Jul 6, 2022 • 8M

🗞️ EPA Loses Power over Carbon Emissions, Google's new Settlement, & TikTok's Project Texas

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This week: SCOTUS strikes down on federal regulation, Alphabet tries to quell antitrust chatter, and TikTok wants to put Republican Senators at ease. Plus, sensitive location history is wiped, and the ownership of color.

🏭 SCOTUS Takes a Seat at the Regulatory Table

At the end of a momentous two weeks for the United States Supreme Court, the conservative justices, in a 6-3 decision, ruled that the EPA has no authority to create new regulations on carbon emissions as that is only a power Congress can exercise. If this ruling seems limited to pollution, think again: this decision opens the door to a host of challenges against federal agencies and their regulations, including on health, safety, consumer protections — and even crypto.

  • Chief Justice Roberts writes in the majority opinion that the EPA violated the so-called “major-questions” doctrine, because “if Congress wants to give an administrative agency the power to make 'decisions of vast economic and political significance,' it must say so clearly,” notes SCOTUSblog.

  • In her dissenting opinion, Justice Kagan (alongside Justices Sotomayor and Breyer) raised an urgent warning that “stakes here are high” in fighting climate change, and that the majority's ruling “prevents congressionally authorized agency action to curb power plants’ carbon dioxide emissions. The Court appoints itself — instead of Congress or the expert agency — the decision-maker on climate policy. I cannot think of many things more frightening.” 

The Crypto Application

With its broad ruling that a federal agency needs express authority from Congress to make “decisions of vast economic and political significance,” the FDA, SEC, and other agencies may have to begin acting with more caution before issuing new rules. “If the SEC is thinking about taking steps to regulate how cryptocurrency works, or how it’s exchanged, SEC attorneys are going to look at this opinion and say, let’s make certain that this court, as well as district courts and appellate courts across the country, aren’t going to think, 'Oh, this looks like a really big exercise of authority,” Blake Emerson, a professor at the UCLA School of Law, told Marketplace. “The problem with this ruling and rulings like it is that the court is taking away that policymaking power. And that is something to worry about, because the court does not have the same expertise as the agencies. And it does not have the same political accountability. You can’t fire federal judges.”

The Verdict

Removing the teeth of regulatory agencies in favor of a paralyzed Congress is a major win for proponents of deregulation. It'll be interesting to see what new lawsuits (against the FDA, CFPB, SEC, and more) will amass in the wake of this ruling.

🎧 What We’re Listening To

This week, we’re listening to Joe Thornalley, a British producer, DJ, and graphic designer from London known as Vegyn. Wholly untraditional, his skittering and soft beats have gained attraction from both James Blake and Frank Ocean. And after having the chance to collaborate with Frank on Blonde and Endless, he released his first mixtape in 2019 — Text While Driving If You Want to Meet God!. At 71 tracks, it has a nearly 90-minute run rate, with titles just as obscure as the music.

Text While Driving If You Want to Meet God! - Vegyn

Apple Music / Spotify / YouTube Music / Amazon Music

💸 An Alphabet That Begins with Settlement

Google and its parent company Alphabet know that the political tides are shifting on Big Tech and that antitrust actions are ramping up. With that in mind, the Internet titan has offered $90 million to settle a class-action lawsuit brought against it by small app developers alleging Google's Play Store violated federal antitrust regulations. Specifically, the suit claimed that listing on the Play store required small app users to process payments through Google's proprietary payment platform, which then charged a 30% fee. Google initially responded to this suit by lowering the fee to 15% on the first million dollars. 

  • The minimum pay-out developers will get from this settlement is $250, but could be as much as $200,000.

  • Hagens Berman, the firm representing the 48,000 small app developers in the suit, said in a statement: “With this settlement, developers will have more room to grow and more money in their pockets to promote their hard efforts.”

The Growing Antitrust Debate

Across Europe and the United States, Alphabet (along with Big Tech in general) is coming under increasing regulatory pressure and calls to break up the mono/duo/oligo-polies held by Silicon Valley. In the UK, the country's Competition and Markets Authority (or CMA) called out Google for its “effective duopoly” (along with Apple) of the mobile ecosystem. “App developers also have to comply with Apple and Google’s rules for access to their app stores, which some say are overly restrictive,” the CMA wrote in a December 2021 statement. “Developers are required to accept these terms in order to reach users, which can include paying 30% commissions to Apple and Google.” In June, the CMA began looking into potential investigations it would launch into Google that may result in formal charges, fines, and new rules, reports Engadget. Similar actions are underway in the EU, and the US Senate is reviewing a proposed antitrust bill against Big Tech.

The Verdict

Clearly, Google is trying to make concessions on smaller cases to look better in the eyes of politicians, judges, and regulators when it comes down to fights on the bigger issues. Only time will tell how well this tactic will work.

🎆 Let the Fireworks Commence

We’re launching some pretty cool events this July, and you shouldn’t miss any of the shows.

  • How to Manage Multiple Clients | July 12th, 2 pm ET / 11 am PT

Join former successful Lawtrader, Shahrzad Kojouri (Commercial Counsel, Hopin) as she shares her secrets on managing multiple clients, from setting expectations, to useful software, to how she had fun while doing it!

👉 RSVP here!

  • Let’s Talk Legal in esports | July 14th, 3 pm ET / 12 pm PT

We’re back with yet another run in our innovators series! This time, we’re talking to Tammy Brandt (CLO, FaZe Clan) about the fascinating world of eSports.

👉 RSVP here!

  • How to Avoid Burnout | July 26th, 2 pm ET / 11 am PT

Join us in conversation with Bree Buchanan (Board President, Institute for Well-Being in Law) as she shares her experiences and practical tips for staying at the top of your game while taking care of your mental health and well-being.

👉 RSVP here!

  • Challenging the Gender Pay Gap | July 28th, 3 pm ET / 12 pm PT

Join us to hear from pros Megan Elizabeth Gray (legal thought leader, ex-Condé Nast) and Maureen Frangopoulos (Senior Legal Director, Uber) as they discuss how we can shrink the pay gap in legal, with practical tips and takeaways.

👉 RSVP here!

👀 P.S. don’t forget about our panel tomorrow afternoon where we’ll discuss how legal can prepare for an economic downturn. Join in on the conversation here.

🔐 The Clock is Ticking on "Project Texas"

Have no fear: Project Texas is here. So says TikTok to Americans worried about the privacy of their data on the hyper-popular social media app. The message came in the form of a letter TikTok sent to Republican senators after those senators sent a letter to the Chinese firm last month with concerns that they have “long suspected” that TikTok (and its parent, ByteDance) have been using “their access to a treasure trove of U.S. consumer data to surveil Americans.” In his response letter, TikTok CEO Shou Zi Chew wrote that Project Texas “will fully safeguard user data and U.S. national security interests.”

Meta's Smear Campaign

Whether the fear over TikTok's access to US consumer data is founded or not, it echoes a smear campaign that came to light earlier this year. In March, the Washington Post reported that Meta (Facebook's parent company) had hired Targeted Victory, a Republican consulting firm, to “sway public opinion against TikTok” by publishing news stories to play into these data privacy fears.

The Verdict

TikTok had already begun migrating its US-based data onto Oracle's cloud, but the move coincided perfectly with the Buzzfeed article and the Senators' letter. Still, it remains unclear if the move will actually change any privacy or national safety issues.

📤 What Else We're Forwarding

Locations to Be Removed: Google has announced in the wake of Roe v. Wade being overturned that it will scrub its users' location data of visits to abortion clinics and other “particularly personal” places, says Engadget. Among the list of other locations to remove from a user's history are counseling centers, domestic violence shelters, fertility centers, addiction treatment facilities, weight loss clinics, and cosmetic surgery clinics. 

Red (TM): Are specific colors (say the robin egg blue of a revered jewelry box or the specific shade of brown you'd find on a ubiquitous delivery truck) part of a company's IP, wonders The Hustle. Some companies have begun suing over the use of colors (even though Pantone has less than 2,000 total colors) citing trademark infringement.

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See ya next week!

✌🏽 Raad