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Jay P. Kesan and Carol M. Hayes

Section 101 of the Patent Act establishes the baseline for patent eligibility. There are three common law exceptions to statutory subject matter eligibility: abstract ideas, laws of nature and natural phenomena. These exceptions were delineated with the primary goal of preventing a patent from preempting beneficial downstream research and innovation. In 2014, the Supreme Court took steps to clarify the abstract idea exception in Alice Corp. v. CLS Bank. The patents at issue in Alice concerned the use of computers as intermediaries for mitigating settlement risk. After commenting on the ubiquity of computers in modern life, the Supreme Court concluded that the use of a generic computer to execute an abstract idea was too routine and conventional to transform the abstract idea into patent eligible subject matter. In this chapter, we discuss post-Alice cases and the ways that they have applied the ambiguously worded two-part test from Alice. Our initial analysis underscores the continuing importance of the machine-or-transformation test. We also examine the “routine and conventional” analysis and the different types of processes that courts have tended to consider and find to be abstract ideas. For example, a mental task or something that can be figured out using a pen and paper is often considered an abstract idea. There are also several procedural issues that have repeatedly emerged, including the stage of litigation where a Section 101 analysis is appropriate, the importance of claim construction, and the presumption of validity for issued patents under Section 282 of the Patent Act. This chapter also examines recently amended USPTO rules and procedures and how they interact with post-Alice eligibility analysis.

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Marketa Trimble

National laws sometimes reach outside the country that adopted them, and laws in these cases produce extraterritorial effects. But regardless of whether national laws do or do not have extraterritorial effects, they sometimes require enforcement abroad. The need for extraterritorial enforcement arises when a defendant and its assets are located outside the country of the court or agency that wants to enforce the laws. This situation may occur frequently on the Internet because the Internet makes it easy for people to strategically locate their assets and conduct their affairs in different countries in an attempt to avoid the enforcement power of certain jurisdictions. This chapter discusses the extraterritorial enforcement of national laws on the Internet and considers whether extraterritorial enforcement can be improved. Improvements might be desirable for several reasons. For example, improvements in enforceability would bring clarity to legislative debates on substantive issues and contribute to better substantive policy choices not clouded with concerns about the feasibility of enforcement. Countries have already developed alternative enforcement mechanisms, such as enforcement through the assistance of Internet service providers and payment processors, but these mechanisms generate their own problems and cannot fully replace direct enforcement. The chapter begins by discussing limits on the ubiquity of activities on the Internet and the lack of uniformity in conducting commercial activity on the Internet. Geoblocking and other market partitioning tools are among the means that actors on the Internet employ to limit the territorial reach of their activities on the Internet. The chapter discusses differences between the point-of-source and point-of-consumption principles and rationales that lead legislators to choose between the two principles when drafting legislation. The chapter further explains the limitations on a country’s enforcement capacity and the extent to which a country may rely on other countries for enforcement assistance. The ability of countries to enforce by themselves, and to assist other countries with enforcement, is subject to certain supranational limitations on extraterritorial enforcement, which the chapter also explores. The chapter concludes by making suggestions for improvements in extraterritorial enforcement of national laws: for example, it seems reasonable to use the same vehicle – the Internet – that generates the disputes to facilitate the resolution of those disputes, particularly when the disputes necessitate extraterritorial enforcement.

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Juliet M. Moringiello

The proliferation of electronic communications technologies has affected business transactions in myriad ways. Transacting parties enter into agreements electronically, transfer payments electronically, and create, acquire, and sell electronic assets that did not exist decades ago. Modern communications technologies also enable parties to gain control over tangible assets remotely. Many of these transactions are governed by the Uniform Commercial Code (“UCC”), a statute enacted in an era when assets were tangible and contracts were written on paper and signed in ink. Recognizing the migration of electronic transactions to the electronic environment, the two sponsors of the UCC – the American Law Institute and the Uniform Law Commission – have modernized several UCC articles, including Article 9, which governs secured transactions. The two sets of amendments promulgated in 1999 and 2010 recognize both the electronic creation of a security interest and the development of electronic assets. Despite the modernization of Article 9, traps for the unwary remain. Electronic transactions raise potential issues under Article 9 of the UCC at each critical point in a secured transaction. In order for a secured party to foreclose on an asset and realize its value, the secured party must correctly describe the asset in its security agreement with the debtor. In order to have priority in the asset, and to be protected as a secured creditor in the debtor’s bankruptcy, the secured party must have perfected its security interest, usually by filing a financing statement that provides public notice of the security interest. The comprehensive revisions to Article 9 that were promulgated in 1999 incorporate and facilitate the use of electronic communications in secured transactions by enabling the use of such communications in both creating and perfecting security interests. Open questions remain, however, when the collateral itself is electronic and when creditors use electronic means to enforce their security interests. This chapter explains some of these potential issues.

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Amy J. Schmitz

Ecommerce is overshadowing face-to-face transactions in business-to-consumer (“B2C”) commerce. This benefits consumers in providing more buying options, but may leave them with no remedies when purchases go awry. This chapter therefore discusses how online dispute resolution (“ODR”) systems may expand and equalize remedy systems in B2C exchanges. Part II of the chapter discusses the need for expanded ODR to provide consumers with access to remedies regarding online purchases. Part III explains how ODR systems are unfolding on international and domestic fronts in B2C exchanges. Part IV then highlights their strengths and weaknesses and proposes ideas for how ODR systems can be improved to offer consumers efficient and fair means for accessing ecommerce remedies. The chapter concludes with an invitation to continue the development of such ODR systems in an effort to foster revived corporate responsibility and empower all consumers regardless of their resources, power, or status.

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Ariana R. Levinson

This chapter addresses the increasingly important issue of how the National Labor Relations Act applies to postings by employees on social media. It argues that in large part the National Labor Relations Board (“Board”) has correctly applied the decades-old concept of protected concerted activity to new technological meeting places. The legal concepts at issue are founded in longstanding precedent. The chapter discusses the laws protecting employee posts on social media that are concerted activity for mutual aid or protection. The chapter demonstrates that employers are prohibited from disciplining employees for use of social media in precisely the same way they are prohibited from disciplining employees for other protected concerted activity. The chapter also discusses the Board’s regulation of employers’ social media policies. The Board regulates the policies to insure they are not so broad as to interfere with employees’ exercise of their right to engage in protected concerted activity. The chapter demonstrates that, for many years, employers and employees have successfully complied with regulation of similar employer policies, and the result should be no different as to social media policies. Other authors have argued that the Board precedent is inconsistent, confusing, or wrong, and proposed legal refinements, rulemaking, or legislative action. This chapter updates the developing law and instead contends that the current Board precedent is largely correct, and that only a few small changes would place it on extremely solid footing.

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Sonia E. Rolland

Consumer protection largely remains the province of domestic regulators acting within the confines of their jurisdiction, but globalized trade, and electronic commerce in particular, challenges such a model. Nevertheless, very little has been done to bridge the gap between domestic regulation and remedies on the one hand, and a globalized production chain that is directly accessible to consumers via ecommerce on the other. From early calls for international harmonization to current treaty negotiations, the debate is now in the public eye, but little consensus has emerged on the most effective way to protect consumers in cross-border ecommerce transactions. The eclectic nature of consumer protection issues that arise in relation to cross-border ecommerce, combined with the lack of a single forum or framework to parse out these issues, raises considerable challenges on a global scale. Although most consumer protection advocates do not typically think of trade regimes as the appropriate forum for consumer protection, the fact remains that trade law has both positive and negative impacts on consumer protection, many of which remain unaddressed and under-researched. That is not to say that trade agreements are the appropriate or the best forum for protecting consumer interests, but it highlights the need to consider how trade disciplines affect consumer protection and how the trade regime relates to other regulatory authorities in this space. This chapter outlines consumer interests and domestic regulatory responses. It then examines how consumer interests in ecommerce are treated in trade law, including at the World Trade Organization and in other trade agreements.  The chapter then surveys initiatives outside of trade law to protect consumers in the digital economy, including international cooperation outside the context of trade law.

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Christiana N. Markou and Christine Riefa

This chapter focuses on the protection of the consumer under EU law when purchasing and using applications (apps) for mobile phones. It examines the provisions of two principal EU consumer protection measures, namely the Consumer Rights Directive and the Unfair Commercial Practice Directive, as they apply to the particular digital product which creates special consumer needs. Under these two EU Directives, the consumer is entitled to receive prior information on the product and some of this information is often tailored to the nature of applications as digital content. Moreover, under certain circumstances, the consumer can withdraw from an “app-contract” without having to pay for any content he or she has received. More generally, the consumer should not be misled into purchasing a mobile application or making in-app purchases, and certain of the techniques utilized to push consumers towards such purchases are liable to be considered aggressive and thus legally impermissible even when not misleading. The chapter shows that legislation is in place to protect the consumer, yet as the rules are not app-specific, many issues surrounding their interpretation or practical application may cause problems. The European Commission and national regulatory bodies have issued useful guidelines regarding the application of the rules to mobile applications, but certain issues seem to merit further clarification.

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John A. Rothchild

The idea of network neutrality has dominated telecommunication policy discussions over the past few years to an extent unprecedented in the history of that subject matter. In March 2015, the Federal Communications Commission (“FCC”) issued a detailed scheme of regulation that makes network neutrality the law of the land. The path by which the FCC arrived at the Order was anything but direct, and the fate of the Order is yet to be decided by the courts. This chapter offers a guide through the thorny paths of network neutrality. The chapter begins with a review of the historical precursors to network neutrality regulation, starting with a 1956 court decision that disapproved an effort by AT & T to ban the attachment of devices to the phone system, and continuing through FCC rulemakings in the 1960s and 1970s that regulated the participation of telephone companies in the provision of services that involve data processing. These competition-enhancing rules led to a 2005 FCC policy statement that set forth principles that the FCC would apply to ensure that Internet service providers would not be able to distort competition by discriminating against particular content, applications, or non-harmful devices. These principles were then implemented in a 2010 rule known as the Open Internet Order. In a 2014 decision, the D.C. Circuit invalidated the Order as inconsistent with the FCC’s statutory authority. The FCC thereupon initiated a new rulemaking, which resulted in its issuance of a new Open Internet Order in 2015. As of the writing of this chapter a challenge to the 2015 Order is pending before the D.C. Circuit. The chapter continues by analyzing the content of the 2015 Order, placing it in the context of its historical antecedents. It concludes by addressing several objections that have been raised against network neutrality regulation.

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Edward A. Morse

Gambling in the United States is primarily regulated by the states, with federal laws supporting that regulatory scheme. Criminal proscriptions often apply to unapproved gambling operations, but they are subject to jurisdictional constraints. Cross-border communications technologies challenge the efficacy of those constraints, and the Internet presents a formidable new adversary for regulators. Federal laws including the Wire Act, the Professional and Amateur Sports Protection Act, and the Unlawful Internet Gambling Enforcement Act leverage federal power to constrain Internet gambling operations while preserving a zone of authority for the states. However, the resulting patchwork of laws and regulations presents legal uncertainties for patrons and considerable room for legal maneuvering by gaming operators, as evidenced by recent enforcement efforts. Federal policy changes announced in 2011 regarding enforcement of the Wire Act have arguably expanded the zone of state authority, thereby creating new opportunities for Internet gambling firms. Three states – Nevada, Delaware, and New Jersey – have chosen to regulate certain forms of Internet gambling for their residents. Other states have responded by proscribing Internet gambling, favoring their own state-licensed venues or continuing restrictions on most forms of gambling. The emergence of fantasy sports leagues has added new complexities to this evolving legal framework, raising new questions about the boundaries of gambling regulation and drawing new attention from state regulators concerned about consumer protection and emergent problem behaviors. These challenges for government regulators extend across international borders. The chapter concludes with a brief look at global regulatory issues, including WTO and EU frameworks involving free trade among member states. Consumer demand for gambling and government interest in associated tax revenues ensures that efforts to regulate will persist. However, such efforts must address similar challenges across the globe, including concerns about consumer protection, money laundering, and the means to address emergent problem-gambling behaviors.

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James P Nehf

The 2014 White House paper on privacy and big data signaled that the Obama administration might acknowledge that efforts to limit data collection online through a “notice and choice” regime have failed and instead work toward developing data privacy norms that focus more on permissible purposes of data collection in an attempt to limit its use post-collection. When it came to proposing legislation, however, the administration retreated from its earlier rhetoric, and in 2015 proposed a privacy Bill of Rights that wholly embraced notice and choice, albeit in an enhanced or heightened state for certain kinds of data collection that were perceived to be particularly sensitive. The first section of this chapter discusses the proposed privacy legislation and its inclusion of a heightened notice and choice framework. The second part explains why even heightened notice and choice fails to protect legitimate privacy interests, particularly in an online environment. The third section explores what a regime based on permissible uses of data might look like and includes suggestions on how we might get there.