close X
01/31/2017

Cause of Action Institute Files Motion to Dismiss FTC’s Baseless Data Security Charges Against D-Link Systems Inc.

WASHINGTON – Cause of Action Institute (“CoA Institute”) on behalf of D-Link Systems, Inc. today filed in the U.S. District Court for Northern California a Motion to Dismiss the baseless charges brought by the Federal Trade Commission (“FTC”) regarding the company’s security practices for consumer routers and IP cameras.

In an eleventh-hour attempt to expand its own authority to regulate the Internet of Things (“IoT”) before the new administration took office, the FTC in early January filed a complaint against D-Link Systems. The complaint makes vague and unsubstantiated allegations, without asserting a single data breach of any product sold by D-Link Systems in the U.S. Instead, the FTC speculates that consumers were placed “at risk,” to be hacked, but fails to allege, as it must, that consumers suffered or are likely to suffer actual substantial injuries. D-Link Systems stands behind its products and maintains a robust range of procedures to address potential security vulnerabilities.

“This is a case of politicized government overreach without justification or any evidence of consumer injury,” said Patrick Massari, assistant vice president, CoA Institute. “In fact, to her credit, Acting Chairwoman Ohlhausen voted not to bring this case and has spoken out against the agency filing other lawsuits ‘on the eve of a new presidential administration’ that are based on a flawed legal theory and lack economic and evidentiary support.

“This case should be dismissed now. Congress did not delegate to FTC the authority to regulate data security for IoT companies, and therefore FTC’s putative regulation is beyond its legal power. Moreover, the FTC fails in its Complaint to plead the basic elements of proof necessary for a Section 5 ‘unfairness’ violation. The FTC’s action sets a dangerous precedent, whereby the federal government could subject liability to any company that makes an internet-connected product. The FTC’s lawsuit violates D-Link Systems’ due process rights, and will no doubt have a chilling effect on innovation. For these reasons we have urged the Court to dismiss this Complaint in its entirety.”

The FTC has no authority under Section 5(n) of the FTC Act to declare unlawful an act or practice “on the grounds that such act or practice is unfair unless the act or practice causes or is likely to cause substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or to competition.” As D-Link Systems Inc.’s Motion to Dismiss points out, the FTC’s Complaint pleads legal conclusions couched as hypothetical, speculative factual allegations.  FTC’s “deception” allegations should also be dismissed for failure to meet the heightened pleading standards set by Federal Rule of Civil Procedure 9(b), which requires such claims to be pled with particularity.

Read the full Motion to Dismiss here Exhibits can be found here

About Cause of Action Institute:  Cause of Action Institute is a 501(c)(3) non-profit working to enhance individual and economic liberty by limiting the power of the administrative state to make decisions that are contrary to freedom and prosperity by advocating for a transparent and accountable government free from abuse.

For information regarding this press release, please contact Zachary Kurz, Director of Communications: zachary.kurz@causeofaction.org

Press Release, Media Learn More
01/31/2017

January Newsletter

Cause of Action Institute published its January newsletter today. You can read the newsletter here and subscribe to the newsletter here. The January newsletter highlights:

  • We will represent D-Link Systems, Inc. in its defense against recent unwarranted and baseless charges brought by the Federal Trade Commission regarding the company’s security practices for consumer routers and IP cameras;
  • we sued the Bureau of Land Management (BLM) to obtain access to records about the agency’s acquisition of land in Arizona, Nevada, and New Mexico. Americans deserve to understand how and why BLM wants to increase its control over land that could otherwise be used for private or state purposes; and
  • the D.C. Circuit Court of Appeals has overturned a ruling by the District Court in a lawsuit Cause of Action Institute filed against Secretary of State John Kerry and U.S. Archivist David Ferriero seeking to enforce their duties under the Federal Records Act as they relate to retrieval of Hillary Clinton’s emails.
Newsletter Archive, Newsletter Learn More
01/25/2017

CoA Institute files Amicus Brief on Behalf of Dr. Judith Curry in Support of Rigorous and Open Debate on Climate Science

Washington, D.C. – Jan. 25, 2017 – Cause of Action Institute (“CoA Institute”) today filed an amicus curiae brief on behalf of prominent climate scientist Dr. Judith A. Curry in support of a petition for rehearing in the Competitive Enterprise Institute v. Michael Mann lawsuit in the D.C. Court of Appeals.  The brief argues that Dr. Mann has transgressed the basic norms of scientific behavior and First Amendment principles by trying to use the court system to silence critics of his methodological approach to climate science.

“Scientists should not use the court system to silence people who are critical of their work.  Public exposure of a scientist’s methodologies and an openness to defend those methodologies is at the very core of scientific progress,” said Dr. Judith Curry.  “The court needs to know how far Dr. Mann has strayed from the core philosophy of science with this lawsuit.”

“Dr. Curry has been the repeated victim of Dr. Mann’s efforts to silence and harass her for criticizing his work.  She finds it hypocritical that Dr. Mann is trying to use the court system to silence his critics while engaging in similar behavior toward other scientists,” said CoA Institute Acting President John Vecchione.  “We are proud to have had the opportunity to help Dr. Curry express her staunch support for the First Amendment and her belief in the importance of maintaining a rigorous and open debate about climate science.”

The amicus brief is available here.  The brief was accompanied by a motion seeking the court’s leave to file.

About Cause of Action Institute
Cause of Action Institute is a 501(c)(3) non-profit working to enhance individual and economic liberty by limiting the power of the administrative state to make decisions that are contrary to freedom and prosperity by advocating for a transparent and accountable government free from abuse.

For information regarding this press release, please contact Zachary Kurz, Director of Communications at CoA Institute: zachary.kurz@causeofaction.org

Press Release, Media Learn More
01/25/2017

CoA Institute Sues BLM for Shielding Information on Expansion of Federal Lands

Washington, D.C. – Cause of Action Institute (“CoA Institute”) today sued the Bureau of Land Management (“BLM”) to obtain access to records about the agency’s acquisition of land in Arizona, Nevada, and New Mexico.  Last year, the BLM asked Congress for nearly $90 million for new purchases, even though the agency already is responsible for about 250 million acres of federally-owned land.  Americans deserve to understand how and why the BLM wants to increase its control over land that could otherwise be used for private or state purposes.

To shed light on the BLM’s land deals and ensure that the agency is responsibly managing its resources, CoA Institute submitted a Freedom of Information Act (“FOIA”) request on August 10, 2016 seeking purchase agreements, appraisals, and related communications.  Nearly six months later, the agency has failed to issue a final determination on CoA Institute’s request or produce responsive records as required by FOIA.

CoA Institute Assistant Vice President Lee Steven: “When the Bureau of Land Management buys private land to add to the hundreds of millions of acres the federal government already owns, Americans have a right to know why. According to the Congressional Research Service, the federal government owns almost half the land of 11 western states and more than 60 percent of Alaska. The last thing these states need is more federal control of their land.”

The full complaint can be found here.

Exhibits in the complaint can be found here.

CoA Institute is a non-profit strategic oversight group committed to ensuring that government decision-making is open, honest, and fair.

For information regarding this press release, please contact Zachary Kurz, Director of Communications: zachary.kurz@causeofaction.org

Press Release, Media Learn More
01/13/2017

CoA Institute Supports Strong Due Process on College Campuses

In a letter today to Senator Lamar Alexander, Chairman of the Committee on Health, Education, Labor & Pensions, Cause of Action Institute (“CoA Institute”) expressed its support for the mission of the Foundation for Individual Rights in Education (“FIRE”) to “defend and sustain individual rights at America’s colleges and universities.”

FIRE’s wide-ranging mission seeks to preserve the individual liberties vital to a just and free society, specifically by protecting freedom of speech, legal equality, due process, religious liberty and sanctity of conscience on America’s college campuses.

The letter states:

“Critics of FIRE’s advocacy for sufficient due process protections for all students—both accusers and accused—fail to acknowledge traditional notions of justice. Justice is not served if adjudications are overwhelmingly stacked against the accused due to their inability to defend themselves from false accusations.  FIRE merely fights for the adoption of due process protections Americans often take for granted in other proceedings: “the right to the active participation of counsel; the right to see the evidence in one’s case and to meaningfully question witnesses; and the right to an impartial tribunal, among others.”

Read the full letter HERE.

Blog, Media Learn More
01/12/2017

CoA Institute Urges Supreme Court to Restrict Agency Power

On January 10, 2017 Cause of Action Institute (CoA Institute) joined an amicus brief filed by the Cato Institute (Cato) in the Supreme Court case Gloucester County School Board v. G.G. to comment on an important aspect of administrative law: the scope of the Auer doctrine (taken from the Supreme Court case Auer v. Robbins (1997)), which holds that courts should generally defer to agency interpretations of their own regulations.  The case involves a challenge to a school board’s decision preventing GG, a transgender student, from using the school bathroom corresponding to his preferred gender identity.

After the board made its decision, the U.S. Department of Education weighed in, issuing an interpretive letter.  James Ferg-Cadima, the Acting Deputy Assistant Secretary for Policy for the Department of Education’s Office of Civil Rights, stated that “Title IX . . . prohibits recipients of Federal financial assistance from discriminating on the basis of sex, including gender identity, …When a school elects to separate or treat students differently on the basis of sex in those situations, a school generally must treat transgender students consistent with their gender identity.”  Thus, according to the letter, Title IX and its regulations would mandate that the school board allow GG to use his preferred bathroom.

GG sued in federal district court, alleging violations of Title IX and the Constitutions’ Equal Protection Clause.  The district court dismissed GG’s claims but on appeal the 4th Circuit overturned this decision and, applying the Auer doctrine, held that the district court should have deferred to the interpretation contained in the Ferg-Cadima letter, as the letter was not plainly erroneous or inconsistent with the statute or agency regulation.  The 4th Circuit so held even though the letter was not subject to any public consideration and was contrary to the prior understanding of Title IX’s requirements.  The case then proceeded to the Supreme Court.

CoA Institute joined with Cato and four law professors to file an amicus brief supporting the school board in order to address the issues related to Auer deference.  The brief calls the Auer doctrine into question and argues in favor of stricter limits on the latitude currently given to agencies interpreting their own regulations.  Among the problems noted by the brief are that this type of deference (1) provides incentives for agencies to issue vague regulations, which they can interpret at will without going through any public notice or comment procedures and (2) undermines the separation of powers by giving agencies the authority to both write regulations, a legislative function delegated by Congress, and to definitively determine their meaning, a judicial function.

You can read the brief here.

Josh Schopf is counsel at Cause of Action Institute

Blog, Media Learn More
01/10/2017

Cause of Action Institute to Defend D-Link Systems Against FTC’s Baseless Data Security Charges

Washington, D.C. – Jan. 10, 2017 – Cause of Action Institute (“CoA Institute”) today announced it will represent D-Link Systems, Inc. (“D-Link Systems”) in its defense against recent unwarranted and baseless charges brought by the Federal Trade Commission (“FTC”) regarding the company’s security practices for consumer routers and IP cameras.

“It sets a dangerous precedent for the federal government to go after a good company and put American jobs at risk without a single instance of actual or likely consumer harm,” said Cause of Action Institute Assistant Vice President Patrick Massari. “This lawsuit is another instance of the FTC’s unchecked regulatory overreach. If the FTC can bring a lawsuit on the mere potential of a data security breach, nearly every company will be subject to unconstrained and unexplored data security liability.  Such limitless liability coupled with FTC’s history of unrelentingly litigious oversight will no doubt have a chilling effect on innovation in the Internet of Things. Privacy advocates and consumers at large should applaud our client’s courage for fighting these incendiary claims and refusing to be held hostage by the FTC for the next 20 years.”

D-Link Systems has retained CoA Institute due to its successful track record fighting government abuse. CoA Institute relentlessly defended LabMD, a small cancer diagnostics company, against a similar unwarranted FTC overreach into data security oversight.

“We are pleased Cause of Action Institute will be joining our fight against these false allegations,” said William Brown, chief information security officer, D-Link Systems, Inc. “We are committed to protecting customer security, which the complaint affirmed by citing no actual data breach. Global connectivity relies on an unfettered commitment to security; we will continue to maintain and enhance the integrity of all D-Link Systems products.”

About Cause of Action Institute
Cause of Action Institute is a 501(c)(3) non-profit working to enhance individual and economic liberty by limiting the power of the administrative state to make decisions that are contrary to freedom and prosperity by advocating for a transparent and accountable government free from abuse.

About D-Link Systems, Inc.
D-Link Systems is a global leader in connectivity for home, small business, mid- to large-sized enterprise environments, and service providers.

For information regarding this press release, please contact Zachary Kurz, Director of Communications at CoA Institute: zachary.kurz@causeofaction.org

Press Release, Media Learn More