Crime

Crooks Behind $27M in 'Refund' Scams Busted By YouTube Pranksters After Being Lured to Fake Funeral (sfgate.com) 29

One crime ring scammed 2,000 elderly people of more than $27 million between 2021 and 2023 using tech support/bank impersonation/refund scams. "Victims were in their 70s and 80s," reports the U.S. Attorney's office for California's southern district. Victims were first told they'd received a refund (either online or via phone), but then told they'd been "over-refunded" a massive amount, and asked to return that amount.

But 42-year-old Jiandong Chen just admitted Thursday in a U.S. federal court that he was involved in the fraud and money laundering via cryptocurrency — pleading guilty to two charges with maximum penalties of 40 years in prison and a $1 million fine, plus 20 years in prison with a maximum fine of $500,000 or twice the amount laundered. "Chen, a Chinese national, is the second defendant charged in a five-defendant indictment." And what tripped him up seems to be that "Certain members of the conspiracy also did in-person pickups of money directly from victims..."

And so YouTube enters the story — when the scammers called pranksters with 1,790,000 subscribers to their "Trilogy Media" channel. In an elaborate three-hour video, the team of pranksters lured the scammer to a rented Airbnb where they're staging a fake funeral with a nun. (One of the men acting in the video remembers "we start doing a prayer... I'm holding the scammer's hand in my nun outfit...")

They convince the scammer to collect the cash from a dead man — "Is there anything you'd like to say to him?" Then there's demon voices. The scammer's victim resurrects from the dead. Did the cash mule bring holy water?

The end result was a video titled "CONFRONTING SCAMMERS WITH A FAKE FUNERAL (EPIC REACTIONS)". But two and a half years later, their "cash mule sting house" video has racked up over 1.3 million views, 22,000 likes, and 2,979 comments. ("This video is longer than Oppenheimer. Thanks for the laughs fellas.")

And the scammer is facing 60 years in prison.
Businesses

Amazon Must Negotiate With First Warehouse Workers Union, US Labor Board Rules (reuters.com) 81

Amazon "must negotiate with a labor union representing some 5,000 workers at a company warehouse on Staten Island," reports Reuters, citing a ruling Wednesday from America's National Labor Relations Board (NLRB).

The union formed in 2022, according to the article, and "has been seeking to negotiate with Amazon over pay, working conditions and other matters." The NLRB said in its ruling that Amazon "has engaged in unfair labor practices" by refusing to bargain with the labor group or to recognize its legitimacy... Amazon said on Thursday it disagreed with the NLRB's ruling. "Representatives of the NLRB improperly influenced this election," the company said in a statement, suggesting it planned to appeal. "We're confident an unbiased court will overturn the original certification, and we look forward to the opportunity for our team to fairly voice their opinions." An appeal would likely preclude Amazon from having to comply with the NLRB's order while it makes its way through the courts...

Related to the Staten Island case, Amazon has argued that the NLRB itself is unconstitutional and sued to block the agency from ruling on it. The matter is still pending.

After forming independently, that union "has since aligned with the International Brotherhood of Teamsters," the article points out. The Teamsters represent 1.3 million American workers, according to a statement they issued this week, which also includes this quote from the president of Amazon Labor Union-e Local 1. "We are making history at Amazon, and we are doing it through undiluted worker power..."

Their statement adds that the ruling "came only one day after the union announced another historic victory that upheld Amazon Teamsters' right to strike."
The Almighty Buck

Netflix Must Refund Customers For Years of Price Hikes, Italian Court Rules (arstechnica.com) 46

A Rome court ruled that several Netflix price hikes in Italy were unlawful because the company's contracts didn't adequately explain or justify future pricing changes. As a result, Netflix has been ordered to issue refunds that could total roughly 500 euros for some long-term subscribers. Ars Technica reports: The lawsuit was brought by Italian consumer advocacy group Movimento Consumatori, which alleged that the price hikes violate the Consumer Code, Italian legislation that aims to protect consumer rights. The Consumer Code says it's unlawful for a "professional to unilaterally modify the clauses of the contract, or the characteristics of the product or service to be provided, without a justified reason indicated in the contract itself," according to a Google-provided translation.

The court's April 1 ruling determined that Netflix's contracts were required to explain in advance why prices or other terms might change in the future. Because the price hikes were found to be imposed without providing customers with valid justifications, the court ruled that the new prices are invalid and ordered Netflix to refund affected subscribers. This comes despite Netflix reportedly providing a 30-day advance notice of the higher fees and allowing customers to cancel their subscriptions to avoid price hikes.

The court gave Netflix 90 days to inform millions of current and former customers via email, mail, its website, and Italian newspapers of their right to refunds or else face a penalty of 700 euros per day, Italian newspaper Il Sole 24 Ore reported today. Per Italian law, price increases that Netflix has issued or will issue beyond April 2025 are legal. At that time, Netflix adjusted its terms to state that contract terms could one day change due to technological, security, or regulatory needs, to clarify clauses, or to provide changes to the service, Il Sole 24 Ore reported.

The Courts

Penalties Stack Up As AI Spreads Through the Legal System 51

Tony Isaac shares a report from NPR: When it comes to using AI, it seems some lawyers just can't help themselves. Last year saw a rapid increase in court sanctions against attorneys for filing briefs containing errors generated by artificial intelligence tools. The most prominent case was that of the lawyers for MyPillow CEO Mike Lindell, who were fined $3,000 each for filing briefs containing fictitious, AI-generated citations. But as a cautionary tale, it doesn't seem to have had much effect. The numbers started taking off last year, and the rate is still increasing. He counts a total of more than 1,200 to date, of which about 800 are from U.S. courts. "I am surprised that people are still doing this when it's been in the news," says Carla Wale, associate dean of information & technology and director of the law library at the University of Washington School of Law. "Whatever the generative AI tool gives you -- as in, 'Look at these cases' -- you, under the rules of professional conduct, you have to read those cases. You have to read the cases to make sure what you are citing is accurate."

"I think that lawyers who understand how to effectively and ethically use generative AI replace lawyers who don't," she says. "That's what I think the future is."
The Courts

UFC-Que Choisir Takes Ubisoft To French Court Over the Crew Shutdown (reuters.com) 53

Longtime Slashdot reader Elektroschock writes: When Ubisoft pulled the plug on The Crew's servers without warning, players were left with a worthless game they'd already paid for. Now, consumer watchdog UFC-Que Choisir is fighting back, demanding gamers' right to play regardless of publisher whims. Supported by the "Stop Killing Games" movement, this landmark case challenges unfair terms before the Creteil Judicial Court (Val-de-Marne near Paris), and aims to protect players from disappearing games. The lawsuit that UFC-Que Choisir filed against Ubisoft on Tuesday alleges that the video game publisher "misled consumers about the permanence of their purchase and imposed abusive contractual clauses stripping players of ownership rights," reports Reuters.
Open Source

AI Can Clone Open-Source Software In Minutes 125

ZipNada writes: Two software researchers recently demonstrated how modern AI tools can reproduce entire open-source projects, creating proprietary versions that appear both functional and legally distinct. The partly-satirical demonstration shows how quickly artificial intelligence can blur long-standing boundaries between coding innovation, copyright law, and the open-source principles that underpin much of the modern internet.

In their presentation, Dylan Ayrey, founder of Truffle Security, and Mike Nolan, a software architect with the UN Development Program, introduced a tool they call malus.sh. For a small fee, the service can "recreate any open-source project," generating what its website describes as "legally distinct code with corporate-friendly licensing. No attribution. No copyleft. No problems." It's a test case in how intellectual property law -- still rooted in 19th-century precedent -- collides with 21st-century automation. Since the US Supreme Court's Baker v. Selden ruling, copyright has been understood to guard expression, not ideas.

That boundary gave rise to clean-room design, a method by which engineers reverse-engineer systems without accessing the original source code. Phoenix Technologies famously used the technique to build its version of the PC BIOS during the 1980s. Ayrey and Nolan's experiment shows how AI can perform a clean-room process in minutes rather than months. But faster doesn't necessarily mean fair. Traditional clean-room efforts required human teams to document and replicate functionality -- a process that demanded both legal oversight and significant labor. By contrast, an AI-mediated "clean room" can be invoked through a few prompts, raising questions about whether such replication still counts as fair use or independent creation.
Social Networks

Australia Readies Social Media Court Action Citing Teen Ban Breaches (reuters.com) 27

Australia is preparing possible court action against major social media platforms that are failing to enforce the country's social media ban on under-16s. "Three months after the ban came into effect, the eSafety Commissioner said it was probing Meta's Instagram and Facebook, Google's YouTube, Snapchat and TikTok for possible breaches of the law," reports Reuters. From the report: Communications Minister Anika Wells said the government was gathering evidence "so that the eSafety Commissioner can go to the Federal Court and win." "We have spent the summer building that evidence base of all the stories that no doubt you have all heard ... about how kids are getting around that," Wells told reporters in Canberra. The legal threat is a striking change of tone from a government which had hailed tech giants' shows of cooperation when the ban went live in December.

Under the Australian law, platforms must show they are taking reasonable steps to keep out underage users or face fines of up to $34 million per breach, something eSafety would need to pursue in a civil court. The regulator previously said it would only take enforcement action in cases of systemic noncompliance. But in its first comprehensive compliance report since the ban took effect, eSafety said measures taken by the platforms were substandard and it would make a decision about next steps by mid-year. "We are now moving âinto an enforcement stance," said commissioner Julie Inman Grant in a statement.

The regulator reported major compliance gaps, including platforms prompting children who had previously declared ages under 16 to do fresh age checks, allowing repeated attempts at age-assurance tests until a child got a result over 16 and poor pathways for people to report underage accounts. Some platforms did not use age-inference, which estimates age based on someone's online activity, and some only used age-assurance measures like photo-based checks after a user tried to change their age, rather than at sign-up. That made it "likely many Australian children aged under 16 have been able to create accounts on age-restricted social media platforms by simply declaring they are 16 or older", the regulator said. Nearly one-third of parents reported their under-16 child had at least one social media account after the ban took effect, of which two-thirds said the platform had not asked the child's age, it added.

Government

US Paves Way For Private Assets To Be Included In 401(k) Retirement Plans (reuters.com) 99

An anonymous reader quotes a report from Reuters: The Trump administration on Monday issued a long-awaited proposed rule to open up retirement plans to alternative assets, paving the way for private equity and cryptocurrencies to be added to 401(k) accounts. The measure, announced by the U.S. Department of Labor, is intended to ease longstanding barriers to incorporating these less liquid and less transparent assets into American retirement plans. It follows an executive order from President Donald Trump last summer and could clear the way for alternative asset management firms to tap a large new source of capital.

Industry groups have argued private market investments can enhance long-term returns and diversification for retirement savers, while skeptics warn higher fees, complexity and limited liquidity could limit those gains and pose risks for retail investors. Some private market funds that are already available to wealthier individual investors have shown signs of strain in recent months. Private credit funds known as business development companies have seen a wave of withdrawals. Treasury Secretary Scott Bessent said the proposed rule was "an initial step" and aimed to be "mindful of the importance of protecting retirement assets."

The guidance lays out how plan trustees, who have a legal fiduciary duty to act in the best interest of members, can incorporate these assets. They would have to "objectively, thoroughly, and analytically consider, and make determinations on factors including performance, fees, liquidity, valuation, performance benchmarks, and complexity," the DOL said. Trustees who abide by them will be granted safe harbor that protects them from lawsuits, it added. The Supreme Court agreed earlier this year to hear one such case filed in 2019 by a former Intel employee claiming trustees made "imprudent" decisions by investing in hedge funds and private equity funds.

The Courts

Judge Allows BitTorrent Seeding Claims Against Meta, Despite Lawyers 'Lame Excuses' (torrentfreak.com) 9

An anonymous reader quotes a report from TorrentFreak: In an effort to gather material for its LLM training, Meta used BitTorrent to download pirated books from Anna's Archive and other shadow libraries. According to several authors, Meta facilitated the infringement of others by "seeding" these torrents. This week, the court granted the authors permission to add these claims to their complaint, despite openly scolding their counsel for "lame excuses" and "Meta bashing." [...] The judge acknowledged that the contributory infringement claim could and should have been added back in November 2024, when the authors amended their complaint to include the distribution claim. After all, both claims arise from the same factual allegations about Meta's torrenting activity.

"The lawyers for the named plaintiffs have no excuse for neglecting to add a contributory infringement claim based on these allegations back in November 2024," Judge Chhabria wrote. The lawyers of the book authors claimed that the delay was the result of newly produced evidence that had "crystallized" their understanding of Meta's uploading activity. However, that did not impress the judge. He called it a "lame excuse" and "a bunch of doubletalk," noting that if the missing discovery truly prevented the contributory claim from being added in November 2024, the same logic would have prevented the distribution claim from being added at that time as well. "Rather than blaming Meta for producing discovery late, the plaintiffs' lawyers should have been candid with the Court, explaining that they missed an issue in a case of first impression..," the order reads.

Judge Chhabria went further, noting that the authors' law firm, Boies Schiller, showed "an ongoing pattern" of distracting from its own mistakes by attacking Meta. He pointed specifically to the dispute over when Meta disclosed its fair use defense to the distribution claim, which we covered here recently, characterizing it as a false distraction. "The lawyers for the plaintiffs seem so intent on bashing Meta that they are unable to exercise proper judgment about how to represent the interests of their clients and the proposed class members," the order reads. Despite the criticism, Chhabria granted the motion. [...] For now, the case moves forward with a fourth amended complaint, three new loan-out companies added as named plaintiffs, and a growing list of BitTorrent-related claims for Judge Chhabria to resolve.

Social Networks

Will Social Media Change After YouTube and Meta's Court Defeat? (theverge.com) 54

Yes, this week YouTube and Meta were found negligent in a landmark case about social media addiction.

But "it's still far from certain what this defeat will change," argues The Verge's senior tech and policy editor, "and what the collateral damage could be." If these decisions survive appeal — which isn't certain — the direct outcome would be multimillion-dollar penalties. Depending on the outcome of several more "bellwether" cases in Los Angeles, a much larger group settlement could be reached down the road... For many activists, the overall goal is to make clear that lawsuits will keep piling up if companies don't change their business practices...

The best-case outcome of all this has been laid out by people like Julie Angwin, who wrote in The New York Times that companies should be pushed to change "toxic" features like infinite scrolling, beauty filters that encourage body dysmorphia, and algorithms that prioritize "shocking and crude" content. The worst-case scenario falls along the lines of a piece from Mike Masnick at Techdirt, who argued the rulings spell disaster for smaller social networks that could be sued for letting users post and see First Amendment-protected speech under a vague standard of harm. He noted that the New Mexico case hinged partly on arguing that Meta had harmed kids by providing end-to-end encryption in private messaging, creating an incentive to discontinue a feature that protects users' privacy — and indeed, Meta discontinued end-to-end encryption on Instagram earlier this month.

Blake Reid, a professor at Colorado Law, is more circumspect. "It's hard right now to forecast what's going to happen," Reid told The Verge in an interview. On Bluesky, he noted that companies will likely look for "cold, calculated" ways to avoid legal liability with the minimum possible disruption, not fundamentally rethink their business models. "There are obviously harms here and it's pretty important that the tort system clocked those harms" in the recent cases, he told The Verge. "It's just that what comes in the wake of them is less clear to me".

The article also includes this prediction from legal blogger/Section 230 export Eric Goldman. "There will be even stronger pushes to restrict or ban children from social media." Goldman argues "This hurts many subpopulations of minors, ranging from LGBTQ teens who will be isolated from communities that can help them navigate their identities to minors on the autism spectrum who can express themselves better online than they can in face-to-face conversations."
Media

AV1's Open, Royalty-Free Promise In Question As Dolby Sues Snapchat Over Codec (arstechnica.com) 44

An anonymous reader quotes a report from Ars Technica: AOMedia Video 1 (AV1) was invented by a group of technology companies to be an open, royalty-free alternative to other video codecs, like HEVC/H.265. But a lawsuit that Dolby Laboratories Inc. filed this week against Snap Inc. calls all that into question with claims of patent infringement. Numerous lawsuits are currently open in the US regarding the use of HEVC. Relevant patent holders, such as Nokia and InterDigital, have sued numerous hardware vendors and streaming service providers in pursuit of licensing fees for the use of patented technologies deemed essential to HEVC.

It's a touch rarer to see a lawsuit filed over the implementation of AV1. The Alliance for Open Media (AOMedia), whose members include Amazon, Apple, Google, Microsoft, Mozilla, and Netflix, says it developed AV1 "under a royalty-free patent policy (Alliance for Open Media Patent License 1.0)" and that the standard is "supported by high-quality reference implementations under a simple, permissive license (BSD 3-Clause Clear License)."

Yet, Dolby's lawsuit filed in the US District Court for the District of Delaware [PDF] alleges that AV1 leverages technologies that Dolby has patented and has not agreed to license for free and without receiving royalties. The filing reads: "[AOMedia] does not own all patents practiced by implementations of the AV1 codec. Rather, the AV1 specification was developed after many foundational video coding patents had already been filed, and AV1 incorporates technologies that are also present in HEVC. Those technologies are subject to existing third-party patent rights and associated licensing obligations." Dolby is seeking a jury trial, a declaration that Dolby isn't obligated to license the patents in questions under FRAND (fair, reasonable, and non-discriminatory) licensing obligations, and for the court to enjoin Snap from further "infringement."

The Courts

Judge Blocks Pentagon's Effort To 'Punish' Anthropic With Supply Chain Risk Label 82

An anonymous reader quotes a report from CNN: A federal judge in California has indefinitely blocked the Pentagon's effort to "punish" Anthropic by labeling it a supply chain risk and attempting to sever government ties with the AI company, ruling that those measures ran roughshod over its constitutional rights. "Nothing in the governing statute supports the Orwellian notion that an American company may be branded a potential adversary and saboteur of the U.S. for expressing disagreement with the government," US District Judge Rita Lin wrote in a stinging 43-page ruling.

Lin, an appointee of former President Joe Biden, said she would delay implementation of her ruling for one week to allow the government to appeal. But in her ruling, she made it clear she disapproved of the government's actions, which she said violated the company's First Amendment and due process rights. [...] "These broad measures do not appear to be directed at the government's stated national security interests," she wrote. "The Department of War's records show that it designated Anthropic as a supply chain risk because of its 'hostile manner through the press.'" "Punishing Anthropic for bringing public scrutiny to the government's contracting position is classic illegal First Amendment retaliation," she added.
"We're grateful to the court for moving swiftly, and pleased they agree Anthropic is likely to succeed on the merits," an Anthropic spokesperson said after the ruling. "While this case was necessary to protect Anthropic, our customers, and our partners, our focus remains on working productively with the government to ensure all Americans benefit from safe, reliable AI."
Cloud

Apple Gives FBI a User's Real Name Hidden Behind 'Hide My Email' Feature (404media.co) 90

An anonymous reader quotes a report from 404 Media: Apple provided the FBI with the real iCloud email address hidden behind Apple's 'Hide My Email' feature, which lets paying iCloud+ users generate anonymous email addresses, according to a recently filed court record. The move isn't surprising but still provides uncommon insight into what data is available to authorities regarding the Apple feature. The data was turned over during an investigation into a man who allegedly sent a threatening email to Alexis Wilkins, the girlfriend of FBI director Kash Patel.

"On or about February 28, 2026, Person 1 received an email from the email address peaty_terms_1o@icloud.com," the affidavit reads. Earlier on, the document explicitly says that Person 1 is Alexis Wilkins. [...] The affidavit says Apple then provided records that indicated the peaty_terms_1o@icloud.com email address was associated with an Apple account in the name of Alden Ruml. The records showed that account generated 134 anonymized email addresses, according to the affidavit.

Law enforcement agents later interviewed Ruml and he confirmed he had sent the email, the affidavit says. Ruml said he sent the email after reading a February 28 article about how the FBI was using its own resources to provide security to Wilkins. The specific article is not named or linked in the affidavit, but a New York Times article published that same day described how Patel ordered a team to ferry his girlfriend on errands and to events.

The Courts

Supreme Court Sides With Internet Provider In Copyright Fight Over Pirated Music 91

Longtime Slashdot reader JackSpratts writes: The Supreme Court unanimously said on Wednesday that a major internet provider could not be held liable for the piracy of thousands of songs online in a closely watched copyright clash. Music labels and publishers sued Cox Communications in 2018, saying the company had failed to cut off the internet connections of subscribers who had been repeatedly flagged for illegally downloading and distributing copyrighted music. At issue for the justices was whether providers like Cox could be held legally responsible and required to pay steep damages -- a billion dollars or more in Cox's case -- if they knew that customers were pirating music but did not take sufficient steps to terminate their internet access.

In its opinion released (PDF) on Wednesday, the court said a company was not liable for "merely providing a service to the general public with knowledge that it will be used by some to infringe copyrights." Writing for the court, Justice Clarence Thomas said a provider like Cox was liable "only if it intended that the provided service be used for infringement" and if it, for instance, "actively encourages infringement." Justice Sonia Sotomayor, joined by Justice Ketanji Brown Jackson, wrote separately to say that she agreed with the outcome but for different reasons. [...]
Cox called the court's unanimous decision a "decisive victory" for the industry and for Americans who "depend on reliable internet service."

"This opinion affirms that internet service providers are not copyright police and should not be held liable for the actions of their customers," the company said.
Facebook

Meta Loses Trial After Arguing Child Exploitation Was 'Inevitable' (arstechnica.com) 45

Meta lost a child safety trial in New Mexico after a court found that its platforms failed to adequately protect children from exploitation and misled parents about app safety. According to Ars Technica, the jury on Tuesday "deliberated for only one day before agreeing that Meta should pay $375 million in civil damages..." While the jury declined to impose the maximum penalty New Mexico sought, which could have cost the company $2.2 billion, Meta may still face additional financial penalties and could be forced to make changes to its apps. From the report: The trial followed a 2023 lawsuit filed by New Mexico Attorney General Raul Torrez after The Guardian published a two-year investigation exposing child sex trafficking markets on Facebook and Instagram. Torrez's office then conducted an undercover investigation codenamed "Operation MetaPhile," in which officers posed as children on Facebook, Instagram, and WhatsApp. The jury heard that these fake profiles were "simply inundated with images and targeted solicitations" from child abusers, Torrez told CNBC in 2024. Ultimately, three men were arrested amid the sting for attempting to use Meta's social networks to prey on children. At trial, Mark Zuckerberg and Instagram chief Adam Mosseri testified that "harms to children, such as sexual exploitation and detriments to mental health, were inevitable on the company's platforms due to their vast user bases," The Guardian reported. Internal messages and documents, as well as testimony from child safety experts within and outside the company, showed that Meta repeatedly ignored warnings and failed to fix platforms to protect kids, New Mexico's AG successfully argued.

Perhaps most troubling to the jury, law enforcement and the National Center for Missing and Exploited Children also testified that Meta's reporting of crimes to children on its apps -- including child sexual abuse materials (CSAM) -- was "deficient," The Guardian reported. Rather than make it easy to trace harms on its platforms, the jury learned from frustrated cops that Meta "generated high volumes of 'junk' reports by overly relying on AI to moderate its platforms." This made its reporting "useless" and "meant crimes could not be investigated," The Guardian reported.

Celebrating the win as a "historic victory," Torrez told CNBC that families had previously paid the price for "Meta's choice to put profits over kids' safety." "Meta executives knew their products harmed children, disregarded warnings from their own employees, and lied to the public about what they knew," Torrez said. "Today the jury joined families, educators, and child safety experts in saying enough is enough."
Meta said the company plans to appeal the verdict. "We respectfully disagree with the verdict and will appeal," Meta's spokesperson said. "We work hard to keep people safe on our platforms and are clear about the challenges of identifying and removing bad actors or harmful content. We will continue to defend ourselves vigorously, and we remain confident in our record of protecting teens online."
The Courts

Intuit Beats FTC In Court, Ending Restrictions On 'Free' TurboTax Ads (arstechnica.com) 59

An anonymous reader quotes a report from Ars Technica: An appeals court invalidated the Biden-era Federal Trade Commission's attempt to punish Intuit for allegedly deceptive ads that pitched TurboTax as free. Under then-Chair Lina Khan, the FTC determined in 2024 that the TurboTax maker violated US law with deceptive advertising and ordered it to stop telling consumers, without more obvious disclaimers, that TurboTax or other products are free. The FTC's chief administrative law judge had previously found that Intuit's ads violated prohibitions on deceptive advertising because the firm "advertised to consumers that they could file their taxes online for free using TurboTax, when in truth, for approximately two-thirds of taxpayers, the advertised claim was false."

Intuit appealed in the conservative-leaning US Court of Appeals for the 5th Circuit and got a resounding victory on Friday in a 3-0 ruling issued (PDF) by a panel of judges. "Following the Supreme Court's decision in SEC v. Jarkesy, we hold that adjudication of a deceptive advertising claim before an administrative law judge violated the constitutional separation of powers," the 5th Circuit panel said. The Supreme Court's June 2024 ruling (PDF) in Securities and Exchange Commission v. Jarkesy held that the SEC system for issuing fines violated the right to a jury trial. The 5th Circuit panel said the Jarkesy decision confirms that the FTC must pursue deceptive advertising claims in courts rather than its own administrative process. [...]

The 5th Circuit ruling acknowledged that most people can't use TurboTax for free. "TurboTax 'Free Edition' has been part of the TurboTax range for more than a decade, available to taxpayers for what Intuit refers to as 'simple tax returns,'" the ruling said. "Most American taxpayers do not have 'simple tax returns.' The TurboTax website is designed so that any individual taxpayer can begin preparing a tax return in TurboTax Free Edition, but those who enter disqualifying information are prompted before filing to upgrade to a paid product." Although the court noted that Intuit stopped the specific ads challenged by the FTC, the ruling said the cease-and-desist order issued by the agency could have far-reaching effects on Intuit marketing. "The cease-and-desist order is remarkably broad: it prohibits Intuit for the next twenty years from advertising 'any goods or services' as free unless specific, extensive, and arguably unworkable requirements are satisfied. The order is not confined to tax-preparation solutions and extends to all products sold by Intuit," the ruling said.

The 5th Circuit said the FTC's deceptive advertising claims are "traditional actions at law and equity and thus involve private rights that demand adjudication in an Article III court." The court rejected the FTC's argument that the claims involve public rights that may be adjudicated by administrative agencies. "In sum, there is overwhelming evidence that Section 5 of the FTC Act did not create a new duty for merchants to refrain from deceptive advertising," the 5th Circuit said. "That duty long predated the FTC Act and could be enforced by private parties in actions at common law or equity for fraud, deceit, or unfair competition."

Security

Cyberattack on a Car Breathalyzer Firm Leaves Drivers Stuck (wired.com) 118

Last week, hackers launched a cyberattack on an Iowa company called Intoxalock that left some drivers unable to start their court-mandated breathalyzer-equipped cars. Wired reports: Intoxalock, an automotive breathalyzer maker that says it's used daily by 150,000 drivers across the U.S., last week reported that it had been the target of a cyberattack, resulting in its "systems currently experiencing downtime," according to an announcement posted to its website. Meanwhile, drivers that use the breathalyzers have reported being stranded due to the devices' inability to connect to the company's services. "Our vehicles are giant paperweights right now through no fault of ours," one wrote on Reddit. "I'm being held accountable at work and feel completely helpless."

The lockouts appear to be the result of Intoxalock's breathalyzers needing periodic calibrations that require a connection to the company's servers. Drivers who are due for a calibration and can't perform one due to the company's downtime have been stuck, though the company now states on its website that it's offering 10-day extensions on those calibrations due to its cybersecurity disruption, as well as towing services in some cases. In the meantime, Intoxalock hasn't explained what sort of cyberattack it's facing or whether hackers have obtained any of the company's user data.

The Courts

Rapper Afroman Wins Defamation Lawsuit Over Use of Police Raid Footage In His Music Videos (billboard.com) 81

Longtime Slashdot reader UnknowingFool writes: Rapper Afroman, born Joseph Edgar Foreman, famous for his 2000 hit "Because I Got High", has won a defamation lawsuit that seven Ohio police offers filed against him. A jury found he did not defame the officers in music videos he made about a 2022 police raid of his home. In August 2022, Adams County Sheriff's Department raided Afroman's home on suspicion of drug trafficking and kidnapping. Neither drugs nor kidnapping victims were found, and charges were never filed. However, local officials would not pay for damages occurred during the raid including a broken front door and a video surveillance camera. Afroman used his home security footage of the raid to create music rap videos criticizing the police over the incident; "Will You Help Me Repair My Door?", "Why You Disconnecting My Video Camera?", and "Lemon Pound Cake". He posted the videos on YouTube.

In March 2023, seven officers filed a lawsuit against Afroman for invasion of privacy and the unauthorized use of their images from the security footage in addition to defamation claims. The officers requested an injunction for Afroman to stop speaking about them or using their photos. The officers also wanted all proceeds from the videos, song sales, performances, and merchandise claiming they had suffered "emotional distress" due to the videos. Afroman's defense included Freedom of Speech rights to criticize public officials. The ACLU filed an amicus brief supporting the rapper, arguing that the lawsuit was a SLAPP suit only meant to silence criticism. In October 2023, the court agreed and dismissed the invasion of privacy, "right of publicity", and "unauthorized use of individual's persona" claims but allowed the defamation case to proceed.

Defamation claims by the officers included the allegation Afroman repeatedly had sex with the wife of Randolph L. Walters, Jr. When Afroman's lawyer asked Walters "But we all know that's not true, right?", the officer replied he did not know. Defamation from emotional damages requires that harm arise from a false statement; however, if a statement is so outrageous that no one would believe it to be true, then reputational damage cannot be a result.

Piracy

Cloudflare Appeals Piracy Shield Fine, Hopes To Kill Italy's Site-Blocking Law (arstechnica.com) 25

Cloudflare is appealing a 14.2 million-euro fine from Italy for refusing to comply with its "Piracy Shield" law, which requires blocking access to websites on its 1.1.1.1 DNS service within 30 minutes. The company argues the system lacks oversight, risks widespread overblocking, and could undermine core Internet infrastructure. Ars Technica's Jon Brodkin reports: Piracy Shield is "a misguided Italian regulatory scheme designed to protect large rightsholder interests at the expense of the broader Internet," Cloudflare said in a blog post this week. "After Cloudflare resisted registering for Piracy Shield and challenged it in court, the Italian communications regulator, AGCOM, fined Cloudflare... We appealed that fine on March 8, and we continue to challenge the legality of Piracy Shield itself." Cloudflare called the fine of 14.2 million euros ($16.4 million) "staggering." AGCOM issued the penalty in January 2026, saying Cloudflare flouted requirements to disable DNS resolution of domain names and routing of traffic to IP addresses reported by copyright holders.

Cloudflare had previously resisted a blocking order it received in February 2025, arguing that it would require installing a filter on DNS requests that would raise latency and negatively affect DNS resolution for sites that aren't subject to the dispute over piracy. Cloudflare co-founder and CEO Matthew Prince said that censoring the 1.1.1.1 DNS resolver would force the firm "not just to censor the content in Italy but globally."

Piracy Shield was designed to combat pirated streams of live sports events, requiring network operators to block domain names and IP addresses within 30 minutes of receiving a copyright notification. Cloudflare said the fine should have been capped at 140,000 euros ($161,000), or 2 percent of its Italian earnings, but that "AGCOM calculated the fine based on our global revenue, resulting in a penalty nearly 100 times higher than the legal limit."

Despite its complaints about the size of the fine, Cloudflare said the principles at stake "are even larger" than the financial penalty. "Piracy Shield is an unsupervised electronic portal through which an unidentified set of Italian media companies can submit websites and IP addresses that online service providers registered with Piracy Shield are then required to block within 30 minutes," Cloudflare said.
Cloudflare is pushing for the law to be struck down, arguing that it is "incompatible with EU law, most notably the Digital Services Act (DSA), which requires that any content restriction be proportionate and subject to strict procedural safeguards."

In addition to appealing the fine, Cloudflare says it will continue to challenge Piracy Shield in Italian courts, engage with EU officials, and seek full access to AGCOM's Piracy Shield records.
The Courts

Arizona Charges Kalshi With Illegal Gambling Operation 65

Arizona has filed criminal charges against Kalshi, accusing it of operating an illegal gambling business. "Kalshi may brand itself as a 'prediction market,' but what it's actually doing is running an illegal gambling operation and taking bets on Arizona elections, both of which violate Arizona law," Arizona Attorney General Kris Mayes said in a statement. The case could ultimately head to the Supreme Court to decide whether federal oversight by the Commodity Futures Trading Commission overrides state gambling laws. Bloomberg reports: While state regulators have taken steps to crack down on what they say is unlicensed betting on Kalshi's site, Arizona appears to be the first state to escalate to criminal charges. The charges cited in the complaint are misdemeanors, which carry less serious penalties than felonies. [...] Prediction market exchanges like Kalshi have said they should continue to be regulated by the US Commodity Futures Trading Commission despite opposition from some state officials, who argue the trading should come under state gambling laws.

Arizona's criminal complaint follows Kalshi's move last week to block the state's gaming department from taking enforcement action against the company. "These are the first criminal charges of any kind filed against Kalshi in any court in the United States, but it will likely be the first of several," said Daniel Wallach, a sports and gaming attorney.

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