Tech Brief: Judges Rule Uber-Waymo Case Will Go to Trial, Not Arbitration


Government Brief

  • The American Civil Liberties Union and the Electronic Frontier Foundation are suing the Department of Homeland Security on behalf of 10 U.S. citizens and one permanent resident who had their electronic devices searched by Customs and Border Protection without a warrant. The two groups contend that the searches violated the individuals’ privacy rights. (Vice News)
  • A date of Oct. 3 is set for Equifax Inc. CEO Richard Smith to testify before a House panel on what cybersecurity experts are calling one of the largest and most sensitive hacks ever recorded. Nearly 40 states, led by Illinois, are also probing the company’s handling of the breach. (Reuters)
  • Despite Apple Inc.’s assurances during the rollout of iPhone X that data for its Face ID unlocking system wouldn’t be stored on the cloud or shared with a third party but instead remain in the smartphone, Sen. Al Franken (D-Minn.) wrote to Apple expressing privacy concerns. Among other things, Franken wants to know how the company might deal with law enforcement requests for the data. (Recode)

Business Brief

  • A panel for the U.S. Court of Appeals for the Federal Circuit denied Uber Technologies Inc.’s appeal request for its legal dispute with Waymo LLC to move to private arbitration and ruled a public trial will proceed as scheduled in October. The court also ruled that Uber must hand over a crucial report for Waymo’s case that could hold evidence Uber stole trade secrets related to the development of self-driving cars. (The Mercury News)
  • Equifax blamed vulnerabilities in a web-server software called Apache Struts for the security breach that potentially exposed the personal data of 143 million people. In what it termed a “progress report,” Equifax also suggested the full scope of the breach is yet unknown. (The Wall Street Journal)
  • Verizon Communications Inc. CEO Lowell McAdam said the company needs to establish an “over-the-top” TV streaming platform in order to take advantage of the advertising capabilities of new acquisitions AOL and Yahoo. He said a decision will come within the next six months on how to accomplish that. (Bloomberg)

Chart Review

Events Calendar (All Times Local)

Thursday
NATOA annual conference 8 a.m.
GSMA Mobile World Congress Americas 9 a.m.
FirstNet board and committees meet 9 a.m.
Senate Homeland Security Committee hearing on Lifeline program 10 a.m.
FCBA CLE on FCC and FTC enforcement priorities 3 p.m.
Friday
Newseum event on the future of online speech 9 a.m.
Seminar Group event on autonomous vehicles regulation 9 a.m.
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General

China says review of foreign investments should not be used as tool for protectionism
Staff, Reuters

 China’s commerce ministry said on Thursday that the review of foreign investments in sensitive sectors should not be used as a tool for protectionism. U.S. President Donald Trump blocked a Chinese-backed private equity firm from buying a U.S.-based chipmaker on Wednesday, sending a clear signal to Beijing that Washington will oppose takeover deals that involve technologies with potential military applications.

Agricultural Giants Teach Computers to Farm
Jacob Bunge, The Wall Street Journal

On Midwestern fields and in research greenhouses, agricultural giants like Monsanto Co. and BASF SA are teaching machines how to farm. The companies are expanding early-stage investments in artificial intelligence, joining other industries in betting that research and decision-making can be streamlined with computer programs that teach themselves by picking patterns out of data.

Apple Warns That Ireland Delays Threaten $1 Billion Project
Dara Doyle, Bloomberg

Apple Inc. has warned Irish authorities that continuing delays around its proposed data center in the west of the country could jeopardize the $1 billion project, according to two people familiar with the matter. The iPhone maker, which scouted 19 countries before choosing Ireland, raised concern that the project remains mired in the planning process, according to the people who asked not be named because the matter is private.

Stocks Edge Lower as Miners Drop; Currencies Drift: Markets Wrap
Samuel Potter, Bloomberg

The rally in risk assets took a breather amid further signs China’s economy is cooling. That weighed on commodities including base metals, which in turned dragged down mining stocks.

Intellectual Property and Antitrust

Group Including Apple, Dell Moves to Buy Toshiba’s Chip Business
Dana Mattioli and Dana Cimilluca, The Wall Street Journal

A group including Apple Inc. and Dell Technologies Inc. surged to the front of a hotly contested race to acquire Toshiba Corp.’s memory-chip business, a crucial supplier to some of the world’s biggest makers of electronic gear. Toshiba said Wednesday it had signed a nonbinding agreement with the leader of the group, private-equity firm Bain Capital, and intends to reach a deal by the end of September.

Toshiba says Western Digital overstating rights over chip business
Staff, Reuters

Toshiba Corp said its business partner Western Digital Corp had been “persistently” overstating its rights over a memory chip unit that the Japanese firm is looking to offload, showing the two remain at loggerheads over the $18 billion sale. The statement from the embattled Japanese conglomerate comes a day after it said it was stepping up talks to sell the unit to a group led by Bain Capital and South Korean chipmaker SK Hynix.

Telecom, Wireless and TV

Verizon CEO Sees Decision on Online TV Service in 6 Months
Scott Moritz and Olga Kharif, Bloomberg

Verizon Communications Inc. will decide in the next six months how to deliver an online TV service, Chief Executive Officer Lowell McAdam said. Although web-based TV is becoming “a crowded field,” the telecommunications giant needs to participate to take advantage of the advertising capabilities of its AOL and Yahoo! acquisitions, McAdam said Wednesday at Bloomberg’s Sooner Than You Think conference.

U.S. wireless carriers dial back discounts on new iPhones
Sheila Dang, Reuters

U.S. consumers who want Apple Inc’s newest iPhones, including its most expensive model yet, the iPhone X, may find fewer deals as wireless carriers are less willing to offer subsidies on devices in a saturated market. New phone launches have long offered carriers a chance to gain market share by offering incentives such as free service and discounts.

Mobile Technology and Social Media

Waymo v. Uber: Uber’s second arbitration push thwarted, case speeds on toward trial
Marisa Kendall, The Mercury News

Thwarting Uber’s second attempt to push its high-profile, high-stakes trade secrets battle with rival Waymo into private arbitration, a panel of federal appellate judges on Wednesday ruled the case instead will proceed toward its October trial date. That means the legal battle, which will have a major impact on Uber’s self-driving car program and the burgeoning industry as a whole, will play out in public court — likely with all of Silicon Valley watching — instead of behind closed doors.

Musk now targets October to unveil Tesla semi truck
Staff, Reuters

Tesla Inc Chief Executive Elon Musk said the electric carmaker is tentatively scheduled to unveil its planned semi-truck in late October, about a month later than the billionaire had earlier estimated. “Tesla Semi truck unveil & test ride tentatively scheduled for Oct 26th in Hawthorne,” Musk said in a tweet on Wednesday.

Facebook bans earning cash from smut and hate
Brian Bennett, CNET

Facebook just officially put the kibosh on shady ways to use its network for profit. The social media giant updated its standards and guidelines, effectively banning profit from a wide variety of potentially controversial and unsavory content.

Cybersecurity and Privacy

ACLU and EFF Sue Trump Administration Over Cell Phone Searches at the Border
Jason Koebler, Vice News

The American Civil Liberties Union and Electronic Frontier Foundation sued the Department of Homeland Security Wednesday on behalf of 10 US citizens—including a NASA engineer and a former Air Force Captain—who had their electronic devices searched at the border. One permanent US resident, a Haitian citizen, also joins the suit.

Apple is facing questions from the U.S. Senate on the privacy protections in iPhone X and Face ID
Tony Romm, Recode

A day after Apple unveiled its new iPhone X — a device that its owner can unlock using facial recognition — Sen. Al Franken is pressing the tech giant to detail the privacy and security safeguards it has in place for biometric data. To Franken, the concern is that Apple could use the so-called faceprints it collects through its new unlocking system, called Face ID, “to benefit other sectors of its business, sell it to third parties for surveillance purposes, or receive law enforcement requests to access it facial recognition system — eventual uses that may not be contemplated by Apple customers,” the lawmaker said in a letter to the company Wednesday.

Equifax CEO to testify to Congress as states begin probes
Karen Freifeld and Diane Bartz, Reuters

Nearly 40 states have joined a probe of Equifax Inc’s handling of a massive data breach that exposed valuable information on up to 143 million Americans and sent shares of the credit reporting company tumbling. Congress is also probing the hack, and Equifax’s chief executive, Richard Smith, is expected to testify on Oct. 3 before a House of Representatives panel.

Equifax Blames Exploited Web-Server Software for Data Breach
AnnaMaria Andriotis, The Wall Street Journal

Equifax Inc. said criminals exploited web-server software in the data breach that affected potentially 143 million Americans but didn’t offer further detail on who may have been behind the hack. The company confirmed late Wednesday in what it called a progress report that hackers exploited a vulnerability with a U.S. website application called Apache Struts CVE-2017-5638.

Dem senator calls on FTC to probe Equifax
Ali Breland, The Hill

Sen. Mark Warner (D-Va.) is calling on the Federal Trade Commission to investigate the Equifax breach that compromised the personal information of 143 million Americans. Warner, who serves as the top Democrat on the Senate Intelligence Committee, wants the FTC to examine Equifax’s cybersecurity practices leading up to and following the breach.

Russia says Kaspersky removal in U.S. delays bilateral ties recovery
Staff, Reuters

The decision by the U.S. government to stop using Kaspersky Lab products is “regrettable” and delays the prospects of a restoration of bilateral ties, the Russian embassy in the United States said. The Trump administration has told U.S. government agencies to remove Kaspersky Lab products from their networks.

Opinions, Editorials and Perspectives

Chelsea Manning: The Dystopia We Signed Up For
Chelsea Manning, The New York Times

For seven years, I didn’t exist. While incarcerated, I had no bank statements, no bills, no credit history.

Equifax Critics Are Missing the Bigger Point
Amar Bhidé, The Wall Street Journal

Outrage that Equifax exposed more than 143 million credit records to identity thieves misses the point. We really should worry about what makes impersonation so easy—why do lenders know so little about the people to whom they issue credit?

Research Reports

Signs of Digital Distress: Mapping broadband availability and subscription in American neighborhoods
Adie Tomer et al., The Brookings Institution

The internet is now a fundamental component of the American economy, creating new ways to educate, employ, bring services to, and entertain every person. Broadband, especially wireline broadband in American homes, is the essential infrastructure for unlocking the internet’s economic benefits.

Briefings

Tech Brief: SEC Reveals It Was Hacked Last Year

The Securities and Exchange Commission said a computer system used for storing documents filed by publicly traded companies had been hacked last year. The cyberattack was first detected by the regulator last year, but the SEC said it had learned only last month that the compromised information may have been used in illegal stock trades.

Tech Brief: 3 House Democrats Call for FCC Investigation of Sputnik

Three Democratic members of the House Energy and Commerce Committee called on the Federal Communications Commission to investigate whether Sputnik, a news organization established by a Russian state-owned news agency, violated the public interest standard of its broadcast license with its radio show. Reps. Anna Eshoo (Calif.), Frank Pallone Jr. (N.J.) and Mike Doyle (Pa.) asked FCC Chairman Ajit Pai to follow up on a New York Times Magazine report that suggested the organization used U.S. airwaves to broadcast programming aimed at influencing the outcome of the 2016 U.S. presidential election.

Tech Brief: FCC Requests More Information on Sinclair-Tribune Merger

The Federal Communications Commission asked Sinclair Broadcast Group to provide more information on its proposal to acquire Tribune Media Co., a merger currently pending FCC approval. The FCC’s Media Bureau chief wrote a letter to Sinclair asking the telecommunications company to present further information about the size of its current audience, as well as the steps the company plans to take to stay below the ownership cap.

Tech Brief: Kaspersky Agrees to Testify Before House Committee

The House Science, Space and Technology Committee invited Kaspersky Lab Inc. co-founder and CEO Eugene Kaspersky to testify, along with other private and U.S. government cybersecurity experts, before the panel on Sept. 27, and he accepted the invitation — pending the acquisition of an expedited visa. The Moscow-based company, which makes antivirus software, is on the defensive from allegations it aids Russian espionage efforts.

Tech Brief: House Democrats Request Answers From Equifax on Data Breach

Led by Rep. Frank Pallone Jr. (D-N.J.), all 24 Democrats on the House Energy and Commerce Committee sent a letter to Equifax Inc. CEO Richard Smith expressing concerns that it took more than a month for the company to reveal the massive data breach it said took place from mid-May through July, and about the scale and extent of the breach. The signers asked Smith to address these concerns prior to a planned hearing on the issue.

Tech Brief: Apple Expected to Unveil Premium Model ‘iPhone X’ Today

Apple Inc. plans to premiere the so-called iPhone X with a starting price of $999.00 at a 10th anniversary iPhone event on Tuesday, joining Samsung Electronics Co. Ltd in the market for luxury smartphones. In addition to the iPhone X, which uses infrared facial recognition to unlock the device, Apple is also expected to release cheaper models of the iPhone and an updated Apple Watch, with self-contained connect

Tech Brief: Two House Committees Call Hearings on Equifax Data Breach

Equifax Ltd. could be examined by up to three committees in the U.S. House of Representatives after a breach at the company exposed the data of roughly 143 million people. Chairman Jeb Hensarling (R-Texas) of the Financial Services Committee and Chairman Greg Walden (R-Ore.) of the Energy and Commerce Committee announced hearings, and Rep. Ted Lieu (D-Calif.) called for an investigation by the Judiciary Committee.

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