Hello What’s Next readers! This week, you’re in for a bit of a dive into the world of computer code — no programming experience required. Speaking of tech, the big to-do this week is Apple’s WorldWide Developers Conference, which was big on software and digs at Facebook. But hardware? Just new iPhone cases (plus some watch bands), reports The Verge. I’m partial to the orange.
Watch This Space: The Future Is Open Source
In the world of code, the buzz on the internets over the past few days has been all about Microsoft’s acquisition of GitHub — the largest software development platform on the planet. From the outside, it might not seem like such a surprising deal. Giant software company swallows smaller-sized software company, right? Not so fast. This is practically a tectonic shift in the software industry, albeit one that has been underway for some time. Microsoft — a behemoth long associated with high price tags and proprietary workplace fixtures like Word — is planting its flag firmly in open source software development with a $7.5 billion deal. So if you’re a lawyer serving the tech industry who’s been thinking open source is just some backwater for Linux nerds, time to start paying attention.
For the uninitiated, GitHub is a cloud-based tool that allows software developers the world over to collaborate on projects and building new tools. Many of the code “repositories” hosted on GitHub are public and open source, with varied licensing structures; users can “fork” — or make an offshoot version of — many existing software projects literally with the click of a single button. Although there are alternative tools, like GitLab and Atlassian’s BitBucket, GitHub is ubiquitous. (“Git,” in case you were wondering, is a related tool for tracking different versions of software code along its development lifecycle.) The platform is like the Wild West of code, a place where anyone can join and almost anyone can contribute.
In other words, it’s not exactly what you think of when you think of Microsoft. But this is not your Microsoft of the 1990s. The company joined the Linux Foundation — long regarded as Microsoft’s open-source archnemesis — in 2016, as part of a cultural and strategic business shift under CEO Satya Nadella. And it also experimented with an open source development platform of its own called CodePlex before throwing in the towel last year. New GitHub CEO Nat Friedman, who comes from Microsoft, wrote in an opening note to the site’s users about his love of Linux and open source from a young age.
Now, for Microsoft, the acquisition might also be more of a long-term play on cloud services in general; Azure is a big part of its business already, and “Platform as a Service” is a trendy phrase in software these days. But this is also a clear-as-day sign that open source is now firmly a part of big tech business. For lawyers serving this industry, being savvy about that will surely help. Having some knowledge of open source licensing structures— like the GPL (versions 2 and 3), Apache, and MIT licenses — might be useful. If there is one thing that could change about GitHub, it may be that its laissez-faire attitude toward hosted project licensing could start to change. This is still Microsoft, after all; it likes things a tad buttoned up.
>> Think Ahead: There’s plenty of skeptical software engineers out there about this deal, but either way, it is a game changer. If you were looking for an opportunity to get schooled on open source and its unique legal environment, this is as good a time as any.
>> Who Got the Work: Simpson Thacher & Bartlett advised Microsoft on the acquisition, while Fenwick & West advised GitHub, the firms said in press releases. Orrick, Herrington & Sutcliffe also advised Microsoft on the antitrust elements of the deal
Spotify and the Perils of Content Moderation
You’ve probably heard about the #MuteRKelly campaign on social media, which follows a long string of allegations that the musician sexually assaulted a number of women. The streaming music platform Spotify took the movement’s directive literally, removing the RnB artist from playlists and algorithms that would serve up his music. More recently, it abruptly reversed course, saying it doesn’t “aim to play judge and jury.” As my colleague Caroline Spiezio reports, legal experts say it was probably a smart move by the Stockholm-based company.
“Even if you think Spotify should be making content moderation decisions based on artists’ off-platform conduct, it’s pretty clear that they lack in-house competence and capacity to make fair judgments about that conduct,” said Annemarie Bridy, professor of law and affiliate scholar at the Stanford University Center for Internet and Society.
Eric Goldman, a professor at Santa Clara University School of Law and director of the school’s High Tech Law Institute, told Caroline that a clear policy saying that artists facing sexual abuse allegations will be removed from the music platform would be a more transparent approach. But Goldman also said that could’ve also landed Spotify in legal trouble.
“The most obvious legal risk is if Spotify [is seen as] falsely accusing someone of committing sexual abuse, if they were to issue a statement that they blocked an artist because of sexual abuse allegations and it turns out that all of that is wrong, then Spotify is on the hook,” he said.
>> Takeaway: Content moderation is a difficult, dicey business. As Bridy notes, companies walk a fine line between pleasing advertisers who don’t want to be associated with artists facing allegations and record companies backing such artists, as well as users on both sides.
Protocol: Ripple’s Big Guns, and All Hail the Crypto Czar!
Ross Todd of The Recorder sums it up best: “There’s lawyering up and then there’s this.” After getting hit with an investor class action alleging that the cryptocurrency XRP is actually an unregistered security, San Francisco’s Ripple Labs has hired former Securities and Exchange Commission chair Mary Jo White and her enforcement chief Andrew Ceresney for its defense.
The two attorneys, now at Debevoise & Plimpton, appeared on the docket in San Francisco federal court in a motion to remove the suit from California state court. Also appearing for Ripple were lawyers from Skadden, Arps, Slate, Meagher & Flom. I had been wondering how seriously Ripple would take this suit; I guess I have my answer.
A spokeswoman for Ripple said that the company is “ready to fight this opportunistic suit in the appropriate federal court.” She declined to say, however, whether the company is also having discussions with the SEC.
Meanwhile, the SEC on Monday announced that it was creating a new role within the Division of Corporate Finance — colloquially known as “CorpFin” — to coordinate all of its enforcement efforts on cryptocurrency and digital tokens. Valerie Szczepanik, who’s been with the agency since 1997, was named “Associate Director of the Division of Corporation Finance and Senior Advisor for Digital Assets and Innovation.” If that’s a mouthful, just say “Crypto Czar.”
Keeping Social: WA Pushes Transparency Law
You might know Washington State Attorney General Bob Ferguson for suing the Trump Administration over the travel ban. Now, his office is going after Facebook and Google for allegedly violating a state law that requires transparency in campaign advertising, reports The Seattle Times.
“In the same way everyone else has to play by our rules, so too do Google and Facebook. In our view the law is pretty clear on this point,” Ferguson told the paper. “I understand this is a hassle for them, but I think the voters of our state have made it clear they expect transparency in this area.”
The Times explains that Washington state requires companies to keep records about who is paying for online political ads on their platforms, and make those records available upon request. But Google and Facebook say they aren’t able to turn over all of the required information, according to the lawsuit filed in King County Superior Court.
In a world when more ad dollars are being spent online, as opposed to traditional TV and radio, that leaves a transparency gap. “The state’s lawsuit says political committees and candidates in Washington have reported $3.1 million in political ad payments to Facebook and $1.5 million to Google since 2008,” the Times says.
>> Context: This may be the new media era, but local alt weeklies are still stirring the pot. According to the Times, pressure on the social media giants started to mount last year after an editor for The Stranger pressed Facebook and Google for the ad data.
That’s all for this week! Remember, putting “czar” in your title makes it instantly cooler. I’d go for “Future of Law Czar,” but I feel like that might require actually going to law school.