Last week, I objected to Senator Warner relying on the flawed AOL/Time Warner merger conditions as a template for tech regulatory policy, but there is a much deeper problem contained in his proposals.  Although he does not explicitly say “big is bad” when discussing competition issues, the thrust of much of what he recommends would serve to erode the power of larger firms in favor of smaller firms without offering a justification for why this would result in a superior state of affairs. And he makes these recommendations without respect to whether those firms actually engage in conduct that is harmful to consumers.

Read the full piece here.

Senator Mark Warner has proposed 20 policy prescriptions for bringing “big tech” to heel. The proposals — which run the gamut from policing foreign advertising on social networks to regulating feared competitive harms — provide much interesting material for Congress to consider.

Read the full piece here.

The EC’s Android decision is expected sometime in the next couple of weeks. Current speculation is that the EC may issue a fine exceeding last year’s huge 2.4B EU fine for Google’s alleged antitrust violations related to the display of general search results. Based on the statement of objections (“SO”), I expect the Android decision will be a muddle of legal theory that not only fails to connect to facts and marketplace realities, but also will perversely incentivize platform operators to move toward less open ecosystems.

Read the full piece here.

In an ideal world, it would not be necessary to block websites in order to combat piracy. But we do not live in an ideal world. We live in a world in which enormous amounts of content—from books and software to movies and music—is being distributed illegally. As a result, content creators and owners are being deprived of their rights and of the revenue that would flow from legitimate consumption of that content.

Read the full piece here.

Summary

Chairwoman Greenstein, Vice Chairman Lagana, and members of the Law and Public Safety Committee, thank you for giving me the opportunity to testify before you.

The general thrust of my comments today is that bad incentives exist in the law enforcement practice known as Civil Asset Forfeiture (“CAF”) that lead to violations of our citizens’ civil rights. Without the support of the New Jersey legislature, it will be next to impossible to identify where and how those incentives are working to undermine our justice system. Thus, S1963, and its counterpart in the General Assembly, A3442, provide a crucial first step in the process of coming to understand how CAF is practiced in New Jersey, and where our legislature will need to look next to root out any systematic injustices being perpetrated through CAF programs.

I believe there is a problem with how civil asset forfeiture is practiced on the whole, but even for those relatively more supportive of the practice, there is a way to conceptually divide the potentially problematic aspects of CAF in order to find areas for reform.

The problems of CAF are separable into two conceptual groups: in the first group there are bad systemic incentives that are distinct from the second group of more specific problems of procedural justice in individual cases. Indeed, if bad incentives exist within a legal system, that surely constitutes a breach of procedural justice as well, but the problems associated with systemic incentives operate on a global scale and are addressable as such, whereas the procedural justice issues such as presumptions, proof standards, and civil rights guarantees are typically more cognizable within a particular case.

When we talk about the incentives that drive CAF as a general law enforcement program, we think about things like whether law enforcement can retain the proceeds of the program and what utility those programs have generally on proceedings against criminal networks. On the other hand, when we think about procedural justice concerns, like the right to representation or the standard of proof, we are focused more on how the operation of a program affects individual citizens that are brought into the system as defendants (or, more precisely, parties with claims to property that is subject to a forfeiture proceeding).

The procedural justice problems that exist in CAF programs are troubling, and deserve the careful consideration of this body. Today, however, I intend to focus my remarks on the incentive problems with CAF programs because they are more directly implicated, and would stand most to be rectified, by the pending legislation before the Senate and Assembly.

As detailed further below, there are due process protections, guaranteed by the U.S. and New Jersey Constitutions, that are owed to individuals subjected to CAF proceedings. Yet, as CAF programs operate, these protections are systematically undermined. Based on the relevant case law from the Supreme Court, the due process protections are clear: individuals entrusted with protecting the public good, like prosecutors and other law enforcement officers, have an obligation to act on behalf of the community, free from incentives to bend the power of their offices to self-serving ends.

CAF has a place in law enforcement, and can be a useful tool for disrupting criminal networks. There must be, however, systemic protections that disrupt the possibility for bad incentives to work on our public servants. First, these protections should include a requirement that seized property be sent to some neutral fund — the general fund, a fund for drug treatment or prisoner reentry, or something of similar general applicability. By allowing law enforcement personnel to retain seized property for use by their department, we allow a distorting pressure to be placed on our public servants that is flatly unconstitutional.

Second, and the subject of today’s hearing, there should be general, standardized reporting requirements applied through uniform legislation on all agencies that seize property. These reports should be publicly available, and presented in a format that helps citizens to understand what property is being taken, what sorts of people it is being taken from, how much is being taken, and what exact uses it is being put to. Without this sort of transparency, we introduce yet more distortion into the administration of justice.

There is much more to do. We need, I believe, strong civil rights protections for persons who are subject to CAF proceedings. But I also believe that starting with greater transparency requirements like those contained in the bills under consideration would go a long way toward rectifying some of the major flaws in CAF proceedings.

There are some who view a host of claimed negative social ills allegedly related to the large size of firms like Amazon as an occasion to call for the company’s break up. And, unfortunately, these critics find an unlikely ally in President Trump, whose tweet storms claim that tech platforms are too big and extract unfair rents at the expense of small businesses. But these critics are wrong: Amazon is not a dangerous monopoly, and it certainly should not be broken up.  

Read the full piece here.

The paranoid style is endemic across the political spectrum, for sure, but lately in the policy realm haunted by the shambling zombie known as “net neutrality,” the pro-Title II set are taking the rhetoric up a notch. This time the problem is, apparently, that the FCC is not repealing Title II classification fast enough, which surely must mean … nefarious things? Actually, the truth is probably much simpler: the Commission has many priorities and is just trying to move along its docket items by the numbers in order to avoid the relentless criticism that it’s just trying to favor ISPs.

Read the full piece here.

Excess is unflattering, no less when claiming that every evolution in legal doctrine is a slippery slope leading to damnation. In Friday’s New York Times, Lina Khan trots down this alarmist path while considering the implications for the pending Supreme Court case of Ohio v. American Express. One of the core issues in the case is the proper mode of antitrust analysis for credit card networks as two-sided markets. The Second Circuit Court of Appeals agreed with arguments, such as those that we have made, that it is important to consider the costs and benefits to both sides of a two-sided market when conducting an antitrust analysis. The Second Circuit’s opinion is under review in the American Express case.

Read the full piece here.

The Internet is a modern miracle: from providing all varieties of entertainment, to facilitating life-saving technologies, to keeping us connected with distant loved ones, the scope of the Internet’s contribution to our daily lives is hard to overstate. Moving forward there is undoubtedly much more that we can and will do with the Internet, and part of that innovation will, naturally, require a reconsideration of existing laws and how new Internet-enabled modalities fit into them.

Read the full piece here.