025
Administrative Law, Intellectual Property, Patents

Charlotte Lucas, JLST Staffer

The overall objectives of the U.S. patent system are to foster innovation, maintain inclusivity and fairness to all potential patent applicants, and achieve overall financial balance.[1] A patent, because it grants the patent holder a temporary monopoly of their invention, inherently has costs and benefits to society. Patent holders are able to face less competition for their product and thus make more money from it during the patent period, which incentivizes inventors to put time and money into developing new inventions that can benefit society.[2] However, the fact that patents create a monopoly on that invention, forcing consumers to spend more money than the market value to obtain a patented invention, is a cost to society.[3]

The patent system works by charging patent holders fees to obtain and maintain patents.[4] The fees cover the services that the United States Patent and Trademark Office (“USPTO”) provides.[5] Entities file for patents, and the size of that entity determines the fee amount.[6] The USPTO charges fees for filing and examining an application, for issuing a patent, and for maintenance during the 20-year life of the patent.[7]

The current fee system has multiple goals, one being to achieve financial balance for the USPTO by covering the costs of the patent process.[8] The discounts for small and micro entities are meant to foster innovation and increase fairness by lowering the barrier to obtaining and maintaining patents.[9] Additionally, charging maintenance fees will decrease the number of patents currently in effect, especially economically unviable ones, because not all entities will maintain all their patents.[10] Overall, the current fee model works, at least to make money for the USPTO. The USPTO estimated almost $4 billion in income from patent fees last year.[11] The USPTO does not cost taxpayers money and just runs on the fees paid by current patent holders.[12]

The Trump Administration is discussing charging patent holders fees equal to a percentage of their overall patent value.[13] The proposed percentage would be one to five percent.[14] The new fee system “would be a much more exorbitant cost for some patent holders that would function like a property tax.”[15] It would be a complete change to the 235-year-old patent system and a stark departure from the practices of any foreign country.[16] Whether the proposal would replace or add to the current fee system is unclear.[17]

The presidential administration suggests using the revenue to pay the national debt or for purposes in other areas of the government.[18] The administration is also considering a budget item for the USPTO that could transfer the extra money to other agencies of the government.[19] Trump nominated John Squires (“Squires”) to the position of USPTO director, and the Senate confirmed his appointment.[20] Squires, as a nominee and supporter of Trump, is expected to support the proposed fee system.[21] The USPTO’s authority to set its fees expires next year, and, therefore, Congress may change the way that the patent fee system works to be in line with the proposal, or Congress may prevent the USPTO from changing the system.[22]

Congress, and not the executive branch, has the power to levy taxes.[23] The USPTO has the right, granted by Congress, to charge fees to patent holders to pay for the services the USPTO provides.[24] However, charging patent holders a percentage of the overall patent value may constitute a tax more than a fee. The primary purpose of the proposed plan is to raise money for the government, generally to pay off the deficit or for services outside of the USPTO.[25] Such a goal is usually the purpose of a tax.[26] In contrast, the purpose of a fee is to pay for the cost of the specific services provided to the payer of the fee, such as the services the USPTO provides to patent applicants.[27] Additionally, the voluntariness of obtaining a patent and thus paying the proposed fees is not relevant to determining if the charge is a tax or a fee.[28] If someone voluntarily purchases alcohol at a store, they have to pay a sales tax, not a sales fee. The sales tax, although voluntary because no one has to purchase alcohol, still has the primary purpose of general revenue raising, not paying for a specific service. This would be the same as charging patent holders a percentage of the overall patent value, because, although voluntary, it would raise money, generally not just for the USPTO’s services.

In addition to the potential legal issues, several implementation and policy concerns exist. First, how or when the patent value will be assessed is unclear.[29] Patents can have commercial value but also hold value for the amount for which the patent owner could sell or license the patent. The commercial value of a patent is unknown at the time the patent is granted.[30] Even if the amount is assessed multiple times during the patent term, many different components go into how valuable a patent is.[31] For example, a patent granted to Apple to be used in an iPhone is working alongside hundreds of other patents in the phone. How would the government decide how the success of an iPhone is split among all the patents? Also, Apple’s branding, reputation, business model, and previous customer base are other factors contributing to an iPhone’s success. Would the government account for that, and if so, how?

If the government equates the overall patent value to the amount for which the patent owner could sell or license the patent, additional concerns are raised. How would the government determine that amount accurately? Especially because the patent owner may not want to sell or license the patent, or might not have any competitors interested in that specific patent on its own, despite being valuable.

If the government determines how to assess the patent value, the proposal might not even raise money for the government. First, many patents already do not have a significant amount of commercial value.[32] The holders of those patents sometimes let the invaluable patents lapse, but sometimes keep the patents active and pay the maintenance fees. The holders of commercially invaluable patents under the new system likely would not be paying that much in fees and would not make that much money for the government. Second, some potential patent holders may not even apply for a patent because of the possible taxes and instead rely on trade secret protection or first-to-market benefits. Not only would that mean that the USPTO would not get any revenue from that potential patent, but the potential decrease in patents would not encourage innovation or the distribution of knowledge. Third, large companies with many resources would likely find loopholes or reorganization tricks to limit the value of their patents.[33] Companies would be spending money and time on avoiding or limiting the tax rather than on R&D, thus limiting and discouraging innovation and not truly raising money for the government.[34] Fourth, the government would have to create a system to determine the value of the 3.5 million active U.S. patents, which would be very expensive.[35] Additionally, patent holders upset at the valuations could try to contest the amount, leading to a significant amount of litigation.[36] Therefore, the plan would raise operating costs for the USPTO and not lead to more money to pay off the government deficit.

The proposed plan would likely achieve the opposite of the USPTO’s goals. Any money that companies make from the patents they own is already taxed on the federal and state levels. More money that companies have to pay under the proposal to maintain patents would take money away from their profits and reduce investment into R&D, therefore decreasing innovation. Small businesses and start-ups would be the most impacted. They have the least amount of money to pay any patent fees, and often they hold patents as their primary assets. Forcing them to pay more to maintain would decrease the likelihood of innovation. It would not encourage fairness, and it would increase the barrier to entry for gaining a patent, the opposite of what the current system attempts to achieve with its tiers of patent fees.

Overall, the proposed system would discourage innovation, decrease fairness, and be difficult to implement. The system probably would not even achieve the goal of raising money for the government due to the increased costs of implementing the system. Additionally, legal challenges and backlash from patent-holding companies are likely. The proposal would be a drastic shift in how the patent system works and would make the U.S. a significant outlier in the world.

 

Notes

[1] Gaétan de Rassenfosse & Adam B. Jaffe, Framework for Analysis of U.S. Patent Fee Structure Options 2 (Dec. 2024),  https://www.uspto.gov/sites/default/files/documents/UAIA_Fee_Study_Framework_for_Analysis.pdf.

[2] Id. at 10–12.

[3] Id.

[4] Id. at 2.

[5] Id.

[6] 37 C.F.R. § 1.16.

[7] 37 C.F.R. §§ 1.16, 1.17, 1.18, 1.20.

[8] De Rassenfosse & Jaffe, supra note 1.

[9] Id. at 16–18.

[10] Id. at 18–19.

[11] United States Patent and Trademark Office, Fiscal Year 2025 Congressional Submission 3 (Mar. 2024), https://www.uspto.gov/sites/default/files/documents/fy25pbr.pdf.

[12] Id.

[13] Amrith Ramkumar, Trump Administration Weighs Patent System Overhaul to Raise Revenue, Wall St. J., July 28, 2025, https://www.wsj.com/politics/policy/patent-system-overhaul-18e0f06f?gaa_at=eafs&gaa_n=AWEtsqcrNTdIjXDybihSzFhBXwdMfKp1P3twYDq3pdyZ1O9OqaQjMcPsCTRSSd162eE%3D&gaa_ts=69167aa4&gaa_sig=sn7mig18LPadrQwSl70zopRzxIWhd-iGUBVS5lUE7D6lZS-f4l7FaJOwcYTLujXukFEKbMBrfD0SCOOLFvxJhw%3D%3D.

[14] Id.

[15] Id.

[16] Id.

[17] Id.

[18] Id.

[19] Id.

[20] Press Release, United States Patent and Trademark Office, USPTO Welcomes New Director John A. Squires (Sept. 22, 2025), https://www.uspto.gov/about-us/news-updates/uspto-welcomes-new-director-john-squires.

[21] Ramkumar, supra note 13.

[22] Id.

[23] U.S. Const. art. I, § 8, cl. 1.

[24] De Rassenfosse & Jaffe, supra note 1, at 2.

[25] Ramkumar, supra note 13.

[26] Nat’l Cable Television Ass’n, Inc. v. United States, 415 U.S. 336, 340–41 (1974).

[27] Id.

[28] See generally, Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519 (2012) (determining that the individual mandate penalty was a valid tax, even though it was a voluntary choice for citizens to not purchase insurance and thus pay the individual mandate penalty).

[29] Rodrigo Balbontin, Taxing Patent Value Is a Patently Bad Idea, Info. Tech. & Innovation Found. (Aug. 4, 2025), https://itif.org/publications/2025/08/04/tax-on-patent-value-is-a-patently-bad-idea/.

[30] Id.

[31] Id.

[32] Sujai Shivakumar & Chris Borges, Don’t Tax Invention: The Risks of a Patent Tax, Ctr. for Strategic & Int’l Stud. (Sept. 4, 2025), https://www.csis.org/analysis/dont-tax-invention-risks-patent-tax.

[33] Balbontin, supra note 29.

[34] Id.

[35] Shivakumar & Borges, supra note 32.

[36] Id.

The [In]adequate Provision Loophole: The Future of Drug Advertisements

November 10, 2025
Administrative Law, Food and Drug Law, Telecommunication

Caelen Caspers, MJLST Staffer

The television shows a sunny day, birds chirping, and kids skipping. A journal staffer attempts to join in, but winces in remembrance of cite checks. The narrator sighs and explains that life’s moments should not be interrupted by the discomfort of bluebooking. Loudly, the narrator cuts in, “That’s why there’s LawRizzy—clinically proven to relieve the racking pain of cite checks.” The narrator directs you to talk to your healthcare provider and rambles off a few side effects.

Sound familiar? Direct-to-consumer (“DTC”) drug broadcasts have become prolific on our television, social media, podcasts, etc. The rise of DTC advertising is attributed mainly to the “adequate provision loophole”[1]—a regulatory text utilized by drug companies to minimize risk disclosures and instead refer viewers to a secondary source for additional information.[2]

On September 9, 2025, the Food and Drug Administration (“FDA”) announced plans to rescind the loophole.[3] Without it, pharmaceutical companies would have to provide a disclosure of all necessary information related to a drug’s side effects and contraindications in their advertisements.[4] Controversy has since ensued.

 

Statutory Context

Currently, the law requires that broadcast advertisements must include a “major statement” of “information relating to major side effects and contraindications . . . of the advertised drugs.”[5] Additionally, the advertisements must contain a “brief summary of all necessary information related to [the major statement], unless adequate provision is made for dissemination of the approved or permitted product labeling in connection with the broadcast presentation.”[6]

The provision did not garner loophole status until 1997, following guidance by the FDA,[7] wherein a drug company provides an adequate provision by presenting “reasonably convenient access” to the product’s labeling.[8] This can be accomplished by disclosing a toll-free number, print page, webpage, and a directive to speak to a medical professional.[9] Lucy Rose, a former FDA employee involved in drafting the guidance, explained that the purpose of the is regulation not as a loophole, but rather to balance “the demands for marketing new drugs and informing patients.”[10]

 

The Controversy

Indeed, there are many persuasive arguments in favor of the adequate provision loophole. First, proponents argue that it is essential to avoid burdening the consumer with bulky risk information.[11] The mass of information merely functions to fearmonger, desensitize, and dilute more serious risks among minor issues.[12] Second, proponents underscore the benefits to public health, such as public awareness and market competition.[13] Moreover, standards for disclosure and fair balance are well-established, hence, if the administration were to enforce the existing law, then there would be no need for eliminating the provision.[14] Finally, proponents warn that the FDA’s proposed action will have a chilling effect on drug companies’ First Amendment rights.[15]

Those adverse to the provision argue that it is “used to conceal critical safety risks in broadcast and digital ads, fueling inappropriate drug use and eroding public trust.”[16] The FDA contends that DTC ads lead to more prescription requests and inappropriate prescribing.[17] FDA Commissioner, Marty Makary, stressed that the 25% of drug companies’ budget towards advertising could be “better spent on lowering drug prices for everyday Americans.”[18] Furthermore, the FDA admitted to difficulty in regulating DTC advertising in social media, making it “increasingly difficult for patients to distinguish between evidence-based information and promotional material.”[19]

 

The Future

It is easy to envision the provision in practice, given the unavoidability of DTC advertisements on our screens. You anticipate the statement “ask your health provider about LawRizzy! Side effects include panic attacks, failing journal, or dizziness.” Without it, advertisers would be required to include a “brief summary of all necessary information related to the major side effects and contraindications.”[20]

But what constitutes a brief summary? Health and Human Services (“HHS”) Secretary Robert F. Kennedy proclaimed “[o]nly radical transparency will break the cycle of over-medicalization that drives America’s chronic disease epidemic.”[21] Thus, on one extreme, it appears that the purpose of the rescission is part of a larger effort to ban DTC drug advertisements altogether.

Is it realistic that the FDA can curtail all drug advertisements? Before to 1997, drug advertising in the United States was virtually non-existent.[22] However, given that DTC ads have become industry standard, it might be too difficult to put the mouse back in the bag. And, Big Pharma is unlikely to go quietly, likely to give rise to immense litigation.[23]

The FDA has yet to release guidance on what constitutes presentation of a “brief summary.”[24] One might expect subsequent guidance from the FDA, as done prior with “major statement” in 2023[25] and “adequate provision” in 1999.[26] Until it does, the future landscape of DTC drug advertising will remain uncertain.

 

Notes

[1] U.S. Dep’t Health & Hum. Servs., HHS, FDA to Require Full Safety Disclosure in Drug Ads (Sept. 9, 2025), https://www.hhs.gov/press-room/hhs-fda-drug-ad-transparency.html.

[2] See Login H. Merril, The FDA Just Killed Big Pharma’s Favorite Loophole, Freedom (Sept. 20, 2025), https://www.freedommag.org/news/the-fda-just-killed-big-pharmas-favorite-loophole-d87bf6 (explaining the adequate provision).

[3] U.S. Food & Drug Admin., FDA Launches Crackdown on Deceptive Drug Advertising (Sept. 9, 2025), https://www.fda.gov/news-events/press-announcements/fda-launches-crackdown-deceptive-drug-advertising.

[4] Id.

[5] 21 C.F.R. 202.1(e)(1)(i)(A).

[6] 21 C.F.R. 202.1(e)(1)(i)(B) (emphasis added).

[7] U.S. Food & Drug Admin., Guidance for Industry: Consumer Directed Broadcast Advertisements 2–3 (Aug. 1999), https://www.fda.gov/media/75406/download.

[8] Id. x

[9] Id.

[10] See Annalee Armstrong, In New DTC Ad Crackdown, FDA Trying to Close a Loophole That Isn’t, Biospace (Sept. 17, 2025), https://www.biospace.com/policy/in-new-dtc-ad-crackdown-fda-trying-to-close-a-loophole-that-isnt (citing Lucy Rose, A Response and Suggested Path Forward to FDA’s Fact Sheet, LinkedIn (Sept. 15, 2025), https://www.linkedin.com/pulse/response-suggested-path-forward-fdas-fact-sheet-ensuring-lucy-rose-jrple/?trackingId=h8%2BVIWXVSpKr4lMOeqQnQA%3D%3D).

[11] See James A. Boiani, et al., HHS, FDA Target Direct-to-Consumer Drug Advertising: A Paradigm Shift in Patient-Focused Communications, 15 Nat’l L. Rev. 278, 278 (Sept. 29, 2025), https://www.healthlawadvisor.com/hhs-fda-target-direct-to-consumer-drug-advertising-a-paradigm-shift-in-patient-focused-communications (explaining the importance the adequate provision).

[12] Id.

[13] Id.

[14] Id. (discussing enforcement of existing law).

[15] Joanne S. Eglovitch, FDA Cracks Down on Drug Ads, Promises to End the Adequate Provision ‘Loophole’, Regul, Focus (Sept. 10, 2025), https://www.raps.org/news-and-articles/news-articles/2025/9/fda-cracks-down-on-drugs-ads,-promises-to-end-adeq (“[T]ruthful and non-misleading DTC advertising is protected under the First Amendment and has documented evidence of advancing patient awareness and engagement.”)

[16] U.S. Food & Drug Admin., supra note 3 (citing Mor, et. al., Pharmaceutical Industry Promotional Activities on Social Media: A Scoping Review, 15 J. Pharm. Health Servs. Rsch. 1 (2024)).

[17] Id.

[18] Id.

[19] Id.

[20] 21 C.F.R. 202.1(e)(1)(i)(B).

[21] U.S. Food & Drug Admin., supra note 3 (emphasis added).

[22] Boiani, supra note 11.

[23] See Eglovitch, supra note 15 (discussing potential litigation on First Amendment grounds).

[24] See HHS and FDA Declare “Crackdown” on Drug Advertising and Promotion, King & Spalding (Sept. 10, 2025), https://www.kslaw.com/news-and-insights/hhs-and-fda-declare-crackdown-on-drug-advertising-and-promotion (“[The FDA] has not specifically addressed the presentation of the ‘brief summary’”).

[25] Direct-to-Consumer Prescription Drug Advertisements: Presentation of the Major Statement in a Clear, Conspicuous, and Neutral Manner in Advertisements in Television and Radio Format, 88 Fed. Reg. 80958 (Nov. 21, 2023) (to be codified at 21 C.F.R. pt. 202).

[26] U.S. Food & Drug Admin., supra note 7.

New British Antitrust Legislation Provide Model for U.S. Tech Regulation

September 24, 2025
Administrative Law, Antitrust, EU Law, International Law

Carson Holmgren, MJLST Staffer

The rapid rise of generative AI in recent years has boosted key players in the field to record-breaking valuations.[1] Yet many major firms lack the server capacity needed to operate their models at scale and rely heavily on third-party cloud service providers (“CSPs”) to meet their computing needs.[2] This dependency has fueled massive growth in the CSP industry, with annual global revenue predicted to exceed $400 billion in 2025[3] and $2 trillion by 2030.[4] Roughly 60% of the global CSP market is controlled by just three U.S. companies: Amazon Web Services, Microsoft Azure, and Google Cloud.[5] While critics warn of the risk in letting so few companies dominate the cloud,[6] Washington has largely stood idle and allowed these companies to consolidate their position in the market. However, recent legislation in the United Kingdom may offer U.S. policymakers a blueprint for creating a more completive CSP market.

The U.S. has adopted a passive stance towards CSP regulation for two primary reasons: a reactive antitrust framework and a political environment hostile to regulation.

U.S. antitrust law focuses not on a firm’s position in the market, but whether the firm’s conduct harms competition.[7] These harms may be difficult to quantify[8] but are primarily measured through effects on consumer welfare, such as higher prices or reduced output.[9] Absent the manifestation of such harms, private parties are unable to sue, and regulators are unable to take aggressive enforcement actions.[10] Private and public actors must essentially wait for anticompetitive behavior to occur and cause harm before they can act.

The current political context reinforces this inertia. The Trump administration has cultivated close ties with tech firms[11] and pushed a broader deregulatory agenda.[12] Aggressively regulating firms seen as friendly to the administration is, therefore, a low political priority.

The United Kingdom has presented an alternative to this passive approach. In 2024, the U.K. House of Commons passed the Digital Markets, Competition and Consumers Act (“DMCCA”), aimed at expanding the regulatory powers the Competition and Markets Authority (“CMA”) may exert over tech companies.[13] Unlike the current U.S. framework, the DMCCA allows the CMA to act before market harms manifest, establishing a more proactive regulatory regime.[14]

One of the new powers granted to CMAs is the ability to designate a company as having strategic market status (“SMS”). An SMS designation requires findings of entrenched market power, strategic significance to digital markets, and meeting turnover thresholds.[15] Firms having SMS are subject to additional oversight, including Conduct Requirements (“CRs”) and Pro-Competition Interventions (“PCIs”).[16]

CRs regulate how SMS-designated firms interact with consumers, competitors, and partners, imposing baselines of fair conduct.[17] CRs may prohibit discriminatory conditions against particular users, prevent self-preferencing, ensure interoperability with rival services, and mandate that sensitive user data not be used to secure an unfair advantage.[18]

PCIs can be implemented through Pro-Competition Orders (“PCOs”) and are structural sanctions aimed at attacking the source of a company’s entrenched market power. A PCO may require a company to make fundamental changes to their operations, and are distinguishable from CRs in that they are considered on-off interventions designed to reshape the competitive environment itself.[19]

How the CMA will apply its powers under the DMCCA remains uncertain, as the regime is still in its early phases. The first DMCCA investigation was launched in January 2025 and resulted in a proposal to issue Google’s search engine an SMS designation.[20] This proposal was positively received by academics and consumer advocacy groups,[21] but no CRs or PCIs have been introduced.

The U.K.’s CSP market is similarly concentrated, with Amazon Web Services and Microsoft Azure controlling roughly 80% of the market.[22] On July 31, 2025, the CMA published the findings of a pre-DMCCA report, noting that the two firms market dominance harms competition.[23] The report recommended SMS investigations, making it likely that both firms will eventually be designated as having SMS.

While no CRs or PCIs have been proposed, the report hints at what actions the CMA may take. It notes that less than 1% of users change CSPs annually, largely due to artificial barriers, including self-preferencing software compatibility requirements and high egress fees when migrating data to rival services.[24] The CMA could remove these barriers by issuing CRs requiring interoperability between competitors and limiting egress fees. Such actions would increase user mobility and spur greater competition between CSPs.

Microsoft’s licensing practices were also flagged as a concern. The CMA found that users had to adopt a full suite of Microsoft products to use Microsoft Azure effectively, making it difficult to change CSP once adopted. Microsoft can extract such concessions from customers due to its dominant operating system and software. To address this entrenched power, something more substantial than a CR is required. A one-off PCI, such as unbundling software or adjusting licensing terms for Microsoft Azure customers, could reduce Microsoft’s structural advantage and open up the market.

The DMCAA provides a model of what proactive antitrust regulation could look like in the United States. Critical components of the emerging AI economy are highly concentrated and ripe for anticompetitive exploitation. Adopting legislation mirroring the DMCCA would allow U.S. regulators to set clear rules for fair conduct upfront, rather than relying on long, resource-intensive efforts to break up monopolies after the damage is already done.

 

Notes

[1] Skye Jacobs, AI Boom Drives Record S&P 500 Valuations, but Goldman Sachs Warns of $1 Trillion Risk Ahead, TechSpot (Sept. 6, 2025), https://www.techspot.com/news/109358-ai-boom-drives-record-sp-valuations-but-goldman.html.

[2] Nihad A. Hassan, The Impact of Generative AI on Cloud Infrastructure Demand, Cybernews (May 3, 2025), https://cybernews.com/security/generative-ai-cloud-infrastructure.

[3] Felix Richter, The Big Three Stay Ahead in Ever-Growing Cloud Market, Statista (Aug. 21, 2025), https://www.statista.com/chart/18819/worldwide-market-share-of-leading-cloud-infrastructure-service-providers.

[4] Goldman Sachs, Cloud Revenues Poised to Reach $2 Trillion by 2030 Amid AI Rollout (Sept. 4, 2024) https://www.goldmansachs.com/insights/articles/cloud-revenues-poised-to-reach-2-trillion-by-2030-amid-ai-rollout.

[5] Id.

[6] Max Von Thun, Cloud Computing is Too Important to be Left to the Big Three, Financial Times (May 25, 2025), https://www.ft.com/content/5c930686-9119-402d-8b9b-4c3f6233164e.

[7] Daniel Francis, Antitrust Without Competition, 74 Duke L.J. 353, 355–56 (2024).

[8] Id.

[9] Lina M. Khan, The Amazon Anti-Trust Paradox, 126 Yale L.J. 710, 720 (2017).

[10] Herbet Hovenkamp, Antitrust Harm and Causation, 99 Wash. U. L.R. 787, 837–38 (2022).

[11] Ali Swenson, These Tech Billionaires Flanked Trump at Inauguration, AP News (Jan. 20, 2025) https://apnews.com/article/trump-inauguration-tech-billionaires-zuckerberg-musk-wealth-0896bfc3f50d941d62cebc3074267ecd.

[12] See The White House, President Trump, Tech Leaders Unite to Power American AI Dominance (Sept. 5, 2025) https://www.whitehouse.gov/articles/2025/09/president-trump-tech-leaders-unite-american-ai-dominance/; see also Alexandra Charbi & Juan Rojas, Merger Enforcement Policies of the Second Trump Administration: Early Developments and Priorities, ABA Antitrust L. Section (Aug. 29, 2025), https://www.americanbar.org/groups/antitrust_law/resources/newsletters/merger-enforcement-policies-second-trump-admin.

[13] See White & Case LLP, Navigating the New UK Antitrust Landscape (Jan. 8, 2025), https://www.whitecase.com/insight-alert/navigating-new-uk-antitrust-landscape.

[14] Id.

[15] Competition and Markets Authority, How the UK’s Digital Markets Competition Regime Works (last updated Jan. 23, 2025), https://www.gov.uk/guidance/how-the-uks-digital-markets-competition-regime-works?ucriteria-for-strategic-market-status.

[16] Id.

[17] Lisa Mildt, Nanret Senok & Luke Streatfield, Remedies Under the DMCCA: A New Digital Regulation Toolkit in the U.K., Hausfeld Competition Bull., (Mar. 28, 2025) https://www.hausfeld.com/what-we-think/competition-bulletin/remedies-under-the-dmcca-a-new-digital-regulation-toolkit-in-the-uk.

[18] Id.

[19] Id.

[20] Competition and Markets Authority, Strategic Market Status Investigation Into Google’s General Search Services (June 24, 2025) https://assets.publishing.service.gov.uk/media/68598b13eaa6f6419fade67b/Proposed_decision.pdf.

[21] Anush Ganesh, Google SMS Designation Responses – A Comprehensive Analysis, SCiDA (Sept. 11, 2025) https://scidaproject.com/2025/09/11/google-sms-designation-responses-a-comprehensive-analysis/.

[22] Competition and Markets Authority, supra note 22.

[23] Id.

[24] Id.

How Workers Can Respond to Increased Use of Generative Artificial Intelligence

January 21, 2025
Administrative Law, Artificial Intelligence, Employment Law, Industry

Yessenia Gutierrez, MJLST Staffer

Recent advances in generative Artificial Intelligence (AI) have generated a media buzz and revived worries about the future of work: How many jobs are at risk of being eliminated? Can workers be retrained to work new jobs that did not exist before, or new versions of their now technologically-augmented jobs? What happens to those workers who cannot be retrained? What if not enough jobs are created to compensate for those lost?

It is hard to calculate the pace, extent, and distribution of job displacement due to technological advancements.[1] However, there is general agreement among business leaders that there will be significant job losses due to AI.[2] Professions spanning the education and income spectrum may be impacted, from surgeons to investment bankers to voice actors.[3]

Nevertheless, the jobs predicted to be most impacted are lower-paid jobs such as bank tellers, postal service clerks, cashiers, data entry clerks, and secretaries.[4]

Proponents of rapid AI adoption emphasize its potential for creating “a productivity boost for non-displaced workers” and a resultant “labor productivity boom.”[5] While that will likely be true, what remains uncertain is who will reap the majority of the benefits stemming from this boom — employers or their now more productive workers.

One of the main concerns about increasing use of AI in the workplace is that entire job classifications will be eliminated, leaving large swaths of workers unemployed. There is no consensus over whether technology has created or eliminated more jobs.[6] However, even assuming technological advances have created more jobs than those rendered obsolete, the process of large numbers of workers switching from one type of job to another (perhaps previously nonexistent) job still creates serious challenges.

For one, this process adds stress on an already economically- and emotionally-stressed population.[7] The Center for Disease Control credits “fears about limited employment opportunities, perceptions of job insecurity, and anxiety about the need to acquire new skills” as contributing to “public health crises such as widespread increases in depression, suicide, and alcohol and drug abuse (including opioid-related deaths).”[8] Those workers able to keep their jobs have less bargaining power, as they fear speaking up about possible health, safety, and other concerns for fear of losing their job.[9]

To assist in this transition, some argue that more government intervention is necessary.[10] In fact, several states have enacted legislation regulating the use of AI in employment matters, including protections against discrimination in employment decisions made using AI.[11] Some states are also experimenting with AI training for high school seniors and state employees, sometimes with encouragement from major employers.[12] Federal politicians are also considering legislation, although none has passed.[13]

Some commentators argue that workers themselves have a responsibility to learn skills to remain competitive in the labor market.[14] Still others argue that employers should take up the task of retraining employees, with benefits for employers including ensuring an adequate supply of skilled labor, reducing hiring costs, and increasing employee loyalty, morale, and productivity.[15] One subset of this approach are partnerships between employers and labor unions, such as that between Microsoft Corp. and the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO).[16] Announced in December of 2023, the partnership lists its goals as (1) sharing information about AI trends with unions and workers, (2) integrating worker feedback into AI development, and 3) influencing public policy in support of affected workers.

Others point to the need for strong worker organizations that are capable of bargaining about and achieving protections related to AI and other technology in the workplace.

Collective Bargaining

The Economic Policy Institute, a think-tank aligned with labor unions, argues that the “best ‘AI policy’ that [policymakers] can provide is boosting workers’ power by improving social insurance systems, removing barriers to organizing unions, and sustaining lower rates of unemployment.”[17] Union officials agree on the importance of unions protecting their members from technological displacements, and have started pushing for “requirements that companies must notify and negotiate with worker representatives before deploying new automation technologies.”[18]

The above-mentioned partnership between the AFL-CIO and Microsoft includes a “neutrality framework” which “confirms a joint commitment to respect the right of employees to form or join unions, to develop positive and cooperative labor-management relationships, and to negotiate collective bargaining agreements that will support workers in an era of rapid technological change.”[19] Ideally, this means that Microsoft would not attempt to dissuade any employees that try to unionize, including through common “union avoidance” measures.[20] Employer neutrality can provide more favorable conditions for unionizing, which provides a formal mechanism for workers to collectively bargain for technology policies calibrated to their particular industry and tasks.

Unfortunately, achieving these measures, whether through legislation or Collective Bargaining Agreements (CBAs), will likely require applying tremendous pressure on employers.

For example, in 2023, the Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA) union and the Writers Guild of America (WGA) simultaneously went on strike for the first time in sixty years.[21] One of the main demands for both unions was protections against AI use. Both achieved partial concessions after 118 days and 148 days out on strike, respectively.[22]

SAG-AFTRA and WGA enjoyed considerable leverage that other workers likely will not have. As Politico reported, Hollywood serves as a “key base for wealthy Democratic donors” which is especially important in California, where much of the industry is based.[23] Entertainment workers occupy an important place in many of our daily lives and support an economically important industry.[24] Unlike healthcare workers or state employees, withholding their labor cannot be portrayed as dangerous, a characterization that seeks to undermine public support for some striking workers.[25]

The resolve and strategic action of both unions charts a path for other unions to ensure worker input into the use of technology in the workplace, while revealing how difficult this path will be.

Conclusion

Although the exact effects of increased AI-adoption by employers are still unknown, there are clear reasons to take their potential effects on workers seriously, today. Workers across the income spectrum are already feeling the pressure of job losses, job displacements, the need to retrain for a new job, and the economic and emotional stress these cause. Bolstering retraining programs, whether run by the government, employers, or through joint efforts are a step towards meeting the demands of tomorrow. However, to truly assuage employee fears of displacement, workers must have meaningful input into their working conditions, including the introduction of new technology to their workplace. Unions hold an important role in achieving this goal.

 

 

Notes:

[1] Chia-Chia Chang et al., The Role of Technological Job Displacement in the Future of Work, CDC’s NIOSH Science Blog (Feb. 15, 2022), https://blogs.cdc.gov/niosh-science-blog/2022/02/15/tjd-fow/.

[2] See e.g., Jack Kelly, Goldman Sachs Predicts 300 Million Jobs Will be Lost or Degraded by Artificial Intelligence, Forbes (Mar. 31, 2023), https://www.forbes.com/sites/jackkelly/2023/03/31/goldman-sachs-predicts-300-million-jobs-will-be-lost-or-degraded-by-artificial-intelligence/; G Krishna Kumar, AI-led Job Loss is Real, Govt Must Intervene, Deccan Herald (July 21, 2024), https://www.deccanherald.com/opinion/ai-led-job-loss-is-real-govt-must-intervene-3115077.

[3] Kelly, supra note 2.

[4] Ian Shine & Kate Whiting, These Are the Jobs Most Likely to be Lost – And Created – Because of AI, World Economic Forum (May 4, 2023), https://www.weforum.org/stories/2023/05/jobs-lost-created-ai-gpt/.

[5] Kelly, supra note 2.

[6] See e.g., Peter Dizikes, Does Technology Help or Hurt Employment?, MIT News (Apr. 1, 2024), https://news.mit.edu/2024/does-technology-help-or-hurt-employment-0401.

[7] See e.g., Hillary Hoffower, Financial Stress is Making Us Mentally and Physically Ill. Here’s How to Cope, Fortune (May 10, 2024), https://fortune.com/well/article/financial-stress-mental-health-physical-illness/; Majority of Americans Feeling Financially Stressed and Living Paycheck to Paycheck According to CNBC Your Money Survey, CNBC News Releases (Sept. 7, 2023), https://www.cnbc.com/2023/09/07/majority-of-americans-feeling-financially-stressed-and-living-paycheck-to-paycheck-according-to-cnbc-your-money-survey.html.

[8] Chang et al., supra note 1.

[9] Id.

[10] See e.g., Chris Marr, AI Poses Job Threats While State Lawmakers Move With Caution, Bloomberg Law (Aug. 13, 2024), https://news.bloomberglaw.com/daily-labor-report/ai-poses-job-threats-while-state-lawmakers-move-with-caution.

[11] Sanam Hooshidary et al., Artificial Intelligence in the Workplace: The Federal and State Legislative Landscape, National Conference of State Legislatures (updated Oct. 23, 2024), https://www.ncsl.org/state-federal/artificial-intelligence-in-the-workplace-the-federal-and-state-legislative-landscape.

[12] Kaela Roeder, High School Seniors in Maryland Are Getting Daily AI Training, Technical.ly (Nov. 8, 2024), https://technical.ly/workforce-development/high-school-ai-training-howard-county-maryland/; Maryland to Offer Free AI Training to State Employees, Government Technology (Sept. 25, 2024), https://www.govtech.com/artificial-intelligence/maryland-to-offer-free-ai-training-to-state-employees; Marr, supra note 10 (“A coalition of major tech companies is urging state lawmakers to focus their efforts on retraining workers for newly emerging jobs in the industry.”).

[13] Marr, supra note 10.

[14] Rachel Curry, Recent Data Shows AI Job Losses Are Rising, But the Numbers Don’t Tell the Full Story, CNBC (Dec. 16, 2023), https://www.cnbc.com/2023/12/16/ai-job-losses-are-rising-but-the-numbers-dont-tell-the-full-story.html.

[15] See John Hall, Why Upskilling and Reskilling Are Essential in 2023, Forbes (Feb. 24, 2023), https://www.forbes.com/sites/johnhall/2023/02/24/why-upskilling-and-reskilling-are-essential-in-2023/; The 2020s Will be a Decade of Upskilling. Employers Should Take Notice, World Economic Forum (Jan. 10, 2024), https://www.weforum.org/stories/2024/01/the-2020s-will-be-a-decade-of-upskilling-employers-should-take-notice/.

[16] Press Release, AFL-CIO and Microsoft Announce New Tech-Labor Partnership on AI and the Future of the Workforce, AFL-CIO (Dec. 11, 2023), https://aflcio.org/press/releases/afl-cio-and-microsoft-announce-new-tech-labor-partnership-ai-and-future-workforce.

[17] Josh Bivens & Ben Zipperer, Unbalanced Labor Market Power is What Makes Technologu–Including AI–Threatening to Workers, Economic Policy Institute (Mar. 28, 2024), https://www.epi.org/publication/ai-unbalanced-labor-markets/.

[18] Marr, supra note 10.

[19] Press Release, supra note 16.

[20] See e.g., Roy E. Bahat & Thomas A. Kochan, How Businesses Should (and Shouldn’t) Respond to Union Organizing, Harvard Business Review (Jan. 6, 2023), https://hbr.org/2023/01/how-businesses-should-and-shouldnt-respond-to-union-organizing; Ben Bodzy, Best Practices for Union Avoidance, Baker Donelson (last visited Nov. 18, 2024), https://www.bakerdonelson.com/files/Uploads/Documents/Breakfast_Briefing_11-17-11_Union_Avoidance.pdf; Carta H. Robison, Steps for Employers to Preserve a Union Free Workplace, Barett McNagny (last visited Nov. 18, 2024), https://www.barrettlaw.com/blog/labor-and-employment-law/union-avoidance-steps-for-employers.

[21] Chelsey Sanchez, Everything to Know About the SAG Strike That Shut Down Hollywood, Harpers Bazaar (Nov. 9, 2023), https://www.harpersbazaar.com/culture/politics/a44506329/sag-aftra-actors-strike-hollywood-explained/#what-is-sag-aftra.

[22] Jake Coyle, In Hollywood Writers’ Battle Against AI, Humans Win (For Now), AP News (Sept. 27, 2023), https://apnews.com/article/hollywood-ai-strike-wga-artificial-intelligence-39ab72582c3a15f77510c9c30a45ffc8; Bryan Alexander, SAG-AFTRA President Fran Drescher: AI Protection Was A ‘Deal Breaker’ In Actors Strike, USA Today (Nov. 10, 2023), https://www.usatoday.com/story/entertainment/tv/2023/11/10/sag-aftra-deal-ai-safeguards/71535785007/.

[23] Lara Korte & Jeremy B. White, Newsom Signs Laws to Protect Hollywood from Fake AI Actors, Politico (Sept. 17, 2024), https://www.politico.com/news/2024/09/17/newsom-signs-law-hollywood-ai-actors-00179553; Party Control of California State Government, Ballotpedia, https://ballotpedia.org/Party_control_of_California_state_government (last visited Nov. 18, 2024).

[24] Advocacy: Driving Local Economies, Motion Picture Ass’n, https://www.motionpictures.org/advocacy/driving-local-economies/ (last visited Jan. 17, 2025).

[25] See, e.g., Ryan Essex & Sharon Marie Weldon, The Justification For Strike Action In Healthcare: A Systematic Critical Interpretive Synthesis, 29:5 Nursing Ethics 1152 (2022) https://doi.org/10.1177/09697330211022411; Nina Chamlou, How Nursing Strikes Impact Patient Care, NurseJournal (Oct. 10, 2023), https://nursejournal.org/articles/how-nursing-strikes-impact-patient-care/.

DNR Regulations Could Help Ensure Availability of Walleye for Future Minnesotans

December 2, 2024
Administrative Law, Environmental Law

Elizabeth Thilges, MJLST Staffer

 

The Minnesota Department of Natural Resources (“DNR”) recently announced that it plans to amend its fishing regulations to lower the number of walleye that can be taken and possessed per day from six to four walleye.[1] If the DNR does promulgate a rule lowering the daily taking and possession limits, it would be a step in the right direction towards ensuring that walleye are available for future generations of Minnesotans.

Lower Taking and Possession Limits Are Necessary Due to the Spread of Zebra Mussels.

Walleye are a North American species of freshwater fish sought after by both commercial and recreational fishers.[2] However, angling activity and the presence of invasive zebra mussels are both linked to decreases in walleye populations.[3] Zebra mussels cause increased water clarity because they are filter feeders.[4] Walleye retinal structures are adapted to lower light conditions, so an increase in water clarity decreases the availability of their preferred habitat.[5] A study of Mille Lacs, a popular lake for walleye fishing in Minnesota, found the introduction of zebra mussels, along with other sources of increased water clarity, to be connected to a decline in the walleye population.[6] While the DNR has made efforts to control zebra mussels, they have unfortunately continued to spread and harm ecosystems across Minnesota.[7] As complete eradication of zebra mussels is not yet achievable, the DNR’s plan to lower the daily bag limit would mitigate at least one strain on walleye populations.

The DNR Should Also Clarify Size Limits for Walleye in its Regulations.

The Minnesota Constitution provides that “fishing and the taking of … fish [is] a valued part of our heritage that shall be forever preserved for the people and shall be managed by law and regulation for the public good.”[8] This provision has been interpreted by Minnesota courts as “recogniz[ing] the ‘need for effective regulation to protect the viability of our state’s fish and game resources.’”[9] The Minnesota Game and Fish Laws puts this provision of the Minnesota Constitution into effect by providing a general requirement that “[u]nless otherwise provided in this chapter, the commissioner [of natural resources] shall, by rule, prescribe the limits on the number of each species of fish that may be taken in one day and the number that may be possessed.”[10] In addition, Section 97C.401(2) provides a specific limit on the possession of walleye, requiring that “[a] person may have no more than one walleye larger than 20 inches in possession.”[11]

DNR fishing regulations set the “[d]aily and [p]ossession [l]imits” for walleye at “6 in aggregate” for inland waters, unless the waters  “are subject to experimental or special regulations or are closed for taking and possessing fish.”[12] Section 97C.401(2) leaves the DNR with the discretion to set these limits on the daily taking and possession of walleye, as it can be interpreted as not specifying a limit on possession of walleye smaller than 20 inches.[13] While Section 97C.401(2) could alternatively be read as only allowing possession of one walleye larger than 20 inches, and no walleye smaller than 20 inches, Minnesota courts would likely defer to the DNR’s interpretation if the statute is ambiguous and the DNR’s interpretation is reasonable.[14] Additionally, possessing and taking fish have different definitions. The Game and Fish Laws define “possession” as “both actual and constructive possession and control of the things referred to,” while “taking” is defined as “pursuing, shooting, killing, capturing, trapping, snaring, angling, spearing, or netting wild animals, or placing, setting, drawing, or using a net, trap, or other device to take wild animals.”[15] A person could take six walleye in a day but only possess one if that person releases the fish before taking another. However, while DNR regulations set size limits for other fish species, they do not set one for walleye.[16] If the DNR amends its regulations to lower the daily limit to four walleye, it also has the opportunity to amend its regulations to clarify that only one walleye in possession can be larger than 20 inches, as required by Section 97C.401(2). This amendment is necessitated both by existing statute and by the spread of zebra mussels in Minnesota waters.

 

Notes

[1] Tony Kennedy, DNR Says Minnesota’s Longtime 6-Walleye Limit is Headed for Extinction, Minn. Star Trib. (Nov. 7, 2024), https://www.startribune.com/dnr-says-minnesotas-sacred-6-walleye-limit-is-headed-for-extinction/601177553.

[2] Lee F. G. Gutowsky et al., Quantifying Multiple Pressure Interactions Affecting Populations of a Recreationally and Commercially Important Freshwater Fish, 25 Glob. Change Biology 1049, 1050 (2019).

[3] Id. at 1055-56.

[4] Gutowsky et al. at 1057; Gretchen J. A. Hansen et al., Water Clarity and Temperature Effects on Walleye Safe Harvest: An Empirical Test of the Safe Operating Space Concept, Ecosphere, March 2019, at 1, 9.

[5] Gutowsky et al. at 1057; Hansen et al. at 2.

[6] Hansen et al. at 9.

[7] See Experimental Control of Zebra Mussels in Minnesota, Minn. Dep’t of Nat. Res. (last visited Nov. 23, 2024), https://www.dnr.state.mn.us/invasives/aquaticanimals/zebramussel/zebra-mussel-pilot-project.html; Michael A. McCartney & Sophie Mallez, The Role of Waterway Connections and Downstream Drift of Veliger Larvae in the Expanding Invasion of Inland Lakes by Zebra Mussels in Minnesota, USA, 13 Aquatic Invasions 393, 394 (2018).

[8] Minn. Const., Art. XIII, § 12.

[9] Save Mille Lacs Sportsfishing, Inc. v. Minn. Dep’t of Nat. Res., 859 N.W.2d 845, 849 (Minn. Ct. App. 2015) (quoting State v. Colosimo, 669 N.W.2d 1, 6 (Minn. 2003)).

[10] Minn. Stat. § 97C.401(1).

[11] “This subdivision does not apply to boundary waters.” Minn. Stat. §  97C.401(2).

[12] Minn. R. § 6262.0200(1)(F) (2024).

[13] Minn. Stat. §  97C.401(2).

[14] In re Reichmann Land & Cattle, LLP, 867 N.W.2d 502, 506 (Minn. 2015).

[15] Minn. Stat. § 97A.015(36), (47).

[16] See Minn. R. § 6262.0200 (2024).

The Power of Preference or Monopoly? Unpacking Google’s Search Engine Domination

November 26, 2024
Administrative Law, Business Law, Data, Ethics, Industry, Internet, Trade, Trusts and Estates

Donovan Ennevor, MJLST Staffer

When searching for an answer to a query online, would you ever use a different search engine than Google? The answer for most people is almost certainly no. Google’s search engine has achieved such market domination that “to Google” has become a verb in the English language.[1] Google controls 90% of the U.S. search engine market, with its closest competitors Yahoo and Bing holding around 3% each.[2] Is this simply because Google offers a superior product or is there some other more nefarious reason?

According to the Department of Justice (“DOJ”), the answer is the latter: Google has dominated its competitors by engaging in illegal practices and creating a monopoly. Federal Judge Amit Mehta agreed with the DOJ’s position and ruled in August 2024 that Google’s market domination was a monopoly achieved through improper means.[3] The remedies for Google’s breach of antitrust law are yet to be determined; however, their consequences could have far reaching implications for the future of Google and Big Tech.

United States v. Google LLC

In October 2020, the DOJ and 11 states filed a civil suit against Google in the U.S. District Court for the District of Columbia, alleging violations of U.S. antitrust laws.[4] A coalition of 35 states, Guam, Puerto Rico, and Washington D.C. filed a similar lawsuit in December 2020.[5] In 2021, the cases were consolidated into a single proceeding to address the overlapping claims.[6] An antitrust case of this magnitude had not been brought in nearly two decades.[7]

The petitioners’ complaint argued that Google’s dominance did not solely arise through superior technology, but rather, through exclusionary agreements designed to stifle competition in online search engine and search advertising markets.[8] The complaint alleged that Google maintained its monopolies by engaging in practices such as entering into exclusivity agreements that prohibited the preinstallation of competitors’ search engines, forcing preinstallation of Google’s search engine in prime mobile device locations, and making it undeletable regardless of consumer preference.[9] For example, Google’s agreement with Apple required that all Apple products and tools have Google as the preinstalled default—essentially an exclusive—search engine.[10] Google also allegedly used its monopoly profits to fund the payments to secure preferential treatment on devices, web browsers, and other search access points, creating a self-reinforcing cycle of monopolization.[11]

According to the petitioners, these practices not only limited competitor opportunities, but also harmed consumers by reducing search engine options and diminishing quality, particularly in areas like privacy and data use.[12] Furthermore, Google’s dominance in search advertising has allowed it to charge higher prices, impacting advertisers and lowering service quality—outcomes unlikely in a more competitive market.[13]

Google rebutted the petitioners’ argument, asserting instead that its search product is preferred due to its superiority and is freely chosen by its consumers.[14] Google also noted that if users wish to switch to a different search engine, they can do so easily.[15]

However, Judge Mehta agreed with the arguments posed by the petitioners and held Google’s market dominance in search and search advertising constituted a monopoly, achieved through exclusionary practices violating U.S. antitrust laws.[16] The case will now move to the remedy determination phase, where the DOJ and Google will argue what remedies are appropriate to impose on Google during a hearing in April 2025.[17]

The Proposed Remedies and Implications

In November, the petitioners filed their final proposed remedies—both behavioral and structural—for Google with the court.[18] Behavioral remedies govern a company’s conduct whereas structural remedies generally refer to reorganization and or divestment.[19]  The proposed behavioral remedies include barring Google from entering exclusive preinstallation agreements and requiring Google to license certain indexes, data, and models that drive its search engine.[20] These remedies would help create more opportunities for competing search engines to gain visibility and improve their search capabilities and ad services. The petitioner’s filing mentioned they would also pursue structural remedies including forcing Google to breakup or divest from its Chrome browser and Android mobile operating system.[21] To ensure Google adheres to these changes, the petitioners proposed appointing a court-monitored technical committee to oversee Google’s compliance.[22]

It could be many years before any of the proposed remedies are actually instituted, given that Google has indicated it will appeal Judge Mehta’s ruling.[23] Additionally, given precedent it is unlikely that any structural remedies will be imposed or enforced.[24] However, any remedies ultimately approved would set a precedent for regulatory control over Big Tech, signaling that the U.S. government is willing to take strong steps to curb monopolistic practices. This could encourage further action against other tech giants and redefine regulatory expectations across the industry, particularly around data transparency and competition in digital advertising.

 

Notes

[1] See Virginia Heffernan, Just Google It: A Short History of a Newfound Verb, Wired (Nov. 15, 2017, 7:00 AM), https://www.wired.com/story/just-google-it-a-short-history-of-a-newfound-verb/.

[2] Justice Department Calls for Sanctions Against Google in Landmark Antitrust Case, Nat’l Pub. Radio, (Oct. 9, 2024, 12:38 AM), https://www.npr.org/2024/10/09/nx-s1-5146006/justice-department-sanctions-google-search-engine-lawsuit [hereinafter Calls for Sanctions Against Google].

[3] United States v. Google LLC, 2024 WL 3647498, 1, 134 (2024).

[4] Justice Department Sues Monopolist Google For Violating Antitrust Laws, U.S. Dep’t of Just. (Oct. 20, 2020), https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws [hereinafter Justice Department Calls for Sanctions].

[5] Dara Kerr, United States Takes on Google in Biggest Tech Monopoly Trial of 21st Century, Nat’l Pub. Radio, (Sept. 12, 2023, 5:00 AM), https://www.npr.org/2023/09/12/1198558372/doj-google-monopoly-antitrust-trial-search-engine.

[6] Tracker Detail US v. Google LLC / State of Colorado v. Google LLC, TechPolicy.Press, https://www.techpolicy.press/tracker/us-v-google-llc/ (last visited Nov. 20, 2024).

[7] Calls for Sanctions Against Google, supra note 2 (“The last antitrust case of this magnitude to make it to trial was in 1998, when the Justice Department sued Microsoft.”).

[8] Justice Department Calls for Sanctions, supra note 4.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Kerrr, supra note 5.

[15] Id.

[16] United States v. Google LLC, 2024 WL 3647498, 1, 4 (2024).

[17] Calls for Sanctions Against Google, supra note 2.

[18] Steve Brachmann, DOJ, State AGs File Proposed Remedial Framework in Google Search Antitrust Case, (Oct. 13, 2024, 12:15 PM), https://ipwatchdog.com/2024/10/13/doj-state-ags-file-proposed-remedial-framework-google-search-antitrust-case/id=182031/.

[19] Dan Robinson, Uncle Sam may force Google to sell Chrome browser, or Android OS, The Reg. (Oct. 9, 2024, 12:56 pm), https://www.theregister.com/2024/10/09/usa_vs_google_proposed_remedies/.

[20] Brachmann, supra note 18.

[21] Exec. Summary of Plaintiff’s Proposed Final Judgement at 3–4, United States v. Google LLC No. 1:20-cv-03010-APM (D.D.C. Nov. 20, 2024). Id at 4.

[22] Id.

[23] See Jane Wolfe & Miles Kruppa, Google Loses Antitrust Case Over Search-Engine Dominance, Wall Street J. (Aug. 5, 2024, 5:02 pm), https://www.wsj.com/tech/google-loses-federal-antitrust-case-27810c43?mod=article_inline.

[24] See Makenzie Holland, Google Breakup Unlikely in Event of Guilty Verdict, Tech Target (Oct. 11, 2023), https://www.techtarget.com/searchcio/news/366555177/Google-breakup-unlikely-in-event-of-guilty-verdict. See also Michael Brick, U.S. Appeals Court Overturns Microsoft Antitrust Ruling, N.Y. Times (Jun 28, 2001), https://www.nytimes.com/2001/06/28/business/us-appeals-court-overturns-microsoft-antitrust-ruling.html. (summarizing the U.S. Court of Appeals decision overturning of the structural remedies imposed on Microsoft in an antitrust case).

 

 

Privacy at Risk: Analyzing DHS AI Surveillance Investments

November 22, 2024
Administrative Law, Artificial Intelligence, Constitutional Law, Forensics, Law Enforcement, Public Safety

Noah Miller, MJLST Staffer

The concept of widespread surveillance of public areas monitored by artificial intelligence (“AI”) may sound like it comes right out of a dystopian novel, but key investments by the Department of Homeland Security (“DHS”) could make this a reality. Under the Biden Administration, the U.S. has acted quickly and strategically to adopt artificial intelligence as a tool to realize national security objectives.[1] In furtherance of President Biden’s executive goals concerning AI, the Department of Homeland Security has been making investments in surveillance systems that utilize AI algorithms.

Despite the substantial interest in protecting national security, Patrick Toomey, deputy director of the ACLU National Security Project, has criticized the Biden administration for allowing national security agencies to “police themselves as they increasingly subject people in the United States to powerful new technologies.”[2] Notably, these investments have not been tailored towards high-security locations—like airports. Instead, these investments include surveillance in “soft targets”—high-traffic areas with limited security: “Examples include shopping areas, transit facilities, and open-air tourist attractions.”[3] Currently, due to the number of people required to review footage, surveilling most public areas is infeasible; however, emerging AI algorithms would allow for this work to be done automatically. While enhancing security protections in soft targets is a noble and possibly desirable initiative, the potential privacy ramifications of widespread autonomous AI surveillance are extreme. Current Fourth Amendment jurisprudence offers little resistance to this form of surveillance, and the DHS has both been developing this surveillance technology themselves and outsourcing these projects to private corporations.

To foster innovation to combat threats to soft targets, the DHS has created a center called Soft Target Engineering to Neutralize the Threat Reality (“SENTRY”).[4] Of the research areas at SENTRY, one area includes developing “real-time management of threat detection and mitigation.”[5] One project, in this research area, seeks to create AI algorithms that can detect threats in public and crowded areas.[6] Once the algorithm has detected a threat, the particular incident would be sent to a human for confirmation.[7] This would be a substantially more efficient form of surveillance than is currently widely available.

Along with the research conducted through SENTRY, DHS has been making investments in private companies to develop AI surveillance technologies through the Silicon Valley Innovation Program (“SVIP”).[8] Through the SVIP, the DHS has awarded three companies with funding to develop AI surveillance technologies that can detect “anomalous events via video feeds” to improve security in soft targets: Flux Tensor, Lauretta AI, and Analytical AI.[9] First, Flux Tensor currently has demo pilot-ready prototype video feeds that apply “flexible object detection algorithms” to track and pinpoint movements of interest.[10] The technology is used to distinguish human movements and actions from the environment—i.e. weather, glare, and camera movements.[11] Second, Lauretta AI is adjusting their established activity recognition AI to utilize “multiple data points per subject to minimize false alerts.”[12] The technology generates automated reports periodically of detected incidents that are categorized by their relative severity.[13] Third, Analytical AI is in the proof of concept demo phase with AI algorithms that can autonomously track objects in relation to people within a perimeter.[14] The company has already created algorithms that can screen for prohibited items and “on-person threats” (i.e. weapons).[15] All of these technologies are currently in early stages, so the DHS is unlikely to utilize these technologies in the imminent future.

Assuming these AI algorithms are effective and come to fruition, current Fourth Amendment protections seem insufficient to protect against rampant usage of AI surveillance in public areas. In Kyllo v. United States, the Court placed an important limit on law enforcement use of new technologies. The Court held that when new sense-enhancing technology, not in general public use, was utilized to obtain information from a constitutionally protected area, the use of the new technology constitutes a search.[16] Unlike in Kyllo, where the police used thermal imaging to obtain temperature levels on various areas of a house, people subject to AI surveillance in public areas would not be in constitutionally protected areas.[17] Being that people subject to this surveillance would be in public places, they would not have a reasonable expectation of privacy in their movements; therefore, this form of surveillance likely would not constitute a search under prominent Fourth Amendment search analysis.[18]

While the scope and accuracy of this new technology are still to be determined, policymakers and agencies need to implement proper safeguards and proceed cautiously. In the best scenario, this technology can keep citizens safe while mitigating the impact on the public’s privacy interests. In the worst scenario, this technology could effectively turn our public spaces into security checkpoints. Regardless of how relevant actors proceed, this new technology would likely result in at least some decline in the public’s privacy interests. Policymakers should not make a Faustian bargain for the sake of maintaining social order.

 

Notes

[1] See generally Joseph R. Biden Jr., Memorandum on Advancing the United States’ Leadership in Artificial Intelligence; Harnessing Artificial Intelligence to Fulfill National Security Objectives; and Fostering the Safety, Security, and Trustworthiness of Artificial Intelligence, The White House (Oct. 24, 2024), https://www.whitehouse.gov/briefing-room/presidential-actions/2024/10/24/memorandum-on-advancing-the-united-states-leadership-in-artificial-intelligence-harnessing-artificial-intelligence-to-fulfill-national-security-objectives-and-fostering-the-safety-security/ (explaining how the executive branch intends to utilize artificial intelligence in relation to national security).

[2] ACLU Warns that Biden-Harris Administration Rules on AI in National Security Lack Key Protections, ACLU (Oct. 24, 2024, 12:00 PM), https://www.aclu.org/press-releases/aclu-warns-that-biden-harris-administration-rules-on-ai-in-national-security-lack-key-protections.

[3] Jay Stanley, DHS Focus on “Soft Targets” Risks Out-of-Control Surveillance, ALCU (Oct. 24, 2024), https://www.aclu.org/news/privacy-technology/dhs-focus-on-soft-targets-risks-out-of-control-surveillance.

[4] See Overview, SENTRY, https://sentry.northeastern.edu/overview/#VSF.

[5] Real-Time Management of Threat Detection and Mitigation, SENTRY, https://sentry.northeastern.edu/research/ real-time-threat-detection-and-mitigation/.

[6] See An Artificial Intelligence-Driven Threat Detection and Real-Time Visualization System in Crowded Places, SENTRY, https://sentry.northeastern.edu/research-project/an-artificial-intelligence-driven-threat-detection-and-real-time-visualization-system-in-crowded-places/.

[7] See Id.

[8] See, e.g., SVIP Portfolio and Performers, DHS, https://www.dhs.gov/science-and-technology/svip-portfolio.

[9] Id.

[10] See Securing Soft Targets, DHS, https://www.dhs.gov/science-and-technology/securing-soft-targets.

[11] See pFlux Technology, Flux Tensor, https://fluxtensor.com/technology/.

[12] See Securing Soft Targets, supra note 10.

[13] See Security, Lauretta AI, https://lauretta.io/technologies/security/.

[14] See Securing Soft Targets, supra note 10.

[15] See Technology, Analytical AI, https://www.analyticalai.com/technology.

[16] Kyllo v. United States, 533 U.S. 27, 33 (2001).

[17] Cf. Id.

[18] See generally, Katz v. United States, 389 U.S. 347, 361 (1967) (Harlan, J., concurring) (explaining the test for whether someone may rely on an expectation of privacy).

 

 

The Introduction of “Buy Now, Pay Later” Products

November 20, 2024
Administrative Law, Business Law

Yanan Tang, MJLST Staffer

As of June 2024, it is estimated that more than half of Americans turn to Buy Now, Pay Later (“BNPL”) options to purchase products during financially stressful times. [1] BNPL allows customers to split up the payment of their purchases into four equal payments, requiring a down payment of 25 percent, with the remaining cost covered by three periodic payment installments. [2]

 

Consumer Financial Protection Bureau’s Interpretive Rules

In response to the popularity of BNPL products, the Consumer Financial Protection Bureau (“CFPB”) took action to regulate BNPL products.[3] In issuing its interpretive rules for BNPL, the CFPB aims to outline how these products fit within existing credit regulations. The CFPB’s interpretive rules for BNPL products were introduced in May 2024, following a 60-day review period with mixed feedback. The rules became effective in July, aiming to apply credit card-like consumer protections to BNPL services under the Truth in Lending Act (“TILA”).

Specifically, the interpretive rules assert that these BNPL providers meet the criteria for being “card issuers” and “creditors”, and therefore should be subject to relevant regulations of TILA, which govern credit card disputes and refund rights.[4] Under CFPB’s interpretive rules, BNPL firms are required to investigate disputes, refund returned products or voided services, and provide billing statements.[5]

This blog will first explain the distinction between interpretive rules and notice-and-comment rulemaking to contextualize the CFPB’s regulatory approach. It will then explore the key consumer protections these rules aim to enforce and examine the mixed responses from various stakeholders. Finally, it will analyze the Financial Technology Association’s lawsuit challenging the CFPB’s rules and consider the broader implications for BNPL regulation.

 

Interpretive Rules and Notice-and-Comment Rulemaking Explained

In general, interpretive rules are non-binding and do not require public input, while notice-and-comment rules are binding with the force of law and must follow a formal process, including public feedback, as outlined in the Administrative Procedural Act (“APA”) §553.[6] The “legal effect test” from American Mining Congress v. MSHA helps determine whether a rule is interpretive or legislative by examining factors like legislative authority, the need for a legal basis for enforcement, and whether the rule amends an existing law.[7] While some courts vary in factors to distinguish legislative and interpretive rules, they generally agree that agencies cannot hide real regulations in interpretive rules.

 

Comments Received from Consumer Groups, Traditional Banks, and BNPL Providers

After soliciting comments, CFPB received conflicting feedback on the proposed interpretive rules.[8] However, they also urged the agency to take further action to protect consumers who use BNPL credit.[9] In addition, traditional banks largely supported the rule, because BNPL’s digital user accounts are similar to those of credit cards and should be regulated similarly.[10] In contrast, major BNPL providers protested against CFPB’s rule.[11] Many BNPL providers, like PayPal, raised concerns about administrative procedures and urged CFPB to proceed through notice-and-comment rulemaking.[12] In sum, the conflicting comments highlight the challenge of applying traditional credit regulations to innovative financial products, leading to broader disputes about the rule’s implementation.

 

Financial Technology Association’s Lawsuit against CFPB’s New Rules

After the interpretive rules went into effect in July, FTA filed a lawsuit against the agency to stop the interpretive rule.[13] In their complaint, FTA contends that CFPB bypassed APA’s notice-and-comment rulemaking process, despite the significant change imposed by the rule.[14] FTA argues that the agency exceeded statutory authority under the Truth in Lending Act (TILA) as the act’s definition of “credit card” does not apply to BNPL products.[15] FTA also argues that the rule is arbitrary and capricious because it fails to account for the unique structure of BNPL products and their compliance challenges with Regulation Z.[16]

The ongoing case between FTA and CFPB will likely focus on whether CFPB’s rule is a permissible interpretation of existing law or a substantive rule requiring formal rulemaking under APA § 553. This decision should weigh the nature of BNPL products in relation to consumer protections traditionally associated with credit card-like products. In defending the agency’s interpretive rules against FTA, CFPB could consider highlighting the legislative intent of TILA’s flexibility and rationale for using an interpretive rule.

 

Notes

[1] See Block, Inc., More than Half of Americans Turn to Buy Now, Pay Later During Financially Stressful Times (June 26, 2024), https://investors.block.xyz/investor-news/default.aspx.

[2] Id.

[3] See Paige Smith & Paulina Cachero, Buy Now, Pay Later Needs Credit Card-Like Oversight, CFPB Says, Bloomberg Law (May 22, 2024), https://news.bloomberglaw.com/banking-law/buy-now-pay-later-soon-will-be-treated-more-like-credit-cards.

[4] Id.

[5] Id.

[6] 5 U.S.C.A. § 553.

[7] Am. Mining Cong. v. Mine Safety & Health Admin., 302 U.S. App. D.C. 38, 995 F.2d 1106 (1993).

[8] See Evan Weinberger, CFPB’s ‘Buy Now, Pay Later’ Rule Sparks Conflicting Reactions, Bloomberg Law (Aug. 1, 2024), https://news.bloomberglaw.com/banking-law/cfpbs-buy-now-pay-later-rule-sparks-conflicting-reactions.

[9] See New York City Dep’t of Consumer & Worker Prot., Comment Letter on Truth in Lending (Regulation Z); Use of Digital User Accounts To Access Buy Now, Pay Later Loans, Docket No. CFPB-2024-0017 (Aug. 31, 2024), https://www.regulations.gov/comment/CFPB-2024-0017-0027; see also Nat’l Consumer L. Ctr., Comment Letter on Truth in Lending (Regulation Z); Use of Digital User Accounts To Access Buy Now, Pay Later Loans, Docket No. CFPB-2024-0017, at 1 (Aug. 1, 2024), https://www.regulations.gov/comment/CFPB-2024-0017-0028.

[10] See Independent Community Bankers of Am., Comment Letter on Truth in Lending (Regulation Z); Use of Digital User Accounts To Access Buy Now, Pay Later Loans, Docket No. CFPB-2024-0017 (July 31, 2024), https://www.regulations.gov/comment/CFPB-2024-0017-0023.

[11] See Financial Technology Ass’n, Comment Letter on Truth in Lending (Regulation Z); Use of Digital User Accounts To Access Buy Now, Pay Later Loans, Docket No. CFPB-2024-0017 (July 19, 2024). https://www.regulations.gov/comment/CFPB-2024-0017-0038.

[12] See PayPal, Inc., Comment Letter on Truth in Lending (Regulation Z); Use of Digital User Accounts To Access Buy Now, Pay Later Loans, Docket No. CFPB-2024-0017 (July 31, 2024). https://www.regulations.gov/comment/CFPB-2024-0017-0025.

[13] See Evan Weinberger, CFPB Buy Now, Pay Later Rule Hit With Fintech Group Lawsuit, Bloomberg Law (Oct. 18, 2024), https://news.bloomberglaw.com/banking-law/cfpbs-buy-now-pay-later-rule-hit-with-fintech-group-lawsuit.

[14] Complaint, Fin. Tech. Ass’n v. Consumer Fin. Prot. Bureau, No. 1:24-cv-02966 (D.D.C. Oct. 18, 2024).

[15] Id.

[16] Id.

What Happens to Your Genetic Data in a Sale or Acquisition?

November 4, 2024
Administrative Law, Data, New Technology, Privacy

Colin Loyd, MJLST Staffer

Remember 23andMe—the genetic testing company that once skyrocketed in publicity in the 2010s due to its relatively inexpensive access to genetic testing? It’s now heading toward disaster. This September, its board of directors saw all but one member tender their resignation.[1] At the close of that day’s trading, 23andMe’s share price was $0.35, representing a 99.9% decline in valuation from its peak in 2021.[2] This decline in valuation suggests the company may declare bankruptcy, which often leads to a sale of a company’s assets. Bankruptcy or the sale of assets present a host of complex privacy and regulatory issues, particularly concerning the sale of 23andMe’s most valuable asset—its vast collection of consumer DNA data.[3] This uncertain situation underscores serious concerns surrounding the state of comprehensive privacy protections for genetic information that leave consumers’ sensitive genetic data vulnerable to misuse and exploitation.

23andMe collects and stores massive amounts of user genetic information. However, unlike healthcare providers, 23andMe does not have to comply with the stringent privacy regulations set out in the Health Insurance Portability and Accountability Act (HIPAA).[4] While HIPAA is designed to protect sensitive health data, its protections apply only to a small subset of healthcare related entities.[5] HIPAA only regulates the use of genetic information by “group health plan[s], health insurance issuer[s] that issue[] health insurance coverage, or issuer[s] of a medicare supplemental policy.”[6] 23andMe does not fit into any of these categories and therefore operates outside the scope of HIPAA protections with respect to genetic information, leaving any genetic information it holds largely unregulated.

The Genetic Information Nondiscrimination Act (GINA), enacted in 2008, offers consumer protections by prohibiting discrimination based on an individual’s genetic information with respect to health insurance premium amounts or eligibility requirements for health insurance.[7] GINA also prohibits any deprivation of employment opportunities based on genetic information.[8] However, GINA’s protections do not extend to life insurance, disability insurance, or long-term care insurance.[9] This leaves a gap where genetic information may be used against individuals by entities not subject to GINA.

This regulatory gap is a major concern for consumers, especially with a potential bankruptcy sale looming. If 23andMe sells its assets, including its database of genetic information, the new owner would not have to adhere to the same privacy commitments made by 23andMe. For example, 23andMe promises not to use genetic information it receives for personalized or targeted marketing/advertising without a user’s express consent.[10] This policy likely reflects 23andMe’s efforts to comply with the California Privacy Rights Act (CPRA), which grants consumers the right to direct a business to not share or sell their personal information.[11] However, this right under the CPRA is an opt-out right—not an opt-in right—meaning consumers can stop a future sale of their information but by default there is no initial, regulatory limit on the sale of their personal information.[12] As a result, there’s nothing stopping 23andMe from altering its policies and changing how it uses genetic information. In fact, 23andMe’s Privacy Statement states it “may make changes to this Privacy Statement from time to time.”[13] Any such change would likely be binding if it is clearly communicated to users.[14] 23andMe currently lists email or an in-app notification as methods it may notify its users of any change to the Privacy Statement.[15] If it does so, it’s highly possible a court would view this as “clear communication” and there would be little legal recourse for users to prevent their genetic information from being used in ways they did not anticipate, such as for research or commercial purposes.

For example, say a life insurance company acquires an individual’s genetic data through the purchase of 23andMe’s assets. It could potentially use that data to make decisions about coverage or premiums, even though GINA prohibits health insurers to do the same.[16] This loophole highlights the dangers of having genetic information in the hands of entities not bound by strict privacy protections.

In the event of an acquisition or bankruptcy, 23andMe’s Privacy Statement outlines that personal information, including genetic data, may be among the assets sold or transferred to the new entity.[17] In such a case, the new owner could inherit both the data and the rights to use it under the existing terms, including the ability to modify how the data is used. This could result in uses not originally intended by the user so long as the change is communicated to the user.[18] This transfer clause highlights a key concern for users because it allows their deeply personal genetic data to be passed to another company without additional consent, potentially subjecting them to exploitation by organizations with different data usage policies or commercial interests. While 23andMe must notify users about any changes to the privacy statement or its use of genetic information, it does not specify whether the notice will be given in advance.[19] Any new entity could plan a change to the privacy statement terms–altering how it uses the genetic information while leaving users in the dark until the change is communicated to them, at which point the user’s information may have already been shared with third parties.

The potential 23andMe bankruptcy and sale of assets reveals deep flaws in the current regulatory system governing genetic data privacy. Without HIPAA protections, consumers risk their sensitive genetic information being sold or misused in ways they cannot control. GINA–while offering some protections–still leaves significant gaps, especially in life and disability insurance. As the demand for genetic testing continues to grow, the vulnerabilities exposed by 23andMe’s potential financial troubles highlight the urgent need for better privacy protections. Consumers must be made aware of the risks involved in sharing their genetic data, and regulatory measures must be strengthened to ensure this sensitive information is not misused or sold without their explicit consent.

 

Notes

[1] Independent Directors of 23andMe Resign from Board, 23andMe (Sept. 17, 2024) https://investors.23andme.com/news-releases/news-release-details/independent-directors-23andme-resign-board.

[2] Rolfe Winkler, 23andMe Board Resigns in New Blow to DNA-Testing Company, WALL ST. J. (Sept. 18, 2024) https://www.wsj.com/tech/biotech/23andme-board-resigns-in-new-blow-to-dna-testing-company-12f1a355.

[3] Anne Wojcicki (the last remaining board member) has consistently publicized her plan to take the company private, which is looming larger given the current state of the business financials. Id.

[4] See 42 U.S.C. § 1320d-9(a)(2).

[5] See generally 42 U.S.C. §1320d et seq.

[6] 42 U.S.C. § 1320d-9(a)(2).

[7] Genetic Information Nondiscrimination Act of 2008, Pub. L. No. 110-233, 122 Stat. 881.

[8] Id.

[9] Jessica D Tenenbaum & Kenneth W Goodman, Beyond the Genetic Information Nondiscrimination Act: Ethical and Economic Implications of the Exclusion of Disability, Long-term Care and Life Insurance, 14 Personalized Med. 153, 154 (2017).

[10] How We Use Your Information, 23andMe, https://www.23andme.com/legal/how-we-use-info/ (last visited Oct. 14, 2024).

[11] Cal. Civ. Code § 1798.120(a) (Deering 2024).

[12] Id.

[13] Privacy Statement, 23andMe (Sept. 24, 2024) https://www.23andme.com/legal/privacy/full-version/.

[14] See Lee v. Ticketmaster LLC, 817 Fed. App’x 393 (9th Cir. 2019)(upholding terms of use where notice was clearly given to the user, even if the user didn’t check a box to assent to the terms).

[15] Privacy Statement, supra note 13.

[16] See K.S.A. § 40-2259(c)-(d) (carving out the ability for life insurance policies to take into account genetic information when underwriting the policy).

[17] Privacy Statement, supra note 13.

[18] See Ticketmaster, 817 Fed. App’x 393 (2019).

[19] Privacy Statement, supra note 13.

Transforming Access: The FCC’s New Telecommunication Requirements May Enhance Accessibility in Criminal Detention Centers

October 29, 2024
Administrative Law, Criminal Law, Disability Law, Human Rights Law, Telecommunication

 

Peyton Soethout, MJLST Staffer

Continued technological advancements have made it easier for people to communicate with their loved ones worldwide. Criminal detention centers have utilized the rise of this digital age to make the inmate communication process easier for their staff.[1] Although these practices may simplify security and administrative protocols, they also negatively impact inmates’ abilities to effectively communicate with loved ones through traditional mail as oftentimes inmates “receive letters with missing pages and blurry images.”[2] These issues—combined with the COVID-19 pandemic increasing security measures, and the prevalence and popularity of telephones—have caused decreases in written communications between incarcerated and free people and subsequent increases in telecommunication.[3]

 

While traditional mail has become less reliable, criminal detention centers’ use of video and audio telecommunications is not without issue. Challenges with telecommunication technology are especially difficult for inmates who have communication disabilities, which include deafness, hard of hearing, blindness, low vision, deafblindness, speech disabilities, or other disabilities that affect communication.[4] Despite technology advancing outside detention facilities, many jails and prisons primarily rely on out-of-date devices for their telecommunication needs.[5] The reliance on out-of-date technology greatly impacts inmates with communication disabilities because they heavily rely on technology to communicate with others.[6]

Congress has attempted to mitigate these challenges through various legislation. Together, the Rehabilitation Act of 1973 and the American Disabilities Act (“ADA”) require prison and jail officers to “avoid discrimination; individually accommodate disability; and maximize integration of prisoners with disabilities with respect to programs, service, and activities.”[7] These statutes provided the first step in equal communication opportunities for all inmates, but they left two questions: (1) who decides which inmates receive communication accommodations; and (2) what specific technologies are required for this communication access.[8]

The Federal Communications Commission (“FCC”) made efforts to address prison telecommunication issues but their attempts were ultimately quashed in 2017 as courts found the FCC only had authority to address interstate calls, not intrastate calls.[9] In 2022, Congress passed the Martha Wright-Reed Just and Reasonable Communications Act (“Martha Wright-Reed Act”) which amended the Communications Act of 1934. It established “any Federal, State, or local law to require telephone service or advanced communications services at a State or local prison, jail, or detention facility.”[10] Because the FCC determined that the Martha Wright-Reed Act “significantly expanded the [FCC’s] jurisdiction over incarcerated people’s communications services,” it promulgated new accessibility requirements for inmate telecommunications.[11]

The new FCC rule requires detention centers to provide text telephones (“TTY”) and telecommunication relay services (“TRS”) to inmates with communication disabilities.[12] TTYs—defined as “machine[s] that [employ] graphic communication in the transmission of coded signals through a wire or radio communication system”—have long been used in jails as a device to assist incarcerated people with communication disabilities, but they have never been explicitly required on a federal level.[13]

Unlike TTYs, the use of TRSs is much more rare. The FCC defines TRSs as “[t]elephone transmission services that provide the ability […] to engage in communication by wire or radio […], in a manner that is functionally equivalent to the ability of a hearing individual who does not have a speech disability.”[14] The new FCC rule also gives examples of certain TRSs such as speech-to-speech relay services (“STS”), and video relay services (“VRS”).[15] Overall, these technologies can significantly decrease challenges presented by general telecommunication devices.[16]

While this rule does an adequate job of addressing what technologies are required for inmate telecommunication access, it does little to address the remaining question: who decides which inmates require telecommunication accommodations. The rule specifies that TTYs and TRSs are for incarcerated people who individually register for communication accommodations, and the rule places registration responsibility primarily on the inmates.[17] Given the historic trend of jail and prison administration, detention facilities’ staff will likely need to organize the registration process and inform inmates of its existence.[18] In the rule proposal, the FCC quotes formerly incarcerated person Kim Thomas who notes, “[i]ncarcerated people with disabilities that impact their ability to communicate continually experience barriers to access because prison administrators fail to understand their communication needs.”[19]

The FCC acknowledges that detention center administrators may lack the knowledge necessary to identify communication needs, and this will likely continue negatively impacting inmates with communication disabilities. Specifically, inmates with communication disabilities may be unaware of the technologies available to them. But even with potential challenges, the FCC’s promulgation of these new requirements is a significant step in the right direction for the future of telecommunication access for inmates with communication disabilities.

 

 

Notes

[1] Nazish Dholakia, The FCC Is Capping Outrageous Prison Phone Rates, but Companies Are Still Price Gouging, Vera (Sept. 4, 2024), https://www.vera.org/news/the-fcc-is-capping-outrageous-prison-phone-rates-but-companies-are-still-price-gouging#:~:text=The (“Corrections departments say they have adopted mail scanning to obtain greater control over materials entering their facilities and ensure safety.”).

[2] Id.

[3] Id.

[4] Tessa Bialek & Margo Schlanger, Effective Communication with Deaf, Hard of Hearing, Blind, and Low Vision Incarcerated People, 26 J. Gender Race & Just. 133, 138 (2023).

[5] Id. (referencing Heyer v. U.S. Bureau of Prisons, 849 F.3d 202 (4th Cir. 2017)).

[6] Id.

[7] Margo Schlanger, Prisoners with Disabilities, in Reforming Criminal Justice: Punishment, Incarceration, and Release 301 (E. Luna ed., 2017).

[8] See Farina Mendelson, A Silent Struggle: Constitutional Violations Against the Hearing Impaired in New York State Prisons, 20 CUNY L. Rev. 559, 564–571 (2017) (noting that the New York Department of Corrections had default responsibility to determine which inmates have disabilities as the ADA did not provide such information); Wanda Bertram, FCC Votes to Slash Prison and Jail Calling Rates and Ban Corporate Kickbacks, Prison Policy Initiative (July 18, 2024), https://www.prisonpolicy.org/blog/2024/07/18/fcc-vote/ (claiming that the July 2024 FCC regulations addressed required accessibility technologies for the first time).

[9] Jon Brodkin, Prison Phone Call Fees Are Out of Control. The FCC Can Finally Rein Them In, Wired (July 19, 2024, 8:30 AM), https://www.wired.com/story/prison-phone-call-fees-fcc-caps/.

[10] Martha Wright-Reed Just and Reasonable Communications Act of 2022, Pub. L. No. 117–338, 136 Stat 6156.

[11] Implementation of the Martha Wright-Reed Act; Rates for Interstate Inmate Calling Services, 89 FR 77244, 77244 [hereinafter FCC Notice and Comment]; Press Release, Fed. Commc’n Comm’n, FCC Caps Exorbitant Phone & Video Call Rates for Incarcerated Persons & Their Families: The Martha Wright-Reed Act Empowered the FCC to Close Gaps in the Long-Fought- For Protections Against Predatory Rates (July 18, 2024).

[12] 47 C.F.R. § 64.6040 (2024).

[13] 47 C.F.R. § 64.601(a)(44) (2024); Bialek & Schlanger, supra note 4 at 142. Note that Bialek & Schlanger use “TTY” to refer to teletypewriters which is one example of a TTY under the FCC’s rule. Oftentimes, teletypewriters and text telephones are used interchangeably. For the purposes of this blog post, TTY will be used as defined in 47 C.F.R. § 64.601.

[14] 47 C.F.R. § 64.601(a)(43) (2024).

[15] See 47 C.F.R. § 64.601(a)(41) (2024), which defines STS as a TRS “that allows individuals with speech disabilities to communicate with voice telephone users through the use of specially trained Communication Assistants who understand the speech patterns of persons with speech disabilities and can repeat the words spoken by that person;” and 47 C.F.R. § 64.601(a)(51) (2024), which defines VRS as “a TRS “that allows people with hearing or speech disabilities who use sign language to communicate with voice telephone users through video equipment.”

[16] See Fed. Commc’n Comm’n, Frequently Asked Questions on Telecommunications Relay Services (TRS), Fed. Commc’n Comm’n, (Mar. 1998), https://transition.fcc.gov/Bureaus/Common_Carrier/FAQ/faq_trs.html (explaining the benefits of TTY and TRS access).

[17] See e.g., 47 C.F.R. § 64.6040(c)(4) (2024) (requiring individual registration); 47 C.F.R. § 64.611 (2024) (explaining the registration process).

[18] See Mendelson, supra note 8, at 564 (“[T]he Department is responsible for identifying an inmate’s hearing impairment.”).

[19] FCC Notice and Comment, supra note 11, at 77248–77249 (emphasis added).

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