Welcome to our fortnightly newsletter, where our reporters Kruttika Lokesh and Dhananjay Dhonchak put together handpicked stories from the world of tech law! You can find other issues here, and you can subscribe to Metadata by TLF here.
SC moves to dismiss PIL implicating Jio’s liability in RCom’s AGR dues
Jio was recently made a party in a matter regarding adjusted gross revenue (AGR case) between companies in India and the Department of the Telecommunications and other telecom companies in India. The issue was regarding investigation into whether telcos like RCom, Videocon and Aircel wanted to evade paying their dues to the DoT by filing for insolvency. The DoT had decided that Jio was to be made liable for the 31000 crore AGR dues that RCom owed to the Department, since Jio was using RCom’s airwaves as evidenced by a 2016 spectrum sharing agreement. Jio sought to prove that the spectrum was simply leased and that they didn’t have any exclusive use of the spectrum. They further argued that spectrum sharing agreements do not assume a sharing of liabilities for DoT’s AGR dues.
Ishita Guha & Japnam Bindra, “There's no legal basis for transferring AGR dues of RCom: Jio tells SC”, LiveMint (17 August, 2020).
Sanya Talwar, “[AGR Case] SC Seeks Centre's Response On Whether Reliance Jio Should Pay R-Com's Dues” LiveLaw, (17 August, 2020).
Special Correspondent, “Trai issues spectrum usage charges sop” Telegraph India, (18 August, 2020).
ANI, “SC dismisses plea to direct authorities to immediately recover AGR dues from telcos”, ET Telecom (17 August, 2020).
US Court orders Uber and Lyft to classify drivers as employees
The U.S. 9th Circuit Court of Appeals in a preliminary injunction has ordered Uber and Lyft to reclassify its drivers as employees rather than independent contractors. The decision will entitle drivers to protections that are given to full-time employees. The injunction comes in response to a May lawsuit filed by the state of California against the companies which alleged that the companies were misclassifying their drivers under the state’s new labour law Assembly Bill 5 (AB5) law. The policy as per AB5 sets out a three-pronged test to determine if a worker should be classified as an independent contractor or an employee and is based on whether or not the worker is free from the control of the company. Both Uber and Lyft have expressed their intention to appeal this decision.
Dan Hardman, “California Judge Orders Uber And Lyft To Reclassify Drivers As Employees”, JD Supra (August 14, 2020).
Dara Khosrowshahi, “I Am the C.E.O. of Uber. Gig Workers Deserve Better.”, New York Times (August 10, 2020).
Anthony Zaller, “Understanding the ABC test for independent contractors in California”, California Employment Law Report (March 29, 2019).
Andrew J Hawkins, “California labor commissioner sues Uber and Lyft for alleged wage theft”, The Verge (August 5, 2020).
Therese Poletti, “Uber and Lyft’s ‘day of reckoning’ is finally here”, Market Watch (August 13, 2020).
Lagos Government tries balancing act through new e-hailing guidelines
For a country that has banned commercial motorcycles, the state of Lagos was placed in a unique and novel situation when they decided to regulate companies like Uber and Bolt that wanted to set up business operations in Lagos. It was claimed by the Lagos government that the e-hailing companies were involved in a participatory capacity while the policy for the taxi sector was being discussed, however this was not substantiated by either Uber or Bolt. The position in the draft guidelines required each vehicle to pay a license fee, which obstructs Uber and Bolt since most of their drivers worked with them only for ancillary income and had full-time jobs otherwise. The Lagos government subsequently modified this clause by instituting an operator license fee instead.
Olumuyiwa Olowogboyega, “A deep dive into the proposed guidelines for e-hailing companies in Lagos”, Tech Cabal, (11 August, 2020).
Staff, “8 things to know about the Lagos e-hailing ride guidelines”, Vanguard, (15 August, 2020).
Anibe Idajili, “Lagos State Amicably Resolves Issues Around the Proposed Guidelines for e-hailing Taxi Services”, Tech City, (15 August, 2020).
Jennifer Atkinson, “Ultimate Guide To Launch e-Hailing App For Your Local Region”, Your Story, (9 July, 2019).
Will Herzog, “Ride-Hailing vs. Ride-Sharing: The Key Difference and Why It Matters”, Ecolane, (18 October, 2018).
Fortnite maker Epic Games sues Apple and Google
Fortnite was banned from the Google Play Store and Apple’s App Store after it tried to push an update which would have bypassed Apple’s and Google’s payment systems. The update in question allowed gamers to avail a 20% discount on in-app purchases if they paid Epic Games directly rather than using Apple or Google’s payment systems. Epic Games claims that the compulsory 30% cut taken by Google and Apple on any in game purchases is anti-competitive and restrictive. The claims are more difficult to prove against Google as it allows game developers to distribute apps through multiple app stores and even through direct links. Google has claimed that the Android system provides developers with a voluntary choice of whether or not they want to use the Play Store. Apple has claimed that Epic Games voluntarily made a choice to host its app on the App Store and making any special arrangement for Fortnite would lead to an uneven playing field for all developers.
Nick Statt, “Epic Games is suing Apple”, The Verge (August 13, 2020).
Russel Brandon, “Epic is suing Google over Fortnite’s removal from the Google Play Store”, The Verge (August 13, 2020).
Cecilia D’ Anastasio, “Epic Games' Lawsuits Fire a Shot at Apple and Google's App Store 'Monopolies'”, Wired (August 13, 2020).
Will Oremus, “Apple’s Secret Monopoly” OneZero, (February 25, 2020).
Australia to regulate tech giants in a bid to save news agencies
Facebook and Google are advocating against new Australian laws that requires the tech giants to pay news media for the content that is available on their platforms. Not only is compliance with this requirement going to cost the intermediaries dearly, non-compliant behaviour leads to heavy fines which is intended to ensure transparency regarding how the algorithms rank content. Google attached an open letter in which the company admitted that it would have to leak user data to news companies so that they may increase their ranking artificially on the search engine. It was mentioned that they partner with Australian news companies and compensates them in addition to driving traffic towards news websites. This move from the Australian government comes because of the many news agencies that have shut down during this pandemic, a situation exacerbated by companies like Google and Facebook that rely heavily on advertising revenue.
Agence France-Presse, “Google slams Australia law forcing tech giants to pay for news”, Manila Bulletin (17 August, 2020).
Staff, “Google says Australian law would put search and YouTube at risk”, BBC News (17 August, 2020).
Amanda Meade, “Google urges YouTubers around the world to swamp Australian regulator with complaints”, The Guardian (18 August, 2020).
Derek Thompson, “The Facebook Effect on the News”, The Atlantic (12 February, 2014).
Qualcomm wins appeal in antitrust case
Qualcomm Inc. has successfully appealed a 2019 judgement which had ruled that the company was charging phone makers “unreasonably high” licensing fees and thereby restricting competition. The ruling had required Qualcomm to renegotiate its current license agreements and refrain from anti-competitive licensing practices in the future, citing the company’s of not extending licenses to rival chip manufactures as an example of its anti-competitive behaviour. However, the appellate court while dismissing this argument said that a business is under no duty to do business under the terms and conditions preferred by its rivals. It also held that Qualcomm was under no antitrust duty to license rival chip manufacturers. The court also warned against applying antitrust laws to disputes that were essentially contractual in nature.
Richard G. Gervase, Miller, Renaud, Song, “Ninth Circuit Reverses FTC Win in FTC v. Qualcomm, Finding No Antitrust Violations from Qualcomm’s Licensing of its Standard-Essential Patents”, The National Law Review (August 13, 2020).
John O. McGinnis and Linda Sun, “Justice-FTC Antitrust Feud Is the Wrong Kind of Competition”, Washington Post (August 13, 2020).
Sean Hollister, “Qualcomm handed a huge win as US court overturns the ‘no-license, no-chips’ antitrust ruling”, The Verge (August 11, 2020).
Multiple Authors, “FTC v. Qualcomm Blog Series”, Truth on the Market (January 22, 2019 – January 22, 2020).