Innovation in technology is continuously providing us with new smart and intuitive devices to help make our lives simpler. With numerous companies running to get new products to market, a couple questions come to mind: Are all these companies keeping consumer security in mind when creating their products? How is the technology regulated for consumer security? There isn’t a clear-cut answer to either question. Yet, consumers are quick to buy and use products and software for a wide spectrum of fields, including devices that provide entertainment, make product purchases, inventory refrigerators, monitor babies, provide home security, and control medical devices; as well as new technologies for businesses, such as intelligence apps for legal research used by lawyers and business intelligence apps used by corporate executives. There is no question these are all great tools for simplifying life and enhancing productivity. The more technology evolves we can expect to encounter intelligent devices in use all around us. So, issues with consumer security, privacy, and regulation should be a valid concern.

In a recent case filed by the Federal Trade Commission against D-Link, accusations of lax security are made indicating consumers are placed at risk with unchangeable default logins and router vulnerabilities, as examples. D-Link, a Taiwanese router manufacturer, describes the lawsuit allegations as unwarranted and baseless. One might think the lawsuit is a sign the FTC is cracking down on security concerns around the Internet of Things (IoT). However, the FTC has historically tried to stay away from policing the IoT and with the recent appointment of Maureen Ohlhausen as acting chairwoman there could be less oversight by the FTC in matters concerning privacy and data security. Ohlhausen dissented to the FTC’s filing of the lawsuit against D-Link arguing a showing of tangible harm should be shown and indicating regulation should promote innovation in business and privacy.

In answer to FTC concerns, companies ask what the FTC considers “reasonable security measures” to be, but guidance has not been forthcoming and companies aren’t simply settling claims against the FTC, as typical. D-Link, like LabMD and Wyndham Worldwide Corp. have chosen to fight the claims against them. Perhaps more guidance will come from final decisions of consumer litigation disputes involving the IoT.

Other agencies taking a role in attempting to regulate the IoT are the Department of Homeland Security, National Institute of Standards and Technology, Federal Communications Commission, and the National Telecommunications and Information Administration (NTIA). Recently, the NTIA published a green paper about its role with regard to the IoT.

With rapid changes in technology creating ever-changing standards in best security practices, it would seem impossible for any agency to create and implement clear-cut guidelines for product manufacturers. With the IoT encompassing so many different kinds of devices for a myriad of uses, policy aimed at regulating the IoT is difficult at best.

Regardless of where the issues with consumer security fall and how the IoT is regulated, more intelligent devices will become part of our daily lives as consumers and businesses alike find them beneficial and rely on them for daily tasks.

For more information on this topic, please visit our IP and Commercial Litigation service page, which is part of our Business Litigation practice.

Klemchuk LLP is an Intellectual Property (IP), Technology, Internet, and Business law firm located in Dallas, TX.  The firm offers comprehensive legal services including litigation and enforcement of all forms of IP as well as registration and licensing of patents, trademarks, trade dress, and copyrights.  The firm also provides a wide range of technology, Internet, e-commerce, and business services including business planning, formation, and financing, mergers and acquisitions, business litigation, data privacy, and domain name dispute resolution.  Additional information about the commercial litigation law firm and its litigation attorneys may be found at www.klemchuk.com.

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