Overnight Tech: Lawmakers want answers on Uber breach | Justices divided in patent case | Tech makes plea for net neutrality on Cyber Monday

REPUBLICAN SENATORS PUSH UBER ON CYBER BREACH: Four GOP senators are demanding more details from Uber about a cyber breach the ride-hailing firm endured in which the accounts of 57 million users were compromised.

Lawmakers say the breach opens new security concerns despite Uber’s claims that sensitive information, such as riders’ trip history and Social Security numbers, were not stolen.

They also say that Uber’s reported payment to hackers of $100,000 to delete compromised data could be a potential violation of Federal Trade Commission (FTC) regulations.

{mosads}”Our goal is to understand what steps Uber has taken to investigate what occurred, restore and maintain the integrity of its systems, and identify and mitigate potential consumer harm and identity theft-related fraud against Federal programs,” the senators wrote in a letter Monday to Uber CEO Dara Khosrowshahi.

Sens. John Thune (R-S.D.), Orrin Hatch (R-Utah), Jerry Moran (R-Kan.) and Bill Cassidy (R-La.) signed the letter.

The lawmakers provided a set of questions for Khosrowshahi to answer, including when Uber first learned of the hack, what regulators Uber has spoken with about the matter and what Uber has done to mitigate the impact of the breach.

Read more here.

 

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DEMS ALSO WANT ANSWERS FROM UBER: The massive 2016 breach disclosed by Uber last week has triggered questions on Capitol Hill, with Sen. Mark Warner (D-Va.) also demanding answers from company leadership on its response to the incident.

“I write to you with grave concerns about your company’s handling of a breach impacting millions of your users and hundreds of thousands of your drivers,” Warner wrote in a letter to Uber CEO Dara Khosrowshahi on Monday.

Warner sounded the alarm over the revelations on Monday, saying that the company may have run afoul of federal and state regulations by failing to disclose the breach to customers until now. The company is already facing multiple investigations by state attorneys general, including those in New York and Massachusetts.

Read more here.

 

JUSTICES DIVIDED IN PATENT CASE:  The Supreme Court on Monday wrestled with whether Congress has the authority to shift how patent challenges are reviewed from the courts to a government board.

Oil States Energy Co., a Houston-based oilfield services company, is challenging the U.S. Patent and Trademark Office review process for patent disputes.

The process was created by Congress in the 2011 American Invents Act (AIA) and is known as an ‘inter partes review,” with the office’s Patent Trial and Appeal Board hearing any challenges to existing patents.

The case stems from a dispute Oil States had with another oilfield services company Greene’s Energy Services LLC over a patent for wellheads used in hydraulic fracturing.

Allyson Ho, who argued on behalf of Oil States Energy, said the process Congress created violates the separation of powers because the government itself — through the patent office — is acting as the adjudicator between two private parties.

But Justice Stephen Breyer said agencies decide all kinds of matters through adjudicatory-type procedures often involving private parties.

Read more from The Hill’s Lydia Wheeler here.

 

TECH’S CYBER MONDAY NET NEUTRALITY PUSH: Hundreds of tech companies and groups, including Twitter, Airbnb, Reddit and Vimeo, are urging the Federal Communications Commission (FCC) to keep the Obama-era net neutrality rules.

In a letter to FCC Chairman Ajit Pai dated on Cyber Monday, the companies touted the growth of e-commerce as “a testament to the power of the free and open internet to encourage entrepreneurship, drive innovation, make our lives easier, and to support a healthy economy.”

“The internet is increasingly where commerce happens,” the letter said, noting that Americans last year spent nearly $3.5 billion on Cyber Monday.

“Our current net neutrality rules support innovation and give all businesses the opportunity to compete equally for consumers. With strong net neutrality protections, the internet is an open marketplace where any business can compete, allowing individuals to start companies easily, market their products across the country, and connect with customers anywhere worldwide,” they wrote.

Read more here.

 

WHAT THE GOP TAX PLAN MEANS FOR TECH: Republicans and major technology firms who support a tax overhaul have touted reforms that they say will bring offshore profits back into the country, boosting U.S. tax revenue and benefiting the economy.

But critics are skeptical of those claims, doubting that both the House and Senate versions of the tax bill give companies like Apple the incentive to bring money into the U.S. over the long term.

One of the central pieces of the Republican plan is a one-time lower rate on foreign income repatriated to the United States.

Under the House bill, foreign companies could pay a 7 percent rate on repatriated illiquid assets and a 14 rate on repatriated cash or assets that are easily convertible to cash, while the Senate rates would be 5 and 10 percent, respectively.

The repatriation would be paired with a dramatic cut in the corporate tax rate to 20 percent and a shift to a territorial tax system, two things corporations have long asked for.

Sen. Chuck Grassley (R-Iowa), who sits on the Senate Finance Committee, said he believes the GOP’s tax reforms will not only bring earnings back onshore, but also attract “a lot of foreign investment” to the U.S. from overseas.

But Democrats and tax experts question why U.S. companies would continue bringing profits back to the U.S. once the lower rates for repatriation expire.

Read more here.

 

ON TAP:

Center for Democracy & Technology will hold event on the Supreme Court cellphone privacy case, featuring Sen. Ron Wyden (D-Ore.) at 9:30 a.m.

The Information Technology and Innovation Foundation (ITIF) will hold an event on the state of tech-based startups at 9:30 a.m.

 

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