Consumer Protection is your Smartphone too smart?

by Archer & Greiner, P.C.
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Smartphone tracking of consumers locations will test the boundaries of the Computer Fraud and Abuse Act

By William E. Viss

The smartphone in your briefcase is probably tracking and storing your location. As a consumer, you may en-

joy this feature and even pay a premium to enhance its use. However, other smartphone owners are less impressed. They feel the manufacturers’ failure to disclose that such tracking occurs violates their privacy rights and constitutes fraud.

To mobilize these claims, unhappy con- sumers are turning to an old favorite — the Computer Fraud and Abuse Act (CFAA), 18

U.S.C. § 1030. The CFAA makes it unlawful for a person to access a protected computer without authorization, or to exceed autho- rized use. But does that mean mobile device manufacturers are guilty of a federal crime or subject to civil penalties for tracking a user’s location without the user’s consent? At least two Apple product owners say they are, and have filed a complaint to that effect. As a result, the courts are once again asked to determine the limits of the CFAA.

Viss is an associate with Archer & Greiner P.C. in Haddonfield. He is a mem- ber of the firm’s commercial litigation department and concentrates his practice in litigation services.

The Complaint

On April 22, plaintiffs Vikram Ajjam- pur, a Florida resident, and William Devito, a resident of New York state, filed a complaint in the United States District Court, Middle District of Florida, seeking class-action status and naming Apple, Inc., as the sole defendant. Ajjampur owns the iPhone, De- vito the 3G iPad. Both claim they travelled extensively with their devices, but were un- aware their locations were being tracked and stored. Due to the plaintiffs’ travels to nu- merous states, they also assert Apple’s track- ing policy violated not only the CFAA, but also infringed upon antifraud statutes of the states they visited, including the New Jersey Consumer Fraud Act, N.J.S.A. §§ 56:8-1 et seq.

At the heart of the plaintiffs’ complaint lie Apple’s alleged privacy violations. Cit- ing various Internet articles for support, the plaintiffs contend that the mobile devices “log, record and store users’ locations” and “download the user location data to the us- er’s computer when the mobile device syn- chronizes (‘syncs’) or shares data with the computer.” The plaintiffs further allege that Apple collects the users’ location informa tion “covertly, surreptitiously and in viola- tions of law” and in “conjunction with other businesses that develop applications for Apple’s devices” without obtaining a con- sumer’s informed consent.

In particular, the plaintiffs assert that because mobile Apple products such as the iPhone and the iPad travel with the user at all times, the information collected by Ap- ple is highly personal: “[I]ndeed, in many instances it may be information to which employers and spouses are not privy.” The plaintiffs warn that making such information publicly available “places users at serious risk of privacy invasions, including stalk- ing.” They further contend that the tracking caused them harm “because they were per- sonally tracked just as if by a tracking device for which a court-ordered warrant would or- dinarily be required,” and therefore demand that the court require Apple to reconfigure its tracking software in order to avoid collect- ing personal location information, or sync- ing the information with other computers.

The Boundaries of the CFaa

The complaint is one of many recent civil actions that will test the metes and bounds of the CFAA. Originally passed in

1986, the act was intended to curb computer hacking in the stricter sense of the word. See S. Rep. No. 99–432 at 2–3 (1986). At that time, regular use of computers was a recent phenomenon. As the number of computer crimes increased, Congress realized the cur- rent laws were insufficient to address un- lawful acts involving new technology and responded accordingly.

NEW JERSEY LAW JOURNAL, JULY 25, 2011

The resulting CFAA is a powerful statute supporting both criminal and civil causes of action. The civil remedy provides that any- one who “intentionally accesses a computer without authorization or exceeds authorized access, and thereby obtains . . . informa- tion from any protected computer” commits an unlawful act and may be held liable for damages, injunctive, or equitable relief. 18

U.S.C.A. § 1030 (a)(2)(C) & (g). The term “exceeds authorized access” is defined by the act to mean gaining “access to a computer with authorization and to use such access to obtain or alter information in the computer that the accesser is not entitled so to obtain or alter.” 18 U.S.C.A. § 1030(e)(6).

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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