The UC Law Review Forum

Ryan Kenny, Associate Member, University of Cincinnati Law Review

 On June 24, 2016, House Speaker Paul Ryan (R-WIS) and Kevin Brady (R-TX), Chairman of the Ways and Means Committee, released a Blueprint outlining their proposed tax reform. The Blueprint is titled A Better Way: Our Vision for a Confident America (Blueprint).[1] The Blueprint details proposed reforms to the tax system, for individual taxation, pass-through entity taxation (such as partnerships and LLCs), and corporate taxation.[2] The individual and pass-through entity tax reform proposal consist primarily of reductions in the top marginal tax rates, and the reduction of the current seven-tax-bracket system for individual taxation, into a three-tax-bracket system.[3] Pass-through entities would have a top marginal rate of 25%.[4] Furthermore, the capital gains tax rate will match ordinary income rates, rather than the current special rates in the Internal Revenue Code (Code) §1(h).[5] However, the changes to corporate taxation are the most seismic. Not only are the top marginal rates reduced for corporations, but the underlying theories on U.S. jurisdiction to tax corporate incomes is set to change dramatically under the proposed reform. It is important to understand how corporations are currently taxed in the United States under federal income tax law. Then, the changes proposed in the Blueprint will be explained to show the changes. Any possible economic repercussions are beyond the scope of this analysis. This analysis will only cover corporations that are incorporated under state law in the United States, not foreign resident and nonresident corporations. Continue reading →

Meg Franklin, Associate Member, University of Cincinnati Law Review

Introduction

In a recent case, Or. Rest. & Lodging Ass’n v. Perez, the Ninth Circuit considered whether precedent foreclosed the Department of Labor’s (DOL) ability to promulgate a formal rule.[1]  On appeal, the Ninth Circuit found that the DOL was within its authority to promulgate its regulation.[2]  The dissent disagreed and insisted that the Ninth Circuit precedent overrides the DOL regulation.[3]  Its analysis considered whether the statute was clear and unambiguous and an agency’s scope of power to promulgate rules under an ambiguous statute.[4]

In Perez, the majority and minority were divided over whether the judiciary or an agency should fill in blanks left by Congress.[5]  Yet, a third option has arisen in the form of a House of Representatives bill.[6]  Under the Regulations from the Executive in Need of Scrutiny Act of 2017 (REINS), all significant blanks found in statutes would be filled in by Congress.[7]  In other words, REINS would cancel any major regulations that do not receive explicit approval from Congress.[8]  Continue reading →

Author: Anonymous, Associate Member, University of Cincinnati Law Review

The 2016 Presidential election shocked many, and for many reasons. In particular, following the election, countless experts and analysts recognized their failure to appreciate the power and influence of social media platforms over the election. Given the exponential growth of social media, combined with the Millennial generation’s maturity into adulthood and eligibility to vote, it became clear that our political landscape was changing.

Indicative of the unchartered collision of social media and Presidential election was the introduction of the “ballot selfie” to our modern vocabulary. On October 24th, 2016, singer Justin Timberlake took a photo of himself, hereafter referred to as a “selfie,” inside the voting booth at a Shelby County, Tennessee, polling location.[1] Mr. Timberlake shared the photo on the social media platform Instagram.[2] Along with the photo, Mr. Timberlake urged everyone to vote and referenced “Rock the Vote,” the popular celebrity endeavor to encourage young voter turnout.[3] Unbeknownst to Mr. Timberlake, Tennessee had recently passed a new law that “use [of] a mobile device of any kind to take pictures, video or to make a phone call with that device inside polling places” is illegal.[4] Although later retracted, the Shelby County District Attorney’s Office said that Mr. Timberlake’s ballot selfie was under investigation for illegal activity.[5]

Unsurprisingly, the warning from the District Attorney took many off guard because so few citizens know the intricacies of the law that govern them. Many news outlets covered the story and it became clear that the laws covering “ballot selfies” varied significantly across the country. However, this lack of uniformity may be unsustainable because social media is about expression and regulation of speech, especially political speech, is not taken lightly by our First Amendment jurisprudence.

The Exploding Popularity of Social Media

Nearly 70% of adult Americans own a smartphone, with that number jumping to 86% among Americans aged 18-29.[6] Unsurprisingly, mobile devices equipped with internet or data capabilities, such as smartphones, have contributed to the exponential growth of social media usage; constant access and ease of use, made possible by smartphones, has permitted social media to become a powerful force within our society. With a combined 2.1 billion users, Facebook, Instagram, and Snapchat are a few of the most popular social media platforms, and all are used heavily for the sharing of photographs.[7] Snapchat is relatively new to the social media scene, whereas Facebook and Instagram have been around long enough to report user data. Since 2011, Facebook grew from 845 million users to 1.5 billion users and Instagram grew from 15 million users to 400 million users.[8] Currently, Snapchat has 150 million users.[9]

Political speech: Millennial’s Changing the Political Forum

Given the explosion of social media use, political speech encompasses more mediums more than ever. Specifically within the Millennial generation, social media platforms constitute a significant forum for political discussion and expression.[10] The Millennial generation is the first generation to have grown up with computers, where effortlessly using technology is second-nature. As the Millennial generation has aged into adulthood, with Millennials ranging in age from 19-35 years old,[11] social media has become a driving force in tapping into the economic, social, and political power of the generation. At the time of the first Presidential debate between Hillary Clinton and Donald Trump, the debate was the most “tweeted” debate ever with over ten million “tweets” submitted on Twitter over the course of the ninety minute debate.[12]

After the election, it became clear that President Trump’s early harnessing of the power of social media has been attributed as one of the driving forces behind his success in the 2016 presidential election.[13] With over 90% of Millennials using at least one form of social media, the impact of social media on our political landscape is undeniable.[14]   

Ballot Selfies and the First Amendment: Will States Lose Control over the Election Process?

In the aftermath of Mr. Timberlake’s near brush with the law, countless news outlets covered the story, either clarifying the local laws pertaining to their audience or calling for nationwide reform to make the election laws governing social media uniform. Indeed, the laws governing the sharing of photographs, or selfies, taken during voting or of one’s ballot vary significantly across the country. Even locally, within the tri-state[15] area surrounding the University of Cincinnati College of Law, the laws differ. In Ohio, state law prohibits sharing a ballot that has been marked “with the intention of letting it be known how the elector is about to vote”.[16] Whereas in Kentucky and Indiana, there are no restrictions on sharing photos of oneself at the polling location or of the ballot.[17] Yet in Pennsylvania, each county can set its own rules governing the sharing of photos.[18] This lack of uniformity has prompted states to recognize that their ballot laws are anachronistic, misplaced in our society’s current practice of documenting and sharing every moment of our day on various social platforms.

Under the Article 1 of the Constitution, states have control over the process in presidential election, which accounts for the lack of uniformity amongst the states on the legality of “ballot selfies.”[19] However, the constitutionality of the bans on “ballot selfies” have made their way to the courts, on First Amendment grounds, and social media giants are entering the fray.[20] Snapchat filed an amicus brief in Rideout v. Gardner, an appeal pending in the First Circuit, agreeing that New Hampshire’s ban on “ballot selfies” is a content-based restriction on free speech and urging the Court to recognize that “ballot selfies” are a “uniquely powerful form of political expression.”[21] Proponents of the ban on “ballot selfies” argue that the photographs jeopardize the integrity of the secret ballot, create a more dangerous polling environment, and create a situation ripe for vote-buying.[22] In its amicus brief, Snapchat rejects those arguments as unfounded and instead offers that states which ban “ballot selfies” are more interested in regulating “the effect that such a powerful and novel form of political expression may have.”[23]

In the end, the First Circuit correctly held that the ban on “ballot selfies” was an impermissible restriction on free speech.[24] Speculation on the part of those supporting the ban, including a lacking of demonstrable harm, swayed the Court to hold the ban unconstitutional.[25] However, given the immense popularity of social media, the First Circuit will not be the only court to address this issue. Currently, twenty-one states and the District of Columbia permit “ballot selfies.”[26] Whereas seventeen states explicitly ban “ballot selfies” and twelve have not taken a stance on the legality of such photographs.[27] Crookston v. Johnson, a case before the Sixth Circuit, upheld the ban temporarily by staying an injunction on the ban. [28] Crookston might create a split between the Circuit Courts.

Conclusion

Now that the 2016 election has passed, federal courts and state legislators must consider the legality of “ballot selfies.” Given that the “ballot selfie” is a form of political expression, and First Amendment protections have been implicated, state control over the election process might be lessened by federal court rulings. If a split among the Circuit Courts ensues, the issue may find its way to the Supreme Court. Without a clear justification for banning such a form of political speech, bans on “ballot selfies” are unlikely to pass a strict scrutiny review. With four more years until our next Presidential election, there is no better time for the courts to address the issue.            

[1] Madeline Farber, Justin Timberlake Avoids Jail Time after Taking a Ballot Selfie in Memphis Fortune.com (2017), http://fortune.com/2016/10/27/just-timberlake-ballot-selfie/ (last visited Jan 16, 2017).

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Monica Anderson, Technology Device Ownership: 2015 Pew Research Center: Internet, Science & Tech (2017), http://www.pewinternet.org/2015/10/29/technology-device-ownership-2015/ (last visited Jan 16, 2017).

[7] The Continued Growth of Social Media [Infographic] | SEJ, Search Engine Journal (2017), https://www.searchenginejournal.com/growth-social-media-v-3-0-infographic/155115/ (last visited Jan 16, 2017).

[8] Id.

[9] More Frier, Snapchat Passes Twitter in Daily Usage Bloomberg.com (2017), https://www.bloomberg.com/news/articles/2016-06-02/snapchat-passes-twitter-in-daily-usage (last visited Jan 16, 2017).

[10] Jeff Fromm, New Study Finds Social Media Shapes Millennial Political Involvement And Engagement (2017), http://www.forbes.com/sites/jefffromm/2016/06/22/new-study-finds-social-media-shapes-millennial-political-involvement-and-engagement/#21cc1cc615de (last visited Jan 16, 2017).

[11] Richard Fry & Richard Fry, Millennials overtake Baby Boomers as America’s largest generation Pew Research Center (2017), http://www.pewresearch.org/fact-tank/2016/04/25/millennials-overtake-baby-boomers/ (last visited Jan 16, 2017).

[12] Second Trump-Clinton presidential debate most tweeted ever, (2017), http://www.deccanchronicle.com/world/america/101016/second-trump-clinton-presidential-debate-most-tweeted-ever.html (last visited Jan 16, 2017). Twitter is an immensely successful social media platform on which users can “tweet” a message that contains up to 120 characters.

[13] Brian Stelter, Monday night ranks as the ‘most tweeted debate ever’ CNNMoney (2017), http://money.cnn.com/2016/09/27/media/debate-social-media-twitter-facebook/ (last visited Jan 16, 2017).

[14] How Millennials use and control social media, American Press Institute (2017), https://www.americanpressinstitute.org/publications/reports/survey-research/millennials-social-media/ (last visited Jan 17, 2017).

[15] The tri-state includes Ohio, Kentucky, and Indiana.

[16] Michael Huson & Campus Editor, Ohio voters better off keeping ‘ballot selfies’ at arm’s length, officials say Thelantern.com (2017), http://thelantern.com/2016/11/ohio-voters-better-off-keeping-ballot-selfies-at-arms-length-officials-say/ (last visited Jan 16, 2017).

[17] Justin Timberlake can take all the ballot selfies he wants in Indiana, Indianapolis Star (2017), http://www.indystar.com/story/news/politics/2016/10/26/justin-timberlake-can-talk-ballot-selfies-wants-indiana/92763782/ (last visited Jan 16, 2017).

[18] Id.

[19] Voting and Election Laws | USA.gov, Usa.gov (2017), https://www.usa.gov/voting-laws (last visited Jan 16, 2017).

[20] Daniel Victor, Selfies in the Voting Booth? Snapchat Fights for the Right Nytimes.com (2017), http://www.nytimes.com/2016/04/27/us/politics/voting-booth-snapchat-selfies.html?_r=0 (last visited Jan 16, 2017).

[21] Brief for Snapchat as Amicus Curiae, p. 5, Rideout v. Gardner, 838 F.3d 65 (2016).

[22] Id. at 10-15.

[23] Id. at 15.

[24] Rideout v. Gardner, No. 14-cv-489-PB, Memorandum and Order, at 1 (D.N.H. Aug 11, 2015).

[25] Id.

[26] Want to take ‘ballot selfie’? Here’s where it’s legal, and not, USA TODAY (2017), http://www.usatoday.com/story/tech/news/2016/11/06/ballot-selfie-beware-s-often-illegal-despite-flurry-late-attempts-change/93299316/ (last visited Jan 16, 2017).

[27] Id.

[28] Crookston v. Johnson, 841 F.3d 396 (6th Cir. 2016). The Court in Crookston was primarily concerned with the timing of the case because it came directly before the 2016 election, giving Michigan little time to reconcile a ruling.

Author: Alexander Spaulding, Associate Member, University of Cincinnati Law Review 

                                                             Introduction

The legalization of recreational and medicinal marijuana is experiencing a domino effect across the states. However, as a larger portion of the country is coming around to the idea of legalized marijuana, some states are significantly behind. Indiana has some of the most draconian marijuana laws in the country, where medical marijuana is illegal, and where possession of a single joint could support a year-long prison sentence and up to a $5,000 fine.[1] With recreational and medicinal use off the table, Indiana resident Bill Levin is fighting for a third option to legally use cannabis—sacramental use.[2] A core tenant of Levin’s First Church of Cannabis is the use of marijuana for religious, spiritual, and healing purposes.[3] Levin argues that the state is placing a substantial burden on the church’s free exercise of religion, by threatening to prosecute its members for partaking in religious practices.[4] This is not the first time that a plaintiff has attempted to circumvent drug laws through the freedom of religion. Employment Division v. Smith,[5] is a landmark case in which the Supreme Court ruled that Oregon did not have accommodate the use of peyote by members of the Native American Church, because its prohibition of peyote was neutral and generally applicable.[6] In response, Congress enacted the Religious Freedom Restoration Act[7] (RFRA) that mandates strict scrutiny be applied to federal governmental action that substantially burdens individual religious exercise.[8] The analysis begins with determining what a substantial burden is.

Substantial Burden

The Ninth Circuit dealt with defining a substantial burden in Oklevueha Native American Church of Hawaii, Inc. v. Lynch.[9] The Oklevueha court held that Controlled Substances Act[10] (CSA) was not a substantial burden upon the church’s religious ceremonies that included the use of marijuana.[11] The court’s holding raises created ambiguity regarding what constitutes a substantial burden. After Oklevueha, it is uncertain whether the analysis turns on the importance of the practice to the religion, the extent of the restriction by the government, or both.

The Case

Michael Rex Mooney founded the Oklevueha Native American Church, where members, through sacrament, use marijuana, peyote, and many other controlled substances to “experience a connection with the divine.”[12] In 2009, the church filed suit against several federal officials in response to a seizure of cannabis,[13] in order to protect itself from sanctions under the CSA. The Ninth Circuit heard the plaintiff’s claim under the RFRA, but granted summary judgment to the government because the church failed to demonstrate that cannabis was necessary for its practice of religion, or that the CSA was a substantial burden.[14] The court explained that cannabis was not necessary for the practice of the church’s religion, by the plaintiff’s own admission, because it was used as a substitute for peyote, and other drugs could be used in its place.[15] Furthermore, they failed to allege that cannabis served a specific function in their religion.[16]

The church argued that under Hobby Lobby, [17] the “court must not decide the plausibility of a religious claim,” and therefore the court cannot deny the church its use of cannabis through discrediting the church’s religious belief.[18] In Hobby Lobby, a group of Christian store-owners sought freedom from a mandate that required them to provide contraceptives to their female employees through company healthcare.[19] The court ruled that the store-owners did not have to provide the contraceptives, because it was not the least restrictive (upon the store-owners’ religious freedom) means to provide contraception to the female employees.[20] Thus, the Hobby Lobby court protected the religious freedom to forego supplying contraceptives, and the court upheld that the religious belief was plausible, without challenge. However, the Oklevueha court explained that it was not inquiring into the plausibility of the church’s claim, but rather denied the claim based on the church’s own admission that it did not believe that specifically cannabis was a religious necessity, but a “substitute drug,” that was used alongside peyote, the true religious necessity.[21]

The Oklevueha Interpretation of Substantial Burden

While a “substantial burden” can be construed as excessive governmental pressure to violate one’s own religious beliefs, as was the case in Hobby Lobby, where the government imposed a hefty fine on the store-owners, the Oklevueha court interpreted a substantial burden based on the importance of the practice. In this case, the use of marijuana was not found to be integral to the practice of religion, and the court ruled on those grounds that the burden was not substantial. Therefore, under Oklevueha, the government is free to doll out harsh penalties such as hefty fines or jail time, without the harshness being accounted for in the level of burden upon plaintiffs, as long as the state is not impinging upon a highly important, or mandatory religious practice. Thus, the crux of Oklevueha is the mandatory nature of the practice, not necessarily the plausibility.

The Consequences

In this case, the government was found to not have imposed a substantial burden upon the Church of Oklevueha. However, the ruling arguably makes it more likely that a RFRA challenge to the illegality of cannabis will be successful in the future, because the court focused too heavily on mandatory nature of cannabis use, which may be used to a plaintiff’s advantage in the future. Now, plaintiffs know that they must plead that cannabis is a mandatory part of their religion. The government’s primary concern in these cases is that the alleged religious ceremonies are merely a pretext for breaking the law and avoiding prosecution. In Oklevueha, the court acknowledges the holding in Hobby Lobby that essentially bars the court from subjectively deciding that the alleged religious conduct is pretext. While the court was able to move past this issue in Oklevueha because the plaintiffs admitted that cannabis use was not mandatory, future courts may not have such an easy time dodging the issue if the plaintiffs plead differently. Without the authority to subjectively decide that the cannabis use is not mandatory, any legal burden upon a plaintiff’s religious freedom will be harder to prove unsubstantial. 

Conclusion

The First Church of Cannabis is set to have trial in November 2017.[22] In the wake of Hobby Lobby and Oklevueha, what appears to be a blatant pretext to circumvent Indiana’s strict marijuana laws appears to have a surprisingly promising outlook. If Bill Levin can avoid the crucial mistake that the Church of Oklevueha made in admitting that their use of cannabis was not mandatory, then the First Church of Cannabis could be primed for a run to the Supreme Court. Fortunately for Levin, his church is named after cannabis, this should make for a compelling argument that the drug is obligatory for the practice of the faith. If the court remains true to its precedent from Hobby Lobby, as restated in Oklevueha, the court may have to rule that marijuana is legal in Indiana, but only when used for sacramental purposes.

[1] Indiana Laws & Penalties, NORML http://norml.org/laws/item/indiana-penalties-2.

[2] Stephanie Wang and Michael Anthony Adams, Church of Cannabis Suit Raises Religious Liberty Issues, Indy Star, (July 8, 2015).

[3] Mark Alesia, Cannabis Church Stays Optimistic About Laws, Indy Star, (Nov. 27, 2016).

[4] Id.

[5] 494 U.S. 872 (1990)

[6] Id. at 878-79.

[7] 42 U.S.C. §§ 2000bb to 2000bb-4 (2012).

[8] See Burwell v. Hobby Lobby Stores, Inc., 134 S. Ct. 2751, 2761 & n.3 (2014).

[9] 828 F.3d 1012 (9th Cir. 2016).

[10] 21 U.S.C. §§ 801–904 (2012).

[11] Oklevueha, 828 F.3d at 1016

[12] Id. at 1016.

[13] Id. at 1014.

[14] Id. at 1018.

[15] Id. at 1016.

[16] Id.

[17] 134 S. Ct. 2751 (2014).

[18] Oklevueha, 828 F.3d at 1016.

[19] Hobby Lobby, 134 S. Ct. at 2775.

[20] Id.

[21] Oklevueha, 828 F.3d at 1016.

[22] See Alesia, supra note 3.

Author: Melanie Navamanikkam, Associate Member, University of Cincinnati Law Review
On the heels of a Presidential election, Americans contemplate the President-elect’s promise to deport three million undocumented immigrants.[1] While concerns of xenophobia and fairness for families with undocumented family members have geared immigration advisors and ‘safe haven’ cities to vocally express their opposition,[2] the President-Elect’s proposal presents an opportunity to explore issues within immigration law that have troubled immigration courts for decades.

The grant of Due Process rights during immigration proceedings is a matter of great public interest. Embedded within the already complicated matter is a faction that concerns the Due Process rights to immigration proceeding respondents who are mentally incompetent.[3] When adjudicating cases involving incompetent respondents, immigration judges are challenged to use limited regulations and undeveloped case law in their efforts to provide the fundamental fairness rights guaranteed by the Due Process Clause.[4] American immigration laws, now more than ever, would benefit from a uniform framework that immigration judges can follow when hearing cases involving respondents with mental competency issues. Continue reading →

Meg Franklin, Associate Member, University of Cincinnati Law Review

The past year has been notable in the area of the First Amendment and trademark law.  Yet, the most noteworthy case is expected to be decided by the Supreme Court during the summer of 2017.[1]  In that case, Lee v. Tam, the Supreme Court will decide whether the United States Patent and Trademark Office (USPTO) can refuse to register marks that “disparage” people.[2]  The Court recently granted certiorari after the Federal Circuit held this practice to be an unconstitutional violation of the First Amendment’s freedom of speech.[3]  Exactly one month after the Federal Circuit’s decision in In re Tam, the District Court for the Southern District of Iowa in Gerlich v. Leath permanently enjoined Iowa State University (ISU) from applying its trademark licensing guidelines in a viewpoint discriminatory manner.[4]

Both Gerlich and Tam struck down a trademark licensing practice because it encroached on free expression.  This First Amendment analysis appears on point, but the Supreme Court may see it differently when it hears the Tam case.  However, another way to view this issue is through the lens of trademark law.  First, trademarks identify the mark holder—not an administrative body—as the source of the good.  Therefore, the USPTO or a university licensing office should not be able to claim control over the mark’s registration because the office fears the public opinion regarding the mark holder will reflect badly on the office.  Second, trademarks are typically[5] only protected to the extent they protect consumers from confusion as to the source of a good.[6]  Therefore, since trademarks are source identifying and not expressive, trademarks should not be evaluated on their expressive nature. Continue reading →

Author: Andrew Fernandez, Associate Member, University of Cincinnati Law Review

The American political scene is saturated with debates over restrictions on the right to vote or campaign finance reform during this election cycle. These debates touch on the fundamental right of freedom of speech and the debate on how to balance this fundamental right with the state’s interest in preserving integrity in our elections. The Supreme Court ruled “severe burdens on speech trigger an exacting standard in which regulations must be narrowly tailored to serve a compelling state interest, whereas lesser burdens receive a lower review”.[1] Several states, particularly in the 1900s, established initiative measures giving the electorate the ability to initiate legislation.[2] This movement was inspired by the perceived need to combat corruption and special interests that infested politics at the time.[3] One controversial regulation adopted in some states includes the ability of the state to exclude signatures because the petition circulators are not from the state. The rationale for this type of regulation is that it helps to combat fraud and ensures courts in the state can subpoena circulators in the event that signatures are contested by the state. Others argue such laws violate freedom of speech that is especially vital when it involves political speech. This issue has been confronted by the Tenth and Eight circuit courts but the courts have diverged on the constitutionality of these laws. The Tenth Circuit’s approach is the correct one because it better protects First Amendment liberties and better balances the freedom of speech with the state’s fraud concerns. Continue reading →

Author: Adam Pitchel, Associate Member, University of Cincinnati Law Review

Recent events have indicated that the electoral process remains a vital component of American government. Keeping this system free from intimidation, fear, and coercion is necessary to maintain its integrity. As part of this effort, several states have enacted legislation that prevents voters from taking pictures of their ballots after casting their votes.[1] These statutes are designed to preserve the sanctity of the electoral system by reducing the possibility of voter intimidation.[2] More persuasively, other proponents argue that this sort of legislation helps combat bribery or vote buying.[3] Opponents of these statutes argue that they impose an improper restriction of free speech and violate the First Amendment.[4] As part of this argument, they point out that incidents of voter intimidation and coercion have reduced substantially in the late 20th and early 21st centuries.[5] Furthermore, they argue that these statutes are largely ineffective in preventing voter intimidation because people who choose to take photos of their ballots often want to make their political opinion known.[6] Opponents of these statutes incorporate a more modern understanding of the First Amendment as it relates to the electoral process while proponents cling to an outdated rationale that has little bearing on the current issues of our time. Continue reading →

Author: Alexander Spaulding, Associate Member, University of Cincinnati Law Review

Introduction

Technology advances much faster than our judicial system that evolves slowly through precedent. However, technological advances place judges in situations where they must apply the antiquated precedential law to new technology. In December, the Second Circuit faced this problem in Microsoft Corp. v. United States,[1] when it held that the government cannot compel Internet Service Providers (ISPs) to produce electronic data that is stored overseas, even by a warrant.[2] Now, Microsoft need not comply with a warrant that sought readily-accessible data, because that data was stored on servers in Ireland. The court dealt with the data as though it were any other physical object, and did not account for the differences posed by the new technology.[3] By doing so, the court failed to address the novel issue regarding data and its lack of a territorial nature, which will pose challenges to United States law enforcement in the future. However, irrespective of the court’s considerations, the outcome of treating data territorially is beneficial from a foreign policy standpoint. Thus, even though the Second Circuit missed an opportunity to rule on the novel problem presented by data, the court shored up our foreign relations.

The Novel Issue: Where is Data?

Electronic data is significantly different than physical objects because data can be both created and accessed from anywhere with an internet connection. Although data can be created and accessed from almost anywhere, data is still physically stored in server farms located all over the world.[4] Recently, there has been significant scholarly dispute regarding where data is located for jurisdictional purposes.[5] As evidenced by the ruling in Microsoft, data is currently presumed to be located at the server’s location, as evidenced by the ruling in Microsoft, which is in line with the rules of other countries.[6] However, electronic data is arguably “un-territorial,” [7] because its physical location is largely irrelevant—so perhaps data should be considered to not have a location for jurisdictional purposes. Jennifer Daskal argues, “territorial-based rules of the game are premised on two key assumptions: that objects have an observable, identifiable, and stable location, either within the territory or without; and that the location matters.” [8] Data does not comply with either of these assumptions: (1) it is constantly flowing, and (2) its physical location has no bearing on any interaction with it. Thus, the legal location of data should arguably be anywhere that it can be accessed or created.

What the Microsoft Court Addressed: Extraterritoriality

In Microsoft, a magistrate judge issued a warrant under the Stored Communications Act[9] (SCA), requiring Microsoft to produce certain emails.[10] However, some of the emails were stored on a server in Dublin, Ireland.[11] Although the question of where data is located is one of first impression[12], and despite the ongoing debate regarding the un-territorial nature of data, the Microsoft court essentially disregarded the issue because “no party dispute[d] that the electronic data subject to this [w]arrant [are] in fact located in Ireland.”[13] Nor did a party dispute that Microsoft would have to “collect the data from Ireland.”[14] Therefore, the court found no reason to address whether data was exceptional, and defaulted to treating it like a physical object, “located” where it is stored.

Therefore, the question in Microsoft became whether an extraterritorial warrant is valid under the SCA, regardless of the warrant’s intended object. The court applied the two-part test from Morrison v. Nat’l Austl. Bank Ltd., which determines whether a statute is meant to be used extraterritorially.[15] Since (1) there is no explicit text that states that the act should be applied exterritorialy, and (2) the proposed use of the statute was not extraterritorial, the court found that the SCA does not apply extraterritorially.[16] The court found no reason to override the strong congressional presumption against the extraterritorial application of statutes.[17] Then, the court found that enforcing the warrant would be an extraterritorial application of the SCA.[18] The court reasoned that the congressional purpose of the SCA was to protect privacy, and since the privacy interest in this case was in Ireland, the warrant would apply the SCA extraterritorially, which made it invalid.[19]

Missing the Point

Although the court came to a judgment in Microsoft, the court did not address or resolve the un-territorial nature of data. Rather, the court explicitly ruled in favor of the notion that data is located on the servers where it is stored, despite never tackling the question. The court missed an opportunity to adapt to the new technology, and instead further entrenched itself in applying old law to new technology.

The Ramifications

Law enforcement officers will be severely hindered in obtaining evidence from ISPs that store their information abroad. Barring a different precedential ruling on data territoriality, there are now two paths for law enforcement to have jurisdiction over “extraterritorial” data in the future, and they come through the other branches of government. First, congress could amend the SCA to include provisions that deal with data as an exceptional circumstance. However, until that happens, law enforcement’s only option is to appeal to Mutual Legal Assistance Treaties (MLATs), which are agreements that the executive negotiates with other countries that aid in law enforcement through gathering and exchanging information. However, MLATs require bilateral action and thus often operate much more slowly.[20] Thus, the ruling means that critical information from ISPs, if it is stored overseas, may be very difficult to access under our current laws.

Other Considerations

Although the court did not consider the un-territorial nature of data, there is no guarantee that such a consideration would change the outcome of the case. First, the court could have considered the differences of data when compared to other objects, and still rejected that the difference mattered. Second, even if the court found that data is territorially unique, there is still a compelling reason to rule that seizing data stored overseas is extraterritorial and illegal—foreign policy consequences. If the United States were to authorize unilateral law enforcement intrusions into sovereign countries, it risks offending that country. Furthermore, the United States risks setting a dangerous international precedent that could allow foreign governments to unilaterally compel the production of data located in the United States through jurisdiction in its own country.[21]

Conclusion

Ultimately, considering the foreign political ramifications, the Microsoft court probably made the right decision. However, the court came to its conclusion too quickly, without addressing the debate regarding the location of data. Doing so, the court has made a precedent of dealing with data as it would deal with any physical object, something legal and technological scholars believe is outdated. The court had an opportunity to change the way data is understood, and to rule based on the unique foreign policy concerns that arise from data. Instead, the court settled for applying old law to new technology.

[1] 829 F.3d 197, 222 (2d Cir. 2016).

[2] Id.

[3] Id.

[4] Jonathan Nimrodi, 10 Facts You Didn’t Know About Server Farms, Cloudyn, (Sep. 8, 2014), https://www.cloudyn.com/blog/10-facts-didnt-know-server-farms/.

[5] See e.g. David R. Johnson & David Post, Laws and Borders — The Rise of Law in Cyberspace, 48 Stan. L. Rev. 1367, 1374-1376 (1996).

[6] The same is true in the UK; the High Court reached the same conclusion. See Jack Clark, Data Jurisdiction is Where Server is Located, Says Court, http://www.zdnet.com/article/data-jurisdiction-is-where-server-is-located-says-court/#!.

[7]  Jennifer Daskal, The Un-Territoriality of Data, 125 Yale L.J. 326, 389-391 (2015).

[8] Id. at 328-9.

[9] 18 U.S.C. §§ 2701–2712 (2012).

[10] Microsoft, 829 F.3d at 200.

[11] Id. at 201

[12] See Daskal supra note 6 at 328.

[13] Id. at 209

[14] Id.

[15] Id. at 210

[16] Id.

[17]Id. at 216

[18] Id. at 220

[19] Id.

[20] Jennifer Daskal, A New UK-US Data Sharing Agreement: A Tremendous Opportunity, if Done Right, Just Security (Feb. 8, 2016).

[21] See Daskal supra note 6 at 397.

Adam Pitchel, Associate Member, University of Cincinnati Law Review

Recent technology has changed labor markets for employers, employees, and consumers. The increase of temporary work channeled through an online or mobile-based system raises important questions about the roles and responsibilities of those working in a “gig economy.” Companies that utilize this business model such as Uber, Lyft, Handy, and Airbnb have faced criticism about classifying their workers as independent contractors rather than employees.[1] By doing so, these businesses avoid many of the responsibilities of a typical employer. For example, independent contractors are typically not entitled to anti-discrimination protections, payroll tax contributions, or healthcare benefits.[2] Proponents of this sort of business model champion the flexibility that it provides by allowing people to choose when they work.[3] Conversely, critics argue that this model merely serves to exploit laborers by collecting profits from their work while giving them little or no support.[4]

Issues regarding the applicability of the independent contractor label are currently being litigated in the state and federal court systems. Several class-action suits have been filed by current and former workers of these companies, alleging that they deserve to be categorized as employees rather than independent contractors.[5] Workers argue that their companies exercise too much control over their work product for them to be considered independent contractors.[6] It is likely that the eventual resolution of these suits will provide some guidance; however that will take a significant amount of time. Thankfully, policymakers around the country have drafted legislation that helps alleviate or interpret some of these issues. Legislators attempted to bridge the gap between service provider and worker by offering some benefits to workers while maintaining the independent contractor label.[7] By doing so, lawmakers have provided another way to resolve the question of whether certain workers and independent contractors or employees. Continue reading →