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Legislators Express Doubt About a First Sale Doctrine for Digital Goods

Gigaom's Jeff John Roberts reports on a Congressional hearing held last week on whether the first sale doctrine should apply to digital goods. Buyers of e-books or e-music can't resell those digital goods or leave them behind when they die because they are licensing the goods from companies like Amazon and Apple, Roberts writes. Congressional members were skeptical about creating a digital-based first sale doctrine, but expressed concern that licenses for digital goods were too lopsided against consumers. "The most popular solution to the problem of diminished property rights appears to be better licenses," Roberts concludes.

Top Plaintiffs Attorneys Diving Into GM Litigation

Some of the leading plaintiffs attorneys in the country are lining up to sue over General Motors' handling of defective ignition switches, the Wall Street Journal's Ashby Jones reports. GM CEO Mary Barra said an internal report prepared by former U.S. Attorney Anton Valukas "demonstrated a 'pattern of incompetence and neglect' in the auto maker's 11-year failure to recall cars equipped with a defective ignition switch," WSJ further reports.

After the article was published, the U.S. Judicial Panel on Multidistrict Litigation ordered GM cases to be consolidated in Southern District of New York where GM's bankruptcy is pending.

GSK Faces Lawsuit Over Generic Drug After 7th Circuit Ruling

The Wall Street Journal's Ed Silverman reports on a rare ruling: brand-name drug manufacturer GlaxoSmithKline must face a Paxil lawsuit from a plaintiff who took the generic version of the drug.

The U.S. Supreme Court has held that generic drugmakers can't be held liable for failing to warn consumers of the risk of their products because they have no authority to change the label approved by federal regulators for the brand-name version.

But the Seventh Circuit denied a bid by GSK to dismiss the lawsuit even though the plaintiff took a generic version of Paxil, WSJ reports. GSK's liability stems from designing and labeling the drug, WSJ further reports.

 

 

Should FAA Create Permit System for Drone Use?

Many in the burgeoning drone industry are frustrated by the Federal Aviation Administration's glacial pace in issuing new rules to regulate the use of these lightweight flying devices and regulators' application of old rules to ground the use of drones for newsgathering and other commercial purposes. Gigaom's Jeff John Roberts suggests the FAA should use a permit system like the one used for motor vehicles. The CEO of Airware, a startup that provides hardware and software to drone businesses, told Gigaom "the best way to resolve the ongoing legal conflicts involving drones is to designate separate airspaces for manned and unmanned aircraft, including a buffer zone between them. Doing so, he said in a recent phone interview, would permit a more relaxed set of rules for drones. Specifically, [CEO Jonathan] Downey suggested this might involve a permit system where drone owners could obtain a license after passing a test."

Wisconsin's Ban on Same-Sex Marriage Latest to Go

U.S. District Judge Barbara Crabb struck down Wisconsin's constitutional ban on same-sex marriage, the Wisconsin State Journal reports. “'Quite simply, this case is about liberty and equality, the two cornerstones of the rights protected by the United States Constitution,' U.S. District Judge Barbara Crabb wrote in her Friday ruling," according to the Journal. Crabb also wrote that, "'If the state is going to deprive an entire class of citizens of a right as fundamental as marriage, then it must do more than say, ‘this is the way it has always been’ or ‘we’re not ready yet.'"
 

Kristen Hansen, with the American Civil Liberties Union, told the Journal, "'We just don't think that the majority should vote on the civil rights of the minority.'"

23 Attorney Generals Challenge CT's Gun Laws

Connecticut enacted the strongest gun laws in the country in the wake of the Sandy Hook school shooting. Now 23 attorney generals from other states are joining a challenge to the constitutionality of those laws, the Connecticut Law Tribune's Jay Stapleton reports. The coalition of attorney generals filed a similar amicus brief to challenge New York's gun laws.

"The coalition claims Connecticut's gun law violates the law established in [the U.S. Supreme Court's ruling in District of Columbia v.] Heller by banning versions of the AR–15 semi-automatic rifle, which is popular with hunters and sports shooters. It was also the type of weapon used in the Newtown shootings that killed 26 students and educators at Sandy Hook Elementary School on Dec. 14, 2012," Stapleton writes.

Federal Judge Asks Supreme Court to End NSA's Phone Surveillance

A federal judge in Idaho, while upholding the National Security Agency's surveillance program of telephone records because of legal precedent, urged the U.S. Supreme Court to rule that the surveillance is unconstitutional, the Wall Street Journal reported: Judge B. Lynn "Winmill said there is a 'looming gulf'' between a 1979 Supreme Court precedent that allowed the government to gather the phone records of a single suspect, and the NSA program that collects millions of phone records of Americans to build a searchable database, including the time, duration, and numbers dialed. The program doesn't gather the content of calls."

Reporter May Face Jail Again After Supreme Court Rejects Reporters Privilege Case

The U.S. Supreme Court rejected the appeal of New York Times' reporter James Risen over a lower court ruling that he must identify his confidential source for a national security story, Risen's colleague Adam Liptak reports. Risen could face jail if he refuses to comply with the court order. While the Obama administration said in its brief to the U.S. Supreme Court that there is no evidentiary privilege for reporters not to identify confidential sources who have broken the law, Attorney General Eric H. Holder Jr. hinted that federal prosecutors may not ask for Risen to be jailed for contempt if he refuses to testify, Liptak further reports.

EPA Sets Rule Aiming to Cut Carbon Emissions By 30% By 2030

The Environmental Protection Agency has proposed a draft rule to regulate the carbon-dioxide emissions from fossil fuel-fired power plants, the Wall Street Journal reports. The mandate would require plants to cut their emissions by 30 percent by 2030. EPA is taking comment on the measure as well as another measure that would result in an estimated reduction of carbon emissions by 24 percent in 2025.

Digital Disruption, Litigation Over Peer-to-Peer Services Comes to Connecticut Taxi Industry

Submitted by Amaris Elliott-Engel on Mon, 06/02/2014 - 08:26

The lodging indsutry, the lending industry and the taxi industry are all being affected by digital disruption from social media and mobile technologies that connect customers to their peers selling a previously untapped economic market. Here's a story I wrote for the Connecticut Law Tribune about this trend starting up with the Connecticut taxi industry:

An alliance of Connecticut taxicab companies is seeking to shut down two competitive upstarts whose fleet of drivers can be summoned by consumers through smartphone apps.

Fourteen Connecticut-based taxicab and livery companies and the industry's Connecticut trade association filed a federal lawsuit in an attempt to block Uber and Lyft from doing business in the state.

Both Uber and Lyft use online platforms to connect passengers with drivers using their personal, noncommercial vehicles, and both say they are not taxi dispatch services because they don't own vehicles, book rides in advance or employ drivers.

With the filing of Greenwich Taxi v. Uber Technologies, Connecticut joins the ranks of other states with litigation pending against transportation network companies functioning in the name of consumer convenience but in a gray area of consumer protection laws.

Connecticut is one of several states that has warned consumers they might not be covered by the personal automobile insurance policies of drivers associated with Lyft and Uber. The Connecticut Insurance Department noted personal policies commonly exclude claims arising while motorists are driving for hire.

Lyft said in a statement it has a $1 million commercial liability policy, "which is 10 times the $100,000 requirement of Connecticut taxis. Lyft also provides excess uninsured/underinsured motorist and contingent collision coverage for drivers and screens out applicants for any violent crimes, sexual offenses, theft, property damage and felonies."

Lyft also said it screens drivers on the basis of their driving records.

Uber faces at least 13 lawsuits in the U.S. and scrutiny from state insurance agencies in 11 states, according to VentureBeat, a technology-oriented website. For its part, Lyft recently was enjoined from operating by the St. Louis Metropolitan Taxicab Commission.

Mary Alice Moore Leonhardt, newly joined as a principal at Rome McGuigan, in Hartford, said her clients hope Attorney General George Jepsen will intervene in the lawsuit, that the state Department of Consumer Protection will enter a cease-and-desist order against the two ride-sharing companies, and that the state Department of Transportation and the state Department of Motor Vehicles will take regulatory action.

The taxi industry has embraced Connecticut's "safety-driven regulations," but Uber and Lyft aren't abiding by the same safety standards, including criminal background checks on drivers, safety inspections of vehicles and abiding with antidiscrimination laws, Leonhardt said.

Greenwich Taxi and the other plaintiffs are asking for a level playing field, Leonhardt said.

"Taxi and livery companies have invested significant capital and resources to develop systems and infrastructure that ensures regulatory compliance and provides adequate consumer protection," the complaint said.

Leonhardt said she understands the desire of Uber and Lyft's customers to have the convenience of accessing car rides through their smartphones. Many of her taxi cab and livery service clients already have smartphone apps or are in the process of implementing them, she said.

"The industry nationwide recognizes that the capacity to serve clients with a smart app is important," Leonhardt said. "That's just a matter of time."

Uber said in an emailed statement "this baseless lawsuit is just another example of taxi company owners who don't want to compete and who would rather limit consumer choice and driver opportunity." For its part, Lyft said in a statement that it "fills an economic and transportation need for both drivers and passengers in Fairfield County, and our safety requirements far exceed what is required for existing transportation options in the state."

But, said Leonhardt, the ride-sharing services are able to discriminate on the basis of financial status. Not only do riders rate drivers, but drivers rate riders, creating a potential record of discrimination, Leonhardt said. "Defendants' approach ignores virtually all taxi regulations designed to protect customers who suffer from disabilities, who live in less secure neighborhoods, or who simply cannot afford a limousine," the complaint said.

Both services have pricing that surges when demand is high, even though taxi pricing is regulated in Connecticut, the plaintiffs said.

The plaintiffs also claim Uber and Lyft are inducing taxi and livery drivers to sign up with their services in violation of state law and regulations.

The plaintiffs are prosecuting claims of violations of the federal Lanham Act for misrepresentation, the federal Racketeer Influenced and Corrupt Organizations Act, the Connecticut Unfair Trade Practice Act and others.

Cabbies aren't the only profession facing disruption from social media and mobile technologies that connect customers to their peers selling a previously untapped economic market.

The lodging industry is facing competition from Airbnb, a site that allows residential property owners to offer their properties for rent. New York Attorney General Eric Schneiderman is investigating if Airbnb hosts are paying taxes on the services they offer renters and if they're violating state law banning rentals of less than 30 days unless the owner is on the premises.

 

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