Claudalie Faces Anti-Competition Probes, Pro Music Rights’ Lawsuit Against Apple Dismissed, Case Filed against Cambridge Analytica, Data breach exposes 1.9 million Pixlr user records, More than 22 billion records exposed in data breaches in 2020, Google asks to move antitrust lawsuit to California, Trump pardons Google Engineer who stole trade secrets, Amazon Opposes EU’s Permit for Separate Antitrust Sales Probe, Parler’s Demand for Reinstatement on Amazon Denied, SoftBank’s Sale of NVIDIA Raises Antitrust and National Security Concerns and Tesla Sues Employee for Allegedly Stealing Trade Secrets.
Claudalie Faces Anti-Competition Probes
French skincare brand Caudalie is at the heart of a probe by the Belgian Competition Authority (BCA). A Belgian store owner filed a complaint that his supplier had enforced a strict pricing policy on the subsequent sale of Caudalie’s products. BCA states that the minimum resale price requirement that the company has imposed on its distributors is in violation of the Code of Economic Law, and Treaty on the Functioning of the European Union (TFEU), which bars agreements that aim to “restrict, prevent or distort competition.”
This is not the first time that Caudalie has found itself under the scrutiny of competition authorities. In 2013, eNova, the operator of online platform 1001pharmacies.com had claimed that Caudalie’s selective distribution agreements, which prohibited its products from being sold on third-party platforms, such as eNova or Amazon, violated EU competition law, which prohibits such bans unless they can be objectively justified.
The Paris Court of Appeals had actually held the ban on selective distribution agreements to be valid. The court reiterated that luxury brands may restrict the sale of their goods on third-party online platforms by way of selective distribution systems in order to preserve the quality of their products.
Pro Music Rights’ Lawsuit Against Apple Dismissed
In March, 2020, Pro Music Rights (PMR), had filled a case alleging collusion against Apple, along with Spotify, SoundCloud, Amazon, and many others. The claim was that the defendants had entered into an illegal agreement to shut PMR out of the market and to fix prices at infra-competitive levels. But by October 2020, PMR had settled with Napster, iHeartMedia and Connoisseur Media. A district court judge has dismissed the suit and the reasons seem to be unclear.
PMR had previously instituted a USD 1 billion complaint against Spotify. It was alleged that Spotify had removed tracks “for anti-competitive reasons” and failed to pay royalties for a 550 million streams. Spotify had sternly refused the allegation and has recently entered negotiations to settle the matter outside court.
CBI files case against Cambridge Analytica
Central Bureau of Investigation (CBI) has filed a case against Cambridge Analytica and Global Science Research Ltd for “illegal harvesting of personal data from Facebook users”. Facebook had authorized Global Science Research’s app to collect specific datasets of its users for research and academic purposes.
CBI officials stated that their preliminary enquiry prima facie established that Global Science Research Ltd, UK dishonestly and fraudulently accessed data of app users of “this is your digital life” and their Facebook friends. The investigation was launched in 2018, after Facebook had claimed that the data of about 87 million Facebook users might have been misused Cambridge Analytica. This included five lakh Indian users whose accounts had also been compromised.
Data breach exposes 1.9 million Pixlr user records
Hacker ShinyHunters, has leaked 1.9 million Pixlr user records in the dark web. These contain email addresses, login names, SHA-512 hashed passwords, a user’s country and other sensitive information that can be used to carry out targeted phishing and credential-stuffing attacks. The hacker claimed they stole the database during their November breach of 123rf, where they stole 8.3 million user records which included phone numbers, addresses, PayPal emails, and IP addresses. These breaches inform a trend where cyber criminals are actively targeting organizations to monetize data.
More than 22 billion records exposed in Data breaches in 2020
A report from Tenable’s Security Response Team (SRT) pointed that over 22 billion records were exposed worldwide amid 730 publicly disclosed data breaches in 2020. Thirty five percent of breaches were attributed to ransomware attacks and 14 per cent of breaches were the result of email compromises. One of the overarching themes was that bad actors relied on unpatched vulnerabilities alongside chaining together multiple vulnerabilities as part of their attacks. From 2015 to 2020, there has been an increase of 36.6 per cent in the number of reported common vulnerabilities and exposures (CVEs). Web browsers like Google Chrome, Mozilla Firefox, Internet Explorer and Microsoft Edge are the primary target for zero-day vulnerabilities.
Google asks to move antitrust Lawsuit to California
Texas and nine other states have filed a suit against Google in Texas, accusing the company of working with Facebook Inc in a way that violated antitrust law. Google has requested the case to be moved to California on the grounds that the state has relevant witnesses and documents needed. Google has also pointed out that the states’ lawsuit “does not identify a single company or person who might be a witness at trial and lives or works within 100 miles” of Texas.
Google has been sued three times since October 2020 by U.S. states and the Justice Department. In December a separate group of 38 U.S. states and territories have filed their own antitrust complaint against Google.
Trump pardons Google Engineer who stole trade secrets
President Donald Trump pardoned a former Google engineer, Anthony Levandowski, who stole trade secrets related to robotic vehicles and started his own company, Otto. Otto was later acquired by Uber for USD 680 million. Levandowski had downloaded a trove of Google’s self-driving car technology, leading to 33 counts of intellectual property theft against him for which he was sentenced to 18 months in prison.
More than 140 people had been pardoned in a flood of clemency action by the former President in the last hours of his term.
Amazon Opposes EU’s Permit for Separate Antitrust Sales Probe
Amazon asked the European Union’s General Court to strike down part of a European Commission decision that allowed Italy to undertake a parallel investigation into issues of promotion by the eCommerce giant. The EU is investigating Amazon’s mechanisms of selection of retailers for its ‘buy box’ on pages that attract approximately 80% of sales. Amazon stated that the EU should not have authorized a similar Italian probe to continue alongside the EU as “(w)hen the European Commission decides to investigate a matter, European law says that national competition authorities cannot investigate the same topic.”
Parler’s Demand for Reinstatement on Amazon Denied
Judge Barbara Rothstein denied granting a preliminary injunction for Parler to be reinstated on Amazon Web Services. The judge pointed at the lack of evidence and the fact that Parler had not denied that its users posted violent, detailed threats on the platform before and around the January 6th attack on the US Capitol for reaching the judgement. Parler had been taken down from most major web infrastructure companies, including Apple and Google after the said attack. The social media site sued Amazon in retaliation.
SoftBank’s Sale of NVIDIA Raises Antitrust and National Security Concerns
SoftBank’s USD 40 billion deal to sell British chip designer company, Arm, to US chipmaker Nvidia is raising anti-trust and national security concerns among policymakers across the globe. The company requires approvals from regulators in the UK, China, the European Union and the US, which could take 18 months to complete.
Arm is the world’s leading supplier of semiconductor intellectual property and has licensed its technology to a broad array of semiconductor companies. Nividia competes directly with Arm customers as Qualcomm, Intel, Advanced Micro Devices, MediaTek and Samsung Electronics. The acquisition raises concerns that it would distort competition among downstream players that buy technology licenses from Arm.
Tesla sues employee for allegedly stealing Trade Secrets
Tesla has filed a trade-secret theft complaint alleging that, former employee Alex Khatilov stole more than 6,000 files of code, that automate a broad range of business functions. Tesla has claimed that the files found in Khatilov’s personal storage would enable engineers at other companies to reverse engineer Tesla’s processes. US District Judge Yvonne Gonzalez Rogers allowed a restraining order requiring Khatilov to immediately preserve and return all files, records and emails to the company.
The car maker has filed a number of lawsuits against other former employees and rival companies that it has accused of poaching engineers and stealing proprietary data.
Authored and compiled by Neharika Vhatkar (Associate, BananaIP Counsels) and Srinjayee Gupta (Legal Intern)
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