While none of the presidential debates in the country looked good, the Supreme Court has just delivered its most important ruling yet for the tech industry. By overturning a 40-year-old decision, the court has opened up regulators to endless interference by industry and the whims of judges who are compromised and out of touch.
The Supreme Court announced Friday morning that it had ruled 6-3 (you know who voted how) to dismiss Chevron v. Natural Resources Defense Council, a 1984 case that established a very important principle in federal regulation.
Federal law is necessarily broad, since it applies to many jurisdictions. Moreover, some laws remain on the books for decades without amendment. And so the words of every law — like the Constitution — require interpretation, a task spread across all parties in the legal system, from lawyers to judges. Amici curé,
The 1984 Chevron decision established that independent agencies such as the EPA, SEC, and FCC also have a say. In fact, the decision found that in cases where the law is ambiguous, courts should treat these agencies as experts in their field.
For example, think of something like the Clean Water Act that provides some legal protection for wetlands. Who defines whether a piece of land counts as a wetland or not? It can’t be interested parties like heavy industry or nature advocacy groups, because their interpretations would be mutually exclusive. And what is the likelihood that any judge who is assigned the case has any expertise in the matter? Instead, in such cases, the EPA, which is equipped with hypothetically disinterested experts on wetlands, has the authority to settle ambiguities.
OK, so what do wetlands and the EPA have to do with technology? Well, who do you think defines “encryption”, or “communications”, “search and seizure”, or “reasonable expectation of privacy” in the law?
The whole concept of net neutrality On top of the FCC’s interpretation of whether broadband data is an “information service” or a “communications service,” the terms written in the act empower that agency.
If the FCC doesn’t have the authority to resolve this ambiguity in a very old law written long before today’s broadband and mobile networks, who does? Whichever court hears the case brought by the telecom industry hates net neutrality and would prefer an interpretation in which the FCC doesn’t regulate them at all. And if the industry doesn’t like the court’s interpretation, it gets a few more chances as the case moves forward — oh, the Supreme Court.
Interestingly, Justice Elena Kagan remarked (As quoted by court reporter Amy Howe), that “in one stroke” the Court had given itself “exclusive authority over every open issue — no matter how expertise-driven or policy-driven — including the meaning of regulatory law.” In other words, the Supreme Court assigned to himself Powers currently exercised by each regulatory agency in the country.
The game of technology pays off with time
Why is this so important to technology? Because the tech industry Facing a wave of regulatory activity These agencies are led by the government, operating in the absence of congressional action. Due to the lack of effective federal laws in technology, agencies have had to step in and offer updated interpretations of the laws already on the books.
technology leaders There have been repeated and vigorous calls for federal legislation Not agency regulation — but defining and limiting their industries. “Please,” they scream, “give us a federal privacy law! Pass a law on location data! Pass a nice big law about how artificial intelligence should be used!”
They know very well that Congress is almost incapable of passing any such laws, partly because tech industry lobbyists quietly oppose them in the background whenever any laws are proposed. You might be surprised to know that despite tech demanding these laws for a decade or more, little or no laws have actually come to fruition! And when California passed a billThey all lament: it’s not like that HeThis request is for presentation only.
Let’s be optimistic for once and imagine that Congress passes a major law on AI, protecting certain information, requiring certain disclosures, and so on. It is unlikely that such a law would contain no ambiguities or purposeful vagueness, allowing the law to apply to as yet unknown situations or applications. Thanks to the Supreme Court, those ambiguities will no longer be resolved by experts.
(To wit, in today’s decision Justice Gorsuch repeatedly referred to nitrogen oxide, a pollutant, as nitrous oxide, the laughing gas. That’s the level of expertise we can expect.)
Ambiguities exist in every law. And ambiguities are even more common on the technology front, because there is no precedent and lawmakers do not understand technical matters.
And so, looking ahead, who defines “artificial intelligence”, or “scrape” or “personal information”, or “invasive”? Yesterday, it could have been the FCC or FTC, with their experts in technology, industry, markets, etc., making an informed decision and perhaps even seeking public opinion, as they often do in rulemaking processes. Today, it will be a judge in whatever state the industry decides has the friendliest or most gullible bench.
As Kagan argued, resummarized by Howe,
Kagan gave the example of a hypothetical bill to regulate artificial intelligence. Congress, she said, “knows there are going to be gaps in it because Congress can barely see a week into the future.” So it would want people who “actually know about AI and are accountable to the political process to make decisions about artificial intelligence.” Courts, she stressed, “don’t even know what the questions are about AI,” much less the answers.
This decision is arguably the biggest single anti-regulation action that could be taken, and as we have all seen, without regulation, tech — like any other big industry — will consolidate and exploit. The next few years, even under a pro-regulatory Democratic administration, will be a free-for-all. There is no barrier, and perhaps even no harm, for industry lawyers to challenge every single regulatory decision in court and argue for a more favorable interpretation of the law.
We are entering a favorable environment for large companies that used to face regulatory scrutiny – they are now much less likely to be penalized for bad behavior, as they can redefine what is “bad” by the jurisdiction of their choice.
But chaos favours the nimble, and big tech companies have proven themselves slow to react when faced with industry-upsetting technology such as AI (or so they believe). Here, put bluntly, is an opportunity for those with money and ambition, but free of certain ethical principles, to explore new methods and business models that might previously have attracted regulatory attention.
If you think you’ve been exploited before – you ain’t seen nothing yet.
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