The Courts

AI-Generated Works Aren't Protected By Copyrights, US Judge Rules (billboard.com) 28

A U.S. federal judge "ruled Friday that U.S. copyright law does not cover creative works created by artificial intelligence," reports Billboard magazine: In a 15-page written opinion, Judge Beryl Howell upheld a decision by the U.S. Copyright Office to deny a copyright registration to computer scientist Stephen Thaler for an image created solely by an AI model. The judge cited decades of legal precedent that such protection is only afforded to works created by humans. "The act of human creation — and how to best encourage human individuals to engage in that creation, and thereby promote science and the useful arts — was ... central to American copyright from its very inception," the judge wrote. "Non-human actors need no incentivization with the promise of exclusive rights under United States law, and copyright was therefore not designed to reach them."

In a statement Friday, Thaler's attorney Ryan Abbot said he and his client "disagree with the district court's judgment" and vowed to appeal: "In our view, copyright law is clear that the public is the main beneficiary of the law and this is best achieved by promoting the generation and dissemination of new works, regardless of how they are created."

Though novel, the decision was not entirely surprising. Federal courts have long strictly limited to content created by humans, rejecting it for works created by animals, by forces of nature, and even those claimed to have been authored by divine spirits, like religious texts.

The Hollywood Reporter notes that "various courts have reached the same conclusion." In another case, a federal appeals court said that a photo captured by a monkey can't be granted a copyright since animals don't qualify for protection, though the suit was decided on other grounds. Howell cited the ruling in her decision. "Plaintiff can point to no case in which a court has recognized copyright in a work originating with a non-human," the order, which granted summary judgment in favor of the copyright office, stated.
Piracy

File-Hosting Icon AnonFiles Throws In the Towel, Domain For Sale 28

An anonymous reader quotes a report from TorrentFreak: Founded in 2011, AnonFiles.com became known as a popular hosting service that allowed users to share files up to 20GB without download restrictions. As the name suggests, registering an account wasn't required either; both up and downloading files was totally anonymous. The same also applies to BayFiles.com, an affiliated file-hosting service that was launched by The Pirate Bay. Both sites launched around the same time and shared a similar design and identical features. Both sites had millions of visitors but AnonFiles stood out with over 18 million visitors a month. This popularity didn't go unnoticed by rightsholders, who repeatedly flagged AnonFiles as a "notorious" pirate site.

Rightsholders and law enforcement authorities were not the only ones unhappy with the illegal content posted to the site. For AnonFiles' operators, it caused major problems too. The current owners purchased the site two years ago but didn't expect the abuse to be so massive that the only option would be to shut it down. According to a goodbye message posted on the site, they simply can't continue. "After trying endlessly for two years to run a file sharing site with user anonymity, we have been tired of handling the extreme volumes of people abusing it and the headaches it has created for us."

The operators tried to contain the abuse by setting up all sorts of automated filters and filename restrictions, taking thousands of false positives for granted, but that didn't help much. With tens of millions of uploads and petabytes of data, no anti-abuse measure was sufficient. And when the site's proxy service pulled the plug a few days ago, AnonFiles decided to call it quits. "We have auto banned contents of hundreds of thousands files. Banned file names and also banned specific usage patterns connected to abusive material," the AnonFiles team writes. "Even after all this the high volume of abuse will not stop. This is not the kind of work we imagine when acquiring it and recently our proxy provider shut us down. This can not continue."
The current owners have invited others to buy the domain name and give it a shot themselves.
United Kingdom

Millions of UK Voters' Data Accessible In Cyber Attack (theguardian.com) 14

The UK's Electoral Commission revealed that a cyber attack granted access to the data of 40 million voters. It went unnoticed for a year and was not disclosed to the public for an additional 10 months. The Guardian reports: The Electoral Commission apologized for the security breach in which the names and addresses of all voters registered between 2014 and 2022 were open to "hostile actors" as far back as August 2021. The attack was discovered last October and reported within 72 hours to the Information Commissioner's Office (ICO), as well as the National Crime Agency. However, the public has only now been informed that the electoral registers containing the data of millions of voters may have been accessible throughout that time.

The Electoral Commission said it was "not able to know conclusively" what information had been accessed. It is not known whether the attackers were linked to a hostile state, such as Russia, or a criminal cyber gang. The watchdog said "much of the data" was already in the public domain and insisted it would be difficult for anyone to influence the outcome of the UK's largely paper-based electoral system, but it acknowledged that voters would still be concerned.

The attackers were able to access full copies of the electoral registers, held by the commission for research purposes and to enable permissibility checks on political donations. These registers include the name and address of anyone in the UK who was registered to vote between 2014 and 2022. The commission's email system was also accessible during the attack. The full register held by the Electoral Commission contains name and address data that can be inspected by the public but only locally through electoral registration officers, with only handwritten notes allowed. The information is not permitted to be used for commercial or marketing purposes. The data of anonymous voters whose details are private for safety reasons and the addresses of overseas voters were not accessible to the intruders in the IT system.
A spokesperson for the ICO, the UK's independent regulator on data protection, said: "The Electoral Commission has contacted us regarding this incident and we are currently making inquiries."

They added: "We recognize this news may cause alarm to those who are worried they may be affected and we want to reassure the public that we are investigating as a matter of urgency. In the meantime, if anyone is concerned about how their data has been handled, they should get in touch with the ICO or check our website for advice and support."
Social Networks

Are the Reddit Protests Over? (gizmodo.com) 97

"Three of Reddit's biggest communities are no longer focused entirely on John Oliver in a form of protest against Reddit," reports the Verge.

Gizmodo argues that this means "the Reddit protest is finally over. Reddit won." Despite the infinite blackout threats, most moderators relented as the weeks rolled by. Three major holdouts were r/aww, r/pics, and r/videos, some of Reddit's largest communities that account for more than 91 million subscribers. The three subreddits reopened weeks ago but adopted rules by popular vote that prohibited content that did not feature HBO's John Oliver, rendering the forums useless for their previous purposes.

For a while, the subreddits stood strong, but r/videos was the first to backpedal, dropping the John Oliver rule but requiring all posts to feature profanity. Soon that rule was abandoned as well. Last week, the moderators of r/aww announced the John Oliver rule was over, and over the weekend r/pics quietly gave up the protest as well, as reported by the Verge. "More than a month has passed, and as things on the internet go, the passion for the protest has waned and people's attention has shifted to other things," an r/aww moderator wrote in a post about the rule change.

According to Reddark, a site that tracks the subreddit protest, 1,843 of the original 8,829 protesting communities are still dark. But most of these are small communities, and today the only protesting subreddit with over 10 million subscribers is r/fitness.

The Verge: Two other big communities have switched back, too. r/pics (with more than 30 million subscribers) had perhaps been the most visibly tied to John Oliver: Oliver himself posted a series of silly photos specifically for the community to use, and at one point, the moderators of r/pics invited Oliver to join the mod team. But sometime recently, r/pics removed any obvious trace of its connections to John Oliver; the Wayback Machine shows that r/pics was all about John Oliver as of Friday but no longer on Saturday...

r/videos (with more than 26 million subscribers) actually dropped its John Oliver rule back in June; it was replaced by a new rule that all posts needed to contain profanity in the title after a community vote. Earlier this month, the r/videos moderators reverted the rules to what they were before the protests started...

In June, more than 8,000 communities went dark to protest the API pricing, but in the weeks since, many subreddits have opened back up (some after feeling pressure from Reddit) and are operating as they did before. Many users are still disgruntled, though, and made their feelings known in July's r/Place canvas.

More than 1,800 subreddits are still private in protest, according to the Reddark tracker.

Some key passages from the moderator's announcement at r/aww: What about the protest, though; did we win? The short answer is no. The long answer is also no, as Reddit's minimal attempts at positive outreach remain overshadowed by the plethora of depressing developments...

At the end of the day, Reddit's API changes have gone into effect. They did not extend the transition period or reduce the exorbitant prices. They granted exemptions to a few apps and moderation tools, but that's about it. The best thing I can say is that they did honor their commitment to ensuring the continued functionality of some mod tools... Despite some reassurances and promises from Reddit, their conduct and these changes have driven away many developers, leading to the shutdown of some tools and an uncertain future for others.

The announcement with a link labeled "and more importantly," which leads to a picture with a message for Reddit CEO Steve Huffman (who uses the name "Spez" when posting on Reddit.)
The Almighty Buck

Internet Providers That Won FCC Grants Try To Escape Broadband Commitments (arstechnica.com) 75

An anonymous reader quotes a report from Ars Technica: A group of Internet service providers that won government grants are asking the Federal Communication Commission for more money or an "amnesty window" in which they could give up grants without penalty. The ISPs were awarded grants to build broadband networks from the FCC's Rural Digital Opportunity Fund (RDOF), which selected funding recipients in December 2020. A group calling itself the "Coalition of RDOF Winners" has been meeting with FCC officials about their requests for more money or an amnesty window, according to several filings submitted to the commission.

The group says broadband construction costs have soared since the grants were announced. They asked for extra money, quicker payments, relief from letter of credit requirements, or an amnesty window "that allows RDOF winners to relinquish all or part of their RDOF winning areas without forfeitures or other penalties if the Commission chooses not to make supplemental funds available or if the amount of supplemental funds the Commission does make available does not cover an RDOF Winner's costs that exceed reasonable inflation," a July 31 filing said.

A different group of ISPs urged the FCC to reject the request, saying that telcos that win grants by pledging to build networks at a low cost are "gaming" the system by seeking more money afterward. So far, the FCC leadership seems reluctant to provide extra funding. The commission could issue fines to ISPs that default on grants -- the FCC recently proposed $8.8 million in fines against 22 RDOF applicants for defaults. The Coalition of RDOF Winners doesn't include every ISP that was granted money from the program. But exactly which and how many ISPs are in the coalition is a mystery.

The Military

Biden Reverses Trump Decision, Keeps Space Command In Colorado (politico.com) 199

An anonymous reader quotes a report from Politico: President Joe Biden has determined that Colorado Springs will be the permanent headquarters of U.S. Space Command, reversing a Trump administration decision to move the facility to Alabama, the Pentagon announced Monday. The decision will only intensify a bitter parochial battle on Capitol Hill, as members of the Colorado and Alabama delegations have spent months accusing each other of playing politics on the future of the four-star command.

The command was reestablished in 2019 and given temporary headquarters in Colorado while the Air Force evaluated a list of possible permanent sites. With an eye on Russia and China, its job is to oversee the military's operations of space assets and the defense of satellites. Pentagon spokesperson Brig. Gen. Pat Ryder said Biden notified the Department of Defense on Monday that he had made the decision, after speaking with Defense Secretary Lloyd Austin and weighing the input of senior military leaders. "Locating Headquarters U.S. Space Command in Colorado Springs ultimately ensures peak readiness in the space domain for our nation during a critical period," Ryder said in a statement. "It will also enable the command to most effectively plan, execute and integrate military spacepower into multi-domain global operations in order to deter aggression and defend national interests." Austin, Air Force Secretary Frank Kendall and U.S. Space Command chief Gen. James Dickinson all support Biden's decision, Ryder added.

The most significant factor Biden weighed in making the decision was the impact such a move would have on the military's ability to confront the changing threat from space, according to a senior administration official, who like others was granted anonymity to discuss sensitive deliberations. Keeping the headquarters at Colorado Springs "maintains operational readiness and ensures no disruption to its mission or to its personnel," according to the official. The command is set to achieve "full operational capability" this month, the official said. A move to Alabama, by contrast, would have forced the command to transition to a new headquarters in the mid-2020s, and the new site would not have been open until the early to mid-2030s, the official said. "The president found that risk unacceptable, especially given the challenges we may face in the space domain during this critical time period," according to the official.

Businesses

SEC Now Requires Companies To Disclose Cyberattacks In 4 Days (bleepingcomputer.com) 17

The U.S. Securities and Exchange Commission (SEC) has implemented new rules requiring publicly traded companies to disclose any cyberattacks considered material incidents within four business days of discovery. BleepingComputer reports: According to the Wall Street watchdog, material incidents are those that a public company's shareholders would consider important "in making an investment decision." The SEC also adopted new regulations mandating foreign private issuers to provide equivalent disclosures following cybersecurity breaches. Listed companies must now include details about the cyberattack (including the incident's nature, scope, and timing) in periodic report filings, specifically on 8-K forms.

These new cybersecurity incident reporting rules are set to take effect in December or 30 days after being published in the Federal Register. However, smaller companies will be granted an additional 180 days before they are required to provide Form 8-K disclosures. In some instances, the disclosure timeline may also be postponed if the U.S. Attorney General determines that an immediate disclosure would pose a significant risk to national security or public safety.
"Whether a company loses a factory in a fire -- or millions of files in a cybersecurity incident -- it may be material to investors. Currently, many public companies provide cybersecurity disclosure to investors," said SEC Chair Gary Gensler today.

"I think companies and investors alike, however, would benefit if this disclosure were made in a more consistent, comparable, and decision-useful way. Through helping to ensure that companies disclose material cybersecurity information, today's rules will benefit investors, companies, and the markets connecting them."
United States

FTC Readies Lawsuit That Could Break Up Amazon 62

The Federal Trade Commission is finalizing its long-awaited antitrust lawsuit against Amazon, POLITICO reported Tuesday, citing people with knowledge of the matter, a move that could ultimately break up parts of the company. From the report: The FTC has been investigating the company on a number of fronts, and the coming case would be one of the most aggressive and high-profile moves in the Biden administration's rocky effort to tame the power of tech giants. The wide-ranging lawsuit is expected as soon as August, and will likely challenge a host of Amazon's business practices, said the people, who were granted anonymity to discuss a confidential matter. If successful, it could lead to a court-ordered restructuring of the $1.3 trillion empire and define the legacy of FTC Chair Lina Khan.

Khan rose to prominence as a Big Tech skeptic with a 2017 academic paper specifically identifying Amazon as a modern monopolist needing to be reined in. Because any case will likely take years to wind through the courts, the final result will rest with her successors. The exact details of the final lawsuit are not known, and changes to the final complaint are expected until the eleventh hour. But personnel throughout the agency, including Khan herself, have homed in on several of Amazon's business practices, said some of the people.
Google

Google Tests AI Tool That Is Able To Write News Articles (nytimes.com) 43

Google is testing a product that uses artificial intelligence technology to produce news stories, pitching it to news organizations including The New York Times, The Washington Post and The Wall Street Journal's owner, News Corp, The Times reported, citing people familiar with the matter. From the report: The tool, known internally by the working title Genesis, can take in information -- details of current events, for example -- and generate news copy, the people said, speaking on the condition of anonymity to discuss the product.

One of the three people familiar with the product said that Google believed it could serve as a kind of personal assistant for journalists, automating some tasks to free up time for others, and that the company saw it as responsible technology that could help steer the publishing industry away from the pitfalls of generative A.I. Some executives who saw Google's pitch described it as unsettling, asking not to be identified discussing a confidential matter. Two people said it seemed to take for granted the effort that went into producing accurate and artful news stories.

Businesses

VanMoof Explores Sale Under Court Protection Because It Can't Pay Bills (theverge.com) 18

swinferno shares a report: VanMoof -- the Amsterdam-based e-bike maker that once bragged about being the "most funded e-bike company in the world" -- has turned to the Dutch courts for legal protection in order to give the company time to pay its bills. The company is exploring all possible routes out of its debt, including a possible sale, according to a source familiar with the matter. All options are on the table as the company looks for a path to survival. The company is also temporarily closing its brand stores. Amid rumors of trouble, angry customers descended on VanMoof's flagship Amsterdam store and service center (and former global HQ) on Wednesday to claim their bikes that had been brought in for service weeks ago.

The closures are meant to safeguard VanMoof employees. The so-called preliminary "surseance van betaling" (which translates to "suspension of payment") that VanMoof has entered is typically granted for a period of up to 18 months and -- importantly -- is designed to help companies avoid bankruptcy. However, it's also often the first step toward bankruptcy proceedings. Under Dutch law, creditors cannot claim their debts during the suspension of payment period, which ends once all creditors are paid, a final agreement with creditors is reached (private or judicial), or when the company is declared bankrupt.

Medicine

FDA Grants First Full Approval For an Alzheimer's Drug In 20 Years 29

An anonymous reader quotes a report from Politico: The FDA on Thursday granted traditional approval to an Alzheimer's drug for the first time in more than two decades. Now, the question becomes how many people will be able to access the drug, which is targeted at patients in the early stages of the debilitating disease. Medicare has said that it will reimburse the drug's costs -- more than $26,000 annually -- only for beneficiaries enrolled in a nationwide registry that tracks patient side effects and outcomes over time. Patient advocacy groups and some clinicians fear this means that few of the hundreds of thousands of Alzheimer's patients eligible for the treatment will be able to access it.

The agency previously granted Leqembi, developed and manufactured by Eisai and Biogen, accelerated approval before evaluating late-stage clinical trial data earlier this year. The drug moderately slowed trial participants' cognitive decline compared to a placebo, according to the data, but had potentially serious side effects, including brain swelling and bleeding. Under accelerated approval, the Centers for Medicare and Medicaid Services said it would cover Leqembi only for those participating in a randomized clinical trial, of which none were enrolling. Medicare's coverage determination was contrary to the Veterans Health Administration, which said it would cover the drug for its beneficiaries without restriction.

Roughly 6.7 million people in the U.S. have Alzheimer's, and there are few treatments for the disease. Aduhelm, a drug from Biogen that received accelerated approval in 2021, works similarly to Leqembi by targeting proteins thought to be one of the causes of the disease. But both drugs have received little uptake due to Medicare coverage restrictions, and patient and caregiver concerns over the evidence of its modest benefits. There are five existing treatments for Alzheimer's that treat some of the disease's symptoms, but do not slow progression of the disease.
Democrats

Judge Rules White House Pressured Social Networks To 'Suppress Free Speech' (arstechnica.com) 246

A federal judge yesterday ordered the Biden administration to halt a wide range of communications with social media companies, siding with Missouri and Louisiana in a lawsuit (PDF) that alleges Biden and his administration violated the First Amendment by colluding with social networks "to suppress disfavored speakers, viewpoints, and content." Ars Technica reports: The Biden administration argued that it communicated with tech companies to counter misinformation related to elections, COVID-19, and vaccines, and that it didn't exert illegal pressure on the companies. The communications to social media companies were not significant enough "to convert private conduct into government conduct," Department of Justice lawyers argued in the case. But Judge Terry Doughty, a Trump nominee at US District Court for the Western District of Louisiana, granted the plaintiffs' request (PDF) for a preliminary injunction imposing limits on the Department of Health and Human Services, the National Institute of Allergy and Infectious Diseases, the Centers for Disease Control and Prevention, the Federal Bureau of Investigation, the Department of Justice, the US Census Bureau, the State Department, the Homeland Security Department, the Cybersecurity and Infrastructure Security Agency, and many specific officials at those agencies. The injunction also affects White House officials.

The agencies and officials are prohibited from communicating "with social-media companies for the purpose of urging, encouraging, pressuring, or inducing in any manner the removal, deletion, suppression, or reduction of content containing protected free speech posted on social-media platforms," Doughty ruled. The injunction prohibits "specifically flagging content or posts on social-media platforms and/or forwarding such to social-media companies urging, encouraging, pressuring, or inducing in any manner for removal, deletion, suppression, or reduction of content containing protected free speech." Government agencies and officials are further barred from urging, encouraging, or pressuring social media companies "to change their guidelines for removing, deleting, suppressing, or reducing content containing protected free speech." The ruling also said the government may not coordinate with third-party groups, including the Election Integrity Partnership, the Virality Project, and the Stanford Internet Observatory, to pressure social media companies.

Doughty provided several exceptions that allow the government to communicate with social media companies about criminal activity and other speech that the First Amendment doesn't protect. The Biden administration may continue to inform social networks about posts involving criminal activity or criminal conspiracies, national security threats, extortion, criminal efforts to suppress voting, illegal campaign contributions, cyberattacks against election infrastructure, foreign attempts to influence elections, threats to public safety and security, and posts intending to mislead voters about voting requirements and procedures. The US can also exercise "permissible public government speech promoting government policies or views on matters of public concern," communicate with social networks "in an effort to detect, prevent, or mitigate malicious cyber activity," and "communicat[e] with social-media companies about deleting, removing, suppressing, or reducing posts on social-media platforms that are not protected free speech by the Free Speech Clause in the First Amendment to the United States Constitution."

Businesses

Activision Will Be Jilted if Microsoft Deal Blocked, CEO Kotick Says (bloomberg.com) 26

Activision Blizzard will likely abandon a $69 billion takeover bid by Microsoft if the US Federal Trade Commission wins a ruling pausing the deal, the game maker's chief executive officer told a judge. From a report: Microsoft called Activision CEO Bobby Kotick to testify in San Francisco federal court Wednesday to reinforce its claim that the acquisition won't hurt competition in the markets for console and subscription-based games. US District Judge Jacqueline Scott Corley must decide whether to halt the deal -- which has a July 18 closure deadline -- while the FTC's legal challenge to the transaction plays out. "My board's view is if the preliminary injunction is granted, we don't see how this will continue," Kotick said.
Microsoft

FTC Argues Microsoft's Deal To Buy Activision Should Be Paused (reuters.com) 21

The U.S. Federal Trade Commission on Thursday argued in federal court for a preliminary injunction to temporarily block Microsoft's acquisition of videogame maker Activision Blizzard, which would stop the deal from closing before the government's case against it is heard by an administrative judge. From a report: "If this deal is completed, the combined company ... is likely to have the ability, an incentive, to harm competition in various markets related to consoles, subscription services and the cloud (for gaming)," FTC lawyer James Weingarten said in the government's opening arguments in what is expected to be a five-day evidentiary hearing.

The FTC argues it needs a judge to block Microsoft and Activision Blizzard from closing their $69 billion merger until the agency's in-house court gets to rule on whether the combination hurts competition in the videogame industry. The FTC says the combination would give Microsoft's Xbox videogame console exclusive access to Activision games, leaving Nintendo consoles and Sony Group's PlayStation out in the cold. "I think you will see that every piece of evidence shows that it only makes sense for Xbox to make these Activision games to as many people on as many platforms as possible," Microsoft lawyer Beth Wilkinson said in opening arguments, adding that if an injunction is granted it could result in a three-year administrative proceeding that would kill the deal.

Businesses

Apple Is Taking On Apples in a Truly Weird Trademark Battle (wired.com) 67

Apple, the company, wants rights to the image of apples, the fruit, in Switzerland -- one of dozens of countries where it's flexing its legal muscles. From a report The Fruit Union Suisse is 111 years old. For most of its history, it has had as its symbol a red apple with a white cross -- the Swiss national flag superimposed on one of its most common fruits. But the group, the oldest and largest fruit farmer's organization in Switzerland, worries it might have to change its logo, because Apple, the tech giant, is trying to gain intellectual property rights over depictions of apples, the fruit. "We have a hard time understanding this, because it's not like they're trying to protect their bitten apple," Fruit Union Suisse director Jimmy Mariethoz says, referring to the company's iconic logo. "Their objective here is really to own the rights to an actual apple, which, for us, is something that is really almost universal ... that should be free for everyone to use."

While the case has left Swiss fruit growers puzzled, it's part of a global trend. According to the World Intellectual Property Organization's records, Apple has made similar requests to dozens of IP authorities around the world, with varying degrees of success. Authorities in Japan, Turkey, Israel, and Armenia have acquiesced. Apple's quest to own the IP rights of something as generic as a fruit speaks to the dynamics of a flourishing global IP rights industry, which encourages companies to compete obsessively over trademarks they don't really need. Apple's attempts to secure the trademark in Switzerland go as far back as 2017, when the Cupertino, California-based giant submitted an application to the Swiss Institute of Intellectual Property (IPI) requesting the IP rights for a realistic, black-and-white depiction of an apple variety known as the Granny Smith -- the generic green apple.

The request covered an extensive list of potential uses -- mostly on electronic, digital, and audiovisual consumer goods and hardware. Following a protracted back-and-forth between both parties, the IPI partially granted Apple's request last fall, saying that Apple could have rights relating to only some of the goods it wanted, citing a legal principle that considers generic images of common goods -- like apples -- to be in the public domain. In the spring, Apple launched an appeal. The case now moving through the courts deals only with the goods for which the IPI refused the trademark, which an IPI official said could not be disclosed without consent from Apple, because the proceedings are still pending, but which include common uses such as audiovisual footage "meant for television and other transmission."

The Courts

Trial Lawyer Went After Crypto Companies. Then Someone Went After Him. (sfgate.com) 49

Trial lawyer Kyle Roche has led an interesting life, according to the New York Times. He once earned $100 million selling bitcoin. He helped win a case against Craig Wright (who claims to be Bitcoin creator Satoshi Nakamoto) through his law firm Roche Freedman. And Roche also founded a startup that lets people bet on the outcome of (civil) lawsuits, "to make access to justice more affordable."

But something very bad for his career happened in January of 2022 when two businessmen flew Roche from Miami to the U.K. to discuss an investment. When he woke up the next morning, Roche said, he felt groggy... The brain fog was odd because he didn't think he'd had all that much to drink. As he flew back to Miami a few days later, Roche couldn't shake the feeling that something was amiss.

Months passed. Then, one day last summer, Roche's world detonated. A website called Crypto Leaks posted two dozen videos of him that had been secretly recorded during his meetings with Villavicencio and Ager-Hanssen. The videos portrayed Roche and his law firm, Roche Freedman, as being in the pocket of one of their crypto clients [Ava Labs]... In other clips, Roche made it sound like his sole concern, even when representing other clients, was to promote Ava Labs' interests...

One after another, companies that Roche Freedman had sued filed motions to disqualify the firm from their cases. In October, the first of those motions succeeded: A federal judge in New York tossed Roche Freedman from a case it had filed against Tether, the operator of the world's most used "stablecoin." Within days, Roche was forced to resign from the law firm he had founded. With his career in tatters, he said, he enrolled in ethics classes and began to see a therapist.

Roche calls the recorded remarks baseless bluster to impress a prospective investor (and alleges in court there are signs of deep fake alterations). While Roche "was felled by his own loose lips and his overly cozy relationship with a client," the Times reports "he also was the victim of an elaborate international setup." On April 3, 2020, Roche Freedman filed lawsuits seeking class-action status against seven issuers of digital coins, alleging they had pumped what amounted to unregistered securities with false statements and then dumped them, leaving retail investors holding the bag... Those suits were just an opening salvo: Sixteen months later, Roche filed his biggest securities fraud case yet. It alleged that a British entrepreneur, Dominic Williams, and entities he controlled had swindled investors out of billions of dollars by aggressively promoting, and then dumping, a digital coin tied to a grandiose plan to revolutionize computing. Williams had boldly proclaimed that his Internet Computer blockchain — a decentralized network of computers powered by a digital token called ICP — would supplant the big cloud services offered by Amazon and Microsoft and become humanity's primary computing platform. But after an initial surge that briefly made it one of the most valuable cryptocurrencies, ICP had plummeted 92% — a collapse that Roche's lawsuit attributed to "massive" selling by Williams and other insiders. (Williams denied the allegations.)
The Times reports that Roche's prospective investor Ager-Hanssen, "in addition to running his venture capital firm, has long had a sideline digging up dirt on behalf of wealthy clients entangled in business disputes in Britain and Scandinavia. On multiple occasions, he has secretly recorded his targets. For example, in a 2014 interview, he recounted how he had snared the adversary of a Swedish financier with a hidden microphone and boasted that he employed former intelligence officers from the CIA, MI6 and Mossad..." Roche believes them because he thinks he knows who hired Ager-Hanssen: Williams, the British entrepreneur who was the target of Roche Freedman's biggest pump-and-dump lawsuit... On May 12, 2022, Williams wrote on Twitter that he was "coming for" his critics. That was the same day the cryptoleaks.info domain name was registered. That was the same day the cryptoleaks.info domain name was registered. Then, on June 9, 2022, the Crypto Leaks website went live. Billing itself as the defender of "the honest crypto community," it posted two reports that aligned with Williams' interests...

The first espoused a complicated theory about the ICP token crash that Williams had previously floated on Twitter. The second attacked the Times for an article it had published about the crash. Williams tweeted a link to that Crypto Leaks report, calling it "Gobsmacking." The Dfinity Foundation, a Swiss nonprofit that Williams created to oversee his blockchain, has since sued the Times for defamation in New York. The Times is seeking to dismiss the suit. The videos of Roche were the crux of Crypto Leaks' third exposé. After they were published, Williams and Dfinity filed a motion to disqualify Roche Freedman as plaintiffs' counsel in the pump-and-dump lawsuit, saying Roche's comments demonstrated "a disregard for the integrity of the judicial system...."

Last month, the judge overseeing the pump-and-dump case granted Williams' motion and disqualified Freedman Normand Friedland as plaintiffs' counsel.

China

Apple Faces Trademark Battle With Huawei To Use 'Vision Pro' Name In China (macrumors.com) 23

An anonymous reader quotes a report from MacRumors: Apple may be forced to change the name of its new mixed reality headset in China unless it can come to an agreement with Huawei, which already owns the "Vision Pro" trademark in the country. Originally spotted by MyDrivers, the trademark was originally granted to Huawei on May 16, 2019, and gives the company exclusive rights to its use in China from November 28, 2021 to November 27, 2031. Huawei actively uses the trademark in China, and offers a number of products under the Vision name, including smart TVs and smart glasses. If Apple intends to sell its headset in China and call it Vision Pro, it may have to enter into negotiations with Huawei to release the trademark for a price. Apple has had a similar trademark issue with a Chinese company in the past. "Apple in 2012 paid Proview Technology $60 million for the rights to the 'iPad' trademark in China," reports MacRumors. "The payment followed several court cases in which Apple unsuccessfully argued that it had already acquired the rights for the name as part of a deal with Proview's Taiwanese arm."
Businesses

US Judge Temporarily Blocks Microsoft Acquisition of Activision (reuters.com) 40

A U.S. judge has granted the FTC request to temporarily block Microsoft's acquisition of Activision Blizzard, scheduling a hearing for a preliminary injunction and preventing the deal from closing until a court ruling is made. Reuters reports: U.S. District Judge Edward Davila scheduled a two-day evidentiary hearing on the FTC's request for a preliminary injunction for June 22-23 in San Francisco. Without a court order, Microsoft could have closed on the $69 billion deal as early as Friday. Davila said the temporary restraining order "is necessary to maintain the status quo while the complaint is pending (and) preserve this court's ability to order effective relief in the event it determines a preliminary injunction is warranted and preserve the FTC's ability to obtain an effective permanent remedy in the event that it prevails in its pending administrative proceeding."

Microsoft and Activision must submit legal arguments opposing a preliminary injunction by June 16; the FTC must reply on June 20. Davila said the bar on closing will remain in place until at least five days after the court rules on the preliminary injunction request. The case reflects the muscular approach to antitrust enforcement taken by the administration of U.S. President Joe Biden.

Patents

US Patent Office Proposes Rule To Make It Much Harder To Kill Bad Patents (techdirt.com) 110

An anonymous reader quotes a report from Techdirt: So, this is bad. Over the last few years, we've written plenty about the so-called "inter partes review" or "IPR" that came into being about a decade ago as part of the "America Invents Act," which was the first major change to the patent system in decades. For much of the first decade of the 2000s, patent trolls were running wild and creating a massive tax on innovation. There were so many stories of people (mostly lawyers) getting vague and broad patents that they never had any intention of commercializing, then waiting for someone to come along and build something actually useful and innovative... and then shaking them down with the threat of patent litigation. The IPR process, while not perfect, was at least an important tool in pushing back on some of the worst of the worst patents. In its most basic form, the IPR process allows nearly anyone to challenge a bad patent and have the special Patent Trial and Appeal Board (PTAB) review the patent to determine if it should have been granted in the first place. Given that a bad patent can completely stifle innovation for decades this seems like the very least that the Patent Office should offer to try to get rid of innovation-killing bad patents.

However, patent trolls absolutely loathe the IPR process for fairly obvious reasons. It kills their terrible patents. The entire IPR process has been challenged over and over again and (thankfully) the Supreme Court said that it's perfectly fine for the Patent Office to review granted patents to see if they made a mistake. But, of course, that never stops the patent trolls. They've complained to Congress. And, now, it seems that the Patent Office itself is trying to help them out. Recently, the USPTO announced a possible change to the IPR process that would basically lead to limiting who can actually challenge bad patents, and which patents could be challenged.

The wording of the proposed changes seems to be written in a manner to be as confusing as possible. But there are a few different elements to the proposal. One part would limit who can bring challenges to patents under the IPR system, utilizing the power of the director to do a "discretionary denial." For example, it would say that "certain for-profit entities" are not allowed to bring challenges. Why? That's not clear. [...] But the more worrisome change is this one: "Recognizing the important role the USPTO plays in encouraging and protecting innovation by individual inventors, startups, and under-resourced innovators who are working to bring their ideas to market, the Office is considering limiting the impact of AIA post-grant proceedings on such entities by denying institution when certain conditions are met." Basically, if a patent holder is designated as an "individual inventor, startup" or "under-resourced innovator" then their patents are protected from the IPR process. But, as anyone studying this space well knows, patent trolls often present themselves as all three of those things (even though it's quite frequently not at all true). [...] And, again, none of this should matter. A bad patent is a bad patent. Why should the USPTO create different rules that protect bad patents? If the patent is legit, it will survive the IPR process.
The Electronic Frontier Foundation issued a response to the proposed changes: "The U.S. Patent Office has proposed new rules about who can challenge wrongly granted patents. If the rules become official, they will offer new protections to patent trolls. Challenging patents will become far more onerous, and impossible for some. The new rules could stop organizations like EFF, which used this process to fight the Personal Audio 'podcasting patent,' from filing patent challenges altogether."

The digital rights group added: "If these rules were in force, it's not clear that EFF would have been able to protect the podcasting community by fighting, and ultimately winning, a patent challenge against Personal Audio LLC. Personal Audio claimed to be an inventor-owned company that was ready to charge patent royalties against podcasters large and small. EFF crowd-funded a patent challenge and took out the Personal Audio patent after a 5-year legal battle (that included a full IPR process and multiple appeals)."
China

US To Allow South Korean, Taiwan Chip Makers To Keep Operations In China (msn.com) 27

According to the Wall Street Journal, the Biden administration is expected to allow leading semiconductor manufacturers from South Korea and Taiwan to continue and expand their chipmaking operations in China. From a report: Alan Estevez, undersecretary of commerce for industry and security, announced the decision at an industry gathering last week. The exemptions, initially granted for one year in October last year, were provided to several companies, including South Korea's Samsung Electronics and Taiwan Semiconductor Manufacturing, who have invested billions in building plants in China.

The decision to extend the exemptions reflects the challenges faced by U.S. authorities in isolating China from high-tech goods in a highly integrated global industry. The U.S. has been trying to keep advanced chips out of Chinese hands by limiting exports not only from American manufacturers but also those made by allies. However, U.S. and foreign chip makers have resisted these efforts, and governments in Asia and Europe have also pushed back. The most vocal criticism has come from South Korea, whose largest export market is China.
Further reading: Ex-Samsung Executive Accused of Stealing Secrets for China Chip Factory

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