Further Reading, Other Developments, and Coming Events (15 December)

Further Reading

• “DHS, State and NIH join list of federal agencies — now five — hacked in major Russian cyberespionage campaign” By Ellen Nakashima and Craig Timberg — The Washington Post; “Scope of Russian Hack Becomes Clear: Multiple U.S. Agencies Were Hit” By David E. Sanger, Nicole Perlroth and Eric Schmitt — The New York Times; The list of United States (U.S.) government agencies breached by Sluzhba vneshney razvedki Rossiyskoy Federatsii (SVR), the Russian Federation’s Foreign Intelligence Service, has grown. Now the Department of Homeland Security, Defense, and State and the National Institutes of Health are reporting they have been breached. It is unclear if Fortune 500 companies in the U.S. and elsewhere and U.S. nuclear laboratories were also breached in this huge, sophisticated espionage exploit. It appears the Russians were selective and careful, and these hackers may have only accessed information held on U.S. government systems. And yet, the Trump Administration continues to issue equivocal statements neither denying nor acknowledging the hack, leaving the public to depend on quotes from anonymous officials. Perhaps admitting the Russians hacked U.S. government systems would throw light on Russian interference four years ago, and the President is loath to even contemplate that attack. In contrast, President Donald Trump has made all sorts of wild, untrue claims about vote totals being hacked despite no evidence supporting his assertions. It appears that the declaration of mission accomplished by some agencies of the Trump Administration over no Russian hacking of or interference with the 2020 election will be overshadowed by what may prove the most damaging hack of U.S. government systems ever.
• “Revealed: China suspected of spying on Americans via Caribbean phone networks” By Stephanie Kirchgaessner — The Guardian. This story depends on one source, so take it for what it is worth, but allegedly the People’s Republic of China (PRC) is using vulnerabilities in mobile communications networks to hack into the phones of Americans travelling in the Caribbean. If so, the PRC may be exploiting the same Signaling System 7 (SS7) weaknesses an Israeli firm, Circles, is using to sell access to phones, at least according to a report published recently by the University of Toronto’s Citizen Lab.
• “The Cartel Project | Revealed: The Israelis Making Millions Selling Cyberweapons to Latin America” By Amitai Ziv — Haaretz. Speaking of Israeli companies, the NSO Group among others are actively selling offensive cyber and surveillance capabilities to Central American nations often through practices that may be corrupt.
• “U.S. Schools Are Buying Phone-Hacking Tech That the FBI Uses to Investigate Terrorists” By Tom McKay and Dhruv Mehrotra — Gizmodo. Israeli firm Cellebrite and competitors are being used in school systems across the United States (U.S.) to access communications on students’ phones. The U.S. Supreme Court caselaw gives schools very wide discretion for searches, and the Fourth Amendment is largely null and void on school grounds.
• “‘It’s Hard to Prove’: Why Antitrust Suits Against Facebook Face Hurdles” By Mike Issac and Cecilia Kang — The New York Times. The development of antitrust law over the last few decades may have laid an uphill path for the Federal Trade Commission (FTC) and state attorneys general in securing a breakup of Facebook, something that has not happened on a large scale since the historic splintering of AT&T in the early 1980’s.
• “Exclusive: Israeli Surveillance Companies Are Siphoning Masses Of Location Data From Smartphone Apps” By Thomas Brewster — Forbes. Turns out Israeli firms are using a feature (or what many would call a bug) in the online advertising system that allows those looking to buy ads to get close to real-time location data from application developers looking to sell advertising space. By putting out a shingle as a Demand Side Platform, it is possible to access reaps of location data, and two Israeli companies are doing just that and offering the service of locating and tracking people using this quirk in online advertising. And this is not just companies in Israel. There is a company under scrutiny in the United States (U.S.) that may have used these practices and then provided location data to federal agencies.

Other Developments

• The Government Accountability Office (GAO) evaluated the United States’ (U.S.) Department of Defense’s electromagnetic spectrum (EMS) operations found that the DOD’s efforts to maintain EMS superiority over the Russian Federation and the People’s Republic of China (PRC). The GAO concluded:
  • Studies have shown that adversaries of the United States, such as China and Russia, are developing capabilities and strategies that could affect DOD superiority in the information environment, including the EMS. DOD has also reported that loss of EMS superiority could result in the department losing control of the battlefield, as its Electromagnetic Spectrum Operations (EMSO) supports many warfighting functions across all domains. DOD recognizes the importance of EMSO to military operations in actual conflicts and in operations short of open conflict that involve the broad information environment. However, gaps we identified in DOD’s ability to develop and implement EMS-related strategies have impeded progress in meeting DOD’s goals. By addressing gaps we found in five areas—(1) the processes and procedures to integrate EMSO throughout the department, (2) governance reforms to correct diffuse organization, (3) responsibility by an official with appropriate authority, (4) a strategy implementation plan, and (5) activities that monitor and assess the department’s progress in implementing the strategy—DOD can capitalize on progress that it has already made and better support ensuring EMS superiority.
  • The GAO recommended:
    • The Secretary of Defense should ensure that the Vice Chairman of the Joint Chiefs of Staff, as Senior Designated Official of the Electromagnetic Spectrum Operations Cross-Functional Team (CFT), identifies the procedures and processes necessary to provide for integrated defense-wide strategy, planning, and budgeting with respect to joint electromagnetic spectrum operations, as required by the FY19 NDAA. (Recommendation 1)
    • The Secretary of Defense should ensure that the Vice Chairman of the Joint Chiefs of Staff as Senior Designated Official of the CFT proposes EMS governance, management, organizational, and operational reforms to the Secretary. (Recommendation 2)
    • The Secretary of Defense should assign clear responsibility to a senior official with authority and resources necessary to compel action for the long-term implementation of the 2020 strategy in time to oversee the execution of the 2020 strategy implementation plan. (Recommendation 3)
    • The Secretary of Defense should ensure that the designated senior official for long-term strategy implementation issues an actionable implementation plan within 180 days following issuance of the 2020 strategy. (Recommendation 4)
    • The Secretary of Defense should ensure that the designated senior official for long-term strategy implementation creates oversight processes that would facilitate the department’s implementation of the 2020 strategy. (Recommendation 5)
• A forerunner to Apple’s App Store has sued the company, claiming it has monopolized applications on its operating system to the detriment of other parties and done the same with respect to its payment system. The company behind Cydia is arguing that it conceived of and created the first application store for the iPhone, offering a range of programs Apple did not. Cydia is claiming that once Apple understood how lucrative an app store would be, it blocked Cydia and established its own store, the exclusive means through which programs can be installed and used on the iOS. Furthermore, this has enabled Apple to levy 30% of all in-application purchases made, which is allegedly a $50 billion market annually. This is the second high-profile suit this year against Apple. Epic Games, the maker of the popular game, Fortnite, sued Apple earlier this year on many of the same grounds because the company started allowing users to buy directly from it for a 30% discount. Apple responded by removing the game from the App Store, which has blocked players from downloading updated versions. That litigation has just begun. In its complaint, Cydia asserts:
  • Historically, distribution of apps for a specific operating system (“OS”) occurred in a separate and robustly competitive market. Apple, however, began coercing users to utilize no other iOS app distribution service but the App Store, coupling it closer and closer to the iPhone itself in order to crowd out all competition. But Apple did not come up with this idea initially—it only saw the economic promise that iOS app distribution represented after others, like [Cydia], demonstrated that value with their own iOS app distribution products/services. Faced with this realization, Apple then decided to take that separate market (as well as the additional iOS app payment processing market described herein) for itself.
  • Cydia became hugely popular by offering a marketplace to find and obtain third party iOS applications that greatly expanded the capabilities of the stock iPhone, including games, productivity applications, and audio/visual applications such as a video recorder (whereas the original iPhone only allowed still cameraphotos). Apple subsequently took many of these early third party applications’ innovations, incorporating them into the iPhone directly or through apps.
  • But far worse than simply copying others’ innovations, Apple also recognized that it could reap enormous profits if it cornered this fledgling market for iOS app distribution, because that would give Apple complete power over iOS apps, regardless of the developer. Apple therefore initiated a campaign to eliminate competition for iOS app distribution altogether. That campaign has been successful and continues to this day. Apple did (and continues to do) so by, inter alia, tying the App Store app to iPhone purchases by preinstalling it on all iOS devices and then requiring it as the default method to obtain iOS apps, regardless of user preference for other alternatives; technologically locking down the iPhone to prevent App Store competitors like Cydia from even operating on the device; and imposing contractual terms on users that coerce and prevent them from using App Store competitors. Apple has also mandated that iOS app developers use it as their sole option for app payment processing (such as in-app purchases), thus preventing other competitors, such as Cydia, from offering the same service to those developers.
  • Through these and other anticompetitive acts, Apple has wrongfully acquired and maintained monopoly power in the market (or aftermarket) for iOS app distribution, and in the market (or aftermarket) for iOS app payment processing. Apple has frozen Cydia and all other competitors out of both markets, depriving them of the ability to compete with the App Store and to offer developers and consumers better prices, better service, and more choice. This anticompetitive conduct has unsurprisingly generated massive profits and unprecedented market capitalization for Apple, as well as incredible market power.
• California is asking to join antitrust suit against Google filed by the United States Department of Justice (DOJ) and eleven state attorneys general. This antitrust action centers on Google’s practices of making Google the default search engine on Android devices and paying browsers and other technology entities to make Google the default search engine. However, a number of states that had initially joined the joint state investigation of Google have opted not to join this action and will instead be continuing to investigate, signaling a much broader case than the one filed in the United States District Court for the District of Columbia. In any event, if the suit does proceed, and a change in Administration could result in a swift change in course, it may take years to be resolved. Of course, given the legion leaks from the DOJ and state attorneys general offices about the pressure U.S. Attorney General William Barr placed on staff and attorneys to bring a case before the election, there is criticism that rushing the case may result in a weaker, less comprehensive action that Google may ultimately fend off.
  • And, there is likely to be another lawsuit against Google filed by other state attorneys general. A number of attorneys general who had orginally joined the effort led by Texas Attorney General Ken Paxton in investigating Google released a statement at the time the DOJ suit was filed, indicating their investigation would continue, presaging a different, possibly broader lawsuit that might also address Google’s role in other markets. The attorneys general of New York, Colorado, Iowa, Nebraska, North Carolina, Tennessee, and Utah did not join the case that was filed but may soon file a related but parallel case. They stated:
    • Over the last year, both the U.S. DOJ and state attorneys general have conducted separate but parallel investigations into Google’s anticompetitive market behavior. We appreciate the strong bipartisan cooperation among the states and the good working relationship with the DOJ on these serious issues. This is a historic time for both federal and state antitrust authorities, as we work to protect competition and innovation in our technology markets. We plan to conclude parts of our investigation of Google in the coming weeks. If we decide to file a complaint, we would file a motion to consolidate our case with the DOJ’s. We would then litigate the consolidated case cooperatively, much as we did in the Microsoft case.
• France’s Commission nationale de l’informatique et des libertés (CNIL) handed down multi-million Euro fines on Google and Amazon for putting cookies on users’ devices. CNIL fined Google a total of €100 million and Amazon €35 million because its investigation of both entities determined “when a user visited [their] website, cookies were automatically placed on his or her computer, without any action required on his or her part…[and] [s]everal of these cookies were used for advertising purposes.”
  • CNIL explained the decision against Google:
    • [CNIL] noticed three breaches of Article 82 of the French Data Protection Act:
    • Deposit of cookies without obtaining the prior consent of the user
      • When a user visited the website google.fr, several cookies used for advertising purposes were automatically placed on his or her computer, without any action required on his or her part.
      • Since this type of cookies can only be placed after the user has expressed his or her consent, the restricted committee considered that the companies had not complied with the requirement provided for in Article 82 of the French Data Protection Act regarding the collection of prior consent before placing cookies that are not essential to the service.
    • Lack of information provided to the users of the search engine google.fr
      • When a user visited the page google.fr, an information banner displayed at the bottom of the page, with the following note “Privacy reminder from Google”, in front of which were two buttons: “Remind me later” and “Access now”.
      • This banner did not provide the user with any information regarding cookies that had however already been placed on his or her computer when arriving on the site. The information was also not provided when he or she clicked on the button “Access now”.
      • Therefore, the restricted committee considered that the information provided by the companies did not enable the users living in France either to be previously and clearly informed regarding the deposit of cookies on their computer or, therefore, to be informed of the purposes of these cookies and the available means enabling to refuse them.
    • Partial failure of the « opposition » mechanism
      • When a user deactivated the ad personalization on the Google search by using the available mechanism from the button “Access now”, one of the advertising cookies was still stored on his or her computer and kept reading information aimed at the server to which it is attached.
      • Therefore, the restricted committee considered that the “opposition” mechanism set up by the companies was partially defective, breaching Article 82 of the French Data Protection Act.
  • CNIL explained the case against Amazon:
    • [CNIL] noticed two breaches of Article 82 of the French Data Protection Act:
    • Deposit of cookies without obtaining the prior consent of the user
      • The restricted committee noted that when a user visited one of the pages of the website amazon.fr, a large number of cookies used for advertising purposes was automatically placed on his or her computer, before any action required on his or her part. Yet, the restricted committee recalled that this type of cookies, which are not essential to the service, can only be placed after the user has expressed his or her consent. It considered that the deposit of cookies at the same time as arriving on the site was a practice which, by its nature, was incompatible with a prior consent.
    • Lack of information provided to the users of the website amazon.fr
      • First, the restricted committee noted that, in the case of a user visiting the website amazon.fr, the information provided was neither clear, nor complete.
      • It considered that the information banner displayed by the company, which was “By using this website, you accept our use of cookies allowing to offer and improve our services. Read More.”, only contained a general and approximate information regarding the purposes of all the cookies placed. In particular, it considered that, by reading the banner, the user could not understand that cookies placed on his or her computer were mainly used to display personalized ads. It also noted that the banner did not explain to the user that it could refuse these cookies and how to do it.
      • Then, the restricted committee noticed that the company’s failure to comply with its obligation was even more obvious regarding the case of users that visited the website amazon.fr after they had clicked on an advertisement published on another website. It underlined that in this case, the same cookies were placed but no information was provided to the users about that.
• Senator Amy Klobuchar (D-MN) wrote the Secretary of Health and Human Services (HHS), to express “serious concerns regarding recent reports on the data collection practices of Amazon’s health-tracking bracelet (Halo) and to request information on the actions [HHS] is taking to ensure users’ health data is secure.” Klobuchar stated:
  • The Halo is a fitness tracker that users wear on their wrists. The tracker’s smartphone application (app) provides users with a wide-ranging analysis of their health by tracking a range of biological metrics including heartbeat patterns, exercise habits, sleep patterns, and skin temperature. The fitness tracker also enters into uncharted territory by collecting body photos and voice recordings and transmitting this data for analysis. To calculate the user’s body fat percentage, the Halo requires users to take scans of their body using a smartphone app. These photos are then temporarily sent to Amazon’s servers for analysis while the app returns a three-dimensional image of the user’s body, allowing the user to adjust the image to see what they would look like with different percentages of body fat. The Halo also offers a tone analysis feature that examines the nuances of a user’s voice to indicate how the user sounds to others. To accomplish this task, the device has built-in microphones that listen and records a user’s voice by taking periodic samples of speech throughout the day if users opt-in to the feature.
  • Recent reports have raised concerns about the Halo’s access to this extensive personal and private health information. Among publicly available consumer health devices, the Halo appears to collect an unprecedented level of personal information. This raises questions about the extent to which the tracker’s transmission of biological data may reveal private information regarding the user’s health conditions and how this information can be used. Last year, a study by BMJ (formerly the British Medical Journal) found that 79 percent of health apps studied by researchers were found to share user data in a manner that failed to provide transparency about the data being shared. The study concluded that health app developers routinely share consumer data with third-parties and that little transparency exists around such data sharing.
  • Klobuchar asked the Secretary of Health and Human Services Alex Azar II to “respond to the following questions:
    • What actions is HHS taking to ensure that fitness trackers like Halo safeguard users’ private health information?
    • What authority does HHS have to ensure the security and privacy of consumer data collected and analyzed by health tracking devices like Amazon’s Halo?
    • Are additional regulations required to help strengthen privacy and security protections for consumers’ personal health data given the rise of health tracking devices? Why or why not?
    • Please describe in detail what additional authority or resources that the HHS could use to help ensure the security and protection of consumer health data obtained through health tracking devices like the Halo.

Coming Events

• On 15 December, the Senate Judiciary Committee’s Intellectual Property Subcommittee will hold a hearing titled “The Role of Private Agreements and Existing Technology in Curbing Online Piracy” with these witnesses:
  • Panel I
    • Ms. Ruth Vitale, Chief Executive Officer, CreativeFuture
    • Mr. Probir Mehta, Head of Global Intellectual Property and Trade Policy, Facebook, Inc.
    • Mr. Mitch Glazier, Chairman and CEO, Recording Industry Association of America
    • Mr. Joshua Lamel, Executive Director, Re:Create
  • Panel II
    • Ms. Katherine Oyama, Global Director of Business Public Policy, YouTube
    • Mr. Keith Kupferschmid, Chief Executive Officer, Copyright Alliance
    • Mr. Noah Becker, President and Co-Founder, AdRev
    • Mr. Dean S. Marks, Executive Director and Legal Counsel, Coalition for Online Accountability
• The Senate Armed Services Committee’s Cybersecurity Subcommittee will hold a closed briefing on Department of Defense Cyber Operations on 15 December with these witnesses:
  • Mr. Thomas C. Wingfield, Deputy Assistant Secretary of Defense for Cyber Policy, Office of the Under Secretary of Defense for Policy
  • Mr. Jeffrey R. Jones, Vice Director, Command, Control, Communications and Computers/Cyber, Joint Staff, J-6
  • Ms. Katherine E. Arrington, Chief Information Security Officer for the Assistant Secretary of Defense for Acquisition, Office of the Under Secretary of Defense for Acquisition and Sustainment
  • Rear Admiral Jeffrey Czerewko, United States Navy, Deputy Director, Global Operations, J39, J3, Joint Staff
• The Senate Banking, Housing, and Urban Affairs Committee’s Economic Policy Subcommittee will conduct a hearing titled “US-China: Winning the Economic Competition, Part II” on 16 December with these witnesses:
  • The Honorable Will Hurd, Member, United States House of Representatives;
  • Derek Scissors, Resident Scholar, American Enterprise Institute;
  • Melanie M. Hart, Ph.D., Senior Fellow and Director for China Policy, Center for American Progress; and
  • Roy Houseman, Legislative Director, United Steelworkers (USW).
• On 17 December the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency’s (CISA) Information and Communications Technology (ICT) Supply Chain Risk Management (SCRM) Task Force will convene for a virtual event, “Partnership in Action: Driving Supply Chain Security.”

© Michael Kans, Michael Kans Blog and michaelkans.blog, 2019-2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Michael Kans, Michael Kans Blog, and michaelkans.blog with appropriate and specific direction to the original content.

Photo by Naya Shaw from Pexels