Confirmed: Deloitte Cooperated with the DOJ on HPE Autonomy Case

April 22, 2021

The ghost of Arthur Andersen appeared I think.

Now we know why HPE (formerly HP) stopped making noise about suing auditing firm Deloitte for its role in the decision to buy Autonomy in 2011, which HPE famously came to regret. Forced to write down Autonomy’s value by $8.8 billion in 2012, HPE claimed the software firm and auditors at Deloitte had misrepresented its value. There were questions of whether HPE did its own due diligence before making its purchase, but the firm proceeded to take those it blamed to court. Autonomy’s CFO Sushovan Hussain was sentenced to five years in jail in 2019, and the case against CEO Mike Lynch is (oh so slowly) proceeding. Now The Register reveals, “Deloitte Settled HPE’s Autonomy Lawsuit for $45m Back in 2016 and Agreed to Cooperate with US DOJ.” Writer Gareth Corfield tells us:

“The amount of the settlement is less than 1 per cent of the $5bn for which HPE is pursuing Lynch and Hussain. Although HPE and Deloitte signed a confidentiality agreement over the $45m, its main details were hiding in plain sight inside the last ever accounts filed by Autonomy Corporation Ltd (ACL) before it was merged away into HPE’s corporate structure, becoming known as ACL Netherlands BV. A letter previously sent by HPE’s lawyers to Deloitte in 2014 alleged ‘there is evidence that Deloitte was complicit in aspects of the misstatements in Autonomy’s published information’. That allegation would never be tested in court, though Britain’s accounting regulator eventually found it proven. Public knowledge of the settlement sum also sheds light on why Deloitte was never a co-defendant with Lynch and Hussain in the High Court, despite the auditor being an obvious target for HPE following allegations of false accounting at Autonomy.”

When HPE filed its suit against Lynch and Hussain in 2015, it left open the option to include Deloitte but mysteriously withdrew that potential the next year. Now Corfield confirms that, as suspected, those at Deloitte who had worked on the account signed an agreement to cooperate with the Department of Justice. It specified that Deloitte admitted no wrongdoing or liability, and the firm granted HPE’s lawyers complete access to its Autonomy audit papers and emails. It is suspected that the court would have ruled against Deloitte had it not cooperated, and that by doing so the firm avoided damage to its reputation. Perhaps. But consider—whom do you want as your tax advisor?

Cynthia Murrell, April 22, 2021

Daily Mail, Google, Class, Power, and Incentives

April 20, 2021

The estimable Daily Mail is a newspaper. The owner of the Daily Mail is the Daily Mail and General Trust plc. The big dog at the outfit is The Fourth Viscount Rothermere. Titles are important in England. Crickets the game. “Plumby tones” was crafted to describe the accents some Americans long to have. Dim lights, dark rooms, and hushed tones are also important.

Now the Viscount’s minions are demonstrating that none of their scion are likely to be tagged “googley.” According to the equally estimable Wall Street Journal, the “Daily Mail Owner Files Antitrust Suit Against Google, Citing Royals Coverage.” Gentle reader, you will have to pay Mr. Murdoch to read this interesting story which is completely unbiased and presents the idea that the Google is abusing the Viscount’s ad sales unit.

The core of the story is that Google suppresses Daily Mail content because the Daily Mail is not selling enough Google ads. More popups are needed! The reason is not that those stories are not Savile Row grade stories. The cause of this discrimination of the caste-centric Google and the caste-centric Viscount is quotas.

From my vantage point in Harrod’s Creek, the antics of two outfits, obsessed with power and getting their way, are jousting over advertising consumed by those not in the rosy glow of the upper crusts.

The irony of the Google caste system (represented by Pichai Sundararajan) and the Fourth Viscount Rothermere is delicious. Didn’t India once view Britain as a glowing source of guidance?

I have no doubt that this dust up is about money, but it is also about power. Google has power right now. The Viscount remembers the power it once had. America! The colonies.

How will this unfold? No chirping merry in this dispute.

Stephen E Arnold, April 20, 2021

Google and the Annoying Australian Government

April 16, 2021

I noted “Australian Judge Rules Google Misled Android Users on Data.” The write up reports:

Google broke Australian law by misleading users about personal location data collected through Android mobile devices…

In the big world of the Google does this decision matter?

Chair of the Australian Competition Commission finds the decision important for Australia. The news story states:

This is an important victory for consumers, especially anyone concerned about their privacy online, as the court’s decision sends a strong message to Google and others that big businesses must not mislead their customers. We are extremely pleased with the outcome in this world-first case.

Like Facebook, Google finds that Australia is having difficulties accepting the systems and methods of the digital nation states. One risk to the GOOG may be that other mere countries emulate the ways of the Aussies. Imagine the chaos if the EC downs three or four Foster’s and screams, “Let’s put Googzilla on the barbie.”

Even Google’s legions of attorneys might balk at a trip to Brussels or Strasbourg as the Australian emulation attracts attention.

Stephen E Arnold, April 16, 2021

Justice Thomas, Social Media, and Big Tech

April 15, 2021

Are social-media platforms more akin to telephone carriers or to conference halls? SCOTUS Justice Clarence Thomas likens them to the former, we learn from “Justice Thomas Argues for Making Facebook, Twitter and Google Utilities” at Protocol. On the other hand, TechDirt makes a solid, though snarky, argument that social-media companies are more like venues that rent out conference space in, “Justice Thomas Goes Weird Again; Suggests Twitter Can’t Moderate & Section 230 Violates 1st Amendment.”

On April 5th, the Supreme Court vacated a lower court decision which had ruled President Trump could not block Twitter followers, saying the issue is moot now that 45 is out of office. The lower court’s decision rests on the idea that a government official’s post and any discission around it constitute a public forum. As such, the official may not block comments with which they disagree. Justice Thomas took the occasion to muse upon the nature of social media platforms. Protocol reporter Issie Lapowsky writes:

“Thomas argues that some digital platforms are ‘sufficiently akin’ to common carriers like telephone companies. … Thomas argues that while private companies aren’t subject to the First Amendment, common carriers are unique to other private businesses in that they do not have the ‘right to exclude.’ Thomas suggests that large tech platforms with substantial market power should be bound by the same restrictions.”

Such restrictions would make it very hard for platforms to do anything about fake news, hate speech, and other objectionable content. TechDirt’s Mike Masnick, however, describes why Justice Thomas’s perspective is flawed. He writes:

“A bunch of very confused and clueless people have (incorrectly) taken to arguing that this somehow means that Twitter itself is a ‘public forum’ and cannot moderate content. That has always been very, very wrong. The courts were clear that they were only talking about the space beneath a public official’s statements. The simplest way to think of it is this: If the government rents out an event hall to let the President give a speech, it cannot engage in viewpoint discrimination in blocking people from coming into the hall to hear the speech. That does not mean the event hall itself is now permanently a public forum, or that the event hall owners cannot block people they have banned from their property from attending the speech, or any other events.”

Justice Thomas also hinted that Section 230 may be unconstitutional, a viewpoint Masnick insists demonstrates a misunderstanding of the law. See the TechDirt piece for more of Masnick’s strong opinions and reasoning on the subject.

Will Big Tech be able to influence Justice Thomas’ view? Maybe.

Cynthia Murrell, April 15, 2021

Section 230: Just Flip the Regulation of Big Tech Around

March 30, 2021

I read “No One Agrees on How to Fix Big Tech.” The main point seems to be embodied in this quote from the article attributed to an elected US official:

The time for self-regulation is over. It’s time we legislate to hold you accountable.

Let’s look at the need for regulation in a different way.

Big tech is more democratic than some other systems. Big tech’s users are voting on its value, viability, and virtue with each click. Elected officials and the historical laws are essentially out of step with what people want.

The write up asserts:

You could suggest that each company’s statement on s230 is a reflection of their general values and attitude. Facebook wants to tweak the law to potentially weaken competitors, Google is hoping not to make waves, but won’t shout for the status quo too loudly, while Twitter is already mentally elsewhere. Unfortunately for Zuckerberg, Pichai and Dorsey, none of those positions are likely to sate politicians who understand that something needs to change, but aren’t sure what.

Another view is that big tech is a manifestation of the “new” democracy. The organizations are nation states, have support, and operate above the no longer meaningful laws of historical artifices.

It is increasingly clear that it is a thumbtyping world. Self regulation is not needed when the constituents vote to keep big tech in office.

Stephen E Arnold, March 30, 2021

The Google: Accused of Going Slow

March 25, 2021

I love the automated emails which inform me that one of my WordPress posts has violated Google AMP requirements. We use an automated system to post. We don’t make changes on the fly to our posts. Yet Google wants us to stop everything and fix an AMP issue. The only problem is that we did not create the AMP issue, and the GOOG does not bother to explain what the issue is. We are, however, are supposed to hop to it.

However, those expectations of snappy reaction to order from authorities do not apply to the Google. (Does that surprise you?)

U.S. DOJ Accuses Google of Dragging Its Feet in Antitrust Trial” makes it clear that there is Google’s definition of “snappy” and the US legal system’s definition. The write up reports:

…the Justice Department said that Alphabet’s Google had balked at some search terms that the government wanted it to use to locate relevant documents.

Google is quoted as telling US legal authorities:

“The DOJ Plaintiffs’ proposal is unreasonable and not proportional to the needs of this case,” Google said in the filing.

Beyond Search thinks that it understands the Google’s position; to wit:

  • Google has more money and lawyers and time than the US Department of Justice.
  • Google has a wealth of delaying tactics to use; for example, the firm can explain that it cannot locate documents. This worked when Google was asked to provide salary data which the mom and pop ad shop could not gin up. Imagine that.
  • Churn among lawyers in the US Department of Justice is a constant. Perhaps the idea is, “Let’s wait and see if more friendly lawyers get assigned to the case.”

Logical, right? That’s why I have to react immediately to an AMP message caused by Google’s onw system. Absolutely.

Stephen E Arnold, March 26, 2021

Fruit of Tainted Tree: An Interesting Metaphor and a Challenge for Data Removal Methods

March 22, 2021

I am not legal eagle. In fact, legal eagles frighten me. I clutch my billfold, grab my sweater, and trundle away as fast as my 77 year old legs permit. I do read legal info which seems interesting. “FTC Says That One Cannot Retain the Fruit of the Tainted Tree.” That’s a flashy metaphor for lawyers, but the “tainted” thing is intriguing. If an apple is stolen and that apple is poisoned, what happens if someone makes apple sauce, serves it to the PTA, and a pride of parents die? Tainted, right?

The write up explains:

the FTC has found that the work product of ill-gotten data is no longer retainable by the developer.

Okay, let’s say a developer creates an application or service and uses information available on a public Web site. But those data were uploaded by a bad actor and made available as an act of spite. Then the intrepid developer recycles those data and the original owner of the data cries, “Foul.”

The developer now has to remove those data. But how does one remove what may be individual datum from a data storage system and a dynamic distributed, modern software component.

Deletions are not really removals. The deletion leaves the data, just makes it unfindable in the index. To remove an item of information, more computational work is required. Faced with many deletions, short cuts are needed. Explaining what deletions are and aren’t in a modern distributed system can be an interesting exercise.

Now back to the tainted tree. If the ruling sticks, exactly what data will have to be removed. Is a single datum a fruit. Years ago, Dun & Bradstreet learned that some of its data, collected then by actual humans talking to contacts in financial institutions or in gyms, could not be the property of the outstanding data aggregation company. A phone number is or used to be a matter of fact. Facts were not something an outfit could own unless they were organized in a work and even then I never understood exactly what the rules were. When I worked in the commercial database business, we tried to enter into agreements with sources. Tedious, yes, but we had a deal and were not los banditos.

Some questions crossed my mind:

  1. How exactly will tainted fruit (apples, baskets of apples, or the aforementioned apple sauce) be removed? How long will a vendor have to remove data? (The Google right to be forgotten method seems sluggish, but that’s just my perception of time, not the GOOG’s or the EC regulators’.)
  2. How will one determine if data have been removed? There are back up tapes and sys admins who can examine data tables with a hex editor to locate certain items of information.
  3. What is the legal exposure of a person who uses tainted fruit which is identified as tainted after reuse? What if the delay is in lawyer time; for example, a year or more later?
  4. What happens when outfits use allegedly public domain images to train an AI and an image is not really public domain? Does the AI system have to be dumped? (I am thinking about Facebook’s push into image recognition.)

Worth watching if this write up is spot on and how the legal eagles circle this “opportunity” for litigation.

Stephen E Arnold, March 22, 2021

Google Road Kill: Legal Eagles Circle Data Incognita

March 17, 2021

I read “Google Must Face Suit over Snooping on Incognito Browsing.” Google created the “incognito” mode to give users of Chrome a way to browse privately. The write up states:

Google failed to kill a lawsuit alleging that it secretly scoops up troves of internet data even if users browse in “Incognito” mode to keep their search activity private.

What happens when marketing to stimulate more useful clicks collides with the reality of constant data collection?

This type of legal position it seems:

“The court concludes that Google did not notify users that Google engages in the alleged data collection while the user is in private browsing mode,” U.S. District Judge Lucy Koh in San Jose, California, wrote in her ruling.

Google, according to the article, took this position:

Incognito mode in Chrome gives you the choice to browse the internet without your activity being saved to your browser or device. As we clearly state each time you open a new incognito tab, websites might be able to collect information about your browsing activity during your session.

But Google users have to agree to Google policies. These policies seems to give the friendly, mom and pop online ad company license to capture user information. Incognito, logically, does not mean invisible. Ergo, user activity is, logically, visible.

If you are Googley, you will understand the line of reasoning.

Several observations:

  1. The explanation is rhetorically similar to the Gibru-gibberish output with regard to a former Googler’s research paper about “ethics”
  2. The use of incognito mode provides a useful item of metadata which may of use to some analytic routines used by the mom and pop online ad company, its partners, and its developers
  3. The involvement of the courts is part of the mom and pop, online ad company’s strategy of do, deflect, and delay via marketing and legal activities.

The hitch in the git along is that users and regulators are starting to look at the mom and pop online ad agency as a less friendly entity today than it was in the years after the company’s initial public offering.

This perception shift is incorrect. Google has been consistent in its game plan, methods, and embrace of do, deflect, and delay.

What worked in the past, however, seems to be manifesting stress fractures; for example, the interesting criticism of Microsoft and the giving in to a mere country like Australia for news content.

Litigation is expensive, and Google has the motivation and the means to wear down opponents in costly, time consuming, and complex legal engagements. Not every Google opponent has the grit of Oracle to joust about Java. In the absence of meaningful regulation, Google’s logic is likely to keep those legal eagles circling in the hopes of digital road kill upon which to fatten themselves.

Stephen E Arnold, March 17, 2021

Russia: Taking Big Tech to Court and Maybe Penal Colony No. 2

March 16, 2021

Vladimir Putin’s power is considerable. There are the government entities and the informal entities. Both can be used to interesting effect. “Russia Sues Google, Twitter, Facebook for Not Helping to Suppress Anti-Putin Protests” explains:

Russian authorities have filed lawsuits against five of the world’s biggest social-media platforms for allegedly refusing to pull down users’ posts that urged people to join nationwide anti-Putin protests earlier this year.

What firms are in the Russian legal systems’ smart targeting system? Superstars include Twitter, Google, Facebook, TikTok, and Telegram. Telegram allegedly worked a deal with regard to encrypted messages, but that may be put aside. Some at Telegram may have family in Russia, and these individuals — if they are in the rodina — may have some interesting opportunities to meet Russian officials soon. Facebook, Google, and Twitter may ignore the legal annoyances. These firms have to worry about other issues. Google has to deal with some staffing issues. Facebook is busy explaining that it is not a monopoly to US legal eagles. And, Twitter? Yes, a PR blitz, new services, and suddenly astir digital guru. That’s an interesting problem for some. TikTok is Chinese. And with China and Russia becoming pals and planning a holiday near the moon, TikTok may just be redirected using bureaucratic tools employed to fix up Hong Kong elections.

Alleged image of a “typical” Russian Penal Colony No. 2.

image

The companies each have three cases against them, according to the news agency, with each case punishable by a fine of up to 4 million rubles, or around $54,000.

If found guilty, I would suggest that employees of these firms put off their vacation in Sochi. If slammed into Penal Colony No. 2, the executives of the offending firms would have a chance to meet some interesting people. Tattoos to commemorate the user experience are available as well. Internet service is spotty from what I have heard.

Stephen E Arnold, March 16, 2021

Cyprus: Illuminating Some Interesting Organizations

March 10, 2021

Cyprus, a fine island, can be baffling to first time visitors. Some of the confusion may be reduced if the information in “Cyprus to Life Veil of Secrecy with Register of Company Owners.” Some firms in the specialized services game have offices in Nicosia. Some are housed in what look like fancy villas or zippy apartment buildings. The listing of company owners is not available, but allegedly the list will become available in the  near future. Why is this a big deal? Some bad actors use Cyprus as a headquarters and financial resource center. Why not part a super yacht and take care of business in above average anonymity. The list may be called the “Ultimate Beneficial Owner” register. Among the individuals concerned about this new sunlight are quite interesting individuals allied with certain powerful Eastern European leaders and “organizations.” Who is in charge of this project? Cyprus’s Ministry of Energy, Commerce, and Industry. Will that individual exercise some additional caution? We will know and maybe get a chance to learn about the UBO people. Maybe.

Stephen E Arnold, March 11, 2021

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