Law Commons^™

The Role Of Ethical Principles In Ai Startups, James Bessen, Stephen Michael Impink, Robert Seamans

Faculty Scholarship

Do high-tech startups benefit from developing more ethical AI? AI startups implement policies and take actions to manage ethical issues associated with data collection, storage, and usage and adapt to the norms of their industry. This paper describes these startups' ethics-related actions, including ethical AI policy adoption, and examines how these actions relate to startup performance. We find that merely adopting an ethical AI policy (i.e., a less costly signal) does not relate to increased performance. However, there is evidence that investors reward startups that take more costly preventative pro-ethics actions, like seeking expert guidance, training employees about unconscious bias, …

Bridging The Computer Science – Law Divide, Azer Bestavros, Stacey Dogan, Paul Ohm, Andrew Sellars

Faculty Scholarship

Many pressing societal questions can be answered only by bringing experts from different disciplines together. Questions around misinformation and disinformation, platform power, surveillance capitalism, information privacy, and algorithmic bias, among many others, reside at the intersection of computer science and law. We need to develop institutions that bring together computer scientists and legal scholars to work together on issues like these, and to train new innovators, thought leaders, counselors, and policymakers with hybrid training in both disciplines. In Universities, the disciplines of Computer Science (CS) and Law are separated by many wide chasms. Differences in standards, language, methods, and culture …

Bilski And The Information Age A Decade Later, Michael J. Meurer

Faculty Scholarship

In the years from State Street in 1999 to Alice in 2014, legal scholars vigorously debated whether patents should be used to incentivize the invention of business methods. That attention has waned just as economists have produced important new research on the topic, and just as artificial intelligence and cloud computing are changing the nature of business method innovation. This chapter rejoins the debate and concludes that the case for patent protection of business methods is weaker now than it was a decade ago.

Legislating Data Loyalty, Woodrow Hartzog, Neil Richards

Faculty Scholarship

Lawmakers looking to embolden privacy law have begun to consider imposing duties of loyalty on organizations trusted with people’s data and online experiences. The idea behind loyalty is simple: organizations should not process data or design technologies that conflict with the best interests of trusting parties. But the logistics and implementation of data loyalty need to be developed if the concept is going to be capable of moving privacy law beyond its “notice and consent” roots to confront people’s vulnerabilities in their relationship with powerful data collectors.

In this short Essay, we propose a model for legislating data loyalty. Our …

Industry Concentration And Information Technology, James Bessen

Faculty Scholarship

Industry concentration has been rising in the US since 1980. Does this signal declining competition and need for a new antitrust policy? Or are other factors causing concentration to rise? This paper explores the role of proprietary information technology (IT), which could increase the productivity of top firms relative to others and raise their market share. Instrumental variable estimates find a strong link between proprietary IT and rising industry concentration, accounting for much of its growth. Moreover, the top four firms in each industry benefit disproportionately. Large investments in proprietary software—$250 billion per year—appear to significantly impact industry structure.

Data Generated By New Technologies And The Law: A Guide For Massachusetts Practitioners, Andrew Sellars

Faculty Scholarship

This brief paper, created as part of a training on new technologies and evidence for MCLE New England, outlines the standards used to compel disclosure of information under the Stored Communication Act, and reviews the types of data stored on various consumer devices and their likely custodians, as well as cases and notes relevant to each devices. The paper serves as a quick introduction and checklist for those considering gathering information from these devices in the course of investigations in Massachusetts. The devices outlined include cell phones, social media platforms, secure messaging services, fitness trackers, home assistant devices (or "smart …

Taxing & Zapping Marijuana: Blockchain Compliance In The Trump Administration Part 3, Richard Thompson Ainsworth, Brendan Magauran

Faculty Scholarship

This is the third of a five-part series dealing with the rescission by U.S. Attorney General Jeff Sessions of the Obama-era policy that discouraged federal prosecutors from bringing charges in all but the most serious marijuana cases.

This article focuses on cyber-attacks on the main commercial chain, and the use of a private blockchain using HyperLedger Fabric as a platform.

This fraud is a direct, criminal attack; an attack designed to destroy/corrupt records of marijuana inventory and plant tags throughout the supply chain. The attack allows legalized marijuana to escape the system and be sold on the black market. A …

Zappers, Phantomware And Other Sales Suppression Software In The State Of Washington, Richard Thompson Ainsworth, Robert Chicoine

Faculty Scholarship

Electronic sales suppression (ESS) is a fraud that has been a (prominent) feature of the North American retail business since at least 1996. The first EES case in the US dates from 1981. ESS is a global problem. Depending on the jurisdiction, and the research study consulted, ESS is estimated to be present in 34% (of Canadian), 50% (of German – two studies), and 70% (of Swedish and Slovenian) businesses. It may be the case today, that “you cannot leave home without” encountering (or participating in) ESS.

The most common types of sales suppression technology are Zappers and Phantomware programming. …

Twenty Years Of Web Scraping And The Computer Fraud And Abuse Act, Andrew Sellars

Faculty Scholarship

"Web scraping" is a ubiquitous technique for extracting data from the World Wide Web, done through a computer script that will send tailored queries to websites to retrieve specific pieces of content. The technique has proliferated under the ever-expanding shadow of the Computer Fraud and Abuse Act (CFAA), which, among other things, prohibits obtaining information from a computer by accessing the computer without authorization or exceeding one's authorized access.

Unsurprisingly, many litigants have now turned to the CFAA in attempt to police against unwanted web scraping. Yet despite the rise in both web scraping and lawsuits about web scraping, practical …

Interpretation Catalysts In Cyberspace, Rebecca Ingber

Faculty Scholarship

The cybersphere offers a rich space from which to explore the development of international law in a compressed time frame. This piece examines the soft law process over the last decade of the two Tallinn Manuals – handbooks on the international law of cyber warfare and cyber operations – as a valuable lens through which to witness the effects of “interpretation catalysts” on the evolution of international law. In prior work, I identified the concept of interpretation catalysts – discrete triggers for legal interpretation – and their influence on the path that legal evolution takes, including by compelling a decision-making …

Blockchain, Bitcoin, And Vat In The Gcc: The Missing Trader Example, Richard Thompson Ainsworth, Musaad Alwohaibi

Faculty Scholarship

Blockchain is coming to tax administration and will cause fundamental change. This article considers the potential for blockchain technology as it applies to the introduction of a value added tax in the Gulf Cooperation Council.

Blockchain technology disrupts centralized ledgers. Blockchain improves efficiency, security and transparency. Perhaps no centralized ledger system presents more challenges than that of the modern tax administration. The central data storage system of a modern tax authority contains all return, payment, and audit activity for all taxpayers arranged tax-by-tax for three years or longer periods of time.

It is likely that blockchain will come first to …

Enhanced Damages For Patent Infringement: A Normative Approach, Keith N. Hylton

Faculty Scholarship

This paper takes a normative approach to patent infringement damages. Its underlying premise is that the goal of a damages regime should be to maximize society's welfare. Patent damages should therefore balance society's interest in encouraging innovation against the need to regulate infringement incentives. This balancing approach generates an optimal standard for awarding enhanced damages and guidelines for determining the size of the damages multiplier. On the legal standard, the approach developed here illuminates the factors that should be taken into consideration in the enhancement analysis, and, more importantly, the reasons those factors should be considered. On the precise size …

The Inadequate, Invaluable Fair Information Practices, Woodrow Hartzog

Faculty Scholarship

For the past thirty years, the general advice for those seeking to collect, use, and share people’s personal data in a responsible way was relatively straightforward: follow the fair information practices, often called the “FIPs.” These general guidelines were designed to ensure that data processors are accountable for their actions and that data subjects are safe, secure, and endowed with control over their personal information. The FIPs have proven remarkably sturdy against the backdrop of near-constant technological change. Yet in the age of social media, big data, and artificial intelligence, the FIPs have been pushed to their breaking point. We …

Vatcoin: The Gcc's Cryptotaxcurrency, Richard Thompson Ainsworth, Musaad Alwohaibi, Mike Cheetham

Faculty Scholarship

Bitcoin is the world’s first peer-to-peer cryptocurrency. VATCoin is similar, but it is used in tax compliance. Both Bitcoin and VATCoin are distributive ledger applications built upon blockchain technology. Bitcoin’s ledger is public; VATCoin’s is private. If adopted, VATCoin could well become the world’s first government-mandated cryptotaxcurrency. Unlike Bitcoin, VATCoin will not be a speculative currency. It is always fixed to the home currency.

This paper proposes that the Gulf Cooperation Council (GCC) adopt VATCoin in its VAT Framework. The GCC is expected to have multiple 5% VATs in place by January 1, 2018. There is an ample amount of …

How Oracle Erred: Functionality, Useful Articles, And The Future Of Computer Copyright, Wendy J. Gordon

Faculty Scholarship

In Oracle v. Google (2015), the Federal Circuit addressed whether the " method header " components of a dominant computer program were uncopyrightable as " merging " with the headers' ideas or function. Google had copied the headers to ease the ability of third-party programmers to interact with Google's Android platform. The court rebuffed the copyrightability challenge; it reasoned that because the plaintiff's expression might have been written in alternative forms, there was no " merger " of idea and expression. But the Oracle court may have been asking the wrong question. In Lotus v. Borland (1995), the owner of …

Brief Of Amici Curiae Law, Business, And Economics Scholars In Alice Corp. V. Cls Bank, No. 13-298, Jason Schultz, Brian Love, James Bessen, Michael J. Meurer

Faculty Scholarship

The Federal Circuit’s expansion of patentable subject matter in the 1990s led to a threefold increase in software patents, many of which contain abstract ideas merely tethered to a general-purpose computer. There is little evidence, however, to suggest this expansion has produced an increase in software innovation. The software industry was highly innovative in the decade immediately prior to this expansion, when the viability of software patentability was unclear and software patents were few. When surveyed, most software developers oppose software patenting, and, in practice, software innovators tend to rely on other tools to capture market share such as first-mover …

Rethinking Online Privacy In Canada: Commentary On Voltage Pictures V. John And Jane Doe, Ngozi Okidegbe

Faculty Scholarship

This article problematizes the use of the bona fide case standard as the legal standard for a court to order a third party Internet Service Provider ("ISP") to disclose subscriber information to a copyright owner in online piracy cases. It argues that ISP account holders have a reasonable expectation of privacy in their subscriber information. It contends that the current bona fide case standard affords a relatively low threshold of protection for Internet users’ subscriber information. The reason for which the article takes this position is that the bona fide case standard can be met solely by IP address evidence, …

Patent Litigation And The Internet, Samantha Zyontz, John R. Allison, Emerson H. Tiller, Tristan Bligh

Faculty Scholarship

Patent infringement litigation has not only increased dramatically in frequency over the past few decades,¹ but also has also seen striking growth in both stakes and cost.² Although a relatively rich literature has added much to our understanding of the nature, causes, and consequences of patent litigation during the past two decades,³ many interesting questions remain inadequately addressed. The nuances of and trends in patent litigation in different technology fields and industries, for example, are still understudied.⁴ Litigation of patents on new technologies has likewise received a dearth of attention. Here we seek to help begin …

Virtual Intermediaries: Consumption Tax Problems In Japan, Europe, And The United States - The Case Of The Virtual Travel Agent, Richard Thompson Ainsworth

Faculty Scholarship

Marketplace technology is (inadvertently) chipping away at the effectiveness of consumption taxes – the Japanese Consumption Tax (CT), the European value added tax (VAT), and the American sales tax (ST) are all affected. Frequently a technology-patch or a law change can repair the tax-damage, but sometimes even though a patch or a change is known the design of the levy (or the politics behind the design) impedes application. This paper assesses these consumption taxes by considering the impact that virtual travel agents have had on revenue yields. The paper draws specific conclusions for the Japanese CT, because this consumption tax …

Cloud Computing: Storm Warning For Privacy?, Nicole Ozer, Chris Conley

Faculty Scholarship

“Cloud computing” - the ability to create, store, and manipulate data through Web-based services - is growing in popularity. Cloud computing itself may not transform society; for most consumers, it is simply an appealing alternative tool for creating and storing the same records and documents that people have created for years. However, outdated laws and varying corporate practices mean that documents created and stored in the cloud may not have the same protections as the same documents stored in a filing cabinet or on a home computer. Can cloud computing services protect the privacy of their consumers? Do they? And …

Zappers: Tax Fraud, Technology And Terrorist Funding, Richard Thompson Ainsworth

Faculty Scholarship

"Zappers," or automated sales suppression devices, have brought unheard of efficiencies and economies of scale to a very simple tax fraud - skimming cash sales at point of sale (POS) terminals (electronic cash registers). Until recently the largest tax fraud case in Connecticut, also the "largest computer driven tax-evasion case in the nation," was a zapper case. Stew Leonard's Dairy in Norwalk Connecticut skimmed $17 million in receipts and hid the cash in St. Martin (a Caribbean island). Talal Chahine and his wife, Elfat El Aouar, owners of the La Shish restaurant chain in Detroit Michigan have the dubious honor …

Biometrics, Certified Software Solutions, And The Japanese Consumption Tax: A Proposal For The Tax Commission, Richard Thompson Ainsworth

Faculty Scholarship

Significant change is anticipated in the Japanese Consumption Tax. The Japanese Tax Commission is recommending that the rate should double, multiple rates should be employed, and the "bookkeeping method" of accounting should be abandoned in favor of the European "invoice method."

The Tax Commission faces a tax policy dilemma. The aging population drives the need for a tax increase (making the Consumption Tax an obvious target for revenue enhancement) at exactly the same time the population is shrinking in overall size, thereby reducing the number of working-consumers who can pay the higher tax.

These are dramatic changes for the Japanese …

Biometrics: Solving The Regressivity Of Vats And Rsts With 'Smart Card' Technology, Richard Thompson Ainsworth

Faculty Scholarship

Biometric identifiers embedded in national identity cards puts a formerly impossible goal of consumption taxation within the grasp of policymakers for the first time. Never before has it been possible to design a broad-based, single rate consumption tax that is truly progressive.

No consumption tax has ever had all three of the critical attributes of a progressive consumption tax: a broad base, a single rate, and measured relief for those in greatest need. Although economists have urged that a broad base and a single rate be pursued over progressivity, most consumption taxes instead seek progressivity at the expense of both …

Carousel Fraud In The Eu: A Digital Vat Solution, Richard Thompson Ainsworth

Faculty Scholarship

Recent reports from the UK's Office for National Statistics estimate (as of May 11, 2006) that Missing Trader Intra-community Fraud (MTIC) may exceed 10 billion pounds this year.

Carousel fraud, a variant of MTIC where the same goods are sold over and over again, exploits the lingering non-certified, non-digital attributes of the EU VAT. The UK believes that carousel fraud cost the Exchequer between 1.12 and 1.9 billion pounds in the 2004-05 financial year. This article proposes that carousel fraud be eliminated in the EU through selective insertion of Digital VAT functionality into the present system. In other words, it …

Governing By Negotiation: The Internet Naming System, Tamar Frankel

Faculty Scholarship

This Article is about the governance of the Internet naming system. The subject is fascinating, not simply because the naming system is an important system affecting the Internet, although it is; and not because the Internet is important, although it is. The subject is fascinating because it offers a rare opportunity to examine and learn from the evolution of an incoherent governance structure. The naming system is special in that it is the product of a new technology; it reflects the changes and pressures brought by the new technology, and involves the interests of government and private entities, domestic and …

Bargaining In The Shadow Of Copyright Law After Tasini, Maureen A. O'Rourke

Faculty Scholarship

Copyright law often provides the background rules against which bargaining over rights in works of information takes place. By granting creators of works of authorship certain exclusive rights and providing protection against infringement of those rights, copyright law effectively gives authors bargaining chips to use in negotiations with those who would exploit their works in some way. Generally, however, copyright law does not explicitly address imbalances in bargaining power that affect the division of the surplus between the parties to a copyright license. When the would-be exploiter of the copyrighted work wields some degree of market power or brings significant …

The Magic Lantern Revealed: A Report Of The Fbi's New Key Logging Trojan And Analysis Of Its Possible Treatment In A Dynamic Legal Landscape, Woodrow Hartzog

Faculty Scholarship

Magic Lantern presents several difficult legal questions that are left unanswered due to new or non-existent statutes and case law directly pertaining to the unique situation that Magic Lantern creates. ²⁵ The first concern is statutory. It is unclear what laws, if any, will apply when Magic Lantern is put into use.²⁶ The recent terrorist attacks in the United States have brought the need for information as a matter of national security to the forefront. Congress recently passed legislation (i.e. USA PATRIOT Act) ²⁷ that dramatically modifies current surveillance law, thus further complicating the untested waters of a …

Trusting And Non-Trusting On The Internet Symposium: Trust Relationships, Tamar Frankel

Faculty Scholarship

The Puzzle: The Internet is a wonderful innovation, allowing people around the world to communicate, trade, and obtain services. Convenient and rich in choices and opportunities, the Internet is tremendously attractive to buyers. Naturally, businesses are flocking to the Internet. The warning has been sounded that those who do not stake a claim in this incredible new communication medium will be left behind to perish. Yet, with all the enthusiasm, many buyers hesitate to take a serious plunge. Businesses are told repeatedly that they must obtain their customers' trust, yet find it more difficult to gain this trust in cyberspace …