ICAAN, the Internet Corporation for Assigned Names and Numbers, has provided “keys” to the internet to seven members of the global community. As discussed in prior posts, ICAAN is a non-profit watchdog group that helped establish Domain Name System Security Extensions,  or DNSSEC.   The DNSSEC—which just became enabled this year— is a critical security technology that lies at the core of the internet’s global addressing system.  It protects the very heart of the internet by ensuring that users reach the intended web address.

According to the BBC, the system tasks seven individuals with safeguarding high tech cryptographic keys, each encoded with a portion of a DNSSEC root key.   In the event of a global cyber attack, a minimum of five of the seven key holders are to converge at a secure location in the U.S., then use their keys to combine into a single root key which will ‘restart the world wide web.’  The seven key holders reside all over the world, one each from Britain, the U.S., Burkina Faso, Trinidad and Tobago, Canada, China and the Czech Republic. 

So, what happens if one of our super heroes is derailed by bad weather? ICAAN has apparently assigned some back-up cyber guardians just in case the requisite number of key holders cannot make it to their pre-determined location.  Not exactly like Superman, but these days we have to be practical.

The DNSSEC itself was recently implemented as a joint effort between ICANN and VeriSign, Inc., which manages two of the world’s 13 internet root servers, with support from the U.S. Department of Commerce, to improve security of the internet’s naming infrastructure.

These developments should come as welcome news to issuers of cyber insurance policies. As the threat of cyber terrorism and cyber extortion becomes a growing source of exposure for companies and governmental institutions, underwriters will want to be aware of the  added sources of security being developed by these organizations and the options available to their policyholders.

An example of data mining can be seen in the advertisements that pop up on the side of your Facebook home page.  Such ads are often relevant to the information posted on your “Profile” page, such as advertisements promoting products from your college alma mater. 

At the outset, data mining seems like a win-win situation for both the consumer and the seller—the consumer is marketed with a product in which they are seemingly interested and the company has utilized its advertising budget in an informed, cost-effective manner.  At the same time, however, the threat of an invasion of privacy is real and has the attention of members of Congress and federal officials to create legislation regulating the way in which, and the extent to which, our personal information is shared with third parties. 

According to The Buffalo News, Facebook, Twitter, and Google have come under attack due to their alleged failure to safeguard and secure users’ personal data from interested third parties.  John A. Curr III, executive director of the Western regional chapter of the New York Civil Liberties Union, stated that “‘[t]he largest, most-profitable unregulated industry in America is data and data mining.’”  Although the threat of invasion of privacy exists, the public continues to share a significant amount of personal information on these cyber sites.  Phone numbers, addresses, relatives, photos, and birthdates are just a few examples of the information that is shared on these sites.  From this information, more personal information can be discovered than what you have authorized to share. For example, scientists from Carnegie Mellon University accurately predicted the full, nine-digit Social Security numbers for 8.5% of people born in the United States between 1988 and 2003.  If this information gets into the wrong hands, identity theft may become a reality for individuals carelessly sharing such information. 

Not only is identity theft a concern, but posting information may negatively affect the credit offered to you and the credit you receive.  The internet news blog reports that seemingly mindless chatter in the open forum, such as “status updates” on Facebook, may get the attention of lenders, who may use this information in determining who to offer credit cards with lower rates.  The article warns to be truthful when openly sharing information, and counsels not to reveal financial woes in the public forum, even when jokingly doing so. 

The threat of invasion of privacy is not a new issue for underwriters.  The question of whether insurance coverage is available for “personal and advertising injury” under a standard commercial general liability policy has been addressed in litigation involving (1) the Telephone Consumer Protection Act (“TCPA”), where class actions sought damages against companies which sent unsolicited facsimiles, and (2) the Fair and Accurate Credit Transactions Act (“FACTA”), which imposes heavy penalties on companies that do not truncate consumers’ credit card numbers when finalizing a purchase.  If Congress determines that legislation is needed to regulate sites such as Facebook, Twitter, and Google, and imposes penalties for invasions of privacy such as those available under TCPA and FACTA, underwriters should consider whether and to what extent their insurance policies should (or should not) provide coverage for invasion of privacy in the cyber sphere.

We’ve received reports from a number of Cyberinquirer Members lamenting that they do not receive the Cyberinquirer feeds and do not know when a new article is posted. If you’d like to receive these notifications, you need to sign up in the “Subscribe” box to the right of this post. Joining as a Member, while laudatory, isn’t enough if you want the feeds.

As to those of you who read our blog but haven’t signed up as a Member, well, what are you waiting for? Please join us and feel free to publish constructive substantive comments in the Members’ Forum or with respect to a particular posting. Or, even better, submit your own cyber articles for publication. The more people who get involved, the better for all of us. This is a community blog, not just Pamela’s and mine. Let’s make good use of it! To those of you who already participate, thank you kindly and cheers.

Rick

At least two employers did. News surfaced last week that Eric Mangini, head coach of the NFL’s Cleveland Browns, has threatened to fine players for tweeting about events at training camp, and particularly during team meetings. This on the heels of the well-publicized action taken last year by the NBA’s Milwaukee Bucks. In that case, Bucks forward Charlie Villanueva apparently posted a message to his Twitter feed from his cell phone when he went into the locker room at halftime of a basketball game against the Boston Celtics. According to reports, the tweet that was posted from Villanueva’s “CV31” screen name read: “In da locker room, snuck to post my twitt. We’re playing the Celtics, tie ball game at da half. Coach wants more toughness. I gotta step up.”

The good news is that Villanueva apparently stepped up, scoring a team-high 19 points to help the Bucks beat the Boston Celtics that afternoon. As for the Browns, well, we’ll see. However, like many employment law issues, the concern is not for the period in which everyone is winning; rather, the key is to address a potential problem before the bad times attendant to a losing streak risk damage to the entire team.

Twitter continues to dominate the popular culture, allowing users to post microblogs from a cell phone at the pace of an instant message, and has become a popular site for celebrities in the sports and entertainment world who have a following of gaggle that hang on to the tweeter’s every move and thought. Twitter’s growth can be attributable to the ease in posting and reading the messages, as well as the fact that such posting and reading can be done anywhere one may be standing with a cell phone.

And therein lies the problem. The implications of an NFL or NBA star’s use of Twitter apply equally to your employees. Your company might not be a sports franchise, and your office may not consist of a locker room. However, your company should consider the implications of social networking sites like Twitter on your workplace and your employees.

Employer Take Away – What should every employer take away from this development? One could chalk up these stories to simply more examples of young athletes being immature. Or, they can serve to demonstrate, by extension, the realities of today’s technology and the expanding universe of modes of communication that, while increasing our ability to connect with others around the world, increase the risks right there in the four walls of your company’s office.

(1) Recognize the effect that increased social networking has on employee productivity. Even Milwaukee Bucks’ head coach recognized the productivity dilemma, when he commented at the time that “…anything that gives the impression that we’re not serious and focused at all times is not the correct way we want to go about our business.” While employers try to keep to the old adage that a “happy employee is a productive employee,” there should be limits to acceptable forms of happiness when they come at the expense of productivity because your employee is spending countless hours posting tweets when he should be performing his or her job duties. While it is clearly more difficult to monitor an employee’s use of twitter on a personal cell phone that is not synchronized with the company’s systems, you should at the very least create a policy that prohibits excessive use of personal, social networking sites while on company time. With regard to the use of social networking sites more generally, particularly those that are used from the company’s computers, you should be mindful of the applicable laws that govern an employer’s monitoring of employee activity. Employers can, however, limit exposure under these laws, and in fact eliminate any reasonable expectation of privacy on the part of the employee, if employees are required to sign appropriately-worded documents acknowledging and consenting to the company’s monitoring policies.

(2) Be mindful of the lack of control your company has over the use of sites such as Twitter. In the good old days, one only had to worry about the informal musings of an employee on the rapid-fire system we once knew as “e-mail”. Now, there is an increased potential for workplace harassment that comes with the even great informality of Twitter. There is a real concern over the fact that twitter posts from a personal cell phone may not be part of the company’s systems, and thus the company may not have the same ability to control or capture and save messages in the same way it can with e-mail, or even with instant messages that are delivered through the company’s computer system. Employers must nevertheless be sure that their harassment policies address the potential issues that arise in the context of inappropriate harassment and discrimination through the use of social networking sites, and be equally vigilant when responding to a complaint arising from communications made on those sites.

(3) Prevent employees from intentionally or inadvertently disclosing confidential or proprietary information due to the informal nature of communications on sites such as Twitter. Again, it is critical for your company to make sure it has policies in place regarding the use and disclosure of company information, and that those policies specifically address the concerns attendant to these new social networking sites.

(4) Consider restrictions. The trend toward making it easier for employees to engage in communications quicker and from anywhere in the world, increases the possibility that such employees claim to be “working” 24/7 while engaging in those communications. For example, even if your company does not authorize a non-exempt employee to work overtime, an employee must still be paid for hours worked (although a company certainly can discipline an employee for performing unauthorized overtime). Without the proper policies in place, and without the appropriate measures taken to ensure that the company can control and stay on top of the number of hours worked by all non-exempt employees, the potential for exposure exists under federal and state wage payment laws.

The case of Finkel v. Dauber (New York Supreme Court, Nassau County) centered on statements posted by a Facebook group known as “90 Cents Short of a Dollar.” Plaintiff alleged that she was defamed by the group’s postings that stated “unbeknownst to many, [plaintiff] acquired AIDS while on a cruise to Africa” and then “persisted to screw a baboon which caused the epidemic to spread.”   The postings further defamed plaintiff, she alleged, by stating “[w]hile in Africa she was seen fucking a horse.”   And other intelligent banter.

 The court first acknowledged that even posts on a social networking site can be subject to the elements of a legal claim for defamation. Thus, an aggrieved individual must identify, among other things, a false “statement of fact” that was published without authorization by the subject of the statement. However, the court in Finkel noted that “’rhetorical hyperbole’ or ‘vigorous epithet’ will not suffice.” In determining whether liability lies, “context is key” and one must weigh the “broader social context or setting surrounding the communication[.]”   Under that backdrop, the court in Finkel ultimately dismissed plaintiff’s defamation claim, stating:

“A reasonable reader, given the overall context of the posts, simply would not believe that the plaintiff contracted AIDS by having sex with a horse or a baboon or that she contracted AIDS from a male prostitute who also gave her crabs and syphilis, or that having contracted sexually transmitted diseases in such a manner she morphed into the devil.   Taken together, the statements can only be read as puerile attempts by adolescents to outdo each other. While the posts display an utter lack of taste and propriety, they do not constitute statements of fact.”

Yes, this may be an extreme case. And the ultimate result of Finkel is obviously a good one for the party defending the claim of liability. But do you want to take the chance in the next case by not being proactive in today’s social media world?    Even though plaintiff here did not prevail, I think the message is clear.  

Employer Take Away – What should every employer take away from this development?

(1)       Informality is not a defense. Although context will be one factor to consider, the fact that statements are made or conduct occurs on a more informal social networking site or blog does not insulate the statements or conduct from potential liability. Employers must make sure that their written policies and employee training emphasize that informality can breed an increased risk of liability for the company, and that traditional legal theories (and employment prohibitions) apply equally to web-based statements and conduct.

(2)        Ease is not a defense either.   The ease with which employers and employees alike may converse, obtain information, and share private experiences does not mean that “old rules” do not still apply. It is still discrimination to take action because of one’s pregnancy or one’s participation in a gay and lesbian organization, even if the employer only learned that information from reading a profile page. Just as it still may be sexual harassment if the offending chatter took place on a Facebook “wall-to-wall”.   Employment policies and practices must consider whether employment-related decisions should be based, in whole or in part, on information obtained through social media sites in the first place, and, if so, which company officials should be involved in the information gathering and decision making processes.

On July 23, 2010, the United States Court of Appeals for the Eighth Circuit issued an important decision in Eyeblaster, Inc. v. Federal Ins. Co., 2010, U.S. App. LEXIS 15152, No. Civ. A. 08-3640, finding concurrent coverage under both a General Liability (“CGL”) insurance policy and a separate Information and Network Technology Errors and Omissions Liability (“E&O”) policy in circumstances where an online marketing company installed software on a consumer’s computer system, allegedly corrupting the computer’s software operating system.

Eyeblaster Inc. (“Eyeblaster”), the policyholder, is a company that creates, delivers and manages online interactive advertising. For the period December 5, 2006, to December 5, 2007, it was insured under two concurrent policies issued by Federal Insurance Company (“Federal”): (1) a CGL policy covering occurrences which cause damage to tangible property, and (2) an E&O policy which covered claims for financial loss caused by a wrongful act in connection with a product’s failure to perform its intended function or serve its intended purpose, resulting in damage to intangible property. As to the latter policy, intangible property included software, data and other electronic information. Both policies were “duty to defend” forms.

In the underlying tort action, David Sefton (“Sefton”) sued Eyeblaster for allegedly “enticing” him to “visit” an internet website which, he claimed, Eyeblaster fraudulently led him to believe was connected with America Online.  According to Sefton’s complaints, this “visit” resulted in the download onto his computer of spyware, tracking cookies, executable code, java script and other alleged rogue programs.  These programs allegedly hijacked Sefton’s computer and caused changes to his computer’s security settings, renamed his computer’s system files, redirected his web browser, and installed pop-up advertisements.  He further alleged that the introduction of spyware caused his computer to freeze up, resulting in lost data for a tax return and forcing him to retain a computer technician.  Sefton also claimed that Eyeblaster’s software allowed commercial surveillance that could result in cyber-stalking, identification of confidential web visitations and personally identifiable information, and invasion of privacy and solitude.

Based on the foregoing, Sefton sued Eyeblaster in Texas, alleging violations of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030, the Texas Business and Commercial Code, deceptive trade practices and prima facie tort under Texas law, trespass, conversion, fraud, nuisance, invasion of privacy, intrusion upon seclusion, and conspiracy.  Specifically, Sefton alleged that (1) Eyeblaster  intentionally accessed a protected computer without authorization, (2) the deceptive trade practice violations were committed knowingly, and (3) Eyeblaster intended to deceive him and intended that he rely on its misrepresentations.

Eyeblaster tendered the claim to Federal under both the CGL and E&O policies.  Federal denied coverage under both policies based on the positions that there was: (1) no “property damage” caused by an accident or occurrence, as required by the CGL policy, i.e., no “physical injury to tangible property, including resulting loss of use of that property . . . ; or loss of use of tangible property that is not physically injured” (the definition of “tangible property” excluded “any software, data or other information that is in electronic form”), and (2) no “wrongful act” within the meaning of the E&O policy, i.e., no “error, unintentional omission or negligent act,” as, in Federal’s view, Eyeblaster intended to place its software on Sefton’s computer.

In light of Federal’s coverage declination, Eyeblaster sued Federal in the United States Court for the District of Minnesota, seeking a declaration that Federal owed it both a duty to defend and a duty to indemnify.

Following discovery, the parties filed cross-motions for summary judgment.  The court granted Federal’s motion and denied Eyeblaster’s, finding: (1) no coverage under the CGL policy because there was no damage to tangible property, insofar as Sefton’s complaints alleged only damage to his computer’s software, not its hardware, and (2) no coverage under the E&O policy because Eyeblaster acted intentionally in creating software which it intended to be downloaded to Sefton’s computer.  According to the court, the fact that Eyeblaster may not have intended the resulting injury to Sefton’s software was not dispositive. Hence, it determined that Federal had no duty to defend or indemnify.

Eyeblaster appealed the trial court’s decision, arguing that the court was wrong as to coverage under both the CGL and the E&O policies.  The Eighth Circuit agreed with Eyeblaster, reversing the District Court on both scores.

With respect to the CGL policy, the court noted that “property damage” was defined to include “loss of use of tangible property that is not physically injured.”  In this respect, the Eighth Circuit found that Sefton’s underlying complaints alleged that “his computer was ‘taken over and could not operate,’ ‘froze up,’ and would ‘stop running or operate so slowly that it will in essence become inoperable.’”  The court further quoted Sefton’s complaints to allege that he “experienced ‘a hijacked browser – a browser program that communicates with websites other than those directed by the operator,’ and ‘slowed computer performance, sometimes resulting in crashes.’”  Sefton further asserted that “his computer ha[d] three years of client tax returns that he cannot transfer because he believes the spyware files would also be transferred, and he therefore must reconstruct those records on a new computer.”  According to the court, “[h]e thus argues that his computer is no longer usable, as he claims among his losses ‘the cost of his existing computer.’”

In so stating, the court observed that the term “tangible property” was not defined in Eyeblaster’s CGL policy except to exclude “software, data or other information that is in electronic form.”  Under the court’s construct, “[t]he plain meaning of tangible property includes computers, and the Sefton complaint alleges repeatedly the ‘loss of use’ of his computer.”  As such, the court concluded “that the allegations are within the scope of the General Liability policy,” citing America Online, Inc. v. St. Paul Mercury Ins. Co., 207 F. Supp. 2d 459, 470 (E.D. Va. 2002) (district court found loss of use of tangible property when complaint alleged that AOL caused loss of use of computers and computer functionality, but concluded no coverage existed because allegations were otherwise excluded), aff’d, 347 F.3d 89 (4th Cir. 2003), and State Auto Prop. & Cas. Ins. Co. v. Midwest Computers & More, 147 F. Supp. 2d 1113, 1116 (W.D. Okla. 2001) (in a case with “property damage” language identical to that of the Eyeblaster policy, the court held that “[b]ecause a computer clearly is tangible property, an alleged loss of use of computers constitutes ‘property damage’ within the meaning of plaintiff’s policy”); but see, America Online, Inc.  v. St. Paul Mercury Ins. Co., 347 F.3d 89 (4th Cir. 2003), (court rejected policyholder’s argument that insofar as its software package “altered the customers’ existing software, disrupted their network connections, caused them loss of stored data, and caused their operating systems to crash,” there was property damage under a CGL policy covering liability for “physical damage to tangible property;” the court identified the configuration instructions, data, and information as intangible and abstract).

At the same time, the court found that the underlying allegations were not excluded by the CGL policy’s impaired property/property not physically injured exclusion, because there was no evidence that Sefton’s computer system could be restored to use by removing Eyeblaster’s software.  The court found it equally unclear from the record as to whether Eyeblaster’s software could be removed from his computer.  Finally, the court summarily rejected Federal’s assertions that the Eyeblaster CGL policy’s “expected or intended” and “intellectual property laws or rights” exclusions applied.  As such, it determined that Federal, at a minimum, owed Eyeblaster a duty to defend with respect to Sefton’s underlying lawsuit.

Moving on to Eyeblaster’s E&O policy, the court held that Federal had a concurrent duty to defend under that form.  After first acknowledging Federal’s concession that there was “financial injury”, the court evaluated whether Eyeblaster committed a “wrongful act,” defined in the policy as, “an error, an unintentional omission, or a negligent act.”  The court noted that in its prior decision in  St. Paul Fire & Marine Ins. Co. v. Compaq Computer Corp., 539 F.3d 809, 815 (8th Cir. 2008), it “defined ‘error’ in a technology errors and omissions policy to include intentional, non-negligent acts but to exclude intentionally wrongful conduct.”  Applying this principle to the facts before it, the court found that Sefton’s complaints alleged that “Eyeblaster installed tracking cookies, Flash technology, and JavaScript on his computer, all of which are intentional acts. However, Federal can point to no evidence that doing so is intentionally wrongful. As Eyeblaster points out in an affidavit filed with the district court, Federal’s parent company utilizes JavaScript, Flash technology, and cookies on its own website. Federal cannot label such conduct as intentionally wrongful merely because it is included in the Sefton complaint; Federal has a duty to show that the use of such technology is outside its policy’s coverage. Federal points to no evidence that the allegations concerning tracking cookies, etc. spoke of intentional acts that were either negligent or wrongful. Under St. Paul, therefore, the Sefton complaint does allege a wrongful act.”  As such, the court concluded that Federal similarly had a duty to defend the Sefton litigation under Eyeblaster’s E&O policy.

While there are contrary decisions as to the existence of “property damage” under a CGL policy in the context of third-party cyber claims, Eyeblaster demonstrates the importance of a well-crafted insurance policy, particularly in our evolving technological age.  It is axiomatic that courts are protective of policyholders, many reaching to find coverage where none was intended to exist or was never contemplated.  Needless to say, it is incumbent on insurers to continually review and refine their CGL, E&O and other policy wordings to ensure that they clearly and unambiguously cover only those claims and losses for which coverage is intended, and preclude coverage for those matters for which it is not, whether by way of a policy’s insuring agreement, exclusions, conditions or otherwise.  At a minimum, CGL underwriters should review and, as appropriate, refine their policies’ definitions of “property damage” and exclusions.  In turn, E&O underwriters must carefully define “wrongful act” as it relates to intended and unintended acts and results, and pay close attention to their policies’ exclusions to ensure that the coverage limitations are properly articulated.  At the same time, it has become increasingly important for underwriters and claims professionals to closely monitor and stay on top of developing case law trends and state and federal legislation in order to: (1) understand the ways in which new technologies may implicate coverage, and (2) prudently craft their wordings and policies to provide coverage only for those risks for which premiums have been paid.

A special thank you to Stephanie Gantman, Esquire of Cozen O’Connor for her indispensible assistance with this post. Thanks Stephanie!

Interviewing for your first job as a teenager is as exciting as it is intimidating. Thoughts of what to do with your first paycheck consume your mind as you rehearse your best “do-you-want-fries-with-that” smile. The interview proceeds flawlessly and you start to count the dollar signs as you await the job offer. But imagine your surprise when you are informed that you did not get the job because your background check revealed that you are over $75,000 in debt and five years behind in your child support payments for your eleven year old child…a terrifying thought considering you are only 16 years old.

Adults aren’t the only victims of identity theft. Child identity theft is an increasing and understated crime. A child’s Social Security Number (“SSN”) is the perfect target, as the theft typically goes undetected until years after the crime has taken place. Indeed, the crime might not be discovered until the rightful owner/victim uses his or her SSN for the first time years later. This revelation often occurs when the victim applies for his or her first job or financial aid before college.

The scheme works as follows: businesses are using various techniques to search the Internet for dormant SSNs. These numbers often belong to long-term inmates, dead people or children. Obtaining them is not as difficult as one may think, as SSNs are distributed systematically depending on age, geographical location and when the number is issued. Once it has been determined that no one is actively using the number to obtain credit, the numbers are offered for sale.

For example, dormant numbers are being sold to fraudsters who want to establish phony credit. Although some of the purchasers may be seeking a new number in hopes of rebuilding his or her financial position, most buyers use the numbers to run up large amounts of debt that they never intend to repay. Once the number is no longer useful (i.e. the credit is destroyed), a new number is purchased and the cycle continues. Given the plethora of dormant numbers, one can change his or her identity almost as easily as Angelina Jolie can adopt children.

Of course, selling SSNs is illegal; however, these businesses are not selling SSNs. Rather, they are selling a “CPN,” which stands for “credit profile number,” “credit protection number” or “credit privacy number.” Complex disclaimers warning against using CPNs in place of SSNs make it difficult to prove that the businesses are actually selling SSNs. Such activities are even more difficult to prosecute. To make matters worse, since these crimes often remain undetected for years, the businesses selling these numbers often no longer exist by the time the crime is discovered.

In an effort to protect minors’ identities and credit issuers’ portfolios, the Identify Theft Resource Center proposed the creation of a Minors 17-10 Database. The Database would maintain a registry of all SSNs issued to minors younger than 17 years and 10 months and would provide credit issuers with a method to verify whether the CPN belonged to a minor. Regrettably, the proposed database has not yet been adopted or implemented.

A host of credit reporting agencies provide tools to protect against this type of fraud; however, they can be prohibitively expensive, particularly for small business owners. Until a system similar to the Minors 17-10 Database can be put into place, businesses are encouraged to confirm and cross reference as much of the applicant’s information as possible.

The best way to protect yourself or your child from this crime is to routinely check your child’s credit report for any activity. Also, if your child is receiving pre-approved credit card applications in the mail or telephone calls from telemarketers, such contacts provide indicia that your child’s identity might be at risk. The earlier this crime is detected, the easier it is to remedy.

As for professional liability underwriters who insure or are looking to write small businesses and other credit providers, it is important to know that your policyholders are using all resources available to protect themselves and avoid losses, whether they be cyber-related or through brick and mortar operations. As President Obama recently observed, the private and public sectors need to work cooperatively to protect the nation’s financial and cyber infrastructures. A key player in this effort is the insurance industry. Insurers need to be at the forefront and proactive. The risks simply are too great for them not to be.

Richard Bortnick also contributed to this post.

While that’s obviously good news, the follow-up question is “how are we doing in meeting the associated demands?” Regrettably, not so well, it seems.

Speaking before cybersecurity and privacy experts from government, law enforcement, the private sector, academia and privacy and civil liberties groups, President Obama, Homeland Security Secretary Janet Napolitano, Commerce Secretary Gary Locke, Cyber Coordinator Howard Schmidt and other Administration officials uniformly acknowledged that far more work needs to be done to protect digital communications and information infrastructure and make it more difficult and costly for cybercrimimals.

According to the government’s progress report, published following the President’s address, one of the first steps to be taken is the implementation of a cybersecurity incident response plan, colloquially referred to as the National Cyber Incident Response Plan, which is in its final draft form and will be tested in September. The Plan is designed to ensure a coordinated national response in the event of a “significant cyber incident.”  At or about the same time, the Department of Homeland Security will introduce a cybersecurity program to raise public and private awareness. 

Beyond these efforts, the government recently released its National Strategy for Trusted Identities in Cyberspace, a proposed Internet identity authentication plan intended to improve online privacy and security.

The government’s progress report further notes that the Administration is working with other like-minded nations to build a framework for international cybersecurity policy as part of the United Nations Group of Governmental Experts on cybersecurity.  In this regard, cybersecurity diplomats and specialists representing 15 countries recently published a report presenting recommendations to the U.N. Secretary General for negotiations on an international computer security treaty.  The U.N report recommends five steps to improve cybercooperation and security, including improved communications and enhanced exchanges of ideas and information. Most promising, the signatories include Russia, China, Great Britain, France, Germany, Italy, India, and Israel.

Beyond governmental initiatives, the Administration has urged public and private industry to collaborate on solutions to protect the nation’s technology infrastructure. A key component of the government’s agenda is to facilitate the creation of a robust cybersecurity insurance market designed to motivate public and private industry to improve their own cybersecurity.  At present, there is no time frame or outline for this proposal. Still, the government’s public acknowledgement that the insurance industry needs to become a leader in finding solutions is a clear signal that far more needs to be done on that front as well.

In short, cybersecurity is a key element of the Obama Administration’s agenda. Insurance executives, underwriters, brokers and policyholders alike should seize the initiative and invest themselves in finding solutions. The incentives are obvious. The need is clear. The time is now.

“A lawyer is never entirely comfortable with a friendly divorce, anymore than a good mortician wants to finish his job and then have the patient sit up on the table.”  Jean Kerr

A new company out of Dallas, DivorceApps.com, is selling applications aimed at helping people navigate the legal waters of divorce. A Texas family lawyer, Michelle May O’Neil, started the company in March of this year. Two apps currently are for sale on iphones at a cost of $9.99 USD.  Applications that are currently available online are described as follows:

(1) Cost and Prep Application: A system that 1) tracks the information that will be required either by legal counsel or the other side of the case and 2) helps the user track the costs of divorce. For example, the “Divorce Cost” portion of the application provides a scroll down list of categories that enables the user to gain a better understanding of the costs of divorce. The “Scroll Down” component of the application allows the user to scroll through the categories of information to determine the documents and information that will be applicable to their case.

(2) Estate Divider Application: The “Estate Divider” is a system that purports to allow a user to work through the overall division of their Estate. The user can:

• Input the values for the Estate’s various assets and liabilities;
• Assign specific assets and liabilities to “Spouse A” or “Spouse B” (such as a house or car) or allocate asset value between “Spouse A” and “Spouse B” (such as a bank account);
• Input an overall desired division of the estate between “Spouse A” and “Spouse B”;
• Calculate the amount of money needed to accomplish the split entered in 2) and express the amount of money needed to accomplish the split in terms of (i) a cash payment from the spouse with the higher initial allocation or (ii) alimony, or (iii) a mix of both;
• If any of the equalizing payment is allocated to alimony, determine the post-tax equivalent of the alimony to be received by payee and the post tax cost of the alimony to be paid by payor;
• Calculate any overall tax advantage to payor and payee by structuring part or all of the equalizing payment as alimony; and
• The application allows the user to email to themselves, their attorney, and/or their financial advisor: their desired settlement and the outcome of the property division.

Other applications in development include a child possession calendar, which will illustrate the dates and times that  person will have custody of their children under a possession order, and will communicate with the ex-spouse about switching dates and times. A child support calculator will calculate the amount of money that the user will pay or the ex-spouse will pay for the support of the children.

A good idea or a bad idea? Based on the descriptions above, it doesn’t appear that the applications are designed to replace family lawyers, but rather to assist individuals in understanding the process. To our knowledge, divorce apps haven’t yet been developed for Canada, but that’s likely to change soon. These apps give new meaning to the term “real world application”.

Indeed, just this month, government officials announced that they have shut down nine websites as part of their newly announced initiative, “Operation In Our Sites,” which is intended to protect Hollywood’s intellectual property. Officials estimated that nearly 7 million pirated movies and shows per month were downloaded from the offending websites.

The announcement was held on a soundstage at The Walt Disney Studios in Burbank, CA. Neither Johnny Depp nor Captain Hook reportedly was present.

Flanked by Disney executives and representatives of two of Hollywood’s largest unions, government officials explained that hundreds of thousands of the 2.5 million jobs in the entertainment industry are lost when consumers illegally download content. Rather than targeting individual websites, however, the government is going after a “class of violators engaged in criminal theft of American movies and shows.” It’s clear that the government is serious, as the initiative combines the resources of U.S. Customs and Border Protection, the FBI, the Food and Drug Administration, the Department of Commerce, and the GSA’s Office of Inspector General.  “This will be a sustained effort,” according to ICE Assistant Secretary John Morton, “[w]e’ll be at this week after week after week.” And the targets are not just the webmasters; they’re also the downloaders. Regardless of their age.

ICE projects that the U.S. economy has lost more than $58 billion dollars and 353,000 jobs as the result of I.P. piracy.  Hence, all kidding aside, it does look like a serious problem.

The joint agency efforts follows an iniative by the Obama administration creating a Task Force and joint strategic plan intended to enforce I.P protections.  In April, the government announced the creation of fifteen new federal prosecutor jobs and 20 new FBI special agent positions dedicated to I.P. crime investigation and enforcement.

So, the next time your child or you thinks about illegally downloading the new hot Hollywood film or television show, you’d better think twice. Big Brother could be watching. And he won’t be viewing the same program you are.

,