Category Archives: guest posts

Lara Croft: Tomb Raider…and Wanted Felon

(This guest post was written by unapologetically geeky gamer lawyer Angelo Alcid, who writes about real-life video game law issues at his blog The Geek Law Journal.)

Since the release of Tomb Raider in 1996, millions of people have been happily raiding tombs as intrepid archaeologist Lara Croft; however, back in April of last year, Mark asked: how legal is anything Lara Croft does? (Note: Since I am a U.S. attorney, this analysis will be based on prevailing U.S. law. Ms. Croft’s fate in the courts of her home country of England is best left to experts across the pond.)

The UNESCO 1970 Convention

The single most significant law affecting Ms. Croft’s globe-spanning archaeological pursuits is the UNESCO 1970 Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property. The UNESCO 1970 Convention was drafted to combat the illicit trafficking of cultural artifacts by giving member nations the right to recover stolen or illegally exported antiquities from other member countries.

At the time of this writing, 124 nations are signatories to the treaty, including almost every nation that Lara Croft has visited during her various adventures (except for Tibet and Thailand). The United States ratified the UNESCO 1970 Convention and implemented it with the Convention on Cultural Property Implementation Act (CIPA), codified in 19 U.S.C. §§ 2601-13.

That being said, the UNESCO 1970 Convention and CIPA only come into play if the items in question were in fact 1) cultural artifacts, and 2) stolen or illegally exported. While UNESCO provides model provisions regarding state ownership of cultural objects, such model provisions are not themselves legally binding, and it is up to each member nation to implement laws concerning the ownership and exportation of cultural artifacts.

The Raiding of Foreign Tombs

Whether Lara Croft could face liability for the actual act of “raiding” would depend upon the local laws governing the tombs in question. The games are notably silent as to Lara having the proper permits to conduct her excavations, but it seems safe to assume that her tomb raiding is being done without the permission of the local governments and would almost certainly subject her to civil and/or criminal liability. (To be fair to the game developers, a cutscene or level wherein Lara visits a Peruvian government building to file for permits might not have made for the most exciting game.)

The question of whether or not Lara’s tomb raiding are illegal in the countries in which the tomb raiding is rather straightforward – the answer is almost certainly yes, as in each case she goes in without government sanction, guns blazing, often resulting in the complete destruction of the tomb in question.

For example, in Egypt, Article 6 of Law 117 states that “[a]ll antiquities are considered to be public property . . . It is impermissible to own, possess or dispose of antiquities except pursuant to the conditions set forth in this law and its implementing regulations.” Furthermore, Article 41 states that anyone who “unlawfully smuggles an antiquity outside the Republic or participates in such an act shall be liable to a prison term with hard labor and a fine of not less than 5,000 and not more than 50,000 pounds.” There are prison terms and fines outlined for removing an antiquity from its place, for transporting it outside of Egypt without express government permission, and for defacing artifacts and monuments, all of which Lara does during her brief time in Egypt looking for the final piece of the Scion in the first Tomb Raider game.

Rather than list off the innumerable fines and jail terms Lara would no doubt face in the various nations from which she retrieves artifacts, instead I will examine the legal consequences Lara may face after her adventures are concluded and she brings these artifacts home to hang up on her wall. (Lara Croft’s official home is in England; however, as previously stated, I will be analyzing her situation in the context of U.S. law. I would welcome a British lawyer’s perspective on how Lara would fare over there.)

National Stolen Property Act

In the U.S., a person may be subject to both civil and criminal liability for the sale and transport of illegally exported cultural artifacts. While Lara doesn’t ever actually sell any of the artifacts she finds, the fact remains that she is transporting all of these artifacts across state/national borders all the time, with many of them winding up in her personal collection at home. (For example, she has the Ark of the Covenant just sitting in the main hall of her mansion.)

The National Stolen Property Act (NSPA) prohibits the transportation “in interstate or foreign commerce [of] any goods, . . . of the value of $5,000 or more,” with knowledge that such goods were “stolen, converted or taken by fraud.” 18 U.S.C. § 2314. Enacted in 1948, the NSPA was originally intended to aid states in their pursuit of thieves, as the states’ ability to prosecute thieves was often limited when the thieves (or the property) would cross state lines.

United States v. McClain

However, in addition to interstate commerce, the NSPA also specifically mentions foreign commerce, and as a result it has been applied to the illegal import of artifacts stolen from foreign nations. In United States v. McClain, the defendant was prosecuted under the NSPA for illegally importing several pre-Columbian artifacts from Mexico.

On appeal, the defense argued that the NSPA could only be applied if the artifacts were  “stolen” as defined by the NSPA, and that the term “stolen” only covers “acts which result in the wrongful deprivation of rights of ‘ownership’ as that term is understood at common law. United States v. McClain, 545 F.2d 988, 994 (5th Cir. 1977). In other words, he couldn’t have stolen them if they weren’t officially owned by anyone.

The court reasoned that an explicit declaration of ownership by the government would be sufficient to consider the illegally exported artifacts “stolen” under the NSPA. (Without such an explicit declaration of ownership, prosecuting people in the U.S. for illegally exporting artifacts from foreign nations would simply amount to the United States enforcing the laws of other nations for them.)

While the respondents argued that Mexico had passed laws protecting their archaeological interests dating back to 1897, the court did not find a law specifically declaring ownership over the type of artifacts in question until 1972, when Mexico passed the Federal Law on Archaeological, Artistic and Historic Monuments and Zones. 312 Diario Oficial 16, 6 de mayo de 1972. Article 27 states that “[a]rchaeological monuments, movables and immovables, are the inalienable and imprescriptible property of the Nation.”

Because court could only establish that Mexico had officially declared its ownership interest over the artifacts in 1972, and it could not be established precisely when the defendant had exported the artifacts, the defendant was eventually acquitted of all but the conspiracy charges.

The McCain decision was cited 25 years later, in Unites States v. Schultz, 333 F.3d 393 (2003), in which the defendant was also prosecuted under the NSPA for the receipt of stolen Egyptian antiquities. In Schultz, the court looked to a law passed in Egypt (“Law 117”) that declared all antiquities found in Egypt after 1983 to be the property of the Egyptian government, and upheld the defendant’s conviction. Schultz was sentenced to 33 months in prison and a fine of $50,000, and nearly all of the artifacts he received were returned to Egypt.

Conclusion

On top of all the possible fines and jail time Lara Croft would likely face in each nation she visits in her tomb-raiding adventures, for each artifact she brings home she may also be prosecuted by the U.S. government for the transport of stolen goods under the National Stolen Property Act as long as the artifact’s nation of origin has enacted a law officially declaring state ownership of such artifacts. Furthermore, all of the various artifacts she retrieves will likely be returned to their nations of origin under the UNESCO 1970 Convention and CIPA.

Addendum

This analysis was focused specifically on the legal ramifications of the act of retrieving and transporting the artifacts central to the Tomb Raider games. In the course of the first game alone, Lara Croft also breaks into the corporate headquarters of Natla Technologies, kills a number of endangered animals (like wolves and gorillas, not to mention the sasquatch and dinosaurs), and also straight up shoots a guy without (much) provocation.

How legal is anything Lara Croft does? The short answer is, “Not very.”

X-Men: Days of Future Past and Thoughts on Due Process

This guest post was written by Joe Suhre, of Suhre & Associates, LLC, a firm with offices in Chicago, Illinois, Dayton, Ohio, and Columbus, Ohio. Joe previously wrote guest posts on Defending Loki and Captain America: The Winter Soldier.

The Most Important Movie of the Year?

Recently, US-authorized drone strikes killed several American citizens accused of being a threat to the country based on their terrorist affiliations and unapologetic rhetoric opposing US policy.

Oh, wait . . . that was the beginning of X-Men: Days of Future Past.

You probably already know that this article will have multiple spoilers, so if you haven’t yet seen the latest iteration of Marvel’s X-Men, you should go see it soon. Then come back and tell me in the comments whether you believe in my assessment of this film or not.

What’s the Big Deal?

If you have seen Days of Future Past already, did you see what I saw? I will admit it is somewhat hidden, but only because we are trained to ignore it, since it just gets in the way.

I am talking about due process—due process, as in the opposite of capricious verdicts and judgments based on prejudice, fear, and political expediency; as in that little right we inherited from our Founding Fathers, who had experienced the lack of due process first hand and decided the Constitution wasn’t complete until we included it in the Bill of Rights.

You might disagree with me when I say the framers of the Constitution had the events of X-Men: Days of Future Past in mind when they insisted that due process be inviolate, so let’s review the instances in the movie and then see if we face the same issues today.

First Class 

Everything really started at the end of X-Men: First Class when, in a mercurial moment, mutants went from heroes to goats on the beach in Cuba, incurring the wrath of the instantly allied US and Soviet fleets. The Soviets would obviously have no problem firing on a small contingent of Americans, but why did the generals calling the shots in Washington order the execution of US citizens without due process? And why were the American Sailors, so soon after World War II, willing to “just follow orders,” especially after hearing Agent MacTaggert screaming over the com that the situation was contained?

I guess their justification for such an attack was fear; fear based on ignorance and concern for safety. Which, by the way, is the same tactic currently exercised by law enforcement across the country. In fact, according to the Bureau of Justice Statistics, police kill 400 – 500 innocent people each year out of fear for their own safety, significantly more than the 33 officers killed by firearms each year in the line of duty.

A 2012 example of irrational fear in Cleveland, not unlike the attack levied against the mutants on the beach, involved a man and woman whose car backfired. The retaliation by police to the possible gunfire from the car resulted in a force of 60 police cars pursuing the now frightened couple and ended with 115 officers firing 140 bullets into the car in less than 30 seconds. The unarmed couple was pronounced dead on the scene.

Kennedy Assassination

Speaking of no due process, although the details were sketchy on how the US government accused Magneto of complicity in the JFK assassination, it is clear that government suspicion that Magneto manipulated the “magic bullet” was justification for his incarceration.

Of course, in 1963 Erik Lehnsherr’s incarceration was illegal, but now after several rounds in congress and many court challenges, the President on December 26, 2013 signed into law that the government can arrest anyone on suspicion only and detain them indefinitely without trial. Welcome to Magneto’s world.

Not that I subscribe to the rhetoric of Magneto, but you have to admit that being thrown in solitary without due process, tends to sap any loyalty one might have for King and country; whether you are a German Jew or a US Citizen of the wrong color, species, or ideology.

Vigilante Justice

One element of vigilante justice that makes it not only illegal but immoral as well is that the vigilante, lynch mob, or angry villagers with torches and pitch forks don’t feel bound by due process. Their aim is to dispense justice, quickly—right or wrong. What drives the vigilante is fear that justice won’t happen without them taking over.

Vigilante justice in Detroit occurred in April of this year when a man hit a 10-year old boy with his truck. The driver stopped to help but was immediately beaten into a coma in retaliation even though surveillance cameras would later show the boy ran in front of the oncoming truck leaving no time to stop. Concern for due process would have allowed the mob to see that the man was not at fault after a thorough investigation.

But in another universe, maybe the boy was a mutant, and his fellow mutants felt that there would be no justice unless they acted on their own. Thus was the mindset of Mystique as she set about finding and executing Trask. It all seemed clear what she had to do since nobody else was willing to stop Trask from continuing with his plans against mutants. Due process wasn’t on her mind, and as it usually does, her vigilante justice backfired.

Due Process and Personhood

Without getting into a history lesson on civil rights in America, one doctrine that kept slaves and minority races under the boot of the majority was the belief that they didn’t fully qualify as human. The majority claimed belief in rule of law, due process, and justice, yet denied an equal share of this philosophy to those deemed as “less human.” This belief also fueled the Holocaust in Germany, where enslavement and execution of “untermenschen” or “subhumans” was ok, to the tune of eleven million dead.

Trask was quick to play on this flaw in humanity when he was able to convince the powers that were, that mutants, by virtue of their differences also didn’t deserve consideration as humans and should be targeted as enemies. His deep seated prejudice was made plain when, suspecting a Vietnamese general to be a mutant, he said to others in the room driven to panic, “Don’t shoot it.”

Denying Due Process 

I dare say, in a classroom most students would see the injustice and immorality of denying human rights to any individual based on race. Maybe racist attitudes are fading away in our culture. Let’s hope so. But my discussion has not been about the obvious ethnic lessons of X-Men: Days of Future Past. I have been talking about due process and why we should be aware of its importance.

To whom are we willing to deny due process today? Do you think we should afford all people the right of presumed innocence? Or are some crimes so heinous that it is hard to restrain us from rushing to judgment and bypassing due process? Unfortunately, I have seen instances where many people feel that for some crimes due process isn’t important and should be suspended. Let me toss around a few words. Let’s see what your emotional response is to arresting:

  • Drunk drivers;
  • Terrorists;
  • Child molesters;
  • Rapists;
  • Drug dealers

A police officer arrests and handcuffs a man.

You have the right to . . . oh never mind, just get in the car @$&hole.

The question is, are we willing to trust our system of justice when it comes to these types of crimes? Or do we treat these individuals as “mutants . . .” to be feared and condemned as guilty before they are even tried? In the case of a drunk driving arrest, you are presumed guilty. Your license is suspended and you are given a notice of suspension. Police officers in these cases are judge, jury, and executioner. It is a very efficient system.

However, putting justice in the hands of the people can be slow. It was a risky move by the founding fathers. Many feel that people show too much mercy and not enough justice. They fight for mandatory sentences, new laws, and regulations that take authority away from the judge and jury. They allow exceptions to every right we have in an attempt to control our “unruly” system.

I like what Charles Xavier said to Raven at the end of X-Men, “I have been trying to control you since the day we met and look where that’s got us . . . I have faith in you Raven.” Perhaps we should have faith in each other as well.

Due process isn’t perfect, but it is fair. It is foundational to our freedom. In light of the alternative, it is a pretty big deal. Is it significant enough to suggest that X-Men: Days of Future Past is the most important movie of the year?

Ask me again in ten years.

A Comic Book-Inspired Law School Final Exam

Lawrence M. Friedman is a partner at Barnes, Richardson & Colburn, LLP and an adjunct professor at the John Marshall Law School’s Center for International Law.  He is also the author of the Customs Law Blog.  He sent me this final exam, which he recently gave in his Trade Remedies class.  According to Prof. Friedman, “I stressed to my students that the names and locations were not particularly relevant. Nevertheless, I have no doubt they are wondering what I was thinking. It is a bit of a scavenger hunt for random DC universe references, from the well-known to the obscure.”  Thank you to Prof. Friedman, and I hope you all enjoy reading it as much as I did!

IBT 705 International Trade Remedies Law

Spring 2014

Final Exam: The Dark Knight Edition

Instructions:

  1. To complete this exam, you may rely on your class notes, textbook, and a calculator. No other resources can be consulted.
  2. Read the facts below and respond accordingly. Credit will be earned by properly identifying legal issues, stating the relevant rules, applying the facts to the rules, and logically stating your advice to the client.

You are an associate in the International Trade Department of Grabemann, Loring and Ross in Ivy Town, USA. Jean Loring, one of the name partners, has called you into her office. She is meeting with a Mr. Alfred Pennyworth, who is there on behalf of your firm’s biggest client, Wayne Enterprises.  Ms. Loring and Mr. Pennyworth relayed the following facts to you.

From 2011 on, there have been only three companies in the United States that produce high quality bullet proof body armor. Those companies are Wayne Enterprises, Queen Consolidated, and Kord Industries. Wayne Enterprises produces approximately 60% of the body armor made in the United States. The remaining approximately 40% is divided evenly between Queen Consolidated and Kord Industries (each with 20%). Because of the nature of the product and federal government restrictions, there is a limited U.S. market for body armor.

The basic technology underlying the design and manufacturing of this body armor was invented by Lucius Fox, an employee of Wayne Enterprises. In 2008, Mr. Fox secured a patent covering the technology and its production. He assigned that patent to Wayne Enterprises, making Wayne Enterprises the owner of the patent. Wayne Enterprises has granted non-exclusive licenses to exploit the patent to both Queen Consolidated and Kord Industries. Wayne Enterprises also owns the U.S. trademark rights to “Ballistic Armor Technology” and “BAT” to describe the body armor. Both marks are registered with the U.S. Patent and Trademark Office and appear on the principal register of trademarks.

Somewhere in the central Asian republic of Nanda Parbat (a WTO member), a shadowy company called Demon’s Head Ltd. has been making inferior body armor and supplying it free of charge to the local criminal market. Mr. al Ghul, the president of Demon’s Head, has vowed to enter the U.S. body armor market with the express intention of pushing Wayne Enterprises, Queen Consolidated, and Kord Industries out of the market. That will allow Demon’s Head to sell BAT® body armor to members of the criminal underworld, making al Ghul the leader of a criminal army in the United States. To do that, al Ghul has enlisted the League of Corporate Assassins to launch his four-step plan.

  1. First, in 2011, al Ghul instructed his associate Antonio Diego to kidnap Mr. Fox in a successful effort to secure the information needed to produce BAT® body armor using the patented production methodology. Fox was later rescued unharmed by Wayne Enterprises Chief of Security Barbara Gordon.
  2. AlGhul then convinced RamaKushna, President ofNandaParbat, that additional exports to the United States would be good for the local economy. To help encourage economic activity, the President made three declarations having the force and effect of law as of January 1, 2012.
    1. All companies in Nanda Parbat that export goods are entitled to a credit against their overall corporate income tax liability equal to 1% of the value of the exported products.
    2. No bank in Nanda Parabat making loans to domestic producers of textiles and apparel may charge interest in excess of 3% per annum but the government will pay the bank to make up any difference between the 3% fixed rate and the prevailing market rate of 15% per annum.
    3. Every company in Nanda Parabat that employs more than 100 people will receive an annual grant to support on-site child care for workers’ children.
  3. Next, al Ghul instructed Anthony Ivo, Chief Scientist at Demon’s Head, to begin production of BAT-style body armor suits using Wayne Enterprise’s patented BAT® technology. This product proved to be far superior to his prior efforts, due to the stolen BAT® technology. As a result, in January 2012, Demon’s Head began selling body armor to the Nanda Parabat police and army for the dollar equivalent of $5000 per full suit (not including optional cape). At the same time, Demon’s Head continues giving away body armor suits to criminals in Nanda Parabat.
  4. Simultaneously, Demon’s Head began shipping body armor to the U.S., where it is imported by the Talia Distributors, a company set up and wholly owned by Demon’s Head. Mr. al Ghul is the president of both companies. Talia Distributors repackages, markets, and sells the body armor at wholesale to Cobblepot & Co., H. Dent Corp., and Sionis Systems Ltd. who sell to retail customers in the United States (both legal and criminal enterprises). Under a strict transfer pricing methodology, Talia Distributors pays Demon’s Head $2500 per full suit. The price to Cobblepot, Dent, and Sionis is set at $3000 per full suit. Talia Distributors keeps the $500 as a commission to cover its costs.

The influx of body armor from Nanda Parabat is taking a toll on the domestic industry. Felicity Smoak, who works for Queen Consolidated, prepared the following report showing declining sales of body armor suits in the U.S. At the same time, sales are increasing in Nanda Prabat. She also confirmed that Demon’s Head has no customers outside of Nanda Parabat and the U.S. However, Smoak identified significant potential markets for body armor suits throughout Europe; but, she does believes Demon’s Head is producing at capacity and lacks resources to serve additional markets.

United States
Wayne Queen Kord Demon Total US
2011 60,000 20,000 20,000 - 100,000
2012 57,000 19,000 19,000 5,000 100,000
2013 54,000 18,000 18,000 10,000 100,000
Nanda Parabat
Free Sales Total Nanda Parabat
2011 2,000 - 2,000
2012 2,500 2,000 4,500
2013 3,000 4,000 7,000

According to Pennyworth, to support its continuing massive investment in research and development, Wayne Enterprises wants to raise the price of BAT® body armor suits in the U.S. The U.S. price for a BAT® body armor suit from any of the three domestic producers is approximately $8,000 (not including optional cape). However, neither Queen nor Kord have moved prices upward to offset lost sales. To meet the competition, Wayne has been unable to increase prices and has, therefore, reduced R&D. To cut costs, Queen has fired Chief Marketing Office Roy Harper and will be consolidating its three sales and distribution centers into its main campus in Star City.

Kord has taken another approach. To cut costs and improve its overall profitability, Kord has decided to start production of BAT® body armor in the Balkan country of Markovia. As on January 1, 2014, Kord has shifted 50% of its production from the U.S. to Markovia. All of the Markovia-produced goods will be exported to the U.S. and imported by Kord.

Thus, the expected 2014 industry snapshot is as follows:

United States Sales
Wayne Queen Kord Demon Total US
2014 50,000 17,000 10,000
10,000
13,000 100,000
Origin USA USA Markovia/USA Nanda Parbat

The Kord and Demon’s Head imports will be competing for the same few legal customers in the U.S. while the imports from Demon will also supply the criminal market (about 10% of the total U.S. sales).

In January of 2013, Barbara Gordon of Wayne Enterprises’ reported that she has identified the unauthorized use of the BAT® trademark on inferior body armor being sold in the U.S. market. Her sources have provided shipping and commercial documents indicating that the unauthorized BAT® products are coming from Nanda Parabat.

Ms. Loring called you into the meeting with Mr. Pennyworth to help determine whether any U.S. trade remedy laws might help Wayne Enterprises offset the commercial competition from Demon’s Head. Mr. Pennyworth ominously suggested that fending off the threat from Demon’s Head and Mr. al Ghul has larger implications for the fate of the nation. He asked that you consider all options involving the trade laws. According to Pennyworth, the CEO of Wayne Enterprises is considering other options involving independent acts of self-help.

Ms. Loring has asked you to prepare a memo outlining any potential administrative or judicial actions you see as possible support for Wayne Enterprises. For each potential action, she wants you to explain in as much detail as time permits:

  • Whether Wayne Enterprises, alone or in conjunction with other companies, has standing to commence the action.
  • In what forum is the action commenced and how.
  • What proof will be necessary to secure a remedy?
  • What data will be considered and how will it be used?
  • What problems or opportunities do you see for Wayne Enterprises and the other companies?
  • For administrative action, what judicial review is available?
  • What is the standard of review applied by the relevant courts?
  • Will Wayne Enterprises be likely to prevail?

For no credit other than respect and bragging rights, provide the correct first and last names and popular aliases of the CEOs of Wayne Enterprises, Queen Consolidated, and Kord Industries and the first name of Mr. Pennyworth.

Captain America: The Winter Soldier

This guest post was written by Joe Suhre, of Suhre & Associates, LLC, a firm with offices in Chicago, Illinois, Dayton, Ohio, and Columbus, Ohio. Joe previously wrote a post on Defending Loki.

Introduction by James Daily: This post contains significant spoilers for Captain America: The Winter Soldier.  It’s a very good movie, and if you haven’t seen it you should definitely check it out!

Continue reading

Guest Post: Defending Loki

This guest post was written by Joe Suhre, of Suhre & Associates, LLC, a firm with offices in Chicago, Illinois, Dayton, Ohio, and Columbus, Ohio. Joe received a Criminal Justice degree from Xavier University and worked for 6 years as an auxiliary police officer. He later received his Juris Doctorate from the University of Cincinnati.

In the closing sequence of Marvel’s The Avengers, The World Security Council that evidently has the authority to order a nuclear strike on New York City, questions Nick Fury about the disposition of Loki. Calling Loki a war criminal, they ask Mr. Fury why he let Thor take Loki away when he should be answering for his crimes.

In this iteration of the Multiverse, evidently the bureaucracy of the United States has given way to the autocratic decisions of an infighting oligarchy that ignores due process and extradition laws. Well, at least Nick Fury does.

I think I would have rather seen a little more adherence to law and let Loki have his day in a U.S. Court. I say this, because as a criminal defense attorney, I believe there is a reasonable defense for Loki.

Loki’s Past, the Key to His Defense

Based on Loki’s actions and behavior, Loki’s best defense would have to be the truth—he is insane—but not a generic insane; Loki suffers from grandiose delusional disorder, a very complex psychosis where non-hallucination influenced delusions become core beliefs and the main motivation for daily activities.

Loki’s delusions began when he was very young. As his defense attorney, I would chronicle his delusions from early childhood on, showing how specific events helped create and support his grandiose delusions. I would produce expert witnesses and then introduce testimony from Loki’s past that would that Loki’s behavior is consistent with his delusions.

Establishing the Beginning of Loki’s Delusions

Loki was born the son of Laufy, king of the Frost Giants. Laufy kept his infant son in seclusion due to his non-giant size. Odin, leader of the Asgardian gods led his armies to victory against the Frost Giants where Laufy was killed in battle. Loki was discovered hidden in the giant’s main fortress. His size, considered diminutive by his own kind, was actually similar to Odin and other Asgardians. Odin took Loki back to Asgard and raised him alongside his biological son Thor.

Even though Loki was raised as a god in Odin’s court, he would eventually learn the truth; Odin, Loki’s father since he could remember, destroyed Loki’s true family. He would never be favored above Thor. He was a “god” by association, not by blood. Despite his home address, Asgardians did not respect him as they did Thor.

As Thor rose from favor to more favor, the contradictions in Loki’s circumstances drove him to seek out the dark arts and mischief.

Expert Witnesses

After going over his past, I would bring in a child psychiatrist as an expert witness who would explain how the tragic and ironic events in Loki’s life from infancy to adulthood led him to replace the realities of his life with delusions.

My next expert witness would be an adult psychiatrist who had interviewed Loki extensively. I would have him or her explain the complexity of delusion disorder to the court and describe Loki’s dominant delusions. Since I am not a psychiatrist, I don’t know everything a doctor would find. My assumption would be that Loki’s main delusions would be his belief that he is the rightful king of Asgard, that he is smarter than everyone, and that as king of Asgard he is the rightful ruler of Midgard (Earth).

Corroborating the Findings of the Experts

Expert witnesses are indispensable to back up an insanity plea but equally vital are the actions and statements of the accused that would back up the claims of the experts. My next witness would show examples of Loki’s behavior that matched the findings of my experts.

Some of the instances I would use would be the following:

  • Loki’s introduction in the Avengers, “I am Loki of Asgard, and I am burdened with glorious purpose.”
  • Loki demanding a crowd of people to kneel to him and when they do states, “Is not this simpler? Is this not your natural state? It’s the unspoken truth of humanity, that you crave subjugation. The bright lure of freedom diminishes your life’s joy in a mad scramble for power, for identity. You were made to be ruled. In the end, you will always kneel.”
  • You are, all of you are beneath me. I am a god, you dull creature, and I will not be bullied…
  • Bruce Banner’s assessment was also an interesting observation, “I don’t think we should be focusing on Loki. That guy’s brain is a bag full of cats, you could smell crazy on him.”

Interspersed between Loki’s moments of delusion are cases where he acts normal and even helpful. This is typical for grandiose delusion disorder since people suffering from the same exhibit normal behavior when they aren’t trying to advance their delusions.

Conclusions

This part of the trial would typically be quite lengthy because we are attempting to establish a severe mental illness that would explain his crimes and his mental state during that time. We would not dispute the facts of the case, only the intent of the accused and his ability or inability to distinguish the morality of his actions.

We may weave through our defense the “McNaughton rule.” This rule creates a presumption of sanity, unless the defense proves “at the time of committing the act, the accused was laboring under such a defect of reason, from disease of the mind, as not to know the nature and quality of the act he was doing or, if he did know it, that he did not know what he was doing was wrong.” The McNaughton rule is the standard for insanity in almost half of the states.

In 1972, the American Law Institute, a panel of legal experts, developed a new rule for insanity as part of the Model Penal Code. This rule says that a defendant is not responsible for criminal conduct where (s)he, as a result of mental disease or defect, did not possess “substantial capacity either to appreciate the criminality of his conduct or to conform his conduct to the requirements of the law.” This new rule was based on the District of Columbia Circuit’s decision in the federal appellate case, United States v. Brawner, 471 F.2d 969 (1972).

One of the most famous recent uses of the insanity defense came in United States v. Hinckley, concerning the assassination attempt against then-President Ronald Reagan.

In 1984, Congress passed, and President Ronald Reagan signed, the Comprehensive Crime Control Act. The federal insanity defense now requires the defendant to prove, by “clear and convincing evidence,” that “at the time of the commission of the acts constituting the offense, the defendant, as a result of a severe mental disease or defect, was unable to appreciate the nature and quality or the wrongfulness of his acts” (18 U.S.C. § 17). This is generally viewed as a return to the “knowing right from wrong” standard. The Act also contained the Insanity Defense Reform Act of 1984, 18 U.S.C. § 4241, which sets out sentencing and other provisions for dealing with offenders who are or have been suffering from a mental disease or defect.

The Verdict

Proving Loki’s delusion wouldn’t be difficult. However, on top of his grandiose delusion disorder is his Asgardian culture that believes in the glory of war, utterly destroying one’s enemies, and a totalitarian monarchy, that would further qualify him as being “unable to appreciate the nature and quality or the wrongfulness of his acts,” under Federal guidelines.

Even though John Hinckley, Jr. was found not guilty by reason of insanity, he has yet to be given unsupervised released from his hospital. Loki would most likely receive similar treatment after his verdict. However, maybe after 100 years of therapy and counseling Loki could be cured and lead a normal autocratic warrior life in Asgard.

“Holy Secret Recipe, Batman!”: Superheroes, the Misappropriation of Trade Secrets, and Economic Espionage

(This guest post was written by T. Stephen Jenkins, an associate in the Commercial Litigation Practice Group of Pepper Hamilton LLP.)

While Law and the Multiverse has featured several posts on various forms of intellectual property law (e.g. patent, copyright, and trademark), it has yet to discuss trade secrets . . . until now.  Trade secrets commonly appear in comic books, and given the recent concern with computer security and the alleged theft of trade secrets by domestic and international hackers, theft of trade secrets is a worthwhile topic to discuss.  (Warning:  minor spoilers ahead)

 

I. What IS a Trade Secret?

A person or company holding a trade secret, as its name suggests, seeks to safeguard information that is known by the person or company that is not readily known by anyone in the public.  Trade secrets can overlap with other forms of intellectual property, such as non-patentable inventions, trade dress, and “know-how.”  However, unlike many other forms of intellectual property where recovery of damages might be limited by lack of federal registration (disclosure) of the intellectual property (e.g. copyrights and patents), generally speaking, a trade secret holder may be able to recover damages if he or she maintained a reasonable level of protection to prevent non-disclosure of the trade secret.  The Uniform Trade Secrets Act (“UTSA”), which 48 of 50 states have adopted (or introduced) in some form, defines a trade secret as

(1) information, including a formula, pattern, compilation, program, device, method, technique, or process, that (2) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (3) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Uniform Trade Secrets Act §1, ¶ 4.

Trade secrets are common—and even famous—in the real world.  One of the most famous examples is the Coca-Cola secret recipe, which, for years has been guarded and has been the subject of threats of economic espionage.  Other examples of famous trade secrets include KFC’s “11 herbs and spices” and Google’s search algorithm.  Even less apparent examples of trade secrets have gained fame including the methodology for creating the New York Times Best Sellers’ list and Starwood Hotels’ (the owner of Westin hotel chain) luxury ambience.  Each of the above satisfies the three elements of the UTSA definition of a trade secret.

First, each example easily satisfies the information prong.  See  1-1 Milgrim on Trade Secrets § 1.01 (“The classic definition of trade secrets is stated at § 757, comment b, of the 1939 Restatement of Torts. . . . It covers any information (which can be embodied in a physical thing . . .”).  Second, because some have attempted to either unlawfully misappropriate and/or reverse-engineer the above trade secrets, it is probably safe to assume each trade secret has independent economic value in not being generally known.  Third, all are highly protected (though safeguarding all the details that create a Starwood Hotel’s luxury ambience is undoubtedly challenging).

Given the broad definition of a trade secret under UTSA, one can see how patterns, formulas, or devices in the Multiverse likely qualify as trade secrets.  The challenge is demonstrating whether these secrets have economic value.

The most famous comic book trade secret may be the Super Soldier Serum that created Captain America (and other characters), which many have tried to misappropriate (e.g. the Red Skull) and reverse engineer (e.g. the Green Goblin).  Though the Super Solider Serum was the product of government military research, there is a strong case that is has economic value.  Many villains and fictional enemies of the United States have tried to misappropriate the secret formula and use it either to gain a military advantage or to create a steady supply of mercenaries for hire.  Therefore, it is reasonable to assume that the Super Soldier Serum could meet the trade secret requirements.

Other examples might include:

  • Devices:  Spider-Man’s webshooters and Batman’s gadgets;
  • Programs/Patterns:  X-men Danger Room (depending on whether or not it is sentient) and Cerebro/Cerebra;
  • Methods/Techniques/Processes:  The method to access the Speed Force and the process of joining adamantium to Wolverine’s skeleton;
  • Formula: Vibranium and its derivative uses including Captain America’s shield, the Super Solider Serum, and the Anti-Life Equation;
  • Information/Compilations:  S.H.I.E.L.D.’s database on superheroes and villains and Justice League’s/X-Men’s/Avengers team-up database.

A superhero’s secret identity (within the Multiverse) may also be a trade secret, though not as easily established as the above.  See the Law and the Multiverse’s post on secret identities and privacy for an analogous argument.  For public superheroes such as those registered under the Marvel Universe’s Superhuman Registration Act, their secret identities may not enjoy trade secret protection.  However, other superheroes have had to protect their secret identities against those trying to kill them or sell their secret (e.g. Spider-Man).  They have also obtained benefits in their non-superhero professions from keeping their superhero identities secret (e.g. Peter Parker (photographer) / Spider-Man, Clark Kent (journalist) / Superman, and Matt Murdock (attorney) / Daredevil)).  Thus, for these superheroes, a secret identify might qualify as a trade secret.

 

II. What Laws Protect Trade Secrets?

In contrast to patents, copyrights, and trademarks, which federal law either establishes and/or strongly protects, trade secrets’ protection mostly arises from state law, though recently, international and federal protection of trade secrets has increased.  Most states have adopted UTSA in some form, which provides for civil actions for injunctive relief and damages within three years after misappropriation is discovered.  Two U.S.-signed treaties, the Agreement on Trade Related Aspects of Intellectual Property Rights (“TRIPS”) and the North American Free Trade Agreement (“NAFTA”) also provide some protection.

Recently, the federal Economic Espionage Act (“EEA”), 18 U.S.C. §§ 1831 et seq.,  and the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030 et seq., have become enforcement tools against criminal misfeasors.  Both the EEA and the CFAA provide harsh civil and criminal penalties for the trade secret theft. See 18 U.S.C. §§ 1831 et seq. (providing for fines up to $10 million and/or 15 years imprisonment for economic espionage or trade secret theft); 18 U.S.C. § 1030 et seq. providing for unspecified fines and/or up  to 20 years imprisonment).

 

III. Who in the Multiverse Has Violated the EEA or the CFAA?

Though there are several examples of potential violations of the EEA and the CFAA in the Multiverse, a favorite comes from Marvel Entertainment’s popular Iron Man “Armor Wars” storyline (for a DC Comics example, see the mini-series aptly named The Hacker Files).

 

A. The Facts

“Armor Wars” is an Iron Man story arc that has appeared in many of Marvel’s comic book series.  In addition, it was featured in the second season of the Iron Man:  Armored Adventures televised cartoon.  In the Iron Man:  Armored Adventures version, Tony Stark is a teenager balancing being a superhero and a high school student.  Tony’s main antagonist is Obadiah Stane, who ousted Tony from the family company Stark International.

Stane, then Chair of the Board of Stark International, enlists Ghost to steal the Iron Man armor specifications.  Ghost goes to Tony’s hideout to steal the specs from Tony’s computer.  Stane also makes a deal with Doctor Doom, handing over the armor specs to Dr. Doom in exchange for help with creating a version of the armor for Stane.  Using Tony’s armor specs, Stane creates his own version of the Iron Man armor, becoming Iron Monger but is exposed as being involved with Ghost.  Ghost also sells the Iron Man armor specs to Justin Hammer (in this version a 21-year old spoiled rich kid), who creates his own version of the Iron Man armor, becoming Titanium Man.

 

B. Is There a Cause of Action Under the EEA or the CFAA?

While the cartoon takes a different approach to resolve the problem, consider whether a prosecutor or Tony could bring a claim under the EEA or the CFAA against (1) Ghost, (2) Stane, (3) Dr. Doom, and (4) Hammer (collectively, the “Misfeasors”).

 

1. Economic Espionage Act

Under the EEA, a prosecutor or Tony could bring claims of both theft of trade secrets (42 U.S.C. § 1832) and economic espionage (42 U.S.C.§ 1831).  The EEA makes it unlawful for a person to steal a trade secret and transmit it to a person who knows he or she is not authorized to possess it.  The EEA also makes it unlawful for a person to steal a trade secret with the purpose or knowledge that the delivery of the trade secret will benefit a foreign government (economic espionage).

The Misfeasors are all potentially liable for theft of trade secrets.  The EEA provides that “[w]hoever, with intent to convert a trade secret . . . steals, or without authorization,” or “appropriates . . . information” or “receives, buys, or possesses such information” or “attempts . . . or conspires . . . to commit any offense” described above shall be subjected to fines and/or imprisonment.  First, the Iron Man armor specs, at least in this storyline, are trade secrets  because they meet all the requirements under UTSA (see above Captain America/Super Soldier Serum analysis).  Moreover, the reason Stane and Hammer pay Ghost to steal the specs is because they want to derive economic value.  Second, the Misfeasors were involved in a conspiracy to misappropriate the specs:  Ghost stole the specs; Stane and Hammer bought the stolen specs, and Dr. Doom received the stolen specs.

However, not all of the Misfeasors are clearly liable for economic espionage under the EEA.  The EEA’s economic espionage provision is conceptually the same as its theft of trade secret provision, but requires that a misfeasor transmit a trade secret “intending or knowing that the offense will benefit” a foreign government or agent.  Here, the foreign government or agent is Latveria or Dr. Doom, respectively.

Hammer is likely not liable for economic espionage because it would be difficult to prove that he intended or knew that Dr. Doom would gain the armor specs.  In contrast, Stane and Dr. Doom are likely liable because they conspired for Dr. Doom to obtain the specs.  But the trickier case is Ghost who was happy to sell the specs to highest bidder.  Because it was Stane and not Ghost who gave the specs to Dr. Doom, Ghost can argue that he did not intend or know that his theft would benefit Dr. Doom.  However, given that “a conspiracy can exist even if each participant does not know the identity of the others or does not participate in all the events,” cf. United States v. Monroe, 73 F.3d 129, 131 (7th Cir. 1995) (internal citations omitted), Ghost’s argument may fail.

 

2. Computer Fraud and Abuse Act

The Misfeasors are also likely liable under the CFAA, which provides that “[w]hoever . . . knowingly accessed a computer without authorization or exceeding authorization . . . obtain[s] information that has been determined by [U.S. law] to require protection against unauthorized disclosure . . . [and] transmits . . . or conspires [to transmit]. . . to any person not entitled to receive it” will be subject to fines and/or imprisonment.  18 U.S.C. § 1030 (a)–(c).  The analysis under the CFAA is similar to the theft of trade secret analysis but requires that the information be obtained from a “protected computer.”  Under the CFAA a protected computer is either (1) a computer “exclusively for the use of a financial institution or the United States Government, ”18 U.S.C. § 1030(e)(2)(A), or (2) a computer used in “interstate or foreign commerce or communication,” 18 U.S.C. § 1030(e)(2)(B).  The latter requirement is a low standard to meet

Tony’s computer is a protected computer because it was used in interstate communication.  Thus, the Misfeasors could be facing years of imprisonment or at least hefty fines.  Dr. Doom may escape penalty given that, as the sovereign of his own country, he will likely not extradite himself for prosecution.  And if the U.S. government came after Dr. Doom or any of the Misfeasors, it would likely take years to reach a resolution, which is probably why the story arc’s writers resolved the issue in a much swifter way.

Using the EEA and the CFAA to pursue real-world misfeasors may increase in the coming years.  The EEA and the CFAA give federal prosecutors—and to a lesser extent civil litigants—broad power to prosecute alleged misfeasors, making even attempts to misappropriate trade secrets actionable.  “The Department of Justice has made the investigation and prosecution of corporate and state sponsored trade secret theft a top priority. . . . The FBI is also expanding its efforts to fight computer intrusions that involve the theft of trade secrets by individual, corporate, and nation-state cyber hackers.”  See Office of the President, Admin. Strategy on Mitigating the Theft of U.S. Trade Secrets at 7.

While there are many proponents and opponents of their use, there is no doubt that the Economic Espionage Act and the Computer Fraud and Abuse Act have had profound effects.  Of course, you can always come to Law and the Multiverse to see how the EEA and the CFAA continue to affect super powered individuals—and Pepper Hamilton LLP if you ever need real-world advice.

Mutant Discrimination: GINA, Genetics and How Professor Xavier is Breaking the Law

This guest column was contributed by Dan Vorhaus, an attorney at Robinson, Bradshaw & Hinson, P.A. and Editor of the Genomics Law Report.

Previous posts here at Law and the Multiverse have discussed the status of mutants under several of our nation’s anti-discrimination laws, including the applicability of constitutional protections afforded by the Equal Protection and Due Process clauses of the 14th amendment and statutory protections afforded by the Americans with Disabilities Act (ADA).

There remains, however, one key piece of important anti-discrimination legislation that has yet to be considered in evaluating the legal protections afforded mutants under the law: the Genetic Information Nondiscrimination Act, or GINA.

I. GINA and Mutant Genetics: A Primer.

GINA represents a historic achievement. Enacted in 2008 after 13 years of debate, many have called it the “first civil rights bill of the 21st century.” Five years later it remains the first and only piece of federal legislation to specifically address the use and effects of genetic information.

Broadly speaking, GINA is divided into two parts. Title I of GINA prohibits health insurers from using genetic information to deny coverage or to set premiums or payment rates. Title II prohibits employers from requesting genetic information or using genetic information in hiring, firing and other employment-related decisions.

GINA’s unique focus on genetic information makes the law of particular relevance to mutants. “Mutants,” as we now know thanks to decades of research by devoted and largely off-panel comic book scientists, are individuals who possess at least one mutated copy of the so-called “X-Gene.” The gene appears to promote the development of superhuman powers and abilities, typically post-puberty.

While much remains unknown about the X-Gene’s structure and function, scientists specializing in mutant genetics have isolated its protein product(s) as evidenced by the deployment of mutant suppression drugs in X-Men: The Last Stand (the drug in question is derived from the mutant Leech). From this we can extrapolate that the location of the X-Gene in the Homo sapiens genome is known and, importantly, that mutations within the gene can be identified through genotyping or even targeted sequencing of the X-Gene itself.

With the identification of the X-Gene and the subsequent decline in cost of genomic sequencing technology, there are a number of scenarios in which a genetic test to “diagnose” a mutant at an early stage, particularly before he or she has developed any superhuman (and frequently super-destructive) abilities, might be desirable. But in light of GINA’s passage, are such genetic tests legal?

II. Mutant Discrimination in a Post-GINA World.

We start with a pair of scenarios in which genetic testing for the X-Gene might be of interest.

First, a health insurer could require applicants to submit to testing in an attempt to screen in individuals with beneficial mutations (e.g., those resulting in unique healing abilities) or screen out individuals with X-Gene mutations capable of generating catastrophic levels of claims exposure (e.g., as a result of an at-times-uncontrollable ability to rearrange matter), thereby helping to more accurately project the insurer’s exposure.

Second, an employer might use the X-Gene test to gain valuable insight about a prospective hire. For instance, a research laboratory might use the X-Gene diagnostic test to double-check that the reserved but well-qualified physicist it is considering for an open position won’t demolish the lab – and everyone and everything within it – if an experiment goes awry.

Prior to GINA’s passage, testing in either scenario would have at least been arguably permissible, although various other anti-discrimination laws, including those discussed in previous posts, might have served as the basis for an effective challenge. Post-GINA, however, the analysis is crystal clear: both of the above examples of X-Gene screening are illegal.

The text of the statute itself offers no ambiguity:

  • A health insurer “...shall not request, require, or purchase genetic information for underwriting purposes.” (§ 101)
  • It is unlawful for an employer “to fail or refuse to hire, or to discharge, any employee, or otherwise to discriminate against any employee with respect to the compensation, terms, conditions or privileges of employment of the employee, because of genetic information with respect to the employee.” (§ 202)

 Although Congress did provide limited exceptions to the general prohibition on requesting and using genetic information in the insurance and employment contexts, none of the exceptions are targeted at mutants, tests specifically designed to test for X-Gene mutations or are otherwise applicable to the scenarios discussed above.

III. Professor Xavier and Pro-Mutant Genetic Discrimination

While GINA may operate to protect mutants from certain forms of genetic discrimination, we should not forget that the statute is crafted broadly and protects against the misuse of any individual’s genetic information. In other words, just as mutants are protected by GINA, so too are they bound by it.

Consider the case of Professor Xavier’s world-renowned school, variously referred to as “Xavier’s School for Gifted Youngsters” and the “Xavier Institute for Higher Learning.”

While little is known of Xavier’s closely-guarded school, it appears to satisfy the definition of an employer subject to Title II of GINA. (GINA applies to all private employers with 15 or more employees. With roughly a dozen identified faculty members, and likely additional faculty members and administrative and support staff on the payroll, Xavier’s school likely crosses the 15-person threshold.)

Xavier’s school also has an unbroken track record of employing mutants as faculty. While it may seem logical and even desirable to employ mutants in a school dedicated to the education and training of mutants, GINA prohibits the use of genetic information in hiring and other job-related decisions without exception. Even in situations where genetic information might appear to be a legitimate criterion for assessing fitness to perform a particular job, GINA forbids its use by an employer.

Of course, it is highly unlikely that Xavier requires prospective faculty members to submit to a traditional genetic test as a condition of their application and/or hiring. In addition to his well-known psionic powers which allow him to identify mutants using only his mind, many or all of the individuals applying to work at the school have manifest mutant powers. Nevertheless, GINA is clear that genetic information, however acquired, may not be used “in regard to hiring, discharge, compensation, terms, conditions, or privileges of employment.” 29 CFR § 1635.4. No matter how he comes by the information, if Xavier is indeed using genetic information in employment-related decisions, this would be a clear violation of GINA.

Since none of Xavier’s existing faculty members are likely to bring a discrimination claim, how might one arise? The most likely scenario: a gifted but non-mutant individual, perhaps one even possessed of other superpowers derived from, for example, an alien genesis or technological enhancements, seeks a position at Xavier’s school as an instructor but is turned away. Such an individual would be well-positioned to bring a successful genetic discrimination claim under GINA against Professor Xavier and his school. The Equal Employment Opportunity Commission (EEOC), the federal agency responsible for enforcing Title II of GINA, provides detailed instructions for filing just such a charge.

As with any new piece of legislation, it will take some time before GINA’s full implications for both mutants and humans become clear. Final regulations for Title II of GINA were published in 2010, but public examples of GINA-in-action remain few and far between, and illustrate the many uncertainties and difficulties of enforcement.  For example, given the EEOC’s difficulty subpoenaing documents from Nestle in a recent enforcement action, one can only imagine the considerable challenges that would await the Commission in attempting to gather the evidence needed to successfully establish a claim of discrimination under GINA.

Nonetheless, the law of GINA is clear, and the coming years may require the Commission and other regulatory bodies to overcome those challenges in order to appropriately enforce GINA both for and against the mutant population. Count on Law and the Multiverse and the Genomics Law Report to continue to keep you apprised of all the latest in GINA, mutants and genetic discrimination law.

Pirate Cinema by Cory Doctorow

This guest post was written by Stuart Langley, an intellectual property attorney.  Thanks to Stuart for this fantastic post!  If you are a legal professional (e.g. an attorney, judge, or law professor) or a comic book professional (e.g. an author, editor, or illustrator) and  you have an idea for a post that would be a good fit for Law and the Multiverse, feel free to contact us!  

Cory Doctorow’s novel Pirate Cinema is a 2012 young adult speculative fiction novel set in near-future England that follows roughly a year in the life of a band of footloose youths living in, around, and outside traditional London society.  The story is told from the perspective of 16-year old filmmaker Trent McCauley (a.k.a. Cecil B. deVille) who’s obsession is creating mashups using images from the net.  Guided by his vagabond friends Jem, Dodger and a young woman named “26”, Trent matures from filmmaker to copyright activist.  

If you haven’t read Pirate Cinema, as always with Doctorow’s books you can download it for free, or you can do as I did and buy a copy.

Cory Doctorow is well-known for both his fiction and his informed, thoughtful copyright activism.  Pirate Cinema takes clear positions on copyright issues, but what is exceptionally fun about Pirate Cinema is the energy Doctorow puts forth to set out the whole cornucopia of property issues so we may consider law and theory.  Rather than steadfastly advocating a position, Pirate Cinema advocates advocacy itself; advocacy informed by human needs, respectful of human institutions created to meet those needs, and appreciative that these systems are changeable to satisfy our needs.  I will focus not on copyright issues per se, but the much more interesting context Pirate Cinema creates for understanding copyrights in the scheme of property law.  Pirate Cinema asks us to wonder about whether the way we treat intellectual property follows how we treat other kinds of property.

But first, Trent’s adventure begins when his family’s internet access is disconnected because of his downloading activity.  Is internet access a public utility subject to a higher “obligation to serve” standard, or merely a contractual service that can be denied for violation of any agreed upon term of service?

I. Is Internet Access a Public Utility?

Trent’s home has received a series of notices telling them their IP address has been associated with illegal downloading.  These notices go unheeded because Trent has intercepted them.  The third notice is accompanied by an appealable, but immediate one-year suspension of the family’s internet access.  The appeal process is portrayed as too burdensome and slow to pursue.

The McCauley’s internet access has been disconnected consistently with what appears to be an implementation of the United Kingdom Digital Economy Act 2010.  Implementation of this act has been slow, but is expected to lead to notices and service disruption as early as 2014.  The implementing code of this act obligates ISPs to respond to copyright infringement reports by notice to subscribers, maintain a list of subscribers that have received notices which can be disclosed to copyright owners under court order, and degrade or deny service to repeat offenders.  The technical measures imposed by the law will be appealable; on paper the appeal processes appear designed to protect subscribers, however, the regulations on the appeal process have not yet been published.  This foundational scenario in Pirate Cinema is plausible.

But whether it is acceptable to cut off internet access as punishment for violating how that service is used is another question.  Because of the disconnection Trent’s father cannot find work, his mother cannot find medical care, and his sister’s schooling suffers.  Is internet access is a public utility that should be more difficult to disconnect than summary and unilateral administrative action?  As explained in Jim Rossi’s article Universal Service in Competitive Retail Electric Power Markets: Whither the Duty to Serve? 21 Energy L.J. 27 (2000), common law principles express a public utility having a higher obligation to provide service—to provide extraordinary levels of service, especially to small residential customers.  These obligations include the duty to extend service, provide continuing reliable service, provide advanced notice of disconnection and to continue service even though a customer cannot make full payment.  Public utilities can have terms of service and can terminate service for violations, commonly payment and safety related transgressions.  One U.S. city proposed to cut off utility service for failure to pay speeding tickets, although using utility service as a tool to enforce other regulations seems very unusual and inconsistent with the common law “duty to serve”.  The question posed by Pirate Cinema is timely as governments try to regulate internet access, they do so by treating it as a public utility.  This will be a double edged sword in that one treated as a utility, society should, perhaps, have a higher duty to provide internet access and similarly higher barriers before disconnecting service, including greater due process and evidentiary protections for subscribers.

II. Property Rights in Pirate Cinema

Trent learns quickly how to live without money.  He needs food, he needs shelter, he needs comforts of water and electricity and, significantly, he needs to create films.  Without money the satisfaction of these needs brings Trent face-to-face with all types of property theory and practice.

The origin of property rights–the question of how something moves out of “the commons” to become the exclusive property of an individual is found in variations of “first possession theory” and the more thorough Natural Rights theory advocated by John Locke.  According to these theories property rights arise from the human ability to take something from nature, or the commons, and improve it and put it to use.  This act of taking from the commons gives the taker ownership in the thing taken.

Laws and social institutions have evolved to manage property rights, how they are granted and retained, and what privileges are granted to those that possess them.  These institutions and laws are the creation of man as well, and in spite of the strength of our belief that they are immutable, these institutions change over time to meet the needs of society.  Pirate Cinema asserts that property rights are enforced by political entities and powerful corporations and asks us to think about whether our existing institutions and laws are adequate with the reminder that we can change them to better meet society’s needs.  Paramount of those societal needs is the efficient and effective distribution of resources in our quest to satisfy human needs such as the need to eat, the need for shelter, and the more abstract needs to be comfortable, to share knowledge, and to be creative.

A. Tangible Property: Discarded Goods

Pirate Cinema’s society is characterized by great poverty and apparent abundance of resources being wasted.  At Waitrose, an upmarket grocer in London, Trent has a sinking feeling they might be about to shoplift.  Shoplifting is a crime and Trent is no thief.  Instead, his guide Jem teaches him to gather discarded food from the skips (dumpsters) behind the grocery which provide such abundance that they share this bounty with the less fortunate.  Similarly, they acquire all manner of computer and audiovisual equipment, all discarded.  This contrast—the repulsion of stealing against the acceptance of taking discarded goods—lets us think about when tangible property rights make sense and when they do not.  But is this a difference recognized in law?

Trent is right, people found guilty of shoplifting in the UK are charged with theft under the Theft Act 1968 and repeat offenders risk jail time.  However, can he take those same goods from a skip when discarded?  In the UK, no.  Dumpster diving in England and Wales may qualify as theft within the Theft Act 1968 as well.  However, there is little enforcement in practice.  In England, unless aggravated, theft from a skip will only be a civil wrong.  This non-uniform enforcement suggest that society, like Trent, views these acts differently, with a higher regard for personal property in some circumstances (e.g., when it is inside a store, while the owner is exercising dominion, and when taking property would cause loss to the property owner) than in other circumstances (e.g., once the owner has abandoned the property and would no longer suffer loss by the property being taken).

B. Real Property: Adverse Possession

Later, Trent and Jem take up residence in an abandoned pub they name Zeroday and claim it as their own under adverse possession laws.  Can they hope to own the pub where they take up residence?  Their actions to improve the property and put it to better use appeal to the natural law theory of property.  Acquiring real property by “adverse possession” is the process by which a person who is not the legal owner of real property can become its owner after having occupied it for a specified period of time.  The Land Registration Act 2002 provides a legal scheme by which a person wishing to claim adverse possession of registered land would need to continuously occupy the land for ten years, or for a period of twelve years if the land is unregistered.  Pirate Cinema accurately describes the adverse possession law, although the youth’s rigid interpretation of notice provisions and continuous occupation are likely overstated.  Just as importantly, when the pub’s new owner appears, destroying the adverse possession claim, Trent readily yields to the new owner, apparently acknowledging both the new owner’s claim in law and the natural rights principle that although he could claim property from the commons, he could not claim property owned by another.  Once again, the contrast presented suggests our laws and culture give high regard to real property rights in some circumstances and less regard in other circumstances such as when the property is abandoned and can be put to better use.

C. Abstraction of Electricity

In a third property-like scenario, the pub’s power is originally restored by Dodger, Jem’s friend who bypasses the meter.  Not long after, the authorities forcibly remove the residents of Zeroday for “abstraction electricity”.  Electricity is not property in the UK and cannot therefore be stolen.  See the Crown Prosecution Service citing Low v. Blease Crim L.R. 513 (1975).  However, under section 13 of the Theft Act 1968, electricity used without due authority, or dishonestly wasted or diverted is charged with the offense of abstracting electricity.  Trent and the inhabitants of Zeroday unwillingly recognize this authority, vacating Zeroday as punishment for this crime.  Later, when they wish to re-habit the pub, the youths avoid this problem by installing a pay as you go service.  Consistent with the “duty to serve” notion, so long as the youths pay for their service the utility did not deny them service even though they do not own the property.  The contrast presented here is not in conflicting views of the law, but in that Trent does reluctantly but willingly commit the crime, and then agrees with the terms of service and his obligation to pay for services.  Trent acknowledges his needs alone do not justify theft, or abstraction, of what is rightfully “owned” by another.

III. Conclusion

So now our table is set; we have before us examples of when property rights systems work, and when they don’t.  We have examples of when it is right to acknowledge the rights of an owner and when we should question the scope of the powers conferred by those property rights.  Is internet access more like electricity we should be hesitant to withhold, or is it more like tangible or real property where theft laws are rigorously enforced?  Are downloaded clips more like real and tangible property in which we consistently recognize broad rights of owners, or discards from the skips where society implicitly or explicitly accepts that in spite of laws to the contrary, we restrain our enforcement of owner rights in favor of more effective ways of meeting human needs?

Pirate Cinema does not answer these questions for us.  It urges us to appreciate our own responsibility in defining property rights and systems of crime and punishment that meet human needs, including and most dearly the human need to create.  More than anything, the tale urges us to decide, and to learn about the law and regulation being created to regulate society, and take an active part in how those laws are made.

Futurama: Future Stock

This guest post was written by Craig Messing, an attorney from New York, who contacted us with this excellent idea for a post.  If you are a legal professional (e.g. an attorney, judge, or law professor) or a comic book professional (e.g. an author, editor, or illustrator) and  you have an idea for a post that would be a good fit for Law and the Multiverse, feel free to contact us!  

Introduction

Future Stock is the 21st episode of the third season of Futurama.  While somewhat outside this blog’s normal purview of comic-related media (even if there are Futurama comics), the episode touches on some unique, obscure, and even speculative issues of corporate governance and probate law.  As most of the series takes place in “New New York,” we will assume New York law applies, albeit 1000 years into the future.  It should go without saying, but spoilers to follow.

I. Background

In the episode, a shareholder meeting of Planet Express leads to an “80’s guy” (referred to throughout the episode only as “That Guy”) being named chairman of the corporation.  This eventually leads to That Guy trying to sell the company and gut it for profit, and a shareholder vote over the sale.  That Guy wins the shareholder vote, but then dies (fairly gruesomely) before the transaction is concluded.  Control of his shares passes to Fry, as vice-chairman of Planet Express, who votes down the sale.  (This ignores the fact that the vote had already been cast and approved by both companies, and thus should be binding, even after That Guy’s death.)  The issues here are multiple, but we will look at two.  First, we will examine what recourse the other shareholders of Planet Express might have had to block the sale, and the likelihood of success of those efforts.  Second, we will look at whether control of That Guy’s shares should have passed to Fry, and the potential consequences if they had not.

II. Oppressed Shareholders

In the episode, That Guy purchases 51 percent of the voting rights from Zoidberg (“The shares were worthless, and he kept asking for toilet paper!”), and imposes his will on the other shareholders, all of whom vote against the sale.  The remaining shareholders are outraged, but are powerless to affect the situation.  At face value, this would seem to be textbook shareholder oppression, in which the majority shareholder(s) imposes his will, to the detriment of the other minority shareholders.  Oppression can be especially prevalent in close corporations, where there are only a limited number of shareholders – as appears to be the case with Planet Express.  (Note: after the sale is completed, all outstanding shares of Planet Express are said to be purchased “at the current market price.”  But as a close corporation, there would not be a “market” price.  This is likely an oversight of convenience by the writers, however.) 

Oppressed minority shareholders may sue to prevent the oppressive actions of majority shareholder(s).  However, New York courts have defined “oppression” as “conduct that substantially defeats the reasonable expectations held by minority shareholders in committing their capital to the particular enterprise,” and held that oppression exists “only when the majority conduct substantially defeats expectations that, objectively viewed, were both reasonable under the circumstances and were central to the petitioner’s decision to join the venture.”  In re Matter of Kemp & Beatley, Inc., 473 N.E.2d 1173, 1179 (N.Y. 1984) (internal quotations omitted).   In other words, shareholder oppression will be found only if a “reasonable person” in the shareholders’ situation would be unhappy.

In this case, a “reasonable” Planet Express shareholder would likely be ecstatic at the results of the sale.  In the initial shareholder meeting, where That Guy is named chairman of Planet Express, the company’s dismal financial state is firmly established: a pie chart is shown, illustrating the company’s revenues; a minority of the pie accounts for revenue from business operations, while the majority is made up by “an eight-dollar bank error in our favor.”  After the vote on the sale is finalized, however, the market (“purchase”) price of Planet Express is given as $107.  It would be very difficult to argue that a “reasonable” minority shareholder would disapprove of a transaction that so drastically increased shareholder value, and thus the oppression argument would likely fail.

III. Descendability, Intestacy, and Escheat

Almost immediately after the vote approving the sale, That Guy dies, Fry takes control of his voting shares as vice-chairman, and negates the sale.  However, the corporation could only assert control of these shares if there was some sort of repurchase agreement with Planet Express, under which it could buy back the shares upon That Guy’s death.  Further, even if such an agreement did exist, That Guy’s shares would be either retired or turned into treasury stock; in either case, the shares would no longer have any voting rights, and if the sale of Planet Express had not already been finalized, the minority shareholder votes against the deal would carry the day without Fry’s last-minute heroics.  However, there is no mention of such an agreement in the episode, and thus there is no reason why That Guy’s shares couldn’t pass under his will, or failing that, under the law of intestacy … except that, again, there is no mention of That Guy having a will, nor any heirs, – nor is there any indication of That Guy having a family in the 1980s that might have propagated and survived into the year 3000.

More importantly, New York law might not allow for such distant relations to inherit through intestacy, even if they did exist.  Article 4 of the New York Estates, Powers and Trusts Law (EPT) governs intestate estates, and section 4-1.1 of the EPT enumerates the various classes of individuals who can take under New York law, allowing only for the decedent’s spouse, issue, parents, “issue of parents” (i.e. brothers and sisters of the decedent), grandparents (as well as “the issue of grandparents,” i.e. aunts and uncles), and “great-grandchildren of grandparents” (i.e. nieces and nephews) to take.  There is no provision for an individual outside of that closed list to take under intestacy, and as such, even if an heir does exist, it would be a very distant relation, well outside the purview of the EPT.  Apparently, New York has yet to account for time-travel and cryogenics (both of which appear to be fairly common in the future) in its probate code.  Quite the oversight.

Presuming that New New York law has not yet corrected this oversight, then That Guy’s apparent lack of both a will and eligible intestate heirs would cause the doctrine of escheat to come into effect.  Under escheat, a state acts as a sort of heir of last resort, and may take property if no other heir can be ascertained, or if property is abandoned.  See, e.g. N.Y. ABP § 102 (“It is hereby declared to be the policy of the state … to utilize escheated lands and unclaimed property for the benefit of all the people of the state, and this chapter shall be liberally construed to accomplish such purpose”).  It is not unheard of for a state to take corporate stock under escheat; in fact, such an action was expressly upheld in Standard Oil Co. v. New Jersey, 341 U.S. 428 (1951).

Escheat in New York is governed by the New York Abandoned Property Law; escheat of securities is specifically addressed in Article 5.  However, for a security to be “abandoned” – which was an implicit requirement under the Standard Oil case –  payments due to the security holder have been unclaimed by, and no written communication received from, the rightful holder, for a period of three years.  N.Y. ABP § 501(2)(a).  Only after the security has been found to be abandoned is it to be delivered to the state.  N.Y. ABP § 502.  Therefore, for purposes of the sale of Planet Express, it would seem that the 51 percent shares owned by That Guy would be in limbo for a three year period, while eligible heirs were searched for (likely in vain).  During this time, as they could not be voted, the minority shareholders would have been able to defeat the merger of their own accord.

IV. Escheat of a Majority Stake, and the Public Policy of the Future

Unfortunately, even THIS is not the end of the matter, because if escheat is exercised in this case, it would effectively transfer a majority interest in a private corporation to the state of New New York, as That Guy controlled 51 percent of Planet Express’s stock.  While seizure and nationalization of private businesses by the federal government is not unheard of, seizure is usually predicated on great turmoil, such as a World War – though even war is not always sufficient cause for nationalization, see Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952), which held that President Truman’s attempted nationalization of the steel industry during the Korean War, by executive order, was authorized neither by the Constitution, nor by Congress, and was thus illegal – but no such circumstance is present here.  There is precedent of the nationalization of a private business due to severe financial hardship (most recently General Motors), and it is undisputed that there were severe hardships facing Planet Express; however, it would be very difficult to argue (despite the many dealings the company has had with the President of Earth), that Planet Express was such a vital cog in the economy as compared with GM.

For fairly obvious reasons – it is rare for any individual to die both intestate and without any heirs to take under intestacy, and it is borderline inconceivable that an individual who is intellectually capable of obtaining majority control of a company would also die intestate – there is no precedent for a state obtaining a majority share of a company via escheat.  As such, any analysis here will be speculative.  However, I believe that the guidance of the Supreme Court in Youngstown Sheet & Tube, and Standard Oil v. New Jersey, allows us a fairly clear indication as to the public policy rationale that might guide a New New York court in rendering a decision in this matter.  Youngstown provides that nationalization (or, in a more general sense, public takeover of a private business) can occur only when expressly provided for, either by the Constitution or under the law, and Standard Oil allows for corporate stock to be taken by the state under escheat, but provides only for the delivery of the securities, and for the payment of moneys due the holder of the securities.  Similarly, Article 5 of the ABP appears more concerned with obtaining payments due under the securities than with voting rights, and in fact no mention is made in the law of the state’s exercise of voting rights.  Moreover, much like the federal government under Youngstown, it would appear that a state can only take control of a private company under specific conditions provided for under the law, such as a state banking regulator taking control of a struggling bank.  Therefore, I believe that New New York would be able to take possession of That Guy’s 51 percent stake in Planet Express under escheat, but only for purposes of taking any dividends due (or, in the event the sale did go through, its share of the proceeds from the sale).  However, as no law expressly allows the exercise of voting control on securities taken under escheat, an attempt to do so would be illegal.

V. Conclusion

While “Future Stock” does not address the option of minority shareholders to enjoin a majority action, the episode does address the reasonableness standard fairly well.  When the minority shareholders realize how much their shares have appreciated due to the impending sale, each of them (except Fry) immediately voice happiness over their being overruled, thus acting “reasonably” and defeating any notion of an oppression suit.  The episode handles the issue of That Guy’s estate (namely his 51 percent stake in Planet Express) less well.  The episode ignores both the securities and estates law on point, instead assuming that control of the shares would pass from chairman to vice-chairman.  Even if the shares were repurchased by Planet Express, regardless of how the corporation chose to treat them, they would not be voting shares unless and until they were re-issued by the corporation.  And if they passed into That Guy’s estate … as discussed at length above, that opens up a considerable can of worms, to say the least.

That said, while this particular episode might not have handled the law exceptionally well, there are at least two instances from Futurama’s current run where the show has addressed novel legal implications of its futuristic setting, in a serious, thought-provoking manner.  And besides, Futurama is a spectacular show.  You should watch it.  The hypnotoad commands youAll glory to the hypnotoad.

Cerebro and Privacy Laws

The X-Men movies feature Professor X’s Cerebro device, which amplifies the power of telepathic mutants, allowing them to find other mutants anywhere in the world.  In X-Men: First Class, Professor X and Magneto collaborate with the US government to assemble a team of mutants.  Although the movie is set in the early 1960s, Cerebro (nowadays called Cerebra) is also used in stories set in the modern day.  What’s more, it’s used to collect information on mutants around the world.  This caught the attention of Law and the Multiverse reader Mathias Ullrich, who wrote a great guest post on the subject using First Class as an example:

A data-protection consideration of Prof. Xavier’s recruiting methods according to German law

When reading the article about the responsibility of Prof. Xavier as the principal of a full time school some weeks ago, I started wondering about Prof. Xavier’s way of recruiting. As a data protection officer in Germany, my attention turns to data protection concerns.

As I’m not so familiar with the X-Men, I’ll stick to the movie X-Men: First Class. To analyze the whole process, I divide it into the different relevant steps:

1) data acquisition by telepathy

2) merging the data with another database (e.g. the CIA database) in order to get real addresses

3) offering specific services

4) deletion / blocking of the personal data

Some basics about the German data protection law: The German implementation of the European Data Protection Directive (“Directive 95/46/EC”) is one of the strictest implementations in Europe and is probably the strictest data protection law in the world. It’s called the “Bundesdatenschutzgesetz” or BDSG in short. In general it says that data processing of personal data is forbidden, unless there is an authorization of it in either the BDSG or other laws. So every data acquisition and processing needs an authorization.

Is German law applicable?

The first question we need to answer is if German law applies, when somebody in the world is acquiring customer data. The answer is quite simple: if there is an acquisition of personal data from German citizens, then German law can be used. This is similar to the discussions regarding Google Analytics or Facebook.

What kind of organization are the X-Men?

As stated in a recent blog post, Xavier’s School is a private school.

Step 1: the acquisition

When Professor Xavier searches for mutants, he is gathering data about the health status and some other information about potential students. Health status is one of the so-called “special kinds” or sensitive kinds of personal data according to §3 Abs. 9 BDSG, alongside racial and ethnic origin, political or religious belief and some more.

Acquiring and processing these kinds of personal data has some special rules. As said before, the German data protection law forbids unauthorized data processing, so we need to find permission.

From the reaction of the mutants visited by Magneto and Professor X, I assume none of them gave permission for acquiring the data. So I would also say that Professor X did not inform the people concerned about the concrete use of the data. This is mandatory. It is illegal to acquire data without the knowledge of the person concerned (§33 Abs. 1 BDSG).

Let’s go back to the acquisition. In §28 Abs. 6f and 9 BDSG we find the exceptions.

It’s possible to acquire these data without an explicit permission, if

– it is vital to the person concerned and he / she is not able to give the permission (§28 Abs 6, Nr. 1 BDSG)

– the data is has been made public by the person concerned (§28 Abs 6, Nr. 2 BDSG)

– the data is necessary for a legal transaction (§28 Abs 6, Nr. 3 BDSG)

– the data is necessary for medical research, if this research cannot be done without (§28 Abs 6, Nr. 4 BDSG)

– the data is necessary for medical care, if the acquisition is made by a doctor or somebody else with an obligationtoconfidentiality (§28 Abs 7 BDSG)

– the acquisition is made by a political, philosophic or religious organization without financial interest, but only for their members or associated people.

I do not think any of these exceptions apply. That means that the acquisition of the health status of the possible new students is illegal according to German law.

Step 2: the merging

After acquiring the data, I assume Professor X needs to get information about the new students, he wants to visit. Therefore, he merges the data with some database, according to the movie, it might be a CIA database. Here we have the exact same circumstance as in step 1. With just one exception more.

§28 Abs. 8 BDSG says, that the proceeding or transmitting sensitive data is allowed, if it is needed for defense of public safety.

Of course, thinking about maniacs who try to take over the world, the merging sounds legit, but the merging did not fight a concrete danger. It is more a “long term” investment. Unfortunately the acquisition of the data is still illegal and where did the CIA get data about European citizens? But that is another question, which will not be answered here ;-)

So, the merging might be legal, because of the exception for defense of public safety.

Quick note: §28 Abs. 8 BDSG only allows the processing or transmitting of data, not its acquisition.

Step 3: the offering

The last step is the personal visit to the possible new student in order to offer a personal service, in this case a place in Professor X’s private school.

As this is just again data processing, the same legislation applies as in step 2. So, maybe it’s legal because of the defense exception, but that need be discussed.

Step 4: blocking and / or deletion of data?

 In German data protection law, no data should be stored forever. As soon as the purpose of the data has expired, the data needs to be deleted (§35 Abs. 2 BDSG) or at least blocked.

When looking at the reaction by Wolverine, visited by Magneto and Professor X, one can assume that the purpose is expired, as Wolverine seems not to be interested in the offer. As we know, since Wolverine joins the X-Men later, the data may be blocked and not deleted.

Let’s check the terms for blocking instead of deleting, which are stated in §35 Abs 3 BDSG. Blocking data is allowed,

– if there are any laws or other legal issues that prohibit the deletion

– if it can be assumed that a deletion would affect the interests of the person concerned

– if the deletion is not possible or only possible with high effort because of the special way of storing the data

Again I do not think any of the exceptions apply. The data must be deleted, not blocked, at least as far as we are talking about a real database (e.g. the CIA one). If Professor X keeps the information in his mind, this is not affected by German data protection law.

Conclusion

Of course, there are a lot of unanswered questions, which make a final analysis quite difficult. Is telepathy acquisition of personal data and does German law apply here at all? Where is the data stored and how?

Besides that, the conclusion is quite simple. The acquisition was not legal, so every step beyond the first one, such as the uses the data from step 1, was illegal as well. According to §43, Abs. 2 Nr. 1 this is an administrative offense, with a penalty of up to 300,000 Euro in each case.

Translation guide

 Using §1 BDSG as an example:

– ‘§’ or Paragraf means paragraph in English, in this context it is translated to ‘section’.

– ‘Abs.’ is the abbreviation for ‘Absatz’. In this context it is ‘subsection’. In the example an ‘Absatz’ is marked by the brackets.

– The next one is Nr. (‘Nummer’), which means number. It is the next subsection, and in the example it is marked by the normal ‘1.’

– ‘Satz’ means sentence, if referring to a concrete sentence of the text, one uses ‘Satz’.