Sex-trafficking bill hits a nerve in Silicon Valley - Axios
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Sex-trafficking bill hits a nerve in Silicon Valley

Lazaro Gamio / Axios

Of all the policy fights big internet companies are facing this fall, a sex-trafficking bill with bi-partisan support on the Senate has them rattled the most. And it has the potential to escalate quickly as critics of Silicon Valley firms look for opportunities to hit them where it hurts.

What it does: The bill, backed by senators Rob Portman and Richard Blumenthal, aims to hold online platforms liable for illegal ads that led to sex-trafficking.
Why it matters: Internet companies including Google, Facebook and Amazon say that the bill threatens the core of their business models — because they couldn't have grown to their current size if they were responsible for all of the content they host. But by opposing the measure, they're being painted as not doing enough to help the victims of sex-trafficking.

The details: A provision (section 230) of the Communications Decency Act broadly shields web platforms from legal liability for what their users post or for filtering offensive content. This protects YouTube, for example, from being held legally responsible for all the user-generated content posted by more than 1 billion users. A bipartisan coalition of senators wants to amend that law so that victims of sex trafficking can sue websites that are found in court to have helped facilitate the crime. There's an even harsher bill in the House.

The backstory: Portman and others have been investigating Backpage.com for its connection to sex-trafficking for years, and cited the website for contempt of Congress last year. But lawmakers say that victims will still struggle to find justice if they can't sue the website for its role in trafficking.

  • Courts have repeatedly looked at the issue. In August, a judge dismissed pimping charges against Backpage.com, the site that triggered the bill, saying that that Section 230 would continue to shield sites from from being held responsible for allegedly helping traffickers unless Congress changes the law.

Internet companies' reaction: While the companies themselves have stayed quiet, their trade associations and the think tanks they fund have come out swinging against the bill.

  • The Internet Association, which represents Google, Facebook, Amazon and others, warned the bill would expose its members to lawsuits and said that it "jeopardizes bedrock principles of a free and open internet, with serious economic and speech implications well beyond its intended scope." Noah Theran, an association spokesman, said in a later statement that the "internet industry has and continues to be committed to finding additional ways to combat trafficking and hold criminal actors accountable."
  • The group said in a policy paper that a renegotiated version of the North American Free Trade Agreement should "prohibit governments from making online services liable for third-party content."
  • The industry has also suggested that the bill could cause them to pull back on their current efforts to combat content related to sex-trafficking because being aware of the activity at all could expose them to new liability.
The other side: Supporters of the legislation are frustrated with the industry's unwillingness to find a solution to the problem.
  • Supporters say the bill sets a high bar for liability and is narrowly tailored to address only the kind of trafficking activity it's meant to target, including allowing companies to continue to filter offensive and illegal content.
  • The sponsors were in contact with the industry for more than a year before they announced the bill. Kevin Smith, a spokesman for Sen. Portman, says the companies declined to give "constructive feedback" on the bill.
  • This week, lawmakers got a victory in their effort to get other tech backing for the bill: an Oracle policy exec said in a letter that the company supported the bill and that the "legislation does not, as suggested by the bill's opponents, usher the end of the Internet." That'll let Portman and others claim some Silicon Valley support and also gives Oracle another chance to stick it to Google in their long-running fight.
The politics here are complicated. In past policy fights, the tech industry gained the upper hand by rallying users to deluge lawmakers with emails, calls and messages on online platforms, as was seen in the successful effort to crush the SOPA/PIPA copyright bills in 2012.
But sex-trafficking rings endangering children are a much more emotionally charged issue than copyright law. Google and Facebook don't want to be seen as rhetorically linked to sex-trafficking schemes but also worry it opens the door to more legal liability for content on their sites down the road. Lawmakers and children's advocates, meanwhile, argue that these extremely profitable companies have a responsibility and ample resources to help combat sex-trafficking.
Next steps: Senate sponsors could try to attach their bill to a larger piece of legislation (though that can be hard) or move it through committee. There's a similar bill in the House backed by more than 100 lawmakers — but so far most of the focus has been on the Senate.
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Why it matters: The Senate tax plan includes a repeal of the mandate, which helps stabilize insurance markets by incentivizing healthy people to buy coverage. This may be a signal Murkowski intends to vote yes on the plan.

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Three military personnel who worked for the White House Communications Agency are being reassigned for alleged "improper contact with foreign women" during President Trump's Asia trip, according to the Washington Post. The service members are responsible for providing "secure communications" to the president, vice president, and secret service.

Flashback: Four members of the same team faced similar allegations in August while in Panama ahead of Vice President Pence's arrival in the country.

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California Congressman Dana Rohrabacher has come under scrutiny in recent months from special counsel Robert Mueller and the Senate Intelligence Committee for his close ties to the Kremlin, according to the New York Times. One eye-catching line: "the F.B.I. warned him in 2012 that Russia regarded him as an intelligence source worthy of a Kremlin code name."

Why it matters: Rohrabacher, a Republican, had no role in President Trump's election, but there have been several instances of him "showing up" at moments relevant to the Russia investigation, per the Times. His position as chairman of the House Foreign Affairs subcommittee on Europe, Eurasia and Emerging Threats is also a point of concern for some.

  • He accepted a "confidential" memo including accusations against Democratic donors in April 2016 in Moscow, which later resurfaced in the Trump Tower meeting between Donald Trump Jr. and Russian lawyer Natalia V. Veselnitskaya.
  • He met with last August at the Ecuadorean Embassy with Julian Assange , who is believed to have "acted as a conduit for Russian operatives seeking to release a trove of hacked Democratic emails."
  • He had dinner with Alexander Torshin, the deputy governor of a Russian central bank that tried to set up a "backdoor" meeting with then-candidate Trump and Vladimir Putin.
Rohrabacher said "none of the meetings were untoward or inappropriate," per the Times: "I want to treat Russia as if it is a nation state that deserves to be judged as all other nation states are judged."
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Between the lines: The acquisition adds to the growing rumors that Apple is planning to develop more augmented and virtual reality products in the future. The release this year of its ARKit showed the company's interest in augmented reality using smartphones, but it's hard to believe Apple isn't interested in adding new devices to its lineup. Also in June, it confirmed it acquired a small German maker of eye-tracking glasses.

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Why it matters: It's illegal under the Logan Act for a private citizen to communicate with a foreign government to attempt to influence U.S. policy, but no one has been convicted under that law and it's unclear whether that's what Mueller is investigating. What is clear is that the Mueller investigation is going far beyond collusion with Russia to influence the election.

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Why it matters: This woman was not a part of the sexual harassment settlement made in 2015, which Conyers admitted to making on Tuesday while denying claims of sexual harassment. The victim of the new incident sued Conyers for over $100,000, but later withdrew the lawsuit after the court denied her request to keep the complaint private.

  • According to BuzzFeed, the staffer describes daily harassment by Conyers from May to July 2016, including "rubbing on her shoulders, kissing her forehead, covering and attempting to hold her hand," and more.
  • She said this caused "insomnia, anxiety, depression and chest pains," which was made worse after Conyers' wife Monica called her a "whore."
  • The staffer "eventually became so unwell" that she attempted to take sick leave in 2016, and was fired after Conyers' chief of staff Raymond Plowden "demanded" proof that she was sick.
  • She filed a motion in February to file a lawsuit kept private from the public because she wanted to avoid "irreparably [harming]" the Congressman. It was ultimately rejected, and she "sought to withdraw her lawsuit with prejudice," which would keep her from re-filing later, per BuzzFeed.
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The Jerusalem Post reports: "Palestinians have frozen ties with the U.S. Consulate in Jerusalem and American officials visiting the West Bank ... If Jared Kushner, President Donald Trump's senior adviser, or Jason Greenblatt, the administration's main peace envoy came to the West Bank, PA officials would not be able to meet with them."
Why it matters: A senior adviser to Palestinian leader Mahmoud Abbas said they're freezing communications because the State Department won't renew the certification of the Palestinian Liberation Organization's representative office in Washington, D.C. If the office is forced to close, it would almost certainly derail the Israeli-Palestinian peace negotiations being brokered by the Trump administration.

The details:

  • The PLO office is the de facto Palestinian embassy to the U.S. and was an important symbol for Palestinian diplomatic achievements.
  • The Palestinians say closing the office would be the equivalent to cutting diplomatic ties between the U.S. and the Palestinian Authority, and would be a proof the Trump administration can't be an honest broker in future peace talks.

Between the lines: There's been speculation that the Trump administration's refusal to certify the Palestinian office was a tactic to gain leverage over the Palestinians in the peace talks. That's false. Secretary of State Rex Tillerson had to sign a letter of decertification regarding the PLO office because the law obliged him to notify Congress if the Palestinians are encouraging the International Criminal Court to prosecute Israel for alleged war crimes (which Palestinian President Abbas did in his UN speech in September).

  • Until now, the Palestinian actions and rhetoric regarding their relations with the U.S. had been mostly symbolic.
What we're hearing: Both sides are still talking to each other, and the office is still open — for now. Relations are not suspended yet. State Department officials tell us they're still in contact with Palestinian officials about the status of the PLO office, as well as about the administration's larger efforts to advance a lasting and comprehensive peace.

The bottom line: The Trump administration is sorting through its political and legal options to navigate this tense — and potentially disastrous — situation.

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Why it matters: Amazon aside, Macy's has made numerous mistakes — like doubling down on department stores the same year Amazon Prime debuted — which have hastened the retailer's decline and put it in a position to see its profits halved over the past three years.

Macy's existential test, per Bloomberg: "The premise of a department store—to be able to buy a mattress and pajamas in the same place — is still valuable. But today that place is called Amazon, and there you can buy toothpaste, too, and have it all delivered in two days. So the question is, What do department stores have that Amazon doesn't?"

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Even if Macy's executes, more closures are likely ahead: If Macy's is to succeed by selling to its core base of shoppers, that will still require the firm to shrink.
  • There are more than 660 Macy's stores in America, but CFO Karen Hoguet says that only 245 would be "critical" assets if the company were to start over today.
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The big deal: Instead of immediately disclosing the incident to customers and relevant government agencies, Uber paid the hackers $100,000 to delete the data and keep the incident quiet. Ex-Uber CEO Travis Kalanick, who was ousted in June, learned of the incident one month after it happened. The attack was discovered recently by an outside law firm hired by Uber's board to investigate the activities of Sullivan's security team.

New order: This is the latest attempt by new CEO Dara Khosrowshahi to set a new tone for the company, which has long been known to skirt regulations.

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What's next: AT&T is expected to request an expedited trial to fight the Justice Department's lawsuit. The case has been assigned to Judge Richard Leon, a senior judge on the District of Columbia District Court, who was appointed by President George W. Bush, Reuters reports. Some observers see that as a good sign for the deal, as Republican-appointed judges are typically more business-friendly.