9th circuit expands border searches

The Volokh Conspiracy offers this great analysis of this 9th Circuit opinion today.  Basically, the court ruled that so long as an item seized at the border could have been searched at the border under the border search exception to the 4th amendment, the police can search it whenever and wherever they want without a warrant.

DC Circuit comes out with opinion on what constitutes membership in al Qaeda

In this opinion, Judge Kavanaugh said that even though the US government could not prove that a Guantanamo detainee was a member of al Qaeda (and therefore subject to being held in definitely under 2001's Authorization of the Use of Military Force) under the command structure test, his petition for habeas corpus must be denied.  The court says that each case must be analyzed on its on facts, without a firm standard.

Imagine that; you have to analyze the facts to determine if someone is a member of al Qaeda.  It was my understanding that is why we have jury trials, but having the DC Circuit as a fact finder should work as well.

JP Morgan Chase has to buy back mortgage backed securities

A lawsuit against a subsidiary which created a $666 million publicly offered bond backed by home equity lines of credit, now owned by JP Morgan Chase, by an insurer of mortgage backed securities can proceed.   The issue was that the Plaintiff only has evidence that a random sampling of mortgages included in the security were not conforming to the warranties of the bond creator.  Judge Crotty ruled that this statistical sampling was sufficient to allow the suit to continue.

I have at least one thing in common with the FTC...

...Google Buzz irritates me.  However, unlike the FTC I cannot force Google to submit to privacy audits for the next 20 years.  The FTC found that Google facebook knock-off Buzz's opt-out procedure was sufficiently opaque as to the amount of private data from Gmail accounts it shared, and is forcing the giant to submit to bi-annual audits to make sure it is complying with its own privacy standard.  Google issued this mea culpa.

This is also a big settlement for the FTC, which has been attempting to position itself a privacy watchdog, whether Congress tells them to or not..

Water bureau to pay for new Rose Festival headquarters

Portland's Water Bureau is set to spend $1.5 million of money from Portland residents to overhaul the Rose Festival's headquarters.  This is part of broader mission creep for the water and sewer people, who are also spending $2.5 million on "parks and planning, including $69K on enforcement of rules for dogs in parks (grumble).

The battle lines are being drawn for next year's elections on this issue.  Randy Leonard and Amanda Fritz are pretty much diametrically opposed on this issue and also up for re-election.

End of HAMP?

Yesterday, the House voted to end the HAMP program.  The vote basically broke along party lines, with Republicans, critical of the program's efficacy, voting to end the program.  In fairness, everyone except Obama and the treasury is critical of the program efficacy.

However, the vote begs the question; is an unequivocally lousy system for helping homeowners in foreclosure better than none at all?

Home prices down, especially in Portland

The S & P/Case-Shiller index of home prices for January 2011 for 20 cities came out today, and it shows a continued slide of home prices, as foreclosures stack up.  What is surprising is that Portland and Seattle are close to the top of the list in terms of declining home prices, even compared to cities which have been traditionally in the forefront of declines, like Detroit, Las Vegas, Los Angeles and Phoenix.  Portland home prices are at their lowest since January, 2005.  

Supreme Court is headed to the most important campaign finance decision since Citizen's United

The Supreme Court is going to rule on an Arizona law providing matching funds for certain political candidates.  We will likely see the Court strike this law down in June, using the same First Amendment logic we saw in Citizen's United.

Portland goes deeper into hock

Jack Bogdanski offers this thoughtful analysis of Portland's new bond issues.  Jack pretty much said everything that needs to be said on this, but it is worth pointing out that one of the bonds is simply going to pay off a line-of-credit from Bank of America to the city.  In other words, that money has already been spent on urban renewal projects or corporate hand-outs that, thus far, have not actually generated revenue for the city.  This the municipal equivalent of getting a second mortgage to pay off a credit card which you used for a vacation you already took.

Portland could find itself in real trouble on this type of issue if it the credit of its muni bonds are downgraded.  This hasn't happened yet, but it is possible.

Oregon Cannabis Tax Act, Mark II

Today the Oregon Cannabis Act campaign kicked off again to get the measure on the ballot in 2012.  The same measure narrowly missed the ballot in 2010.  Of course, making matters more complicated is the fact that three weeks ago, AG Kroger, friend of people, announced that Paul Stanford, director of The Hemp and Cannabis Foundation, the organization behind OCTA, was arrested for not filing personal income tax returns in '08 and '09.

Notwithstanding the tax problems of the founder, if passed the bill hopes to raise $140 million in tax revenue from taxing the sale of marijuana, and another $60 million in saved law enforcement costs by not jailing people on pot charges.

Victory for copyright trolls

Last week Judge Howell in DC, handed copyright trolls a big victory in their spamigation business model.  The Judge ruled that the reverse class action model is alright, at least provisionally, for copyright holders to use the subpoena process to identify individuals responsible for copyright infringement.  This has been the cause of much consternation in the bit torrent world.

However, the Judge's decision was probably correct on the issues presented to her.  It is important to remember that she is ruling in a case without any actual Defendant.  So, to the extent that the EFF and ACLU put forward arguments relating to personal jurisdiction and the first amendment, those will have to wait until one of these cowardly copyright trolls actually files a lawsuit against a real person.

Oregonian offers a great look at the proposed street car

The O offers this in depth look at the proposed street car linking Lake Oswego and downtown Portland.  April promises to be a big month for this project, as both the Lake O and Portland city councils will vote on the issue.  Opponents of the project living near the proposed line in Lake Oswego and Dunthorpe are well organized and not shy about spending money for what is largely a NIMBY issue for those involved.

Sam Adams touts the project as a way to build out John's Landing.  Homer Williams, one of the real estate masterminds of the Pearl and the South Waterfront, wants to build this new neighborhood near Lake O.  An interesting feature of this project is that it includes a $97 million price tag for the rail right of way the city paid $2 million for in 1988.  Of course, outside of the total cost, nearly half a billion dollars, the big question is, who will ride the thing.  Proponents state that as OHSU expands, this type of light rail would be helpful for connecting Lake O to the hospital, while critics point to the cost.

However, as the developers who stand to benefit from this project are pretty familiar faces, it seems likely that the city will find a way to make it happen.

Ashland considers making homelessness illegal

The Ashland City Council has figured out a solution to homelessness.  They can just fine homeless people for being in certain parts of the city.

How much does music downloading hurt the record industry

The London School of Economics just released this Media Policy Brief on the impact of file sharing on the music industry.  It criticizes the current regulatory framework for file sharing as protecting an outdated business model.  The issue for the recording industry is a complicated one, as the total revenue for the industry is in decline, but the availability of music to consumers is rising, and the purveyors of digital media players could not be happier.

The EFF offers this commentary.  The issue of profit sharing for digital music between artists and labels is also in play as some artists have claimed that selling a digital copy of a piece of music is a "license" not a "sale".  Eminem just prevailed on a lawsuit of this issue.  That lawsuit has far reaching consequences for many artists, as it stands for the proposition that artists should get a much higher percentage of the revenue from digital music sales.

So, the question remains, will people stop downloading music, or will the music industry figure out how to profit from it?

Overpaying for a picture of a buffalo

The Wall Street Journal offers this article about a New Mexico lawsuit by Gateway co-founder Norman Waitt and Gerald Peters, an art dealer.  The suit alleges that Peters sold Waitt a Samuel Seymour painting called "Buffalo Standing in a River" for about six times its actual market value.  The defense is that Waitt just has buyer's remorse, and that the market for the painting went away during the recession.

Mr. Peters claims that the art was priced fairly and that Mr. Waitt had his "art assistant" with him when he made the purchase.  The case, which is filed as breach of contract, negligent misrepresentation and consumer protection claim leads to some interesting questions.  Waitt has not alleged that Peters lied about the authenticity or title to the art, so the case is strictly about if the sale was "fair".  Do galleries have a special duty to their clients to value pieces fairly, or should a buyer of a million plus dollar piece of art be assumed to be sophisticated enough to determine the value of the piece on their own?

9th circuit puts brakes on resumption of gay marriage in CA

The 9th circuit declined to allow gay marriages to resume during the appeal of the district court's decision overturning the law banning gay marriage.  It could be a year before the 9th circuit renders as opinion, as they are waiting on the CA Supreme Court to render an opinion regarding whether the Plaintiffs have standing to challenge the law.

Oregon extends unemployment benefits

The governor will sign law extending unemployment benefits in the state for another 20 weeks.

Civil rights lawsuit filed in Portland today

The good folks at the Portland Law Collective filed this lawsuit today.  The Oregonian carried a story with a video of the incident, which is pretty damning.  Of course, there are no easy victories in the civil rights arena, and it is expected that the union will circle the wagons around the officers in the video.

David Bowie album available on bit torrent only

Although not by permission of Mr. Stardust, himself.  Torrentfreak offers this great story of how a dedicated bt user and David Bowie sabotaged for profit bootleggers by making the album, which record execs refused to release, available for free on-line.

Better wait to file online in Oregon

Turbo Tax has still not updated its program to include certain deductions for Oregon teachers and college tuition payers.  Umm, its already the end of March guys...

Freddie says no more MERS foreclosures

Freddie Mac has announced that its servicers can no longer foreclose on houses in the name of MERS.  Oregon law already prevents this, but it is nice to see Freddie saying that it will follow the law on foreclosures.

Another mortgage rate increase

30 year mortgage rates increased again this month.  They are still very low, but even record lows in November did not help the housing market.

Parking hike for MLS games at PGE Park

Jack Bogdanski caught this one.  The city is going to charge $3.50 an hour to park around PGE park during MLS games.  Commissioner Leonard thought that $7 an hour was more reasonable.

Follow-up on Orphan Works

As follow-up to Tuesday's post regarding the dismissal of the class action settlement in the Author's Guild v. Google case in New York, the EFF has offered this interesting piece on some proposed orphaned work legislation.

It seems unlikely that Congress will address this, or any other legislation aimed at a more user friendly copyright regime in the US, but kudos to the EFF for raising the banner.

'dis a big business, natty

The medical marijuana industry will do $1.7 billion in sales this year.  If only we could tax that somehow...

Lloyd Blankfein testifies at Raj Rajaratnam securities fraud trial

Lloyd Blankfein, the embattled CEO of Goldman Sachs, testified for the prosecution today in Raj Rajaratnam's insider trading trial.  The issue is whether Goldman Sachs board member Rajiv Gupta told Rajaratnam confidential information regarding the $5 billion capital infusion from Warren Buffet, which saved Goldman Sach's and information regarding Goldman Sach's acquisition of a commercial bank or insurance company.  The government has a tape of a conversation between Gupta and Rajaratnam regarding these issues.

Rajaratnam, whose hedge fund, Galleon Trading, made about $45 million as the economy was crashing, has stated that his trades were made based on publicly available information.  The trial will conclude in about two months.

New data on February home sales

Reuters offers this report on February home sale data, and it is bleak.  Total sales and average prices are at record lows.  The industry is left to debate whether or not this represents a new housing market contraction or a failure to recover from the last contraction.

Yeon building finally sold

Portland's historic Yeon Building, which has been languishing since the owners of the building went through a bankruptcy in late 2009 (lately, it has been 50% unoccupied) has been purchased by a New York real estate firm.  The major tenant, in my mind, is Portland's Metropolitan Public Defenders, one of Portland's main public defense outfits.

The purchaser, Jonathan Rose Companies, LLC, has bold plans for the building, including getting it LEED Certified as a green building.  The same company has also purchased a large apartment complex in Goose Hollow, and is clearly making inroads to the currently depressed Portland commercial real estate market.

Was Zipcar actually your idea?

Well, the Oregon House wants to let you go ahead and start your own car sharing program.  Bike Portland reports.  We'll see how it does in the Senate.

Important digital books ruling in Federal court in New York

The EFF reports on its blog that Judge Denny Chin in NY has rejected a settlement agreement between the Authors Guild and Google in this decision.  This is a very complicated class action suit wherein The Author's Guild represents the class of people who own copyrights of printed books.  The EFF objected to the settlement because of privacy concerns for how Google will track what people are reading.

However, Microsoft and Amazon objected based on anti-trust concerns, that the settlement would effectively give Google the rights to all unclaimed works.  The court found this logic persuasive.  This is because the settlement required the owners of books to simply notify Google that Google had digitized their book, and Google would cut them a check, as low as $60.00.  Judge Chin noted that he would consider a settlement wherein the current opt out system was replaced by an opt in system.  Since Google has, in fact, already digitized a massive quantity of books, it is not clear what the opt in system would look like.

Amazon, who has an opt in policy for the Kindle consisting of a revenue split between Amazon and the rights holder, would be at an obvious disadvantage if Google could just digitize a book and pay an author after the fact.  However, Google's quest to make all books available for everyone is also compelling.  Obviously, this fight is far from over.

Los Angeles Federal immigration attorney gets 18 years for taking bribes

An LA immigration attorney was sentenced to 18 years in prison for taking bribes from illegal immigrants to let them stay in the country.  Apparently he netted over $400K.  Which actually isn't that much considering that he is an attorney for the federal government.  I can't figure out why someone making a salary in the low six figures plus benefits would need little bribes on top of that.

He got busted for taking $20K from a government witness in a casino.  It doesn't take a brain trust to figure out that if you are taking an envelope full of cash from someone as a bribe, you probably want to go somewhere without cameras everywhere.

CA now considering going after individual online shoppers for sales tax

Forbes reports that California is considering hiring private investigators to find out what individuals spent more than $5K on the internet without paying a sales tax (more accurately, a use tax).  While California is prohibited from going after retailers for this money, there is nothing stopping them from going after individuals who owe the tax.

Generally speaking, what stops states from doing this is not the lack of legal authority to do it, but the lack of a financial reason to do it.  After all someone who spends $5K online owes about $300.00 in sales tax in California, so it is not clear that it is worth the state's money (estimated $7-10 million) to hire PI's to track these folks down.

Portland's new gun control laws

In response to the recent spat of gang related shootings, Sam Adams has been publicly supporting Portland's anti-gun non-profits.  In December, the city also enacted five anti-gun ordinances, mostly aimed at youth offenders and adults who allow youths to have gunes.  Of course, the state legislature in Salem is heading the opposite direction, with numerous bills aimed at making concealed carry much easier.

Especially interesting in the context of Portland's new gun ordinances, is HB 2793 which would modify the definition of "public places" as used in the recently enacted Portland ordinances, making them more difficult to enforce, specifically making it so that a gun inside a vehicle can never be considered to be "in a public place".  Most of these measures have been introduced by Republican representative Kim Thatcher from Newberg, who is a celebrated gun honk.  It is not clear that the representative from Newberg has any interest in a solution to Portland's growing gang problem, but rather wants to use the issue as a pulpit to preach the no gun control gospel.

Great deposition transcript

Here is a great transcript of the head of IT for Cuyahoga County (where Cleveland, OH is located) explaining that why he cannot answer the question of whether or not his office has a photocopy machine.

Definitely worth a chuckle.

Is it a violation of your civil rights for a government agent to perjure himself against you?

The Supreme Court will address this question.  The 11th Circuit found that a district attorney is entitled to absolute immunity for anything the DA does relating to his or her job in court, included perjuring themselves to a grand jury.

Should be an interesting fight.

King neighborhood business owners and PDC at odds over Vanport development

Vanport square business owners are voicing their opposition to PDC plans to redevelop the square.  The basic complaint is that the PDC is taking prime real estate on MLK for its pet projects, including a Trader Joes or 24 hour Fitness, a row of townhouses, and a surgerical rehabilitation center without delivering on its promise that these developments will increase foot traffic in the area.

Additionally, it is not clear that there is a market for the townhouses, which is also slowing down the project.  This project could be part of the mayor's initiative, through the PDC, to bring upscale grocery stores to neighborhoods that don't have them as a part of the city's urban renewal goals.  However, as local business owners opine, it is unlikely that a Trader Joes, a surgical facility, and some vacant townhomes, will cause more foot traffic to move to Vanport Square.

I question whether the PDC really has the best interests of existing business owners in mind for this project, or whether this is just an attempt to gentrify Alberta all the way west to MLK, at the expense of local businesses like the Horn of Africa and Old Town Pizza, which has existed in that neighborhood for years.

CRC debate heats up

Sam Adams sent this letter to Governor Kitzhaber last week asking the governor to support the cable stayed bridge for the Columbia River Crossing.  The city of Vancouver also backs the cable stayed design.  However, money is an issue, and with the project having already cost $118 million, and the total price tag being $3.6 billion, although critics claim it could be 3 times that much.

Basically the only arguments for the other design, a truss bridge like the Marquam bridge are that it will save $50-60 million and will not require FAA approval, like the cable stayed bridge.  The final decision rests with the governor, although the mayor is not shy about voicing his preference for the cable stayed bridge, and the city is funding the group responsible for lobbying for the cable stayed design.  What the public wants is, at best, unclear.

Last week, Jeff Jahn, at PORT, offered this explanation of the serious design problems with the truss deck option.  In any event, it is not clear what the governor will do, and there are strong opinions on both sides.

.xxx domain ready to go

Internet porn just got a little easier to identify.  The .xxx domain has been approved by ICANN.

Grim news regarding home sales

Home sales are down 9.6% from last month and 3% from last year, according to the National Association of Realtors.  The national median home sale price is down 5% from last year, and a record 33% of all home sales were cash sales, ie homes purchased in foreclosure sales.

The general consensus is that these numbers are due to less credit being generally available to consumer for mortgages, allowing investors who have cash to come in and snap up homes at very low prices.  As interest rates climb, and the government continues to be reticent to subsidize home mortgages, this trend will likely continue in the near future.

Supreme Court turns down hearing on FOIA request on Fed

The Supreme Court today declined to hear a case where the Federal Reserve Bank wanted the Court to overturn an order under the Freedom of Information Act for the Fed to turn over information about which commercial banks received emergency loans from the Fed's discount window during the economic crisis.

This means the 2nd Circuit's order to turn this information over stands, and the Fed will have to release it.

Will the Supreme Court weigh in on warrantless GPS tracking?

A decision out of the DC Circuit Court reversing a conviction obtained with evidence garnered from the use of a GPS tracking device on a suspect's car, which was placed without a warrant, is likely to be considered by the Supreme Court.  The feds had a warrant for the GPS tracking device on the Defendant, which subsequently expired, but they continued to use the device.  This issue, whether the police can unilaterally use a GPS device to track all movements of suspect, is a very important one, so the EFF and ACLU have weighed in.

The New York State high court, using a 1983 US Supreme Court decision regarding tracking using a beeper, found that GPS tracking requires a warrant.  The Ninth Circuit Court of Appeals found that the use of GPS tracking device to track a vehicle on public roads without a warrant was OK, so long as the placement of the device did not violate the 4th Amendment.  The Supreme Court will need to make a decision hear, because older Supreme Court decisions, regarding so-called bird-dogging devices (pagers) and thermal imaging, simply do not reflect changes in technology that allow for much more detailed tracking today.

Big Box stores want Amazon taxed

The WSJ offers this in depth report.  Amazon has successfully dodged the sales tax bullet by not having a brick and mortar presence anywhere.  Sen. Mike Enzi from Wyoming has been carrying this torch since 2007 when he began advocating for a national sales tax database which would administer state sales tax for out of state purchases (this is technically called a "use tax").  Ostensibly the purpose of this type of legislation is to prevent governments in states with sales tax (not Oregon) from allowing on-line retailers a competitive advantage over brick and mortar retailers.  The fear is that setting up a system where the feds are collecting sales tax for the states would make it easier for the feds to institute a federal sales tax, which is not very popular.

Amazon points to the Internet Tax Freedom Act as preventing a national sales tax on the internet.  This is really not the case, except it may prevent a tax from being assessed on things like Kindle purchases.  Amazon is still actively fighting any effort to make its transactions with consumers subject to a sales or use tax.  It is probably a losing battle, as many states, and Mike Enzi, are keeping after it.

Feds raid Montana Dispensaries

Feds this week raided Medical Marijuana Dispensaries in Montana.  That it exactly what Obama said they would not do.  In their defense for the Montana raids, they are claiming that the dispensaries were actually a front for illegal operations.

Oregon Senate Bill to allow folks to sue insurance companies for unlawful trade practices

Currently, insurance companies are exempt from the Unlawful Trade Practices Act, which basically prevents merchants from cheating people (writ large).  Support for this bill included testimony from Representative Clem's mother-in-law about the five year battle she had with Blue Cross Blue Shield to convince them that she was not dead and that they should pay her medical bills.  Of course the relatively short statute of limitations (one year) for UTPA violations would have probably prevented redress under the law for this situation, but it is a step in the right direction.

Decision from the 7th Circuit on Iraq war protests in Chicago

The venerable Judge Posner delivered this opinion today reversing a district court judge who dismissed a civil rights lawsuit by 900 people who were arrested in Chicago during a protest on the day the Iraq war started.  The issue basically distills to whether or not the police are allowed to arrest people en masse when they decide they no longer want to tolerate an unpermitted march which had been previously tolerated.

Interesting Judge Posner refers to the policy of Chicago to not issue permits for a march when the date of the parade is not known as "idiocy", although probably all cities have this policy.  His decision basically turned on that issue, since the protesters had no way of getting a permit, since they did not know the day the war would start, and the police initially allowed the protest to occur, the mass arrest was not appropriate.

Breaking news: liquor stores open in Oregon

The Oregonian would like to remind you that even though today is a state worker furlough day, the liquor stores are open.  Damn right.

Also open are the jails, so keep that in mind during your trip to the liquor store.

Big dismissal in spamigation bit torrent suits

Thanks, Rob Cashman, for posting this one.  This does not mean that the folks at Dunlap, Grubb and Weaver, a DC law firm that is carrying the spamigation torch are giving up the ghost, it just means that they won't get any names from the big lawsuits they have filed in DC that they do not already have.  They keep threatening to pursue people in the jurisdiction in which they live, but they have not done so yet.

Law school is not the "sure bet" it once was

According to the WSJ the number of law school applicants has dropped to its lowest level since 2001.  However, even though the total numbers are dropping, anecdotally the caliber of applicants is rising.  Most lawyers are broke.  Don't go to law school.

Scott Westerman still catching flack for road rage

Noted PPB crazy person Scott Westerman has been placed on administrative leave during the rest of investigation regarding a couple road rage incidents last winter involving the same couple.  There is something that is not quite right about the actual story underlying the charges.  I expect there are facts we don't know yet.

Derrick McGavic shut down by Kroger

Thanks, Erin Fitzgerald, for the head's up on this one.  John Kroger shut down the office of Derrick McGavic, one of the largest debt collection law firms in Oregon for "systematically ignoring debtor protections and rights afforded under the Oregon and Federal Debt Collection Protection Acts."  After representing countless clients against this firm over the years, I wholeheartedly agree.


Aggressive, illegal, tactics by debt collectors and their attorneys are increasingly common as consumer defaults on unsecured debts pile on.  Even the Wall Street Journal finds some of their practices questionable.  There is a growing legal backlash against these companies, as Midland Funding and their law firm Mann Bracken were forced to drop 10,000 cases in a Maryland class action.  Mann Bracken, previously a rival of Derrick McGavic shut down in 2010.  The FTC recently dinged debt collector West Asset Management for $2.8 million civil penalty for FDCPA violations.  The tide may be turning on debt collectors.  Nobody likes the man in the black hat, and it is easy points for aspiring politicians to come down on them.


Derrick McGavic's office handled collection for many large debt collection agencies in Oregon.  It is not clear at this time who will pick up the torch.

Step in the right direction for Paramount

Paramount will use bit torrent to distribute a movie legally.

DHS Senior Division leader replaced

The Oregonian reports that two high level administrators at DHS are off the job now, having been unable to account for $24 million in federal funds.

Sen. Chuck Grassley wants non-profits treated as expenditures

Sen. Grassley, ostensibly interested in the reigning some for fee activities of non-profits, wants the cost of not taxing tax exempt entities to be treated as an expenditure of the federal government.  This is apparently different from tax exemptions for large estates, which Grassley favors.

IRS creating problems for CA dispensaries

Section 280E of the internal revenue code states that:

No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.

And the IRS has been using this provision to prevent marijuana dispensaries from taking business expense deductions, including preventing them from taking deductions for the cost of goods sold.  The US Tax Court in 2007 decided that selling medical marijuana in a legal dispensary constitutes trafficking a controlled substance under this statute, but that businesses can still take deductions which are related to the actual sale of marijuana.  

The one thing about music...

... is that you can use it steal someone's car.  Check out this article on how to use an .mp3 to hack a car.

Court of Appeals say Tri-Met must allow political ads

In a decision today the Oregon Court of Appeals says that Tri-Met cannot restrict ads to commercial purposes. At issue in this particular case is an ad opposing more dams on the Klamath.  The Appeals Court agrees with Judge Breithaupt that Article 1, Section 8 of the Oregon Constitution (our state free speech clause) prohibits this type of distinction in speech by a government agency.

Alaska's Joe Miller may have ties to Alaska militia

Salon reports.  Apparently Joe Miller, noted Alaskan tea party member, is an associate of the leader of these five bozos who have been indicted for a conspiracy to assassinate a federal judge because one of them owes $166,000.00 in back taxes.

Luckily for Mr. Miller, this heavily armed group who advocate armed insurrection against the US Government and have threatened the life of a federal judge and his family due the imposition of an income tax are not Muslim, so no one will accuse him of cavorting with terrorists.

US drones flying in Mexico

The US has sent drones into Mexico to assist in fighting the Drug War.  This is one those slippery slope type deals.  It is easy to send military assistance to Mexico to fight the drug war.  Sounds great.  But it gets a lot more complicated when you see that the opposition we are now fighting against are armed with American weapons.

Furthermore, the war itself is the result of a failed American policy.  Finally, what happens when we start killing and injuring Mexican civilians who have nothing to do with the conflict, which is an inevitable by-product of drone attacks?  With the Obama administration, especially Joe Biden, unwilling to treat the drug problem as a health problem, and stepped up rhetoric about "our" war in Mexico, it seems likely that we are going to see more, not less, violence in Mexico.

Times are tough, even at the PDC

The PDC laid off 17 workers this morning, as part of their lowered budget for FY 2012.

Idaho latest state to push 20 week abortion laws

Our neighbor to the east is the latest state to jump on Nebraska's band wagon for prohibiting abortions after 20 weeks because that is when a fetus can feel pain.  Whether or not this reasoning is supported by facts is debatable.  However, I am not holding my breath for facts to get in the way of abortion legislation.

EFF files amicus brief in an odd new copyright troll suit

The Electronic Frontier Foundation has filed an amicus brief in a copyright troll lawsuit which is calling itself a "reverse class-action" suit.  Of course, it is highly unlikely the judge will let this fly, as there is no such thing as a reverse class-action suit.  However, if for some reason it is allowed to happen, it could be terrible for internet users everywhere.

Thanks, EFF, as always, for fighting the good fight.

SEC going after Freddie?

The New York Times reports.  This is not exactly robbing Peter to pay Paul, because the SEC wants to go after the CEO's of Freddie and Fannie personally.  The case appears to turn on how the phrase "subprime" is defined in relation to crappy mortgages.  It turns out, this is not as easy as it appears.  There are some inherent trappings of a subprime loan (no documentation of borrower income, low borrower credit), Yuliya Demyanyk explains that these loans are not so easy to categorize, and their rate of default does not necessarily line up with the housing crash.  And, of course, the elephant in the room when discussing the causes of the subprime crash is the lack of regulation of the financial services industry, as Joseph Stiglitz explains.

While the question of who should have disclosed what to whom and when is interesting, especially in the context of Freddie and Fannie, it does not answer the question of what to do now.  Freddie and Fannie are hemorrhaging taxpayer money.  There is no indication that Freddie and Fannie will ever be in a position to repay the bailout money spent on them, and Fed Chief Tim Geithner wants to see the companies wound down.  However this could add an additional $5 trillion in debt to the US Government if it occurs.

There does not appear to be a good solution to this problem, and while everyone will enjoy a public flogging of the individuals ostensible responsible for their failures; that is not a solution.

CA Lawyer cited for advising clients to break into their (former) homes

So reports Eugene Volokh.  Michael T. Pines of Encinitas has, according to the State Bar, been using his law license to drum up media circuses around his foreclosure practices featuring highly public client re-entries into foreclosed homes.  The Bar's position is that by advising clients to re-enter their homes when they actually have no legal to do so, Mr. Pines poses a substantial threat of harm to the public.

Louis Vuitton does not want its purses in your art

Designer Louis Vitton has obtained an ex parte court order preventing Nadia Plesner from exhibiting a piece of art work with a handbag resembling a Louis Vuitton handbag.  Regardless of whatever statement Ms. Plesner is trying to make about poverty and the civil war in Darfur, LV wants its coin...  Again.  For what its worth (not much), I could not have identified that handbag as an Louis V, and Anonymous is pissed, which means hilarity may ensue.

Louis Vitton's troubles with people using their intellectual property for free have been well documented, going all the back to noted culture observer Sir Mix-a-Lot's take on the issue.

Should Cristian Gheorghiu be allowed to profit from his tags?

The City of LA says no.  The City is seeking an injunction preventing Gheorghiu from profiting from any artwork that consists of things adjudicated to be illegal, like this and this.  Of course, it does add a little cache to his outlaw persona, even if it lightens his pocket book.  

DEA seizes lethal injection drugs headed for Georgia

AP reports that the DEA has questions about how the state got the drugs.  It might be dangerous.

New idea to stop internet piracy - stop people from using the internet

The House Judiciary Committee is hearing testimony about what to do about internet piracy.  Daniel Castro of Information Technology and Information Foundation proposed caps on data usage as a method of stopping piracy.

This makes perfect sense as long as you assume that there is no legitimate reason why people would want to get data using the internet.

Netflix is a behemoth

Netflix controls 61% of all directly delivered digital movies.  The second best?  Comcast at 8%.  This is huge and not just for Netflix.  As Netflix is realizing that subscription based business models beat sale based models any of the month, Amazon is trying to get in the game.

Meanwhile, the first serious non-industry study of actual numbers behind media piracy have come out.  The conclusion can basically be summarized as "deliver more to consumers for less".  The point of these developments is that movie producers are pissing into the wind when they try to sue people into not using media distribution systems which already exist and are accessible.  The real goal needs to be to capitalize on new methods of distribution and figure out pricing which makes sense in today's economy.  Or they can keep hiring the country's scummiest lawyers to sue their own customers while Netflix continues to clean their clocks.

Sir, step away from that couch, I'm going to need to see your license

The fair city of Beaverton has been conducting a sting operation to catch movers operating professionally without a license.  This is a Class A Violation, carrying a $472.00 fine.

Of course, it is better to use a licensed mover than not, as the law requires that a licensed mover have at least $10K in insurance for breaking your stuff (so you may want to double check the insurance for your movers who are moving your priceless Ming Vases).

Nonetheless, a joint sting operating between ODOT and the Beaverton Police to write tickets to unlicensed movers seems a little excessive.

Paris Hilton sex tape subject of new spamigation lawsuit

Torrentfreak reports that the XPays, who is apparently the owner of the Paris Hilton sex tape "One Night in Paris", has started discovery in its John Doe lawsuit.  For a mere price of $500.00 you can avoid being exposed as someone who watched the Paris Hilton sex tape.  AVN has an interview with XPays founder Evan Horowitz here, which is an interesting read on how one goes from being a Berkley grad to scum sucking porn industry bottom feeder in fewer than 7 years.

In case you are worried that XPays is really an innocent party here, Microsoft disagrees, having sued the company for sending spam e-mails which clogged MS servers in 2003.  Well, apparently, we live in a world where a company who engages in massive spam e-mail campaigns promoting porn sites can now sue you for downloading a celebrity sex tape from the internet.

Lufthansa and Virgin drop the dime on price fixing scheme

The DOJ fined 21 airlines and sent 4 executives to jail for a price-fixing scheme for airline surcharges which violates US anti-trust laws.  They would have gotten away with it too, if it weren't for those meddling kids (actually it was Lufthansa and Virgin, who brought details of the scheme forward in exchange for not being penalized).

Saxon under DOJ investigation for illegal foreclosures

You are not allowed to foreclose a home when the owner is a service member who is deployed overseas.  Apparently, Saxon did  not know this.

Judge in Illinois throws out file sharing case

A Judge in Illinois read the riot act to attorney John Steele, one of the sleaziest attorneys pursuing spamigation cases for people who allegedly used bit torrent to steal porn movies.  Basically the Judge felt that Mr. Steele lied to him when he certified that this particular case, where the copyright holder resides in Arizona, had anything to do with Illinois.

A little free advice for Mr. Steele, when the court asks you to show up for a hearing on why he shouldn't dismiss your lawsuit for the second time, try to show up on time.

Proposed changed to restraining order statute

The Oregon Senate is considering this law, which would allow a judge to make an order protecting any animals of the parties when they find that a restraining order is necessary because of domestic violence.

Judge Maurer speaks at the law school

The Oregonian has a link to a 51 minute speech Judge Maurer of Clackamas County gave to the law school at Lewis and Clark regarding the Followers of Christ cases.

Developments in the Pirate Bay criminal charges

A Swedish Court of Appeals held up the conviction of three of the founders of popular bit torrent site, the pirate bay. The fourth was unable to attend the hearing for medical reasons, and it will be set over.  In addition to jail sentences from 4-10 months (and, hey, how bad can Swedish Prison be?) they are collectively assessed $6.5 million in damages to various copyright holders.

The interesting part of this drama is what will become of The Pirate Bay, which is currently down.  According to the four individuals charged in this crime, they have no connections to the site any more, having sold it to Reservella, a company from Seychelles, known as a tax haven.  Dutch anti-piracy group BREIN has claimed that Reservella is owned by one of the founders of The Pirate Bay, and cites this credit report as evidence.   The veracity of that report is disputed.

New Contract for Portland Teachers

The teachers got a new contract through 2013.  No cost of living increases (you and me both, buddy), but some not insubstantial pay raises for more experienced teachers.  The full text of the contract is here.  The city saved nearly $3 million on the deal.

Still, Portland is doing better than our neighbors in Beaverton, where they are faced with a new tax levy or cutting $33 million out of their budget for schools and all of the negativity that engenders.  That makes the $75K that Beaverton schools had to pay out to Seth Stambaugh for firing Mr. Stambaugh for telling his students he is gay seem paltry.

Another sweetheart deal to political insiders from the PDC

Thanks again, Jack, for pointing this out.  All politics is local, and Portland is no exception.  While I am sure that hiring a deputy director with an evolving role at $135K per year is truly indispensable maybe the PDC should focus some energy on actually getting paid back on some of its loans.

Of course the $135K give away to someone on the mayor's staff seems paltry when you actually examine the  PDC's budget.  This is a somewhat scary picture.  The majority of the PDC's funding comes from the city ($113 million of $183 million for this fiscal year).  While the PDC claims this amount is in decline, it is representing an increasingly larger percentage of the PDC's total budget.  This is occurring while the PDC's income from actual property investment and development (interest on investments, loan collections, and property income) are all decreasing.

Of course, the PDC will point to the fact their investments create jobs and increase property value.  However, with a yearly administrative overhead of $17 million, it is easy to imagine alternative investments with the taxpayer's money which would provide similar modest increases in those areas with decreased costs.

Oregon Historical Society still in trouble

D.K. Row, of the Oregonian, offers this insightful piece on the continuing woes of the Oregon Historical Society.  Despite having been granted a generous $12 Million levy by Multnomah voters in the fall, it is not clear that the museum and library are in any better financial footing than they were before the vote.  This is because OHS agreed to allow all Multnomah County residents in to the museum for free during the five years the levy is in place.

Political insider Kerry Tymchuk will take over the reigns at the OHS as of April.  He has indicated that other cost cutting measures may need to be implemented, including selling part of the choice real estate that the museum occupies downtown.

Not alone in foreclosure

The pathetically terrible Oakland Raider's quarterback, JaMarcus Russell, is losing his house to foreclosure.  See, it really can happen to anyone, even someone who got a $60 Million contract to basically do nothing.

Interesting copyright case granted cert today

Golan v. Holder was granted cert by the Supreme Court today.  The Supremes will rule on whether Congress has the power to take a work out of the public domain.

Some banks halting Oregon foreclosures

The Oregonian reports that hundreds of foreclosures in Oregon are being halted due to problems with recording trust deeds for mortgages.  This is going to become the rule rather than exception moving forward, as apparently the banks were wrong when they decided that they did not need to follow Oregon's laws on recording trust deeds.

Boehner is going to defend DOMA if Obama Won't

John Boehner said on Friday that he would attempt to form an organization within the house of representatives with the goal of defending the Constitutionality of the Defense of Marriage Act in the Courts.  Obama had previously said the executive branch would no longer defend the act.

There is some question as to whether Obama is allowed to not defend DOMA.  It seems as though he is, if for no other reason than "who can make him?".  There is some precedence for his refusal to do so.  Likewise, it does not appear that anyone can stop the house from defending the bill, if they'd like, and there is some statutory authority for this.

Open Air Pot Market Debuts in Seattle

The Seattle Times reports.  This market is geared to medical marijuana users.  Additionally, this month the Washington State House introduced a bill to legalize marijuana and sell it in liquor stores.  This bill has broad based support, at least in the Seattle area, but the Office of National Drug Control Policy has come out against it.  

Notwithstanding the federal government's intractableness on this issue, these developments in Washington highlight the tensions between the two different paths to legalization.  The major difference between treating marijuana as medicine and distributing it through doctors and pharmacies and by legalizing it as a recreational, but tolerable, drug is that there is not any real possibility of generating revenue from medical marijuana.  Washington may be an experiment in how the two systems could co-exist.

Phenomenal 9th Circuit FDCPA Decision

A decision got handed down today regarding the Fair Debt Collection Practices Act.  This decision clears up some ambiguity in the law relating to whether filing a lawsuit to collect a debt that it is outside of the statute of limitations falls into the "bona fide error" exception to the FDCPA (if a debt collector violates the act, they can argue that their violation was not in bad faith using this exception).

The court decided in order to use this exception if a law firm files an action to collect a debt for a debt collector outside of the statute of limitations, that law firm must demonstrate that it did its own analysis to determine whether or not the debt was within the statute of limitations.  This seems like a no-brainer, but it isn't, and this is a great victory for consumers.

I believe this qualifies as breaching the peace...

The law in most states is that if a creditor with a security interest in a piece of property wants that property after a debtor defaults on a loan, they can just go take it, so long as that taking does breach the peace.  This phrase has been the subject of much debate.  However, this incredibly tragic story out of Chino Hills, CA shows how this type of repossession can go horribly wrong.

Banksy's art "stolen" from LA Wall

The infamous, incognito graffiti artist Banksy had a piece "stolen" from a wall in LA.   This begs the question of how a person can steal something that was never supposed to be where it was in the first place.

MERS bill possible forthcoming from Oregon Senate

The Willy Week reports this, today.  This is great law, which would clarify recording requirements for certain residential mortgages.  It is arguably redundant, as Judges are finding that Oregon laws prevent mortgages recorded in MERS's name to be foreclosed upon anyway.  However, the article suggests that efforts may be pre-emptive, as the mortgage industry will likely lobby for changes in Oregon law which allow MERS mortgages to be foreclosed upon.

Repeal of New 1099 Rules

Well, we will never get to experience the new 1099 rules passed as part of the Obama Health Care Legislation.  The House voted to repeal it today, and the Senate had already repealed it.  Obama doesn't like it anymore either, so it probably will go the way of the dodo before it ever comes into effect in 2012.

Basically, it would change the reporting requirements for a 1099 to reflect that businesses have to file 1099's not only for contractors whom they pay more than $600.00 per year, but also to anyone whom they pay over $600.00 per year to for goods.  The arguments against this law are mostly focused on the increased administrative burden of creating more 1099's.  Of course, no one seems to care that there is another solution to this problem, which is to make filing 1099's themselves simpler.

What gives me a chuckle about this law is that people are saying it will increase taxes by $25 Billion.  This is ridiculous.  1099's are informational returns which have no bearing whatsoever on the amount of tax people owe.  The only way filing a 1099 "increases" taxes is by making someone declare revenue which they are legally required to declare.  Apparently, remedial measures to stop people from cheating on their taxes are now "tax increases".

HAMP in Trouble

Republicans are gunning for HAMP this week.  It is not clear if this is motivated by cost cutting or a desire to implement a more effective program.  No one really knows what a more effective program would look like at this point.  It looks like the real solution may just be left up to individual states to enforce their own foreclosure laws, although the feds are considering penalizing banks for poor practices in this area.

Massachusetts foreclosures have dramatically dropped off due to systemic problems with banks not following that state's foreclosure laws.  HSBC has temporarily given up the ghost in Florida as well.  New York state is giving public defenders to people getting their homes foreclosed upon due to perceived state law violations.  And here in Oregon, the federal district court has braced itself for the coming torrent of foreclosure litigation by creating a foreclosure mediation panel.

San Jose MMJ Tax

The City of San Jose starts a 7% gross receipts tax on medical marijuana sales today.

I particularly like the disclaimer on the tax return:


"Payment of the tax in accordance with Municipal Code Chapter 4.66 does not authorize unlawful business."

In other words, we will take your money, but we do not believe what you are doing is actually legal.  Thanks, government.

Minecraft Creator - Piracy is Not Theft

The creator of the massively popular game Minecraft is a subscriber (pun intended) to the idea that software is a service, and if they service is provided well people will pay for it regardless of its availability for free unsanctioned channels.

McCormick and Schmick's plans huge investment in infrastructure

Portland based McCormick and Schmick's plans a large investment to modernize its restaurants in the face of two straight years of dismissal financial performance despite increases in revenue.

Online payday loan company fined

Oregon has stepped in and fined an on-line payday loan company for charging an incredible 842% interest rate on a loan.

$10K and an order to comply with the law seems like a slap on the wrist, but it is better than nothing.

New Copyright Settlement Scam

These guys are the newest, lowest budget, player in the copyright troll lawsuits.  They are shaking people down for $100.00 a pop.  This is basically just a phishing scheme for credit numbers, but because they have the veneer of defenders of innocent rich people's copyrights, no one is going to call them to the carpet as a bunch of scammers.

Mult. Co. wants some more money from the City

Thanks, Jack Bogdankski, for catching this one.  Multnomah County has changed the tax status of the Fairfield Hotel, aka The Fairfield on Stark, to non-exempt, meaning that the Portland Development Commission has to pay property tax on this housing.  The Tax Court shot the change down for 2009-10, but only because of defective notice by the County to the PDC.  Probably Mult. Co. will try this again, and the Tax Court will have to rule on the substantive issues soon.

Most people don't care too much about who foots the bill for the property tax on the Fairfield, although now hardly seems like the time when the PDC can afford to pay it.  But, some of the PDC's other projects, like the swanky but unprofitable hotel, The Nines, or the sweetheart deal to the Danish green energy firm Vestas for a new office in the Pearl, are a little more questionable.  Perhaps the county is signalling that they are no longer interested in subsidizing the city's public-private partnerships.

Michael Lewis sued for "The Big Short"

Michael Lewis has been sued by Wing Chau for his depiction of Chau in "The Big Short" as a buffoon who championed extremely risky investments in overrated bunches of subprime mortgages, and who was ultimately taken advantage of by savvier investors.  Of course, Michael Lewis's black and white world of evil ne'er do-wells aggressively marketing financial products filled with default-prone mortgages and white knights shorting those same products on behalf of the common man is pretty silly.

Everybody involved got rich from this scheme, both the winners and losers on Wall Street.  Everyone else, ie most people, got totally screwed.  However, Wing Chau is hardly a good guy.  But, he didn't act alone.  As Warren Buffett points out in the previously linked that entering into a transaction where one side is just really stupid doesn't make a fraud.  The real problem here is not any of the individuals who got filthy rich in these trades.

The problem is the total lack of government oversight, either before or after the fact.  After slapping a couple banks who were hiding extremely risky transactions on the wrist, the SEC still does not have the power to regulate the ratings agencies, who are ultimately responsible for letting the banks hid this risk.  So, the more things change, the more they stay the same, and we are only left to speculate what the next bubble will be.  Commercial Real Estate, anyone?  How about gold?  Maybe commodities in general.  Or social media  (liveblogging the next economic crises here, everybody).  The one thing we can be sure of is that guys like Wing Chau will get rich off of it, regardless of which side they bet on, and the SEC is going to be looking the other way when it happens.

Jury Trial Victory in a Securities Fraud Cases

An LA jury found that the CEO of homestore.com, Stuart Wolff was personally liable for damages to the California teacher's retirement fund, among others, for creating phantom profits for the company.  The total amount of damages is not yet determined, but will be awarded on a per share basis.