iphone – Attorney Evan Brown

March 22, 2024 Antitrust

VIDEO: What is the Apple antitrust lawsuit about?

On March 21, 2024, the U.S. government, 15 states and the District of Columbia filed an antitrust lawsuit against Apple. What is the case about?

The government says Apple built a dominant iPhone ecosystem, driving its high valuation. But Apple faced threats from other products, particularly Android devices. And in response, it didn’t offer lower prices or offer better terms to developers and consumers. Instead, it imposed complex rules and fees through its App Store and developer agreements, stifling innovation and limiting competition.

Apple’s actions have increased its smartphone dominance and expanded its control to digital wallets and smartwatches by restricting their compatibility with non-Apple products. And this has had broader implications in other industries. The government claims Apple has stifled innovation and competition tied to smartphone technology, such as financial services, entertainment, and more.

So the case seeks to address Apple’s anticompetitive behavior. It aims to restore competition, lower prices for consumers, reduce fees for developers, and encourage innovation. The case is particularly interesting in how it highlights the contrast between Apple’s early days as an innovative startup and its current status as a monopolist.

The government says that this has drastically hurt market competition and consumers.

November 19, 2012 Electronic Discovery, Litigation, Privacy

Trial court erred in ordering defendant to turn over his iPhone in ediscovery dispute

AllianceBernstein L.P. v. Atha, — N.Y.S.2d —, 2012 WL 5519060 (N.Y.A.D. 1 Dept., November 15, 2012)

Plaintiff sued its former employee for breach of contract alleging he took client contact information on his iPhone when he left the job. The trial court ordered defendant to turn the iPhone over to plaintiff’s counsel so plaintiff could obtain the allegedly retained information.

Defendant sought review of the discovery order. On appeal, the court reversed and remanded.

The appellate court found that the lower court’s order that defendant turn over his iPhone was beyond the scope of plaintiff’s request and was too broad for the needs of the case. Ordering production of defendant’s iPhone (which, the court observed, has built-in applications and internet access) “was tantamount to ordering the production of his computer.” The iPhone would disclose irrelevant information that might include privileged communications or confidential information.

So the court ordered that the phone and a record of the device’s contents be delivered to the court for an in camera review to determine what, if any information contained on the phone was responsive to plaintiff’s discovery request.

October 24, 2012 Computer Crime, Privacy

Class action against Path faces uphill climb

Hernandez v. Path, Inc., 2012 WL 5194120 (N.D.Cal. October 19, 2012)

uphill path

Earlier this year plaintiff filed a class action lawsuit against photo app provider Path, alleging ten claims relating to Path’s alleged surreptitious collecting of mobile device address books and installation of tracking software. Path moved to dismiss the lawsuit for lack of standing and for failure to state a claim. The court held that plaintiff had standing to pursue the case, but dismissed some of the claims.

Standing

The court found that alleged depletion of “two to three seconds of battery capacity” was de minimus and thus not sufficient to support the injury-in-fact plaintiff was required to show. Citing to the fairly recent case of Krottner v. Starbucks, the court found that the hypothetical threat of future harm due to a security risk to plaintiff’s personal information was insufficient to confer standing. The only basis on which the court found there to be a sufficient claim of injury to support standing was the (hard to believe) claim by plaintiff that he would have to spend $12,500 to pay a professional to remove the Path app and related data from his phone.

The Dismissed Claims

The court dismissed for failure to state a claim (with leave to amend) plaintiff’s claims under the Electronic Communications Privacy Act (ECPA), Stored Communications Act (SCA), California wiretapping statute, state common law privacy, conversion and trespass.

ECPA and California Wiretapping Statute Claim. The court dismissed the ECPA and California Wiretapping Statute claims, finding that the complaint did not allege that Path intercepted any communication contemporaneous with its transmission. At best (from plaintiff’s perspective), it appears that Path gathered information on social networking sites after it was transmitted. And the uploading of the address books does not appear to have qualified as a communication under these statutes.

SCA Claim. The SCA claim failed “on multiple fronts.” Plaintiff was not a provider of electronic communication services and his iPhone was not a facility through which such service was provided. So Path’s alleged access did not come within the prohibition of the SCA. Moreover, the address books were not communications to which the SCA applied, because they were not in “electronic storage” as defined by the SCA, namely, being in temporary, intermediate storage incidental to their electronic transmission. (We see a similar issue in the recent Jennings case from South Carolina.)

State Common Law Privacy. This claim would have required plaintiff to show (1) public disclosure (2) of private facts (3) which would be offensive and objectionable to the reasonable person and (4) which is not of legitimate public concern. The court found there was no public disclosure, only Path’s storage of data on its servers.

Conversion. Under California law, to be successful on a claim of conversion, plaintiff would have had to plead and prove “ownership or right to possession of property, wrongful disposition of the property right and damages.” The court dismissed this claim because plaintiff pled only that Path copied the data, not dispossessing him of it. (As an aside, it’s this very point that underscores my common admonition to copyright maximalists that infringement is not “theft,” because theft involves dispossession. End of digression.)

Trespass. The California common law action of trespass in the computer context requires a plaintiff to show that (1) defendant intentionally and without authorization interfered with plaintiff’s possessory interest in a computer system; and (2) defendant’s unauthorized use proximately resulted in damage to plaintiff. The tort “does not encompass … an electronic communication that neither damages the recipient computer system nor impairs its functioning.” Intel v. Hamidi, 30 Cal.4th 1342 (Cal. 2003). In this case, plaintiff did not allege that the functioning of his mobile device was significantly impaired to the degree that would enable him to plead the elements of a trespass. The court found that any depletion of his mobile device’s finite resources was a de minimis injury. (See the standing analysis above.)

The Remaining Claims

The claims for violations of the California Computer Crime Law, Californa’s Unfair Competition Law (Section 17200), negligence and unjust enrichment remain in the case.

California Computer Crime Law. Based on the limited briefing, the court could not conclude as a matter of law whether Path’s alleged conduct fell outside this statute. The question remains whether providing the app which plaintiff voluntarily downloaded and installed on his iPhone provided undisclosed software code that surreptitiously transferred plaintiff’s data.

Californa’s Unfair Competition Law. This statute prohibits “any unlawful, unfair or fraudulent business act or practice.” The court found that the conduct alleged in the complaint, if true, constituted an unlawful or unfair act or practice within the meaning of the statute. It found that plaintiff had failed to allege any fraudulent practice, but since plaintiff met the first two prongs (unlawfulness and unfairness), the claim survived.

Negligence. Plaintiff alleged that Path owed a duty to plaintiff to protect his personal information and data property and take reasonable steps to protect him from the wrongful taking of such information and the wrongful invasion of privacy. Path allegedly breached this duty by, among other things, accessing and uploading data from plaintiff’s phone, storing that data in an unsecure manner, and transmitting the data to third parties. Path relied on In re iPhone Application Litigation to argue it had no duty to plaintiff. In that decision, Judge Koh held that plaintiffs had not yet adequately pled or identified a legal duty on the part of Apple to protect users’ personal information from third-party app developers. This case was different because Path was a third party developer. Despite the existence of a duty, plaintiff’s claims of damages (here’s the $12,500 repair bill issue again) will likely face substantial challenges as the case progresses.

Unjust Enrichment. Path argued that unjust enrichment was not a cause of action under California law. The court cited to cases suggesting that California law does indeed recognize such a claim and kept in in this case.

Photo credit Flickr user stormwarning under this Creative Commons license.

April 5, 2011 Computer Crime, Privacy

Do certain mobile apps violate the Computer Fraud and Abuse Act?

[This is a guest post by attorney Caroline Belich. Caroline is a Chicago native, former Michigan State volleyball player, and recent admitee to the California bar with particular interest in the First Amendment.]

According to the Wall Street Journal and other sources, federal prosecutors in New Jersey are investigating whether certain mobile applications for smartphones have illegally obtained or transmitted information about their users. Part of the criminal investigation is to determine whether these app makers made appropriate disclosures to users about how and why their personal information is being used. The app makers subpoenaed include the popular online music service Pandora.

Examples of information disclosed by these app makers may include a user’s age, gender, location, and also unique identifiers for the phone. The information may then passed on to third parties and advertising networks. The problem is that users may be unaware that their information is being accessed by a smartphone app because a maker failed to notify them.

As a result, this failure to notify may violate the Computer Fraud and Abuse Act (18 USC 1030). The CFAA is a federal statute that is often used against hackers. Applying this rationale here, federal prosecutors may argue that the app makers essentially hacked users cellphones.

However, some legal experts believe that criminal charges against the app makers are unlikely. Supporting this belief is the fact that many criminal charges against companies result in non-prosecution or deferred prosecution agreements in exchange for concessions of wrongdoing or monetary payments.

But while criminal charges are doubtful, civil lawsuits by users and causes of action brought by the Federal Trade Commission (FTC) may not be. First, consumers may sue app makers for failure to notify under privacy rights claims. Second, the FTC could allege unfair and deceptive trade practices by makers for failure to inform users how their personal information is being employed. Recently, Google settled with the FTC regarding its social network, Buzz, where allegations were made about violations of users’ privacy.

In light of the potential for privacy rights violations and deceptive trade practices, the FTC has advocated a “Do Not Track” option for web browsers and cellphone users, similar to the “Do Not Call” list for telemarketing. But app makers strongly oppose this idea, of course, for various reason. First, it could obstruct their ability to collect data about their users’ utilization of their product. Second, the option could frustrate financial opportunities with third parties seeking the invaluable consumer statistics. And the third justification is best depicted by Facebook’s privacy policy – while a user may be giving away his own information, he’s not giving away that of his friends… as long as his friends haven’t shared the info with “everyone.”

So even if these criminal investigations do not come to fruition, at least the possibility is making the public aware of their rights involving smartphone products so that industry standards may be created or laws requiring notification may be made.

November 16, 2010 Privacy

Case against iPhone eavesdropper moves forward

Caro v. Weintraub, 2010 WL 4514273 (D. Conn. November 2, 2010)

Stepson who used iPhone to record conversation about dying mother’s will may be liable for invasion of privacy and infliction of emotional distress.

This past summer the case against a man accused of using his iPhone to surreptitiously record a family conversation about his dying mother’s will got some attention when the court dismissed the stepfather-widower’s claim for violation of the Electronic Communications Privacy Act.

But the dismissal of that case was not the end of the story. Plaintiff had filed a separate lawsuit, claiming, among other things, invasion of privacy (by intrusion upon seclusion) and intentional infliction of emotional distress. Defendants (the allegedly eavesdropping iPhone user and his brother) moved to dismiss the invasion of privacy and emotional distress claims. The court denied the motion.

Plaintiff alleged that four days before his wife (defendants’ mother) died, defendants and some other family members came over to the house to discuss the mother’s will. Unbeknown to plaintiff, one of the defendant brothers allegedly used his iPhone to secretly record the conversation. In the subsequent litigation over the mother’s estate, the stepsons attempted to use an allegedly altered version of the recording as evidence.

The court found that the act of secretly recording the conversation could constitute invasion of privacy. Whether it actually happened the way plaintiff claimed will be decided later by a jury. But the judge found that a jury was entitled to make that determination. Plaintiff’s claims that defendants surreptitiously recorded an intimate conversation about a family member’s will qualified as an offensive intentional intrusion in private affairs that could be highly offensive to a reasonable person.

As for the intentional infliction of emotional distress claim, the court found that defendants’ alleged conduct “exceed[ed] all bounds usually tolerated by decent society.” As with the invasion of privacy claim, the question of liability will go to a jury (unless the case settles, of course.)

September 8, 2010 Litigation

iPhone using juror causes manslaughter conviction to be overturned

Tapanes v. State, — So.3d —, 2010 WL 3488709 (Fla.App. 4 Dist. September 8, 2010) [Opinion (PDF)]

Defendant was accused of killing his new neighbor and was indicted for murder. The jury convicted him of the lesser charge of manslaughter.

One of the key concepts in the case, and mentioned specifically in the jury instructions, was whether the defenant acted with “prudence” in his dealings with the victim.

During a break from deliberations, the jury foreperson used his iPhone to access Encarta and look up the word “prudence”. Adding to this misdeed, the foreperson shared this information with the other jurors.

Based on this misconduct, defendant filed a motion seeking a new trial, and the trial court denied that motion. So defendant sought review with the Court of Appeal of Florida. On appeal, the court reversed, holding that the defendant was entitled to a new trial.

The appellate court observed that the concept of “prudence” was one that could have been key to the jury’s deliberations. Using the smartphone in this way was analogous to using a dictionary, and that conduct has generally been prohibited in juror deliberations. The appellate court found that at the very least, it could “not say that there [was] no reasonable possibility that the . . . misconduct . . . did not affect the verdict in this case.”

Ed. note: If the jury foreperson was savvy enough to use an iPhone, why on earth was he consulting Encarta? Hello, 1995 called – it wants its web pages back.