NewYorkUniversity
LawReview
Current Issue

Volume 86, Number 6

December 2011
Articles

The PII Problem: Privacy and a New Concept of Personally Identifiable Information

Paul M. Schwartz, Daniel J. Solove

Personally identifiable information (PII) is one of the most central concepts in
information privacy regulation. The scope of privacy laws typically turns on
whether PII is involved. The basic assumption behind the applicable laws is that if
PII is not involved, then there can be no privacy harm. At the same time, there is no
uniform definition of PII in information privacy law. Moreover, computer science
has shown that in many circumstances non-PII can be linked to individuals, and
that de-identified data can be re-identified. PII and non-PII are thus not immutable
categories, and there is a risk that information deemed non-PII at one time can be
transformed into PII at a later juncture. Due to the malleable nature of what constitutes
PII, some commentators have even suggested that PII be abandoned as the
mechanism by which to define the boundaries of privacy law.
In this Article, we argue that although the current approaches to PII are flawed, the
concept of PII should not be abandoned. We develop a new approach called “PII
2.0,” which accounts for PII’s malleability. Based upon a standard rather than a
rule, PII 2.0 utilizes a continuum of risk of identification. PII 2.0 regulates information
that relates to either an “identified” or “identifiable” individual, and it establishes
different requirements for each category. To illustrate this theory, we use the
example of regulating behavioral marketing to adults and children. We show how
existing approaches to PII impede the effective regulation of behavioral marketing,
and how PII 2.0 would resolve these problems.

The Politics of Shareholder Voting

Lee Harris

NYULawReview-86-6-Harris.pdf
Economic theory that suggests underperforming boards of directors should be
fearful of an ouster vote by shareholders underappreciates the complexity of shareholder
voting decisions. Skill at enhancing firm value has less to do with whether
directors win votes and stay at the helm of public companies than previous commentators
have presumed. Instead, like incumbent politicians, managers of some of
the largest U.S. firms tend to stay in charge of firms because they understand—and
take advantage of—the political dynamics of corporate voting. This Article presents
a competing theory of shareholder voting decisions, one that suggests that shareholder
voting in corporate elections is not dissimilar from citizen voting in political
elections. Next, the Article presents the evidence. Using a hand-collected dataset
from recent board elections, the Article compares the explanatory power of a standard
economic variable (long-term stock price returns) and a political variable
(money budgeted for campaigning) on election outcomes. Based on the data, directors’
ability to enhance firm value (as measured by stock price returns) is not significantly
related to whether they win reelection. Rather, the likelihood of being
returned to office appears to be a function of typical election politics—how much
was spent by challengers to persuade shareholder voters. These findings have at
least two implications. First, the theory that shareholder voting may be politicized
helps point the way to how the SEC ought to craft reforms—and, just as important,
how not to craft them. Recent SEC reform efforts have the laudable goals of creating
new conduits for shareholders to participate in firm affairs, increasing
shareholder-nominated candidate success, and disciplining incumbent managers.
The results of this study suggest that these reforms will not achieve the stated goals.
Even with these reforms, the board continues to have an important political advantage,
which likely translates into real votes. As the research here shows, the outcome
of elections depends on persuasion and, not simply, as the SEC contends, on shareholders’
director nominees being presented alongside those of management.
Second, the evidence and theory about shareholder voting presented here has significant
implications for understanding mergers and acquisitions, particularly hostile
acquisitions. The theory is that acquirers have steep incentives to target firms
with poor performance. In most cases, however, such acquisitions depend on winning
a vote from shareholders. Thus, if there is any disciplinary effect created by the
prospect of takeovers, it depends crucially on understanding what motivates shareholder
voting behavior. If voting shareholders respond to political motivations, not
economic ones, then the performance of target board members might not be as
relevant as takeover theorists had previously surmised.

The Immigration Penalties of Criminal Convictions: Resurrecting Categorical Analysis in Immigration Law

Alina Das

For over a century, noncitizens in the United States have faced adverse immigration
consequences if convicted of certain types of offenses in criminal court. Many criminal
convictions carry severe immigration penalties, including deportation, detention,
and the denial of statuses like asylum and U.S. citizenship. The Supreme
Court recently recognized that these penalties are so intimately tied to criminal
court adjudications that criminal defense attorneys have a duty to advise noncitizen
defendants of the immigration consequences of a conviction before the entry of a
guilty plea in criminal court. Yet there is little clarity about how to determine
whether a particular conviction triggers an immigration penalty. Historically, courts
and immigration officials have applied a categorical analysis to assess the immigration
consequences of a criminal conviction. Under a categorical analysis, a court or
immigration official determines the penalties based on an examination of the statutory
definition of the offense, not the factual circumstances of the crime. However,
several recent Supreme Court, federal court, and agency decisions have ignored this
longstanding analysis and have instead examined these issues through the lens of
Taylor v. United States, a criminal sentencing case that adopts a categorical analysis
in a different context. Distinguishing Taylor and its criminal sentencing rationales,
these decisions have invented a new approach to assessing past criminal
convictions in the immigration context. That approach now permits a circumstance-specific inquiry into facts beyond the criminal court’s findings in some immigration
cases. Under these recent decisions, the immigration consequences of a criminal
conviction no longer turn on the criminal court adjudication alone, but may also be
determined by facts that were not proven or pleaded in the criminal court proceeding.
This Article argues that this shift in approach is based on a fundamental
misunderstanding of the origins of categorical analysis in immigration law and its
independent rationales, including its promotion of notice and an opportunity to be
heard, uniformity, predictability, efficiency, and judicial review in the administrative
agency context. This Article further argues that, because of this flaw in the
current debate, courts have failed to consider the negative impact of the erosion of
categorical analysis on the functioning of the current immigration and criminal justice
systems. The rationales for categorical analysis apply with even greater force
today than they did when categorical analysis was first articulated nearly a century
ago. Rather than erode categorical analysis, courts and the agency should require
its robust application in light of its longstanding rationales and modern-day
implications.

Notes

Secondary Considerations in Nonobviousness Analysis: The Use of Objective Indicia Following KSR v. Teleflex

Natalie A. Thomas

One of the basic requirements for patenting an invention is that the invention be
nonobvious. Following the Supreme Court’s decision in Graham v. John Deere,
secondary considerations—also known as objective indicia of nonobviousness—
have been considered when determining whether an invention is nonobvious. Secondary
considerations provide tangible evidence of the economic and motivational
issues relevant to the nonobviousness of an invention. Types of secondaryconsiderations
evidence include commercial success, long-felt but unmet need, and
copying by competitors. For many years, the Federal Circuit’s teaching, suggestion,
or motivation test often eliminated the need for the court to rely on secondary considerations
in the obviousness inquiry. Due to the Federal Circuit’s stringent application
of this test, the obviousness inquiry was generally resolved by examining the
prior art.
In 2007, the Supreme Court decided KSR v. Teleflex, which endorsed a flexible
obviousness analysis and rejected the Federal Circuit’s strict application of the
teaching, suggestion, or motivation test. Following KSR, scholars predicted that
secondary-considerations evidence would provide a critical tool for patentees
seeking to demonstrate the nonobviousness of an invention. Inspired by that prediction,
this Note evaluates how secondary-considerations evidence has been utilized
in the first few years post-KSR. It finds that the Federal Circuit has continued to
impose stringent relevancy requirements on the use of secondary-considerations
evidence, and that it remains difficult for patentees to employ secondary considerations
in favor of a nonobviousness conclusion. Specifically, secondaryconsiderations
evidence has not been used with much success outside of pharmaceutical
patent cases. More often than not, the Federal Circuit has summarily dismissed
secondary-considerations evidence as insufficient in cases involving
mechanical arts patents. This Note concludes by suggesting that the Federal
Circuit’s current practice for using secondary considerations should inform proposals
by scholars for industry-specific tailoring of the patent system and patent
law’s use of secondary considerations, and that the Federal Circuit should continue
to engage with secondary-considerations evidence in order to provide more guidance
to lower courts during the post-KSR transition period.

The Law of Democracy and the Two Luther v. Bordens: A Counterhistory

Ari J. Savitzky

How, and how much, does the Constitution protect against political entrenchment?
Judicial ineptitude in dealing with this question—on display in the modern Court’s
treatment of partisan gerrymandering—has its roots in Luther v. Borden. One hundred
and sixty years after the Luther Court refused jurisdiction over competing
Rhode Island state constitutions, judicial regulation of American structural democracy
has become commonplace. Yet getting here—by going around Luther—has
deeply shaped the current Court’s doctrinal posture and left the Court in profound
disagreement about its role in addressing substantive questions of democratic fairness.
While contemporary scholars have demonstrated enormous concern for the
problem of the judicial role in policing political entrenchment, Luther’s central role
in shaping this modern problem has not been fully acknowledged. In particular,
Justice Woodbury’s concurrence in Luther, which rooted its view of the political
question doctrine in democratic theory, has been completely ignored. This Note
tells Luther’s story with an eye to the road not taken.

The Tailoring Rule: Mending the Conflict Between Plain Text and Agency Resource Constraints

Kirti Datla

In 2010, the Environmental Protection Agency (EPA) promulgated the Tailoring
Rule. The Rule “tailors” the numeric triggers for permitting requirements in the
Clean Air Act by revising the numbers upward by several orders of magnitude.
EPA argued that doing so was necessary to avoid the impossible administrative
burden that would result from having to carry out the plain text of the Act as
applied to greenhouse gases. At first glance, the Tailoring Rule seems to be a classic
case of an agency exceeding its authority and subverting congressional intent. Upon
further examination, it becomes clear that EPA is grappling with an important issue
that current administrative law doctrine fails to adequately address: What should an
agency do when it does not have the resources to carry out all of its required duties?
This Note argues that courts should use the rationale of administrative necessity to
allow agencies to openly demonstrate that it would be impossible to fully carry out
their nondiscretionary statutory duties. Upon that demonstration, courts should
allow agencies to promulgate regulations that propose a solution to that
impossibility.

Toxic Assets: The EPA’s Settlement of CERCLA Claims in Bankruptcy

Scott E. Blair

The Environmental Protection Agency’s (EPA) recent settlement of environmental
cleanup claims against Asarco, the highest such settlement in history, highlights the
incongruity between the tools at the Agency’s disposal to recover cleanup costs and
its actual behavior in pursuing such claims. The Comprehensive Environmental
Response, Compensation, and Liability Act of 1990 (CERCLA) provides statutory
authority that should allow EPA to force polluters to fully bear the burden of
cleaning up pollution. However, despite EPA’s relative success against solvent
responsible parties, EPA appears to be less aggressive in pursuing CERCLA
claims against insolvent polluters, even though the Bankruptcy Code provides additional
tools to give EPA an advantage relative to creditors. This Note explains the
statutory advantages that EPA has under CERCLA and the Bankruptcy Code, and
then explores how EPA fails to behave like a rational economic actor in pursuing
its CERCLA claims. I conclude by positing political factors and budget shortfalls
as two potential explanations of EPA’s behavior.

Innovations on the Cutting Edge of Ariad: Reinventing the Written Description Requirement

Jonathan E. Barbee

For the great majority of its history, the written description requirement was an
often-ignored relic of the patent statute. As technology advanced, the written
description requirement developed teeth as a means for invalidating patent claims
during litigation. Written description doctrine reached its peak in Ariad
Pharmaceuticals, Inc. v. Eli Lilly & Co.
, when the Federal Circuit created a significant
setback for groundbreaking innovation. Ariad demonstrated that the written
description doctrine lacked sufficient recognition of the fundamental policies and
purposes of the patent system and that this could have serious consequences for
innovation. This Note attempts to rectify the written description doctrine by
reorienting the doctrine in innovation policy. To do so, I first apply an alternative
version of the “prospect theory” of patents to conventional patent policy. Based on
this policy calculus, I then devise a reformed hypothetical innovation test that looks
outside of the “four corners” of the patent and considers the larger impact that the
written description has on the patent system. Without such doctrinal reform, the
written description doctrine of Ariad and its legacy risks undermining the incentives
that motivate inventors to undertake cutting-edge technology.