Lu La Roe to settle pyramid scheme lawsuit for USD 4.75 million, Supreme Court issues notices to online platforms in UPI Data Privacy Case, No violation of privacy Minister of State informs Rajya Sabha, Data Privacy can take the form of non-price competition, ByteDance sues Tencent for Anti-Competitive behaviour, Qualcomm loses case against EU Anti-Trust Regulators, Facebook prepares to file Anti-trust Lawsuit against Apple and EU Anti-trust regulators investigate Mondelez International.
Lu La Roe to settle pyramid scheme lawsuit for USD 4.75 million
The multi-level marketing company will be paying USD4.75 million in order to settle a lawsuit filed by the State of Washington against it and several of its executives for violating the Anti-Pyramid Promotional Scheme Act, as well as Washington’s Consumer Protection Act. The company rose to fame through its large network of commission-based consultants who mostly consisted of stay-at-home mothers. The complaint alleged that the company made deceptive claims about the nature of its business model and profitability to encourage people to join in as consultants and failed to honour its refund policies.
Supreme Court issues notices to online platforms in UPI Data Privacy Case
The Supreme Court has sought a response from big tech companies in relation to a PIL filed that sought directions from the RBI and the National Payments Corporation of India to ensure the data privacy of users of third-party payment and e-wallet apps. The PIL contended that both authorities have permitted participation and use of UPI services without much scrutiny.
No violation of privacy Minister of State informs Rajya Sabha
The Minister of State for Health Ashwini Choubey has informed the Rajya Sabha that there is no privacy violation under the National Digital Health Mission (NDHM) as the health data collected is stored in a federated architecture as formulated under the National Digital Health Blueprint. The NDHM enables appropriate use of health data only with the consent of the individual and is in compliance with all relevant laws, rules and decisions of the Supreme Court he argued. The blueprint envisions the use of a secure cloud infrastructure that will be constantly monitored to ensure the highest security. Pilot phases of the mission is already underway in some places with over 6 million health IDs generated as of the 21st of January, 2021.
Data Privacy can take the form of non-price competition
In a report, the Competition Commission of India noted that data privacy may take the form of non-price competition and that abuse of dominance can lower privacy protection. Lowering of these standards would imply lack of consumer welfare. Other non-price factors of competition affecting consumer preference included network coverage, customer service, tariff package and lower tariffs.
ByteDance sues Tencent for Anti-Competitive behaviour
Byte Dance files an anti-trust violation suit against Tencent Holdings for blocking access to the users of its instant messaging apps such as WeChat and QQ from Byte Dance’s Douyin (which is a Chinese version of the TikTok app). Byte Dance alleges that Tencent is engaging in anti-competitive practices through its monopolistic behaviour and seeks compensation worth 90 million Yuan. Tencent stated that they have not received any material regarding the lawsuit and vowed to file a countersuit and responded to ByteDance’s allegations calling them ‘untrue’ and amounting to ‘malicious slander’. Tencent further alleged that many Byte Dance developed products have illegally obtained WeChat users’ personal data to which Douyin responded that this was false and that user data cannot be Tencent’s private property.
This also comes in light of the new draft regulations issued by China’s State Administration for Market Regulation (SAMR) to curb anti-competitive practices among tech platforms. Tencent’s recent merger is under the radar of authorities. In December, Tencent had to pay 5,00,000 Yuan for not reporting past deals for anti-trust review. Chinese regulators have decided it was time to crack the whip since for a long time the tech sector has been given freedom and state support and wasn’t required to take permission from competitive authorities until recently.
Qualcomm loses case against EU Anti-Trust Regulators
Qualcomm, a company that deals with the creation of semi-conductors, software and services related to wireless technology, was asked by EU anti-trust regulators to provide more information about its business practices, in order to assess whether there was an abuse of its dominant position in the market. Qualcomm appealed for the request to be rejected reasoning that the collection of data required would be an extremely costly affair because of the time, money and resources involved. Qualcomm’s appeal was rejected by the General Court and by the EU Intermediate Court in 2019.
While Qualcomm alleged that this request exceeded investigator’s scope, the CJEU- Europe’s highest court re-affirmed the regulator’s right to investigate, stating that the commission has broad powers provided under Regulation No.1/2003 to decide whether a particular piece of information was necessary to determine infringement of competition law thus rejecting Qualcomm’s appeal.
Facebook prepares to file Anti-trust Lawsuit against Apple
Facebook is planning to file an anti-trust lawsuit alleging that the developers are forced to follow Apple’s App Store rules, which Apple’s own apps are not obliged to follow. It also alleges that by not allowing third party apps to be the default app, Apple has engaged in anti-competitive behaviour.
While the complaint has not been filed yet, this step comes in light of Apple’s plan to launch the ATT-App Tracking Transparency feature, which seeks to let users know the apps that are tracking them. Apple further maintains that it does not share user data with third parties, thereby protecting the privacy of users. If users opt-in for personalized ads, then Apple would group users with similar characteristics so that the ad campaign cannot identify a single user. Apple has further accused Facebook for using data about browsing activity to target ads and allow detailed profiling without consent thereby ignoring the user’s privacy. Facebook has alleged that this amounts to abusing its dominant position and stifling competition.
EU Anti-trust regulators investigate Mondelez International
The European Commission has formally opened an investigation against Mondelez International which is a key producer of chocolates, biscuits and coffee in the market. The Commissioner has stated that there are concerns on whether Mondelez has restricted cross border trade between EU Member states through agreements and unilateral practices.
The Commission will look into whether prices have been raised or if firms have been paid so that they would not engage in parallel trade. This investigation will help determine whether free competition has been restricted by engaging in practices that hinder trade flows, ultimately increasing prices for the consumers. Mondelez has responded stating that it will ‘constructively work with the commission’
Authored and compiled by Neharika Vhatkar (Associate, BananaIP Counsels), Lian Joseph (Legal Intern) and Shefali Girish (Legal Intern)
The IP, Privacy and Antitrust Law News Bulletin is brought to you by the Consulting/Strategy Division of BananaIP Counsels, a Top IP Firm in India. If you have any questions, or need any clarifications, please write to [email protected] with the subject: IP, Privacy and Antitrust Law News.
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