SXSW panel on drones fever: benefits vs. privacy

“Drones are here to stay, and to me that's a very good thing.”

Presenting at SXSW Interactive—where just days before the Austin Police Department had banned all drones from flying in the skies above the festival—Lisa Ellman spoke enthusiastically about the benefits that drones bring and how industry and government can satisfy those who are concerned about drones encroaching on personal privacy.

Ellman—who helped craft Obama administration policies on the use of drones in the United States—presented the positives and the negatives, from what she sees as smart and nonsensical regulation as well as the worthy and concerning usages of drones.

“When I first started working for President Obama, drones were just a blip on the radar,” Ellman said. “Now they are everywhere. They are the present and are quickly becoming the future. I believe the key to good policy making in this area ... is poli-vation—policy makers and innovators working together.”

Referring to the machines as “smartphones in the sky,” Ellman said that the uses for drones range from toys to tools of war, and that they can be used for fun, safety, and technology that makes life better. Among the possible positive functions, she mentioned a drone’s potential to deliver SXSW badges to attendees with the use of facial recognition technology, help farmers survey and dust their crops, film movies from high and varying vantage points, deliver beer, or drop medications in rural areas. Disney, for example, is interested in using drones to replace fireworks in its theme parks; the NFL, meanwhile, has reportedly considered using drones to do things like take footballs to midfield.

But, Ellman said, while America leads the world in producing the technology, it follows in areas of implementation. In Japan, 85 percent of crop dusting is done by drones, she said. “Drones will help America hold on to our competitive advantage."

Despite all the benefits that drones can offer, many Americans are wary of the flying machines’ ability to survey areas of life that have been private for so long. Drones are often equipped with cameras and can photograph anything from homes to employees skipping work to shop at the mall. Ellman explained the concerns as relating to “the notion that our home is our castle, that we ought to have control over our own personal information ... that we all need time alone.”

But, she said, the modern concept of privacy is evolving. “We live in an increasingly connected world. What this means for our nation’s privacy policies, we are just starting to learn about now.” History tells us that people have commonly been fearful of innovation. When the camera was first invented, Ellman said, we worried others would take our picture without our consent; when the postal service was founded, we worried people would read our mail. “It makes sense that, decades later, we worry that drones will be used to spy on us,” said Ellman, who noted that her own father worried that drones could enable competitors to snoop on his backyard engineering projects. Such concerns raise legitimate questions, she said, such as how do we know who’s watching us, who owns the drone, and where images live and for how long?

Ellman thinks that all of these valid points must be weighed with the potential for drones to do good in the world. And here’s where policy comes in to enable the machines to perform such beneficial functions while also addressing the privacy concerns. Noting that commercial use of drones will likely be legal in a few years as Congress is working to integrate drones into federal airspace, Ellman said that there is also “no shortage of legislation from all levels of government aimed at limiting use of drones in the name of privacy.” Some policy is smart and some isn’t, she said, referring to a proposed Oklahoma law that would allow private citizens to shoot down drones that come onto their property.

When crafting legislation, Ellman said it’s important that policymakers embrace the glories of drone technology while also avoiding the duplication of laws that are already protecting the public. “It’s likely that complete bans on drone use are overbroad because they ignore the benefits,” she said. “We must ask ourselves, ‘Are drones uniquely troublesome in certain ways?’ But we must also ask, ‘What laws and policies are already in place that protect us?’” Ellman thinks that legislation on drone use without warrants is duplicative because of 4th Amendment protections already in place and that drone-focused private property laws are duplicative because trespassing laws already exist. “We should take a close look at those and see where there are gaps, but don’t duplicate,” she said.

Looking to the future, Ellman said that she sees property owners having rights to the sky above their homes, much as mineral rights protect below-ground interests such as oil and natural gas. But, these will only go so high, perhaps to about 350 feet above ground, and will have to integrate with federal airspace that begins at 500 feet (more information at noflyzone.org). While Congress works on passing legislation to allow commercial use of drones—which Ellman predicted will be law by “2017 at the latest”—interested commercial parties in the meantime can file a 333 exemption with the Federal Aviation Administration, which has granted about 500 exemptions and will soon be issuing these more quickly, she said. Noise issues are another concern, but the quieter drones become, Ellman pointed out, the more potential they have to silently spy. Another topic that must be addressed, she said, is the fear from laborers such as pilots and delivery people who worry that drones will take their work.

“There are drawbacks,” she said, “but we have to remember that many problems have solutions. Now is the time for all of us to get involved.”

For more information on Lisa Ellman, co-chair of McKenna Long & Aldridge's Unmanned Aircraft Systems Practice Group, go to the firm's website. Ellman's Tedx Talk on drones and privacy is available on YouTube.

SXSW CLE Wrap-up

Part I: Cool Things v. Consumer Privacy, Filming Unsuspecting Subjects, and Streaming Pay Scales

By the end of South by Southwest 2014—held in Austin from March 7 to March 16—attorneys were referring to the festival’s official legal program as “Camp CLE.” Like the much larger SXSW spectacle, the CLE room was full of lawyers from around the country, as well as a mix of artists, publishers, and other entertainment industry professionals. Put on by the Midwest-based Lommen Abdo Law Firm, a total of 12 sessions were held, led by 30 law experts. The Texas Bar Journal reports on several of these events below. Stay tuned to the State Bar Blog for additional SXSW CLE articles.

 

The Sentient Economy: Law and Policy for the IoT. Session leader Gerard Stegmaier—of counsel to the technology-focused firm of Wilson Sonsini Goodrich & Rosati in Washington, D.C.—explained that the Internet of Things “is like looking into the crystal ball,” which consists of objects that people use in their everyday lives that have the ability to connect to the online network. Smart phones, personal activity trackers, even refrigerators with interactive computers make up the IoT. These devices often ask for the user to provide a varying amount of personal information so that the user’s experience can be individually customized—oftentimes to motivate the user to achieve a specific goal.

Stegmaier quipped that this “machine-to-machine” connection is dangerous because it is a billion-dollar industry that involves controversial consumer privacy matters. “And when there’s that much money at stake,” he said, “lawyers come running.” Privacy law issues, Stegmaier believes, will either inhibit or prohibit the growth of the IoT. Because most consumers value being notified—or being asked for permission—any time their personal data is captured, Stegmaier recommended that tech companies consider taking such “privacy by design” approaches.

Businesses that supply objects within the IoT can get into trouble for violating deceptive-trade laws, either by being outright deceptive (when the writing used is determined to be misleading) or by being unfair (when substantial consumer injury outweighs any potential benefits). While the IoT “makes cool things possible,” he said, lawyers need to make sure consumers and companies aren’t at risk.

 

All About Hidden Camera and Investigative Reporting. A handful of attorneys mixed with dozens of filmmakers and media professionals at this CLE session, led by entertainment attorney Michael Donaldson of Donaldson & Callif in Beverly Hills. The discussion focused on the recommended practices for documentary films and news programs that film non-actors—or “unsuspecting subjects”—and wish to publicly distribute the recordings.

Donaldson noted that it is always a good idea to start by researching the relevant states’ laws on recording conversation and to try and obtain releases from any unsuspecting subjects who are filmed. The movie Borat, for example, employed a release (although not for all filmed subjects) that courts found to be “rock solid” because it was absolutely clear, in plain language, and short.

When no releases are obtained—as is commonly the case for undercover and investigative reporting pieces—the most important factor that courts have considered is the filmed individual’s expectation of privacy. A TV news show that secretly filmed a physician inappropriately prescribing painkillers lost in court based on the doctor’s reasonable expectation of privacy in his own office. On the other hand, a suit brought on by a performer who was filmed backstage beating apes that were used in his circus show was unsuccessful because the court found that he had little reasonable expectation of privacy backstage, where stage hands and other performers were frequently present.

 

Screaming About Streaming. Said to be the hot topic of this year’s SXSW CLE, this three-person panel focused on online streaming and the copyright and royalty issues related to the increasingly popular way of consuming music. Panelists included Ken Steinthal of King & Spalding in San Francisco; Colin Rushing, senior vice president and general counsel to SoundExchange; and John Simson, of counsel to Lommen Abdo Law Firm. They explained that music streaming involves two separate copyright issues: one for the composition’s publishing and another for the master recording. And, streaming itself is divided into two categories: interactive streaming (i.g., Spotify) and non-interactive (i.g., Sirius XM and—controversially—Pandora).

To illustrate this complex legal situation, panelist Steinthal focused on the recent court case involving Pandora and the American Society of Composers, Authors and Publishers, in which Pandora sought to pay the same rate that traditional radio pays (1.7 percent of revenue) for ASCAP-registered material. (Pandora insists that it is guaranteed protection to have such low rates, while publishers and ASCAP argue that it is unfair and results in an industry where millions of hits on a single song generate less than $600 in compensation.)

Panelist Rushing of SoundExchange gave the audience some historical background, noting that traditionally, radio stations had to buy the rights only to a song. But after 1995, all sound recordings broadcast via digital public performance also required publishing rights. While technically the publishing copyrights are compulsory and masters copyrights are voluntary when dealing with interactive streaming services (and vice-versa for non-interactive streaming), Steinthal and Rushing explained that it is probably best to acknowledge both copyrights.