Electronic Communications

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The European Commission has released proposals for new legislation that seeks to create stronger privacy in electronic communications. The draft Privacy and Electronic Communications Regulation (the “Regulation”) is intended to replace the ePrivacy Directive (2002/58/EC) and will also bring the law in line with the new rules as set out in the General Data Protection Regulation (the “GDPR”) as part of the process to modernize the data protection framework in the EU. As a regulation (rather than a directive) it will apply uniformly across the EU as there will be one single set of rules which will crease more legal certainty, save for certain prescribed areas where EU Member States can have their own rules.

The CJEU (the European Union Court of Justice) has handed down a decision which makes clear that general and indiscriminate retention of electronic communications is unlawful. National legislation of each European Member State should ensure that mass surveillance only occurs where it is strictly necessary in order to combat serious crime as well as terrorism and meets other stringent requirements.

The references were made by the Swedish and UK courts and concerned the interpretation of the Privacy and Electronic Communications Directive (Directive 2002/58/EC, as amended by Directive 2009/136/EC) (the “Directive”), in light of the rights granted by the Charter of Fundamental Rights of the European Union (the “Charter”), particularly, the right to privacy (Article 7) and the right to protection of personal data (Article 8), and the decision of the CJEU in Digital Rights Ireland (C‑293/12 and C‑594/12).

The dream of hack-proof communication just got a little closer to reality. On August 16, 2016, China launched the world’s first “quantum satellite,” a project the Chinese government hopes will enable it to build a communication system incapable of being hacked. Such a system, if perfected, would allow for encrypted communications between any two devices with absolute certainty that the encryption could not be broken, and with a built-in mechanism for alerting the sender/receiver if someone tried.

Two states – New Jersey and Connecticut – have recently imposed additional legal conditions on electronic messaging to mobile devices. In a few ways, these laws may raise the bar for companies on compliance when sending text messages and possibly other forms of messaging to mobile devices.

On October 27, 2015, New Jersey Governor Chris Christie signed into law A-617, a bill prohibiting sending text message advertisements to New Jersey residents without the recipient’s prior permission, if the recipient could incur a charge or a usage allocation deduction for receiving the message. Prior permission must be express authorization from the intended recipient specifying the number to which the message may be sent, and may be revoked at any time.  Violators may be penalized by a civil penalty imposed by the New Jersey Attorney General of up to $500 for the first offense and $1,000 each time after. The law also requires telecommunications companies to allow customers to block all incoming and outgoing text messages that result in charges or usage allocation deductions.  The New Jersey law will become effective November 2016.

Connecticut has joined a list of twenty-one states with a statute designed to preserve the privacy of personal online accounts of employees and limit the use of information related to such accounts in employment decision-making. Legislation directed to online privacy of employees has also passed this year in Montana, Virginia, and Oregon, and such legislation is pending in a number of other states.

In the largest ever data security enforcement action taken by the Federal Communications Commission (FCC), AT&T agreed to pay $25 million to resolve an investigation into consumer privacy violations at its call centers in Mexico, Colombia, and the Philippines. The FCC announced the settlement on April 8, 2015, stating that phone companies are expected to “zealously guard” their customers’ personal information and encouraging the industry to “look to this agreement as guidance.”

Traditionally, a person’s most valuable assets to be distributed upon death consisted of tangible items such as real property, cash, jewelry and personal effects of sentimental value like photographs and letters.  However, the advent of the digital age has brought a shift from file cabinets, mailmen and photo albums to cloud storage, e-mail accounts and online photo streams.  Today, virtually everyone has at least some assets that are not physical, but are stored as data and accessed via the Internet.  “Digital assets” may include, for example, text messages, instant messaging accounts, e-mails, documents, audio or video images and sounds, social media content, health insurance records, source code, software, databases, online bank accounts, blogs, and the user names and passwords necessary to access online accounts, among other things.  More specifically, consider a person’s PayPal or Venmo accounts, which might contain large sums of money, or Google, Yahoo, Facebook or Instagram accounts, which might contain letters, pictures, videos and other items of intrinsic value.  The steady growth of most individuals’ online presence has given rise to a novel legal issue – authority over administering the digital assets and accounts of an account holder upon death or disability.