Introducing the Internet of Torts

Rebecca Crootof 

Once upon a time, missing a payment on your leased car would be the first of a multi-step negotiation between you and a car dealership, bounded by contract law and consumer protection rules, mediated and ultimately enforced by the government. You 46038488 - law concept: circuit board with  scales icon, 3d rendermight have to pay a late fee, or negotiate a loan deferment, but usually a company would not repossess your car until after two or even three consecutive skipped payments. Today, however, car companies are using starter interrupt devices to remotely “boot” cars just days after a payment is missed. This digital repossession creates an obvious risk of injury when an otherwise operational car doesn’t start: as noted in a New York Times article, there have been reports of parents unable to take children to the emergency room, individuals marooned in dangerous neighborhoods, and cars that were disabled while idling in intersections.

This is but one of many examples of how the proliferating Internet of Things (IoT) enables companies to engage in practices that foreseeably cause consumer property damage and physical injury. But how is tort law relevant, given that these actions are authorized by terms of service and other contracts? In this post I’ll elaborate on how IoT devices empower companies at the expense of consumers and how extant law shields industry from liability. In a future post, Accountability for the Internet of Torts, I’ll discuss what we can learn from prior tort law revolutions about how the law might evolve to hold these companies accountable. Overarchingly, a political economy perspective highlights how technological developments like the development of the IoT are not neutral—they enable new conduct, new relationships, and new kinds of harm that disproportionately affect the poor—and how law can be used either to preserve or correct resulting power imbalances.

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Worker Surveillance and Class Power

Brishen Rogers 

Companies around the world are dreaming up a new generation of technologies designed to monitor their workers—from Amazon’s new employee wristbands, to Uber’s recording whether its drivers are holding their phones rather than mounting them, to “Worksmart,” a new productivity tool that takes photos of workers every ten minutes via their webcams. Technologies like these can erode workplace privacy and encourage 46038488 - law concept: circuit board with  scales icon, 3d renderdiscrimination. Without disregarding the importance of those effects, I want to focus in this post on how employers can use new monitoring technologies to drive down wages or otherwise disempower workers as a class. I’ll use examples from Uber, not because Uber is exceptional in this regard — it most certainly is not — but rather because it is exemplary.

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The Political Economy of Freedom of Speech in the Second Gilded Age.

Jack Balkin — 

We are now well into America’s Second Gilded Age. The First Gilded Age was the era of industrial capitalism that begins in the 1870s and 1880s and continued through the first years of the 20th century, ultimately giving way to the reforms of the Progressive Era. The First Gilded Age produced huge fortunes, political corruption and vast inequalities of wealth, so much so that people became concerned that they would endanger American democracy.

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The Second Gilded Age begins, more or less, with the beginning of the digital revolution in the mid-1980s, but it really takes off in the early years of the Internet Age in the mid to late 1990s, and it continues to the present day characterized by the rise of social media, and the development and implementation of algorithms, artificial intelligence, and robotics. For this reason I call our present era the Algorithmic Society.

If the First Gilded Age is the age of industrial capitalism, the Second Gilded Age is the age of digital or informational capitalism. It too has produced great fortunes and led to concerns that increasing concentrations of wealth and economic inequality are endangering American democracy.  Like the First Gilded Age, it is also a time of deep political corruption and despair about the future of American democracy. It has not yet produced a second Progressive Era, yet every day I see signs that this is where we are headed.

There is a large literature criticizing the judicial doctrines of the First Amendment, and how they are slanted toward the interests of corporations (and capital generally) in the Second Gilded Age. The most obvious examples are the federal courts’ recent decisions on commercial speech and campaign finance regulation. These are interesting and important topics, but they are not the subject of this blog post.

My focus here is on the political economy of free speech in the digital age.  The basic question is this: How does our political and economic system pay for a digital public sphere? It pays for it largely through digital surveillance and through finding ever new ways to make money out of personal data.  Digital capitalism in the Second Gilded Age features an implicit bargain: a seemingly unbounded freedom to speak in exchange for the right to surveil, govern,  and manipulate end-users.

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Rule-Making as Structural Violence: From a Taxi to Uber Economy in San Francisco

Veena Dubal 

Between 2012 and 2014, California regulators made critical decisions that ultimately restructured political economies of mobility around the world. In municipal and then state regulatory bodies, policy-makers refused to enforce existing taxi laws and regulations against so-called “ridesharing” services, including industry leader UberX, as well as Lyft, and Sidecar. Regulators determined that the companies were not taxis but “transportation network companies” (“TNCs”), and created new rules to govern them. These California rules were the first of their kind anywhere in the world. The regulations and logics that they engendered were subsequently replicated nationally and internationally. The global regulatory response devastated worker livelihoods and transformed what had been a low-paid full time job to even lower-paid part time gigs.

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How did workers make sense of rapid change in their industry? What were their reactions when regulators refused to enforce existing taxi rules and to the rulemaking that ultimately devastated their livelihoods? And what can their narratives, experiences, and understandings tell us about the political economy of law amidst innovation?

Taxi workers in my ethnographic research challenged two fundamental aspects of the prevailing popular and academic narratives of “uberization” as a neoliberal political and economic re-ordering. First, workers argued that this legal transition and the social and political norms it propagated were embedded neither in technology nor in techno-utopian imaginaries. Instead, in making sense of their own precarity, taxi workers placed blame on the structural power of private actors and the instrumental power of regulators. Second, in telling the tale of how law and power worked together to facilitate the demise of their tenuously secure work, drivers were emphatic that this was not a story of deregulation or state withdrawal. Contrary to some traditional academic accounts, taxi workers argued that both the rule-making process and the rules themselves created and valorized a market in which the state had a strong, active, and even authoritarian hand.

Now a global phenomenon, Uber began as UberCab in San Francisco in 2010. Less than two years later, Lyft and Sidecar launched a different model: non-professional private drivers using their own cars and a suggested, non-mandatory price for the ride. Uber adopted this new model as UberX but with a mandatory fee set by the company. Shortly thereafter, the United Taxicab Workers—a twenty-five year old, worker-led taxi driver advocacy organization—alerted city officials to the growing number of unlicensed taxis competing for their work and roving the streets of San Francisco. They lobbied the city to enforce taxi regulations against the companies.

Mark, a UTW leader and long-time taxi driver, was frustrated at the city’s inaction. He told me in late 2012,

These are worse than illegal limos. They don’t even have licenses! People are using their own cars. Non-professional drivers. They are running afoul of every taxi regulation. They claim they’re innovative and new, but we already have this technology! This is what Cabulous [a taxi app] is. We’ve been using this for the past few years. This isn’t about technology. This is just a new exploitative business model—one step removed from the leasing model that the taxi companies have been using for years. They’re just bandit cabs. We’ve been pushing the MTA to issue another cease and desist but they won’t. They won’t enforce their own regulations. (my italics)

Mark argued that the Uber business model was not about technological innovation—but about the innovation of capital. He, like many other taxi drivers, emphasized that the technology itself pre-existed Uber. He understood Uber as an exploitative evolution from the precarious leasing model introduced in the San Francisco taxi industry in the late 1970s. Unlike taxi drivers who had to pay taxi companies for the lease and gas before they could venture out onto the road, Uber drivers also had to bear the costs of their vehicle maintenance and hybrid liability insurance (which did not exist until 2016). To make matters worse, the companies were operating without vehicle caps or fare regulations—the two key regulations that taxi workers had long used to maintain some semblance of wage stability.

Ruach—who, like Mark, had been driving in San Francisco since the late 1970s—argued that Uber’s innovation was to centralize dispatch, which UTW advocates had been pushing for years.

The media keeps selling this as innovative technology. This is not innovative or about technology. We have been trying to get the Board of Supervisors to pass an ordinance to mandate centralized dispatch for years. They won’t do it. The dispatch companies and the cab companies push back. And now, all of a sudden, these tech companies come in and everyone’s excited about centralized dispatch. HELLO! Have you been listening [to us] all these years? That’s all these companies are. (my italics)

When I asked worker advocates why they thought the city was unwilling to use their regulatory powers to stop these companies, especially since the SFMTA had just commodified and sold 900 medallions two years earlier, they blamed it on the structural power of capital.   Barry, another driver and advocate, described Uber’s massive lobbying efforts as “graft.” Although in most cases, the lobbying was technically not illegal, he understood it to be steeped in anti-democratic, corrupt practices. In a conversation we shared in 2013, he explained,

Ron Conway was an early funder of Mayor Ed Lee, and he is also an investor in Lyft and Uber. There are rumors [former] Mayor Willie Brown is getting his pockets lined as well. This is just graft. They are using the language of the tech economy. But they know that’s not what this is about. These are just taxi companies but with Wall Street money. Infinite amounts of money. We thought they [the taxi companies] were corrupt. (my italics)

In 2013, a rule-making process that began in late 2012, the California Public Utility Commission decided two critical things. As a matter of law, Uber offered pre-arranged rides and therefore, under the California Constitution, was to be regulated not by (more progressive) municipalities but exclusively by the state. And second, in the explicit name of “innovation,” the agency was to create a new regulatory category—Transportation Network Companies—and regulate them differently than limos and taxis—without car licenses, vehicle caps, or fare regulation.

Drivers like Mark, Ruach, and Barry directly related the structural power of venture capital to this regulatory outcome. They often felt their advocacy was misunderstood; they did not oppose technology. In fact, they laid claim to the technology themselves. But they protested the specific role of law, and in Barry’s words, the “greed and graft” through which those laws were achieved, in compelling the demise of their industry and livelihoods. They acknowledged that by producing two regulatory regimes, officials had eased the burden on TNCs at their expense. But they framed the character of the state as heavy-handed, not as laissez faire. This was not government facilitating a “free market” through deregulation, but preventing competition by maintaining fares at below market rates, and creating an overall unequal playing field.

Today, workers’ wages across the Uber-taxi divide are roughly 65% of what they were in 2010. They are often below the minimum wage. Told through the eyes of workers, the case study of how regulators responded to rule-breaking platforms and created the city’s contemporary Uber economy can neither be explained through innovation fanaticism nor fundamentally through a politics of efficiency and deregulation. Taxi workers understood innovation discourse as obscuring both their everyday hardships and corruptive, though legal, state practices. And they reframed the law in this process as playing an active role in undermining democratic principles, producing the myth of a free market, and exacerbating political and economic inequalities. As Mark wrote to me in a text following the fifth recent suicide of a taxi driver, “The invisible hand has shown its hand.”

Veena Dubal is Associate Professor of Law at U.C. Hastings College of the Law, San Francisco. 

Visit our Political Economy of Technology page to read all the posts in this series.

Data Nationalization in the Shadow of Social Credit Systems

Frank Pasquale –

The political economy of digitization is a fraught topic. Scholars and policymakers have disputed the relative merits of centralization and decentralization. Do we want to encourage massive firms to become even bigger, so they can accelerate AI via increasingly comprehensive data collection, analysis, and use? Or do we want to trust-bust the digital economy, encouraging competitors to develop algorithms that can “learn” more from less data? I recently wrote on this tension, exploring the pro’s and con’s of each approach.46038488 - law concept: circuit board with  scales icon, 3d render

However, there are some ways out of the dilemma. Imagine if we could require large firms to license data to potential competitors in both the public and private sectors. That may sound like a privacy nightmare. But anonymization could allay some of these concerns, as it has in the health care context. Moreover, the first areas opened up to such mandated sharing may not even be personal data. Sharing the world’s best mapping data beyond the Googleplex could unleash innovation in logistics, real estate, and transport. Some activists have pushed to characterize Google’s trove of digitized books as an essential facility, which it would be required to license at fair, reasonable, and non-discriminatory (FRAND) rates to other firms aspiring to categorize, sell, and learn from books. Fair use doctrine could provide another approach here, as Amanda Levendowski argues.

In a recent issue of Logic, Ben Tarnoff has gone beyond the essential facilities argument to make a case for nationalization. Tarnoff believes that nationalized data banks would allow companies (and nonprofits) to “continue to extract and refine data—under democratically determined rules—but with the crucial distinction that they are doing so on our behalf, and for our benefit.” He analogizes such data to natural resources, like minerals and oil. Just as the Norwegian sovereign wealth fund and Alaska Permanent Fund socialize the benefits of oil and gas, public ownership and provision of data could promote more equitable sharing of the plenitude that digitization ought to enable.

Many scholars have interrogated the data/oil comparison. They usually focus on the externalities of oil use, such as air and water pollution and climate change. There are also downsides to data’s concentration and subsequent dissemination. Democratic control will not guarantee privacy protections. Even when directly personally identifiable information is removed from databases, anonymization can sometimes be reversed. Both governments and corporations will be tempted to engage in “modulation”—what Cohen describes as a pervasive form of influence on the beliefs and behaviors of citizens. Such modulation is designed to “produce a particular kind of subject[:] tractable, predictable citizen-consumers whose preferred modes of self-determination play out along predictable and profit-generating trajectories.” Tarnoff acknowledges this dark possibility, and I’d like to dig a bit deeper to explore how it could be mitigated.

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Artificial Sovereigns: A Quasi-Constitutional Moment for Tech?

K. Sabeel Rahman –

Consider the following developments:

  • In recent weeks, the explosive revelations about Cambridge Analytica and its systemic data-mining of Facebook profiles has cast into relief the way in which our contemporary digitized public sphere is not a neutral system of communication but rather a privately built and operated system of mass surveillance and content manipulation.46038488 - law concept: circuit board with  scales icon, 3d render
  • Meanwhile, Alphabet has announced that its subsidiary, Sidewalk Labs, will take over management of a major redevelopment of part of Toronto’s waterfront, in an effort to build from the ground up a modern “smart city.”
  • These developments come amidst the longer-term development of new forms of technological transformations of our political economy, from the rise of Amazon to its position as the modern infrastructure for the retail economy, to the ways in which technology is transforming the nature of work and the social safety net.

There has been a growing sense of concern about the twin crises of twenty-first-century democracy on the one hand and of the growing problems of inequality and insecurity on the other. Technological change is at the heart of both of these transformations. Technological change alters the distribution and dynamics of political and economic power, creating new forms of “functional sovereignty”—state-like powers concentrated in entities and systems that are not subject to the institutional and moral checks and balances that we associate with the exercise of public power. Such arbitrary power represents a kind of quasi-sovereignty that, left unchecked, poses a threat of domination.

The rich scholarly debate on law and technology has surfaced a range of approaches for addressing some of these concerns, from legal standards for privacy and data use to antitrust and public utility regulation, and more. These proposals and interventions can be reframed as part of a broader challenge of defusing the threat of domination created by these technological systems. Regulating and responding to new technologies and modern forms of economic and political power thus represent a variation on familiar questions of public law and constitutional design: how to structure the exercise of potentially arbitrary, state-like power, rendering it contestable, and therefore legitimate.

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Police Surveillance Machines: A Short History

Elizabeth Joh –

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The year 2015 witnessed a dramatic rise in demands for police surveillance machines. After a number of widely shared incidents of police violence against often unarmed civilians, public protests and media attention led to calls for the adoption of surveillance machines by the police.  Advocates of surveillance machines, including the family of Michael Brown, argued that these technologies would increase transparency and accountability surrounding police interactions with civilians by collecting and preserving data for public review.  Indeed, the most contentious police-civilian interactions often came down to public disputes as to the alleged threat posed by the civilian, versus the propriety of the police response. Surveillance machines promised a technological layer of accountability by rendering these hidden interactions public. Now that they are being implemented, however, the political economy of police technologies raises new concerns about concentrated private power, consumer platform protection, and adequate regulation of data in the future of policing.

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Technology, Political Economy, and the Role(s) of Law

Julie E. Cohen –

Legal scholars who work on information policy tend to focus on questions about how existing doctrinal and regulatory frameworks should apply to information-era business models and online behavior, perhaps undergoing some changes in coverage or emphasis along the way. They have asked, in other words, how law should respond to the changes occurring all around it. For the most part, they have not asked the broader, reflexive questions about how core legal institutions are already evolving in response to the ongoing transformation in our political economy—questions about how disputes over scalesanddata.jpginformation are reshaping the enterprise of law at the institutional level. That is a mistake. Information-economy actors do not simply act in markets; they also mobilize legal tools and institutions to advance their various goals. Through that process, legal institutions gradually become reoptimized for the new roles they are called upon to play.

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Law and the Political Economy of Technology

Amy Kapczynski –

In April, Jack Balkin, Yochai Benkler and I convened a workshop on the law and political economy of technology at Yale Law School. Participants drafted thought papers, which we spent the better part of two days discussing.  In the coming weeks, many participants will post revised papers or reflections in a series of posts that will be featured on these pages and cross-posted at Balkinization. scalesanddata.jpg

In convening the conference, we aimed to bring a political economy lens to a domain of extraordinary importance to our lives today.  Robots, gig-economy platforms, surveillance capitalism, and global networks all have helped shape rising inequality and the increasing precarity of work.  Bots and social media generate new challenges for democratic societies purportedly based on fair elections and a reasoned public sphere.  New surveillance technologies are being embraced by the criminal justice system, the military, and intelligence communities, with little attention to the racialized implications of these new extensions of the carceral state.

In analyzing problems such as these, we began from a shared understanding that technology doesn’t operate outside of a social or legal context.  Technology has a political economy, deeply shaped by law.  Politics orders technology through many different decisions made in code and in law.  These include decisions about the scope and ownership of intellectual property, about the permissible degree of concentration in industries, and about who will be allowed to access the outputs and inputs of technology. Law, together with social norms, shapes the diffusion and adoption of technology—for example, through labor and employment regulations, tax and transfer policies, and securities laws. How does law interact with technology to increase control by some and decrease the freedom of others? How does it in so doing exacerbate inequality?  And how might law make social practices mediated by technology more democratic and egalitarian? Over the course of this series, we will investigate how politics and law interact with technology to influence political and economic organization, mobilization and political communication, and patterns of inequality and economic insecurity.

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