The Right to be Forgotten

By Kevan W.

   To what extent does an individual’s right to personal privacy extend to the Internet? The European Union has approached that issue with the intent of broadly accommodating an individual’s right to privacy, even allowing an individual to have the power to remove personal information from the Internet. Such a power, referred to as “the right to be forgotten”, would allow citizens of Europe to force Internet sites such as Wikipedia and Google to keep a citizen’s name or image from appearing in Internet search results and certain web postings. Advocates of the right to be forgotten contend that individuals should be able to control how their personal information is displayed on the Internet, including the ability to have that personal information deleted entirely from the Internet.

   The philosophical underpinnings of the right to be forgotten have been the basis for several lawsuits in Spain and Germany against Wikipedia and Google filed in the past two years, with individuals suing to restrict how their private information is displayed on the Internet. Those lawsuits sought to restrict various types of personal information: a plastic surgeon sued to suppress a story of alleged malpractice, a middle-school principal sued to obscure a listing of his public urination citation, and individuals convicted of murder sued to have their names deleted from Wikipedia pages that discuss the murder. The right to be forgotten would also allow individuals to force companies to delete the individual’s personal information that was obtained online, such as records of past online purchases and web browsing histories.

   Establishing a right to be forgotten would dramatically change how online companies stored and processed data in Europe. The right to be forgotten would also create free speech concerns by potentially censoring a speaker who wishes to use another person’s name or personal information, thus preventing society from receiving the information.

   The European Union is currently drafting directive legislation that would establish a right to be forgotten in Europe. While the right to be forgotten has received widespread support in Europe, it is unlikely that the United States would be as receptive to such a right to be forgotten. The difference in enthusiasm for the right to be forgotten between Europe and the United States can be traced to different approaches to both personal privacy and the importance of free speech. In Europe, the right to personal privacy is explicitly stated in the European Convention of Human Rights, and has been especially revered in post-fascist and post-communist Europe, which had a history of governments using an individual’s private information to persecute that individual.

   In contrast, the United States Constitution law does not expressly provide for a right to privacy; individual privacy has developed as a court-created doctrine where various elements of the Bill of Rights were combined to form the “sphere of privacy” discussed by the Supreme Court in Griswold v. Connecticut and Roe v. Wade. The United States, also, has the broadest free speech protection in the world, with any attempted restriction on speech reviewed by the courts with the highest level of scrutiny. While free speech is protected in Europe, it receives less protection when it conflicts with other interests, such as protecting the rights and reputation of others, public health, and morals. As a result, Europe’s decision to institute a right to be forgotten is the product of placing a higher value on personal privacy than free speech; whereas the United States’ hesitancy to adopt the right to be forgotten can be attributed to the desire to preserve free speech over personal privacy when the two values conflict.

   The right to be forgotten, however, is not without its problems, even under the European plan. It would be difficult, or impossible, for laws in Europe establishing a right to be forgotten to provide for the ability to delete information posted or stored in countries outside of the European Union. There may need to be exemptions to prevent individuals from deleting certain information that may be needed by doctors or law enforcement. There would also need to be a determination of who would be responsible for deleting private material: the party who posts the information or the party who allows access to the information? These logistical issues need to be resolved before the right to be forgotten can be implemented.

   The right to be forgotten represents a reaction to the growth of the Internet and its evolution into an entity that has the ability to perpetually store information that an individual may wish to keep private. In an attempt to retain that individual privacy, however, European policymakers have indicated they are willing to subvert the free speech rights of society to speak on the Internet. While free speech rights in Europe frequently receive less protection than they do in the United States, the right to be forgotten would severely undercut even Europe’s less-stringent free speech rights. By allowing individuals to delete personal information, the right to be forgotten gives individuals both the ability to control speech in the present and to change what was said about them in the past.

Huawei v. Motorola

By Linh V.

   On January 24, 2011, Huawei Technologies Co., Ltd., a Chinese telecommunications giant, filed a lawsuit against its partner, Motorola Solutions, Inc., an American telecommunications giant, in a United States district court to stop Motorola from disclosing Huawei’s intellectual property information and trade secrets to Nokia Siemens Networks in the process of a $1.2 billion deal between Motorola and Nokia.  This suit stirred up much discussion due to Huawei’s checkered past and its ties to China’s government.

   Huawei is a networking communications equipment supplier headquartered in China with world-wide locations.  It began in 1988 as a distributor of small telephone exchange products.  After slowly expanding distribution throughout China, in 1997, it released its first GSM (mobile phone) product.  In 1999 – 2003, it worked with IBM to undergo product development and was able to expand into the overseas market by 2001.  Now, it is the second largest supplier of mobile telecommunications infrastructure equipment in the world, behind Ericsson.  It also currently specializes in research and new technology development and holds over 50,000 patents.  In 2009, its annual sales were $21.8 billion with a net profit of $2.67 billion.

   Motorola is headquartered in Illinois.  It started in 1928 as the manufacturer of battery eliminators for car radios.  In the 1940s, it mainly sold televisions and radios and produced a hand-held radio used during World War II for communications between U.S. and its allies.  It also developed radio equipment for NASA, the world’s first large screen portable television, and the first color television picture tube.  After Motorola sold its television business to Panasonic, it started making cellular products in 1988.  Between 2007 and 2009, it suffered a $4.3 billion loss, causing the corporation to split up in January 2011 into Motorola Mobility, Inc. and Motorola Solutions, Inc. with the belief that investors will perceive two simple businesses as being more advantageous to one extremely diverse and complicated business.

   Huawei and Motorola met in 2000 and came up with a deal in which Huawei would develop and design new technologies for cell phones, sell these products to Motorola, who would then resell them to consumers under the Motorola brand.  Since Huawei was relatively new in the telecommunications market at this time and needed to expand and grow its customer base while Motorola wanted to maintain its hold on the cell phone market through new technology development, this deal was seen to be a win-win for both parties.  To date, Motorola has sold and re-branded over $878 million worth of Huawei’s equipment.

   Shortly after this deal in 2000 closed, suspicion arose that Huawei was committing espionage as a puppet of the Chinese government.  As a result, government regulatory agencies in various countries, such as the Indian Telecom Ministry, made Huawei’s ability to bid on large-scale projects in the respective countries difficult by blocking Huawei’s license bid applications.

   Problems surrounding Huawei did not end there.  In 2003, it was sued by Cisco for copying model numbers and codes that were used in Cisco routers to help consumers switch to Huawei’s cheaper versions of the routers.  The suit was settled after Huawei agreed to pull the products off the market and change the design codes.  Details of the settlement are unknown.

   In 2008, Motorola sued Lemko Corporation, sixteen individuals, and Huawei.  The sixteen individuals were previous Motorola employees who Motorola claims were simultaneously employed by Lemko for the purposes of stealing trade secrets.  One of the main employees, Hanjuan Jin, was specifically accused of transferring proprietary information from Motorola to her personal e-mail account and then to Lemko.  Her husband, Shaowei Pan, was a prior employee of Motorola as well and is also Chief Technology Officer of Lemko.  Pan was also alleged to have had met with Huawei officials while employed with Motorola.  Basically, Motorola was claiming that there was a secret relationship between Lemko and Huawei for the purposes of stealing Motorola’s trade secrets.  Currently, after having been amended numerous times, the suit is still pending.

   In 2009, as a result of Motorola’s huge loss, Motorola contacted Huawei to explore the possibility of Huawei purchasing Motorola’s wireless networks infrastructure business in which equipment and services are provided to wireless network carriers and its associated assets.  Although Huawei submitted a non-binding bid, Motorola decided to sell its business not to its long-time partner but instead to one of its long-time partner’s direct competitors, Nokia.  In July 2010, it announced the $1.2 billion transaction, which has since been approved by the regulatory antitrust bodies in the U.S. and European Union but is still pending with the Chinese Antitrust authorities (“MOFCOM”:  Ministry of Commerce of the People’s Republic of China).

   As part of the agreements between Motorola and Huawei, Motorola approached Huawei to try to obtain its consent, informing Huawei that the deal would require disclosure of some of Huawei’s confidential information to Nokia because Motorola would be transferring some of its employees to Nokia.  Huawei refused to give consent.  Motorola then tried to come up with measures to protect the confidential information, such as the “firewall” proposal in which certain employees who had access to commercially available Huawei products would remain the only employees, once transferred to Nokia, with access to that information.  Huawei found this proposal insufficient to avoid trade secret misappropriation.  Discussions between the two parties continued throughout 2010 until January 24, 2011 when Huawei filed a claim with a U.S. court.

   In accordance with its agreements, Huawei and Motorola planned to settle the dispute before the arbitration tribunal in Switzerland.  To avoid making the arbitration ineffective before it even began, Huawei requested a temporary restraining order and a preliminary injunction against Motorola and Nokia to stop the transfer of any confidential information to Nokia.  Motorola responded to the claim arguing that this action was a pretext for Huawei’s actual intent of preventing the transaction from closing, an effort in retaliation to the Lemko lawsuit that Motorola previously filed.  Huawei was granted the temporary restraining order.

   The Court heard testimony from several witnesses stating that the transfer of confidential information was not necessary to effectuate the deal and that the “firewall” proposal that Motorola previously suggested would not be effective in preventing the misappropriation of the confidential information.  In finding that (1) Huawei had a strong likelihood of success on the merits of trade secret misappropriation claims, (2) Huawei would be irreparably harmed if Nokia obtained its confidential information because it would allow Nokia to gain an unfair advantage at its expense, (3) the balance of hardships weighed in Huawei’s favor because it had a lot to lose in the disclosure of the confidential information and there was no evidence that the deal between Motorola and Nokia would fail to close without the information, and (4) the public interest would be best served by enforcing valid agreements and trade secrets to protect “standards of commercial morality,” the Court awarded Huawei the preliminary injunction and ordered that Motorola cease transfer of confidential information to Nokia.

   Since the Court did not ban the deal between Motorola and Nokia, they are still going through with it upon approval by MOFCOM who has been sitting on the application.  Some believe the Chinese government was specifically waiting for the outcome of the lawsuit before deciding on the application.  Some are concerned that this is all part of a strategy that Huawei and the Chinese government have been working on to improve its weaponry.  The more possible theory is that Huawei is in bad faith attempting to monopolize the telecommunications industry by stopping its competitors from consolidating.  Huawei has once been quoted that it will use its “rich IP and patent portfolio” to stop the consolidation of equipment vendors around the world.  By making it difficult or impossible for these competitors to combine, Huawei can assure its spot at the top of the telecommunications market.   The confidential information that Motorola was attempting to transfer to Nokia was not the type of jackpot information that would allow Nokia to dethrone Huawei.  Rather, it was mainly information given to consumers in regards to its products.  Granted, the information also included future products but the two parties could have easily reached an agreement that would include monetary compensation to Huawei. 

   Sure enough, in April 2011, Motorola and Huawei issued a joint statement announcing that both parties have agreed to dismiss their claims in courts, including the complaint that Motorola filed against Huawei in conjunction with Lemko.  In allowing Motorola to transfer its commercial agreements with Huawei to Nokia, Huawei will be compensated a fee and Nokia will be allowed to receive and use the confidential information that Huawei previously attempted to prevent disclosure of.  Financial terms of the deal were not revealed.

Ghost Shifts and IP Rights in China

By Lael S.

   There have been  many news articles discussing intellectual property issues in China and how the chines IP laws do not comport with American standards. The truth is the intellectual property laws in China are generally sufficient to protect IP rights. The problem is not the law but the implementation of the law.

   There is so much outsourcing to China for production; but, it is hard for companies to regulate conduct there. In the process of contracting out production to Chinese manufacturers, a company often entrusts their trade secrets, production methods, material sources and such to the factory in China. (Of course, if a company has reason to think their IP may not be protected, the company may instead choose to do business elsewhere.)

   The problem of the implementation of the laws in China has affected many industries. The automotive, phone, pharmaceutical and software industries have all been affected by a lack of IP enforcement in China.

   The lack of implementation that results in “ghost shifts” is responsible for much of the infringing products. A “ghost shift” is the shift that comes into the factory once it’s closed down for the night and which manufactures out even more of the product off the books. The factory may sell this “ghost shift” slot to someone else to produce a related but completely different product the factory is producing. Or it may be the same product the factory has been licensed to produce with cheaper materials substituted. However, sometimes “ghost shifts” even produce the exact same product but sell it out the back door for much less than the retail price. Many times, “ghost shifts” start when the contracting company orders the Chinese factory to stop production...and the factory doesn’t. The licensee factory will still have the molds, instruments, and know where to get the materials so they can still make the product without the licensing company ever knowing. Often times, the real product is indistinguishable from the “ghost shift” product.

   Many American companies have seen counterfeit goods trickle into the American marketplace. While there are procedures to get an injunction preventing the sale of these goods here, it is not so easy to get the Chinese courts to enforce injunctions abroad.

To deal with the problem, companies have begun to implement procedures to aid in the regulation of their production overseas. These new procedures include: inserting invisible ink dyes into the materials they use, auditing materials and costs more rigorously, or utilizing new software that monitors tagged parts on contracted orders.

   In January, President Obama and the president of China, President Hu, issued a joint statement agreeing that China will begin to enforce intellectual property rights. Future goals include taking steps to address piracy, cracking down on landlords who rent space to counterfeit rings, and working to eliminate indigenous innovation. Hopefully these new measures begin to solve the problem and ultimately provide for a stronger and more unified marketplace.

Original Newspaper Source