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This week: When buying an IP address becomes a crime, why quarantines are perfectly legal in the US and tips for law firms — and lawyers — that want to do more than practice law.
💸 Inside the first fraud case involving the purchase of IP addresses
Shell entities aren’t just for the super rich anymore: A Charleston, S.C.-based web services organization called Micfo allegedly created shell companies to obtain IP numbers — and, according to the Wall Street Journal, the Department of Justice counts that as fraud.
- Meet your IP maker: The American Registry for Internet Numbers assigns IP (internet protocol) numbers for every device that uses the internet. They are the digital equivalent of a home address.
- Internet shells: According to federal prosecutors, Micfo obtained 800,000 IP addresses for fake companies from the Registry, which is the alleged fraud victim. The company would then sell or lease the addresses to clients that run Virtual Private Networks (VPNs) that give web users anonymity.
- VPNs can be sketchy: Although VPNs have many practical uses, they can also be used to conceal illicit activity. All of Micfo’s VPN clients’ activities were untraceable when they passed through Micfo’s hosting servers.
Micfo’s CEO does not dispute the main allegations
Micfo is not being prosecuted for any connections to illegal activity by the VPN clients. The fraud case centers on the creation of fake companies to get the IP addresses.
- CEO Amir Golestan acknowledged to the WSJ creating fake companies to get the IP addresses, likening it to an overseas phone operator using a fake American name. He said he couldn’t have defrauded the American Registry for Internet Numbers because he paid for them properly — an argument the Registry dismisses as irrelevant.
- But the Registry does little to no vetting over applicants seeking IP addresses. Its M.O. for years had been to freely hand out IP numbers to increase connectivity on the web.
Micfo does not intend to settle for a plea bargain. The court case could set a precedent for future prosecutions in what has been a largely unregulated internet space.
🧑⚖️ Coronavirus and the law
After the United States flew dozens of stranded cruise ship passengers back to American soil, it forced them to submit to another two-week quarantine. This decision was perfectly legal: As The Atlantic recapped, U.S. governments have nearly unlimited powers to force a quarantine.
- From the highest court in the land: Typically, the government can only hold citizens for wrongdoing or suspicion of wrongdoing. But the Supreme Court upheld America’s power to quarantine in 1824 and 1900, ruling, “from an early day the power of the States to enact and enforce quarantine laws for the safety and the protection of the health of their inhabitants … is beyond question.”
- It doesn’t matter if you’re sick, either: Healthy people can be quarantined alongside the sick. And the government can also require medical exams and vaccinations (bad news, anti vaxxers!)
Quarantine power mostly resides with states and localities
The Feds have jurisdiction only at the borders, or on a plane full of travelers. They can block foreigners from entry and force American citizens to enter quarantine (they cannot turn American citizens away). It’s up to state and local governments to enforce — or disregard — federal quarantine guidelines.
Local quarantine powers mean a coherent national quarantine plan would be difficult for the United States to execute. It also means states could block people from other states and cities from entering. Let’s hope we never have a disease outbreak that forces us to dig deeper into the legal details.
🙌 New standards for a new legal world
Thanks to consistent demand, life as a lawyer has largely been unchanged for decades. But new technological and economic pressures have emerged, disrupting the profession. Anders Spile, a legal tech and innovation consultant, mapped out in the ABA Journal how and why law firms must become professional services firms to continue to thrive.
Think like the Big Four: Deloitte, EY, KPMG and PwC do everything from IT to data to legal services and beyond. Their clients keep coming back because of the convenience of the one-stop shop. Spile suggests that law firms need to think like these firms in order to keep their business.
How it can be done: By creating a small group inside a firm that works on nonlegal professional services or merging with small companies that offer these services. Spile says the firms that make these choices now will hold great advantages over their competitors.
If you’re a young, tech-savvy lawyer, approach law firms with these ideas: Spile says partner-driven law firms that are still making heaps of cash are complacent enough to assign head of innovation jobs to young lawyers solely because they’re young (how do you do fellow, kids?). There’s a real opportunity for lawyers who have actual innovative skills and a business/consulting background that proves they can convince an outdated industry to change.
What else we’re forwarding
Eurotrip!: Big Tech CEOs, including Mark Zuckerberg, have traveled to Belgium to lobby EU officials, who are designing new digital policies.
Ridiculous pickup lines for lawyers: Want to “Westlaw and chill?” and other funny one-liners.
The SEC goes after Tesla again: The SEC is again going after Tesla, less than two years after it punished the company for statements Elon Musk made about going private. This time, the SEC asked for financial data and other documents.