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The Almighty Buck

Dell In Hot Water For Making Shoppers Think Overpriced Monitors Were Discounted (arstechnica.com) 70

An anonymous reader quotes a report from Ars Technica: Dell Technologies' Australia subsidiary misled online shoppers into thinking that adding a monitor to their purchase would get them a discount on the display, even though doing so sometimes resulted in customers paying a higher price for the monitor than if they had bought it on its own. That's according to a declaration by the Australian Federal Court on Monday. The deceptive practices happened on Dell's Australian website, but they serve as a reminder to shoppers everywhere that a strikethrough line or sale stamp on an online retailer doesn't always mean you're getting a bargain. On June 5, the Federal Court said Dell Australia was guilty of making "false or misleading representations with respect to the price" of monitors that its website encouraged shoppers to add to their purchase. The purchases were made from August 2019 to the middle of December 2021.

The website would display the add-on price alongside a higher price that had a strikethrough line, suggesting that the monitor was typically sold at the price with the line going through it but that customers would get a discount if they added it to their cart at purchase. (The Australian Competition & Consumer Commission, or ACCC, posted a screenshot example here.) However, the strikethrough prices weren't actually representative of what Dell was charging for the monitors for most of the time before the purported discount. In fact, the allegedly discounted price occasionally turned out to be a rip-off, as ACCC commission Liza Carver said in a statement today: "In some cases, consumers paid more for the add-on monitor advertised as 'discounted' than they would have paid if they had bought it as a stand-alone product, which is shocking."

The Australian Federal Court also found that Dell's Australian website used deceptive language, like "Includes x% off," "Total Savings" plus a dollar amount, "Discounted Price" and a dollar amount, and "Get the best price for popular accessories when purchased with this product." According to the ACCC, shoppers spent over $2 million Australian dollars ($1.33 million USD) on 5,300 add-on monitors during this time period. The Australian Federal Court ordered Dell Australia to give full or partial refunds to affected customers. The company must also hire an "independent compliance professional" and contact affected customers. The Australian Federal Court will take comment on further penalties Dell Australia should incur, which could include fines, at a future date.
Dell told The Register: "As we acknowledged in November 2022 when the ACCC commenced these proceedings, due to an unrectified error on our part, our web page misrepresented the level of savings consumers could achieve by purchasing a monitor in conjunction with a desktop, laptop, or notebook."

Dell is looking into refunding customers, "plus interest," Dell's statement to The Register added, and the company is "taking steps to improve our pricing processes to ensure this sort of error does not happen again."
Biotech

Health Firm 'Grail' Wrongly Told Hundreds of People They Might Have Cancer (cbsnews.com) 27

An anonymous reader quotes a report from CBS News: A biotechnology company selling a $949 blood test that it bills as a "first of its kind" to detect cancer said it incorrectly informed about 400 customers that they might have the disease. The Menlo Park, California, company, called Grail, said it sent a form letter to some customers who had bought its Galleri test, which detects a marker for more than 50 types of cancer, "stating incorrectly that a cancer signal was detected," a company spokeswoman told CBS MoneyWatch in a statement. The company blamed a vendor, PWN Health, for the error, citing a "software configuration issue."

In a statement, PWN Health said it said the problem was due to "a misconfiguration of our patient engagement platform used to send templated communications to individuals." It added that it has added processes to make sure such a mistake doesn't occur again, and started contacting the people who received the erroneous letters within 36 hours. The error comes amid an increased demand for health care screening tests, especially for chronic diseases such as cancer.

Grail is billing its service as a complement to routine single-cancer tests for diseases such as colon or breast cancer, and said that the blood test can detect forms of the disease that aren't routinely screened for, such as in the gallbladder and pancreas. Grail said it hasn't received reports of patient harm or "adverse events" due to the erroneous letters.
"After being notified of the incident, Grail immediately began outreach by phone or email to all individuals who received the PWNHealth letter, and we continued our efforts until we confirmed we successfully reached each individual via phone, email or letter," the spokeswoman said. "The issue was in no way related to or caused by an incorrect Galleri laboratory test result."

More than half the erroneous letters were sent to customers who hadn't had their blood drawn yet for the Galleri test, the spokeswoman added.

On Monday, Illumina filed an appeal against a FTC order, "demanding that it divest cancer diagnostic test maker Grail over competition concerns in the U.S. market for cancer tests," reports Reuters. According to the filing, Illumina is arguing that the FTC "violated due process by depriving Illumina and Grail of a fair proceeding before an impartial tribunal."
The Courts

SEC Asks For Emergency Order To Freeze Binance US Assets Anywhere In the World (cnbc.com) 9

The U.S. Securities and Exchange Commission (SEC) has filed an emergency motion seeking to freeze the assets of Binance's U.S. platform and repatriate the funds held by its customers, including both fiat currency and cryptocurrencies. CNBC reports: The freezing order only applies Binance's two U.S. holding companies, not to the non-U.S. regulated international exchange. The order would apply to dozens of accounts held at Axos Bank, the defunct Silvergate Bank, Prime Trust, and other institutions. Two foreign entities also controlled by Zhao, Sigma Chain and Merit Peak, served as conduits for billions of dollars of customer money that was improperly commingled with Binance's funds, the SEC has alleged.

The emergency restraining order was necessary, the regulator argued, to "prevent the dissipation of available assets for any judgment, given the Defendants' years of violative conduct, disregard of the laws of the United States." The order also compels Binance's founder, Changpeng Zhao, to "show cause why a preliminary injunction" against Zhao and his two holding companies "should not be entered." The restraining order would also prevent all three entities from destroying evidence.
On Monday, the SEC filed a lawsuit against Binance and the company's founder, Changpeng Zhao, accusing the exchange of mishandling customer funds as well as lying to regulators and investors about its operations.
Microsoft

Microsoft To Pay $20 Million Settlement For Illegally Collecting Children's Personal Data (techcrunch.com) 15

Microsoft has agreed to pay $20 million to settle charges by the Federal Trade Commission (FTC) that it illegally collected personal information from children without parental consent and retained it for extended periods. TechCrunch reports: The federal consumer watchdog said Microsoft violated the Children's Online Privacy Protection Act (COPPA), the federal law that governs the online privacy protections for children under the age of 13, which requires companies notify parents about the data they collect, obtain parental consent and delete the data when it's no longer necessary. The FTC said children signing up to Microsoft's Xbox gaming service were asked to provide their personal information -- including their name, email address, phone number and date of birth -- which until 2019 included a pre-filled check box allowing Microsoft to share user information with advertisers. The FTC said Microsoft collected this data before asking for the parent to complete the account setup, but held onto children's data even if the parent abandoned the sign-up process.

"Only after gathering that raft of personal data from children did Microsoft get parents involved in the process," said FTC's Lesley Fair in a corresponding blog post. As a result, the FTC will require Microsoft to notify parents and obtain consent for accounts created before May 2021. Microsoft will also have to establish new systems to delete children's personal information if it hasn't obtained parental consent, and to ensure the data is deleted when it's no longer needed.

The Courts

SEC Sues Coinbase Over Exchange and Staking Programs (cnbc.com) 31

The Securities and Exchange Commission sued crypto exchange Coinbase in New York federal court on Tuesday morning, alleging that the company was acting as an unregistered broker and exchange and demanding that the company be "permanently restrained and enjoined" from continuing to do so. From a report: Coinbase's flagship prime brokerage, exchange and staking programs violate securities laws, the regulator alleged in its complaint. The company "has for years defied the regulatory structures and evaded the disclosure requirements" of U.S. securities law. The SEC has alleged that at least 13 crypto assets available to Coinbase customers were considered "crypto asset securities" by the regulator. Those assets include Solana's SOL token, Cardano's token and Protocol Labs' Filecoin token. "We allege that Coinbase, despite being subject to the securities laws, commingled and unlawfully offered exchange, broker-dealer, and clearinghouse functions," said SEC chair Gary Gensler said in a statement.
Facebook

More Than 2,000 Families Suing Social Media Companies Over Kids' Mental Health (cbsnews.com) 92

schwit1 shares a report from CBS News: When whistleblower Frances Haugen pulled back the curtain on Facebook in the fall of 2021, thousands of pages of internal documents showed troubling signs that the social media giant knew its platforms could be negatively impacting youth, and were doing little to effectively change it. With around 21 million American adolescents on social media, parents took note. Now, families are suing social media. Since we first reported this story last December, the number of families pursuing lawsuits has grown to over 2,000. More than 350 lawsuits are expected to move forward this year against TikTok, Snapchat, YouTube, Roblox and Meta -- the parent company to Instagram and Facebook.

Kathleen Spence: They're holding our children hostage and they're seeking and preying on them. Sharyn Alfonsi: Preying on them? Kathleen Spence: Yes. The Spence family is suing social media giant Meta. Kathleen and Jeff Spence say Instagram led their daughter Alexis into depression and to an eating disorder at the age of 12. [...] Attorney Matt Bergman represents the Spence family. He started the Social Media Victims Law Center after reading the Facebook papers and is now working with more than 1,800 families who are pursuing lawsuits against social media companies like Meta. Matt Bergman: Time and time again, when they have an opportunity to choose between safety of our kids and profits, they always choose profits.

This summer, Bergman and his team plan on starting the discovery process for the federal case against Meta and other social media companies, a multi-million dollar suit that he says is more about changing policy than financial compensation. This summer, Bergman and his team plan on starting the discovery process for the federal case against Meta and other social media companies, a multi-million dollar suit that he says is more about changing policy than financial compensation. Matt Bergman: They have intentionally designed a product that is addictive. They understand that if children stay online, they make more money. It doesn't matter how harmful the material is.

The Courts

SEC Accuses Binance of Mishandling Funds and Lying To Regulators (nytimes.com) 21

The Securities and Exchange Commission has accused Binance, the world's largest cryptocurrency exchange, of mishandling customer funds as well as lying to regulators and investors about its operations in a sweeping case filed in federal court on Monday. From a report: The Wall Street regulator said Binance had been mixing "billions of dollars" in customer funds and secretly sending them to a separate company controlled by Binance's founder, Changpeng Zhao. The charges included misleading investors about the adequacy of its systems to detect and control manipulative trading. Regulators also said Binance did not take sufficient steps to restrict U.S. investors from accessing Binance's unregulated exchange.

"We allege that Zhao and the Binance entities not only knew the rules of the road, but they also consciously chose to evade them and put their customers and investors at risk," said Gurbir S. Grewal, director of the S.E.C.'s enforcement division. The nation's top securities regulator filed 13 charges against Binance and Mr. Zhao, better known in the crypto world as "C.Z." The S.E.C. is taking action a little over a month after the Commodities Futures Trading Commission filed its own civil enforcement action against Binance and Mr. Zhao.

Government

Judge Clears Massachusetts to Finally Enforce Its Right-to-Repair Law (boston.com) 67

An anonymous reader shared this report from Boston.com. On Thursday, Massachusetts Attorney general Andrea Campbell "began enforcing the state's new right-to-repair law following years of bitter debate and a wildly expensive ballot initiative that was approved by voters in 2020." In a nutshell, the law requires automakers selling cars in the state to provide customers and independent repair businesses with access to a type of information called "telematics." The term refers to information that is first detected by a car and then transmitted wirelessly elsewhere. This information can be used to easily ascertain problems with a vehicle...

Now, new car dealers must tell buyers what kind of data is being collected by a car's telematics system and provide them with a way to access that data. It must also be accessible to independent auto repair shops. If this does not happen, car owners and repairs shops can sue carmakers either triple damages or $10,000, whichever is greater. Manufacturers must equip vehicles starting with model year 2022 with a standardized platform for telematics data that owners can access through a mobile application. Owners can then make this information available to independent repair shops and dealers...

The lawsuit has yet to be resolved, and last week carmakers asked US District Judge Douglas Woodlock to issue a temporary restraining order that would prevent Campbell from enforcing the law. In a hearing Woodlock took issue with the law, calling its goal "likely unattainable" and that its enforcement could harm carmakers, according to the Globe. But ultimately Woodlock said that he would not block enforcement.

"The people have voted on this and that's the result," he said. "I am loath to impose my own views on the initiative."

Piracy

Music Pirates Are Not Terrorists, Record Labels Argue In Court (torrentfreak.com) 46

An anonymous reader quotes a report from TorrentFreak: A Virginia jury held Cox liable for pirating subscribers because it failed to terminate accounts after repeated accusations, ordering the company to pay $1 billion in damages to the labels. This landmark ruling is currently under appeal. As part of the appeal, Cox informed the court of a supplemental authority that could support its position. The case in question is Twitter vs. Taamneh, in which the U.S. Supreme Court recently held that the social media platform isn't liable for ISIS terrorists, who used Twitter to recruit and raise funds. The Supreme Court rejected (PDF) the claim that Twitter aided-and-abetted terrorist activity, because it didn't "consciously and culpably" participate in the illegal activity. According to Cox, the same logic applies in its case, where the ISP was held liable for the piracy activities of subscribers.

"These same aiding-and-abetting principles animate copyright law's contributory liability doctrine, and they likewise foreclose liability here," an attorney for Cox informed the court. Cox argues that the Supreme Court ruling confirms that aiding-and-abetting liability only applies when parties knowingly took part in the activity. That runs contrary to the finding in its own dispute with the record labels, where "culpable expression and conduct" or "intent" were not required. "Though Twitter arises in a different context, its reasoning applies with full force and supports reversal of the contributory infringement verdict," Cox added. The two cases are indeed quite different, but ultimately they are about imposing liability on third-party services.

According to Cox, the Twitter terrorist ruling clearly shows that it isn't liable for pirating subscribers, but the music companies see things differently. Earlier this week, the music labels responded in court (PDF), countering Cox's arguments. They argue that the Twitter ruling doesn't apply to their piracy dispute with Cox, as the cases are grounded in different laws. While the music industry certainly isn't happy with pirates, the Cox case is a copyright matter while the Twitter lawsuit fell under the Justice Against Sponsors of Terrorism Act. And for now, pirates are not categorized as terrorists. After establishing the difference between pirates and terrorists, the music companies point out that Twitter wasn't directly connected to the misconduct. The platform's role was more passive and its connection to ISIS was more distant than Cox's connection to its subscribers. Cox took a more active role and materially contributed to the pirating activities, which stands no comparison to the Twitter case, plaintiffs argue.

The Courts

US Judge Orders Lawyers To Sign AI Pledge, Warning Chatbots 'Make Stuff Up' (reuters.com) 24

An anonymous reader quotes a report from Reuters: A federal judge in Texas is now requiring lawyers in cases before him to certify that they did not use artificial intelligence to draft their filings without a human checking their accuracy. U.S. District Judge Brantley Starr of the Northern District of Texas issued the requirement on Tuesday, in what appears to be a first for the federal courts. In an interview Wednesday, Starr said that he created the requirement to warn lawyers that AI tools can create fake cases and that he may sanction them if they rely on AI-generated information without verifying it themselves. "We're at least putting lawyers on notice, who might not otherwise be on notice, that they can't just trust those databases. They've got to actually verify it themselves through a traditional database," Starr said.

In the notice about the requirement on his Dallas court's website, Starr said generative AI tools like ChatGPT are "incredibly powerful" and can be used in the law in other ways, but they should not be used for legal briefing. "These platforms in their current states are prone to hallucinations and bias. On hallucinations, they make stuff up -- even quotes and citations," the statement said. The judge also said that while attorneys swear an oath to uphold the law and represent their clients, the AI platforms do not. "Unbound by any sense of duty, honor, or justice, such programs act according to computer code rather than conviction, based on programming rather than principle," the notice said.

Starr said on Wednesday that he began drafting the mandate while attending a panel on artificial intelligence at a conference hosted by the 5th Circuit U.S. Court of Appeals, where the panelists demonstrated how the platforms made up bogus cases. The judge said he considered banning the use of AI in his courtroom altogether, but he decided not to do so after conversations with Eugene Volokh, a law professor at the UCLA School of Law, and others. Volokh said Wednesday that lawyers who use other databases for legal research might assume they can also rely on AI platforms. "This is a way of reminding lawyers they can't assume that," Volokh said.
Starr issued the requirement days after another judge threatened to sanction a lawyer for using ChatGPT to help write court filings that cited six nonexistent cases.
The Courts

Getty Asks London Court To Stop UK Sales of Stability AI System (reuters.com) 29

Stock photo provider Getty Images has asked London's High Court for an injunction to prevent artificial intelligence company Stability AI from selling its AI image-generation system in Britain, court filings show. From a report: The Seattle-based company accuses the company of breaching its copyright by using its images to "train" its Stable Diffusion system, according to the filing dated May 12. Stability AI has yet to file a defence to Getty's lawsuit, but filed a motion to dismiss Getty's separate U.S. lawsuit last month. It did not immediately respond to a request for comment.
The Courts

Airbnb Sues NYC Over Limits On Short-Term Rentals (nytimes.com) 88

Airbnb has sued New York City in an attempt to overturn strict new regulations that restrict short-term rentals, claiming that the rules are "extreme and oppressive." The New York Times reports: A new law, passed by the city in 2021, sought to prevent illegal short-term rentals by requiring hosts to register with the city. Short-term rentals -- for fewer than 30 consecutive days -- have largely been barred if hosts are not present, according to state law, though the city and Airbnb have disagreed about how expansive such prohibitions and other complicated city codes should be. The city said it would start enforcing the law in July.

In the lawsuit filed on Thursday, Airbnb called the new scheme "extreme and oppressive" and said it clashes with a federal law that has shielded many tech platforms from liability for content posted by its users. Three Airbnb hosts also filed similar lawsuits, arguing that the rules were so complicated that nearly all hosts, even those who intended to be present when guests were around, would be unable to use the platform. The city said it was reviewing the lawsuit.
"This administration is committed to protecting safety and community livability for residents, preserving permanent housing stock, and ensuring our hospitality sector can continue to recover and thrive," Jonah Allon, a spokesman for the mayor, said in a statement.
Privacy

Amazon To Pay $30 Million For Alexa, Ring Privacy Violations (reuters.com) 16

Amazon and its subsidiary, Ring, have agreed to separate multi-million dollar settlements with the U.S. Federal Trade Commission (FTC) over privacy violations involving children's use of Alexa and homeowners' use of Ring doorbell cameras. Amazon will pay $25 million for failing to delete Alexa recordings as requested by parents and for keeping them longer than necessary, while Ring will pay $5.8 million for mishandling customers' videos. Reuters reports: "While we disagree with the FTC's claims regarding both Alexa and Ring, and deny violating the law, these settlements put these matters behind us," Amazon.com said in a statement. It also pledged to make some changes to its practices.

In its complaint against Amazon.com filed in Washington state, the FTC said that it violated rules protecting children's privacy and rules against deceiving consumers who used Alexa. For example, the FTC complaint says that Amazon told users it would delete voice transcripts and location information upon request, but then failed to do so.

The FTC also said Ring gave employees unrestricted access to customers' sensitive video data said "as a result of this dangerously overbroad access and lax attitude toward privacy and security, employees and third-party contractors were able to view, download, and transfer customers' sensitive video data for their own purposes." As part of the FTC agreement with Ring, which spans 20 years, Ring is required to disclose to customers how much access to their data the company and its contractors have.

The Courts

Supreme Court Declines To Hear Bid To Sue Reddit Over Child Porn (reuters.com) 99

An anonymous reader quotes a report from Reuters: The U.S. Supreme Court on Tuesday declined to hear a bid by child pornography victims to overcome a legal shield for internet companies in a case involving a lawsuit accusing Reddit Inc of violating federal law by failing to rid the discussion website of this illegal content. The justices turned away the appeal of a lower court's decision to dismiss the proposed class action lawsuit on the grounds that Reddit was shielded by a U.S. statute called Section 230, which safeguards internet companies from lawsuits for content posted by users but has an exception for claims involving child sex trafficking. The Supreme Court on May 19 sidestepped an opportunity to narrow the scope of Section 230 immunity in a separate case.

Section 230 of the Communications Decency Act of 1996 protects "interactive computer services" by ensuring they cannot be treated as the "publisher or speaker" of information provided by users. The Reddit case explored the scope of a 2018 amendment to Section 230 called the Fight Online Sex Trafficking Act (FOSTA), which allows lawsuits against internet companies if the underlying claim involves child sex trafficking. Reddit allows users to post content that is moderated by other users in forums called subreddits. The case centers on sexually explicit images and videos of children posted to such forums by users. The plaintiffs -- the parents of minors and a former minor who were the subjects of the images -- sued Reddit in 2021 in federal court in California, seeking monetary damages. The plaintiffs accused Reddit of doing too little to remove or prevent child pornography and of financially benefiting from the illegal posts through advertising in violation of a federal child sex trafficking law.

The San Francisco-based 9th U.S. Circuit Court of Appeals in 2022 concluded that in order for the exception under FOSTA to apply, plaintiffs must show that an internet company "knowingly benefited" from the sex trafficking through its own conduct. Instead, the 9th Circuit concluded, the allegations "suggest only that Reddit 'turned a blind eye' to the unlawful content posted on its platform, not that it actively participated in sex trafficking." Reddit said in court papers that it works hard to find and prevent the sharing of child sexual exploitation materials on its platform, giving all users the ability to flag posts and using dedicated teams to remove illegal content.

Electronic Frontier Foundation

Federal Judge Makes History In Holding That Border Searches of Cell Phones Require a Warrant (eff.org) 79

In a groundbreaking ruling, a district court judge in New York, United States v. Smith (S.D.N.Y. May 11, 2023), declared that a warrant is necessary for cell phone searches at the border, unless there are urgent circumstances. The Electronic Frontier Foundation (EFF) reports: The Ninth Circuit in United States v. Cano (2019) held that a warrant is required for a device search at the border that seeks data other than "digital contraband" such as child pornography. Similarly, the Fourth Circuit in United States v. Aigbekaen (2019) held that a warrant is required for a forensic device search at the border in support of a domestic criminal investigation. These courts and the Smith court were informed by Riley v. California (2014). In that watershed case, the Supreme Court held that the police must get a warrant to search an arrestee's cell phone. [...]

The Smith court's application of Riley's balancing test is nearly identical to the arguments we've made time and time again. The Smith court also cited Cano, in which the Ninth Circuit engaged extensively with EFF's amicus brief even though it didn't go as far as requiring a warrant in all cases. The Smith court acknowledged that no federal appellate court "has gone quite this far (although the Ninth Circuit has come close)."

We're pleased that our arguments are moving through the federal judiciary and finally being embraced. We hope that the Second Circuit affirms this decision and that other courts -- including the Supreme Court -- are courageous enough to follow suit and protect personal privacy.

Education

Student Loan Payment Pause 'Gone' Under Debt Ceiling Deal 399

Longtime Slashdot reader theodp writes: House Speaker Kevin McCarthy (R-CA) said on Sunday that the student loan payment pause is "gone" in the debt ceiling deal announced by the California Republican and President Biden late Saturday night. "The pause is gone within 60 days of this being signed. So that is another victory because that brings in $5 billion each month to the American public," McCarthy told Fox News on Sunday. McCarthy's remarks came after he and Biden came to an agreement in principle late Saturday to cap spending and raise the debt ceiling.

"What the president did, he went unconstitutionally and said he was going to waive certain people part of their debt for student loan, but then he paused everybody's student loan. So everybody who borrowed a student loan within 60 days of the signing is going to have to pay that back," McCarthy added. "The Supreme Court is taking up that case. But if the Supreme Court came back and said that was unconstitutional, the president could still say he's pausing, not waiving it. But now that this is in law, the Supreme Court decision will have to be upheld, that they would have to pay."

Earlier this month, the NY Times warned students and their families to "Expect Interest Rates on Federal Student Loans to Rise" to as high as 8.05% for new PLUS loans this fall. That news came as Apple, just days after a recent $90 billion share buyback, filed a prospectus with the SEC for a new $5 billion bond program with longer-term bonds expected to have a coupon rate of approximately 5%. The imbalance between loan rates for students and Apple shareholders was actually far more pronounced before the Fed fund rate hikes started last year in response to inflation. During the pandemic, Apple -- which reported around $166.3 billion in cash and investments on its balance sheet as of March 31 -- held a bond sale worth $14 billion for stock buybacks and dividends to benefit from borrowing rates as low as 0.70%. Direct PLUS student loan rates at that time were down to 5.30% for new loans but as high as 8.5% for existing loans (the U.S. Dept. of Education does not offer refinancing of its up-to-30-year fixed rate loans in times of much lower interest rates). Unlike the tax-deductible interest Apple pays, annual deductions on student loan interest are capped by the IRS at $2,500 (or lower, depending on the borrower's income).

Despite presumably benefiting from stock buybacks and dividends facilitated by Apple's low-interest bonds -- some of which carry rates as much as 90%+ lower than certain federal student loans -- some of the Senators identified as Apple shareholders by NBCLX are vehemently opposed to the idea of student loan relief for high interest-paying borrowers. Senator Shelley Capito (R-WV) opposes the program as "not fair", Senator Pat Toomey (R-PA) called it "grossly unfair", and other Apple-shareholder Senators joined (PDF) colleagues in a Supreme Court filing calling student loan relief "unnecessary".
Biotech

Theranos CEO Elizabeth Holmes Begins 11-Year Prison Sentence (bbc.com) 77

Disgraced Theranos founder Elizabeth Holmes has begun her 11-year prison sentence after being convicted of four counts of fraud. The BBC reports: She will serve her term in a minimum-security prison in Texas. Holmes reported to the federal facility in Bryan, Texas, which holds between 500 and 700 inmates at any given time, on Tuesday. It is about 100 miles (160km) north of Houston, her hometown. Her arrival at the facility was confirmed by the Federal Bureau of Prisons, which declined to give any more details about her confinement, citing privacy concerns.

There, the woman once billed as the world's youngest self-made billionaire might work alongside other inmates for between 12 cents (10p) and $1.15 (93p) an hour - much of which will go towards her court-mandated restitution payments. [...] The Texas prison camp where Holmes will serve time is a sprawling 37-acre facility. Most inmates there have been convicted of non-violent crimes, low-level drug dealing or white-collar offenses. According to the facility's handbook, life largely revolves around work and extracurricular activities that include foreign language, computer literacy or business courses.

Holmes had fought to stay out of prison while her legal appeal works its way through the courts. She argued a delay would allow her to raise "substantial questions" about the case that could warrant a new trial. Her defense team also argued that she should remain free to care for her children, one who is nearly two and the other three months old. The Wall Street Journal reported the prison has facilities where inmates can host gatherings and where children can play. Holmes and other mothers are allowed to hold their children in their lap and breastfeed their infants, according to official Bureau of Prison guidelines.

The Courts

Lawyer Cited 6 Fake Cases Made Up By ChatGPT; Judge Calls It 'Unprecedented' (arstechnica.com) 48

An anonymous reader quotes a report from Ars Technica: A lawyer is in trouble after admitting he used ChatGPT to help write court filings that cited six nonexistent cases invented by the artificial intelligence tool. Lawyer Steven Schwartz of the firm Levidow, Levidow, & Oberman "greatly regrets having utilized generative artificial intelligence to supplement the legal research performed herein and will never do so in the future without absolute verification of its authenticity," Schwartz wrote in an affidavit (PDF) on May 24 regarding the bogus citations previously submitted in US District Court for the Southern District of New York.

Schwartz wrote that "the use of generative artificial intelligence has evolved within law rms" and that he "consulted the artificial intelligence website ChatGPT in order to supplement the legal research performed." The "citations and opinions in question were provided by ChatGPT which also provided its legal source and assured the reliability of its content," he wrote. Schwartz admitted that he "relied on the legal opinions provided to him by a source that has revealed itself to be unreliable," and stated that it is his fault for not confirming the sources provided by ChatGPT. Schwartz didn't previously consider the possibility that an artificial intelligence tool like ChatGPT could provide false information, even though AI chatbot mistakes have been extensively reported by non-artificial intelligence such as the human journalists employed by reputable news organizations. The lawyer's affidavit said he had "never utilized ChatGPT as a source for conducting legal research prior to this occurrence and therefore was unaware of the possibility that its content could be false."

Federal Judge Kevin Castel is considering punishments for Schwartz and his associates. In an order on Friday, Castel scheduled a June 8 hearing at which Schwartz, fellow attorney Peter LoDuca, and the law firm must show cause for why they should not be sanctioned. "The Court is presented with an unprecedented circumstance," Castel wrote in a previous order on May 4. "A submission filed by plaintiff's counsel in opposition to a motion to dismiss is replete with citations to non-existent cases... Six of the submitted cases appear to be bogus judicial decisions with bogus quotes and bogus internal citations." [...] In the order issued on Friday last week, Castel said that Schwartz may be sanctioned for "the citation of non-existent cases to the Court," "the submission to the Court of copies of non-existent judicial opinions," and "the use of a false and fraudulent notarization." Schwartz may also be referred to an attorney grievance committee for additional punishment.
Castel wrote that LoDuca may be sanctioned "for the use of a false and fraudulent notarization in his affidavit filed on April 25, 2023." The law firm could be sanctioned for "the citation of non-existent cases to the Court," "the submission to the Court of copies of non-existent judicial opinions annexed to the Affidavit filed on April 25, 2023," and "the use of a false and fraudulent notarization in the affidavit filed on April 25, 2023."
China

After Being Wrongfully Accused of Spying for China, Professor Wins Appeal To Sue the Government 89

Xiaoxing Xi, a Temple University professor who was falsely accused of spying for China, will be able to bring a lawsuit against the Federal Bureau of Investigation. From a report: A judge at a federal appeals court ruled in favor of Xi on Wednesday, allowing the physicist to move forward with his case against the U.S. government for wrongful prosecution and violating his family's constitutional rights by engaging in unlawful search, seizure and surveillance. The decision comes after FBI agents swarmed Xi's Philadelphia home in 2015, rounded up his family at gunpoint, and arrested him on fraud charges related to economic espionage, before abruptly dropping the charges months afterward.

"I'm very, very glad that we can finally put the government under oath to explain why they decided to do what they did, violating our constitutional rights," Xi said in an exclusive interview with NBC News. "We finally have an opportunity to hold them accountable." The case will now be kicked back to the district court, continuing a long legal battle. Xi, who's represented in part by the American Civil Liberties Union, attempted to bring a suit against the government in 2017, alleging that FBI agents "made knowingly or recklessly false statements" to support their investigation and prosecution. Xi also claimed that his arrest was discriminatory, and that he was targeted due to his ethnicity, much like other scholars of Chinese descent. A district court dismissed his case in 2021, but Xi appealed the decision last year.
Government

Automakers Ask Judge to Block Pending Enforcement of Massachusetts' Right-to-Repair Law (bostonglobe.com) 64

"Beginning next Thursday, Massachusetts Attorney General Andrea Joy Campbell plans to start enforcing the state's automotive right-to-repair law," reports the Boston Globe. "But this week, the world's top automakers asked a federal judge to stop her." The Alliance for Automotive Innovation, a car industry trade group, sued to block enforcement of the law almost from the moment it was passed by voter referendum in 2020. Ever since, the law has been tied up in the courtroom of US District Judge Douglas Woodlock. Now the alliance has asked Woodlock to grant a temporary injunction that would stop Campbell from enforcing the law until he issues a final ruling in the case.

Campbell's predecessor, now-Governor Maura Healey, repeatedly refrained from enforcing the law, pending Woodlock's decision. But Healey always reserved the right to reverse this policy if a ruling took too long. In March, Campbell said she would start enforcing the law effective June 1. "The people of Massachusetts deserve the benefit of the law they approved more than two years ago," she said in a document filed with the court.

But the carmakers say that only the federal government has the authority to enact such a law. They claim the law is so poorly drafted that they can't comply with it, and even if they could, compliance would weaken vehicle security, making it easier for cyber criminals to steal digital data about vehicles and their owners. Two carmakers, Kia and Subaru, have tried to comply with the law by switching off the telematic services in their cars. But the carmakers argue that this deprives consumers of the right to use these features, which include emergency roadside assistance that could potentially save lives.

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